PRÓSPERA ZEDE e-RESIDENT AGREEMENT OF COEXISTENCE
Article I. Premises
Section 1. Purpose. The purpose of this Contract is to provide for clarity and legal stability with respect to the rights and mutual obligations of the Próspera ZEDE, its officers, agents, delegates, instrumentalities, and affiliates by majority ownership or control (the “PZ”), on the one hand, and the undersigned person (“e-Resident”), on the other hand, effective as of latest date of signature below (“Effective Date”).
Section 2. e-Residency Permit. Subject to the terms and conditions of this Contract, the PZ hereby grants a permit of e-residency to the e-Resident which is a personal, non-assignable license to access certain PZ e-governance services, to do business within the PZ, and to own or lease real property within the PZ, as well as to physically access and visit the PZ for up to thirty (30) days per calendar year. In exchange, the e-Resident promises to honor the terms and conditions of this Contract. The term of the e-Residency Permit is year-to-year until terminated (“e-Residency Term”).
Article II. Obligations of e-Resident
Section 1. Governance Principles. By executing this Contract, the e-Resident:
- represents and warrants having had an adequate opportunity to become informed about the PZ’s Amended and Restated Charter and Bylaws, as amended from time to time (the “PZ Charter”), the ZEDE Organic Law, Decreto No. 120-2013 (the “Organic Law”), the Constitution of the Republic of Honduras generally, and articles 294, 303, and 329 thereof specifically, the criminal code of the Republic of Honduras, the PZ Statutes, Regulations, Ordinances, and Resolutions (“PZ Rules”), including related schedules of civil penalties that are officially published as of the Effective Date, all available at http://pzgps.hn/ (collectively “PZ Law”); and
- is knowingly and voluntarily consenting: (i) to such delegation of popular sovereignty as is necessary to sustain the power and authority held in trust by the PZ under the PZ Charter for the benefit of the e-Resident and all other residents;
- to being governed under the provisions of the PZ Charter, and PZ Rules promulgated and civil penalties posted pursuant thereto, by the Technical Secretary, PZ Council, PZ General Service Provider, PZ Court, PZ default Arbitration Service Provider, PZ Ombudsman, PZ Trust, and the Comité para la Adopción de Mejores Prácticas (Committee for the Adoption of Best Practices); and
- to complying with the provisions of the PZ Promoter and Organizer’s master plan common interest community declaration, which shall run with title to all land and severable rights within the boundaries of the PZ (the “Declaration”), when it is duly registered in the PZ Property Registry.
Section 2. Respect for Legally Protected Rights. The e-Resident shall refrain from violating all legally protected rights of all persons; including, but not limited to, refraining from a breach of this Contract.
Section 3. Identification. Upon the Effective Date of this Contract, the e-Resident (if a natural person) will be furnished with one or more identification card(s) that must be utilized as evidence of this e-Residency Permit (the e-Resident may be ejected from the PZ or detained in the event that the identification card is not furnished for inspection upon request by a person who is duly authorized to make such request).
Additionally, during the e-Residency Term, the e-Resident shall furnish the PZ with an annual sworn or certified statement, on such forms as prescribed by PZ Resolution, containing current contact information, as well as facts concerning the existence and nature of any physical presence, domicile, principal place of business, or real property interest within the jurisdictional boundaries of the PZ.
Further, the e-Resident consents to the PZ posting and authorizing the posting of information in connection with the e-Resident on the PZ Personal Registry (if a natural person) or the PZ Entity Registry (if a legal entity) regarding the adverse disposition of PZ court cases or public private arbitration proceedings in an online searchable format.
Furthermore, the e-Resident hereby:
- acknowledges that the PZ recommends e-Resident maintain a general liability insurance policy covering liability for any award issued by an arbitral tribunal of the default Arbitration Service Provider, as well as acts or omissions occurring within the PZ or otherwise arising from interactions with the PZ or any physical or e-resident of the PZ during the e-Residency Term either through the Resident’s carrier(s) of choice or through the PZ General Services Provider or its preferred carrier(s); and
- consents to the PZ publicly registering in connection with e-Resident’s identification in the PZ Personal Registry or PZ Entity Registry, as applicable, the existence or non-existence of such coverage, the identification of the carrier(s), a summary of coverage(s) and limits, and whether such coverage(s) and limits meet the minimum standards adopted by the PZ for its physical residents.
