# Fabrica Trust Agreement This Trust Agreement (this "**Agreement**") is entered into by the Grantor through the creation of a Property Token. The identifying information of this trust (the "**Trust**") may be found in the Property Token to which this Agreement is attached. ### Recitals - Whereas blockchain Smart Contracts provide a secure and interoperable way of representing ownership of digital assets through the use of an electronic ledger to immutably track, document, and verify all transactions. As a consequence, new systems and methods are emerging to store, interact with, and transact on real and digital assets. - Whereas the grantor wants to link ownership of real property to a Property Token so as to benefit from digital operations and services. - Whereas on issuance of the Property Token, the grantor will attach this Agreement to the Property Token, and intends for this Agreement to act as the operating agreement of the entity holding the Property. For the purposes of interoperability and standardization, the grantor and any subsequent party to this agreement intend to keep all the identifying information of this Agreement stored in the Property Token to which this contract has been attached. All the operations, definitions, and procedures related to the Property Token and the Trust will be stored in this Agreement. - Whereas the purpose and design of this Trust allow the beneficiary to use blockchain technology to facilitate transfer and utilization of property ownership. To the extent provided in this Agreement, the trustee's power and authority to deal with the Property are subject to the direction of the beneficiary, who holds all present economic and possessory rights to the Property, subject to the contingent equitable interests of determinable future beneficiaries and legal successors. The beneficiary (who may change from time to time and is at all times defined as the party presently holding ultimate control over the Property Token) is entitled to income, maintains the sole right of termination, and is treated as the owner of the Property for all federal, state, and local tax purposes. - Whereas the parties intend to treat all valid operations done via blockchain on the Property Token as final, with the same force and effect as a fully executed agreement. Further, the parties intend to treat digital signatures with the same legal consequence as wet signatures. - Now, therefore, in consideration of the agreements and obligations set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: ### 1. Trust Purpose ### 1. The purpose of the Trust is to create a legally enforceable link such that ownership of the Property Token determines ownership of the Property, so as to allow for time-efficient, cost-effective, accurate, and secure ownership, transfer, use, and enjoyment of real property title in the digital environment (the "**Trust Purpose**"). 2. On creation, the Trust will take and hold title to the Property, and ownership of the Trust will be represented by ownership of the Property Token. Regardless of the sale, hypothecation, or other transfer of the Property Token, title to the Property will remain in the Trust until such time as the then-present Beneficiary (or another authorized party) distributes the Property out of the Trust. To facilitate the Trust Purpose and maintain the integrity of the token-property relationship, the Trustee shall not execute or deliver any deed or other agreement transferring the Property out of the Trust unless and until (a) the Property Token has been burned through the `burn` or `burnBatch` functions of the Token Contract, making it permanently untransferrable, or (b) the dissolution is authorized under **Sections 10.2, 10.3, or 10.4** of this Agreement. 3. Subject to **Sections 6 and 7**, the owner(s) of the Account or Smart Wallet holding the Property Token shall be the Beneficiary of the Trust and have the right to appoint the Trustee. All rights and obligations in this Agreement shall at all times be linked to the owner of the Property Token, provided that such ownership is established through a valid Account or Smart Wallet, and not merely through temporary custody by a Functional Contract. Rightful ownership (as distinct from temporary custody) of the Property Token confers full present beneficial ownership of the Property, including all economic and possessory rights, subject to the contingent equitable interests of other Beneficial Interest Holders as defined in **Section 2.26**. ### 2. Definitions ### 1. **Account** means an Externally Owned Account (EOA) on a Blockchain Network, which is an Address controlled directly by one or more private keys held by individuals or entities. 2. **Address** means a public key address on a Blockchain Network. 3. **Beneficiary** means the individual(s) or entity(ies) holding present beneficial ownership of the Trust and the Owner Rights as determined under **Section 7**. Beneficial ownership is ordinarily established by control of the Account or Contract Account holding the Property Token, but may differ from the current onchain holder due to Functional Contract custody (**Section 7.3(b)**), unauthorized transfers (**Section 7.5**), or alternative dissolution upon loss of token control (**Sections 10.2 and 10.3**). The Beneficiary is one of the Beneficial Interest Holders, but the term "Beneficiary" as used in this Agreement refers to the present interest holder unless otherwise indicated. In the event the Property Token has not yet been minted, or has been minted but has not yet been owned by any Account, the Beneficiary shall be the original Grantor. In the event ownership of the Property Token is fractionalized (as discussed further in **Sections 6.1. and 7.3.**), then the defined term Beneficiary as used in this Agreement shall apply to the various owners of the Property Token as a group. 4. **Blockchain Network** means any distributed ledger technology network used to maintain records of ownership and management of the Property Token to which this Agreement is attached. The relevant blockchain network may change due to actions of the Beneficiary, including the wrapping of the Property Token to a different blockchain network or the minting of the Property Token on a different blockchain network. 