White paper

November, 2017
 carVertical White paper is a living document.

We are constantly upgrading our white paper to answer all your

questions and provide all information you could possibly need
before participating in our ICO and understanding carVertical
solution, products, and token.

If you miss any kind of information, please reach out to us at:

https://t.me/carVerticalio

Version 2.6.2

Updated: 2017-12-24

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1. OVERVIEW [TL;DR] 5

2. WHICH SPECIFIC PROBLEMS ARE WE ADDRESSING? 6

2.1 SCATTERED DATA 6
2.2 UNWILLINGNESS TO DISCLOSE DATA OR LIMITED AVAILABILITY OF INFORMATION 6
2.3 INTER-COUNTRY DATA LOSS OR ABSENCE OF SYNCED REGULATIONS BETWEEN COUNTRIES 7
2.4 VARIOUS NATURE OF DATA MAKES IT DIFFICULT TO DRAW CONCLUSIONS OR GET MARKET-
SPECIFIC INSIGHTS 8
2.5 UNFAIR TRADE PRACTICES DEFINED BY LAW, BUT HARDLY TRACEABLE IN TERMS OF TIMING 8
2.6 LACK OF TRUSTED SOURCE FOR VEHICLE VALUE 8

3. DEEP DIVE INTO SOLUTION 9

3.1 DATA FIRST 10
3.1.1 IOT MINERS 10
3.1.2 DATA ACCESSIBLE TO ONLY VEHICLE OWNER 11
3.1.3 TRUSTED SOURCES 12
3.2 VEHICLE VALUE 12
3.3 HISTORY REPORTS AND INSIGHTS 12

4. BUSINESS MODEL 13
4.1 CARVERTICAL.WALLET 14
4.1.2 CLOSED INFORMATION ACCESS CONTROL 15
4.1.3 CLAIMING VEHICLE 15
4.1.4 MARKETPLACE 16
4.1.5 NOTIFICATIONS 16
4.1.6 PUBLIC DATA AND DATA EXCHANGE 17
4.2 CARVERTICAL.REPORTS 17
4.3 CARVERTICAL.WHITELABEL 18
4.4 CARVERTICAL.API 20

5. BUSINESS ANALYSIS 21
5.1 MILESTONES & HIGHLIGHTS 21
5.2 CASHFLOW ANALYSIS 22
5.3 NOTES ON PRODUCT PRICING 22
5.4 SWOT ANALYSIS 23

6. TOKEN SALE & TOKEN MODEL 25

6.1 THE PURPOSE OF CARVERTICAL TOKEN 25
6.2 HOW IS TOKEN GOING TO BE USED IN CARVERTICAL? 26
6.3 RULES OF ICO 28
6.4 WHAT IS KYC AND WHY IS IT NEEDED? 31
6.5 PRIVACY AND SECURITY DURING KYC 32
6.6 REGISTRATION FOR ICO 34
6.7 TOKEN SALE 35
6.8 ARE CARVERTICAL TOKENS SECURITIES? 38

7. INDUSTRY TRENDS 39

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8. THE TEAM 40

9. PRODUCT DEVELOPMENT TIMELINE 47

10. FOR CONTRIBUTORS 48

6 SUBJECTIVE ARGUMENTS PROVING WHY CARVERTICAL TOKEN VALUEIS GOING TO GROW IN THE
FUTURE 48

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1. Overview [TL;DR]
● Automotive market is growing. Aftermarket is growing to an even larger
extent.
● Used vehicles change multiple owners and multiple countries. Real
vehicle history does not exist, because car data does not travel as fast
as cars do.
● The lack of trusted vehicle history generates perfect ecosystem for
unfair practices, which in turn generates false vehicle value.
● Because of false value and unreliable vehicle history data, insurance
companies overcharge for taking risks, therefore consumers overpay
for it.
● Vehicles generate a large amount of data which is monetized by third
parties.
● Data is owned by its creator, hence vehicle owner is the owner of data
generated by their vehicle. However, today vehicle owner has no real
control over data the vehicle generates.
● We collect vehicle history, store it in blockchain and give back the
control to the owner of the vehicle.
● We are building tools and products for vehicles to generate more
trusted data which is then added to blockchain.
● We are creating incentive mechanisms for owners, so that they could
get value for data their vehicles generate.
● All data goes into creating a trusted, tamper-proof, and decentralized
vehicle history registry.
● By using vehicle history we are building a decentralized mechanism for
transparently calculating vehicle value.

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 ● History, reports, and value calculations will be sold to parties in need
and vehicle owners, as content creators, will be rewarded.
● This will bring transparency and trust to the used car market.

2. Which Specific Problems Are We

Addressing?
2.1 Scattered Data
Vehicle data is scattered across multiple sources and the only way to get a
whole picture about a true state of the vehicle is by gathering it piece by
piece. There are at least 7 primary car history parts:

● The accuracy of odometer readings

● Information about prior damage (as a result of various accidents)
● Maintenance records
● The number of previous owners
● The legal status of a vehicle (e.g. stolen)
● Possible ownership restrictions (e.g. liens)
● Archive photos

Each of these parts is scattered across a number of sources which, on top of

that, differ depending on country or region.

