*This document constitutes a summary of the Rules of the VTBCommunity Foundation that are registered with the Registrar of Foundations in Gibraltar. 

PRIVATE FOUNDATIONS ACT 2017

Foundation Rules Summary* of VTBCOMMUNITY FOUNDATION (“the Foundation”)

Date: 21 July 2021, amended 17 December 2021


INDEX TO THE RULES

PART 1

INTERPRETATION AND CONSTITUTION

1. Defined Terms

2. Name

3. Applicability of standard form Rules

4. Initial Endowment and Property

5. Registered Office

PART 2

PARTIES

6. The Council

7. Reserved Powers of the Founders

8. Powers and Duties of the Council

9. Appointment, resignation or removal of Councillors

10. Proceedings of the Council

11. The Guardian

12. Powers and Duties of the Guardian

13. Disclosure of Interest by Council or Guardian

PART 3

BENEFICIARIES AND DISTRIBUTIONS

14. Beneficiaries

15. Power of Accumulation and Advancement

16. Distributions

PART 4

AMENDING THE CHARTER AND RULES

17. Revocation and Variation

18. Severability

PART 5

TRANSFER OF REGISTRATION AND WINDING UP

19. Transfer of Registration

20. Dissolution and Winding up

SCHEDULES

Schedule 1 – Guardian

Schedule 2 – Beneficiaries

Schedule 3 – Corporate Councillor


PART 1

INTERPRETATION AND CONSTITUTION

1. Defined Terms

  • “Act” shall mean the Private Foundations Act 2017 including any modification or re-enactment thereof.
  • “Bankruptcy” includes individual insolvency proceedings in a jurisdiction other than Gibraltar which have an effect similar to that of bankruptcy;
  • “Beneficiaries” any person appointed as a beneficiary of the Foundation in accordance with rule 14 and who is identified or identifiable in Schedule 2 to these Rules;
  • “Business Days” shall mean a day, other than a Saturday, Sunday or public holiday in Gibraltar, when banks in Gibraltar are open for business.
  • “Chairperson” has the meaning given in rule 10.1;
  • “Charter” shall mean the charter of the Foundation in its present form or as amended from time to time;
  • “Class VII Licence” shall mean a licence as defined in the Act;
  • “Constitution” shall mean these Foundation Rules together with the Foundation Charter;
  • “Corporate Councillor” means a Gibraltar resident body holding a Class VII Licence and as more particularly described in the Act
  • “Council” has the meaning given in rule 6.1;
  • “Councillors” means a member of the Council;
  • “Disenfranchised Beneficiary” has the meaning given in the Act;
  • “Enfranchised Beneficiary” means a beneficiary who is not a Disenfranchised Beneficiary;
  • “Foundation” shall mean “VTBCommunity Foundation”;
  • “Founders” means founding members;
  • “Guardian”, if any, means a person or persons acting jointly who is appointed in accordance with the Constitution or the Act and as further specified in rule 11;
  • “Initial Endowment” shall mean the assets endowed by the Founders and constituting the initial property of the Foundation;
  • “Member” shall, unless otherwise stated mean any natural or legal person appointed to the Council;
  • “Minister” shall mean the Minister from time to time responsible for financial services in Gibraltar;
  • “Person” shall, where appropriate, mean any natural or legal person;
  • “Property” has the meaning given in rule 4.2;
  • “Purpose” shall mean the purposes or objects of the Foundation as more particularly described in the Charter;
  • “Register” shall mean the Register of Foundations kept by the Registrar;
  • “Registered Office” shall mean the registered office of the Foundation;
  • “Registrar” shall mean the Registrar of Foundations in Gibraltar;
  • “Reserved Powers” shall mean the powers reserved to the Founders;
  • “Rules” shall mean these Foundation Rules;
    “Super Majority” of the Council means 65% or greater of votes where the Council consists of 3 members or less, or 75% or greater of votes where the Council consists of 4 or more Members.
  • “Writing” means the representation or reproduction of words, symbols or other information in a visible form by any method or combination of methods, whether sent or supplied in electronic form or otherwise.
    • (a) Unless the context otherwise requires, other words or expressions contained in these articles bear the same meaning as in the Act as in force on the date when these articles become binding on the company.
    • (b) When any provision of the Act is referred to, the reference is to that provision as modified by any statute for the time being in force.