5. **Confirmed Transaction** means a transaction that has been recorded on the Blockchain Network which is considered "finalized." A transaction on Ethereum is considered finalized when that transaction becomes part of a block on the chain with a supermajority link between two checkpoint blocks. Other Blockchain Networks maintain similar or different definitions of Confirmed Transactions that should be adhered to in the event of the transfer or minting of the Property Token on an alternative Blockchain Network aside from Ethereum. 6. **Contract Account** means an Address controlled by a Smart Contract. A Contract Account may either: (a) serve as a method of holding Property Tokens under the direct control of specific individuals or entities who thereby become Beneficiaries (a "**Smart Wallet**"), or (b) operate as a functional contract (such as escrow, bridge, or collateral management) where custody does not automatically confer beneficial ownership (a "**Functional Contract**"). 7. **Creation Date** means the date and time at which the Trust was created by the Grantor. 8. **Ethereum** means the Ethereum mainnet and the consensus blockchain for such mainnet (networkID:1, chainID:1) as recognized by the official Go Ethereum Client implemented at https://github.com/ethereum/go-ethereum as of the Creation Date. 9. **Grantor** is the individual or entity who creates the Trust and grants the Property to the Trust. 10. **Mint** means a Confirmed Transaction `mint()` or `mintBatch()` function on the Token Contract that results in the association of a Token ID to an Address. 11. **ERC-1155 Token (Token)** means a digital asset developed based on the ERC-1155 multi-asset standard, and tracked by the Token Contract on the Blockchain Network with a unique identification code (Token ID). In the event the Property Token to which this Agreement is attached references an alternative Blockchain Network, such Property Token may follow a different Token standard, or utilize a different definition of Token. 12. **Property** is the bundle of rights identified in the legal description stored in the Token Metadata under the fields `definition.claim` and `definition.offchainRegistrar`. The Property so described is the bundle of rights which is to be deeded into the Trust and held throughout the life of the Trust. 13. **Property Token** means a Token issued using the Token Contract. In this case, such Property Token should be assumed to reference the token and standard on the Blockchain Network on which that Property Token is tracked. In the event a Property Token is wrapped, or transferred, to an alternative Blockchain Network, the Property Token will reference the ultimate controlling interest Token at any present moment. 14. **Redeem** means the result of a Confirmed Transaction of the `burn` or `burnBatch` functions on the Token Contract that results in the permanent locking or removal of the Property Token from circulation. In the event the Property Token has been wrapped, or transferred, to an alternative Blockchain Network, it may be required to unwrap, or transfer back, the Property Token to the original Blockchain Network to execute the `burn` or `burnBatch` functions. Depending on which Blockchain Network the Property Token was minted, the specific function names may be different, but Redeeming such token shall refer to effectively locking the Property Token so that it becomes untransferrable forever into the future. 15. **Smart Contract** means the bytecode deployed on a specific Blockchain Network Address which acts as a program to execute and run a series of processes or interactions. 16. **Token Contract** means the Smart Contract used to maintain records of ownership and management of the Property Token to which this Agreement is attached. 17. **Token ID** means the unique and immutable identifier determined on Trust creation and assigned to the corresponding Property Token. The Token ID is generated based on the digital signature of multiple fields from the Token Metadata, including the precise language of this Agreement. 18. **Token Metadata** means the data directly stored within the Property Token as well as external data stored on IPFS (or similar immutable storage system) and linked within the Property Token itself (using the fields `definition` and `configuration`). These will always include Token ID, Trust Name (stored as `definition.holdingEntity`), and Property legal description (`definition.claim`). Other additional information may be included to simplify property identification, verify past ownership and other activities. Alternative Blockchain Networks may utilize different data configurations or definitions. 19. **Transfer** means any operation performed through the Token Contract that assigns the Property Token to a new non-null Address. 20. **Trustee** means the individual or entity appointed by the Beneficiary as the Trustee of the Trust. At creation of the Trust, the Trustee may also be appointed by the Grantor. 21. **Trust Name** means the name of the Trust, more particularly defined in the Token Metadata (in `definition.holdingEntity`). It is recommended to encode the Token ID in the Trust Name using Base32 Crockford encoding. 22. **Alternative Dissolution Event** means a dissolution of the Trust under **Sections 10.2, 10.3, or 10.4** without prior Redemption of the Property Token. 23. **Notice of Lost Token Control** means a sworn affidavit (or other sworn recordable instrument permitted by applicable law), in recordable form, executed under oath and notarized in the form (acknowledgment, jurat, or equivalent) required by the recording statutes of the jurisdiction where the Property is located, recorded with the relevant county recorder or equivalent recording authority in that jurisdiction, declaring that the Beneficiary (or their legal successor) has lost the ability to Redeem the Property Token. The Notice shall identify the Token ID, the Token Contract address, the Blockchain Network, and the last known Account or Contract Account holding the Property Token, shall describe the circumstances of loss, and shall state that, to the best of the claimant's knowledge, the Property Token is held by an Account or Smart Wallet at the time of recording. 