WSE Market Rules

WSE Market Rules

Date of Last Revision: Thursday 31st July 2008, 31/07/2008

Welcome to the World Stock Exchange, a fictional securities exchange and banking role playing game. The WSE provides participants with a simulated securities exchange, trading and banking environment for educational and entertainment purposes.

In addition to the WSE Terms of Service, participation in the World Stock Exchange service is governed by the Market Rules and Listing Rules (collectively “Game Rules”). Please read this section to ensure you fully understand how the game is operated in order to provide all participants with the most entertaining and educational simulated securities exchange, trading and banking environment. The WSE is designed to simulate the actions, situations, events, trends and experiences found in real life markets.

Definitions:

Stock Exchange	Stock Exchange, also referred to as Stock Market, Share Market, Bourse or Securities Exchange is an organisation, association or group that constitutes, maintains, or provides a marketplace (market) or facilities for bringing together buyers and sellers of securities. The World Stock Exchange (WSE) is an emerging technology platform and service providing a simulated stock exchange environment with each market participant playing a specific role within the role-playing game.
WSE 4.0	WSE 4.0 is the upgraded version and latest software release of the emerging WSE platform. The WSE platform is currently in the Gamma (Release Candidate) development phase for the purpose of final testing during the month of August 2008. Following the Gamma phase WSE will enter into a rolling release phase representing the continuously evolving WSE platform.
Market	A market is a venue where buyers and sellers exchange the rights (ownership) of services and goods. On the WSE, market refers to the World Stock Exchange marketplace and all of its Participants. The WSE provides a fictional marketplace allowing it to create a simulated environment.
Fictional Services	Fictional services (Fictional) on the WSE are a creation in a simulated environment for game purposes only and are without basis in reality and hold no legal monetary, barter or asset value.
Participant	A Market Participant is a user participating in the simulated market provided by WSE. Users participate in the market as a Trader, Analyst, Company Officer or CEO. By default all user accounts are set to Trader status when they are first created.
Shares	Shares also referred to as Stocks are a type of security that represents a unit of ownership in a company or financial asset such as a mutual fund. Shares represent a claim on a portion of the assets and earnings of the company. The owner of shares are referred to as Shareholders or Stockholders. The term Shares on the WSE refers to shares in a WSE listed company that are purchased and sold (traded) on the WSE using the World Internet Currency. Shares on the WSE are fictional, not real and are for game purposes only.
Bonds	A bond is a type of interest-bearing security issued by a corporation, governmental agency, or municipality (Bond Issuer) to borrow funds from the lender (Bondholder) in order to raise capital. The bond issuer agrees to pay the bondholder either a fixed or variable rate of interest for the life of the bond until it reaches the maturity date. At maturity, the bondholder will be repaid the original funds lent (principal amount). The term Bonds on the WSE refers to Bonds issued by a company listed on the WSE are purchased and sold (traded) on the WSE using the World Internet Currency. Bonds on the WSE are fictional, not real and are for game purposes only.
Securities	A security is a unit of trade with specific terms and rights like a contract traditionally in the form of a certificate that can be assigned a value and traded. Examples of securities include notes, shares, bonds, debentures, options, futures, rights, warrants, or almost any other financial asset exchangeable under terms. Securities issued by listed company on the WSE are purchased and sold (traded) on the WSE Marketplace using the World Internet Currency. Securities on the WSE are fictional, not real and are for game purposes only.
Account Balance	All WSE user accounts have an account balance which displays the total amount of World Internet Currency assigned to each user account. The WSE does not use real currency and the account balance is for game purposes only.
Portfolio	A Portfolio is a collection of investments held by an institution or a private individual. An investment portfolio consists of an investor who owns shares or stocks in multiple companies of different sectors (industries) e.g. shares owned in a casino business and a clothing business. Holding a portfolio is part of an investment and risk-limiting strategy called diversification. By owning several assets, certain types of risk (in particular specific risk) can be reduced. A Portfolio on the WSE contains a collection of securities assigned to a Participants Account. All securities assigned to a Participants account are for game purposes only.
Trader Ranking	The WSE Trader Ranking is a feature that displays a Ranking of Traders by Net Worth.
Top Performers	The WSE Top Performer feature that displays a Ranking of Traders by the total Portfolio Gain/Loss since the account was first created.
Interest	Interest is money paid for the use of money, expressed as a percentage rate for the period of time in use and is usually expressed as an Annual Percentage Rate, APR. An Interest rate is expressed as an annual rate if the rate is followed by p.a. an abbreviation for Per Annum (Yearly/Annually) e.g. 9.95%p.a. Bank interest is paid to attract deposits from customers (depositors) and to compensate depositors for allowing the bank to invest the deposited funds in order to generate a profit. The World Stock Exchange service provides a feature called the World Internet Bank that allows users to receive interest on the World Internet Currency assigned to their account balance. Interest paid on a users account balance is not real or legally recognised and is only providing users with a simulated banking environment on the WSE service and is for game purposes only.