Section 4. e-Gov License Fee. On or before the Effective Date, and thereafter on the 1st business day of each subsequent calendar year within the e-Residency Term, the e-Resident shall pay to the PZ Promoter and Organizer at such account as provided by the PZ the following annual “e-Gov License Fee:” $130.00 U.S. or 3,120 Lempira.
Payment of the e-Gov License Fee qualifies the e-Resident, as an incident of this e-Residency Permit, to access and use the following services, subject to posted fees, terms and conditions, under license from the PZ Promoter and Organizer:
(a) the PZ Property Registry, as available; (b) the PZ Entity Registry, as available; (c) the PZ Personal Registry, as available; and (d) the PZ default Arbitration Service Provider, as available (collectively “e-Gov Services”).
The e-Gov License Fee may be increased or decreased annually by the PZ to such amount of U.S. Dollars or Lempira as corresponds to the spot price of 0.10 (troy) ounces (~3.11 grams) of gold in COMEX (or otherwise the market with the highest volume of trade in gold) at the close of business on the last business day of the year of the immediately preceding calendar year.
Section 5. e-Resident Representations and Warranties. The e-Resident represents and warrants as an essential part of this Contract that:
- the e-Resident is not engaging in and shall not engage in criminal or fraudulent activity in any jurisdiction to the extent that such activity would constitute criminal or fraudulent activity according to PZ Law if it occurred within the boundaries of the PZ, excluding traffic or parking offenses; and
- the e-Resident (including the e-Resident’s officers and directors, if the e-Resident is a legal entity) has not engaged in criminal or fraudulent activity in any jurisdiction within the TEN (10) years preceding the Effective Date, excluding traffic or parking offenses.
Article III. Obligations of PZ
Section 1. Recognition of e-Residency. Upon receipt of the e-Gov License Fee and signing of this Contract, and so long as the e-Resident is not in default under the terms and conditions of this Contract (i.e., is in “good standing”), the PZ shall furnish the e-Resident with one or more identification card(s) and recognize the e-Resident as having an e-Residency Permit for the e-Residency Term.
Section 2. Services. The PZ shall use reasonable, good faith efforts to maintain (or cause to be maintained) the platform for e-Gov Services with minimal downtime.
Section 3. PZ Acknowledgment of Limited Power. The PZ may not claim or exercise any governing or enforceable power or authority relative to the e-Resident that is not authorized by the public meaning of the text of (a) this Contract, (b) the Declaration, if any, and (c) PZ Law.
Section 4. Resident Bill of Rights. The PZ shall honor and enforce the Resident Bill of Rights of article 12 of the PZ Charter as it existed on the Effective Date, which is incorporated herein by reference, throughout the e-Residency Term in regard to its interactions with the e-Resident.
Further, pursuant to its authority to enter into legal stability agreements, the PZ promises and guarantees to the e-Resident that, throughout the e-Residency Term, it shall not claim or exercise any governing or enforceable power or authority relative to the e-Resident, directly or indirectly through any agent or instrumentality, that in any way or to any degree prejudices or infringes upon the plain public meaning of the e-Resident’s rights, privileges and immunities guaranteed by the Resident Bill of Rights on the Effective Date.
If the PZ should amend through any process, including referendum, the Resident Bill of Rights as it existed on the Effective Date, any such amendment shall not apply or be applied directly or indirectly to the e-Resident during the e-Residency Term unless the PZ secures the e-Resident’s separate written knowing and voluntary consent to such amendment for good and valuable consideration and without requiring such agreement as a condition of maintaining the license granted under this Contract.
Any breach of the promises of legal stability in this section is a material breach of this Contract justifying prohibitory and mandatory injunctive relief in favor of the e-Resident, which may be a component of the relief granted by arbitration award; and, if such breach is proven to be intentional and to cause injury to the e-Resident, then the liability of the PZ for damages arising from such injury shall not be limited notwithstanding anything to the contrary in this Contract or in PZ Law.