2.2 Unwillingness to Disclose Data or Limited Availability of

Information
None of the parties holding data about vehicles are willing to disclose it.
Some data is closely linked to personal data, even though all of it can be
depersonalized. Only a vehicle owner has rights to their data.

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Unfortunately, in this area, content creators have no incentives to get their
data, as they have no use for it. This is closely linked to the fact that
organizations holding automotive data do not provide tools for data owners
to collect it.

This is yet another reason for today’s multi-billion car fraud business.

2.3 Inter-country Data Loss or Absence of Synced Regulations

between Countries
Organizations within a country do not have infrastructure to share
information in real time. The situation is even worse on the inter-country
scale. Today's problems, economy, and used vehicle market are rapidly
becoming more global. Centralized organizations which hold important data
cannot catchup with the fast progress of globalization trends. As a result,
every country (and every entity within the country) has its own rules for
gathering and managing the data, and usually those rules are not aligned
among different states.

The time gap between deregistering a vehicle in one country and registering
it in another usually marks a grey area where previous accidents are hidden
and mileages are clocked.

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2.4 Various Nature of Data Makes It Difficult to Draw
Conclusions or Get Market-specific Insights
Every organization, entity, and country has different data formats. Even basic
units of length have not been unified yet (Germany has kilometers, the UK -
miles, Sweden - Swedish miles). This creates even more difficulties in
unifying vehicle history in today's global market. Getting complete
conclusions and insights is practically impossible.

2.5 Unfair Trade Practices Defined by Law, but Hardly

Traceable in Terms of Timing
There are laws protecting against these fraudulent and unfair practices. At
the same time these law enforcement agencies are being blocked by simple
lack of trusted information. Falsifying documents or tampering the odometer
can be done much more quickly than it can be detected by law enforcement.
After these falsifications, a vehicle is sold and link between the fraud and the
person who commits it is lost.

2.6 Lack of Trusted Source for Vehicle Value

Today, there is no trusted way to calculate vehicle value. Vehicles are
evaluated privately, with questionable data, and low accuracy by people who
mainly base their decisions on personal experience.

Accuracy, transparency, and trust are vitally important in this area as a lot of
expensive decisions are made according to this number.

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3. Deep Dive into solution
carVertical is blockchain-based vehicle history registry. We collect large
quantity of information from a lot of different trusted sources, organize it in
the form of records and store it in blockchain. We then feed this information
into our data analysis stack, which, by using machine learning and advanced
mathematical models, calculates the real value. Most of our elements will be
open sourced and our system will be moving to full decentralization to
preserve transparency. We will incentivize and empower users to easily
collect and get rewarded for the data they own. They are content creators.

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3.1 Data first
There are three main data source categories:

● IoT miners;
● Data accessible to only a vehicle owner;
● Trusted sources;

3.1.1 IoT miners

We are working with an industry-leading IoT device manufacturer to create
the 1st version of carVertical miner. Installing these miners into your vehicle
OBD slot will generate a stream of real time information which will be sent to
our data farm for processing. In exchange, the owner of a miner will receive
tokens as a reward.

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3.1.2 Data Accessible to Only Vehicle Owner
There is a number of data sources which can only be reached by a vehicle
owner. We are working with advisors and partners to create ways for users
to grant us access to such data in exchange for tokens. Primary sources of
such information are local registries. Data will be depersonalized, securely
stored, and encrypted. We do not need personal data. Only the data owner
will be able to unlock and grant access to such information in exchange for
tokens. This will allow user to control and receive value for their information.

Every vehicle data exchange will have to pass Ethereum smart contract to be
validated and unlocked. We are using Merkle tree with Merkle reduce list to
store final state of vehicle data in Ethereum.

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3.1.3 Trusted Sources
Most of the vehicle history records are stored in closed and private
databases. We are onboarding insurance, business fleets, state registries,
classifieds, auctions, law enforcement agencies, and workshops to open
vehicle data for vehicle owners. Such data exchange is in the best of interest
to all parties: the owners who officially hold data and businesses that need
this data to benefit. All exchanges will be done with carVertical token.

3.2 Vehicle Value

We are building a decentralized and open-sourced vehicle value calculation
service. It will use information owned by users and will provide trusted, open,
and collaborative source of true vehicle value. This is in high demand by a lot
of service providers, such as insurance companies, car mortgage providers,
leasing services, and many more. Frauds and inaccuracy are usually very
expensive for such companies, while additional price is usually overpaid by
customers.

3.3 History Reports and Insights

Our system will examine a vehicle's data, technical specifications, and other
records, and provide the history of details, insights, as well as future
predictions for the vehicle. Using these reports we are bringing trust and
transparency into today’s chaotic, unfair and, very often, fraudulent second-
hand vehicle market.

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4. Business Model
One world - one decentralized registry for all vehicles. This is an
unprecedented case. We are building a company which will allow users to
truly own, control, and benefit from the data their vehicles generate.

Our company's healthy life cycle is calculated on the soft cap of the ICO
3050 Ethereum. This amount of money could help us safely build a company
and run it for 5 years only developing products. We aim to start a revenue
flow in a few months after we close the ICO with carVertical.reports (section
4.2). Another product carVertical.WhiteLabel (section 4.3) will add income to
cash flow in 13 months after completing the ICO and carVertical.API (section
4.4) in 15 months. For detailed cash flow execution please check cash flow
analysis (5.2).