Brokerage	A fee or commission paid by the client to a broker for facilitating and executing orders on behalf of the client. Brokerage,Trading Fee, Commission (collectively “Brokerage”) on the WSE is a trading fee charged as a 3% commission on the sale of all securities by a Trader on the WSE. The fee is deducted from the World Internet Currency assigned to the Participants WSE account balance and is for game purposes only.
Investment	An investment is the purchase of an asset such as a business, real estate, cash, commodities or securities with the expectation that the asset will provide income in the future and/or increase (appreciate) in value to be sold at a higher price at a later date. The fundamental concept of investment sourced from the ancients is when money earned is invested but not spent so that it may grow until the money earned comes from the money invested. Participants in the WSE apply the above methods in an attempt to learn the art of wealth creation through the application of investing World Internet Currency on the WSE through a combination of purchasing securities, earning interest and dividends or to ultimately increase the amount of World Internet Currency assigned to their account. An Investment in the WSE is using fictional currency and is not a real or legally recognised investment or investment opportunity and is for game purposes only.
Holdings	Holdings are all the securities purchased and held by a Participant and assigned to their WSE account.
Company	Company, Corporation or Corporate entity is an organisation and separate legal entity usually established to undertake commercial business activities for profit. A company is owned and controlled by its shareholders who elect the board of directors to act as representatives of the shareholders and to establish a mission, strategies, policies or to make key decisions related to the company such as appointing the senior management team. A Company on the WSE (Company, Business, WSE Listed Company) is a group account solely for use on the WSE and managed by a Participant playing the role of CEO in the WSE role-playing game. A company on the WSE is not a real or legally registered entity or business. The Participant may participate in the WSE service on behalf of a real and legally registered entity or business provided the Participant has sought and received written, signed consent from the business proprietor or director's along with additional approvals for items such as IP rights. All information submitted by the Participant acting as CEO is for game purposes only and may not be reliable, true, accurate or credible and is subject to the WSE Terms of Service.
Company Administration	Company Administration is a facility for the CEO of a WSE Listed Company to manage and update company information. The facility allows a CEO to post announcements, financial reports, events or resolutions. Add/Remove Company Officers and their ability to make insider trades and to update the Company Profile/Prospectus.
Constitution	A Constitution also known as Charter, Memorandum of Association, Articles of Incorporation or Articles of Association is a set of documents that define the existence of an entity and regulate the structure and control of that entity and the rights and obligations of its members. A company listed on the WSE is regulated and controlled by the WSE Market Rules which include within those rules many similar rights and obligations that would be contained in the Constitution of a real life corporation. The WSE only provides the Market Rules as a means to guide and govern the actions of market participants. The rights of all participants within the WSE Market Rules are not real or legally recognised and only form part of the game and simulated environment provided by the WSE. The obligations of all participants by the WSE must be adhered to according to the WSE Terms of Service.
CEO	The Chief Executive Officer, CEO, President or Managing Director is the most senior role in an organisation. The CEO is responsible for carrying out and executing the strategy and policies of the board of directors. The CEO reports directly to the Board of Directors. The CEO is responsible for leadership, appointing senior staff, reporting to shareholders and the board, delegating, executing strategy, driving growth and overseeing the day to day operations of the organisation. A CEO on the WSE is a Participant who has submitted a pending IPO application, approved and listed IPO or a Listed Company on the WSE. The CEO on WSE may or may not be CEO of the real, internet or virtual business they are representing. A CEO on the WSE is a Participant on the WSE who has chosen the role of a CEO in the game. The CEO on the WSE is responsible for submitting an IPO application and the information contained within it such as the Prospectus, Securities to be Issued and offer price. Once the IPO is moved to the Official List and becomes a WSE listed Company the CEO is responsible for liaising with the WSE and shareholders, posting the announcements, financial and operational reports, respond to analyst reports, operate groups, resolutions and optionally post web-based video reports, conference calls or meetings within virtual worlds such as Second Life. A WSE approved CEO is for game purposes only.