24. **Quiet Period** means a period of ninety (90) calendar days commencing on the date a Notice of Lost Token Control is recorded with the relevant county recorder or equivalent recording authority, during which any interested party may contest the Notice or assert a competing claim to the Property or the Property Token. 25. **Void Token** means a Property Token that has been permanently dissociated from the Property and the Trust following an Alternative Dissolution Event. A Void Token confers no beneficial ownership rights, no Owner Rights, and no interest in the Property or the Trust, regardless of its continued existence on the Blockchain Network. For the avoidance of doubt, while a Void Token may continue to exist as a controllable electronic record under UCC Article 12, it shall confer no rights under this Agreement. 26. **Beneficial Interest Holders** means, collectively, (a) the present Beneficiary, (b) any person who would become a Beneficiary upon a valid Transfer of the Property Token under the objective mechanics of **Section 7** (including transfer to an Account under Section 7.1, transfer to a Smart Wallet under Section 7.3(a), or explicit assignment of Owner Rights under Section 7.3(b)(ii)), and (c) any legal successor who would acquire a beneficial interest through the estate succession provisions of **Section 10.3**. The interests described in clauses (b) and (c) are recognized as contingent equitable interests in the Trust for trust-continuity purposes, determined by the objective transfer and succession mechanics of this Agreement rather than by the identity of any specific future holder. The inclusion of future and contingent interests in this definition does not confer any present right of action, possession, or control upon any person other than the present Beneficiary, except for the narrow procedural standing to petition for appointment of a Continuity Trustee under **Section 12.6** following a judicial determination of merger and the Beneficiary's failure to designate within the time period specified therein. This definition does not alter the tax treatment of the Trust under **Section 12.7**. ### 3. Establishing the Trust 1. The process for entering into this Agreement is as follows: 1. The Grantor, or a third party instructed by the Grantor, creates the Trust by generating a Token ID using the function `generateId` on the Token Contract; 2. the Grantor transfers the Property into the Trust by deed, or instructs a third party owner to do so, and records the deed with the relevant authority or recorder. The deed language shall specify both the Token Contract address and the Token ID; 3. the Grantor, or a third party instructed by the Grantor, Mints the Property Token through the Token Contract. This Agreement is attached to the Token Metadata via the `operatingAgreement` field. A copy of the conveyance deed may be attached to the Token Metadata to facilitate validation, but is not required for the Trust to be legally effective; 4. Upon a Confirmed Transaction, the Beneficiary will be entitled to the Owner Rights (described below). Ownership records for the Property Token will be kept by the Token Contract. 2. The Trust is not intended to be, shall not be deemed to be, and shall not be treated as a general partnership, limited partnership, joint venture, corporation or joint stock company. Prior to a Transfer, the trust should for all purposes be considered revocable by the Grantor, up to and until the specification of a Beneficiary. At the point a Beneficiary is specified, the trust is no longer revocable by the Grantor, and the Beneficiary then retains the sole right to distribute the Property and dissolve the Trust. 3. If the Property has been transferred into the Trust but the Property Token has not yet been minted and no Beneficiary has been specified, the Grantor shall be considered the Beneficiary of the Trust, unless otherwise specified. ### 4. Transactions and Interactions with Token Contract 1. To the maximum extent permitted by applicable law, any signature or execution made through the use of private keys on a Blockchain Network for any matters relating to the Property Token or the Trust shall be valid, sufficient, and final, as if signed in writing. 2. Any action that the Beneficiary or Trustee takes with respect to the Property or the Trust shall be invalid unless first instructed through a Confirmed Transaction on interaction with the Token Contract and under the conditions of this Agreement, except for (a) actions taken pursuant to an Alternative Dissolution Event under **Sections 10.2, 10.3, or 10.4**, and (b) ministerial preservation acts by a suspended Trustee and acts by a Continuity Trustee under **Section 12.6**, which are authorized by judicial determination and do not require a contemporaneous Confirmed Transaction. ### 5. Grantor rights and representations 1. The Grantor is responsible for funding of the Property into the Trust on creation. Following funding of the Trust, the Grantor (except in his capacity as Trustee and/or Beneficiary) will have no rights regarding the Property, the Property Token, or the management of the Trust, and will not retain any voting, director appointment, consent, approval, management, or revocation rights with respect to the Property or the Trust. Further, Grantor will not have any right to require the Beneficiary or Trustee to consult with Grantor with respect to the exercise of such rights and neither the Beneficiary nor the Trustee is required to consult with Grantor with respect to such rights, and the Grantor will have no right to remove or to replace the Beneficiary or Trustee. For purposes of this Agreement, the Trust is not deemed to be an affiliate of Grantor or of any of Grantor’s affiliates. 2. Immediately prior to Grantor’s conveyance of the Property into the Trust, Grantor represents and warrants: 1. That Grantor has the full right, power, and authority to enter into and deliver this Agreement and to perform all covenants and agreements of Grantor hereunder. 