2. Name

A private Foundation under the name of VTBCOMMUNITY FOUNDATION is hereby formed and constituted in accordance with the Charter and the provisions of the Act.

3. Applicability of standard form Rules

The form of foundation rules of a private foundation that may from time to time be prescribed by the Minister under the Act shall, unless specific reference is made to the contrary in these Rules, not apply to the Foundation.

4. Initial Endowment and Property

4.1 The Founders have endowed the Foundation with the Initial Endowment as more fully described in the Foundation Charter.

4.2 The property of the Foundation shall consist of the Initial Endowment and any other assets, which may consist of shares or securities in companies, interests in any other bodies corporate, allocations, legacies and other forms of allowances, subsidy or other contributions endowed to the Foundation from all Persons, private and public bodies.

4.3 A Person who endows assets to the Foundation after its registration shall not acquire the powers of the founders as a result.

5. Registered Office

5.1 The Foundation may, at any time, change its registered office upon a resolution of the Council.

5.2 Upon a change in the registered office, the Foundation shall, within 21 days from the date of the change, file with the Registrar, a notice of the change, in the prescribed form.


PART 2

PARTIES

6. The Council

6.1 The Council shall be the governing body of the Foundation and shall have such powers as set out in rule 8.

6.2 The Council shall execute and administer the Foundation and exercise its functions in accordance with the Constitution and the Act.

6.3 The Council shall have at least three Members and shall at all times have a Gibraltar resident body corporate holding a Class VII Licence as a member “Corporate Councillor”. If for any reason, the number of Members of the Council falls below the required minimum of three, the Council may only act in accordance with rule 9.3 to appoint further Members to the Council such that the required minimum number of Members is restored.

6.4 Nothing in these Rules shall prevent the Corporate Councillor from being paid or reimbursed from the Property of the Foundation for all expenses and liabilities properly incurred in connection with the Foundation including any reasonable fees charged by the Corporate Councillor either on a fixed basis or a time spent basis for services provided to the Foundation as Corporate Councillor of the Foundation.

7. Reserved Powers of the Founders

The Founders shall have no Reserved Powers.

8. Powers and Duties of the Councillors

8.1 The Councillors shall exercise all of the powers of the Foundation.

8.2 The Corporate Councillor shall:

(a) attend all meetings of the Council and keep minutes;

(b) keep the following documents at its Registered Office for a minimum period of 5 years:

(i) all documents filed with the Registrar;

(ii) proper books of account.

8.3 The Council may do such acts as may be necessary or conducive to further and attain the Purpose.

8.4 The Council shall supervise the management and conduct of the Foundation and shall discharge the duties and obligations attached to a council as provided under the Act.

8.5 The Council shall act honestly and in good faith with a view to promoting the best interests and purposes of the Foundation.

8.6 The Council shall exercise its duties with due care, diligence and skill.

8.7 The Council may delegate any of the powers which are conferred to it under these Rules or by the Act to such Person or committee, by such means (including by power of attorney), to such extent, in relation to such matters or territories, and on such terms and conditions as it thinks fit.

9. Appointment, resignation or removal of Councillors

9.1 Subject to rule 6.3, any person may be appointed as a Member of the Council notwithstanding that he, she or it is domiciled or resident outside Gibraltar.

9.2 The first Members of the Council, being a Corporate Councillor as required by rule 6.3 and specified in Schedule 3, and the Founders.