Officeholder	An officeholder on the WSE is a Participant acting as a company officer as part of their role in the game. The Participant is appointed or elected as an officer of the company to act in an advisory and management role. Company officers include the board of directors, secretary, general council and executive management roles. The Company Officer on the WSE may or may not be Company Officer of the real, internet or virtual business they are representing and may have their real name or virtual world name listed in the a company profile or prospectus. The CEO of a WSE listed company must have permission from the Company Officer to list their identity on the WSE. The role of Company Offer on the WSE is for game purposes only.
Employee	An employee of a WSE listed company may or may not be a Participant in the WSE and may have their real name or virtual world name listed in the a company profile or prospectus. The CEO of a WSE listed company must have permission from the employee to list their identity on the WSE. An employee on the WSE is for game purposes only.
Analyst	An analyst studies public companies listed on a stock market and provides clients with buy or sell recommendations on the securities of particular companies. Analysts work in brokerage houses, investment banks, or fund management companies. A WSE approved analyst is a Participant on the WSE who has applied for and been approved for the role of Analyst on the WSE. A WSE approved Analyst does not provide real investment or financial advice and is for game purposes only.
Trader	A Trader is an individual who trades securities on the financial markets, either for themselves, or on behalf of another individual or organisation in an attempt to make a profit. A Trader (Shareholder, Investor, Trader) on the WSE is a Participant who has chosen the role of an Investor, Shareholder and Trader in the game to learn and have fun through trading securities, earning interest and dividends and to ultimately increase the amount of World Internet Currency assigned to their account. A Traders main role on the WSE is placing and executing orders to buy or sell securities in Companies listed on the WSE. A Trader does not make real investments and is for game purposes only.
Customer	A Customer (Buyer) receives a product or service from an individual or organization in exchange for an immediate or agreed future payment to the individual or organization by the Customer. Any references to Customers on the WSE are in relation to the buyers of a product or service supplied by the non WSE related operations of a listed company on the WSE. The CEO of a company on the WSE may refer to a customer as part of their role in the game.
Supplier	A Supplier (Creditor, Vendor) is a business which supplies a product or service to another business within the supply chain made up of organizations, people, technology, activities, information and resources involved in completing and moving a product or service from the supplier to customer. Any references to Suppliers on the WSE are in relation to the suppliers of a product or service supplied to the non WSE related operations a listed company on the WSE. The CEO of a company on the WSE may refer to a supplier as part of their role in the game.
Stakeholder	A Stakeholder in a company is an individual, group or organisation who affects, or can be affected by, the actions of a Company. Stakeholders include Employees, Shareholders, Investors, Suppliers, Customers, Markets and may include Communities and the Government. On the WSE Stakeholder refers to the Participants and Marketplace on the WSE and is for game purposes only.
Bond Rating	A grade given to bonds that indicates their credit quality. Independent rating services such as Standard & Poor's provide evaluations of a bond issuer's financial strength, or its the ability to pay a bond's principal and interest in a reasonable time frame. The Bond Rating on WSE is a feature that allows analysts to review the performance of a bond along with the ability to assign a rating to the bonds and is based on the Standard & Poor's format. Bond ratings on the WSE are for game purposes only.
Market Rating	The WSE Market Rating feature provides each Participant with an opportunity to rate each company and pending IPO application listed on the WSE. Our 5 star market rating system provides all stakeholders with an ability to measure market interest in a particular company. Users are allowed 1 vote per company. The best possible rating is 5 stars.
Announcement	The WSE platform provides a facility for announcements related to the latest news and operational information related to the Market and WSE Listed Companies. Official Announcements are posted by the WSE and are displayed on the front page and in the Portfolio News section. Company Announcements are posted by the CEO of a WSE Listed Company.
New Offers	A New Offer on the WSE is the first sale of securities by a Company listed on the WSE. New offers on the WSE are for game purposes only and allow the Participant in the role of CEO to raise World Internet Currency from other Participants.
Prospectus	A prospectus is an offer document that institutions and businesses use to describe the securities they are offering to participants and buyers. The prospectus contains information about the business including its mission, strategy, products and services, financial statements and biographies of the officers and directors. A prospectus on the WSE is not a legal offer document and is a feature of our service. No prospectus by a participant or on the WSE is legally approved or recognized investment or investment opportunity and is only for educational and entertainment purposes.
IPO	An IPO (Initial Public Offering) is the first sale of shares by a private company to the public and institutional investors which results in making the company a public company. An IPO on the WSE is for game purposes only and to allow the Participant in the role of CEO to raise World Internet Currency from other Participants.