2. That to the best of Grantor’s knowledge at the time of creation of the Trust, Grantor owns fee simple record title to the Property as described in the Property legal description attached to the Token Metadata; or, if Grantor does not own fee simple record title to the Property, then Grantor has attached to the Token Metadata the full expression of Grantor's title interest in the Property being granted into the Trust, and a description of any other outstanding interests in the Property at the time of Trust creation. ### 6. Beneficiary Rights 1. The Beneficiary, or an authorized third party, is authorized: (1) to execute any function via the Token Contract regarding any decision made by the Beneficiary with respect to the Property Token, the Property, and the Trust, including but not limited to transfer, lease, encumbrance, fractionalization, or partial or total sale of the Property Token, transfer, lock, or utilization of the Property Token within any Contract Account, or any other legal and available activity with respect to ownership of property represented by a digital token; and, (2) to dissolve the Trust and instruct the Trustee to distribute the Property as more fully described in **Section 10**. The Beneficiary shall possess beneficial enjoyment of and from the Property, including the right of possession, right of control, right of exclusion, right of enjoyment, and right of disposition, as well as the right to transfer, lend or dispose of such, and any other rights traditionally or typically associated with property ownership, subject to the provisions of the Trust. The Beneficiary shall have the right to borrow against the Property Token. The Beneficiary is entitled to all net income and receipts from the Property regardless of source, and is responsible for any debts, taxes, or other liabilities arising out of the Property or ownership of the Property Token. All net income accrued or undistributed at the termination of any interest shall be treated as if it had accrued or been received immediately after that termination. All of the above Beneficiary rights and entitlements are referred to herein as the "**Owner Rights**." 2. The Owner Rights of the present Beneficiary shall be considered absolute, sole, and uncontrolled as to the exercise and enjoyment of those rights during the period of such Beneficiary's beneficial ownership, except to the extent that such Owner Rights are: (a) in conflict with other provisions of this Agreement, (b) temporarily affected by the transfer of Property Token custody to Contract Accounts as described in **Section 7.3**, or (c) subject to the contingent beneficial interests of determinable future Beneficiaries and legal successors as described in **Section 2.26**. For the avoidance of doubt, the characterization of the Owner Rights as "absolute, sole, and uncontrolled" describes the present Beneficiary's exercise of those rights and does not extinguish or merge the contingent equitable interests of other Beneficial Interest Holders. 3. If the Property Token is fractionalized such that multiple parties hold beneficial ownership, the governance of the fractional interests — including decision-making thresholds, deadlock resolution, and partition rights — shall be governed by a separate fractionalization agreement among the fractional owners. This Agreement applies to the fractional owners as a group (see **Section 2.3**), but does not prescribe the internal governance of that group. ### 7. Property Token Transfer 1. The Beneficiary may transfer the Owner Rights by transferring the Property Token to another Account or Contract Account. When transferring to an Account (EOA), the owner of that Account automatically becomes the new Beneficiary of the Trust. When transferring to a Contract Account, the determination of beneficial ownership depends on the nature of the Contract Account as defined in **Section 7.3**. Upon a valid transfer of beneficial ownership through a Confirmed Transaction, the new Beneficiary will either become the new trustee or appoint the new trustee. Unless the Beneficiary has appointed a different Trustee pursuant to a separate written instrument, the Beneficiary shall be deemed to be the Trustee. The Trustee's fiduciary duties under this Agreement run to all Beneficial Interest Holders; provided, however, that as to future and contingent Beneficial Interest Holders, such duties are limited to preserving the trust res and maintaining the integrity of the property-token relationship, and do not create any present right of action, direction, or control in any person other than the present Beneficiary (except for the narrow procedural standing described in **Sections 2.26 and 12.6**). The Trustee shall only serve as long as the Beneficiary is the Beneficiary of the Trust, and upon transfer of beneficial ownership, the prior trustee is replaced by the transferee trustee. 2. Transfer of the beneficial ownership of the Trust via valid transfer of the Property Token shall effectuate the full assignment of all interests, rights, duties, liabilities, and obligations under the Trust. Therefore, use of the terms "Trustee" and "Beneficiary" within this Agreement shall reference the present interest trustee and present interest beneficiary, as determined by the rules set forth in this Section 7. 3. The Beneficiary may transfer custody of the Property Token to a Contract Account, which may operate in one of two ways: a) As a **Smart Wallet**: a multi-signature wallet, account-abstraction wallet, or other custody solution directly controlled by specific individuals or entities. The transfer to a Smart Wallet operates as a transfer of beneficial ownership to the individual(s) or entity(ies) who control it, and they become the new Beneficiary(ies). b) As a **Functional Contract**: an escrow, bridge, lending protocol, collateral management system, fractionalization mechanism, or similar utility. The transfer of the Property Token to a Functional Contract does not automatically constitute a transfer of beneficial ownership. The original Beneficiary retains their Owner Rights and position as Beneficiary until either: (i) the Property Token is transferred to an Account or Smart Wallet, or (ii) the Beneficiary explicitly assigns their Owner Rights through a separate legal instrument. The distinction between custody and beneficial ownership ensures that temporary token operations through Functional Contracts do not unintentionally affect the underlying property rights, while preserving the flexibility to use smart contract infrastructure for property management and transfer. 