Article IV. Dispute Resolution
Section 1. e-Resident’s Agreement to Arbitrate Disputes. Except for claims and causes of action expressly excluded from arbitration by the Organic Law, the e-Resident and the PZ shall exclusively resort to, comply with and be subject to arbitration hereunder as the exclusive means of resolving any cause of action, dispute, controversy, or claim between or among the e-Resident, the PZ, the PZ Trust, the PZ General Service Provider, or any third party accepting the standing offer of Section 2 of Article IV, or their representatives, officers, agents, employees and affiliates, arising out of, relating to or connected with all or any part of this Contract, any subsequent amendment, modification or waiver of all or any part of this Contract, the Declaration, if any, PZ Law, and that of any other transactionally-related document, including, without limitation, any question in relation to or regarding this Contract’s formation, binding effect, interpretation, performance, violation, breach, existence, nullity, validity or termination, as well as any related non-contractual dispute, controversy or claim in accordance with articles 20, 21, 28, and 35 of the Organic Law, sections 9.02 and 11.03 of the PZ Charter, and the PZ Arbitration Statute 2019 as of the Effective Date, and any cause of action otherwise arising in connection with the exercise of rights, privileges or immunities under PZ Law.
- The arbitration required by this section shall be administered by the PZ default Arbitration Service Provider unless the dispute is
- covered by a separate arbitration agreement selecting a different arbitration administrator or
- the e-Resident otherwise objects to the use of the default Arbitration Service Provider within seven (7) days after receiving notice of the filing of an arbitration demand. If the e-Resident objects to the use of the default Arbitration Service Provider as aforesaid, then the e-Resident and PZ agree to the International Centre for Dispute Resolution of the American Arbitration Association (“AAA”) serving as the arbitration administrator under this section.
- Any arbitration commenced hereunder shall be an arbitration under the PZ Arbitration Statute 2019 as of the Effective Date, available at http://pzgps.hn/. The arbitration shall be governed by the Rules of the arbitration administrator (hereinafter the “Rules”) in force as of the filing of the demand for arbitration, which Rules are deemed to be incorporated by reference into this clause. The appointing authority for the arbitral tribunal shall be the parties acting in accordance with the Rules. The seat of arbitration shall be any location permitted by the Rules upon which the parties agree or, if the parties do not agree, then any location selected by the arbitration administrator. The language to be used in the arbitral proceedings shall be English and Spanish with English being the controlling language. The governing substantive law of the arbitration shall be the applicable PZ Law. The number of arbitrators serving as the arbitral tribunal shall be one (1) or as otherwise provided by the Rules. The arbitral tribunal shall render its final decision in not more than one (1) year after commencement of arbitral proceedings.
- This arbitration agreement and any resulting arbitration award shall be enforceable and executable as authorized by the PZ Arbitration Statute 2019 as amended as of the Effective Date. Any challenge by either party to the validity or enforceability of this arbitration agreement or the arbitration award may be referred only to the arbitral tribunal hereunder appointed. Each party hereby waives its rights, if any, to any form of recourse against or challenge to an arbitration award to any court or other competent authority, if such waiver can validly be made under the applicable law. Accordingly, each party shall
- hereby irrevocably and unconditionally submit to the personal jurisdiction of the seat of arbitration and arbitral forum for the purpose of any suit, action, or other proceeding arising out of or based upon the dispute;
- hereby irrevocably and unconditionally submit to the personal jurisdiction of the seat of arbitration and arbitral forum for the purpose of any suit, action, or other proceeding arising out of or based upon the dispute;
- shall not commence any suit, action or other proceeding arising out of or based upon this Contract except in the seat of arbitration and arbitral forum (except as needed for enforcement of an arbitration award); and
- hereby waives, and shall not assert, by way of motion, as a defense, or otherwise, in any proceeding, any claim that it is not subject to the personal jurisdiction of the seat of arbitration, that its property is exempt or immune from attachment or execution, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Contract, or the subject matter hereof and thereof may not be enforced in or by the seat of arbitration.