Secondary Offer	A company that has previously held an IPO or Bond Issue may decide to hold a New Issue (Secondary Offer) to issue new securities for public sale in order to refinance, or raise additional capital for growth. This process is known to increase the companies liabilities, interest commitments or dilute the shares and equity owned in that company by existing shareholders and as a result it is common for existing shareholders to be the first subscribers to such an offering. In the long term it is intended that overall share value will increase along with capital growth as a result of a Secondary Offer. A Secondary Offer on the WSE is for game purposes only and to allow the Participant in the role of CEO to raise World Internet Currency from other Participants.
Share Classes	A company on the WSE can issues shares in classes to assign different rights to the holders of those shares such as shares with no voting rights or shares with a priority on dividends.
Securities Issued	Total Securities Issued is the total Shares Outstanding (Shares Issued) including restricted shares owned by company officers or the total Bonds Issued by a Bond issuer.
Issue Price	Issue Price is the Price per Security at which the securities are being offered. The Issue price for shares in an Initial Public Offering (IPO) is called the Initial Offer Price. All prices on the WSE are based on and quoted in World Internet Currency.
Issue Remaining	Total number of securities in an offer not yet sold that remain available for purchase.
Closing Date	The Closing Date is the date at which the IPO or Secondary offer will close.
Rollback	A rollback reverses an individual transaction or multiple transactions out of the database, returning the data to its original or former state.
Undersubscribed	An offer is Undersubscribed is when the demand for securities in the offer is less than the number of securities issued or when the sale of securities is less than the total securities for sale. If the shares in an IPO on the WSE were not completely sold the IPO is Under Subscribed and a decision will be made to rollback (reverse) the IPO or extend the offer.
Fully Subscribed	An offer is Fully Subscribed when all the securities issued in the offer have been purchased by private and institutional investors. If all the shares in an IPO on the WSE are sold the IPO is Fully Subscribed and is automatically moved to the Official List for trading on the open market.
Market Capitalisation	Market Capitalisation is the total market value of a company. Market Capitalisation is the total Shares Outstanding in a company multiplied by the current Share Price.
Share Price	The share price is the price of a single share in a company. On the WSE the share price may refer to price per share at the time of a specific transaction or date. The current share price of a company quoted on the WSE is the price paid per share in the most recent transaction (trade) of a company, this is also referred to as the Last Price. All prices on the WSE are based on and quoted in World Internet Currency.
Trade	A trade is when the buy and sell orders between a buyer and seller have been matched and the transaction has been successfully executed. The WSE matches orders based on their position in the order queue. The order position in the queue is determined by the price per share, date and time the order was posted.
Escrow	Escrow is an arrangement in which an asset (such as cash, property or securities) is deposited into safekeeping (e.g. a trust account) under the guardianship of a neutral third party (escrow agent) pending satisfaction that the agreed transaction terms between multiple parties being achieved. Once the terms have been met, the escrow agent will deliver the asset to the party prescribed by the terms. World Internet Currency or Securities assigned to a Participants account on the WSE required to fill any orders on the WSE marketplace are immediately deducted from a Participants account and escrowed until the orders are filled and executed or cancelled. No interest is paid on escrowed WICS.
Market Order	A Market Order is an order to buy or sell securities immediately. The order is matched with any available open orders required to successfully execute the order irrespective of the price per security. Executing a market order could result in significantly increasing or decreasing the price of a security if the majority of outstanding open orders in the order queue are filled to meet the market order. Executing a market order may also result in significantly overvaluing or undervaluing the securities being traded.
At-Limit Order	At-Limit orders or Open Orders are a method to buy or sell a set number of securities at a specified price or better. Limit orders also allow the trader to limit the length of time an order can be outstanding before it is cancelled.
Conditional Order	Conditional orders are a method to buy or sell a set number of securities at a specified price, volume or percentage level using an upper or lower trigger.
Split	Split, Share Split, Stock Split, Scrip Issue, Bonus Issue, Capitalisation Issue or Free Issue is when a companies existing shares are divided into multiple shares. The amount of shares outstanding increases by a specific multiple. A split is usually implemented if the share price of a company has reached a price that investors may find unattractive and over valued. Once the split has been completed the company is removed from a trading halt and will begin trading the with same share price it had just prior to the split. After the split each share will be worth less as the net asset value and earnings per share per share has decreased which will cause the share price to decrease. The overall company Market Capitalisation should remain similar or the same to what it was before the Split.