4. All identifying information about the chain of Accounts and Contract Addresses that have interacted with the Property Token, as well as the present holding Address, are immutably recorded on the Blockchain Network(s) on which the Property Token is maintained. 5. Unauthorized transfers and security of access: 1. A Transfer resulting from unauthorized access to the Beneficiary's Account or Smart Wallet — including theft, compromise, or misappropriation of private keys or signing credentials — does not constitute a valid transfer of beneficial ownership under this Agreement. The prior Beneficiary retains their Owner Rights and their position as Beneficiary notwithstanding the onchain record of the Transfer. 2. The Beneficiary is responsible for maintaining the security of access to the Account or Smart Wallet holding the Property Token. 3. Nothing in this Section 7.5 limits or overrides the rights of a qualifying purchaser or protected secured party under **Section 11.4** who obtains control of the Property Token for value, in good faith, and without notice of the unauthorized Transfer. 4. If a claim under this Section 7.5 conflicts with a claim under **Section 11.4**, a court of competent jurisdiction as described in **Section 12.4** shall resolve the matter. ### 8. Trustee Obligations and Safe Harbor 1. The Trustee shall (the below Trustee rights and duties referred to herein as the "**Trustee Rights**"): 1. act as the representative of the Trust at the behest of the Beneficiary, and manage the Property of the Trust consistent with the terms of this Agreement for the benefit of all Beneficial Interest Holders; 2. prepare, execute, and deliver any documents related to the continued existence of the Trust as well as in connection with any transfer of the Property Token or any termination event as defined in **Section 10**; 3. have no duty or liability to the Grantor or Beneficiary with respect to any change in value of any of the Property during the life of the Trust, nor shall the Trustee be liable to any prior or subsequent beneficiary or trustee, except to the extent such liability is created by any private agreement or by the willful misconduct or gross negligence of the Trustee; and, 4. not be required to furnish a bond or other security in any jurisdiction for the faithful performance of its duties. 2. In connection with an Alternative Dissolution Event under **Sections 10.2, 10.3, or 10.4**, the Trustee may conclusively rely on the following documents without independent investigation, absent actual knowledge of fraud: (a) a recorded Notice of Lost Token Control; (b) the sworn certificate delivered under **Section 10.2.4**; (c) proof of legal succession recorded under **Section 10.3.2**; and (d) a certified copy of a court order issued under **Section 10.4**. The Trustee shall have no duty to independently verify the state of the Blockchain Network, interpret Smart Contract code, or determine whether a Contract Account is a Smart Wallet or a Functional Contract. ### 9. No individual ownership; Trust Proceeds 1. Title to all of the assets of the Trust shall be vested in the Trust until the Trust dissolves; provided, however, that if the applicable laws of any jurisdiction require that title to any part of the assets of the Trust be vested in a party to the Trust, then title to that part of the assets of the Trust shall be vested in the Beneficiary to the extent so required, with such vested title remaining subject, however, to the assignment and transfer provisions of **Section 7**. Ownership of the Property will remain in the Trust despite the transfer of the Property Token until such time as the Trust is dissolved. ### 10. Trust termination 1. The process for dissolving the Trust is as follows ("**Dissolution Event**"): 1. first, the Beneficiary will burn the Property Token by executing the `burn` or `burnBatch` functions on the Token Contract; 2. second, after a Confirmed Transaction evidencing the burn, the Trustee will execute and deliver a deed in recordable form (including notarization as required by applicable law); the deed should include a statement cryptographically signed by the last controller of the Property Token, authorizing the specific transfer; and, 3. the Trustee will transfer the Property out of the Trust. 2. If the Beneficiary is unable to Redeem the Property Token due to loss of access to the private key(s) or signing credentials controlling the Account or Smart Wallet, the Trust may be dissolved through an Alternative Dissolution Event. This Section applies only when the Property Token is held by an Account or Smart Wallet at the time the Notice of Lost Token Control is recorded. If the Property Token is held by a Functional Contract, the Beneficiary must first cause it to be returned to an Account or Smart Wallet. If the relevant county recorder or equivalent recording authority refuses to accept the Notice of Lost Token Control for recording, the Beneficiary shall proceed under **Section 10.4**. The process is as follows: 1. The Beneficiary shall record a Notice of Lost Token Control with the relevant county recorder or equivalent recording authority in the jurisdiction where the Property is located. Within ten (10) calendar days of recording, the Beneficiary shall deliver a copy of the recorded Notice by certified mail, return receipt requested, to: (a) the Property address as shown in the records of the county assessor or tax collector; and (b) each person who appears in the official records of the county recorder as the holder of a recorded lien, deed of trust, mortgage, or other encumbrance against the Property, at the address shown in the recorded instrument or, if more current contact information is reasonably available to the Beneficiary, at such current address. For purposes of this clause (b), the Beneficiary's obligation extends to instruments appearing in a search of the grantor-grantee index (or equivalent official index) maintained by the county recorder; the Beneficiary is not required to obtain a full title search or title report. Failure to notify a party whose interest does not appear in such official records does not invalidate the Notice or the Quiet Period. The Quiet Period shall commence on the date of recording. 