The main goal of the ICO: the hard cap of 15050 Ethereum is the most
rational budget for our company’s 5 years runway with maximized marketing
expenses. Additional budget gives us leverage to onboard databases of
more different countries earlier and start selling our products in these
countries.

Producing car’s history blockchain registry will enable our team to build four
different products which will fully utilize blockchain technology, the token of
our company, and will be the core elements of a stable cash flow.

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4.1 carVertical.Wallet
Wallet is our front product. It will serve as a gateway to most of our services.
It will directly communicate with Ethereum blockchain as well as other helper
services. It is a mobile gateway to virtually manage your car's registration
and maintenance records, perform insurance or technical inspection tasks,
access marketplace, and manage access to your data Wallet functionality:

● Closed information access control

● Claiming vehicle
● Marketplace
● Notifications

Monetization: service providers will have to pay cV Tokens to offer their

services to vehicle owners. cV Tokens will be bought with FIAT from the pool
or in exchange from other token holders.

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4.1.2 Closed Information Access Control
There is a number of record types in vehicle history. Users are able to control
who can access which records, as well as enable public access to some of
them.

4.1.3 Claiming vehicle

By claiming a vehicle, you will register it as your property. A record will be
kept in Ethereum blockchain. This will make you the owner of any data
related to that vehicle. You will receive tokens when this data will be used.

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Registration process will include verifying your identity to the public key of
your wallet. Users will have to use Civic (we will implement more identity
services later) to verify their identity (we will not be handling any personal
data). And, after that, you will have to confirm that the vehicle you are
claiming is officially registered to your name. This is done via your local
vehicle registry. We are working with advisors to create such possibility in
countries where it does not exist.

4.1.4 Marketplace
This is going to be a new way to use and manage outside services needed
to run your vehicle smoothly. Buying/renewing insurance, ordering service
checks, maintenance, and much more. Since we are going to have detailed
information about vehicle and its status, service providers will be able to
accurately target vehicles which require certain services. Targeting will cost
tokens. Vehicle owners will be able to pay using tokens they currently own
and receive discounts according to the amount of tokens they hold.
Marketplace will be built with Ardor (an evolved version of NXT) blockchain.

4.1.5 Notifications
We will be able to notify users about the number of events which our
Machine Learning will derive from the data:
● Insurance renewal
● Tech inspection
● Vehicle issue (IoT)
● Maintenance checkup
● Recommended oil change

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 ● Seasonal tire change
● … and more, according to other parameters

4.1.6 Public data and data exchange

We would like to participate in such initiatives as IPDB [ipdb.io]. Users will be
able to mark some records as viable for public use, such as odometer
readings or minified versions of other records, as well as add integration via
Ocean protocol [oceanprotocol.com]. This would provide users with more
ways of benefiting from their data.

4.2 carVertical.reports
By utilizing this product we want to satisfy supply/demand for people who
want to buy a second-hand car and car dealers. We will provide a unified
and easy-to-read report which includes full car history and specific
information about that particular vehicle.

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More than 1.900.000 search queries about car VIN number check-up are
estimated every month. And people get access to only low quality databases
with dodgy and unreliable results, we are changing that.

Monetization: fixed price per report & bulk report offers

4.3 carVertical.WhiteLabel
We feel the need to spread and ensure easy access to this registry for as
many people as possible. Our belief is that the fastest way to do so is giving
correct tools, which will help to localize and spread access, to others. Even if
you have a good team, car history register database is quite difficult to
establish as a B2C business model and it also is time-consuming. We will
provide white label (franchise model) solution to everyone who wants to run
such business on their own.

For a monthly fee we will provide a white label buyer with:

● Website templates
● - Automatic report development system
● - CMS (content management system)
● - CRM system (customer relationship management)
● - API;
● - Payment processing

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The buyer will only need to figure out how to create marketing for their
product and selected country or region, and start earning revenue.

More than 1.300.000 people worldwide look for white label (franchise)
business opportunities every month. Creating such product as
carVertical.WhiteLabel is a great solution to satisfy this demand and give
online entrepreneurs an opportunity to start their local car VIN number
check-up business.

Monetization: fixed monthly subscription depending on quantity of reports

generated.

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4.4 carVertical.API
Big and medium size companies are always in a great need to expand their
data sources.

Such companies as insurance, leasing or claim handling services buy plenty

of database services every day to make their job easier. For big companies
more data sources in their everyday job mean lower financing loss at the end
of the year.

carVertical.API is a product for big fish. We will provide them with an API
(application programing interface) to get a really easy access to history,

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report and value calculation services. An API can be easily integrated into
their in-house systems and supported all the time from our side.

Monetization: b2b monthly fee + for a quantity of API calls.

5. Business Analysis

5.1 Milestones & Highlights

Five year milestones:

1. 3rd year cash flow positive

2. presence of carVertical.Reports business in the EU, Asia, and the USA;

3. carVertical.Wallet launched and scaling.

