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CLOSM i NFT Terms

These NFT Terms (hereinafter referred to as the "NFT Terms") set forth the conditions for using NFT-related features within the service "CLOSM i" (hereinafter referred to as the "Service") provided by CLOSM LLC (hereinafter referred to as the "Company"). These NFT Terms constitute Individual Provisions as defined in the CLOSM i Terms of Service (hereinafter referred to as the "Main Terms").

Note: In the event of any discrepancy between the English and Japanese versions of these NFT Terms, the Japanese version shall prevail.

Article 1 (Definitions)

The following terms used in these NFT Terms shall have the meanings set forth below:

  1. "NFT" means a Non-Fungible Token, a unique digital token recorded on a blockchain that represents a specific piece of Posted Content created by a User on the Service.
  2. "Blockchain" means a distributed ledger technology network, including Polygon, Ethereum, and Base, on which NFTs are recorded and transacted.
  3. "Wallet" means a third-party digital wallet application (such as MetaMask) that enables Users to interact with blockchains, hold NFTs, and sign transactions.
  4. "Minting" means the process of creating a new NFT on a blockchain by recording a unique token linked to a specific piece of Posted Content.
  5. "Gas Fee" means the blockchain network transaction fee required to process and confirm transactions on a blockchain, paid in the native cryptocurrency of the respective network (e.g., ETH for Ethereum, POL for Polygon).
  6. "Smart Contract" means the self-executing program code deployed on a blockchain that governs the creation, transfer, and royalty distribution of NFTs on the Service.
  7. "Secondary Sale" means any sale or transfer of an NFT after the initial minting, occurring on third-party marketplaces or through direct wallet-to-wallet transfer.
  8. "Royalty" means the percentage of the Secondary Sale price designated to be paid to the original creator and the Company, as encoded in the Smart Contract.
  9. "EIP-712 Signature" means a typed structured data signing standard used by the Service to obtain User authorization for minting transactions.

Article 2 (Scope and Relationship with Main Terms)

  1. These NFT Terms apply to all activities related to the use of NFT features within the Service.
  2. These NFT Terms constitute Individual Provisions as defined in Article 1, Paragraph 2 of the Main Terms. In the event of any conflict between the Main Terms and these NFT Terms regarding NFT-related matters, these NFT Terms shall prevail.
  3. Matters not specifically addressed in these NFT Terms shall be governed by the Main Terms.
  4. Users must agree to both the Main Terms and these NFT Terms before using NFT features.

Article 3 (NFT Feature Overview)

  1. Users may use the NFT features of the Service to convert their Posted Content into NFTs and record them on any of the following supported blockchains:
    • Polygon (Chain ID: 137)
    • Ethereum (Chain ID: 1)
    • Base (Chain ID: 8453)
  2. The Service uses the ERC-721 standard for NFTs, with UUPS (Universal Upgradeable Proxy Standard) proxy architecture for the Smart Contracts.
  3. Metadata and images associated with NFTs are hosted on the Company's infrastructure. The Company shall make commercially reasonable efforts to maintain the availability of metadata and images, but does not guarantee perpetual availability.
  4. NFTs minted through the Service are compatible with third-party marketplaces (such as OpenSea) that support the ERC-721 standard.

Article 4 (Minting Conditions)

  1. Eligibility: Only Users who hold an active paid plan (Lite or Premium) may use the NFT minting feature, subject to the monthly limits of their plan.
  2. Plan Limits: The number of NFTs a User may mint per month is determined by their subscription plan. Ethereum minting is available exclusively to Premium plan subscribers.
  3. Wallet Requirement: Users must connect a compatible Wallet to the Service before minting. The Company does not provide Wallet services.
  4. Authorization Process: When minting an NFT, the User will be prompted to sign an EIP-712 structured message using their connected Wallet. By signing this message, the User authorizes the Company to submit the minting transaction to the blockchain on the User's behalf. This signature:
    • Authorizes only the specific NFT minting operation described in the signing prompt
    • Does not grant the Company access to the User's funds, other tokens, or Wallet
    • Does not create any ongoing authorization beyond the specific minting transaction
  5. Gas Fees: The User is responsible for paying Gas Fees associated with minting transactions. Gas Fees are determined by blockchain network conditions and are not controlled by the Company.
  6. Transaction Finality: Once a minting transaction is confirmed on the blockchain, it cannot be reversed, canceled, or modified. Users must review all details displayed in their Wallet before confirming the signature.
  7. Content Requirement: Users may only mint Posted Content for which they hold the necessary intellectual property rights as required by Article 5 of the Main Terms.

