Law No. 2 “On Bankruptcy»

Ed. 1 of January 1, 0000

General provisions

1. The bankruptcy procedure (recognition of insolvency) can be applied in the game with respect to both legal entities (companies of any form of ownership and individual enterprises) and individuals (player characters and computer-controlled characters).

2. A person may be recognized as insolvent (bankrupt) on the basis of formal signs of insolvency in accordance with this Law, as well as by decision of the administration of the game or other bodies created in the game and authorized to do so by relevant acts, in respect of which the bankruptcy procedure is applied, unable to fulfill its unconditional obligations in full. Bankruptcy proceedings may be initiated by a creditor of a person or a group of creditors upon application to the game administration or authorized bodies.

3. A bankruptcy procedure may be accompanied by a restriction of the person to whom it is applied, in the property rights and disposition of own property and the procedure of external management in order to meet the requirements of the creditors of the person.

Bankruptcy procedure, external management

4. A person is considered insolvent and is declared bankrupt automatically if its amount of liabilities (debts) exceeds 70% of the value of its assets, or the amount of overdue debt (with a maturity of more than 180 days) exceeds 20% of the value of its assets. For such a person, a bankruptcy procedure is introduced. The procedure is carried out either at the time of processing the game data, or when an instant change in the value of assets or liabilities.

5. The recognition of a person as bankrupt initiates an external management procedure. The owners or management bodies of a legal entity (or a bankrupt individual) lose their ability to dispose of the bankrupt’s property, as well as to exercise operational management, including all objects belonging to the bankrupt (enterprises of the company) until the external management procedure is completed.

6. If it is impossible to implement automated external management, the administration of the game may appoint an external administrator from among persons not affiliated with the bankrupt and not having a conflict of interests. The procedure for electing an external manager can be carried out with the involvement of the public of the game.

7. The purpose of the external management is to sell the assets of the bankrupt in order to meet the requirements of creditors. In the process of external management, bankrupt assets are put up for sale at prices determined by the external manager (in case of appointment), or automatically by the game system. Bankruptcy owners are not entitled to dispute the prices that are set on the property being sold, or the procedure for selling the property.

8. Enterprises that do not have assets that are valuable for sale, but that continue to incur expenses that increase bankruptcy liabilities, can be closed (liquidated) without the sale procedure.

9. The funds received from the sale of the bankrupt’s assets are used to repay its liabilities (debts).

Completion of the external management procedure

10. The external management procedure is terminated if the value of the unliquidated obligations is less than 50% of the value of the remaining assets of the bankrupt, and all overdue debts are repaid (with a maturity of more than 180 days). The procedure stops automatically after the next recalculation of the value of assets at the end of the game week. In emergency cases, external management may be canceled by the intervention of the administration at the request of the owners of the bankrupt.

11. If, in the process of external management, the bankrupt’s assets fail to repay all its liabilities, a bankrupt legal entity may be liquidated and the remaining liabilities derecognised. An individual, in case of failure to fulfill obligations, can be carried out through the restart procedure.

12. Bankruptcy owners or other interested persons may deposit their own funds into bankruptcy accounts in order to repay obligations and terminate the external management procedure in accordance with clause 10.

13. Creditors of a bankrupt are entitled to withdraw their claims in full or in part, or to transfer the right of claim to other persons; mutual obligations of two persons are repaid in the amount of the smallest obligations.

Dispute Resolution

14. Disputes and claims arising in the course of bankruptcy procedure are resolved in the prescribed manner with the involvement of the administration of the game, as well as the relevant authorities and public associations.