Reverse-Split	A Reverse Split is when a companies existing shares are reduced. A Reverse Split decreases the total number of outstanding shares. Once the reverse split has been completed the company is removed from a trading halt and will initially begin trading the with same share price it had just prior to the reverse split. After the reverse split each share will be worth more as the net asset value and earnings per share per share has increased which will cause the share price to increase. The overall company Market Capitalisation should remain similar or the same to what it was before the Reverse Split.
Merger & Acquisition	Merger & Acquisition (M&A). A merger occurs when one company acquires all the assets and all the liabilities of another company. The acquiring company retains its identity, while the acquired firm ceases to exist. A merger is just one type of acquisition. A company can also acquire another company using several methods such as purchasing some or all of the assets or buying up the majority of outstanding shares in the target company.
Reverse Takeover	A Reverse Takeover (RTO) is type of merger used by private companies to become publicly traded without resorting to an initial public offering. Initially, the private company buys enough shares to control a publicly traded company. The controlling shareholder in private company uses their shares in the private company to exchange for shares in the public company. At this point, the private company becomes the Public company and the controlling shareholder in the private company generally becomes the largest individual shareholder in the Public company. The new company is usually renamed to a new name or that of the acquiring company.
Trading Halt	A Trading Halt is the process of halting all trading in the securities of a company listed on the Stock Exchange.
Delisting	A Delisting is when a company listed on the Stock Exchange either: held a share buyback and taken the company private; been delisted by the Stock Exchange due to a breach of rules or policy; or the company has moved to another Stock Exchange. A company listed on the WSE cannot move to another fictional securities exchange.
Resolution	A Resolution is a formal statement of a decision or expression of opinion put before or adopted by the Board of Directors or Shareholders of a Company. A Resolution on the WSE is a proposal or expression of opinion put before shareholders by the CEO of a company for a vote to determine if shareholders are For or Against the Resolution.
Insider Trading	Insider Trading is when officeholders, senior employees or major shareholders with over 10% of the shares of a company trade securities in the company based on inside information that has not yet been released by the company to the public or the market. An inside trade by a Participant on the WSE is not permitted in the game and is a breach of the WSE Market Rules.
Fund	An Investment Fund, Mutual Fund, Superannuation Fund, Pension Fund is a professionally-managed fund of investments that collects money from many investors and allocates the capital under management into one or more investment vehicles such as shares, bonds, options, cash, futures, debentures, other securities and property in order to generate a profits that are distributed to investors in the form of dividends or as a fixed rate of return paid monthly, quarterly or annually. A Fund on the WSE is managed by the CEO of the Fund who also assumes the additional role of Fund Manager. The Fund will generally charge a management fee rather than received dividends from any profits generated by the Fund.
Trading Room	Trading rooms often consists of open-space large offices where financial workers (often referred to as "traders") monitor the markets, develop financial products, or engage into trading activities. The Trading Room on WSE is a trading portal and provides Participants with an ability to add/remove selected companies to and from the Watchlist, view Real-time Quotes (Prices) along with placing and executing orders.
Research Centre	The Research Centre is a research portal and provides Participants with an ability to research WSE Listed Companies. The Research Centre consists of a Company Profile and charts with key company, operational and financial information for general, technical and fundamental analysis. All information in the Research Centre is for game purposes only.
Gift Facility	The WSE Gift facility allows Participants to send World Internet Currency or Securities to Friends
WSE Associate Program	The WSE Associate Program is a feature allowing Participants to invite friends and earn up to 1.5% trading commission from any new Participants they refer to the WSE. Any user who refers another user becomes a WSE Associate.
World Internet Bank	The World Internet Bank (WIB) is a feature of the WSE service that allows users to receive interest on the World Internet Currency assigned to their account balance. WIB is not a real or legally recognised bank or banking service and is only a feature providing a simulated banking environment on the WSE service. The WSE endeavours to maintain a strict Cash Reserve Ratio (CRR) to ensure sufficient liquidity of World Internet Currency for the market participants. CRR is the percentage of total deposits held in reserve and not committed to investments. Real life banks (Deposit Taking Institutions) generally hold a CRR of 0-10%.
World Internet Currency	The World Internet Currency (WIC, WIC's, W$) is a Fictional Currency owned and operated by WIC Exchange located at www.wicexchange.com. The WSE platform operates using the World Internet Currency as play money allowing each Participant to deposit and withdraw WIC's between WIC Exchange and the WSE, buy and sell securities and for CEO's to raise WIC's for their business. Users can buy and sell their license to use WIC for US dollars on WIC Exchange via PayPal, VISA or Mastercard. The value of the license is determined by the total amount of WIC assigned to that license multiplied by a fixed exchange rate at the time of the transaction. Using the World Internet Currency and exchanging the WIC License is subject to the Terms of Service by WIC Exchange.

