3.3 IBO (Initial Brick Offering)

Brick issuance fee is calculated as insurance cost and issuance cost according to the value of the underlying asset and the number of leveraged bricks issued. The brick issuance fee is paid by deducting IBO revenue.

Procedures and Conditions for IBOs

The Brick Exchange (XBRIK) shall post on the IBO bulletin board of the exchange within seven days (at least three days) of the IBO after reviewing, approving, and signing the contract for the application for issuance of bricks. To participate in the IBOs, investors must register as an XBRIK members and open their wallets. The significant conditions for IBO application are as follows:

• Quantity designation method: positive integer

• Application limit: less than 1% of the total IBO amount

• Deposit: Instant deposit in full, ETH

• Application period: 3 days from the start date of application (in principle, first-come-first-served basis, application of the lottery method is also under consideration)

• Cancellation of application: possible within the application period

• Brick allocation: 100% allocation for the application quantity. If the number of applications exceeds the number of IBO bricks, the last applicant's allocation may be adjusted.

• Final listing conditions: When the IBO sales amount is equal to or greater than the underlying asset value (before applying leverage. However, if less than 100% leverage is applied, the final listing is possible if the amount is greater than or equal to the applicable leveraged value)

• Handling of remaining IBO bricks: Bricks that meet the final listing conditions but are not sold are deposited with XBRIK and managed by XBRIK. XBRIK may allocate the remaining IBO bricks before final listing at its discretion.

IBO Failure

If the IBO sale amount is less than the underlying asset value or the 100% leveraged value, the final listing and quotation transaction will not proceed. All IBO-related transactions will be canceled, and the deposited IBO funds will be returned within five days after the public offering period.

IBO Success

When the IBO meets the final listing conditions, an order book for quotation trading is created, and bricks are allocated to IBO investors. After that, trading of bricks is possible until the expiration date.