2018 highlights: building a database and launching carVertical.Reports in 4

European countries, 40.000 reports sold

2019 highlights: launching in 9 more European countries, introducing API

and "white label", preparing for a carVertical.Wallet, 290.000 reports sold

2020 highlights: launching carVertical.Wallet beta version, entering 10 more

markets with reports, 850,000 reports sold

2021 highlights: entering Asia, Middle East and South Africa Republic with
reports, launch of wallet in selected European markets, 1.500.000 reports
sold

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 2022 highlights: wallet scaling entering the USA, Canada, and completing
onboard of Europe with reports, 2.200.000 reports sold

5.2 Cashflow Analysis

2018 2019 2020 2021 2022

Funds needed EUR 786.000 3.360.000 4.161.000 2.306.000 2.106.000

Remaining end of the year

EUR 400.000 2.064.000 7.104.000 11.324.000 12.630.000

Marketing & Sales EUR

230.000 1.590.000 2.280.000 3.335.000 4.150.000

Operational Expenses EUR

556.000 2.170.000 3.945.000 6.075.000 9.280.000

Sales, total EUR

400.000 2.944.000 9.168.000 18.428.000 27.204.000

carVertical.Reports EUR
400.000 2.610.000 8.500.000 16.500.000 24.200.000

carVertical.API EUR
250.000 500.000 1.300.000 2.000.000

carVertical.WhiteLabel EUR
84.000 168.000 378.000 504.000

carVertical.Wallet EUR
250.000 500.000

Operating profit EUR: -386000 -1296000 2943000 9 018000 10 524000

5.3 Notes on Product Pricing

carVertical.report pricing the net price of carVertical.Reports growing from 8
to 12 EUR avg. daily sales growing up to 200.

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carVertical.API pricing the average net price of carVertical.API - 10.000
eur/year per client.

carVertical.WhiteLabel pricing the average net price of carVertical.API - 350

eur/month per client.

5.4 SWOT Analysis

Strengths
1. carVertical is a blockchain registry. This means that data cannot be
changed, faked, rewritten or manipulated.

2. carVertical is the first solution in the world which took blockchain-based

approach to the car history sector.

3. Our team has a team member who has worked in car history database
market for years.

4. Blockchain for our products automatically guarantees trust and

transparency as a unique selling proposition.

5. Three products (.reports, .WhiteLabel & .API) will guarantee a stable

cashflow for our company in a very short time after ICO.

6. Our carVertical.Wallet product will feature an integration with Civic Identity

Verification process. It is becoming an industry standard.

7. carVertical.WhiteLabel product will guarantee a faster spread of our

blockchain registry all over the world.

8. Performance team! Faster than autoDNA and more technologically

advanced than CARFAX.

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Weaknesses
1. Data gathering starts from scratch. In the case of scraped information, it
will take about 2 years for it to become valuable.

2. It will also take some time to overcome some VIN-checking services

which are well-known on the regional level.

Opportunities
1. carVertical.API product will not only guarantee possibility to approach and
sell blockchain registry to big companies, but also turn them into our data
sources.

2. From marketing perspective, it is always easier to penetrate such market

which does not want to change and innovate itself.

3. carVertical is the first blockchain-based car history solution. It means a

great potential to become an industry standard.

4. carVertical also has an opportunity to become the first global vehicle

registry.

Threats
1. carVertical most heavily relies on Ethereum, as that is where the registry
will be stored. Any threat to Ethereum is a threat to carVertical.

2. As trust in ICOs is in fast decline, we might raise money slower, which will
slow down the product development.

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3. Legislation. Some countries treat VIN as personal information. Not clear,
but EU might enforce directive that states VIN as personal information. This
might make getting and storing information more difficult as we will need to
conform to more standarts.

6. Token Sale & Token Model

In this section, we are going to summarize the process of carVertical token
model, distribution & utilization. More detailed terms and conditions will be
set out in the terms and conditions of the carVertical token sale which will be
made available on our website www.carvertical.io.

6.1 The Purpose of carVertical Token

carVertical token is NOT AN ASSET, NOR A SECURITY. It is a utility token.
carVertical tokens do not represent or confer any ownership right or stake,
share, security, or equivalent rights, or any right to receive dividends, other
payments, intellectual property rights, or any other form of participation in or
relating to the project described in this white paper and/or in carVertical or
any of its affiliates. The holders of carVertical token are only entitled to use
carVertical products as described in this document if successfully
developed, or to resell the tokens.

The cV token itself will be based on Ethereum, a blockchain-based

computing platform. Ethereum allows smart contracts – distributed
computer programs which can facilitate online contractual agreements in a
cryptographically secure manner. Smart contracts are what enables the

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existence of carVertical token as a truly transparent and decentralized
service. This technology also ensures that carVertical removes the need for
intermediaries and having a central authority you need to trust, through
smart contracts, the complex process of choosing peers, tracking delivery
and facilitating bidding/payment can be described in the contract itself, while
still running on the distributed Ethereum network and taking advantage of
the blockchain qualities.

cV are distributed and kept on the main Ethereum network. To optimize the
transaction cost and performance, all micro transactions are processed off-
chain and only the final stakes are returned to the Ethereum network. We
believe in the idea of keeping tokens on Ethereum and see it as a bank
platform, and an excellent platform to enter exchange markets.