THE MARKET

About the WSE

The World Stock Exchange is a fictional securities exchange and banking role play game providing users with a simulated environment for educational and entertainment purposes. Participants use a fictional currency called World Internet Currency (WIC) as play money.

Trading Hours - Open 24 hours, 7 Days Across all Time Zones

All time references on the WSE site are in GMT/UTC/Zulu, 0:00
(UTC - Coordinated Universal Time, GMT - Greenwich Mean Time)

Bonus Credits and Prizes

Bonus World Internet Currency may be assigned to new and existing user accounts from time to time as prizes, introductory offers or to provide additional liquidity in the market.

Brokerage – Trading Fee

Brokerage,Trading Fee, Commission (collectively “Brokerage”) is a trading fee charged in World Internet Currency as a commission on the sale of all securities by a Trader on the WSE. The WSE charges Participants a 3% commission on the sale of all securities. The trading fee is deducted from a Participants account balance.

Fictional Banking and Interest Feature

The WSE provides Participants with a fictional bank called the World Internet Bank in order to provide a simulated banking environment. Any World Internet Currency deposited in the WSE and assigned to an Account Balance will earn bonus interest. The interest rate is calculated daily and credited to accounts every 14 days.

WSE Associate Program

The WSE Associate program allows users to receive up to 1.5% commission on trades from referrals in their downline. When a user (main associate: Level 1) introduces a new user (sub-associate: Level 2) they become the direct referral.

The Main Associate earns a percentage on trading commission from the Sub-Associate (Level 2) and from any Sub-Associates (Level 3 & 4) of the direct Sub-Associate (Level 2).

Associate Percentages:

Level 1 (Main Associate)

0.8% - Level 2 (Direct Sub-Associate)
0.4% - Level 3 (Sub-Associates)
0.3% - Level 4

If a Level 4 Participant sells W$100 worth of securities then the direct referring Level 3 Participant will earn W$0.80, Level 2 will earn W$0.40 and Level 1 will earn W$0.30

Associate earnings are credited to Associate accounts every 7 days. Users can view the Associate report using the Associate Administration menu option.

WSE Gift Facility

The WSE Gift facility allows Participants to send World Internet Currency or Securities to Friends, this feature is limited to W$50.00 per 24 hours. (In development)

Code of Conduct

All Participants must adhere to the WSE Terms of Service, Listing Rules and Market Rules. We recommend that all Participants read and adopt the Hope Capital Virtues located at http://www.wselive.com/info/virtues. The Hope Capital Virtues are a moral code that guides the conduct of Participants and their interactions with each other and the wider community to provide an improved user experience.

Listing Approval Process

A Participant who submits an IPO application for listing on the WSE will automatically be creating a Company on the WSE and accepting the role as CEO of that Company. The company and CEO must comply with the WSE Listing Rules to be approved as an IPO or quoted on the WSE.

The WSE Listing Rules govern the admission of a Company to the official list, quotation of securities.

Market Review Process

On the 5th day of every month the WSE reviews all companies listed on the WSE to ensure they are adhering to the WSE Listing Rules and Market Rules. The WSE Market Review involves a review of all financial and operational reports for the previous 30 day period. A WSE Concierge may contact the CEO of a WSE Listed Company via email to request information relating to an announcement, inside trade, financial or operational report.

The WSE requires a CEO to respond to a request for more information from the WSE within 7 days from the initial request. If the WSE does not receive a response from a CEO by the 8th day, the WSE will suspend trading of the companies securities and place the company in a Trading Halt. The company will remain in a Trading Halt for an additional 14 days during which time the WSE will attempt to contact the CEO using all possible information available to the WSE. On the basis the requested information has been provided by a CEO, WSE will remove the suspension and trading halt and the company will resume trading. The company will resume trading at the last price per security of the most recent trade at the time of suspension. If the CEO has not responded and was not contactable during the additional 14 day period, the WSE will place the company into a permanent trading halt and remove from the company from the WSE Official List until further notice.

Securities in a WSE Listed Company that has been placed in a permanent trading halt will no longer display in a Participants portfolio, cannot be traded and are no longer considered active.

ANALYSTS

Market Analyst

An analyst studies companies listed on the WSE and provides the market with reviews and buy or sell recommendations on the securities.

Analyst Approval Process

A Participant may submit an application to become an approved WSE Market Analyst. The role of a WSE Market Analyst is to review and analyse the trends, financial and operational performance of companies listed on the WSE using all available resources such as current and historical data on the company profile and available charts. The WSE aims to review an application within 72 hours. The WSE will contact the Participant via email with the approval outcome of their application. A WSE Market analyst is for game purposes only and does not provide real or legally approved investment or financial advice. The role provides an opportunity for Participants who use the WSE regularly to share information and trends based on their observations.

Bond Rating System

This feature allows analysts to review performance of a bond along with the ability to assign a rating to the bonds. Analysts can update the rating status at any time by posting a new review and rating. Bond ratings are displayed as letters ranging from 'AAA', the highest grade, to 'D', the lowest grade. The Bond ratings on the WSE are based on the Standard & Poor's format.

AAA & AA - High credit-quality investment grade
AA & BBB - Medium credit-quality investment grade
BB & B - Medium credit-quality investment grade
CCC, CC, C - Low credit-quality (non-investment grade), or "junk bonds"
D - Bonds in default for non-payment of principal and/or interest

TRADING

Market Orders

Market Orders

A Market Order is an order to buy or sell securities immediately. Participants may place a market order to buy or sell securities based on a specified number of securities or until a specified budget has been reached. The market order is matched with open orders in the order queue to successfully execute the order irrespective of the price per security. The WSE platform attempts to execute all market orders within 15 seconds. Market orders may take slightly longer to confirm for large orders or during high volume periods.

