$VERTAI White Paper

00 — Table of Contents

01 — Date of Notification

2025-06-23

02 — Statement in accordance with Article 6(3) of Regulation (EU) 2023/1114

This crypto-asset white paper has not been approved by any competent authority in any Member State of the European Union. The person seeking admission to trading of the crypto-asset is solely responsible for the content of this crypto-asset white paper.

03 — Compliance statement in accordance with Article 6(2) of Regulation (EU) 2023/1114

This crypto-asset white paper complies with Title II of Regulation (EU) 2023/1114 and, to the best of the knowledge of the management body of the offeror, does not mislead and the crypto-asset white paper makes no omission likely to affect its import.

04 — Statements in accordance with Article 6(3), second paragraph, of Regulation (EU) 2023/1114

The crypto-asset referred to in this white paper may lose its value in part or in full; may not always be transferable and may not be liquid.

05 — Statement in accordance with Article 6(3), points (a) and (d) of Regulation (EU) 2023/1114

The utility token referred to in this white paper may not be exchanged against the good or service promised in the crypto-asset white paper, possibly in the case of a failure or non-continuation of the offering.

06 — Statements in accordance with Article 6(3), points (b), (c), (d) and (e) of Regulation (EU) 2023/1114

The crypto-asset referred to in this white paper is not covered by the investor compensation schemes under Directive 97/9/EC of the European Parliament and of the Council.

The crypto-asset referred to in this white paper is not covered by the deposit guarantee schemes under Directive 2014/49/EU of the European Parliament and of the Council.

Summary

07 — Warning in accordance with Article 6(7), second paragraph of Regulation (EU) 2023/1114

Warning

This summary should be read as an introduction to the crypto-asset white paper.

The prospective holder should base any decision to purchase this crypto-asset on the content of the crypto-asset white paper as a whole and not on the summary alone.

The offer to the public of this crypto-asset does not constitute an offer or solicitation to purchase financial instruments and any such offer or solicitation can be made only by means of a prospectus or offering circular under Union or national law.

The crypto-asset white paper does not constitute a prospectus as referred to in Regulation (EU) 2017/1129 of the European Council or any other offer document pursuant to Union or national law.

08 — Characteristics of the crypto-asset

$VERTAI is a crypto-asset other than an asset-referenced token or e-money token under the Markets in Crypto-Assets Regulation (MiCAR). $VERTAI is only intended to provide access to digital marketplace functionality as provided by Vertical Studio B.V. As such, it classifies as a utility token within the meaning of MiCAR.

$VERTAI is a fungible ERC-20 token issued on the Ethereum blockchain. It follows the standard Ethereum token specification, making it compatible with most Ethereum wallets, exchanges, and smart contracts. The token is divisible up to 18 decimals and has a fixed maximum supply.

$VERTAI holders can exercise their rights by creating an account at www.verticalstudio.ai, accepting applicable terms and conditions.

$VERTAI is not intended for investment purposes and includes no features such as company shares, governance rights, rights to interest or yield.

09 — Quality and quantity of goods and services

$VERTAI can be used to purchase platform credits, to be used in the Vertical AI platform, with a 10% discount. The token amount required is calculated based on the real-time USD value of $VERTAI at the time of the transaction. $VERTAI can also be staked to earn platform credits. Staking involves depositing tokens into a smart contract, where they remain locked for a set period. In return, users receive rewards in the form of additional platform credits. Users can also participate in an affiliate program to help the Vertical AI platform grow. Affiliates earn a commission based on the revenue they generate, with the potential to unlock higher commission tiers by locking a minimum amount of $VERTAI.

10 — Key information about the admission to trading

Vertical Studio B.V. seeks admission to trading for its $VERTAI token in the European Union. In addition to its current listing on Uniswap, $VERTAI may also be admitted to trading on other trading venues (inside the European Union). An updated list is available through the company website.

It is envisaged that $VERTAI will be submitted to trading at MiCAR-compliant centralized trading venues in the European Union. $VERTAI may also be admitted to trading on other trading venues (outside the European Union). An updated list is available through the company website.

There is no placement agreement in place with a crypto-asset service provider offering placement services.

Prospective holders are individuals and companies looking for cost-effective access to the services provided by the Vertical AI platform as described above.

Total token supply: 100,000,000 $VERTAI, of which 75% is already in circulation and 25% is retained by Vertical Studio B.V. Vertical Studio B.V. intends to hold these holdings over time in support of its operations. A future offer to the public of $VERTAI is currently not envisaged.

Part A — Information about the offeror or the person seeking admission to trading

A.12 — Members of the Management Body

Vertical Studio B.V. is managed by Pygg B.V. Pygg B.V. is a limited liability company incorporated under the laws of Curaçao. Pygg B.V. is a trust service provider licensed and regulated by the Central Bank of Curaçao and Sint Maarten.