6.2 How Is Token Going to be Used in carVertical?

The usage of a cV token described by product:

carVertical.Wallet:

A person can earn cV by using carVertical.Wallet product. The person will

earn a small amount of cV by downloading the carVertical.Wallet mobile
application, confirming their identity with Civic identity verification
blockchain, and confirming their car’s ownership with their country's national
car registry. Using wallet user will be able to provide access to his/her data
kept by third parties, which will earn additional tokens. Also, there will be

26
some referral programs for carVertical.Wallet with a small amount of cV
tokens as a reward.

Service or product providers will need to pay cV tokens (or other crypto or
FIAT currency) for a possibility provided by carVertical to make offers (e.g.
insurance offer) to the carVertical.Wallet users.

A carVertical.Wallet user will be able to buy service or products from

providers by paying a cV token (or other crypto or FIAT currency).

carVertical.Reports:

A person or a company will be able to purchase a report about a particular

car by using a cV token (or other crypto or FIAT currency).

carVertical.WhiteLabel:

A person or a company will be able to buy a carVertical.WhiteLabel solution

by using cV token (or other crypto or FIAT currency) and start their own car
VIN checkup business in their country.

carVertical.API:

A person or a company will be able to buy a carVertical.API solution by using

cV token (or other crypto or FIAT currency) access carVertical database by
provided API solution and easily integrate our data to their systems.

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cV Token graphic flow:

6.3 Rules of ICO

carVertical will launch only ONE public initial coin offering (ICO) during which
a token sale will be held. It will take place on https://www.carvertical.io. The
ICO will start on the date which will be determined soon. Contributors who
plan to purchase up to 2,5 ETH worth of cV will not be required to get
whitelisted. The hard cap of the carVertical ICO is 15050 ETH. The soft cap -
3050 ETH. The pre ICO stage is 1050 ETH.

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carVertical public token sale will be executed in 6 waves. The first wave is
considered a pre-ICO and is worth 1050 ETH. All funds contributed during
the pre-ICO wave will be used for marketing & legal expenses of the
carVertical ICO campaign.

Wave 2 (2000 ETH) is considered the soft cap (Total with Wave 1 - 3050
ETH). If the company does not reach soft cap (End of Wave 2), all
contributions will be refunded. In such case only contributors that
participated in wave 2 will get their contributions back. All pre-ICO (wave 1)
contributors will not be able to refund their donations.

All waves will be executed by ERC-20 standard and the token sale will be
distributed via smart contracts on the Ethereum Network. The smart contract
will cover all six waves including pre-ICO stage (Wave 1). The smart contract
will automatically close in 100 days after the start of first wave. carVertical
Tokens will be distributed to all contributors only after the end date of the
smart contract or if the token crowdsale reaches its hard cap (15050 ETH).

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Individual maximum purchase cap - 2000 ETH, individual minimum purchase
cap - 0,1 ETH.

Rules of ICO 30: Additionally, during the registration an intended to be used

Ethereum wallet address should be provided. It will be used for transferring
ether and receiving carVertical tokens. The address provided and beneficiary
address must be the same. One contributor will be able to make only one
transfer. The wallet must be ERC-20 approved. A list of recommended
wallets is provided below.

DO NOT PARTICIPATE IN TOKEN SALES DIRECTLY FROM

CRYPTOCURRENCY EXCHANGE ADDRESSES. YOU NEED A TOKEN
COMPATIBLE ETHEREUM WALLET.

cV will be transferred after the reach of the soft cap. When the soft cap is
reached, the cV will be transferred immediately after the transaction is made.
During the ICO, carVertical tokens will be locked, until the end of the

30
ICO. cV will be listed in exchanges in 6-16 weeks after the ICO is finished. If
not all the cV are sold during our token sale, the remaining tokens will be
shared to all ICO (43%) contributors proportionally. These tokens will be
transferred when a person makes a transaction using carVertical token. Any
transaction will be applicable, even to the same wallet. In an unlikely event, if
the soft cap is not reached, contributors will get refunded automatically
(except wave 1 - soft cap).

6.4 What Is KYC and Why Is it Needed?

COMPANY WILL EXECUTE POST FACT KYC PROCESS. KYC PROCESS WILL BE
EXECUTED ONLY FOR THAT PART OF CONTRIBUTIONS WHICH WILL BE
CONVERTED TO FIAT AND TRANSFFERED TO BANK.

The primary objective of token sale registration is to enforce a mandatory

Know-Your-Customer (KYC) check to prevent identity theft, terrorist

31
financing, money laundering, and financial fraud. It also allows our team to
understand our token holders better and manage risks prudently.

At carVertical we take social responsibility very seriously, thus, we believe

that it is important to play our part in combating money laundering and
terrorism financing. That is why we have benchmarked ourselves to the
same KYC standards typically adopted by banks and financial institutions
globally. The due diligence process includes screening against international
sanction/terrorist lists, politically exposed persons, and people with adverse
reputation. Risk assessment and onboarding outcome will be performed and
determined through the use of a proprietary software. The KYC process is
comprised of two parts, in the following order:

1. Automated. Your details, as provided by you, will be checked against

public sanctions and alert lists. This step will be performed by a KYC
solution firm based in Singapore.