9.3 The power of appointing or removing a Councillor shall be exercisable by a Super Majority vote of the Council.

9.4 The appointment of a person as a Member of the Council shall not be valid unless that Person, prior to their appointment, has signed and delivered to the Registrar, their consent to be a Member.

9.5 A Member, other than a sole Member, may resign their office by delivering a written notice of resignation to the Council, and lodging with the Registrar a declaration to the effect that they have given such notice, not less than 7 days before the day on which they intend to cease to act as such.

9.6 A Member shall cease to be a member immediately upon:

(a) the taking effect of their resignation;

(b) their death;

(c) their removal from office by the Court;

(d) the Foundation ceasing to be registered under the Act;

(e) their Bankruptcy or in the case of the Corporate Councillor the presentation of a petition for the liquidation or winding up thereof;

(f) their disqualification, in respect of a Corporate Councillor, from acting as a Councillor including by way of loss of licence.

(g) the occurrence of any other event which disqualifies them from being a Member.

9.8 The Council shall, in Writing, within 21 days from the date of any change in its membership, file a return of the change with the Registrar.

9.9 A Councillor will not, in the absence of fraud or willful misconduct, be liable for anything done or omitted by a Councillor in the discharge or purported discharge of their functions.

10. Proceedings of the Council

10.1 Chairperson and Executive

(a) The Council may appoint a Member to chair their meetings.

(b) The Person so appointed for the time being will be known as the Chairperson.

(c) The Council may terminate the Chairperson’s appointment at any time.

(d) If the Chairperson appointed above resigns or is otherwise unable to act in such capacity, the Members shall elect one of their number as chairperson of the meeting of Members and determine the period for which he is to hold office.

(e) Where no Chairperson is elected under the preceding paragraphs, or if the Person appointed is unwilling to preside or where at a meeting of the Council the Chairperson is not present within 10 minutes after the time appointed for the commencement of the meeting, the Members of the Council present may choose one of their number to be chairperson of the meeting.

(f) The Council may appoint a Member to a specific executive role including but not limited to: CEO, CTO, COO for a period of one year. The duty of each executive will be defined and agreed upon by the Council.

10.2 Notice of the meeting

(a) A Member may convene a meeting of the Council by giving notice in accordance with this paragraph.

(b) A notice of a meeting of the Council shall be sent to every Member at least 10 Business Days prior to the date of the meeting and shall include the date, time, and place of the meeting and the matters to be discussed.

(c) An irregularity in the notice of a meeting is waived where all the Members entitled to receive notice of the meeting attend the meeting without protest as to the irregularity or where all the Members entitled to receive notice of the meeting agree to the waiver.

10.3 Methods of holding meetings

A meeting of the Members may be held either:

(a) by a number of the Members who constitute a quorum, being assembled together at the place, date, and time appointed for the meeting; or
(b) by means of audio, or audio and visual, communication by which all the Members participating and constituting a quorum can simultaneously hear each other throughout the meeting.

10.4 Meetings held by electronic means

A meeting held by electronic means must comply with rules for meetings, including chairing and the taking of minutes.

10.5. Quorum

(c) A quorum for a meeting of the Council may be fixed from time to time by a decision of the Council, and unless so fixed shall be 50% of the Councillors.

(a) No business may be transacted at a meeting of the Council if a quorum is not present.

10.6 Voting

(a) Every Member has one vote.

(b) In case of equality of votes, the Chairperson or other Person chairing the meeting shall have a casting vote.

(c) A resolution of the Members is passed if it is agreed to by all the Members present without dissent or if a majority of the votes cast on it are in favour of it.

(d) A Member present at a meeting of the Council is presumed to have agreed to, and to have voted in favour of, a resolution of the Members unless they expressly dissent from or votes against the resolution at the meeting.

10.7 Minutes

The Corporate Councillor shall ensure that minutes are kept of all proceedings at meetings of the Council and of decisions made by the Council otherwise than in meetings.