Mr. M.S. Temaeten is the initiator of the $VERTAI project and majority shareholder and effectively directs the business of Vertical Studio B.V. As such he is also part of the management body within the meaning of the Markets in Crypto-Assets Regulation (MiCAR).

Pygg B.V.
Function: Sole Director
Business Address: 36 Julianaplein, Willemstad, Curaçao
In function since: 2024-12-10

Mr. M.S. Temaeten
Function: Acting CEO
Business Address: 36 Julianaplein, Willemstad, Curaçao
In function since: 2024-12-10

A.13 — Business Activity

Principal Activities: Vertical Studio B.V. is an early-stage tech startup operating in the rapidly growing AI, Cloud Services and No-Code markets. The company is developing a platform that aims to make AI models accessible to both individuals and businesses at a pay-per-use basis. Its core services include:

• a digital marketplace where users can access and utilize AI models, catering to both individuals and businesses;
• a no-code AI studio that allows users to customize and fine-tune AI models without needing programming skills, making advanced AI more user-accessible; and
• a cloud service that provides cost-effective computing power for AI fine-tuning and hosting, supporting AI developers and businesses with scalable infrastructure.

All these products and services are still under development, with no guarantee of success. At the moment of notification of this white paper, only beta versions of certain functionalities are live while there are no paying users.

Principal Markets: Vertical Studio B.V. operates in a global market, targeting both individual AI enthusiasts and businesses. The company aims to bridge the gap between complex AI development and everyday users, making AI adoption easier and more efficient across various industries.

A.14 — Parent Company Business Activity

Vertical AI Holding B.V. is a personal holding company (Besloten vennootschap) incorporated under the laws of Curaçao. As the personal holding company of Mr. M.S. Temaeten, all its directors are all ultimate beneficial owners.

A.15 — Newly Established

No

A.16 — Financial condition for the past three years

Not applicable

A.17 — Financial situation of the offeror

Vertical Studio B.V. is an early-stage technology startup. Its financial condition since registration is characterized by the following highlights:

• Vertical Studio B.V. was incorporated on 10 December 2024. Its initial book year runs to 31 December 2025. Therefore, no financial statements are available.
• Between 01/06/2024 and 01/06/2025, Vertical Studio B.V. secured approximately €4 million.
• A 4% token swap tax was implemented on secondary sales in the form of a transaction fee on the secondary market. This tax has since been removed (June 2025).
• The revenues from the token taxes (approximately €0.5 million in total across all channels) are used to cover operating expenses, including research and development (R&D), legal & compliance costs, and human capital.
• Up till June 2025, total operating expenses amounted to approximately €1.6 million.
• Despite revenue generation, Vertical Studio B.V. expects to maintain a negative cash flow as it scales up operations and commits to growing revenue from its product offerings.
• At the date of notification of the White Paper, Vertical Studio B.V. has 25 million $VERTAI on balance sheet.

Non-financial performance indicators (per June 2025):

• 24,000 registered platform users
• 12,000+ registered AI models
• 91,000+ monthly prompts sent
• 40 AI models live
• 12,000+ token holders

Part B — Information about the issuer, if different from the offeror (not applicable)

B.1 — Issuer different from offeror or person seeking admission to trading: No

Part C — Information about the operator of the trading platform (not applicable)

Not applicable

Part D — Information about the crypto-asset project

D.4 — Crypto-asset project description

Vertical AI is a platform that democratizes access to advanced artificial intelligence by enabling users to customize, deploy, and monetize AI models — without writing a single line of code. The ecosystem includes:

• Vertical Studio — a no-code AI development environment for AI customization and deploying models.
• Vertical Stream — a marketplace where users can buy and sell AI models.
• Vertical Cloud — a cloud orchestration layer that intelligently allocates workloads across centralized and decentralized compute networks, reducing costs and latency.

Together, these components aim to make advanced AI more accessible, usable, and monetizable for a broad audience.

$VERTAI holders can:

• purchase platform credits at a discounted rate using $VERTAI; and
• stake their tokens to receive platform credits.

Platform credits can only be used on the Vertical AI platform, are non-transferable and have an expiry date, as further set out in the terms and conditions. In addition, $VERTAI holders are eligible to participate in the Vertical AI affiliate program.

Target Audience: Vertical AI is designed for:

• Individuals and companies looking to use AI models at a pay-per-use basis;
• AI builders looking to train and deploy AI models easily;
• Enterprises seeking scalable, cost-efficient AI infrastructure; and
• Crypto-native users engaging with the platform through token-based incentives.

Strategic Collaborations: Vertical AI partners with decentralized compute networks to deliver flexible and cost-effective access to GPU infrastructure, ensuring broad accessibility and availability.