Article 5 (Intellectual Property Rights)

  1. Copyright Retention: Copyright of the artwork associated with an NFT shall remain with the User who created the Posted Content. The minting, sale, or transfer of an NFT does not transfer copyright or any other intellectual property rights in the underlying artwork.
  2. Token Ownership: When an NFT is minted, the User who minted it acquires ownership of the digital token. Subsequent sales or transfers of the NFT transfer only the token ownership, not the copyright.
  3. Buyer License: The holder of an NFT minted on the Service receives a limited, non-exclusive, non-transferable (except in connection with the transfer of the NFT itself), worldwide license to:
    • Display the associated artwork for personal, non-commercial purposes
    • Display the NFT on third-party marketplaces and platforms that cryptographically verify ownership
    • Display the NFT on social media platforms
  4. Prohibited Uses by NFT Holders: NFT holders may not:
    • Modify, adapt, or create derivative works from the associated artwork
    • Use the artwork for commercial purposes (including merchandise, advertising, or promotional materials) without the creator's express written consent
    • Register trademarks, patents, or other intellectual property rights based on the artwork
    • Mint additional tokens representing the same artwork
  5. License Termination: The buyer license granted under Paragraph 3 terminates immediately upon the sale, transfer, or other disposition of the NFT.

Article 6 (Royalties)

  1. Royalty Structure: Each NFT minted on the Service includes a royalty of 5% (five percent) of the gross Secondary Sale price, implemented via the ERC-2981 standard. This royalty is allocated as follows:
    • Creator Royalty: 3.5% — paid to the original artwork creator
    • Platform Fee: 1.5% — retained by the Company
  2. Royalty Distribution: Royalties are distributed on-chain via a royalty splitter Smart Contract to the designated wallet addresses at the time of a Secondary Sale, when supported by the marketplace.
  3. Enforcement Limitations: Users acknowledge and agree that:
    • ERC-2981 is an informational standard that signals royalty amounts to marketplaces but does not enforce payment on-chain.
    • Royalty payment depends on whether a given marketplace honors the ERC-2981 standard. Different marketplaces have different royalty policies, which may change at any time.
    • Direct wallet-to-wallet transfers and off-platform sales may not trigger any royalty payment.
    • The Company does not guarantee that any royalty will be collected on Secondary Sales.
  4. No Investment Expectation: Royalties are compensation for the creator's original creative work and do not constitute investment returns. The Company makes no representations regarding the frequency, amount, or likelihood of Secondary Sales or royalty income.

Article 7 (Gas Fees and Costs)

  1. User Responsibility: All Gas Fees incurred in connection with minting, transferring, or transacting NFTs are the sole responsibility of the User.
  2. Variable Costs: Gas Fees vary based on blockchain network conditions and may fluctuate significantly. The Service may display gas estimates for reference, but these estimates are not guaranteed and actual costs may differ.
  3. Non-Refundable: Gas Fees, once paid, are not refundable regardless of whether the transaction succeeds or fails.
  4. Multi-Chain Differences: Gas Fees differ across the supported blockchains (Polygon, Ethereum, Base). Users should consider the cost differences when selecting a blockchain for minting.

Article 8 (Wallet Management Responsibility)

  1. Users are solely responsible for the security and management of their Wallets, including private keys, seed phrases, and login credentials.

  2. The Company does not have access to and cannot recover Users' private keys, seed phrases, or Wallet credentials. Loss of Wallet access may result in the permanent loss of NFTs.

  3. Users must verify the accuracy of all wallet addresses, transaction details, and signing prompts before confirming any transaction.