2. Manual. If the automated step is successful, we will manually verify that

the information provided matches the identification document photos
submitted by you.

6.5 Privacy and Security during KYC

Our members’ privacy and security are of utmost importance to us. As such,
please find below the measures which will be employed to ensure your
privacy and security:

1. Only an encrypted version of your data is stored in our public servers. The
decryption key is stored in a private server. The public servers cannot initiate

32
connections to this private server. All decryption happens in our private
server which only the founding team has access to.

2. Email addresses will not be stored in our public servers, instead, only a
hash of each email will be stored in those servers. All emails sent in regards
to the registration processes will be sent from the private server.

3. Your data is not retrievable even if the password is compromised. Your

password does not give you access to your data, but rather only enables
you to re-submit your data if, and only if, requested by the carVertical team.

4. All data collected during the manual KYC will be only and exclusively
stored on our company computers, as the entire process will be performed
in our offices. For this purpose, new computers dedicated solely to this task
will be acquired and all information will be wiped out from the memory drives
of these machines after the checks are completed.

Once process is finished, data will be encrypted and stored privately for
potential future audit requests from authorities.

Neither carVertical, nor Onfido will share members’ personal data with 3rd
parties without prior consent. You should take these precautions:

1. Never send Ethereum to any address during the registration process.

There is only ONE public token sale date and it is specified on our website:
www.carvertical.io.

2. Bookmark the registration, and never visit the registration site following
any email links.

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3. Never trust emails related to the particular sale details (such as the hard
cap, Ethereum address to send to, etc.). Remember that sender’s email
address can be easily forged. 4. Never reply to our emails. Perform all your
operations on our website only. You can check your registration status on
our website using your account.

6.6 Registration for ICO

Registration for carVertical ICO and token sale will be held on our website
https://www.carvertical.io. When the token sale is launched, please double-
check the address in the browser, because scammers might create similar
websites to trick you.

Some contributors who are planning to purchase up to 2,5 ether worth of cV

will be asked to do post fact KYC process. KYC process will be me made
only for that part of contributions which will be fixated and converted to FIAT
and send to Bank account

Registration to ICO and purchaise:

1. Visit our website https://www.carvertical.com;

2. Choose “Contribute Now”;

3. Enter your personal details and ERC20 standard wallet (recommended

MyEtherWallet.com);

4. Select the type of currency you want to use for contribution;

5. Read and agree to Terms & Conditions;

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6. Contribute;

7. Make the transfer and you will receive cV after the soft cap is reached (if it
is reached, you will receive them immediately). Warning: Only send ETH from
ERC-20 compliant wallets which allow you to control your private key. Make
sure to backup your private key. Do NOT send them from an exchange,
because your ETH will be lost.

6.7 Token Sale

Our main goal is to establish a working company with cash positive revenue
stream in the shortest period possible and achieve a stable growth of the
company and community. That is why we are going to set an equal and
individually assigned purchase cap for each contributor during the ICO.

TOKEN PRICE: 1 ETHEREUM = 240 000 cV + Wave Bonus

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 CAR BONUS % CAR
ETHEREUM VERTICAL VERTICAL
TOKEN (cV) TOKEN (cV)
with bonus

Wave 1 1050 ETH 252 000 000 45% 365 400 000

Wave 2 2000 ETH 480 000 000 35% 648 000 000

Wave 3 3000 ETH 720 000 000 25% 900 000 000

Wave 4 3000 ETH 720 000 000 15% 828 000 000

Wave 5 3000 ETH 720 000 000 10% 792 000 000

Wave 6 3000 ETH 720 000 000 5% 756 000 000

Total 15050 ETH 3 612 000 000 4 289 400 000

The carVertical ICO and token sale is expected to be organized in 6 waves.

Such ICO model is introduced for the convenience of contributors: 1. they
will receive BONUS tokens; 2. it is a more transparent way to present what
carVertical features are proposed to be fulfilled.

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 Percentage Number of CAR Est. value in
VERTICAL TOKEN ETHEREUM
(cV)
Total 100% 9 975 348 837 35 000

ICO 43% 4 289 400 000 15 050

Team 14% 1 396 548 837 4 900

Founders 13% 1 296 795 349 4 550

Early 23% 2 294 330 233 8 050

carVertical.Wallet
users
Special Coins 1% 99 753 488 350
Organizational 6% 598 520 930 2 100
expenses

The team and founder tokens will be vested in 4-year period to show our
commitment to the overall success of carVertical.

ICO - total pool of cV dedicated for token sale.

Team - bonuses for the team. Locked and vested in 4 years.
Founders - locked for 4 years.
Early birds - to accelerate a worldwide adoption of carVertical, these tokens
will be given to major global companies free of charge in order to make them
start using carVertical service. These tokens are not locked.

Special Coins - special coins which will be donated to victims of accidents

which were caused by drivers who were driving a car sold by an unfair
dealer.

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Organizational expenses - expenses for the ICO organization, legal services,
incorporation, advisors, third party services, and marketing.

6.8 Are carVertical Tokens Securities?

No, carVertical tokens are not and are not intended to be securities, financial
instruments, or investment products of any kind.