D.5 — Details of natural or legal persons involved in the implementation of the crypto-asset project

The Vertical AI project is led by initiator Mansuk Temaeten and his team at Vertical Studio B.V.

At the date of notification of this White Paper, implementation of the project is to be supported by the following professional service providers:

• Pygg B.V. — Role: Statutory Director (Trust Service Provider); Business Address: 36 Julianaplein, Willemstad, Curaçao
• De Roos Coöperatief U.A. — Role: Legal advisory; Business Address: Hamerstraat 19-1, 1021 JT Amsterdam, Netherlands
• NC Audit & Advisory B.V. (Baker Tilly) — Role: Audit and accounting services; Business Address: 30 Snipweg, Willemstad, Curaçao
• HBN Law & Tax B.V. — Role: Tax advisory; Business Address: Leonard B. Smithplein 3, Willemstad, Curaçao
• Tokenomics.net (Monibound Consulting) — Role: Token economics advisory; Business Address: 333 Wacker Drive, Chicago, IL 60606, U.S.A.

D.6 — Utility Token Classification

True — The crypto-asset qualifies as a utility token.

D.7 — Key features of the crypto-asset project

Vertical Studio B.V. offers a set of AI development and monetization tools, accessible through a credit-based payment system. Credits are required to use core services across:

• Vertical Studio — a no-code platform for customizing and deploying AI models.
• Vertical Stream — a marketplace to buy and sell customized models.
• Vertical Cloud — a hybrid cloud orchestration layer optimizing compute usage across networks.

Credits can be acquired using fiat (USD) or $VERTAI.

1. Purchasing Credits at a Discounted Rate

When users purchase credits using $VERTAI instead of government-issued currency (fiat) they receive a 10% discount at checkout — making token usage a more cost-effective option. The token amount required is calculated based on the real-time USD value of $VERTAI at the time of the transaction. Once purchased, credits maintain their USD-equivalent value within the platform and are consumed as users access services.

2. Staking $VERTAI for Platform Credits

Users can stake $VERTAI to earn platform credits. Staking involves depositing tokens into a smart contract, where they remain locked for a set period. In return, users receive rewards in the form of additional platform credits. The staked tokens are not consumed but remain locked until the staking period ends or is cancelled (depending on contract settings). All staked tokens are held via smart contracts to ensure transparency and proof of reserves.

Platform credits are non-transferable and can only be used within the Vertical AI ecosystem to access Vertical AI products and services. These credits cannot be traded, withdrawn, or exchanged for any external value.

In addition to the above utilities, $VERTAI token holders are eligible to participate in the affiliate program of Vertical Studio B.V. The affiliate program rewards partners who attract new users to the platform with share-based incentives. Partners who attract new users to the platform benefit from earning revenue from their referrals (with the potential to unlock higher commission tiers by locking a minimum amount of $VERTAI). Payouts of the affiliate program take place monthly (with a USD 20 threshold to minimise on-chain gas costs). Separate terms and conditions apply to participation in the affiliate program, which are available on the company website.

Vertical Studio B.V. is a start-up. At the time of notification of the White Paper certain envisaged functionalities are already live in beta (test) mode. Additional features are under active development. It is expected that the optionality to purchase platform credits with $VERTAI will go live in 2025. $VERTAI staking and the affiliate program are envisaged to go live later, potentially in 2026.

D.8 — Plans for the token

Milestones:

Initiative Phase 1

• Start development of the business model and related platform
• Establish foundational partnerships with technology providers

Initiative Phase 2

• Form strategic partnerships to support the $VERTAI token launch
• Community building and content creation on social platforms
• Infrastructure setup and blockchain network selection

Initiative Phase 3

• Incorporation in Curaçao
• Token launch on selected marketplace
• Token Generation Event (12 November 2024). $VERTAI token minted, distributed to strategic pre-sale investors, and made available to the public

Implementation Phase 1

• Tech product development (Studio, Stream, Cloud)
• Ramp up marketing and community engagement through marketing & Web3 sessions
• Platform referral program launch

Implementation Phase 2

• Official platform UI live
• Strengthen community engagement through bounties, events, and Q&A sessions
• Beta showcase showcasing models built on Vertical

Implementation Phase 3 (current phase at moment of notification White Paper)

• Vertical Stream — Community marketplace
• Creator SDKs
• Multi-model marketplace support

Implementation Phase 4

• Platform credit purchases using $VERTAI
• Establish strategic partnerships with AI and blockchain market leaders
• CEX listing

Implementation Phase 5

• Revenue Phase 2 live
• Strengthen community engagement through bounties, events, and Q&A sessions
• Beta showcase for Vertical Cloud

Implementation Phase 6

• On-platform marketing tools for creators available
• Promote Vertical AI at Web3 conferences with the core Vertical team

D.9 — Resource Allocation

Financial resource allocation up to notification of the White Paper:

• Concept development: €500K
• R&D (Development of the Vertical Stream, Studio and Cloud): €551K
• Marketing: €473K
• Other: €76K

D.10 — Planned Use of Collected Funds or Crypto-Assets

A. History of collected funds

Vertical Studio B.V. has collected funds in the form of seed funding from strategic investors, as well as crypto-assets in the form of transaction fees.

