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[cols="^5%,^25%,^35%,^35%",options="header",frame=none, grid=none]
|===
|Version | Date | Q System Contract Registry | Preceding Constitution Hash
|1.2 | 14.05.2023 | `0xc3E589056Ece16BCB88c6f9318e9a7343b663522` | `25a0ad3b8de911b1745691b83875291c75f424487551ec83f7ef9ae8205ef059`
|===

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[.text-center]
== Q CONSTITUTION

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[.text-left]
=== PREAMBLE
[horizontal]
(A):: Q is an open-source system that is independent of any country, company
or organization.

(B):: Q has been developed and shall be further developed for the benefit of
humanity.

\(C):: We, the Q Token Holders, Validator Nodes, Validator Node Candidates,
Root Nodes, Q Nodes and Q ID Holders (together, the "*Q Stakeholders*")
who freely participate in, use, interact with or contribute to Q hereby
adopt the following constitution (this "*Q* *Constitution*").
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[.text-left]
=== Q CONSTITUTION
[.text-left]
=== Article 1.       SUPREMACY OF THE Q CONSTITUTION
[horizontal]
1.1:: This Q Constitution sets out the basic rules of Q, including the
rules for participating in, using, interacting with or contributing to
Q.
1.2:: This Q Constitution shall only be amended at the proposal of one or
more Q Token Holders if such proposal is put to a vote and accepted in
accordance with Appendix 5. Otherwise, any purported amendment to this
Q Constitution shall be null and void.
1.3:: By operating a full node that supports the Q peer-to-peer network,
each node on Q, including each Validator Node and each Root Node, (each node on Q, a "*Q Node*") agrees to
and accepts this Q Constitution, as amended from time to time in
accordance with the terms of this Q Constitution. By holding at least
one Q Token, each Q Token Holder agrees to and accepts this Q
Constitution, as amended from time to time in accordance with the terms
of this Q Constitution. By holding a Q Personal ID, each Q ID Holder
agrees to and accepts this Q Constitution, as amended from time to time
in accordance with the terms of this Q Constitution.
1.4:: Notwithstanding each Q Stakeholder's agreement to and acceptance of
this Q Constitution in accordance with Article 1.3, the Q Stakeholders
shall not at any time constitute, participate or act in a partnership
with one another under this Q Constitution.
1.5:: A Q Stakeholder shall only access Q and use the Q Blockchain using a
client software which offers a mechanism independent of the Q Blockchain
for collecting cryptographic proof of each removal of the Main Account or the Alias (as
applicable) of a Validator Node from the Validator Node List and each addition of the
Main Account of such Validator Node to the Validator Node Exclusion List
in accordance with Article 9.
1.6:: Capitalised terms used, but not otherwise defined in this Q
Constitution (including in the Preamble and Appendices to this Q
Constitution) shall have the meanings given in Appendix 1. Certain
technical parameters used in the definitions included in Appendix 1 are
specified in Part B of Appendix 6.
1.7:: The parameters in square brackets are included in this Q Constitution
for information purposes only and each of them reflects an aspect of the
current (March 2022) technical implementation of this Q Constitution.
Such parameters do not form part of this Q Constitution and amendments
to any such parameter do not constitute Fundamental Changes, Basic
Changes, Detailed Changes or Non-Constitutional Changes and,
accordingly, do not require the consent of any Q Stakeholder in
accordance with this Q Constitution at any time.
[.text-left]
=== Article 2.       THE Q BLOCKCHAIN AND TRANSACTIONS ON Q
[horizontal]
2.1:: Q shall operate on a public, distributed blockchain (the "*Q
Blockchain*").
2.2:: The Q Blockchain shall be maintained by a permissionless peer-to-peer
network of nodes.
2.3:: The state of Q at any time shall be validated on a delegated proof of
stake (DPoS) basis by the Validator Nodes.
2.4:: The Q Blockchain shall be the definitive record of the state of Q at
any time and of all transactions carried out on Q up to such time. The Q
Blockchain shall not be modified retrospectively. After a transaction
has been recorded on the Q Blockchain, it shall only be modified by way
of a subsequent transaction.
[.text-left]
=== Article 3.       Q TOKENS AND Q TOKEN HOLDERS
[horizontal]
3.1:: The native assets of Q shall be tokens in bearer form which are fully
fungible with each other (each, a "*Q Token*"). Each Q Token shall be
subdivided into and shall be freely transferable in fractions of
1/10^18^ or any integral multiple thereof. Unless the context requires
otherwise, all references to Q Tokens in this Q Constitution shall be
construed to include freely transferable fractions of Q Tokens.
3.2:: Initially, 1,000,000,000 Q Tokens shall be generated. Thereafter, a
number of additional Q Tokens equal to the Block Subsidy shall be
generated with every new block on the Q Blockchain and allocated between
the Q Stakeholders (other than the Q Nodes) in accordance with Part A of
Appendix 6.
3.3:: Each holder of a Q Token (the "*Q Token Holder*") may delegate some
or all of its rights (including, without limitation, voting rights) in
respect of any Q Token held by it to any other Q Token Holder.
3.4:: Each Q Token Holder may propose changes to and amendments of Q,
including, without limitation, this Q Constitution and vote on any such
proposal in accordance with Appendix 5.
[.text-left]
=== Article 4.       VALIDATOR NODES
[horizontal]
4.1:: The Operator of a node on Q may Self Stake to the main public key associated with
such node on Q (the "*Main Account*") some or all of the Q
Tokens owned by such Operator. Further, the Operator of a node on Q may designate by way of transaction on
the Q Blockchain another public key associated with such node on Q, different from
the Main Account, as an Alias of such Main Account. The Operator of a node on Q
may also remove by way of transaction on the Q Blockchain the public key previously
designated as the Alias of the Main Account of a node on Q.
4.2:: At any time, a number of nodes on Q (i)
up to the Maximum Number of Validator Nodes with the highest Total
Accountable Stake of Q Tokens at such time and (ii) whose Main Account or whose Alias is
included on the Validator Node List at such time shall act as
validator nodes (each such node, together with the Operator of such
node, a "*Validator Node*"). Each Validator Node expressly accepts this Q Constitution each time it co-signs
a block on the Q Blockchain which directly or indirectly embeds a hash
of this Q Constitution.
4.3:: At any time, a number of nodes on Q up to the Maximum Number of
Validator Node Candidates which are not Validator Nodes, but which have
the next highest Total Accountable Stake of Q Tokens at such time, and
whose Main Accounts are not included on the Validator Node Exclusion List,
shall be candidates to become Validator Nodes (each such node, together
with the Operator of such node, a "*Validator Node Candidate*").
4.4:: In addition to any Self Stake of Q Tokens to a node on Q by the
Operator of such node, any Q Token Holder may Delegate Stake some or all
of the Q Tokens owned by such Q Token Holder to the Main Account of a Q Node which is
already a Validator Node or a Validator Node Candidate.
4.5:: Each Validator Node shall be responsible for maintaining the state of
Q in compliance with this Q Constitution, with the care of a diligent
Validator Node and in good faith. In particular, but without limitation,
each Validator Node is obliged to:
+
[horizontal]
4.5.1::: operate a full node that supports the Q peer-to-peer network by
running a Q client software that reflects the rules of Q as laid down in
this Q Constitution;
4.5.2::: where applicable, verify each Voting Proposal in accordance with
Appendix 5 for technical correctness;
4.5.3::: as a strict obligation which the Q Token Holders consider essential
to enforce the rules of this Q Constitution and to protect the value of
the Q Blockchain, formulate block candidates which contain one or more
Valid Transactions on a first-come-first-served basis and sign those
block candidates or co-sign block candidates formulated by other
Validator Nodes which contain one or more Valid Transactions. Such Valid
Transactions shall include, without limitation:
+
[horizontal]
(a):::: any transaction technically required under Article 6, Article 7 or
Article 8;
(b):::: if an Enforceable Arbitral Award has been rendered, a corresponding
transaction recording the terms of such Enforceable Arbitral Award and,
if applicable, one or more further transactions implementing the terms
of such Enforceable Arbitral Award;
(c):::: if a Slashing Appeal is withdrawn or considered as withdrawn after
the expiry of the Slashing Appeal Verification Period, but before an
Enforceable Arbitral Award has been rendered, a corresponding
transaction recording the withdrawal of such Slashing Appeal;
(d):::: if any Voting Proposal is rejected in accordance with Paragraph (f)
of Appendix 5, a corresponding transaction recording the rejection of
such Voting Proposal; and
(e):::: if any Voting Proposal which is an Emergency Proposal and is
accepted in accordance with Paragraph (e)(ii) of Appendix 5, a
corresponding transaction recording the acceptance of such Voting
Proposal and, if applicable, one or more further transactions
implementing the terms of such Voting Proposal.
++ ++:::  For the avoidance of doubt, for the purposes of this Article 4.5.3, as long as a
Validator Node has a designated Alias, such Validator Node shall only be
entitled to act through its Alias and not through its Main Account.
4.6:: For all purposes under this Q Constitution including, without limitation, for the
purposes of Articles 4.8 and 4.9 and for the purposes of the Root Nodes' monitoring
obligations under Article 5.3, a Validator Node shall be fully responsible and liable at
all times for all actions taken through its Main Account and through its Alias,
including any failure by its Main Account or by its Alias to take a particular action.
4.7:: For validating transactions on Q and recording them on the Q
Blockchain on a first-come-first-served basis, the Validator Nodes shall
be entitled to receive certain fees in accordance with Appendix 3.
4.8:: Each Validator Node agrees and irrevocably accepts that, in case of a
breach of its obligations under this Q Constitution, it will be
sanctioned by the Slashing of Q Tokens Self Staked to it in accordance
with Article 6. The severity of the sanctions depends on the gravity of
the breach, as assessed by the Root Nodes on a case-by-case basis, where
applicable having regard for Appendix 8 and the maximum percentage of
Self Staked Q Tokens to be Slashed in the context of specific breaches.
Such sanctions are to be applied with rigour as a central means pursuant
to this Q Constitution to incentivize good conduct by Validator Nodes
generally, to compensate and incentivize those Q Token Holders who
exercise supervisory and policing functions, to compensate all Q Token
Holders for the general risk assumed and general losses incurred by
their entirety due to the conduct of non-compliant Validator Nodes, and
to limit the risk of future harm occurring.
4.9:: Further and in addition, each Validator Node agrees to and
irrevocably accepts that, if, at any time, it breaches any of its
obligations under Article 4.5.3, the Main Account or its Alias (as applicable) shall be removed from
the Validator Node List and the Main Account shall be included on the Validator Node
Exclusion List in accordance with Article 9. If the Main Account of a
Validator Node is included on the Validator Node Exclusion List at any
time, the relevant node shall immediately be removed from consensus and
cease being a Validator Node and, in particular, it shall not validate
any transactions on Q.