- The parties:
- agree the matters governed by this arbitration agreement are capable of arbitration;
- respectively warrant that each has legal capacity to agree to arbitration as herein stated;
- warrant that this agreement to arbitrate is legally valid;
- agree that each party shall be regarded conclusively as having fully anticipated and envisaged every potential controversy or claim encompassed by the dispute as governed by this agreement to arbitrate and shall comply with any resulting arbitration award or decision;
- agree that the parties shall not seek to annul or suspend any resulting arbitral decision or award which is rendered in accordance with the terms of this arbitration agreement;
- agree and acknowledge that the counterparty(ies) is (are) reasonably and materially relying upon this arbitration agreement as being valid and legally binding;
- agree and acknowledge waiving the right to challenge this arbitration agreement, and any jurisdiction exercised or remedy furnished thereunder, as invalid or otherwise not legally binding; and
- agree any dispute arbitrated hereunder is subject to the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, June 10, 1958), which the Republic of Honduras joined on August 21, 2012 (“New York Convention”), and shall be construed as arising from a commercial legal relationship, and also that the enforcement of an arbitration award issued pursuant to this arbitration agreement shall not be considered a domestic award in any court in which it is enforced.
Section 2. Standing Offer to Arbitrate. During the e-Residency Term, the e-Resident agrees to arbitrate any dispute with any third party arising from any cause of action arising from any act, omission, fact or event occurring within the boundaries of the PZ, or otherwise arising in connection with (a) the e-Resident acting in the disclosed capacity as an e-Resident or (b) the e-Resident’s exercise of rights, privileges or immunities under PZ Law, pursuant to the terms of subsections (a) through (d) of Section 1 of this Article (unless the e-Resident has verifiably contracted to use a different means of dispute resolution to fully and finally resolve the dispute with the relevant third party).
Accordingly, the e-Resident shall be deemed hereby to authorize the PZ to publicly post or cause the public posting of a standing open offer on behalf of the e-Resident in the PZ Personal Registry or PZ Entity Registry, as applicable, to fully and finally resolve any such dispute involving the e-Resident through the PZ’s designated default Arbitration Service Provider (and to be legally bound by its publicly posted fees, rules, terms and conditions), with the offer capable of acceptance by any aggrieved third party prior to the initiation of litigation or arbitration by emailing a conforming manifestation of such acceptance to the respective e-Resident’s e-governance residency email address, as specified below (“Residency Email Address”).
Article V. Miscellaneous Provisions
Section 1. Termination. Notwithstanding anything to the contrary set forth anywhere herein or elsewhere, this Contract may be terminated as follows:
- Beta Testing/Probationary Period. The PZ may immediately terminate this Contract upon at least sixty (60) days prior notice to the e-Resident for any reason (or without cause) at any time occurring within the latter of either (i) the first year of the e-Residency Term or (ii) the period of time encompassed by the Effective Date through December 31, 2021.
- The PZ may terminate this Contract whenever the e-Resident has breached any provision of this Contract and such breach has not been cured, or is incapable of being cured, within thirty (30) days of e-Resident being given notice of the breach by the PZ.
- The e-Resident may terminate this Contract for any reason (or without cause) upon at least seven (7) days prior notice to the PZ.
Section 2. Effect of Termination. The following consequences may flow from a termination of this Contract:
- Upon termination of this Contract, the e-Resident is required to vacate the PZ completely and immediately; if the e-Resident fails to so vacate the PZ, the PZ may in the absence of the e-Resident prevailing in an arbitration or court challenge to the termination of this Contract: (i) deny or cause the denial of access by the e-Resident to: (1) the PZ, (2) the e-Resident’s real property within the PZ, and (3) all PZ services including the e-Gov Services; and (ii) eject or direct the ejection of the e-Resident and all of the e-Resident’s movable or personal property from the PZ, subject to distraint for unpaid fees or taxes under PZ Law.
- In the absence of a pending or successful court or arbitration proceeding challenging the termination of this Contract, within the earlier period of either twelve (12) months after a termination of this Contract or thirty (30) days after receiving a final court or arbitration decision sustaining the termination of this Contract, the e-Resident shall sell and transfer title to any real property located within the PZ to another physical resident or e-resident who is in good standing. If the e-Resident fails to timely transfer such title, the PZ shall be entitled, without further notice or an opportunity to be heard, to record with the PZ Property Registry the e-Resident’s obligation to transfer title as aforesaid as a charge against such title, and to commence foreclosure sale proceedings to enforce such charge under the PZ Mortgage Foreclosure Sale Statute as an exercise of a duly authorized power of sale, with proceeds from the sale to be promptly paid to the e-Resident or its assignee less expenses incurred by the PZ in conducting the sale and the amount of any outstanding taxes or fees owed by e-Resident.