B. Token Allocation Breakdown

Vertical Studio B.V. transferred 50% of the initial token supply to a Uniswap liquidity pool at TGE. The remaining token supply has been allocated to team incentives, 25% is retained to cover future operating expenses related to marketing and listings (15%) and research & development (10%). If changing business conditions require a different distribution, Vertical Studio B.V. may reallocate allocation of retained $VERTAI based on evolving needs.

C. Planned use of funds

The below allocation indicates how Vertical Studio B.V. envisages to initially utilize the collected funds. If changing business conditions require a different distribution, Vertical Studio B.V. may reallocate funds based on evolving needs.

Part E — Information about the offer to the public of crypto-assets or their admission to trading

E.18 — Offer Phases

Strategic pre-public sale: Between July and September 2024, 20,000,000 $VERTAI tokens (out of 100,000,000 $VERTAI total supply) were sold to 35 strategic investors for a total of USD 101,000. The distribution followed a structured vesting schedule:

• 40% unlocked at the Token Generation Event (TGE) on 12 November 2024.
• 60% linear vesting over 70 days.

Phase 2: Token Generation Event (TGE): At TGE, $VERTAI was officially launched. Vertical Studio B.V. transferred 50,000,000 $VERTAI and 10 ETH to a Uniswap liquidity pool to enable the public to trade $VERTAI against ETH based on a free market mechanism. The Uniswap pool launched at a ca. USD 60,000 valuation on a fully diluted basis.

E.19 — Early Purchase Discount

Investors participating in the strategic pre-sale paid a higher price than investors that traded against the Uniswap liquidity pool at TGE. $VERTAI tokens were sold to 35 strategic investors for USD 101,000 (avg. ~2,857 per person), i.e. a ca. USD 500,000 valuation. At TGE, $VERTAI was available for trading in a Uniswap liquidity pool against a ca. USD 60K valuation.

E.33 — Trading Platforms

European Union (EU): At the date of notification, Vertical Studio B.V. is in negotiations around the admission to trading of $VERTAI in the EU. An up-to-date list of centralized trading venues where $VERTAI is admitted to trading can be found on the company website.

Non-EU: $VERTAI is listed on decentralized exchange (DEX) Uniswap. At the date of notification of this White Paper, Vertical Studio B.V. is negotiating the admission to trading of the $VERTAI token at additional venues.

E.35 — Trading Platform Access

CEX: Centralized trading venues have their own acceptance criteria and onboarding procedure, outside of the control of Vertical Studio B.V. Please refer to such CEX for more information.

DEX (Uniswap): Uniswap can be reached at: app.uniswap.org. Access to DEXs like Uniswap is open to any user with a compatible Web3 wallet.

E.36 — Involved Costs

CEX: Centralized trading venues may charge costs, such as transaction fees, in accordance with the rules of their platform.

DEX: On-chain transactions incur transaction fees on the respective blockchains. These fees are determined by the current network conditions and are standard for transactions on the relevant networks. Vertical Studio B.V. does not impose any extra purchase or subscription fees.

E.38 — Conflicts of Interest

Team Token Allocation: The core team members at Vertical Studio B.V. hold token allocations, which may create alignment but also potential conflicts of interest if personal interests diverge from those of Vertical Studio B.V., other team members, or other stakeholders.

Key Opinion Leaders: A total of 33 Key Opinion Leaders (KOLs) were engaged by Vertical Studio B.V. They purchased tokens at a discount in exchange for promoting the project. KOLs are subject to a vesting schedule. Additionally, the KOLs have signed agreements prohibiting irresponsible sale of holdings of $VERTAI at once (dumping).

E.39 — Applicable Law

The law applicable to $VERTAI is the law of Curaçao. If a participant in the offer qualifies as a consumer within the meaning of Article 6 of Regulation (EC) No 593/2008 (Rome I), the consumer will retain the protections afforded to them by provisions that cannot be derogated from by agreement by virtue of the law which, in the absence of choice, would have been applicable. By virtue of Article 17 of Regulation (EU) 1215/2012, the jurisdiction rules set out in Articles 18 and 19 of such Regulation shall apply.

E.40 — Competent Court

The competent court for any disputes related to $VERTAI is the court of Curaçao. If a participant qualifies as a consumer within the meaning of the applicable regulations, the jurisdiction rules set out in Articles 18 and 19 of Regulation (EU) 1215/2012 shall apply.