Limit Orders

At Limit orders are a method to buy or sell a set number of securities at a specified price or better. Limit orders also allow a participant to limit the length of time an order can be outstanding before being canceled.

Conditional Orders

When setting a Price and Volume conditional order users can set up to 3 parameters:

* Trigger Price

* Upper or Lower Limit (optional), and

* Volume (optional)

Using just Trigger Price simply means your Conditional Order will trigger at that exact price and send a Buy or Sell order to market. With the Price and Limit Order users can also include an Upper or Lower Limit Price. If the securities price moves beyond the Upper or Lower Limit Price then your Conditional Order will not be sent to market.

You can further refine your order by selecting a volume level the security must reach before finally triggering. If the security reaches the chosen price and volume your Conditional Order will trigger. WSE will vet your order details for available security holdings or WICS, and will place a Buy or Sell order to market.

All Conditional Orders triggered and accepted by WSE for buying a Security, will be placed into the market at 3 price steps higher than the last sale price at the time the Conditional Order Triggered, unless you have specified a maximum limit price below that figure. All Conditional Orders triggered and accepted by WSE for selling a Security, will be placed into the market at 3 price steps lower than the last sale price at the time the Conditional Order Triggered, unless you have specified a minimum limit price above that figure.

This is the same basis that we calculate the price of “At Market” orders. Although every effort is made to place the order as quickly as possible, there is no guarantee that any quoted price will be achieved. The execution price may be different to the price at which it was placed to market. Whilst we will place your order to market as an “At Limit” order based upon these price details*, there is no guarantee your order will execute.

Trailing Orders

A Trailing Buy is a Conditional Order that uses a trailing price mechanism to place a BUY order on a selected security. You set the Trigger Price as a trailing percentage based upon the previous 24 hour high/low/close. This Buy Trigger Price is then recalculated overnight and is not a static figure, unlike the basic Price and Volume order. If a stock falls to or rises to the Trigger Price a Buy order will be placed to market for you. There are two types of Trailing Buy orders - Price Rising and Price Falling. If a stock falls to or rises to the Trigger Price a Buy order will be placed to market for you.

LISTED ENTITIES

A Listed Entity, (Business, Company, WSE Listed Company) is a group account solely for use on the WSE and managed by a Participant playing the role of CEO in the WSE role-playing game. A company on the WSE is not a real or legally registered entity or business. The Participant may participate in the WSE service on behalf of a real and legally registered entity or business provided the Participant has sought and received written, signed consent from the business proprietor or director's along with additional approvals for items such as IP rights. All information submitted by the Participant acting as CEO is for game purposes only and may not be reliable, true, accurate or credible and is subject to the WSE Terms of Service.

Officeholders

Conflict of Interest

If a director of a the company has a material personal interest in a matter that relates to the affairs of the company and:

a) the director discloses the nature and extent of the interests and its relation to the affairs of the company at a meeting of the directors; or (b) the interest is one that does not need to be disclosed; then (c) the director may vote on matters that relate to the interest; and (d) any transaction that relate to the interest may proceed; and (e) the director may retain benefits under the transaction even though the director has the interest; and (f) the company cannot avoid the transaction merely because of the existence of the interest.

If disclosure is required, paragraph (e) and (f) apply only if the disclosure is made before the transaction is entered into. A Director may need to give notice to the other directors if the director has material personal interest in a matter relating to the affairs of the company.

Risk Management

The company must recognise its business activities involve risk, and undertakes an ongoing review of business risk. While it is important that risks are identified and monitored by management and the Board, it is not possible (or desirable) for the company to eliminate all risks. There will be some risks the company is prepared to accept, having regard to the cost of risk mitigation relative to the benefit likely to accrue from it.

Management and the Board are responsible for the internal controls of the company. The Board monitors strategic, operational and financial aspects and considers the advice of external auditors and other external advisers on operational and financial risks the company faces.

Powers of Directors

The business of the company is to be managed by or under the direction of the Managing Director and Chief Executive Officer. The Managing Director may exercise all the powers of the company. For example, the Managing Director may issue shares or bonds and hold secondary offers.

Managing Director

The founder of the company and owner of the WSE group account is designated with the title of Managing Director and Chief Executive Officer and has all of the powers that the directors can exercise.

Company may appoint a Director

The founder may appoint directors prior to the company joining the Official List. Once the company has entered the Official List and is actively trading, the founder may appoint a director by resolution.