10.8 Resolution in Writing

(a) A resolution in Writing, signed or assented to (whether by electronic means or otherwise) by all Members then entitled to receive notice of a meeting, is as valid and effective as if it had been passed at a meeting of the Council duly convened and held.

(b) Any such resolution may consist of several documents (including facsimile or other similar means of communication) in like form each signed or assented to (whether by electronic means or otherwise) by one or more Members.

(c) A copy of any such resolution must be entered in the minute book of the proceedings of the Council.

10.9 Other proceedings
Except as provided in these Rules, the Council may regulate its own procedure. The Council may engage advisors, consultants and/or employees.

11. The Guardian

11.1 The Founders have appointed the first Guardian.

11.2 The Guardian or a committee of Guardians may be or consist of Persons.

11.3 The first Guardian is listed in Schedule 1.

11.4 The Council may propose any Person for appointment as a Guardian. All appointments of subsequent Guardian(s), shall be made in accordance with the requirements of the Act and the Constitution by deed, on such terms and subject to such conditions as a Super Majority of the Council may agree with the Guardian(s) and notice thereof containing the acceptance of the appointment shall be forthwith delivered to the Members and shall be effective when the document or a certified copy thereof is received by the Council.

11.5 Where only one Guardian has been appointed, they shall on their appointment sign a written acceptance which shall contain a nomination of their successor. Such nomination may not be revoked by them unless such revocation contains a further nomination of the Guardian’s successor.

11.6 Where only one Guardian has been appointed, a new Guardian shall be appointed whenever the Guardian for the time being (being an individual) dies or wishes to retire or becomes incapable of acting as Guardian or (being a company) is put into liquidation (whether voluntary or compulsory) or otherwise ceases to exist or otherwise becomes incapable of acting as Guardian or passes a resolution to the effect that it wishes to retire from the position of Guardian provided that a Guardian wishing to be discharged shall not be discharged unless he contemporaneously appoints a new Guardian.

11.7 Where a Guardian intends to retire as Guardian of the Foundation they shall give notice in Writing of their intention to the Foundation, at least 7 Business Days before the Guardian intends to cease to act.

11.8 All appointments of a Guardian, shall be made by deed and notice thereof containing the acceptance of the appointment shall be forthwith delivered to the Members and shall be effective when the document or a certified copy thereof is received by the Council.

11.9 On the death of a sole Guardian being an individual, their successor shall be such Person as they shall previously have nominated in Writing under paragraph 11.4.

11.10 If at any time there shall be for any reason no Guardian then the power of appointing a new Guardian shall be vested in the Council.

12. Powers and duties of the Guardian

12.1 Other than in any circumstances where the Council must appoint a new Guardian and a successor is not specified by the Guardian in accordance with clause 11 or the successor is incapable of being or refuses to be the Guardian, the Guardian shall have the right to veto any proposal (whether in the form of a written resolution, or item to be tabled at a meeting of the Councillors or otherwise) and whether to make a payment or apply the assets of the Foundation, designate a Beneficiary, or in respect of any other matter relating to the affairs of the Foundation if, in the reasonable opinion of the Guardian the proposal is inconsistent with, or will fail to, further the Purpose. In the event of use of any such veto right, the Guardian shall work with the Council to seek resolution to their views on the inconsistent with the Purpose in accordance with procedures for such circumstances agreed from time to time between the Council and the Guardian.