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[.text-left]
=== Article 5.       ROOT NODES
[horizontal]
5.1:: At any time, a number of nodes on Q up to the Maximum Number of Root
Nodes whose Main Account is included on the Root Node List shall act as root nodes (each such node,
together with the Operator of such node, a "*Root Node*").
5.2:: If a node on Q satisfies the requirements for inclusion on the
Root Node List as set out in Part A of Appendix 2, the Q Token Holder who is the Operator
of such node on Q may propose its appointment as a Root Node in accordance with Appendix
+5.+ If the relevant Voting Proposal is accepted, such node on Q shall become a Root Node and its Main Account shall be included on the Root Node List.
Further, each Q Token Holder may, at any time, propose the removal of
any one or more existing Root Nodes at such time and vote on any such
proposal in accordance with Appendix 5. If such Voting Proposal is
accepted, such Root Node shall cease being a Root Node and its Main Account shall be
removed from the Root Node List.
5.3:: Each Root Node shall be responsible for monitoring the functioning of
the Q Blockchain in line with this Q Constitution, with the care of a
diligent Root Node and in good faith. In particular, but without
limitation, each Root Node is obliged to:
+
[horizontal]
5.3.1::: provide such evidence as may reasonably be required by Q Token
Holders from time to time that such Root Node satisfies the requirements
for inclusion on the Root Node List as set out in Part A of Appendix 2
and publicly disclose and provide without undue delay evidence of any
changes to such information;
5.3.2::: operate a full node that supports the Q peer-to-peer network by
running a Q client software that reflects the rules of Q as laid down in
this Q Constitution;
5.3.3::: monitor whether Validator Nodes and Root Nodes act in compliance
with their obligations under this Q Constitution and identify any
relevant breaches;
5.3.4::: subject to Article 5.5, as a strict obligation which the Q Token
Holders consider essential to enforce the rules of this Q Constitution
and to protect the value of the Q Blockchain, if, at any time, a
Validator Node or a Root Node acts in breach of its obligations under
this Q Constitution, make a Slashing Proposal in respect of some or all
of the Q Tokens Self Staked to the relevant Validator Node or the
relevant Root Node;
5.3.5::: subject to Article 5.5, as a strict obligation which the Q Token
Holders consider essential to enforce the rules of this Q Constitution
and to protect the value of the Q Blockchain:
+
[horizontal]
(a):::: if a Slashing Proposal has been accepted in accordance with
Appendix 5, execute a corresponding Slashing Transaction;
(b):::: if an Enforceable Arbitral Award has been rendered, execute a
corresponding transaction recording the terms of such Enforceable
Arbitral Award and, if applicable, one or more further transactions
implementing the terms of such Enforceable Arbitral Award; and
(c):::: if a Slashing Appeal is withdrawn or considered as withdrawn after
the expiry of the Slashing Appeal Verification Period, but before an
Enforceable Arbitral Award has been rendered, execute a corresponding
transaction recording the withdrawal of such Slashing Appeal;
5.3.6::: subject to Article 5.5, as a strict obligation which the Q Token
Holders consider essential to enforce the rules of this Q Constitution
and to protect the value of the Q Blockchain, following the occurrence
of a Slashing Objection and the expiry of the related Slashing Appeal
Period, if such Root Node determines, in its reasonable view, that the
relevant Slashed Node has not commenced a Slashing Appeal in accordance
with Article 6.3.2 or the Slashing Node has commenced such Slashing
Appeal, but such Slashing Appeal has been withdrawn or is considered as
withdrawn prior to the expiry of such Slashing Appeal Period, propose a
Slashing Confirmation during the Slashing Appeal Verification Period;
5.3.7::: as a strict obligation which the Q Token Holders consider essential
to enforce the rules of this Q Constitution and to protect the value of
the Q Blockchain, if it is the respondent to any Slashing Appeal and if
a co-respondent Root Node is appointed in accordance with Article 6.8,
make an application that the co-respondent Root Node be joined as
co-respondent to the relevant proceedings in accordance with Article
6.9;
5.3.8::: vote on each Voting Proposal in respect of which it is an Eligible
Voter during the applicable Voting Period, unless such Voting Proposal
is accepted in accordance with Paragraph (e)(ii) of Appendix 5 prior to
the expiry of the applicable Voting Period;
5.3.9::: co-sign each block between Validation Cycles which includes the
Validator Node List for the next Validation Cycle, if:
+
[horizontal]
(a):::: the Validator Node List comprises the Validator Nodes with the
highest Total Accountable Stake of Q Tokens at such time; and
(b):::: such Validator Node List does not contain the Main Account
or the Alias of any Validator Node whose Main Account has been included on the Validator Node
Exclusion List in the circumstances described in Article 9.1.2;
5.3.10::: subject to Article 5.5, as a strict obligation which the Q Token
Holders consider essential to enforce the rules of this Q Constitution
and to protect the value of the Q Blockchain, each time a Validator Node
does not implement or otherwise give effect to:
+
[horizontal]
(a):::: any transaction technically required under Article 6, Article 7 or
Article 8;
(b):::: any transaction recording or implementing the terms of any
Enforceable Arbitral Award;
(c):::: any transaction recording any withdrawal of a Slashing Appeal after
the expiry of the relevant Slashing Appeal Verification Period;
(d):::: any transaction recording the rejection of a Voting Proposal in
accordance with Paragraph (f) of Appendix 5; or
(e):::: any transaction recording and implementing the terms of any Voting
Proposal which is an Emergency Proposal and which is accepted in
accordance with Paragraph (e)(ii) of Appendix 5,
++ ++::: determine whether, in its reasonable discretion, it should remove the
Main Account or the Alias (as applicable) of such Validator Node from the Validator Node List and add
the Main Account of such Validator Node to the Validator Node Exclusion
List in accordance with Article 9. Each Root Node shall be required to
do so in all circumstances where, in connection with the relevant breach
by such Validator Node, a Slashing Transaction is executed for 100% of
such Validator Node's Self Staked Q Tokens. In all other cases, each
Root Node shall be required to do so only if such Root Node determines
that removing the Main Account or the Alias (as
applicable) of such Validator Node from the Validator
Node List and adding the Main Account of such Validator Node to the
Validator Node Exclusion List is necessary or desirable to protect the
integrity of Q (including, without limitation, to prevent one or more
persons from circumventing or unduly delaying any Slashing in accordance
with this Q Constitution);
5.3.11::: following any changes to the composition of the panel of Root Nodes,
update the Root Node List, propagate such updated Root Node List via the
Q peer-to-peer network and maintain an offchain record of the then
current Root Node List;
5.3.12::: where applicable, review and verify a Voting Proposal which has been
accepted for compliance with this Q Constitution and if, in its
reasonable view, the Voting Proposal is not in compliance with this Q
Constitution, exercise its veto right in respect of such Voting Proposal
by making a declaration to that effect, in each case, in accordance with
Appendix 5; and
5.3.13::: in connection with any arbitration proceedings arising under or in
connection with this Q Constitution:
+
[horizontal]
(a):::: pay all fees it is required to pay in connection with such
arbitration proceedings in accordance with this Q Constitution, with the
rules applicable to such arbitration proceedings or following an award
given at such arbitration proceedings;
(b):::: conduct such arbitration proceedings properly and independently
and, in case of arbitration proceedings arising under or in connection
with a Slashing Appeal, act free of conflicting interests and have due
regard for the collective interests of the community of Q Stakeholders
in the outcome of such arbitration proceedings; and
(c):::: support to the fullest extent possible any Enforceable Arbitral
Award rendered in such arbitration proceedings.
++ ++::: For the avoidance of doubt, for the purposes of Articles 5.3.9 and 5.3.11, as long as a
Root Node has a designated Alias, such Root Node shall only be entitled to act
through its Alias and not through its Main Account.
5.4:: For all purposes under this Q Constitution including, without limitation, for the
purposes of Articles 5.6 and 5.7 and for the purposes of the Root Nodes' monitoring
obligations under Article 5.3, a Root Node shall be fully responsible and liable at all
times for all actions taken through its Main Account and through its Alias, including
any failure by its Main Account or by its Alias to take a particular action.
5.5:: In the circumstances described in Articles 5.3.4, 5.3.5, 5.3.6 and
5.3.10, if any Root Node makes the relevant Slashing Proposal, executes
a transaction, proposes a Slashing Confirmation or proposes the removal
of the Main Account or the Alias (as applicable) of a Validator Node from the Validator Node List and
the addition of the Main Account of such Validator Node to the Validator
Node Exclusion List, each other Root Node's obligation shall instead be
to vote on such Slashing Proposal, Slashing Confirmation or, as the case
may be such addition or removal of such public key in accordance with
Appendix 5 and to support such transaction.
5.6:: Each Root Node agrees and irrevocably accepts that, in case of a
breach of its obligations under this Q Constitution, it will be
sanctioned by the Slashing of Q Tokens Self Staked to it in accordance
with Article 6. In particular, in the event of such breach, any (other)
Root Node may make a Slashing Proposal in respect of some or all of the
Q Tokens Self Staked to the relevant Root Node which has breached its
obligations and each Eligible Voter may vote on such Slashing Proposal
in accordance with Appendix 5. The severity of the sanctions depends on
the gravity of the breach, as assessed by the Root Nodes. They are to be
applied with rigour as a central means pursuant to this Q Constitution
to incentivize good conduct by Root Nodes generally, to compensate and
incentivize those Q Token Holders who exercise supervisory and policing
functions, to compensate all Q Token Holders for the general risk
assumed and general losses incurred by their entirety due to the conduct
of non-compliant Root Nodes, and to limit the risk of future harm
occurring. Each Root Node shall assess the gravity of a breach on a
case-by-case basis, where applicable having regard for Appendix 8 and
the maximum percentage of Self Staked Q Tokens to be Slashed in the
context of specific breaches.
5.7:: Further and in addition, each Root Node agrees to and irrevocably
accepts that its Main Account shall be removed from the Root Node List in the
circumstances described in Article 9.2. If the Main Account of a Root Node is removed from
the Root Node List at any time, the relevant node shall immediately
cease being a Root Node and, in particular, shall no longer have any
voting rights in its capacity as Root Node.
[.text-left]
=== Article 6.       SLASHING
[horizontal]
6.1:: In case of a Slashing Proposal made by an Eligible Proposer, each
Eligible Voter in respect of such Slashing Proposal shall accept such
Slashing Proposal if it is of the view that the relevant Validator Node
or Root Node has acted in breach of its obligations under this Q
Constitution and the percentage of Q Tokens Self Staked to the relevant
node to be Slashed is proportionate to the severity of the breach,
having regard for the Slashing Considerations. For the avoidance of
doubt, only Q Tokens Self Staked to a relevant node (and not any
Delegated Stake) may be subject to a Slashing Proposal.
6.2:: In connection with each Slashing Proposal, each Validator Node shall
implement and otherwise give effect to a corresponding Slashing
Transaction in the circumstances described in Article 4.5.3.
6.3:: In respect of each Slashing Transaction, the affected Validator Node
or Root Node (the "*Slashed Node*") may:
+
[horizontal]
6.3.1::: notify the panel of Root Nodes during the Slashing Objection Period
that it intends to request a review of the Slashing (the giving of such
notice, a "*Slashing Objection*"); and
6.3.2::: only if a Slashing Objection occurs in accordance with Article
6.3.1, commence a review of the Slashing by way of arbitration in
accordance with Article 13 by submitting a request for arbitration and
paying the relevant filing fee to the Secretariat of the ICC
International Court of Arbitration, in each case, during the Slashing
Appeal Period (a review requested by a Validator Node, a "*VN Appeal*",
and a review requested by a Root Node, an "*RN Appeal*", and each VN
Appeal or RN Appeal, a "*Slashing Appeal*").
6.4:: A Slashing Appeal shall be the only recourse of the Slashed Node
against a Slashing and the Slashed Node shall not initiate other
proceedings against a Slashing.
6.5:: The respondent Root Node to each Slashing Appeal and, thus, a
substitute for the community of Q Stakeholders in the Slashing Appeal,
shall be the Eligible Proposer who made the relevant Slashing Proposal.
The Eligible Proposer shall be fully autonomous in handling the
proceedings and shall not be bound to follow any instructions by any
other Q Stakeholder.
6.6:: As soon as reasonably practicable after commencing a Slashing Appeal
during the Slashing Appeal Period, the Slashed Node shall notify the
panel of Root Nodes of the commencement of such Slashing Appeal and
shall provide them with reasonable evidence that the request for
arbitration has been received by the Secretariat of the ICC
International Court of Arbitration and that the Slashed Node has paid
the relevant filing fee. As soon as reasonably practicable after receipt
of the relevant request for arbitration from the Secretariat of the ICC
International Court of Arbitration, the (initial) respondent to the
relevant Slashing Appeal shall notify the panel of Root Nodes of such
receipt. If, at any time, a Slashing Appeal is withdrawn or considered
as withdrawn, as soon as reasonably practicable after such withdrawal or
deemed withdrawal, each of the Slashed Node and the each (co-)respondent
to the relevant Slashing Appeal shall notify the panel of Root Nodes of
such withdrawal or deemed withdrawal and shall provide them with
reasonable evidence thereof.
6.7:: In respect of each Slashing Objection which occurs, following the
expiry of each Slashing Appeal Period, during the Slashing Appeal
Verification Period, if any Root Node determines that, in its reasonable
view, the Slashed Node has not commenced a Slashing Appeal in accordance
with Article 6.3.2 or the Slashing Node has commenced such Slashing
Appeal, but such Slashing Appeal has been withdrawn or is considered as
withdrawn prior to the expiry of such Slashing Appeal Period, such Root
Node shall make a Voting Proposal during the Slashing Appeal
Verification Period that the Root Nodes declare that no Slashing Appeal
has been commenced and ongoing (such declaration, a "*Slashing
Confirmation*") and the other Root Nodes shall vote on such Voting
Proposal in accordance with Appendix 5. A Slashing Confirmation shall
occur if the relevant Voting Proposal is accepted.
6.8:: In respect of each Slashing Objection which occurs, if no Slashing
Confirmation occurs during the relevant Slashing Appeal Verification
Period and if, upon the expiry of the Slashing Appeal Period, the
percentage of Q Tokens Self Staked to the relevant node which are the
subject of the relevant Slashing Transaction is higher than the
Co-Respondent Threshold, then the panel of Root Nodes shall appoint a
co-respondent Root Node for the purposes of such Slashing Appeal. Any
Root Node shall be entitled to propose that it or another Root Node be
appointed as the co-respondent Root Node and such Root Node shall be so
appointed if such proposal is accepted in accordance with Appendix 5 by
no later than the end of the Co-Respondent Appointment Period. If, upon
the expiry of the Co-Respondent Appointment Period, no proposal is
accepted in accordance with the preceding sentence, the Root Node whose
time stamp is next in order on the Root Node List shall be automatically
appointed as the co-respondent Root Node (starting with the Root Node
with earliest time stamp on the Root Node List for the purposes of the
first Slashing Appeal to which this Article 6.8 applies, then following
the chronological order of the time stamps of the Root Nodes on the Root
Node List until the Root Node with latest time stamp on the then current
Root Node List is appointed and then (re-)starting with the Root Node
with earliest time stamp on the then current Root Node List).
6.9:: After a co-respondent Root Node is appointed in accordance with
Article 6.8, the (initial) respondent Root Node shall make an
application to the Arbitral Tribunal that the co-respondent Root Node be
joined as co-respondent to the proceedings and, to the extent necessary,
each of the relevant Slashed Node and the co-respondent Root Node shall
be deemed to support such application. The co-respondent Root Node to
each Slashing Appeal and, thus, also a substitute for the community of Q
Stakeholders in the Slashing Appeal, shall be fully autonomous in
handling the proceedings and shall not be bound to follow any
instructions by any other Q Stakeholder.
6.10:: In connection with each Slashing Transaction if (i) a Slashing
Objection occurs and (ii) a corresponding Slashing Confirmation does not
occur, neither the (initial) respondent Root Node, nor the co-respondent
Root Node shall make a settlement proposal which would become legally
binding upon acceptance, nor accept a legally binding settlement
proposal in respect of such Slashing Appeal unless the (initial)
respondent Root Node or, as the case may be, the co-respondent Root Node
has put such settlement proposal to a vote and such settlement proposal
has been accepted in accordance with Appendix 5.
6.11:: In connection with each Slashing Appeal:
+
[horizontal]
6.11.1::: in connection with any application by the parties that any
settlement reached between the parties be recorded in the form of an
award made by consent of the parties, the Arbitral Tribunal shall verify
whether the parties have complied with their obligations under Article
6.10 (and, if the Arbitral Tribunal is not satisfied that the parties
have complied with their obligations under Article 6.10, the Arbitral
Tribunal shall not record such settlement in the form of an award);
6.11.2::: the Arbitral Tribunal shall determine whether the appropriate
percentage of Q Tokens Self Staked to the relevant node should have been
equal to or lower than the actual percentage of Q Tokens subject of the
relevant Slashing Transaction (but may not determine that the
appropriate percentage of Q Tokens Self Staked to the relevant node to
be Slashed should have been higher than the actual percentage of Q
Tokens subject to the relevant Slashing Transaction);
6.11.3::: the Arbitral Tribunal shall not order the Slashed Node to make any
payment or delivery (including, without limitation, it shall not order
the payment of any compensation or damages) to any Q Token Holder
(including, without limitation, to the Eligible Proposer who initiated
the Slashing);
6.11.4::: the Arbitral Tribunal may order that the Slashed Node or the
(initial) respondent Root Node (but not the co-respondent Root Node)
compensate any costs incurred by any other party to the proceedings in
connection with the Slashing Appeal (including, without limitation, any
reasonable legal costs).
6.12:: Slashing (and, in the case of Validator Nodes only, removal of the
Main Account or the Alias (as applicable) of a relevant Validator Node from the Validator Node List and
addition of the Main Account of such Validator Node to the Validator Node
Exclusion List) shall be the primary remedy against a Validator Node or
a Rood Node which breaches its obligations under this Q Constitution,
but other remedies shall also be available. In particular, any Q
Stakeholder may request specific performance or cease and desist from
the Validator Node or the Root Node breaching its obligations under this
Q Constitution.