Part F — Information about the crypto-assets

Part G — Information on the rights and obligations attached to crypto-assets

G.1 — Purchaser Rights and Obligations

Rights: $VERTAI holders, subject to accepting the applicable terms and conditions available on the Vertical AI Platform, have the right to:

• obtain platform credits at a discount by paying with $VERTAI;
• obtain platform credits by staking $VERTAI;
• participate in the Vertical AI affiliate program.

$VERTAI holders do not have any ownership or equity interest in Vertical Studio B.V. or its affiliated entities. $VERTAI holders do not have any governance rights related to Vertical Studio B.V. or its affiliated entities.

Obligations: Holders of $VERTAI have the following obligations and by holding $VERTAI they represent that:

• they will hold and use $VERTAI in compliance with this white paper and applicable laws and regulations;
• they are not a restricted person, appearing on the OFAC, UN, EU or Dutch Sanction Lists and are not holding $VERTAI on behalf of a restricted person;
• they will not hold, store, transfer or deliver, either directly or indirectly, $VERTAI at any time within the United States;
• they are not acquiring $VERTAI tokens for speculative purposes or with the expectation of profit;
• they acknowledge the risks associated with crypto-asset ownership, including volatility, loss of value, and technological failures;
• Responsibility for transactions: purchasers are solely responsible for managing their crypto assets. $VERTAI transactions are irreversible. Once a holder transfers $VERTAI to a specific address, they accept ownership of such transfer. Vertical Studio B.V. has no obligation to track, recover or replace $VERTAI.

G.2 — Exercise of Rights

Purchase platform credits at a 10% discount:

1. Create an account on verticalstudio.ai and accept the applicable terms and conditions.
2. Choose $VERTAI as your payment method.
3. Confirm the transaction. The amount of $VERTAI required will be calculated based on the real-time exchange rate.
4. Upon completion of the transaction, the credits will be available in your account and can be used immediately across the Vertical platform.

Stake $VERTAI to receive credits:

1. Create an account on verticalstudio.ai and accept the applicable terms and conditions.
2. Choose the amount of $VERTAI you want to stake and the desired lock-up period.
3. Confirm the transaction to deposit your tokens into the staking smart contract.
4. You will receive platform credits on a monthly basis.
5. The staking reward can vary and will be set when the tokens are locked in the staking contract.
6. $VERTAI can be unstaked once the staking period ends and your tokens can be withdrawn. Staked tokens can be unstaked at any time before the end of the staking period; however, doing so may result in reduced or forfeited rewards.

Affiliate program:

1. Create an account on verticalstudio.ai and accept the terms and conditions.
2. Navigate to the affiliate dashboard in your Vertical AI account.
3. Generate your unique referral link.
4. Earn a commission based on the total spending of referred users over their first two years.
5. Commissions are paid in $VERTAI (with a USD 20 minimum transaction limit, to minimize transaction costs).

Platform credits are non-transferable and can only be used on the Vertical AI platform. Platform credits cannot be transferred to other users or third parties.

G.3 — Conditions for modifications of rights and obligations

Vertical AI reserves the right to amend the rights and obligations attached to the $VERTAI token from time to time. Such amendments may, for example, be necessary due to regulatory changes, technological updates, organizational decisions, or ecosystem growth. Token holders will be informed of any modifications through updates to the Vertical AI white paper, published on the official website, or through other appropriate communication channels. In case of significant new factors, material mistakes, or material inaccuracies an updated version of this white paper will be published on the official website.

G.11 — Crypto-asset Transfer Restrictions

$VERTAI is an ERC-20 token. Vertical Studio B.V. did not implement technical restrictions to the transferability of $VERTAI tokens. The transferability of $VERTAI tokens may be restricted in certain jurisdictions due to local laws and regulations. Purchasers are responsible for ensuring compliance with local regulations. 5% of $VERTAI tokens have been allocated to team members. These tokens are subject to a linear vesting period ending 1 January 2026. Additionally, the aforementioned Key Opinion Leaders (KOLs) that promoted Vertical Studio B.V. are subject to a vesting schedule to promote responsible selling.

G.12–G.13 — Supply Adjustment

G.12: No protocols are in place for automatically increasing or decreasing supply.