Director Resignation

A director of a company may resign as a director of the company by giving a written notice of resignation sent to the WSE.

Removal of Directors

The company may by resolution remove a director from office with the option to appoint a replacement director except for the Managing Director who cannot be removed from office without his or her consent and agreement.

Shareholder Communications and Continuous Disclosure

The company recognises the importance of communication with its Shareholders and that, after it becomes listed, it will have continuous disclosure obligations under the Market Rules in respect of material price-sensitive information. The company must provide a minimum of one announcement and report each month to shareholders detailing the companies current operational and financial performance and outlook.

Securities Trading Policy

The Company prohibits insider trading by Directors and employees when trading in the Company securities. The Director's and Employees must not participate in any transactions of shares within 7 days of a major announcement that is likely to have an impact on the share price. The Managing Director cannot sell any shares in the company within 90 days from being admitted to the WSE Official List. The sale of any securities held in the name of the Managing Director of the company must be disclosed to the market a minimum of 72 hours from the time of sale. The Managing Director cannot trade any securities in the entity without approval by the WSE.

Remuneration of Directors

Executive and Non-Executive Directors

The Market Rules provides that Directors are entitled to remuneration as determined by the Board, but the remuneration must not include a commission on or percentage of operating revenue. While the remuneration arrangements do not currently include a bonus element, the Board may consider the inclusion of bonus arrangements for these executives in the future, based on the achievement of agreed performance indicators.

Announcements

The WSE platform provides a facility for the CEO to post announcements related to the latest news and operational information related to a WSE Listed Company.

Announcements that can be perceived as negative towards the WSE are not permitted as they could have a negative impact on market sentiment and result in lower prices, poor investor confidence and less liquidity. The World Stock Exchange may edit spelling and grammatical errors or remove any content which is has deemed a breach of the WSE Game Rules or Terms of Service. Advertisements and content related to third party fictional stock exchange and banking services are not permitted.

Share Capital and Rights

Issuing shares

- The Directors may, subject to any restrictions on allotment of shares imposed by the Game Rules, from time to time issue and allot further shares on such terms and conditions as they see fit.

- To make the offer, the directors must give the shareholders a statement setting out the terms of the offer including the number of shares offered and the period for which the offer will remain open.

- The directors may issue any shares not taken up under the offer as they see fit.

- The company must make available any new offer of shares to the existing shareholders unless a resolution passed at a general meeting authorising the directors to make a particular issue of shares without complying with the requirement of offering them to existing shareholders.

Dividend Policy

The Directors of a company listed on the WSE will consider the payment of a dividend in the context of the Company’s expansion plans and based on the requirement for funding for growth opportunities and capital expenditure commitments.

Directors can give no assurance about the payment of a dividend. Thereafter, the Directors intend to implement a dividend policy involving the payment of dividends representing a minimum of 5% of profits. In any case, any determination about the company’ paying dividends will be at the Directors’ discretion having regard to, among other things, the availability of earnings for distribution to shareholders, the Company’s operating results, capital expenditure requirements and general business and market conditions.

Decisions regarding the amount and frequency of dividends are solely at the discretion of the board of directors. Dividends maybe paid fortnightly, monthly or quarterly.

Minimum Investment

An Application for securities under an Offer must contain a minimum subscription of securities. There is no maximum number of securities that may be applied for in an specific offer.

Withdrawal and early closure of Offer

The company may, in its discretion withdraw or close the Offer at any time before the closing date for the Offer. If the Offer is withdrawn, all World Internet Currency will be refunded. No interest is paid on escrowed WICS.

Liquidation Rights

The company has one class of shares on issue, ordinary shares. Each ordinary Share ranks equally in the event of liquidation. The liquidation value is calculated as the Net Tangible Asset and is displayed on the company profile.

Voting Rights

A Director may propose a resolution to all shareholders on behalf of one or more shareholders, every shareholder present in person or by proxy has one vote per share owned on a vote using WSE voting system. In order for a resolution to be passed, a simple majority is required.

Bonds

The Directors may, subject to any restrictions on allotment of bonds imposed by the Game Rules, from time to time issue and allot further bonds on such terms and conditions as they see fit.

- To make the offer, the directors must give the bondholders a statement setting out the terms of the offer including the number of bonds offered and the period for which the offer will remain open.

- The company must make available any new offer of bonds to the existing bondholders unless a resolution passed at a general meeting authorising the directors to make a particular issue of shares without complying with the requirement of offering them to existing shareholders.

- Interest payments to bondholders are subject to the terms expressed in the bond offer and on any milestones or targets being achieved. If the director's feel that the interest commitment on the bond cannot be met on more than one date, the company may convert all bonds to shares using a ratio determined by the current bond and share price.