  4. The Company shall not be liable for any loss of NFTs or funds resulting from:

    • Loss or theft of Wallet credentials
    • Incorrectly entered wallet addresses
    • Unauthorized access to a User's Wallet
    • Hardware or software failures of Wallet applications

    However, this limitation does not apply in cases where such loss results from the willful misconduct or gross negligence of the Company.

Article 9 (Assumption of Risk)

  1. Users acknowledge and accept the following risks associated with NFTs and blockchain technology:

    (1) Market and Value Risk: NFTs may lose some or all of their perceived value. The Company makes no representations or guarantees regarding the current or future value of any NFT.

    (2) Blockchain Technology Risk: Blockchain networks may experience congestion, forks, technical failures, or other disruptions that may affect NFT transactions, accessibility, or functionality.

    (3) Smart Contract Risk: Smart Contracts, while audited, may contain undiscovered vulnerabilities. The Company's NFT Smart Contracts use the UUPS proxy pattern, which allows authorized administrators to upgrade contract logic through a multi-signature wallet (Gnosis Safe) requiring multiple approvals. While upgrades are intended to improve functionality and security, they carry inherent risks including potential unintended state changes. NFT ownership as recorded on the blockchain is not affected by contract logic upgrades.

    (4) Regulatory Risk: Laws and regulations governing NFTs and blockchain technology may change. Such changes could affect the legality, tax treatment, or usability of NFTs.

    (5) Multi-Chain Risk: Each supported blockchain has distinct characteristics, fee structures, security models, and ecosystem support. The behavior of NFTs may differ across blockchains.

    (6) Third-Party Risk: The Service interacts with third-party services including blockchain networks, Wallet providers, and marketplaces, which are REMOVED the Company's control.

    (7) Irreversibility: Blockchain transactions are irreversible once confirmed. Erroneous transactions cannot be undone.

  2. The Company shall make commercially reasonable efforts to mitigate the above risks, including security audits of Smart Contracts and maintaining multi-signature governance for contract administration.

Article 10 (Prohibition of Use as Payment Instrument)

  1. NFTs minted through the Service shall not be used as a means of payment or settlement for goods, services, or any other obligations.
  2. NFTs minted through the Service are intended solely as digital art tokens representing ownership of specific artworks. They are not designed or intended to function as currency, stored value, or payment instruments.
  3. The Company shall take reasonable measures to prevent the use of NFTs minted through the Service as payment instruments.

Article 11 (Disclaimer of Warranty and Limitation of Liability)

  1. The Company provides the NFT features of the Service on an "AS IS" and "AS AVAILABLE" basis. The Company does not warrant that the NFT features will be uninterrupted, error-free, secure, or free from vulnerabilities.
  2. The Company shall not be liable for damages incurred by Users arising from the use of NFT features, except in cases of willful misconduct or gross negligence on the part of the Company. However, this disclaimer shall not apply if the contract between the Company and the User constitutes a consumer contract as defined in the Consumer Contract Act.
  3. Even in the cases provided in the proviso of the preceding paragraph, the Company shall not be liable for damages arising from special circumstances resulting from the Company's negligence (excluding gross negligence). Compensation for damages incurred by Users due to the Company's negligence (excluding gross negligence) shall be limited to the amount of usage fees received from the User in the month in which such damages occurred.
  4. The Company does not guarantee:
    • The listing or display of NFTs on any third-party marketplace
    • The continued availability of metadata or images associated with NFTs in the event of service discontinuation
    • Any particular outcome from the use of NFT features
  5. In the event the Company discontinues the NFT features or the entire Service, the Company shall provide at least 30 days' prior notice. NFTs already recorded on the blockchain will continue to exist independently of the Service, though metadata and images hosted by the Company may become unavailable.

Article 12 (Tax Obligations)

  1. Users are solely responsible for determining and fulfilling their tax obligations arising from NFT transactions, including but not limited to minting, selling, purchasing, and receiving royalties.
  2. Tax treatment of NFT transactions varies by jurisdiction. Users should consult a qualified tax professional regarding the tax implications of their NFT activities.
  3. The Company does not provide tax advice and makes no representations regarding the tax treatment of NFT transactions in any jurisdiction.
  4. The Company may provide transaction records upon request to assist Users with their tax reporting obligations.

Enacted on March 3, 2026