2. The Notice of Lost Token Control, once recorded, constitutes constructive notice under applicable recording statutes of the Beneficiary's claim. Any party with an interest in the Property Token or the Property may contest the Notice or assert a competing claim during the Quiet Period by recording with the same county recorder any instrument permitted by applicable law that gives constructive notice of the contest, including but not limited to a lis pendens, a notice of pending action, an affidavit of adverse claim, or any equivalent instrument recognized by the recording statutes of the jurisdiction where the Property is located. A Notice of Lost Token Control recorded by a different claimant with respect to the same Property Token also constitutes a contest. To be effective under this Section, a contest must appear in the county records before expiration of the Quiet Period; the filing of legal proceedings alone, without a corresponding recorded instrument, does not constitute a contest for purposes of this Section. If a contest is recorded during the Quiet Period, the process under this **Section 10.2** shall immediately halt and the matter shall be resolved under **Section 10.4**. 3. If a Confirmed Transaction is initiated by the Account or Smart Wallet holding the Property Token during the Quiet Period, the process under this **Section 10.2** shall immediately halt. For purposes of this Section: - A Confirmed Transaction includes any transaction signed by or originating from the Account or Smart Wallet holding the Property Token, not solely a Transfer of the Property Token. - Where the Property Token is held by a Smart Wallet, a transaction "originating from" the Smart Wallet means a Confirmed Transaction in which the Smart Wallet successfully executes an outbound action on the Blockchain Network. A transaction sent *to* the Smart Wallet by an external party — including calls that revert or that do not result in a successful outbound action by the Smart Wallet — does not constitute a transaction "originating from" the Smart Wallet for purposes of this Section. If the claimant has recovered access to their private key, no further action is required. If the transaction was initiated by any other party, or if its origin is disputed, the matter shall be resolved under **Section 10.4**. 4. Upon expiration of the Quiet Period, the Beneficiary (or the legal successor acting under **Section 10.3**) shall deliver to the Trustee a sworn certificate, dated after the expiration of the Quiet Period, stating that: - (a) after review of publicly available Blockchain Network records, no Confirmed Transaction was initiated by the Account or Smart Wallet holding the Property Token during the Quiet Period; - (b) no contest as described in **Section 10.2.2** was recorded with the relevant county recorder during the Quiet Period; and - (c) the Beneficiary complied with the notice-delivery requirements of **Section 10.2.1**, including delivery to the Property address under clause (a) and to each party identified under clause (b), or that no parties were identified under clause (b) after a search of the official records described therein. The Trustee may conclusively rely on this certificate pursuant to **Section 8.2**. 5. Upon receipt of the sworn certificate described in **Section 10.2.4**, the Trustee shall, at the direction of the Beneficiary, execute and deliver a Deed of Distribution transferring the Property out of the Trust. The Deed of Distribution shall be in recordable form and shall recite: - (a) the alternative dissolution provision under this **Section 10.2**; - (b) the recording information of the Notice of Lost Token Control; - (c) that the Quiet Period expired without any Confirmed Transaction initiated by the Account or Smart Wallet holding the Property Token and without any recorded contest as described in **Section 10.2.2**, based on the Beneficiary's sworn certificate; and - (d) that the condition precedent in **Section 1.2(a)** and the cryptographic signature requirement in **Section 10.1.2** do not apply to this Alternative Dissolution Event, the Notice of Lost Token Control and the expiration of the Quiet Period without contest serving as substitutes for those requirements. 6. Upon recording of the Deed of Distribution, the Property Token shall become a Void Token. 3. If the Beneficiary has died and neither the Beneficiary's estate nor successors have access to the private key(s) or signing credentials controlling the Account or Smart Wallet, the Trust may be dissolved through an Alternative Dissolution Event following the process in **Section 10.2**, with the following modifications: 1. The claimant shall be the Beneficiary's legal successor, which may include an executor, administrator, or heir as determined by applicable law. 2. The Notice of Lost Token Control shall be accompanied by proof of legal succession that is valid and sufficient under the laws of the jurisdiction where the Property is located. Acceptable instruments include letters testamentary, letters of administration, a small estate affidavit, or an equivalent instrument recognized by the probate or succession laws of that jurisdiction. Such proof shall be recorded together with or as an exhibit to the Notice. If the legal successor is unable to obtain proof of succession that satisfies the requirements of the jurisdiction where the Property is located, the dissolution shall proceed under **Section 10.4**. 3. Upon expiration of the Quiet Period without any Confirmed Transaction initiated by the Account or Smart Wallet holding the Property Token and without any contest as described in **Section 10.2.2**, the legal successor shall step into the position of the Beneficiary for the purpose of directing the Trustee to execute and deliver the Deed of Distribution and completing the dissolution of the Trust. 4. For the avoidance of doubt, if the Beneficiary's successors have inherited access to the private key(s) or signing credentials controlling the Account or Smart Wallet holding the Property Token, no Alternative Dissolution Event is required. The successors may exercise the Owner Rights directly, including dissolving the Trust under **Section 10.1**. 