[.text-left]
=== Article 7.       WITHDRAWAL OF STAKE
[horizontal]
7.1:: If a Q Stakeholder (other than the Operator of a node on Q) has
requested the withdrawal of any Q Tokens which constitute Stake
Delegated to a node on Q, such Q Tokens shall be released upon the
expiry of a Q Token Time Lock Period following such request in all
circumstances.
7.2:: If the Operator of a node on Q has requested the withdrawal of any Q
Tokens Self Staked to such node, such Q Tokens shall be released upon
the expiry of a Q Token Time Lock Period following such request.
Notwithstanding the preceding sentence, if, during the Q Token Time Lock
Period, a Slashing Proposal is made in respect of some or all of the Q
Tokens Self Staked to such node, such Self Staked Q Tokens shall only be
released to the extent such Self Staked Q Tokens are not Slashed, as
described in Appendix 9.
[.text-left]
=== Article 8.        RIGHTS DURING AND FOLLOWING SLASHING
[horizontal]
8.1:: In connection with each Slashing Proposal:
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[horizontal]
8.1.1::: the Operator of the relevant node on Q shall retain all its rights
(other than withdrawal rights) arising out of or in connection with all
Self Staked Q Tokens until such time (if any) that a number of Self
Staked Q Tokens specified in the relevant Slashing Proposal (the result
rounded down to the nearest 1/10^18^ of a Q Token) are Slashed by way of
a corresponding Slashing Transaction; and
8.1.2::: the withdrawal rights arising out of or in connection with any Q
Tokens Staked to the relevant node on Q shall be determined in
accordance with Article 7.
8.2:: In connection with each Slashing Transaction, all Self Staked Q
Tokens which are Slashed pursuant to such Slashing Transaction shall be
held in escrow effected by way of smart contract during the Escrow
Period.
+
For these purposes, "*Escrow Period*" means the period commencing when a
Slashing Transaction is effected and:
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8.2.1::: if a Slashing Objection does not occur, the expiry of the Slashing
Objection Period; or
8.2.2::: if a Slashing Objection occurs, either:
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(a):::: the occurrence of a relevant Slashing Confirmation; or
(b):::: if a relevant Slashing Confirmation does not occur and:
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(i);; if the relevant Slashing Appeal is not withdrawn or considered as
withdrawn and an Enforceable Arbitral Award is rendered in respect of
such Slashing Appeal, the execution of a corresponding transaction
recording the terms of such Enforceable Arbitral Award; or
(ii);; if the relevant Slashing Appeal is withdrawn or considered as
withdrawn, the execution of a corresponding transaction recording the
terms of such withdrawal.
8.3:: All Q Tokens held in escrow in accordance with Article 8.2 shall be
disregarded for all purposes (including, without limitation, for the
purposes of determining the Total Accountable Stake of such node in
connection with any allocations and redistributions in accordance with
Part A of Appendix 6 and for the purposes of determining the number of
votes cast by any relevant Q Token Holder for the purposes of any vote
conducted in accordance with Appendix 5).
8.4:: Upon the expiry of the Escrow Period:
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8.4.1::: if either:
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(a):::: a Slashing Objection does not occur; or
(b):::: a Slashing Confirmation occurs; or
(c):::: a Slashing Confirmation does not occur, but the relevant Slashing
Appeal is withdrawn or considered as withdrawn,
++ ++::: the Q Tokens shall be released from escrow and shall be allocated and
redistributed in accordance with Part A of Appendix 6; or
8.4.2::: if a Slashing Objection occurs, a Slashing Confirmation does not
occur and the relevant Slashing Appeal is not withdrawn or considered as
withdrawn, the Q Tokens shall be released from escrow and each Validator
Node and each Root Node shall implement and otherwise give effect to any
Enforceable Arbitral Award rendered in respect of such Slashing Appeal
in accordance with Article 4.5.3 or Article 5.3.5.
[.text-left]
=== Article 9.        VALIDATOR NODE LIST, VALIDATOR NODE EXCLUSION LIST AND ROOT NODE LIST
[horizontal]
9.1:: As a strict obligation which the Q Token Holders consider essential
to enforce the rules of this Q Constitution and to protect the value of
the Q Blockchain, if, at any time, a Validator Node breaches any of its
obligations under Article 4.5.3, each Root Node shall determine whether,
in its reasonable discretion, it should remove such Validator Node from
consensus. Each Root Node shall make such determination in accordance
with Article 5.3.10. If a Root Node determines that such Validator Node
should be removed from consensus, such Root Node shall make a Voting
Proposal (or, if another Root Node has already made such Voting
Proposal, shall vote on such Voting Proposal):
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9.1.1::: to remove the Main Account or the Alias (as applicable) of such Validator Node from the Validator
Node List, thereby triggering a removal of such Validator Node from the
Validator Node List; and
9.1.2::: to add the Main Account of such Validator Node to the Validator Node
Exclusion List.
++ ++:: If such Voting Proposal is accepted by the Required Majority of votes
cast by Eligible Voters in accordance with Appendix 5, the Main Account or the Alias (as
applicable) of such Validator Node shall be removed from the Validator Node List and
the Main Account of such Validator Node shall be
added to the Validator Node Exclusion List and each Root Node shall
propagate via the Q peer-to-peer network an updated Validator Node List
setting out the updated membership of the panel of Validator Nodes and
an updated Validator Node Exclusion List.
9.2:: Each time the Operator of a Validator Node designates an Alias of the Main Account
of such Validator Node or removes an Alias of the Main Account of such Validator
Node, the Validator Node List shall be updated and each Root Node shall propagate
via the Q peer-to-peer network such updated Validator Node List setting out the
updated list of Main Accounts and/or Aliases of the panel of Validator Nodes.
9.3:: Each time a Q Token Holder makes a Voting Proposal to change the
membership of the panel of Root Nodes and such Voting Proposal is
accepted by the Required Majority of votes cast by Eligible Voters in
accordance with Appendix 5, the membership of the panel of Root Nodes
shall change accordingly and each Root Node shall propagate via the Q
peer-to-peer network an updated Root Node List setting out the updated
membership of the panel of Root Nodes. For the avoidance of doubt, each
Q Token Holder shall be entitled to propose a change to the membership
of the panel of Root Nodes in accordance with the preceding sentence at
any time in its sole and absolute discretion.
[.text-left]
=== Article 10.       EXPERT PANELS
[horizontal]
10.1:: Without prejudice to the Q Token Holders' rights under this Q
Constitution, the Q Token Holders hereby delegate their decision-making
rights with respect to certain technical and operational aspects of the
Q Blockchain to expert panels (the "*Expert Panels*").
10.2:: The current Expert Panels are set out in Appendix 7. Expert Panels
may be established or dissolved from time to time if a sufficient number
of Q Token Holders amend Appendix 7 accordingly. Any proposal for such
amendment shall constitute a proposal for amendment to the Appendices to
this Q Constitution and shall be decided by way of vote in accordance
with Appendix 5.
10.3:: The maximum number of members of each Expert Panel and its
decision-making powers are set out in Appendix 7. An Expert Panel shall
determine its own rules and procedures of working from time to time,
_provided that_ such rules and procedures are in compliance with this
Q Constitution. All members of an Expert Panel shall be Q Token Holders.
10.4:: Each Expert Panel shall make determinations and take decisions by way
of vote in accordance with Appendix 5.
10.5:: Each Q Token Holder may propose amendments to the membership of any
Expert Panel and vote on any such proposal in accordance with Appendix
5.
[.text-left]
=== Article 11.       Q ID
[horizontal]
11.1:: Q ID is an application on the Q Blockchain which legal or natural
persons can use to certify their identity.
11.2:: Following a successful verification of a person as a natural person,
such natural person shall be issued with a non-transferable natural
person flag on their Q ID certificate (such Q ID certificate with a
natural person flag, a "*Q Personal ID*"). At any point in time, the Q
Token Holders may amend this Article 11.2 such that, following such
amendment, 1 Q Token shall be generated upon the issuance of each Q
Personal ID.
11.3:: The holders of a Q Personal ID (each, a "*Q ID Holder*") shall have
certain veto rights in connection with any proposed changes to this Q
Constitution, the membership of the panel of Root Nodes or any Expert
Panel as set out in Appendix 5. However, the Q ID Holder's veto rights
shall initially be in abeyance and shall only become effective from such
point in time that a sufficient number of Q Token Holders (i) determine
that Q has become sufficiently decentralised to prevent an abuse of such
veto rights by the Q ID Holders and (ii) amend this Article 11.3
accordingly.
11.4:: Any proposal for amendment to Article 11.2 or Article 11.3 shall be
decided by way of vote in accordance with Appendix 5.
[.text-left]
=== Article 12.       INTEGRATED APPLICATIONS
[horizontal]
12.1:: Q Token Holders may designate any application which:
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[horizontal]
12.1.1::: is integrated on the Q Blockchain such that, (i) by participating in
decisions related to the governance and operation of Q in general, each
Q Token Holder directly or indirectly contributes to or impacts the
governance and operation of such application and, (ii) in exchange for
such participation, each Q Token Holder is entitled to receive a certain
number of Q Tokens in accordance with Part A of Appendix 6; and
12.1.2::: which operates as described in Appendix 4,
++ ++:: as an integrated application of Q (each, an "*Integrated Application*").
12.2:: Notwithstanding the above, there shall be no restrictions on who may
access Q and the applications which may be developed on the Q Blockchain
by any legal or natural person. In particular, the Q Blockchain shall
also support any applications which are not Integrated Applications.
[.text-left]
=== Article 13.       Applicable Law and Dispute Resolution
[horizontal]
13.1:: Unless the parties to such contracts expressly agree otherwise, all
contracts arising under and/or in connection with this Q Constitution
shall be governed by the UNIDROIT Principles of International Commercial
Contracts (2016).
13.2:: Each Q Stakeholder agrees to be bound by the Dispute Rules. By
acquiring and holding Q Tokens or a Q Personal ID, each Q Stakeholder
irrevocably agrees to be bound by the Dispute Rules Undertaking. If any
person does not accept the Dispute Rules or does not agree to be bound
by the Dispute Rules Undertaking, such person must not acquire or hold Q
Tokens or a Q Personal ID.
13.3:: If any Q Stakeholder breaches the Dispute Rules Undertaking, such Q
Stakeholder shall indemnify and hold harmless or compensate (at the
creditor's choice) each other Q Stakeholder against any financial
disadvantage suffered in connection with such breach and shall release
such other Q Stakeholder to the fullest extent possible from any
obligation arising under any judgment or ruling by a state court or an
arbitral tribunal if such judgment or ruling has been obtained in breach
of the Dispute Rules or the Dispute Rules Undertaking.
13.4:: All Q Stakeholders are bound by the following arbitration clause:
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[horizontal]
13.4.1::: All Q Stakeholders agree and irrevocably accept that all disputes
arising out of or in connection with this Q Constitution shall be
resolved by way of arbitration before an arbitration tribunal (the
"*Arbitral Tribunal*") under the Rules of Arbitration of the
International Chamber of Commerce (the "*ICC Rules*") and without
recourse to the ordinary courts of law. This arbitration agreement shall
include, without limitation:
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[horizontal]
(a):::: the holding of and transacting with Q Tokens or Q Personal IDs and
any corresponding records on the Q Blockchain;
(b):::: disputes about Slashing (in particular, each Slashing Appeal);
(c):::: each challenge by a Validator Node of the removal of the Main
Account or the Alias (as applicable) of such Validator
Node from the Validator Node List and the addition of such
Validator Node to the Validator Node Exclusion List in
accordance with Article 9 made by such Validator Node against the
relevant Eligible Proposer (as substitute for the community of Q
Stakeholders); and
(d):::: any Q Stakeholder's request for specific performance or cease and
desist from a Validator Node or from a Root Node which breaches its
obligations under this Q Constitution, including, without limitation,
its obligations with respect to any Slashing Transaction or any
Enforceable Arbitral Award.
13.4.2::: Pursuant to Article 30(2)(b) of the current ICC Rules (2021), the
Expedited Procedure Rules shall apply irrespective of the amount in
dispute.
13.4.3::: If the parties reach a settlement after the file has been
transmitted to the Arbitral Tribunal in accordance with the current ICC
Rules, the parties shall make a joint request to the Arbitral Tribunal
in accordance with Article 33 of the current ICC Rules that the
settlement be recorded in the form of an award made by consent of the
parties.
13.4.4::: In deviation from Articles 37(2), (3) and (4) of the current ICC
Rules (2021), any advances on costs in respect of a claim or a
counterclaim shall be payable in full by the party making such claim or
counterclaim.
13.4.5::: In accordance with Articles 38(4) and (5) of the current ICC Rules
(2021):
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[horizontal]
(a):::: the final award shall fix the costs of the arbitration and decide
which of the parties shall bear them or in what proportion they shall be
borne by the parties; and
(b):::: in making decisions as to costs, the Arbitral Tribunal may take
into account such circumstances as it considers relevant, including the
extent to which each party has conducted the arbitration in an
expeditious and cost-effective manner. For the avoidance of doubt, the
Arbitral Tribunal may give an award on the merits of the dispute in
favour of one of the parties and still decide that such party shall bear
some or all of the costs of the proceedings.
++ ++::: Further, in making decisions as to costs in the context of a Slashing
Appeal, the Arbitral Tribunal shall have regard for Article 6.11.4.
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13.4.6::: The seat of the arbitration shall be Zurich, Switzerland. The Arbitral
Tribunal may, after consulting with the parties, conduct hearings and
meetings at any location it considers appropriate, unless otherwise
agreed by the parties.
13.4.7::: Unless the Arbitral Tribunal determines otherwise, all filings may be
done electronically per e-mail and all hearings may be held virtually.
13.4.8::: The language of the arbitration shall be English.
13.4.9::: Swiss law shall apply to this arbitration clause.
13.4.10::: In its decision, the Arbitral Tribunal shall in particular:
+
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(a):::: make a ruling on its jurisdiction, if the latter is contested;
(b):::: enforce the rules for Slashing and decide on each Slashing Appeal,
having regard for the Slashing Considerations;
(c):::: in connection with each Slashing Appeal, rule on or otherwise make a
determination in respect of the matters set out in Article 6.11 (if
applicable); and
(d):::: in each Slashing Appeal in which the Slashed Node pleads that the
vote on the relevant Slashing Proposal or the outcome of such vote has
not been in compliance with the provisions in Appendix 5, give a
declaratory award which declares whether the vote is valid or not and
what the outcome of the vote is, in each case, in compliance with the
provisions in Appendix 5.
++ ++::: For the avoidance of doubt, if an Arbitral Tribunal renders an award
requiring a Root Node to make a payment or delivery, the relevant Root
Node can satisfy such award by, at its choice, either (1) delivering or
surrendering an appropriate number of Q Tokens or (2) paying the
monetary equivalent to the relevant number of Q Tokens, in each case, in
accordance with the terms of such award (including, in the case of limb
(2) above, as to the currency in which such monetary equivalent should
be paid and any applicable exchange rate).
13.4.11::: Arbitral awards issued pursuant to this Q Constitution may be enforced
in any court of competent jurisdiction.
13.4.12::: Notwithstanding Article 13.4.1, Q Stakeholders may:
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(a):::: apply to any competent judicial authority for interim or conservatory
measures; and
(b):::: commence court proceedings supporting arbitral proceedings or
relating to arbitral awards including, without limitation, setting
aside-, exequatur- or enforcement proceedings.
++ ++::: The application by a Q Stakeholder to a judicial authority for such
measures or the commencement by a Q Stakeholder of such court
proceedings shall not be deemed to be an infringement or a waiver of the
arbitration agreement and shall not affect the relevant powers reserved
to the Arbitral Tribunal.
13.5:: A link to a publicly available source where any Enforceable Arbitral
Award can be accessed shall be published on the Q Blockchain for the
purpose of improving the governance and legal certainty of Q for the
community of Q Stakeholders.