12.2 Without prejudice to all other rights and powers, the Guardian shall:

(a) be given notice of all Council meetings and have delivered to them all agenda, Council papers and related materials;

(b) be entitled to attend meetings of the Council and participate in any discussions of items raised, but shall have no vote;

(c) act honestly and in good faith with a view to the interests of the Beneficiaries and the Purpose of the Foundation;

(d) exercise the care, diligence and skill which a reasonably prudent Person would exercise in comparable circumstances and be acting in a professional capacity exercise the care, diligence and skill which a professional Guardian of a foundation would exercise in comparable circumstances;

(e) save where they are also a Beneficiary of the Foundation owe a fiduciary duty to the Beneficiaries of the Foundation and where there are no Beneficiaries shall owe a fiduciary duty to the Founders of the Foundation to apply their powers towards the attainment of the Purpose of the Foundation;

(f) not derive, directly or indirectly, any profit from their appointment save, where applicable, in their capacity as Beneficiary of the Foundation;

(g) not cause or permit any other Person to so derive any such profit save, where applicable, in their capacity as Beneficiary of the Foundation; or

(h) not on their own account enter into any transaction with the Foundation, or relating to the property of the Foundation, which may result in any such profit save, where applicable, in their capacity as Beneficiary of the Foundation.

12.3 The Guardian shall have the power to:

(a) request any information and documents from the Council in respect of the affairs and activities of the Foundation;

(b) summon a meeting of the Council by giving notice in the manner provided in rule 10.2.

12.4 Where a committee of Guardians has been appointed, decisions shall be taken in the committee at a majority of the Guardians.

12.5 The Guardian will not, in the absence of fraud or willful misconduct, be liable for anything done or omitted by the Guardian in the discharge or purported discharge of their functions.

12.6 Any Guardian who is also a Beneficiary may give or refrain from giving any consent or may exercise any power conferred by these Rules or the Act, notwithstanding that they have a personal interest in the mode or result of the exercise or non-exercise of the power concerned.

12.7 Nothing in these Rules shall prevent a Guardian from being paid or reimbursed from the Property of the Foundation for all expenses and liabilities properly incurred in connection with the Foundation including any reasonable fees charged by the Guardian either on a fixed basis or a time spent basis for services provided to the Foundation as Guardian of the Foundation.

13. Disclosure of Interest by Council or Guardian

13.1 A Member shall, upon becoming aware that they have an interest in a transaction or proposed transaction with the Foundation, forthwith disclose the nature and extent of their interest at a meeting of the Council as well as, where the monetary value of the Member’s interest can be quantified, the monetary value of that interest.

13.3 A failure by a Member to comply with paragraph 13.1 shall not affect the validity of a transaction entered into by the Foundation or the Member.

13.4 This rule shall apply to a Guardian as it applies to a Member of the Council.


PART 3

BENEFICIARIES AND DISTRIBUTIONS

14. Beneficiaries

14.1 The first Beneficiaries of the Foundation are listed in Schedule 2 and shall be Disenfranchised Beneficiaries. The Council may from time to time by way of Super Majority appoint such further Beneficiaries as it, in its absolute discretion, sees fit provided such further Beneficiaries will be Disenfranchised Beneficiaries.

14.2 The name of any further beneficiary or the description of any class of Beneficiaries appointed under rule 14.1 above will be entered into Schedule 2 hereof, within 14 Business Days of the Council’s decision to make such appointment.

14.3 The Council may impose an obligation on a Beneficiary as a condition of benefit, whether on the appointment of the Beneficiary, or upon distribution.

14.4 The Council may revocably or irrevocably exclude a Beneficiary from benefit. In such cases, the Beneficiary in question must be removed from the Schedule 2 hereof, within 14 Business Days of the Council’s decision to make such exclusion.

14.5 A Beneficiary may, by notice in Writing to the Council, disclaim their interest in the Foundation or any part of it, whether or not he has received any benefit from it, and may state that such disclaimer is to be temporary or capable of being revoked in the manner and circumstances specified therein.

15. Power of accumulation and advancement

15.1 The Council may raise any sum or sums out of the capital of the assets of the Foundation and pay or apply the same to or for the benefit of all or any one or more exclusive of the other or others of the Beneficiaries and in such respective amounts if more than one and generally in such manner as the Council will in their like discretion think fit.