- After termination of this Contract and compliance with this section, the e-Resident shall be released from any subsequently accrued or incurred obligation or liability to the PZ that may have otherwise accrued; however, all previously accrued or incurred obligations and liabilities of the e-Resident to any of the PZ or the default Arbitration Service Provider shall survive termination and remain enforceable, and any previously paid fees or taxes shall not be refunded.
Section 3. Notices. Notice shall be deemed effectively given to the other party under this Contract when sent by email with proof of delivery receipt at the party’s Residency Email Address. Otherwise, notice shall be deemed effectively given to the other party under this Contract five (5) business days after the notice is verifiably placed for delivery to such party through any other reasonable and customary mode of physical delivery at the party’s address below.
Section 4. Merger, Interpretation and Severance. This Contract constitutes the entire agreement of the parties relating to the subject matter addressed. This Contract supersedes all prior written or oral communications, contracts or agreements between the parties with respect to the subject matter addressed in this Contract. The parties agree that it is unreasonable and unjustifiable to rely on any representation, promise, term or condition that is not expressed or fairly construed into the text of this Contract. No presumption shall favor either party in interpreting this Contract. The English version of this Contract shall control the Spanish version in the event of any conflict.
Section 5. Disclosure, Disclaimer and Limitation of Liability. The e-Resident acknowledges that related entities and persons are or could be in positions of control and authority over the PZ, PZ Trust, PZ General Service Provider, PZ Promoter and Organizer, and PZ default Arbitration Service Provider, and each has or may derive a pecuniary gain directly or indirectly from decisions made by a related entity in connection with this Contract.
In recognition of the practical necessity of such joint control and authority due to the organizational and developmental phase in which the PZ is operating, and its “startup government” nature, the e-Resident waives and disclaims any claim that a breach of contract, breach of fiduciary duty, or fiduciary fraud would result or should be presumed based on any actual or apparent conflict of interest that has arisen or may arise in any way, whether directly or indirectly, from the continuation of joint control and authority over any or all of the PZ, PZ Trust, PZ General Service Provider, PZ Promoter and Organizer, and PZ default Arbitration Service Provider by related entities and persons.
Further, the e-Resident agrees that any monetary liability of the PZ arising from any cause of action connected in any way with this Contract, including claims for compensatory or exemplary damages, as well as court costs, litigation expenses, attorneys fees, shall be limited to an aggregate amount that does not exceed the greater of: (a) the limits of available insurance coverage(s) for the relevant cause of action; or (b) the difference, for the calendar year immediately preceding the incurrence of the liability, between (i) 15% of aggregate tax revenues received by the PZ and (ii) the booked liability for all other known or threatened causes of action against the PZ.
Section 6. Contract Prevails. If there is any inconsistency between the express provisions of this Contract, on the one hand, and those of any PZ Law enacted after its Effective Date (“Subsequent Law”), the provisions of this Contract shall prevail; and the PZ shall not apply such Subsequent Law to the e-Resident to the extent of such inconsistency.
Section 7. Governing Law and Jurisdiction. This Contract shall be governed by PZ Law, without regard to principles of conflict of laws. The exclusive venue(s) for resolution of all matters governed by this Contract shall be as follows: (a) if the matter is subject to arbitration under this Contract, the arbitration administrator designated under this Contract shall determine the venue; (b) if the matter is not subject to arbitration under this Contract or if judicial process is required to reach a final judgment or to execute an arbitration award, then the PZ court system shall be the exclusive venue; and (c) if the matter is not subject to arbitration under this Contract nor capable of adjudication by the PZ court system, then any foreign court of competent jurisdiction among party states to the New York Convention shall be the exclusive venue.
IN WITNESS WHEREOF, the parties have caused this Contract to be executed by their respective duly authorized signatories and have duly delivered this Contract.
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Requesting a side letter
You can propose new terms to override those in the Agreement of Coexistence as an appendix to the agreement.
For your proposal to be considered, you will need to request your Resident application by e-mail, stating the changes you want to make to the terms. The e-mail needs to be sent to (redacted to avoid spam):