<<<

[.text-center]
=== APPENDIX 1
[.text-center]
=== DEFINITIONS
[.text-center]
=== PART A- FIRST-LEVEL DEFINITIONS
[horizontal.text-left]
(a):: "*Arbitral Tribunal*" has the meaning given in Article 13.4.1.
(b):: "*Alias*"  means, in respect of a node on Q, another public key associated with such
node on Q (i.e., other than the public key of the Main Account associated with such
node on Q), designated by the Operator of such node on Q by way of transaction on
the Q Blockchain. The Operator of a node on Q may remove an Alias at any time by
way of transaction on the Q Blockchain. Each Validator Node and each Root Node
may only have one Alias at any time, save that if a node on Q is both a Validator Node
and a Root Node at the same time, it may have one Alias in its capacity as Validator
Node and another Alias in its capacity as Root Node.
(c):: "*Basic Changes*" means any changes to Article 4 through to Article
13 of this Q Constitution, to any definitions contained in Part A of
Appendix 1 or to any technical parameters contained in Part B of
Appendix 6 to this Q Constitution, in each case, to the extent such
changes do not constitute Fundamental Changes.
(d):: "*Block Subsidy*" [_blockSubsidy_] means the number of Q Tokens
specified in Part B of Appendix 6.
(e):: "*CliqueEpochLength*" [_cliqueEpochLength_] means the number of
blocks specified in Part B of Appendix 6 which are produced within one
consensus cycle by the Validator Nodes participating in such consensus
cycle.
(f):: "*Co-Respondent Appointment Period*" means, in respect of each
Slashing Transaction, a period starting upon the expiry of the relevant
Slashing Appeal Verification Period and ending a number of hours
specified in Part B of Appendix 6 after the expiry of the relevant
Slashing Appeal Verification Period.
(g):: "*Co-Respondent Threshold*" means, in respect of each Slashing
Objection which occurs, if no Slashing Confirmation occurs during the
relevant Slashing Appeal Verification Period, the percentage of the
aggregate number of Q Tokens specified in Part B of Appendix 6 which are
Self Staked to such node on Q at such time determined as of the expiry
of the Slashing Appeal Period.
(h):: "*Delegated Stake*" means, in respect of a node on Q which is a
current Validator Node or a Validator Node Candidate, the number of Q
Tokens Staked to the Main Account of such node on Q in respect of which the relevant
transaction(s) effecting such Stake are not signed using the private key
corresponding to the Main Account of such node on Q. To "*Delegate Stake*"
shall be construed accordingly. For the avoidance of doubt, no Stake may
be Delegated to a node on Q other than a current Validator Node or a
Validator Node Candidate.
(i):: "*Detailed Changes*" means any changes to this Q Constitution other
than Fundamental Changes or Basic Changes.
(j):: "*Dispute Rules*" means the dispute resolution rules set out in this
Q Constitution and its Appendices from time to time.
(k):: "*Dispute Rules Undertaking*" means the unilateral commitment and
undertaking by each Q Token Holder (the "*consenting Q Token Holder*")
for the benefit of each other Q Token Holder to accept and observe the
Dispute Rules at all times and to ensure that the Dispute Rules are
binding on the consenting Q Token Holder at all times.
(l):: "*Enforceable Arbitral Award*" means any final arbitral award in
respect of which the statutory deadline for set aside proceedings has
lapsed or the competent state courts have rejected, wholly or in part,
with _res judicata effect_ an application for set aside.
(m):: "*Escrow Period*" has the meaning given in Article 8.2.
(n):: "*Expert Panel*" has the meaning given in Article 10.1.
(o):: "*Fundamental Changes*" means any changes to the fundamental
principles of Q set out in the Preamble to this Q Constitution or to
Article 1 through to Article 3 of this Q Constitution or to any related
definitions contained in Part A of Appendix 1 or to any technical
parameters contained in Part B of Appendix 6 to this Q Constitution
which are either used in or are otherwise necessary to construe the
Preamble or such Articles or any definitions or technical parameters
used in them.
(p):: "*Geographical Region*" means each of the following geographical
regions: (i) the USA; (ii) the rest of the Americas; (iii) Far East
(China, Japan, Korea); (iv) the rest of Asia; (v) Western Europe; (vi)
Eastern Europe; (vii) Middle East and Africa; and (viii) Australia and
Oceania.
(q):: "*ICC Rules*" has the meaning given in Article 13.4.1.
(r):: "*Industry Group*" means, at any time, each industry group
identified in Part C of Appendix 2 at such time.
(s):: "*Integrated Application*" has the meaning given in Article 12.1.
(t):: "*Main Account*" has the meaning given in Article 4.1.
(u):: "*Maximum Number of Experts*" [_maxNExperts_] means, at any time, in
respect of each Expert Panel, the number of experts for the relevant
Expert Panel specified in Part B of Appendix 6.
(v):: "*Maximum Number of Root Nodes*" [_maxNRootNodes_] means, at any
time, the number of nodes on Q specified in Part B of Appendix 6.
(w):: "*Maximum* *Number of Validator Node Candidates*"
[_maxNStandbyValidators_] means, at any time: (i) if, at such time, the
number of nodes on Q acting as Validator Nodes are fewer than the
Maximum Number of Validator Nodes, nil (0); and (ii) if, at such time,
the number of nodes on Q acting as Validator Nodes is equal to the
Maximum Number of Validator Nodes, the lower of the number of nodes on Q
specified for such purposes in Part B of Appendix 6 and the number of
nodes on Q which are not Validator Nodes, but which have the next
highest Total Accountable Stake of Q Tokens at such time and whose
public keys are not included on the Validator Node Exclusion List.
(x):: "*Maximum Number of Validator Nodes*" [_maxNValidators_] means, at
any time, the number of nodes on Q specified in Part B of Appendix 6.
(y):: "*Non-Constitutional Changes*" means any changes to Q which do not
amount to Fundamental Changes, Basic Changes or Detailed Changes.
(z):: "*Operator*" of a node on Q means the legal or natural person who
owns the private key associated with the main public key of such node.
(aa):: "*Proposing Root Node*" means, in respect of a Slashing Proposal in
respect of any Slashing of Q Tokens which have been Self Staked to a
Validator Node or to a Root Node, the Root Node which makes such
Slashing Proposal.
(bb):: "*Q* *Constitution*" has the meaning given in Preamble (C).
(cc):: "*Q ID Holder*" has the meaning given in Article 11.3.
(dd):: "*Q Node*" has the meaning given in Article 1.3.
(ee):: "*Q Personal ID*" has the meaning given in Article 11.2.
(ff):: "*Q* *Stakeholder*" has the meaning given in Preamble (C).
(gg):: "*Q Token*" has the meaning given in Article 3.1.
(hh):: "*Q Token Holder*" has the meaning given in Article 3.3.
(ii):: "*Q Token Time Lock Period*" means, in connection with a request by
any party for the release of Q Tokens owned and Staked by such party
from the relevant Stake, the period of time specified in Part B of
Appendix 6 after such request is made.
(jj):: "*RN Appeal*" has the meaning given in Article 6.3.2.
(kk):: "*Root Node*" has the meaning given in Article 5.1.
(ll):: "*Root Node Candidate*" means, at any time, each Q Node which
wishes to become a Root Node at such time.
(mm):: "*Root Node List*" means the list of Main Accounts of the current panel of Root Nodes which
satisfy the requirements for inclusion on the Root Node List as set out
in Part A of Appendix 2 and whose appointment has been approved by the
Required Majority of votes cast by Eligible Voters in accordance with
Appendix 5.
(nn):: "*Self Stake*" means, in respect of a node on Q, the number of Q
Tokens Staked to the Main Account of such node on Q by the Operator of such node on Q, in
respect of which the relevant transaction(s) effecting such Stake are
signed using the private key corresponding to the Main Account of such
node on Q. To "*Self Stake*" shall be construed accordingly.
(oo):: To "*Slash*" any Q Tokens and a "*Slashing*" of any Q Tokens which
have been Self Staked to a Validator Node or a Root Node means the
confiscation and redistribution of such Self Staked Q Tokens in
accordance with this Q Constitution after such Validator Node or such
Root Node has acted in breach of its obligations under this Q
Constitution.
(pp):: "*Slashed Node*" has the meaning given in Article 6.3.
(qq):: "*Slashing Appeal*" has the meaning given in Article 6.3.2.
(rr):: "*Slashing Appeal Period*" means, in respect of each Slashing
Transaction, a period starting upon the occurrence of a Slashing
Objection during the Slashing Objection Period and ending a number of
hours specified in Part B of Appendix 6 after the occurrence of such
Slashing Objection.
(ss):: "*Slashing Appeal Verification Period*" means, in respect of each
Slashing Transaction, a period starting upon the expiry of the relevant
Slashing Appeal Period and ending a number of hours specified in Part B
of Appendix 6 after the expiry of the relevant Slashing Appeal Period.
(tt):: "*Slashing Confirmation*" has the meaning given in Article 6.7.
(uu):: "*Slashing Considerations*" means, in connection with any Slashing
Proposal, each of:
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(i)::: whether the relevant Validator Node or Root Node whose Self Staked
Q Tokens are the subject of such Slashing Proposal has acted in breach
of its obligations this Q Constitution;
(ii)::: the adequate percentage of Self Staked Q Tokens to be Slashed in
connection with the relevant breach;
(iii)::: in considering the adequate percentage of Self Staked Q Tokens (if
any) to be Slashed:
+
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(A):::: whether the relevant breach happened with intent, negligence, or
accidentally;
(B):::: whether the relevant breach was isolated or repeated;
\(C):::: whether the relevant breach caused economic harm to some or all of
the Q Stakeholders, considering also the materiality of such harm;
(D):::: if applicable, the severity of the breach having regard for
Appendix 8 and the maximum percentage of Self Staked Q Tokens to be
Slashed in the context of specific breaches; and
(E):::: whether a similar or analogous fact patterns has been considered
and whether any applicable guidance has been given in connection with
any previous Slashing Transactions or awards of Arbitral Tribunals
constituted in accordance with this Q Constitution (to the extent known
or otherwise available).
(vv):: "*Slashing Objection*" has the meaning given in Article 6.3.1.
(ww):: "*Slashing Objection Period*" means, in respect of each Slashing
Transaction, a period starting upon the relevant Slashing Transaction
being published on the Q Blockchain and ending a number of hours
specified in Part B of Appendix 6 after the relevant Slashing
Transaction being published on the Q Blockchain or, if a Slashing
Objection occurs before such period has expired, ending upon the
occurrence of such Slashing Objection.
(xx):: "*Slashing Proposal*" means, in respect of any Slashing of Q Tokens
which have been Self Staked to a Validator Node or a Root Node, the
proposal by an Eligible Proposer that such Slashing is effected,
including the percentage of Self Staked Q Tokens to be Slashed, which
shall also specify the main public key of the Eligible Proposer and any other
information necessary to establish the full name and address of the
Eligible Proposer which can be used by the relevant Validator Node or,
as the case may be, Root Node for the purposes of identifying the
Eligible Proposer in connection with any arbitration proceedings.
(yy):: "*Slashing Reward Share*" means, in connection with the Slashing of
any Q Tokens which have been Self Staked to a Validator Node or to a
Root Node, the lower of (1) the percentage of the Self Staked Q Tokens
specified for such purposes in Part B of Appendix 6 which are Slashed
pursuant to the relevant Slashing Transaction and (2) the percentage of
the Q Tokens specified for such purposes in Part B of Appendix 6 which
are Staked to the relevant Proposing Root Node at the time the relevant
Slashing Proposal is made.
(zz):: "*Slashing Transaction*" means, in respect of each Slashing Proposal
which is accepted by the Required Majority of votes cast by Eligible
Voters in accordance with Appendix 5, a corresponding transaction on the
Q Blockchain, pursuant to which the percentage of Q Tokens Self Staked
to the relevant node specified in such Slashing Proposal, rounded down
to the nearest 1/10^18^ of a Q Token, are confiscated from the relevant
Slashed Node and placed in escrow effected by way of smart contract, to
be released from escrow and allocated and redistributed in accordance
with Article 8.4 upon the expiry of the relevant Escrow Period.
(aaa):: To "*Stake*" or to "*Stake to a node on Q*" any Q Tokens and a
"*Stake*" of any Q Tokens by a Q Token Holder means the delivery of such
Q Tokens to a smart contract linked to the Main Account of a particular
node on Q for the purposes of securing the Q Blockchain by means of a
proof of stake consensus and, as a result, the immobilization of such Q
Tokens on the Q Blockchain. Each Stake shall be effected by way of
either Self Stake or Delegated Stake. If a Q Token Holder has Staked to
a node on Q any Q Tokens, such Q Tokens shall remain Staked to such node
on Q until such time that (1) the Q Token Holder withdraws such Q Tokens
from such Stake or (2) such Q Tokens are Slashed.
(bbb):: "*Total Accountable Stake*" means, in respect of any node on Q, the
lower of (i) the aggregate number of Q Tokens Staked to the Main Account of such node
(taking into account both any Self Stake and any Stake Delegated to such
node) and (ii) the number of Q Tokens Self Staked to the Main Account of such node
multiplied by the Stake Delegation Factor specified for such purposes in
Part B of Appendix 6. As long as any relevant Q Tokens are held in
escrow in accordance with Article 8.2, for the purposes of this
definition, such Q Tokens shall be deemed not to be Self Staked to such
node and number of Q Tokens determined in accordance with the preceding
sentence shall be reduced accordingly.
(ccc):: "*Valid Transaction*" means any transaction on the Q Blockchain
which has been validly signed with the private key of the legal or
natural person initiating such transaction, which does not constitute
double spending, which is not inconsistent or otherwise constitutes a
breach of this Q Constitution in any other way and in respect of which
any applicable transaction fees have been fully paid.
(ddd):: "*Validation Cycle*" means the initiation, co-signing and
publication on the Q Blockchain of all blocks with Valid Transactions
within a CliqueEpochLength.
(eee):: "*Validator Node*" has the meaning given in Article 4.1.
(fff):: "*Validator Node Candidate*" has the meaning given in Article 4.3.
(ggg):: "*Validator Node Exclusion List*" means, at any time, the most
recent time-stamped list of the Main Accounts of all (former) Validator
Nodes whose Main Accounts or Aliases (as applicable) have been removed from the Validator Node List in the
circumstances described in Article 9.1 and which has been
cryptographically signed by at least 75% of the panel of Root Nodes at
the relevant time.
(hhh):: "*Validator Node List*" means the list of the (current) panel of
Validator Nodes whose Main Accounts have the highest Total Accountable Stake of Q Tokens at
such time and whose Main Accounts are not included on the Validator Node
Exclusion List. In respect of each Validator Node on the (current) panel of
Validator Nodes, if such Validator Node has designated an Alias which has not been
removed, the Validator Node List shall include the Alias and not the Main Account of
such Validator Node. Otherwise, the Validator Node List shall include the Main
Account of such Validator Node.
(iii):: "*VN Appeal*" has the meaning given in Article 6.3.2.