15.2 The Council may pay or transfer or otherwise assure the whole or any part or parts of the capital or income of the assets of the Foundation to any other Foundation or the trustees for the time being of any other trust wheresoever established or existing (whether governed by the laws of Gibraltar or by the law of any other state or territory) under which any one or more of the Beneficiaries are interested notwithstanding that such other trust may also contain trusts powers and provisions (discretionary or otherwise) in favour of some other Person or Persons or objects if the Council will in their absolute discretion consider such payment to be for the benefit of such one or more of the Beneficiaries.

15.3 The Council may settle capital on all or any one or more of the Beneficiaries and any settlement made by the Council under this present power upon or for the benefit of anyone to promote or more of the Beneficiaries as aforesaid may be created in and under the law of any part of the world (being a part of the world the local law whereof recognises settlements of the kind proposed to be made) and may contain such trusts powers and provisions (discretionary or otherwise) whatsoever as the Council will think proper for the benefit of such Beneficiaries.

15.4 The Council may apply the whole or any part or parts of the capital or income of the property of the Foundation in or towards the payment or discharge of any corporation tax, duty, inheritance tax, capital gains tax, wealth tax, income tax, stamp duty or other fiscal imposition whatsoever levied or imposed in any part of the world upon the Foundation or otherwise in respect of any other Foundation in which the Beneficiaries or any one or more of them will be interested wherever such Foundation will be resident and wherever such Foundation is established or existing and whether governed by the laws of Gibraltar or by the law of any other state or territory.

16. Distributions

16.1 The income and Property of the Foundation must be applied solely towards the promotion of the Purpose.

16.2 A distribution of the income and Property to a Beneficiary shall not be validly made unless it is signed by a majority of all the Councillors then appointed.

16.3 Subject to rule 16.1, the income and Property of the Foundation shall be distributed, accumulated or applied by the Councillors as they see fit.


PART 4

AMENDING THE CHARTER AND RULES

17. Revocation and Variation

17.1 The Charter (including any amendment to the appended Project Whitepaper contained therein) and/or the Rules can only be amended by a Super Majority of the Council.

17.2 No amendment that is inconsistent with the provisions of the Act shall be valid.

17.3 A copy of every resolution amending the Charter or Rules, together with a copy of the Foundation’s Charter or Rules as amended must be sent to the Registrar in accordance with the Act.

18. Severability

In the event that any provision of these Rules including any of its schedules is invalid, illegal or unenforceable it will not affect the validity, legality or enforceability of any other provision of these Rules.


PART 5

TRANSFER OF REGISTRATION AND WINDING UP

19. Transfer of Registration

The Foundation may apply to the Registrar to be removed from the Register and register under the law of another jurisdiction upon a resolution of the Council, in accordance with the provisions of the Act.

20. Dissolution and winding up

20.1 The Foundation may be wound up voluntarily by the Council in accordance with the provisions of the Act.

20.2 If upon the winding up of the Foundation, the assets are not capable of being distributed in accordance with section 87 (a) or (b) of the Act, the assets shall be distributed in equal proportion to one or more default recipients as described below.

20.3 The default recipients shall be one or more charitable entities pursuing objectives consistent with the Purpose.


SCHEDULE 1

GUARDIAN

Ince Consultancy (Gibraltar) Limited (company registration number 107474) of 6.20 World Trade Center, 6 Bayside Road, Gibraltar.

SCHEDULE 2

BENEFICIARIES

For the time being, the only beneficiary of the Foundation shall be the VTBCOMMUNITY PROJECT as outlined in the White Paper appended to the Foundation Charter which comprises the VTBCommunity protocol and the associated community of VTBC token holders.

The VTBCOMMUNITY PROJECT shall be a Disenfranchised Beneficiary.

SCHEDULE 3

CORPORATE COUNCILLOR

The first Corporate Councillor is: Ince Consultancy (Gibraltar) Limited (company registration number 107474) of 6.20 World Trade Center, 6 Bayside Road, Gibraltar.