For example, with purposes of financial regulation in the European Union a

“security” is often defined with a reference to “transferable security” within
the meaning of the EU Directive on markets in financial instruments
(MiFID)[1]. According to MiFID, “transferable securities” means those classes
of securities which are negotiable on the capital market, with an exception of
instruments of payment, such as:

(a) shares in companies and other securities equivalent to shares in

companies, partnerships or other entities, and depositary receipts in respect
of shares;

(b) bonds or other forms of securitized debt, including depositary receipts in

respect of such securities;

(c) any other securities giving the right to acquire or sell any such
transferable securities or giving rise to a cash settlement determined by

38
reference to transferable securities, currencies, interest rates or yields,
commodities or other indices or measures.

carVertical does not qualify as “transferable security” for the above

purposes. carVertical as a utility token in the future will only provide
opportunity to access carVertical services of. The aim of the carVertical
token is to make it possible for people to buy carVertical products as well as
with other crypto or FIAT currency.

If carVertical was not based on the blockchain technology, it would be

similar to purchasing a ticket or other document which proves that the
person has a right to use a particular service.

7. Industry Trends
So far, the automotive community seems to be excited about blockchain
evolvement. Some promising new cooperation possibilities and ventures
have arisen, and they rush to provide various solutions to the market. It is
not a product phase yet, but rather proofs of concept.

For example, Volkswagen Financial Services (VWFS), coupled with several

partners, is developing CarPass in an effort to centralize all information
about a car to a shared immutable and transparent database, immune to
fraud or falsification. Telemetry and sensor data introduce all manner of
possibility in what could be registered on such a ledger.

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Toyota has also announced a plan to use blockchain to amass driving data
which will help them to develop driverless cars. The Japanese manufacturer
is working on developing applications and proofs of concept for three areas
of the new mobility ecosystem: driving/testing data sharing, car/ride share
transactions, and usage-based insurance.

Other major automakers, including Porsche, Daimler, and Renault, have also
taken steps to investigate or integrate blockchain technology. For instance,
in April 2017, Porsche launched a competition inviting blockchain start-ups
to suggest how blockchain technology could be applied to its business.

According to Frost & Sullivan, participants in the automotive sector are

expected to spend approximately 0.6% of their total IT spend on blockchain
technology by 2025. Ranging from supply chain management to leasing, a
variety of automotive industry verticals have been identified, where
blockchain has the potential to be a disruptor. The industry is, therefore,
beginning to build momentum to experience blockchain penetration outside
of an R&D or a lab setting.

8. The Team
Audrius Kucinskas

Audrius is the leader of the project and blockchain guru. He has been
developing web and software products since 2007, mainly specializing in
DevOps engineering and iOS development. If Audrius was not a programmer,
he would definitely be a scuba diver.

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Robertas Boravskis is a graduate of University of Greenwich with a
background in marketing and business development. He is a co-owner of
gpswox.com, #1global GPS tracking service provider. Since the beginning of
2017, Rob is also an active crypto investor.

Rokas Medonis

Rokas is a business development superstar, currently acting as a board

member in StartupHighway, private venture capital fund. He is responsible for
various online and offline products in the Baltics. Rokas is also the man
behind “Keule Ruke” fast food chain brand, known for bold guerilla marketing
solutions, such as “Putin kissing Trump” and others.

Šarunas Legeckas

An experienced Chief Executive Officer with a demonstrated history of

working in the internet industry. Skilled in management, start-ups, leadership,
business development, and business strategy. A strong entrepreneurship
professional with a master’s degree in Msc Innovation, Creativity and
Enterprise Management from Newcastle University.

Aleksandras Nelkinas

Alex is an experienced software engineer, focusing on frontend development

since 2009. During his career, Alex has held senior developer positions in
Hostmaker (#11 among the top 100 UK startups), Wrap Media LLC,
Soundest, and others.

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Adomas Baltagalvis is a amazing ROI channels performance marketer. He
is famous for such amazing marketing campaigns as Filippo Loreti watch
kickstarter campaigns which has raised mor than 4 million EUR.

Gediminas Cibulskis

Storyteller at work and in real life, Gediminas is a creative copywriter in VRS

WPI Vilnius agency. With master’s degree in philology, he is a tough one to
beat when it comes to communication. Gediminas has an abundant collection
of trophies, including Cannes Young Lions award.

Nerius Rutkauskas

Senior data analyst who is used to working with large quantities of data.
Nerius has more than 7 years of working as a data analyst in Mark Monitor, a
company whose clients are almost half of Fortune 500 companies.

Justinas Gulbinas

Backend software engineer with experience in working with various

technological stacks and large profile of international products.

Martynas Kavaliauskas

When it comes to connected cars, Martynas has some experience to share.

Since 2014, he is the co-founder & CEO of GPSWOX, global GPS tracking
service provider. Before that, Martynas was an IT director at German's Otto
GmbH.

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Aleksandras Gaška

With 3 years of experience focused towards customer satisfaction, a little

while back served as a community relations manager and jack-of-all-trades at
Monetha (raised $37 million in 18 minutes) and community relations / blog
writer at Mysterium Network (raised $14 million in 45 minutes).

Helps carVertical with the long-term growth and partnerships, as well as the
Blockchain side of the project, including the economical token model.