[.text-center]
=== PART B- SECOND-LEVEL DEFINITIONS
[horizontal.text-left]
(a):: "*Borrowing Fee*" has the meaning given in Paragraph 1(a)(iii) of
Appendix 4.
(b):: "*Collateralization Ratio*" has the meaning given in Paragraph
1(a)(i) of Appendix 4.
(c):: "*Eligible Collateral*" has the meaning given in Paragraph 1(a)(i)
of Appendix 4.
(d):: "*Eligible Proposer*" means, in respect of a Voting Proposal, any
person specified in respect of the relevant type of Voting Proposal in
the column "Eligible Proposer" in the table set out in Paragraph 3 of
Appendix 5.
(e):: "*Eligible Q Stakeholder*" means a Q Stakeholder other than a Q
Node.
(f):: "*Eligible Voter*" means, in respect of a Voting Proposal, any
person specified in respect of the relevant type of Voting Proposal in
the column "Eligible Voter" in the table set out in Paragraph 3 of
Appendix 5.
(g):: "*Emergency Proposal*" means any determination by one or more Root
Nodes that Q needs to be upgraded without delay and that a failure to do
so carries a high likelihood of causing material damage to the interests
of the Q Stakeholders (including, without limitation, to remedy any
critical security vulnerabilities and remove any exploit opportunities)
and associated proposal by one or more Root Nodes of an appropriate
upgrade, as determined by such Root Node(s) acting reasonably.
(h):: "*Liquidation Fee*" has the meaning given in Paragraph 1(a)(vii) of
Appendix 4.
(i):: "*Liquidation Ratio*" has the meaning given in Paragraph 1(a)(vii)
of Appendix 4.
(j):: "*Oracle*" means, in respect of any level, value or other
information, the external price source used for the purposes of
obtaining such level, value or other information.
(k):: "*Q DeFi*" has the meaning given in Paragraph 1 of Appendix 4.
(l):: "*Q ID Veto Quorum*" means in respect of a Voting Proposal which is
subject to approval by the Q ID Holders, the quorum of Q ID Holders
specified in respect of the approval of the relevant type of Voting
Proposal in the column "Q ID Veto Quorum" in the table set out in
Paragraph 3 of Appendix 5.
(m):: "*Q Lending & Borrowing Platform*" has the meaning given in
Paragraph 1 of Appendix 4.
(n):: "*Q L&B Immobilized Amount*" has the meaning given in Paragraph 1(b)
of Appendix 4.
(o):: "*Q L&B Loan*" has the meaning given in Paragraph 1(a)(i) of
Appendix 4.
(p):: "*Q L&B User*" has the meaning given in Paragraph 1(a) of Appendix
4.
(q):: "*Q Reserve Share*" means, in connection with any Q Tokens to be
allocated or redistributed to the Q Token Holders in accordance with
Paragraphs 2, 3 or 4 of Part A of Appendix 6, a proportion of such Q
Tokens as determined by the Q Fees & Incentives Expert Panel from time
to time which shall not be allocated or redistributed, but which shall
be retained within Q as reserve and used for technical and/or
operational purposes to ensure the overall system stability of Q.
(r):: "*Quorum*" means, in respect of a Voting Proposal, the quorum of
Eligible Voters specified in respect of the relevant type of Voting
Proposal in the column "Quorum" in the table set out in Paragraph 3 of
Appendix 5. If the Eligible Voters are Q Token Holders, the Quorum shall
be determined as a percentage of the aggregate number of votes
associated with all Q Tokens in existence at the time of the relevant
Voting Proposal.
(s):: "*Quorum Required for Supermajority*" means, in respect of a Voting
Proposal, the quorum of Eligible Voters specified in respect of the
relevant type of Voting Proposal in the column "Quorum Required for
Supermajority" in the table set out in Paragraph 3 of Appendix 5. If the
Eligible Voters are Q Token Holders, the Quorum Required for
Supermajority shall be determined as a percentage of the aggregate
number of votes associated with all Q Tokens in existence at the time of
the relevant Voting Proposal.
(t):: "*QUSD*" has the meaning given in Paragraph 1 of Appendix 4.
(u):: "*QUSD Surplus Threshold*" has the meaning given in Paragraph 2 of
Appendix 4.
(v):: "*Required Majority*" means, in respect of a Voting Proposal, the
number of votes cast by Eligible Voters in favour of such Voting
Proposal, expressed as a percentage of the overall number of votes cast
by Eligible Voters in connection with such Voting Proposal, necessary
for the relevant type of Voting Proposal to be accepted as specified in
the column "Required Majority" in the table set out in Paragraph 3 of
Appendix 5. If the Eligible Voters are Q Token Holders, the Required
Majority shall be determined as a percentage of the aggregate number of
votes associated with the Q Tokens held by the Q Token Holders who cast
their votes, where each Q Token Holder shall have one (1) vote in
respect of each 1/10^18^ of a Q Token held by it. If the Eligible Voters
are Root Nodes or members of an Expert Panel, the Required Majority
shall be determined as a percentage of the aggregate number of votes
which can be cast by the panel of Root Nodes or the relevant Expert
Panel, where each Root Node or member of the relevant Expert Panel shall
have one (1) vote.
(w):: "*Required Supermajority*" means, in respect of a Voting Proposal,
the number of votes cast by Eligible Voters in favour of such Voting
Proposal, expressed as a percentage of the overall number of votes cast
by Eligible Voters in connection with such Voting Proposal, necessary
for the relevant type of Voting Proposal to be accepted as specified in
the column "Required Supermajority" in the table set out in Paragraph 3
of Appendix 5. If the Eligible Voters are Q Token Holders, the Required
Supermajority shall be determined as a percentage of the aggregate
number of votes associated with the Q Tokens held by the Q Token Holders
who cast their votes, where each Q Token Holder shall have one (1) vote
in respect of each 1/10^18^ of a Q Token held by it. If the Eligible
Voters are Root Nodes or members of an Expert Panel, the Required
Supermajority shall be determined as a percentage of the aggregate
number of votes which can be cast by the panel of Root Nodes or the
relevant Expert Panel, where each Root Node or member of the relevant
Expert Panel shall have one (1) vote.
(x):: "*Stabilization Reward*" has the meaning given in Paragraph 1(b) of
Appendix 4.
(y):: "*Undercollateralized Q L&B User*" has the meaning given in
Paragraph 1(a)(vii) of Appendix 4.
(z):: "*Voting Period*" means, in respect of a Voting Proposal, the period
during which Eligible Voters are entitled to vote in respect of the
relevant type of Voting Proposal as specified in the column "Voting
Period" in the table set out in Paragraph 3 of Appendix 5. For the
avoidance of doubt, where the Eligible Voters are Root Nodes, a Voting
Proposal may be accepted in accordance with Paragraph (e)(ii) of
Appendix 5 prior to the expiry of the applicable Voting Period.
(aa):: "*Voting Proposal*" means any proposal affecting Q made by a Q
Stakeholder in accordance with this Q Constitution which is put to a
vote by some or all Q Stakeholders in accordance with Appendix 5.

<<<

[.text-center]
=== APPENDIX 2
[.text-center]
=== ROOT NODE SELECTION
[.text-center]
=== PART A- MANDATORY REQUIREMENTS
[horizontal.text-left]
1.:: Each Root Node shall:
+
[horizontal.text-left]
(i)::: confirm its identity, ownership and control structure;
(ii)::: confirm its residence or, in the case of legal persons, address of
incorporation and, if different, address at which it may be served in
connection with any arbitration proceedings;
(iii)::: provide an overview of its motivation for becoming and acting as a
Root Node;
(iv)::: expressly accept, sign and make available for inspection by any Q
Stakeholder a signed copy of this Q Constitution. For the purposes of
this sub-paragraph (iv), a Root Node may sign this Q Constitution by
signing electronically a hash of this Q Constitution;
(v)::: be resident or, in the case of legal persons, incorporated in one
or more jurisdictions, in each of which foreign arbitral awards are
regularly enforced without undue delay in accordance with the terms of
the Convention on the Recognition and Enforcement of Foreign Arbitral
Awards of 1958 (the so-called New York Convention). In case the Root
Node is a branch of a legal person, this requirement shall also apply to
such legal person. In case the Root Node is a subsidiary of another
legal person, this requirement shall also apply to each natural and
legal person who directly or indirectly holds more than 25% of the
equity of such Root Node or who is able to exercise more than 25% of the
decision-making powers of such Rood Node (including because it is able
to appoint more than 25% of such Root Node's board of directors or
managers).