4. If the Trust cannot be dissolved under **Sections 10.1, 10.2, or 10.3** — including situations where the Property Token has been stolen, where a Transfer occurs during the Quiet Period, where competing claims to beneficial ownership exist, or where any other contested circumstance prevents completion of those processes — a court of competent jurisdiction as described in **Section 12.4**, or a court of competent jurisdiction where the Property is located, may order the dissolution. The court order substitutes for both the condition precedent in **Section 1.2(a)** and the cryptographic signature requirement in **Section 10.1.2**. The Deed of Distribution shall be accompanied by a certified copy of the court order. 5. The following provisions apply to all Alternative Dissolution Events under **Sections 10.2, 10.3, and 10.4**: 1. Upon recording of the Deed of Distribution pursuant to any Alternative Dissolution Event, the Property Token shall become a Void Token. Any subsequent holder of a Void Token acquires no beneficial ownership of the Property or the Trust, regardless of whether such holder has "control" of the Void Token within the meaning of **Section 11.1** or UCC Article 12. 2. The legal validity of an Alternative Dissolution Event is established by the recorded Deed of Distribution. Any offchain records (including confidence scores, platform databases, or similar systems) may be updated to reflect the void status of the Property Token, but the absence of such updates does not affect the legal status of the Void Token or the validity of the dissolution. 3. The alternative dissolution provisions of this Agreement do not limit or affect any party's rights under applicable law, including the right to seek injunctive or other equitable relief. 4. For purposes of UCC Article 12 as described in **Section 11**, a Void Token may continue to exist as a controllable electronic record on the Blockchain Network, but the property rights it previously represented have been extinguished by the Deed of Distribution. No person may rely on "control" of a Void Token as a basis for claiming any interest in the Property. 6. In the event of any disposition involving all or part of the Property, the proceeds of such distribution, whether in the form of cash, property, digital assets, or other assets or securities, will be distributed to the Beneficiary, or any other person or entity designated by the Beneficiary to receive such distribution. In the event that dividends or distributions are paid in respect of any portion of the Trust Property, all of such dividends or distributions shall be distributed to the Beneficiary as soon as practicable following receipt of any such dividends or distributions, whether in the form of cash, property or securities. 7. Once the Trust has been fully established, as per the steps in **Section 3**, and throughout the life of the Trust, the Grantor holds no right of termination, nor is any termination subject to the life of Grantor or any decision or action taken by the Grantor. ### 11. Uniform Commercial Code Treatment 1. Except as provided in Section 11.3, the Property Token constitutes a "controllable electronic record" as defined under Article 12 of the Uniform Commercial Code as adopted in California and, to the extent adopted, any other applicable jurisdiction ("**UCC Article 12**"). A person has "control" of the Property Token when the requirements of UCC Article 12 are satisfied, which the parties intend may be achieved through blockchain-native mechanisms such as cryptographic keys and smart contract systems. For clarity, UCC Article 12 "control" generally requires the power to enjoy substantially all benefits of the record, the exclusive power to prevent others from doing so and to transfer control, and a means to readily identify the person in control. 2. When the Property Token is deposited into a smart contract for collateralization, lending, escrow, pooling, or similar arrangements, such smart contract may serve as a method of obtaining and evidencing "control" for purposes of UCC Article 12; programmed restrictions or automated processes within such smart contract do not, by themselves, defeat control. The standards and procedures for enforcement and disposition specified in the smart contract are agreed standards for purposes of UCC § 9-603, intended not to be manifestly unreasonable. Nothing in this Agreement waives any rights or duties that cannot be waived under UCC § 9-602, nor does it constitute post-default consent to acceptance of collateral in satisfaction of an obligation under UCC § 9-620. 3. If the Property Token is credited to a securities account and held through a securities intermediary that has expressly agreed to treat the Property Token as a "financial asset" under Article 8 of the Uniform Commercial Code ("**UCC Article 8**"), such holding arrangement shall be governed by UCC Article 8, and the Property Token shall not be treated as a controllable electronic record under Section 11.1 for the duration of such arrangement. 4. Transfers of the Property Token are intended to enable transferees who obtain control for value, in good faith, and without notice of any competing property claim to qualify as "qualifying purchasers" under UCC Article 12 and thereby take free of adverse claims to the extent provided by applicable law. A party who obtains a security interest in the Property Token for value, in good faith, and without notice of any unauthorized Transfer or competing claim (a "**protected secured party**") shall receive the same protection under this Agreement as a qualifying purchaser to the extent permitted by applicable law. In such case, the prior Beneficiary's remedy is against the party who effected the unauthorized Transfer, not against the protected secured party. 5. For the avoidance of doubt, the UCC characterizations in this Section 11 have no bearing on whether the Property Token is a security as used in any other context or regulation, nor do they constitute an admission that the Property Token is a security for any purposes other than the Uniform Commercial Code. It is the intent of the parties that the Property Token shall not be a security for purposes of US federal securities law (including the Securities Act of 1933 and Securities Exchange Act of 1934), California securities laws, or any other applicable state, local, or foreign securities laws. 6. **Real-Property Law Preservation.