Nicolas Klaus

Nicolas is a Berlin-based business development manager, excited about the

changes that blockchain brings. With the Master's degree from University of
Amsterdam, Nicolas is helping carVertical with communication and
partnerships.

Arūnas Vaitkus

Arunas started his professional career 7 years ago in an international Law

Publishing company in London starting as a developer, quickly following to
Data Architect Lead role and leading a multi-continental team responsible for
delivering part of global publishing platform. As part of technology stack and
shift towards Big Data, Arunas had a chance to work on NoSQL database
that in the end lead to opening of a consultancy company. Further down in his
career, Arunas took an opportunity in consulting a leading Swiss investment
bank over the implementation and delivery of NoSQL Data Warehouse. Also,
whilst consulting, Arunas and his team had a chance to work on Oracle, data
visualisation and BI tools. After that Arunas worked on blockchain document
storage and retrieval projects. Lately, his focus is in an international company

43
building agricultural data analytics platform for big farmers globally along with
food processors and investors. Current technology includes NoSQL
databases, semantics & ontologies powered by a blockchain technology.

Advisors:
John Mack

President & CEO CIE Automotive China

Mr. Mack is a top automotive executive, previously employed by BMW,

General Motors and FIAT Group. He lived in countries such as Australia,
Germany, Italy, France, Poland, USA, Thailand, Singapore, China and
others.

Mr. Mack’s areas of Expertise include Automotive Business strategy,

Operations strategy, Design and Development of cars. He studied
Mechanical Engineering in Swinburne Australia and received MBA from
European University in Germany.

Brian Dublin

CFO Sterling Eastern (Zug, Switzerland)

Mr. Dublin is Zug (Switzerland) based CFO who has led business
transformation & delivered growth in $multi-billion companies. His corporate
experience include Zymtech AG, Virgin Media Internet, SPI Group, TMP
Worldwide. Mr. Dublin is the graduate of Columbia University.

44
Tadas Volbikas

CEO & Board Member Legator

Corporate experience: 10 years of active leadership, structuring and

executing operations of insurance brokerage. Areas of expertise: automotive
insurance, finance, banking.

Steve Chernysh

Vice President, Russian Association of Automotive Dealers

Mr. Chernysh is an experienced automotive executive. He has been working

with top automotive brands, including Volvo, Mazda, Kia and Toyota. Mr.
Chernysh's areas of expertise cover automotive sales management, business
development and investments.

Anatoly Ressin
CEO BlockVis
Blockchain, cryptography expert and a current contractor of famous Civic.

Mr. Ressin believes that blockchain will prevail and ultimately change our way
of thinking about the entirety of the ever-changing Digital World.

Amongst numerous initiatives, Mr. Ressin has also contributed to those

changes by participating in the development of Civic and by organising
blockchain competence and education activities.

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Jonas Udris

Deputy Director Lithuanian Center of Registers

Corporate experience: 10 years of active leadership, structuring and

executing operations of insurance brokerage. Areas of expertise: automotive
insurance, finance, banking.

Mindaugas Valančius

Ex-Data Protection Lawyer COBALT Legal

Corporate experience: Valiunas Ellex, Mykolas Romeris University, Legal

Services Group Ltd. Areas of expertise: data protection, IT and IP.

Peter Kuepper

Head of Transmissions’ Program Management BMW Group

Project experience: BMW i3 powertrain, Rolls-Royce powertrain. Areas of

expertise: electric vehicles, electronic control units, vehicle diagnostics.

Raid Naim

Ex-IT Chief Architect BMW Group

Corporate experience: mobile.international GmbH (eBay Inc.), BMW of North

America, Futurice (Germany). Areas of expertise: digital transformation, lean
management, agile software development.

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9. Product development timeline
The carVertical ICO will start on 26th of December 2017 and end on 4th of
April 2018 or when it hit hard cap. During the 2018, we will develop a working
carVertical product (web product and apps), which can cover B2C, B2B &
Public access parts of the business model. From January 2018, we will start
on-boarding different local and global databases and registers which belong
to countries or private owners and start getting revenue on June 2018.

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10. For Contributors
6 subjective arguments proving why carVertical Token valueis
going to grow in the future

1. carVertical is projected to start generating revenue from its products in July

2018. Our cash flow analysis states that in five years we will hit a revenue of
27,204,000 EUR with EBITDA of 10,524,000 EUR.

2. Token will be the only way to buy carVertical services. Stacking comes in
place: person who owns more carVertical tokens gets significant discounts
when buying our products. That means cheaper API calls, reports, whitelabel,
car insurance and other services.

3. carVertical Token value will directly correlate with effectiveness of our

service. Effectiveness of the service will be determined by efficiency of our
machine learning and mathematical models. Machine learning and
mathematical models will get better over time with more data.

4. The users carVertical onboards generate more and more data over time.
So the value of the token will grow exponentially with the number of users we
will onboard.

5. The team is already building this product. ICO came as an opportunity, not
as a goal. This proves that carVertical is not just another ICO. We have
signed agreement with Diginet, biggest classifieds website group in Baltic
states, to deliver white label solution for their auto classified sites.

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6. All national and privately held registries will move to blockchain in a few
years. We’re going to be the first “sitting at the table” when governments and
big companies come searching for the solutions to their needs.

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