G.13: The $VERTAI token does not have a protocol for automatically increasing or decreasing its supply in response to market demand. The total supply of $VERTAI is fixed at 100,000,000 tokens. However, Vertical Studio B.V. may, at its sole discretion, decide to manually burn $VERTAI tokens to gradually reduce supply over time. The following burning mechanism is envisaged:

• Vertical Studio B.V. holds 25% of the total token supply on its balance sheet, at the date of publication of this white paper, and is expecting to receive $VERTAI on an ongoing basis from users purchasing platform credits once the paid version of the Vertical AI platform goes live.
• Each quarter Vertical Studio B.V. will burn a number of $VERTAI tokens equivalent to 10% of the net profit generated from services paid with $VERTAI over the previous quarter. This will be implemented through a specific process where the $VERTAI tokens are sent to a burn address, with the aim of achieving a deflationary effect by reducing the total supply of $VERTAI in circulation.
• Vertical Studio B.V. will continue to burn $VERTAI each quarter (assuming sufficient $VERTAI in holdings and positive earnings). $VERTAI token holders will be updated on the burning mechanism, including material changes thereto via the website.

G.18 — Applicable Law

The $VERTAI token and the Vertical AI platform are subject to the applicable law of Curaçao. If an investor qualifies as a consumer within the meaning of Article 6 of Regulation (EC) No 593/2008 (Rome I), the consumer will retain the protections afforded to them by provisions that cannot be derogated from by agreement.

G.19 — Competent Court

The competent court for any disputes related to the legal status, rights, and obligations associated with $VERTAI is the court of Curaçao. For consumers within the meaning of applicable regulations, the jurisdiction rules set out in Articles 18 and 19 of Regulation (EU) 1215/2012 shall apply.

Part H — Information on the underlying technology

H.1 — Distributed Ledger Technology

The $VERTAI token is built on the Ethereum blockchain, utilizing the ERC-20 token standard. Key advantages of Ethereum include its smart contract functionality, which automates processes such as token transfers and conditional execution. Ethereum's ecosystem offers compatible wallets and decentralized applications. Ethereum's established infrastructure provides a reliable foundation for the $VERTAI token, supporting long-term operation and integration within the Vertical AI ecosystem.

H.2 — Protocols and Technical Standards

1. Blockchain Protocol: The token operates on the Ethereum blockchain, which is a decentralized, open-source blockchain platform with widespread adoption.
2. Token Standard: The token follows the ERC-20 standard, which is the most widely used technical standard for fungible tokens on the Ethereum blockchain.
3. Smart Contract Standards: The $VERTAI token's smart contract adheres to the ERC-20 standard, which defines a set of functions (e.g., transfer, approve, balanceOf) that enable seamless interaction with other Ethereum-based tokens.
4. Interoperability: By adhering to the ERC-20 standard, the $VERTAI token is interoperable with a wide range of Ethereum-based tools, including wallets (e.g., MetaMask), decentralized exchanges (e.g., Uniswap), and other decentralized applications.
5. Security: The smart contract leverages Ethereum's cryptographic protocols and decentralized validation to ensure secure and tamper-proof transactions. The use of established standards like the ERC-20 minimizes the risk of vulnerabilities and ensures compatibility with industry best practices.

H.3 — Technology Used

$VERTAI is an ERC-20 token that runs on the Ethereum blockchain for secure receiving, holding and transferring $VERTAI tokens.

H.4 — Consensus Mechanism

The Ethereum blockchain uses a Proof of Stake (PoS) consensus mechanism. In PoS, validators are selected to create and validate new blocks based on the amount of cryptocurrency they have staked. Validators are economically incentivized to act honestly, as misbehavior can result in the loss of their staked funds. This mechanism ensures efficiency, security, and scalability, providing a reliable foundation for $VERTAI transactions.

H.5 — Incentive Mechanisms and Applicable Fees

Incentive Mechanisms: The Ethereum blockchain, on which $VERTAI operates, uses a Proof of Stake (PoS) consensus mechanism. Validators are incentivized to secure transactions by earning rewards for validating blocks. These rewards are funded through transaction fees and newly minted ETH (staking rewards).

Ethereum Applicable Fees (Gas Fees): Users pay Ethereum gas fees for transferring $VERTAI tokens. These fees compensate validators for processing transactions and securing the network. Vertical Studio B.V. does not charge transaction fees.

H.6 — Use of own Distributed Ledger Technology

No — DLT that is operated by the issuer, the offeror, or a third party acting on their behalf is not used.

H.8 — Audit

Yes — an audit of the technology used was conducted.

H.9 — Audit Outcome

The technology used for the $VERTAI token underwent a security audit on 12/11/2024 conducted by SolidProof.io, a blockchain technology audit firm, to assess the integrity and robustness of the smart contract.

A. Scope of the Audit:

1. Specification Review: examination of the smart contract's intended functionality, including a review of provided specifications and implementation.
2. Manual Code Examination: line-by-line inspection of the smart contract's source code to identify potential security risks and areas for optimization.
3. Functional Testing: Validation that the smart contract's functionality aligns with the intended design.
4. Test Coverage Assessment: Evaluation of test cases to ensure comprehensive coverage and identify any gaps.
5. Symbolic Execution: Analysis of execution paths to identify edge cases or potential issues.
6. Best Practices Evaluation: Assessment of compliance with security standards and industry best practices.
7. Actionable Recommendations: Identification of potential optimizations and enhancements. As the audit did not identify material risks, Vertical Studio B.V. decided not to prioritize action on the recommendations.