[.text-center]
=== PART B- ELIGIBILITY CRITERIA
[horizontal.text-left]
1.:: Each Root Node Candidate shall contact the Root Node Selection
Expert Panel and provide such information as may be requested by any
member of the Root Node Selection Expert Panel to assess whether and to
what extent such Root Node Candidate satisfies the criteria set out in
Part A and Part B of this Appendix 2.
2.:: The Root Node Selection Expert Panel shall make an assessment in
connection with each such application and shall promptly issue a
statement of the outcome of such assessment. Each assessment statement
shall be made available to each Q Token Holder upon request. In
particular, the Root Node Selection Expert Panel shall assess (i)
whether the Root Node satisfies each requirement set out in Part A of
this Appendix 2, (ii) the number of Q Tokens which are Self Staked to
such Root Node Candidate in accordance with Paragraph 4, (iii) the
industry classification of such Root Node Candidate in accordance with
Paragraph 5, (iv) the geographical classification of such Root Node
Candidate in accordance with Paragraph 6 and (v) such Root Node
Candidate's reputation score in accordance with Paragraph 7.
3.:: Following such assessment, the Root Node Selection Expert Panel
shall assign to each Root Node Candidate and to each member of the then
current panel of Root Nodes a score as described in each of those
Paragraphs. For the purposes of assigning a score to a Root Node
Candidate or any member of the then current panel of Root Nodes, the
Root Node Selection Expert Panel shall not take into account the impact
to such score or any other Root Node Candidate(s) at the same time.
4.:: _Number of Q Tokens Staked._ The Root Node Selection Expert Panel
shall rank the Root Node Candidate and the members of the then current
panel of Root Nodes in terms of the number of Q Tokens which are Self
Staked to such Root Node Candidate. The node with most Self Staked Q
Tokens shall be assigned a score of 100 and the remaining nodes shall be
assigned scores corresponding to their rank in decreasing integrals of
one (1), floored at zero (0). If two or more nodes have the same number
of Self Staked Q Tokens, they shall be assigned equal score. The score
assigned to the node with the next lower number of Self Staked Q Tokens
shall not be the next lower integral number, but shall take into account
the number of immediately preceding two or more nodes assigned equal
score.
5.:: _Industry Classification._ The Root Node Selection Expert Panel
shall assign the Root Node Candidate and each member of the then current
panel of Root Nodes to an Industry Group. The Root Node Selection Expert
Panel shall then assign a score to each node, equal to 50 _divided by_
the number of nodes who are assigned to the same Industry Group.
6.:: _Geographical Classification._ The Root Node Selection Expert Panel
shall assign the Root Node Candidate and each member of the then current
panel of Root Nodes to a Geographical Region. The Root Node Selection
Expert Panel shall then assign a score to each node, equal to 50
_divided by_ the number of nodes who are assigned to the same
Geographical Region.
7.:: _Reputation Score._ The Root Node Selection Expert Panel shall
assign a reputation score to each of the Root Node Candidate and each
member of the then current panel of Root Nodes. Each node shall be
assigned a reputation score of 10 for every consecutive 182 days and 12
hours it has spent as a member of the panel of Root Nodes (whether or
not such node is a member of the panel of Root Nodes at the time of such
assessment). The reputation score of each node shall be reduced by five
(5) for every 5% of Self Staked Q Tokens which have been Slashed during
any period of consecutive 182 days and 12 hours, determined as a
percentage of the Q Tokens which are Self Staked to such node at the
beginning of the relevant period and without double-counting any Slashed
Q Tokens.

<<<

[.text-center]
=== PART C- INDUSTRY GROUPS
[horizontal.text-left]
1.:: The Root Node Selection Expert Panel shall assign each Root Node and
each Root Node Candidate to one of the following industry groups:
+
[horizontal.text-left]
(i)::: corporates;
(ii)::: financial institutions;
(iii)::: funds/investors;
(iv)::: blockchain infrastructure operators;
(v)::: not-for-profit organizations;
(vi)::: academic institutions;
(vii)::: governments, governmental agencies or regulatory bodies;
(viii)::: law firms or other legal personnel;
(ix)::: consulting or professional services;
(x)::: decentralized protocols and DAOs; and
(xi)::: other.

<<<

[.text-center]
=== APPENDIX 3
[.text-center]
=== TRANSACTION FEES
[horizontal.text-left]
1.:: Transaction fees shall be calculated and charged in Q Tokens.
2.:: Transaction fees charged by Validator Nodes shall be allocated
between the Q Stakeholders (other than the Q Nodes) in accordance with
Part A of Appendix 6.
3.:: The transaction fees charged by the Validator Nodes in respect of
each transaction on the Q Blockchain shall take into account the
computational, storage and other costs incurred by the Validator Nodes
in validating the state of the Q Blockchain and recording the relevant
transaction on the Q Blockchain.
4.:: The fees which the Validator Nodes shall charge per transaction shall
be determined by the Q Fees & Incentives Expert Panel from time to time
and shall be such that, after the applicable transaction fees incurred
in connection with a transaction on the Q Blockchain are allocated
between the groups of existing Q Stakeholders (other than the Q Nodes)
in accordance with Part A of Appendix 6, the amount so allocated to the
Validator Nodes is at least equal to the relevant computational, storage
and other costs incurred by the Validator Nodes in validating the state
of the Q Blockchain and recording the relevant transaction on the Q
Blockchain.

<<<

[.text-center]
=== APPENDIX 4
[.text-center]
=== INTEGRATED APPLICATIONS
[horizontal.text-left]
1.:: The Q Decentralized Finance System ("*Q DeFi*") is an Integrated
Application on the Q Blockchain, comprising a lending and borrowing
platform ("*Q Lending & Borrowing Platform*") and a Q stablecoin
("*QUSD*").
+
[horizontal]
(a)::: The Q Lending & Borrowing Platform allows users (each, a "*Q L&B
User*") to draw loans in QUSD against delivery of collateral. The key
features of the Q Lending & Borrowing Platform with respect to loans in
QUSD shall be as follows:
+
[horizontal]
(i):::: Each Q L&B User may deliver tokenized assets as determined by the Q
DeFi Expert Panel from time to time ("*Eligible Collateral*") as
collateral to the Q Lending & Borrowing Platform by way of smart
contract. Following delivery of such Eligible Collateral, the relevant Q
L&B User may draw one or more loans (each, a "*Q L&B Loan*") in QUSD in
an amount up to the quotient of the value of the Eligible Collateral
delivered divided by the relevant collateralization ratio in respect of
such type of Eligible Collateral as determined by the Q DeFi Expert
Panel from time to time (the "*Collateralization Ratio*").
(ii):::: The relevant Q L&B User may (but shall not be required to) deliver
further Eligible Collateral from time to time.
(iii):::: The relevant Q L&B User shall be entitled to the return of any
Eligible Collateral previously delivered in an amount equal to the
excess between (I) the aggregate of the then current value of each type
of Eligible Collateral previously delivered and (II) the aggregate
principal amount of all Q L&B Loans they have drawn and which are
outstanding multiplied with the relevant Collateralization Ratio plus
the aggregate of all accrued borrowing fees as determined by the Q DeFi
Expert Panel from time to time (each, a "*Borrowing Fee*") multiplied by
the relevant Collateralization Ratio.
(iv):::: Each Q L&B Loan shall not have a fixed maturity date, but shall be
repayable at the option of the relevant Q L&B User.
(v):::: Each Q L&B User shall pay a Borrowing Fee in QUSD determined by
reference to the principal amount of each Q L&B Loan they have drawn and
which is outstanding. The Borrowing Fee shall be due upon repayment of
the relevant Q L&B Loan.
(vi):::: No payments or deliveries shall be due from a Q L&B User in respect
of any Q L&B Loan other than (I) the initial delivery of Eligible
Collateral, (II) the payment of a Borrowing Fee in respect of such Q L&B
Loan and (III) the repayment of such Q L&B Loan.
(vii):::: Should the aggregate value of all Eligible Collateral delivered by
a Q L&B User (the "*Undercollateralized* *Q L&B User*") fall below a
pre-defined threshold as determined by the Q DeFi Expert Panel from time
to time (the "*Liquidation Ratio*"), the Q Lending & Borrowing Platform
shall auction such Eligible Collateral. Such auction of collateral shall
be open to all Q Token Holders and all bids shall be denominated in
QUSD. Upon the conclusion of the auction, (I) the relevant Eligible
Collateral shall be transferred to the highest bidder, (II) any excess
of the amount paid by the highest bidder over the sum of (x) the
aggregate principal amount outstanding of the Q L&B Loans drawn by the
Undercollateralized Q L&B User, (y) the aggregate of all accrued
Borrowing Fees in respect of such Q L&B Loans and (z) a fee covering the
cost of auctioning or selling the relevant Eligible Collateral as
determined by the Q DeFi Expert Panel from time to time (the
"*Liquidation Fee*") shall be transferred to the Undercollateralized Q
L&B User and (III) the Undercollateralized Q L&B User shall not be
required to repay the outstanding Q L&B Loans or to pay the accrued
Borrowing Fees and shall no longer be entitled to the return of the
Eligible Collateral originally delivered.
(viii):::: The value of any Eligible Collateral delivered shall be determined
from time to time by Oracles in respect of the relevant type of
collateral as determined by the Q DeFi Expert Panel from time to time.
(b)::: The Q Lending & Borrowing Platform also allows Q L&B Users to
immobilize a number of QUSD (the "*Q L&B Immobilized Amount*") in the Q
Lending & Borrowing Platform by way of smart contract against receipt of
a stabilization reward (the "*Stabilization Reward*") in QUSD determined
by reference to the number of QUSD comprising the Q L&B Immobilized
Amount. Any Q L&B Immobilized Amount shall be immediately released from
the relevant smart contract upon request by the relevant Q L&B User. The
accrued Stabilization Reward in respect of any Q L&B Immobilized Amount
shall be paid to the relevant Q L&B User upon release of such Q L&B
Immobilized Amount.
(c)::: QUSD is the first stablecoin to be issued on Q DeFi. The key
features of QUSD shall be as follows:
+
[horizontal]
(i):::: QUSD shall be issued when Q L&B Users draw Q L&B Loans. QUSD shall
be burned when Q L&B Users repay Q L&B Loans or when the Eligible
Collateral in respect of Q L&B Loans has been auctioned.
(ii):::: The value of QUSD shall be pegged against the value of the
US-Dollar.
2.:: All Borrowing Fees paid by Q L&B Users (including an amount
corresponding to any Borrowing Fees economically retained within the Q
Lending & Borrowing Platform as part of the auction or sale of Eligible
Collateral in accordance with Paragraph 1(a)(vii) above) shall be paid
in QUSD and shall be used to build up a reserve on the Q Lending &
Borrowing Platform. The amount of QUSD standing to the credit of such
reserve shall be used to pay any relevant Stabilization Rewards which
have accrued and are due in accordance with Paragraph 1(b) above. If, at
any time, the amount of QUSD standing to the credit of such reserve
exceeds the surplus threshold determined by the Q DeFi Expert Panel and
applicable at such time (the "*QUSD Surplus Threshold*"), the Q Lending
& Borrowing Platform shall auction an amount of QUSD equal to such
excess. Such auction of collateral shall be open to all Q Token Holders
and all bids shall be denominated in Q Tokens. Upon the conclusion of
the auction, (I) the relevant amount of QUSD shall be transferred to the
highest bidder in exchange for the relevant number of Q Tokens which
have been bid and (II) such Q Tokens shall be redistributed between the
groups of existing Q Stakeholders in accordance with Part A of Appendix
6.

