NapoleonX.ai
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NapoleonX.ai

NapoleonX.ai

Addendum of NPX Licensing Right mechanism

As a reminder, the NPX token bears 2 native rights:

★ The access to the trading signals library on napoleonx.ai. Those signals are available in a timely manner, according to the number of NPX hold.

★ The licensing right to the DAFs allowing the NPX token holders to benefit from a fee sharing (85% of the performance fees generated equally distributed to the 29.8M of NPX tokens).

In addition, the team has added a new right so that the NPX bears also partly a mean of payment to have access to the NapBots services.

We will below focus on the Licensing Right mechanism and computation.

2020 DAF’s Management and Performance Fees

Since January 2020, NPX License Fees have been generated and paid, based on the Management Fees of the DAF 1 which has been assimilated to the Napoleon Bitcoin Fund (or “NBF”) launched by Napoleon Asset Management.

During 2020, several agreements have been concluded to launch and create additional DAFs. The first agreement (for the DAF2), signed in June 2020, has not yet conducted to the launch of such DAF. Another agreement has led to a DAF3 which has generated some Performance Fees as of December 2020.

Main principles of NPX Licensing Right

Before going into more details, it is worth to explain the main principles ruling the NPX Licensing Right:

Subject to the registration of their NPX on the www.napoleonx.ai platform and their approved KYC, NPX token holders are eligible to receive NPX License Fees, based on two main principles:

○ They should have continuously registered and detained their NPX on a Registered Address for the whole License Fee Generation Timeframe,

  • As a consequence, at the end of a License Fee Generation Timeframe, the amount of License Fees generating over such Timeframe is added to the License Fee Balance (or directly to the Payment Balance) of the NPX token holder.

○ They should have continuously registered and detained their NPX on a Registered Address from the end of the License Fee Generation Timeframe to the payment date of the corresponding fee.

  • If the NPX token holder has transferred some of his NPX before the payment date, then, the License Fee due to payment will be reduced to the share of registered NPX he has continuously kept since the end of the License Fee Generation Timeframe.

● For the sake of simplification, we have decided to define quarters as License Fee Generation Timeframes and also to make quarterly payments. Hence:

○ What we called Management Fee Generation Timeframe (MFGT) and Performance Fee Generation Timeframe (PFGT) are assimilated to quarters, from Q1 to Q4.

Monthly Payment Dates are replaced by Quarterly Payment Dates.

● Due to the uncertainty of Performance Fees versus Management Fees, they cannot be treated the same way.

○ For what concerns Performance Fees, the final amount can only be known at Dec, 31st of each year, so that the Accrued License Fees cannot really be computed but only a Provision for Accrued License Fees during the year. Besides, having decided to define the PFGT as the quarter, we apply the following rule to compute the according Performance Fees:

  • At the end of each quarter, a Provision for Performance Fee will be computed and thus a Provision for Accrued License Fee per NPX token continuously held and registered since the beginning of the year, called Pu. Then for any NPX token the following table will apply to compute the corresponding Provision for Accrued License Fee:
  • At the end of each year, the global amount of Performance Fees is known, and the corresponding License Fees can be computed for a given NPX token holder (from the table shown above for Q4 as a quarter of computation). Three-quarters of such amount will be added to the License Fee Balance of such NPX token holder while one quarter will be added to his Payment Balance.
  • Then at the end of each quarter, one quarter will be removed from the License Fee Balance while added to the Payment Balance. Besides, a provision for the Performance Fees will be computed and as a consequence a corresponding Provision for Accrued License Fee will be updated on the NPX token holder dashboard.
  • At Payment Date, if the same number of NPX has been continuously held, then the payment is made (subject to Payment Balance being greater than the Eligible Threshold) and Payment Balance is set to 0.

○ For what concerns the Management Fees, the value of Management Fees is known at the end of each MFGT (quarter) so that the corresponding License Fee can also be computed. Such amount of License Fee will directly increase the Payment Balance so that it may be paid at the next Payment Date. Besides, the Accrued License Fee will be updated on a daily basis. The License Fee Balance will remain at 0 since any License Fee will be set to be paid on the next Payment Date.

Payments will not be made in ETH as initially planned but in USDT, or any other stablecoin available on the Ethereum blockchain in the event that USDT is no longer available. The main reason behind this change is the volatility of the ETH and potential conversion rate issues.

Given these principles, we have decided to make an exception to allow anyone registering his NPX tokens on the www.napoleonx.ai platform before the end of January 2021, to have access to the License Fee generated by the DAF3, for all his NPX tokens held at Dec 31, 2020. As a consequence, the first Payment Date of 2021 will be in February, 15th at the latest, instead of January.

As a precision, if a NPX token holder holds his token through several wallets, he will perceive his quote part on each wallet, to avoid any potential error in terms of wallet signature and continuous holding period.

NPX continuously held and registered during a License Fee Generation Timeframe (MFGT or PFGT)

For any License Fee Generation Timeframe (MFGT or PFGT), a NPX token shall generate a License Fee if and only if it has been regularly registered and held continuously during the whole License Fee Generation Timeframe and until the Payment Date.

The following scheme explain several cases where the NPX are eligible to License Fee (green cases) and where they are not (yellow cases).

DAF3 Exception for 2020

By exception and due to the delay for the setup enabling to add the Perf Fee mechanism, an extension is given to NPX token holders to finalize their registration process and benefit from the License Fee due from the DAF3’s Performance Fees generated on 2020.

As a consequence, any NPX held on December 31st, 2020 will generate full rights derived from DAF3’s Performance Fees, subject to the NPX token holder registering his NPX tokens before Jan 31st 2021 and continuously holding them until Payment Date, as explained below:

Registration

To regularly register his token, a token holder will need:

  • to pass a KYC process aiming at confirming his identity. By law, this process will require two different IDs (among passport, national ID and driving licence) since it is done online,
  • to approve the license agreement,
  • to register the addresses of the tokens on the napoleonx.ai platform by signing a message from such addresses,
  • to keep his tokens on these addresses until the payment date: any token moved before this date will lost its rights toward the corresponding period.

Payment will occur at Payment Date that shall not happen more than 30 days after the end of each quarter (exception for February 15th 2021).

At Payment Date:

  • For each NPX token holder having a Payment Balance >= 12€, the amount of the Payment Balance will be converted in USDT at market price, a provision of 0,12€ equivalent USDT will be deducted to pay the gas and the remaining balance will be sent to the payment address given and validated by the token holder. After payment, the balance of the token holder is set back to 0€.
  • For each NPX token holder having a Payment Balance < 10€, no payment will be made, and the balance will be kept for the next quarter, so that when the cumulated due amount shall exceed the 12€ threshold, it will be paid according to the previous point.

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Napoleon Group™

Napoleon Group™

Fully algorithmic, scalable & decentralized crypto asset manager piloting trading bots, founded by former multibillion-dollar managers. https://www.napoleonx.ai