B. Key Findings and Outcome:

The audit report concluded that no critical or high-severity issues were found within the $VERTAI smart contract. The key observations are as follows:

1. Security Findings:
   • No high or medium severity vulnerabilities detected.
   • One low-severity issue was identified in relation to a token utility that has since been removed.
   • No vulnerabilities found that allow minting, blacklisting, or locking of user funds.
   • The contract is upgradeable, which introduces potential risks if not properly managed.
2. Ownership and Control:
   • The contract is not renounced, meaning administrative control remains with the project.
   • The owner cannot arbitrarily mint tokens, set excessive fees, or blacklist users, ensuring security against abusive controls.
3. Performance and Reliability:
   • The audit confirmed that the contract aligns with Solidity best practices.
   • No performance concerns were highlighted in the audit.
4. Open Source and Bug Bounty Program:
   • The contract source code is available on Etherscan, providing for public scrutiny.
   • Currently, no public bug bounty program is in place, but future security initiatives may include such programs.

C. Audit Report Accessibility: The full audit results, including a detailed breakdown of findings, can be accessed at: https://app.solidproof.io/projects/vertical-ai

Part I — Information on risks

I.1 — General Risks

Vertical Studio B.V. publishes this white paper in relation to the admission to trading of the $VERTAI token on a regulated European trading venue. Vertical Studio B.V. is a start-up developing a platform for artificial intelligence services with many risks. Vertical Studio B.V. identified the below risks as most material and most likely to occur given the current stage of development. Additional risks may also materialize as unanticipated variations or combinations of the risks described within this section.

Regulatory compliance risks: Crypto-assets and the markets in crypto-assets are relatively new and subject to many uncertainties. Changes in regulatory requirements can result in legal penalties, fines, and potential market bans. Legal uncertainty around the treatment and classification of crypto-assets in many jurisdictions may impact investor appetite in the project, which may negatively impact the value of $VERTAI as well as the possibility to trade $VERTAI. At the same time, regulation of artificial intelligence (AI) is still evolving. Legal and regulatory limitations to the use of AI can impact the business model of Vertical Studio B.V., which in turn can impact the utility and therefore value of $VERTAI.

Vertical AI project risks: $VERTAI is a utility token which can be used on the Vertical AI platform. As such, the value of $VERTAI is fully related to the success or failure of the Vertical AI project. The Vertical AI project is in development, based on nascent technology and an innovative business case. There is no guarantee of success — if the Vertical AI project fails, $VERTAI will lose its utility and therefore likely also its value.

Nascent start-up related risks: Vertical Studio B.V. is an early stage start-up. Typical start-up related risks apply, such as those related to a limited operational history, unproven business model, and potential challenges in scaling operations. Start-ups face higher failure rates, and any inability of Vertical Studio B.V. to execute its business plan, secure additional funding, or achieve milestones could adversely impact the utility of $VERTAI and its value.

Risks related to the financial situation of Vertical Studio B.V.: The Vertical AI platform is still under development and has not generated profits. Vertical Studio B.V. is dependent on its cash reserves and potentially external financing. If Vertical Studio B.V. runs out of cash, it is likely to fail as a result of which $VERTAI would lose its utility and therefore value.

Market volatility: Crypto-assets are notoriously volatile. $VERTAI may be subject to extreme price volatility, which can lead to significant financial losses for investors. The market value of $VERTAI is based on supply and demand, whereby demand is driven by the use of the token on the Vertical AI platform and the supply is limited to the total supply of $VERTAI.

Influence on pricing: Vertical Studio B.V. holds a material portion of $VERTAI tokens, potentially being able to assert significant influence on pricing. At the date of notification of this white paper, Vertical Studio B.V. holds ca. 25% of all $VERTAI token reserves. If Vertical Studio B.V. were to sell a significant portion of $VERTAI tokens in a relatively short time frame, this could negatively impact the market value of $VERTAI.

Trading venue risk: Vertical Studio B.V. neither operates nor controls, oversees or manages the functioning of trading venues where $VERTAI is admitted to trading. Trading venues may encounter technical, financial, and other issues, including insolvency. Vertical Studio B.V. cannot guarantee that $VERTAI will remain listed or tradeable on any trading venue. Delisting could significantly hinder the liquidity of $VERTAI.

Business environment risk: AI is a fast-evolving combination of technologies with fierce competition globally. The Vertical AI platform may fall behind in terms of technology, ease of use, or other factors, threatening the platform and therefore the $VERTAI token. While Ethereum's transition to Proof of Stake reduces energy consumption, ESG concerns related to blockchain technology and AI energy consumption could still arise, negatively impacting market perception.