<<<

[.text-center]
=== APPENDIX 5
[.text-center]
=== VOTING
[horizontal.text-left]
1.:: In connection with each Voting Proposal, if the Eligible Voters are:
+
[horizontal]
(a)::: Q Token Holders, each Q Token Holder shall have one (1) vote in
respect of each 1/10^18^ of a Q Token held by the Q Token Holder;
(b)::: Root Nodes, each Root Node shall have one (1) vote; and
(c)::: the members of an Expert Panel, each member of such Expert Panel
shall have one (1) vote.
2.:: Subject to Paragraph 3, in connection with each Voting Proposal:
+
[horizontal]
(a)::: such Voting Proposal shall be made by an Eligible Proposer and
propagated on the Q peer-to-peer network;
(b)::: each Validator Node shall validate or shall procure that an Alias of such Validator Node validates a corresponding transaction
recording the terms of the Voting Proposal on the Q Blockchain without
undue delay;
(c)::: all Eligible Voters may (and, in case of Root Nodes, shall) vote on
the Voting Proposal within the Voting Period. In respect of each Voting
Proposal, the Eligible Voters may either accept or reject such Voting
Proposal;
(d)::: if there is no Quorum of Eligible Voters voting in respect of a
Voting Proposal within the Voting Period, the Voting Proposal shall be
rejected;
(e)::: if there is Quorum of Eligible Voters voting in respect of a Voting
Proposal within the Voting Period:
+
[horizontal]
(i):::: if there is not a Required Majority of votes cast by Eligible
Voters, the Voting Proposal shall be rejected. For all purposes under
this Q Constitution, a Voting Proposal shall be rejected in accordance
with this Paragraph (e)(i): (i) in case the Eligible Voters are Root
Nodes, at the point in time when sufficiently many Root Nodes have voted
against the Voting Proposal that it is no longer mathematically possible
that the Required Majority of Eligible Voters comprising the Quorum can
cast their vote in favour of such Voting Proposal, regardless of whether
the applicable Voting Period has expired; and (ii) in all other cases,
upon the expiry of the applicable Voting Period;
(ii):::: if there is a Required Majority of votes cast by Eligible Voters,
the Voting Proposal shall be accepted, subject to Paragraphs (f) and
(g). For all purposes under this Q Constitution, a Voting Proposal shall
be accepted in accordance with this Paragraph (e)(ii): (i) in case the
Eligible Voters are Root Nodes, at the point in time when the Required
Majority of Eligible Voters comprising the Quorum have cast their vote
in favour of such Voting Proposal, regardless of whether the applicable
Voting Period has expired; and (ii) in all other cases, upon the expiry
of the applicable Voting Period; and
(iii):::: if there is a Quorum Required for Supermajority and if there is a
Required Supermajority of votes cast by Eligible Voters, the Voting
Proposal shall be accepted. For all purposes under this Q Constitution,
a Voting Proposal shall be accepted in accordance with this Paragraph
(iii) upon the expiry of the applicable Voting Period;
(f)::: if the Voting Proposal is accepted in accordance with Paragraph
(e)(ii) and is subject to approval by each Root Node as indicated in the
column "Root Node Validation Period" in the table set out in Paragraph
3, each Root Node shall verify whether, in its reasonable discretion,
such Voting Proposal is in compliance with this Q Constitution. In such
circumstances, such Voting Proposal shall nonetheless be rejected if,
within the Root Node Validation Period indicated in the column "Root
Node Validation Period" in the table set out in Paragraph 3, more than
50% of the Root Nodes exercise their veto right in respect of such
Voting Proposal by declaring that, in their reasonable view, such Voting
Proposal is not in compliance with this Q Constitution. For the
avoidance of doubt, if the Voting Proposal is accepted in accordance
with Paragraph (e)(iii), this Paragraph (f) shall not apply;
(g)::: if the Voting Proposal is accepted in accordance with Paragraph
(e)(ii) and, if applicable, is not rejected in accordance with Paragraph
(f) and, further, is subject to approval by the Q ID Holders as
indicated in the column "Q ID Veto Period" in the table set out in
Paragraph 3 and if the veto rights of Q ID Holders have become effective
in accordance with Article 11.3 (_Q ID_), each Q ID Holder may exercise
its veto right. In such circumstances, such Voting Proposal shall
nonetheless be rejected if, within the relevant period indicated in the
column "Q ID Veto Period" in the table set out in Paragraph 3, more than
50% of the Q ID Veto Quorum of Q ID Holders exercise their veto right in
respect of such Voting Proposal. For the avoidance of doubt, if the
Voting Proposal is accepted in accordance with Paragraph (e)(iii), this
Paragraph (g) shall not apply;
(h)::: if the Voting Proposal is accepted in accordance with Paragraphs
(e)(ii) or (e)(iii) and, if applicable, is not rejected in accordance
with either Paragraph (f) or Paragraph (g) above, each Validator Node
shall validate a transaction on the Q Blockchain recording such Voting
Proposal and such Voting Proposal shall be implemented without undue
delay.

<<<

[horizontal.text-left]
3.:: For the purposes of Paragraph 2 above:

[width="99%",cols="24%,8%,6%,5%,6%,7%,9%,9%,10%,7%,9%",options="header",]
|===
|Subject of Voting Proposal: a|
Eligible Proposer:

{empty}[EP]

a|
Eligible Voters:

{empty}[EV]

a|
Voting Period:

{empty}[VP]

a|
Quorum:

{empty}[QRM]

a|
Required Majority:

{empty}[RMAJ]

a|
Quorum Required for Supermajority:

{empty}[SQRM]

a|
Required Supermajority:

{empty}[SMAJ]

a|
Root Node Validation Period:

{empty}[RNVALP]

a|
Q ID Veto Period

{empty}[QIDVTP]

a|
Q ID Veto Quorum:

{empty}[QIDVTQRM]

a|
Fundamental Changes

{empty}[fundQSection]

|Any Q Token Holder |Q Token Holders |672 hours |50% |More than 75% of
the votes cast |N/A |N/A |336 hours |168 hours |10%

a|
Basic Changes

{empty}[basicQSection]

|Any Q Token Holder |Q Token Holders |672 hours |25% |More than 50% of
the votes cast |N/A |N/A |336 hours |168 hours |10%

a|
Detailed Changes

{empty}[detailedQSection]

|Any Q Token Holder |Q Token Holders |672 hours |5% |More than 50% of
the votes cast |N/A |N/A |336 hours |168 hours |10%

a|
Non-Constitutional Changes

{empty}[changeQnotConst]

|Any Q Token Holder |Q Token Holders |672 hours |1% |More than 50% of
the votes cast |N/A |N/A |336 hours |168 hours |10%

a|
Emergency Proposal

{empty}[emgQUpdate]

|Any Root Node |Root Nodes |24 hours |50% |More than 50% of the Eligible
Voters (regardless of how many Eligible Voters cast their vote) |N/A
|N/A |N/A |N/A |N/A

a|
Any appointment of a Root Node Candidate to the panel of Root Nodes or
any removal of a Root Node from the panel of Root Nodes

{empty}[addOrRemRoot]

|Any Q Token Holder who satisfies the requirements for inclusion on the
Root Node List as set out in Part A of Appendix 2 |Q Token Holders |336
hours |5% |More than 50% of the votes cast |25% |75% |168 hours |168
hours |10%

|Any removal of the Main Account or the
Alias of a Validator Node from the Validator
Node List and any corresponding addition of the Main
Account of a Validator Node on the Validator Node Exclusion List |Any Root Node |Root
Nodes |336 hours |75% |Equal to or more than 75% of the Eligible Voters (regardless
of how many Eligible Voters cast their vote) |N/A |N/A |N/A |N/A |N/A

|Any removal of the Main Account of a (former) Validator Node from the
Validator Node Exclusion List |Any Root Node |Root Nodes |336 hours |75%
|Equal to or more than 75% of the Eligible Voters (regardless of how many Eligible
Voters cast their vote) |N/A |N/A |N/A |N/A |N/A

a|
Slashing Proposal in respect of Q Tokens which are Self Staked to a
Validator Node

{empty}[valSlashing]

|Any Root Node |Root Nodes |336 hours |50% |More than 50% of the
Eligible Voters (regardless of how many Eligible Voters cast their vote)
|N/A |N/A |N/A |N/A |N/A

a|
Slashing Proposal in respect of Q Tokens which are Self Staked to a Root
Node

{empty}[rootSlashing]

|Any Root Node |Q Token Holders |336 hours |1% |More than 50% of the
votes cast (regardless of how many Eligible Voters cast their vote) |25%
|75% |168 hours |N/A |N/A

|Slashing Confirmation |Any Root Node |Root Nodes |336 hours |0% |More
than 50% of the Eligible Voters (regardless of how many Eligible Voters
cast their vote) |N/A |N/A |N/A |N/A |N/A

|Settlement proposal received or to be made by respondent Root Node or
co-respondent Root Node in a Slashing Appeal |Any respondent Root Node
or co-respondent Root Node in such Slashing Appeal |Root Nodes |336
hours |0% |More than 50% of the Eligible Voters (regardless of how many
Eligible Voters cast their vote) |N/A |N/A |N/A |N/A |N/A

|Proposal that a Root Node be appointed as the co-respondent Root Node
in a Slashing Appeal |Any Root Node |Root Nodes |336 hours |0% |More
than 50% of the Eligible Voters (regardless of how many Eligible Voters
cast their vote) |N/A |N/A |N/A |N/A |N/A

a|
Any amendment to membership of the Fees & Incentives Expert Panel

{empty}[EPQFI.addOrRemExpert]

|Any Q Token Holder |Q Token Holders |336 hours |0% |More than 50% of
the votes cast |N/A |N/A |336 hours |168 hours |10%

a|
Any amendment to membership of the DeFi Expert Panel

{empty}[EPDR.addOrRemExpert]

|Any Q Token Holder |Q Token Holders |336 hours |0% |More than 50% of
the votes cast |N/A |N/A |336 hours |168 hours |10%

a|
Any amendment to membership of the Root Node Selection Expert Panel

{empty}[EPRS.addOrRemExpert]

|Any Q Token Holder |Q Token Holders |336 hours |0% |More than 50% of
the votes cast |N/A |N/A |336 hours |168 hours |10%

a|
Any decision by the Fees & Incentives Expert Panel

{empty}[EPQFI.changeParam]

|Any member of such Expert Panel |Members of relevant Expert Panel |168
hours |0% |More than 50% of the votes cast |N/A |N/A |336 hours |N/A
|N/A

a|
Any decision by the DeFi Expert Panel

{empty}[EPDR.changeParam]

|Any member of such Expert Panel |Members of relevant Expert Panel |168
hours |0% |More than 50% of the votes cast |N/A |N/A |336 hours |N/A
|N/A

a|
Any decision by the Root Node Selection Expert Panel

{empty}[EPRS.changeParam]

|Any member of such Expert Panel |Members of relevant Expert Panel |168
hours |0% |More than 50% of the votes cast |N/A |N/A |336 hours |N/A
|N/A
|===

<<<

[.text-center]
=== APPENDIX 6
[.text-center]
=== CONSTITUTIONAL PARAMETERS
[.text-center]
=== PART A- ALLOCATION OF Q TOKENS
[horizontal.text-left]
1.:: Each time additional Q Tokens are generated by way of inflation
subsidy in accordance with Article 3.2, such Q Tokens shall be allocated
between the groups of existing Q Stakeholders (other than Q Nodes) as
follows:
+
[width="100%",cols="50%,50%",options="header",]
|===
|Q Stakeholders: |Target percentage of Q Tokens allocated to such Q
Stakeholders:
a|
Q Token Holders

{empty}[rewardShareQTokenHolders]

|40%

a|
Q ID Holders

{empty}[rewardShareQIDHolders]

|N/A until veto rights of Q ID Holders become effective following an
amendment to Article 11.3 are activated.

a|
Validator Nodes and Validator Node Candidates

{empty}[rewardShareValidatorNodes]

|40%

a|
Root Nodes

{empty}[rewardShareRootNodes]

|20%
|===

++ ++:: _provided that_ the actual percentage in respect of each allocation may
be higher or lower than the target percentage and shall be as determined
by the Q Fees & Incentives Expert Panel from time to time, having regard
for the integrity, efficiency and robustness of Q overall.

2.:: In connection with any Q Tokens charged by Validator Nodes by way of
transaction fees in accordance with Appendix 3, such Q Tokens shall be
allocated between the groups of existing Q Stakeholders (other than Q
Nodes) as follows:
+
[width="100%",cols="50%,50%",options="header",]
|===
|Q Stakeholders: |Target percentage of Q Tokens allocated to such Q
Stakeholders:
|Q Token Holders |40% _less_ the applicable Q Reserve Share of such Q
Tokens

|Q ID Holders |N/A until veto rights of Q ID Holders become effective
following an amendment to Article 11.3 are activated.

|Validator Nodes and Validator Node Candidates |40%

|Root Nodes |20%
|===
++ ++:: _provided that_ the actual percentage in respect of each allocation may
be higher or lower than the target percentage and shall be as determined
by the Q Fees & Incentives Expert Panel from time to time, having regard
for the overall system stability of Q.

3.:: In connection with each Slashing Transaction which takes place in
accordance with Article 6, (i) a number of Slashed Q Tokens equal to the
relevant Slashing Reward Share shall be allocated to the relevant
Proposing Root Node and (ii) the remaining Slashed Q Tokens shall be
redistributed between the groups of existing Q Stakeholders (other than
Q Nodes) as follows:
+
[width="100%",cols="50%,50%",options="header",]
|===
|Q Stakeholders: |Target percentage of Q Tokens redistributed to such Q
Stakeholders:
|Q Token Holders |40% _less_ the applicable Q Reserve Share of such Q
Tokens

|Q ID Holders |N/A until veto rights of Q ID Holders become effective
following an amendment to Article 11.3 are activated.

|Validator Nodes and Validator Node Candidates |40%

|Root Nodes |20%
|===
++ ++:: _provided that_ the actual percentage in respect of each redistribution
may be higher or lower than the target percentage and shall be as
determined by the Q Fees & Incentives Expert Panel from time to time,
having regard for the overall system stability of Q.

4.:: In connection with any Borrowing Fees converted into Q Tokens in
accordance with Appendix 4, a relevant number of Q Tokens shall be used
to pay any relevant Stabilization Rewards (if applicable) and the
remainder shall be allocated between the groups of existing Q
Stakeholders (other than Q Nodes) as follows:
+
[width="100%",cols="50%,50%",options="header",]
|===
|Q Stakeholders: |Target percentage of Q Tokens allocated to such Q
Stakeholders:
|Q Token Holders |40% _less_ the applicable Q Reserve Share of such Q
Tokens

|Q ID Holders |N/A until veto rights of Q ID Holders become effective
following an amendment to Article 11.3 are activated.

|Validator Nodes and Validator Node Candidates |40%

|Root Nodes |20%
|===
++ ++:: _provided that_ the actual percentage in respect of each allocation may
be higher or lower than the target percentage and shall be as determined
by the Q Fees & Incentives Expert Panel from time to time, having regard
for the integrity, efficiency and robustness of Q overall.