** Nothing in this Section 11 displaces, modifies, or supersedes the real-property recording statutes, deed requirements, title-vesting rules, or real-property perfection and priority rules of the jurisdiction where the Property is located. "Control" of the Property Token within the meaning of UCC Article 12 determines rights in the Property Token as a controllable electronic record, but does not by itself transfer, encumber, or create any interest in record title to the Property. Transfer of record title to the Property requires a deed or other instrument that satisfies the recording and conveyancing requirements of applicable real-property law, executed and delivered in accordance with this Agreement. ### 12. Miscellaneous 1. If any part of any provision of this Agreement or any other agreement, document, or writing given pursuant to or in connection with this Agreement shall be invalid or unenforceable under applicable law, said part shall be ineffective to the extent of such invalidity only, without in any way affecting the remaining part of said provision or the remaining provisions of this Agreement. 2. The headings of the sections and subsections of this Agreement are inserted for convenience of reference only and do not form a part or affect the meaning hereof. Wherever used herein, a pronoun in any gender shall be considered as including any other gender pronoun. References to the singular include the plural, and vice versa. 3. To the extent it is not contrary to a strong public policy of the jurisdiction, if any, having a more significant relationship to this Agreement, this Agreement, the rights and obligations of the parties hereto, and any claims and disputes relating thereto, shall be governed by and construed in accordance with the laws of the State of California (not including the choice of law rules thereof). Notwithstanding the foregoing, matters relating to the conveyancing, recording, and transfer of record title to the Property, the validity and priority of liens and encumbrances on the Property, and probate or succession proceedings affecting the Property, shall be governed by the mandatory laws of the jurisdiction where the Property is located to the extent such laws cannot be varied by agreement. 4. The parties to this Agreement hereby consent to the non-exclusive jurisdiction of any State or Federal Court of competent jurisdiction located within the State of California, in the County of San Francisco, in connection with any actions or proceedings arising directly or indirectly from this Agreement. Notwithstanding the foregoing, actions to quiet title, foreclose liens, or otherwise adjudicate interests in the Property may be brought in any court of competent jurisdiction where the Property is located, and this Agreement does not waive or limit such jurisdiction. 5. **No Merger of Interests.** The Trust created by this Agreement shall not fail or terminate by reason of the merger of legal and equitable interests. The parties acknowledge that, because the Property Token is transferable and beneficial ownership passes with valid Transfers under **Section 7**, the equitable interests in the Trust are at all times held by the class of Beneficial Interest Holders (including determinable future Beneficiaries and legal successors under **Section 10.3**), and are not held solely by the present Beneficiary even when the present Beneficiary also serves as Trustee. If any court of competent jurisdiction determines that any provision of this Agreement would otherwise cause a merger of legal and equitable title, such provision shall be automatically construed and, if necessary, reformed to the minimum extent required to preserve the separation of legal and equitable interests and the continuity of the Trust, consistent with the Trust Purpose stated in **Section 1**. 6. **Springing Trustee for Continuity.** If, notwithstanding **Section 12.5**, a court of competent jurisdiction determines that a merger of legal and equitable interests has occurred or is imminent, the Trust shall not terminate. Instead, the present Beneficiary's role as Trustee shall immediately and automatically be suspended. Pending qualification of the Continuity Trustee described below, the suspended Trustee shall retain only ministerial authority to preserve the trust res and prevent waste; the suspended Trustee shall have no authority to make distributions, encumber the Property, or take any action beyond those strictly necessary to maintain the status quo. A temporary special trustee (the "**Continuity Trustee**") shall then serve solely to preserve the trust res and complete any recordable acts necessary to maintain the property-token relationship. The Continuity Trustee shall be selected by the Beneficiary; if the Beneficiary fails to designate a Continuity Trustee within thirty (30) calendar days of the court's determination, any Beneficial Interest Holder may petition the court described in **Section 12.4** to appoint one. The Continuity Trustee shall have no discretion over distributions, no authority to direct or encumber the Property, and no powers beyond those strictly necessary to maintain the Trust's existence and execute documents at the Beneficiary's direction. The Continuity Trustee's appointment terminates automatically upon the earliest of: (a) a valid Transfer of the Property Token to a new Beneficiary, (b) the Beneficiary's appointment of a different Trustee under a separate written instrument, or (c) dissolution of the Trust under **Section 10**. Nothing in this Section creates a standing professional trustee requirement, imposes ongoing fees, or grants any platform, company, or third party approval rights over Trust operations. 7. **Tax Treatment.** The present Beneficiary shall at all times be treated as the owner of the Property for all federal, state, and local tax purposes. The existence of contingent interests held by future Beneficial Interest Holders under **Section 2.26** does not create a separate taxable interest, does not entitle any future Beneficial Interest Holder to current income or deductions, and does not alter the pass-through treatment of the Trust.