I.2 — Issuer-Related Risks

Crypto-assets market risks: $VERTAI may be subject to extreme price volatility, which can lead to significant financial losses for investors.

Regulatory risks: Legal frameworks related to crypto-assets vary across jurisdictions. Regulatory conflict and uncertainty may lead to risks for the project, impacting the value of $VERTAI.

Liquidity risks: If $VERTAI is not admitted to trading venues, this would materially impair the possibilities for investors to buy, sell or trade $VERTAI.

Security risks: Crypto-assets are susceptible to hacking, fraud, and other cyber threats, potentially resulting in the loss of funds or sensitive information.

Demand risk: If the popularity of the Vertical AI project decreases, a decrease in demand for $VERTAI may be expected, and its value may drop to zero.

Dependence on Ethereum network: As $VERTAI operates on the Ethereum blockchain, its performance and costs are directly influenced by Ethereum's network conditions. High gas fees, congestion, or fundamental issues with Ethereum could impact $VERTAI transactions.

Counterparty risks: $VERTAI's interoperability with Ethereum-compatible wallets and decentralized applications makes it vulnerable to failures or breaches of such third parties.

Adoption risks: If the broader adoption of AI, decentralized technologies, or related services slows down, the demand for Vertical AI and $VERTAI might be adversely affected.

Legal and regulatory risks: $VERTAI is subject to crypto-asset regulations in various jurisdictions. Legal uncertainty or unfavorable regulatory treatment could impact its legal status and compliance requirements.

Environmental, social, and governance (ESG) risks: Vertical Studio B.V. could face scrutiny regarding ESG practices in the future, including energy consumption.

I.5 — Project Implementation-Related Risks

Reputational risks: Mismanagement or issues with $VERTAI can damage the company's reputation, resulting in lower adoption and difficulties to attract funding.

Technology risks: Vertical Studio B.V. is heavily reliant on technology. It uses blockchain technology for its crypto-asset and develops a platform for AI applications, including decentralized cloud computing. There is a risk of technological failures and disruptions. Moreover, Vertical Studio B.V. is highly dependent on third parties for the functioning of its solutions.

Adoption risks: Platform business cases require mass adoption to become profitable. Vertical Studio B.V. requires a large number of frequent users to become profitable and maintain operations. There is a material risk that the Vertical AI project does not achieve broad market acceptance or sufficient demand.

Internal control risks: As a start-up, Vertical Studio B.V. is still highly dependent on its founder team. The loss of key personnel could materially disrupt operations. In particular, the Vertical AI project is highly dependent on the services of founder Mr. Temaeten.

Funding risks: Vertical Studio B.V. may attract insufficient funding to realize implementation. The Vertical AI project may run out of resources before becoming profitable.

Financial risks: Vertical Studio B.V.'s ability to cover operational expenses partly depends on the market value of $VERTAI, as the company intends to sell part of its retained $VERTAI to cover costs. Volatility in token markets or poor conversion timing may reduce the available operating budget.

Governance risks: Vertical Studio B.V. is a start-up with a relatively young and inexperienced team. This imposes additional risks of ineffective decision-making processes or other forms of mismanagement.

Partnership dependency risks: The Vertical AI project relies on strategic partnerships and service providers. Service providers or partners could disrupt project progress. For example, LLM providers such as OpenAI, LLaMA, or DeepSeek could limit or prevent Vertical Studio B.V. from accessing their services.

Security risks: Tokens and the platforms on which they are traded can be vulnerable to hacking, fraud, and other security breaches, leading to potential loss of assets.

Technical failures: Infrastructure or software failures, including outages or bugs, can disrupt the functioning of the Vertical AI platform.

Innovation pace: Rapid technological advancements may render current solutions obsolete or less competitive, necessitating ongoing updates and potentially significant investments in R&D.

Third-party dependency risks: Dependence on external infrastructure (such as oracles, APIs, or external smart contracts) could be outside the control of Vertical Studio B.V.

Unforeseen risks: Future updates to Ethereum or the Vertical AI platform may introduce unexpected issues, incompatibilities, or downtime.

I.7 — Mitigation Measures

Security and cyber risk: The deployed smart contract has undergone external auditing to identify vulnerabilities. Vertical Studio's core systems use TLS encryption as standard. In addition, OIDC-based authentication and VPN access are being used to enhance identity security and protect internal operations.

Technology scalability and resilience: Vertical Studio B.V. maintains a modular and scalable platform architecture to enable scaling. Various components can be scaled independently or through partnerships and/or vendors. Vertical Studio B.V. partially uses technology provided by major industry players to mitigate the risk of technological failures.

Part J — Information on sustainability indicators