5.:: Within each relevant group of Q Stakeholders (other than Q Nodes), any
Q Tokens allocated or redistributed to such group of Q Stakeholders
shall be allocated to the members of such group as follows:
+
[horizontal]
(a)::: to the Q Token Holders, _pro rata_ to the number of Q Tokens held by
each Q Token Holder;
(b)::: to the Q ID Holders, _equally_ to each Q ID Holder;
(c)::: to the Validator Nodes _pro rata_ to the Total Accountable Stake of
each Validator Node;
(d)::: to the Validator Node Candidates, _equally_ to each Validator Node
Candidate; and
(e)::: to the Root Nodes, _equally_ to each Root Node,
++ ++:: or, if such _pro rata_ or equal allocation or redistribution is not
practicably possible, such other allocation or redistribution as shall
be determined by the Q Fees & Incentives Expert Panel from time to time,
having regard for the target allocation or redistribution set out above
and for the integrity, efficiency and robustness of Q overall.

6.:: Any Q Tokens to be allocated or redistributed to the groups of
existing Q Stakeholders (other than Q Nodes) shall be held in escrow
effected by way of smart contract.
7.:: Each Eligible Q Stakeholder may claim the Q Tokens allocated or
redistributed to such Q Stakeholder from time to time in accordance with
this Appendix 6 by claiming such Q Tokens from such smart contract.

[.text-center]
=== PART B- TECHNICAL PARAMETERS
[horizontal.text-left]
The following are certain technical parameters used in the definitions
included in Appendix 1.

[width="100%",cols="51%,49%",options="header",]
|===
|Variable: |Value:
a|
Block Subsidy

{empty}[blockSubsidy]

|1.5 Q Tokens
a|
CliqueEpocheLength

{empty}[cliqueEpochLength]

|101
|Co-Respondent Appointment Period |30 days
|Co-Respondent Threshold |10%
a|
Maximum Number of Experts: +
Q DeFi Expert Panel

{empty}[EPDR.maxNExperts]

|15
a|
Maximum Number of Experts: +
Q Fees & Incentives Expert Panel

{empty}[EPQFI.maxNExperts]

|15
a|
Maximum Number of Experts: +
Root Node Selection Expert Panel

{empty}[EPRS.maxNExperts]

|15
a|
Maximum Number of Root Nodes

{empty}[maxNRootNodes]

|27
a|
Maximum Number of Validator Node Candidates

{empty}[maxNStandbyValidators]

|32
a|
Maximum Number of Validator Nodes

{empty}[maxNValidators]

|27
a|
Q Token Time Lock Period

{empty}[rootWithdrawP], [valWithdrawP]

|21 days
a|
Slashing Appeal Period

{empty}[rootSlashingAppealP], [valSlashingAppealP]

|60 days
|Slashing Appeal Verification Period |7 days
a|
Slashing Objection Period

{empty}[rootSlashingOBJP], [valSlashingOBJP]

|30 days
a|
Slashing Reward Share

{empty}[rootSlashingReward], [valSlashingReward]

a|
{empty}(1) 10%

{empty}(2) 10%

a|
Stake Delegation Factor

{empty}[stakeDelegationFactor]

|10
|===

<<<

[.text-center]
=== APPENDIX 7
[.text-center]
=== EXPERT PANELS
[horizontal.text-left]
1.:: The Q DeFi Expert Panel shall be responsible for taking decisions on
certain technical and operational aspects of Q DeFi (as described in
Appendix 4). In particular:
+
[horizontal]
(a)::: The Q DeFi Expert Panel shall consist of up to the Maximum Number of
Experts specified for the Q DeFi Expert Panel in Part B of Appendix 6.
(b)::: The competence of the Q DeFi Expert Panel shall be as follows:
+
[horizontal]
(i):::: The Q DeFi Expert Panel shall determine what currencies and assets
constitute Eligible Collateral for the purposes of the Q Lending &
Borrowing Platform from time to time.
(ii):::: The Q DeFi Expert Panel shall determine the Oracles to be used for
the purposes of determining the value of each type of Eligible
Collateral from time to time.
(iii):::: The Q DeFi Expert Panel shall determine the Collateralization Ratio
and the Liquidation Ratio for each type of Eligible Collateral from time
to time.
(iv):::: The Q DeFi Expert Panel shall determine the collateral ceiling (if
any) in respect of each type of Eligible Collateral from time to time.
(v):::: The Q DeFi Expert Panel shall set the Liquidation Fees applicable
to auctions of Eligible Collateral from time to time.
(vi):::: The Q DeFi Expert Panel shall set the Borrowing Fees applicable to
Q L&B Loans and the Stabilization Rewards applicable to Q L&B
Immobilized Amounts from time to time.
(vii):::: The Q DeFi Expert Panel shall determine the technical and
operational parameters in connection with each type of Eligible
Collateral necessary to ensure consistency between the use of such
Eligible Collateral on the Q Blockchain (including, without limitation,
within Q DeFi) and on the original blockchain on which such type of
Eligible Collateral is tokenized from time to time.
(viii):::: The Q DeFi Expert Panel shall determine the QUSD Surplus Threshold
applicable from time to time.
2.:: The Q Fees & Incentives Expert Panel shall be responsible for taking
certain decisions regarding fees and incentives within Q. In particular:
+
[horizontal]
(a)::: The Q Fees & Incentives Expert Panel shall consist of up to the
Maximum Number of Experts specified for the Q Fees & Incentives Expert
Panel in Part B of Appendix 6.
(b)::: The competence of the Q Fees & Incentives Expert Panel shall be as
follows:
+
[horizontal]
(i):::: The Q Fees & Incentives Expert Panel shall determine the rate(s) at
which Validator Nodes may charge transaction fees in accordance with
Appendix 3.
(ii):::: The Q Fees & Incentives Expert Panel shall determine the System
Reserve Share in connection with any Q Tokens to be allocated or
redistributed to the groups of existing Q Stakeholders (other than Q
Nodes) in accordance with Part A of Appendix 6 and the circumstances in
which the corresponding reserve of Q Tokens within the Q Blockchain may
be used for technical and/or operational purposes within the Q
Blockchain.
(iii):::: In circumstances where it is not reasonably practicable that Q
Tokens be allocated or redistributed to Q Stakeholders (other than Q
Nodes) in accordance with any ratio specified in Part A of Appendix 6,
the Q Fees & Incentives Panel shall determine an alternative basis for
such allocation or redistribution, having regard for such ratio.
(iv):::: The Q Fees & Incentives Expert Panels shall set the process in
accordance with which Q Stakeholder (other than Q Nodes) shall claim the
Q Tokens allocated or redistributed to them from time to time in
accordance with this Appendix 6, including all technical parameters.
(v):::: The Q Fees & Incentives Panels shall determine from time to time
the price source to be used for the purposes of determining the rate at
which QUSD shall be converted into Q Tokens.
3.:: The Root Node Selection Expert Panel shall be responsible for
determining whether and to what extent any Root Node Candidate satisfies
the eligibility criteria set out in Part B of Appendix 2. The Root Node
Selection Expert Panel shall consist of up to the Maximum Number of
Experts specified for the Root Node Selection Expert Panel in Part B of
Appendix 6.

<<<

[.text-center]
=== APPENDIX 8
[.text-center]
=== GUIDELINES FOR SLASHING
[.text-center]
=== PART A- SLASHING OF Q TOKENS WHICH ARE SELF STAKED TO VALIDATOR NODES
[width="100%",cols="15%,15%,40%,30%",options="header",]
|===
|*Severity of non-compliance* |*Description* |*Non-exhaustive List of
Examples* |*Maximum percentage of Q Tokens which are Self Staked to
Validator Node to be Slashed*
|*Level 1* |Very light misbehavior a|
* Availability below 96% down to 90% on a 1,000 validation cycle basis

|0.1%

|*Level 2* |Light misbehavior a|
* Availability below 90% down to 80% on a 1,000 validation cycle basis
* Extending a local fork, one of whose paths is invalid (building on an
invalid block)
* Initiating or co-signing empty blocks (without including Valid
Transactions)

|3.0%

|*Level 3* |Medium misbehavior a|
* Availability below 80% down to 60% on a 1,000 validation cycle basis
* Not validating and/or recording transactions on the Q Blockchain on a
first-come-first-served basis
* Abusive proposition of out-of-turn blocks
* Confirmation of transactions which are not Valid Transactions
* Accepting invalid blocks and forwarding in the network to peers

|10.0%

|*Level 4* |Severe misbehavior a|
* Availability below 60% down to 30% on a 1,000 validation cycle basis
* Breach of obligations set out in Article 4.5.1

|95.0%

|*Level 5* |Very severe misbehavior a|
* Availability below 30% on a 1,000 validation cycle basis
* Blacklisting of transactions or addresses
* Fraudulent transactions (e.g. signing double spend transactions)
* Ignoring voting transactions which are Valid Transactions
* Breach of obligations set out in Articles 4.5.2 or 4.5.3

|100%
|===

{empty} +

[.text-center]
=== PART B- SLASHING OF Q TOKENS WHICH ARE SELF STAKED TO ROOT NODES
[width="100%",cols="15%,15%,40%,30%",options="header",]
|===
|*Severity of non-compliance* |*Description* |*Non-exhaustive List of
Examples* |*Maximum percentage of Q Tokens which are Self Staked to Root
Node to be Slashed*
|*Level 1* |Light misbehavior a|
* Breach of obligations set out in Article 5.3.8

|0.1%

|*Level 2* |Medium misbehavior a|
* Repeated downtime
* Breach of obligations set out in Articles 5.3.1, 5.3.4 or 5.3.11

|3.0%

|*Level 3* |Severe misbehavior a|
* Prolonged downtime (>24 hours)
* Breach of obligations set out in Articles 5.3.2, 5.3.3, 5.3.9
* Breach of obligations set out in Articles 5.3.1 or 5.3.4 two or more
times in a row

|10%

|*Level 4* |Very severe misbehavior a|
* Breach of obligations set out in Articles 5.3.5, 5.3.6, 5.3.7, 5.3.10,
5.3.12 or 5.3.13

|100%
|===

<<<

[.text-center]
=== APPENDIX 9
[.text-center]
=== WITHDRAWAL OF STAKE PROCEDURE
[horizontal.text-left]
1.:: If, at any time, the Operator of a node on Q requests the withdrawal
of any Q Tokens it has Self Staked to such node on Q, but, prior to the
expiry of the relevant Q Token Time Lock Period, a Slashing Proposal is
made in respect of some or all of the Q Tokens Self Staked to such node,
then (x) the aggregate number of Q Tokens Self Staked to such node at
such time, (y) the number of Self Staked Q Tokens whose release from
Stake has been requested by the Operator and (z) the number of Self
Staked Q Tokens to be Slashed in accordance with the relevant Slashing
Proposal (the result rounded down to the nearest 1/10^18^ of a Q Token)
shall be compared and:
+
[horizontal]
(i)::: if the sum of the number of Self Staked Q Tokens whose release from
Stake has been requested by the Operator and the number of Self Staked Q
Tokens to be Slashed in accordance with the relevant Slashing Proposal
is equal to or lower than the aggregate number of Q Tokens Self Staked
to such node at such time, a number of Self Staked Q Tokens equal to the
number of Self Staked Q Tokens whose release from Stake has been
requested by the Operator shall be released from Stake upon the expiry
of the Q Token Time Lock Period;
(ii)::: if the sum of the number of Self Staked Q Tokens whose release from
Stake has been requested by the Operator and the number of Self Staked Q
Tokens to be Slashed in accordance with the relevant Slashing Proposal
is greater than the aggregate number of Q Tokens Self Staked to such
node at such time, then, subject to Paragraph 2:
+
[horizontal]
(A):::: a number of Self Staked Q Tokens equal to (I) the aggregate number
of Q Tokens Self Staked to such node at such time _minus_ (II) the
number of Self Staked Q Tokens to be Slashed in accordance with the
relevant Slashing Proposal shall be released from Stake upon the expiry
of the Q Token Time Lock Period;
(B):::: if the Slashing Proposal is not accepted in accordance with
Appendix 5, a number of Self Staked Q Tokens equal to (1) the number of
Self Staked Q Tokens whose release from Stake has been requested by the
Operator _minus_ (2) the number of Q Tokens released from Stake pursuant
to Paragraph (A) shall be released from Stake upon the later of (I) the
expiry of the Q Token Time Lock Period and (II) the expiry of the Voting
Period in respect of the Voting Proposal; and
\(C):::: if the Slashing Proposal is accepted in accordance with Appendix 5,
a number of Self Staked Q Tokens equal to the number of Self Staked Q
Tokens to be Slashed in accordance with the relevant Slashing Proposal
shall be Slashed (the "*Relevant Slashed Q Tokens*").
2.:: The procedure set out in Paragraph 1 shall apply separately in
connection with each relevant Slashing Proposal made prior to the expiry
of the relevant Q Token Time Lock Period. However, for the purposes of
any calculations made in connection with each second and subsequent
Slashing Proposals, the aggregate number of Q Tokens Self Staked to such
node at any time shall be reduced to take into account the aggregate
Relevant Slashed Q Tokens determined under Paragraph 1 in connection
with all previous Slashing Proposals. No Self Staked Q Tokens shall be
released from Stake until the Relevant Slashed Q Tokens (if any) in
respect of the last Slashing Proposal made prior to the expiry of the
relevant Q Token Time Lock Period have been calculated.