Please describe your proposed solution.

<u>NFT for FT Swap Protocol</u>

Our NFT for FT Swap protocol is an open source smart contract solution ("SC") allowing for the distribution of fungible tokens ("FTs") in exchange for users sending NFTs to the SC from wallets which meet specific criteria, including:

(a) Number of NFTs of a specific Policy ID

(b) Amount of FTs of a specific Policy ID

This tool will be utilized in the L4VA Initial Sacrificial Offering ("ISO") event to prove the concept.

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<u>Additional utility we are building at L4VA:</u>

The Status Quo: Non-fungible asset markets are naturally illiquid (not-liquid) and inefficient, due to the unique nature of each asset. In traditional finance there are centralized players that make an on-demand market for sellers. (e.g. Fannie Mae, the public/private institution that was set up to automatically purchase any mortgage which “conforms” to certain standards in the USA; acts as a market maker for mortgages, which are non-fungible assets). To support the widespread adoption and tokenization of NVAs, we need a decentralized automated protocol to serve this function.

Immediate Solution: Our initial use case will be improving efficiency of NFT markets on Cardano, ensuring that sellers have a simple way to sell NFTs at floor market prices.

Future Solution: The data we collect will be valuable to analyze and then utilize to train AI systems capable of optimizing the pricing of Non-fungible Virtual Assets (“NVAs”) on our platform. This data will help to develop later iterations of the protocol that will allow for fair market purchasing of assets based on their meta-data and other information, not just the floor price of the asset collection.

Mission: Our mission is a dual mandate to deliver automated liquidity to non-fungible virtual asset markets and maximize value to L4VA token holders over time.

Values: We plan to achieve our mission by designing and building our protocol to be flexible, intuitive, simple, and scalable.

What are NVAs? In an effort to broaden the view of what constitutes an NFT, we have coined the term Non-fungible Virtual Assets (“NVA”s) to include NFTs, Digital Collectibles, Traditional Non-fungible Assets (mortgages, insurance, real estate, etc.), and other New / Synthetic / Exotic Non-fungible Assets yet to be tokenized on the blockchain. We believe that NVAs and the innovation of NVA Applications (“NVAP”s) will be required to ultimately deliver mass utility and wide-scale adoption of blockchain technology into the future.

Who We Engage: The project will initially engage all of the participants in NFT markets on Cardano for a portion of their trading (e.g. when an owner wants to sell an asset quickly), then will evolve to support market participants across all forms of NVAs traded on the blockchain.

Scaling Opportunities: We are building this protocol to scale and support all types of non-fungible assets over time (e.g. real estate, bonds, mortgages, insurance policies, annuities, precious materials, etc).

Please define the positive impact your project will have on the wider Cardano community.

There does not exist an NFT to FT Swap protocol that will allow one or many NFT asset collections to be utilized and exchanged for FTs.

This tool will allow for many new applications and tethering of value between NFTs and FTs.

Impact Use Cases:

1. The tool will be open source and can be applied to many other projects, to be proven out through the use case with L4VA's Initial Sacrificial Offering ("ISO").
2. Unique method for distribution of new fungible tokens in exchange for NFTs
3. Easy to use method for fractionalizing NFTs into FTs
4. Other unique use cases for transferring asset value across one or multiple digital assets in NFT form into fungible tokens
5. Flexible changing of criteria required for eligibility to engage in the smart contract allows for infinite applications.

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<u>Additional Impact of L4VA:</u>

Our application is solving a major problem in NFT markets and laying the foundation for widespread adoption of Cardano as the blockchain of choice for Non-fungible Virtual Assets (“NVAs”) and NVA Protocols (“NVAPs”). Our solution is designed to be fully open source, with open APIs for integration into other marketplaces and applications, helping to solve market inefficiencies across the Cardano ecosystem.

Immediate Benefits: L4VA will immediately deliver value to Cardano NFT market participants by providing (1) instant automated buy-side liquidity for sellers of NFTs at the floor price, (2) create a fun new marketplace and circular economy for NFT selling and auctions, and (3) have a positive impact on market floor prices by equalizing supply and demand during periods of selling pressure.

Intermediate Benefits: L4VA will attract projects seeking to utilize blockchain to build digital non-fungible asset protocols (NVAPs) to solve real world problems (e.g. mortgages in developing countries, tokenizing real estate, insurance, etc.), because Cardano will have L4VA as an open source application and open API integrations to support the proper functioning of these markets during periods of low volume and/or volatility.

Future Benefits: L4VA has the potential to serve as the automated market maker for all NVAPs across all non-fungible assets, which will drive adoption of Cardano by large enterprise players who seek to integrate their assets as NVAs on the blockchain with the most advanced automated market maker for NVAPs. We are building this protocol to scale to support all types of non-fungible assets over time (e.g. real estate, bonds, mortgages, insurance policies, annuities, precious materials, etc).

L4VA is a true DeFi solution AND <u>has broad utility applications across many important appications</u>:

Physical products - Tokenized housing as a Cardano native asset, Fractionalized physical asset ownership, others…

In order for physical products to have a functioning market the owners must have the ability to sell assets efficiently at a fair value; without L4VA these projects innovating in this area will struggle if there isn’t consistent fairly priced demand for their NVAs.

DeFi - Stable coins, DEXs, borrow & lending, synthetic assets, others…

By definition our protocol is a true DeFi protocol in every way. We are a decentralized financial protocol delivering value and utility to the NFT market today and the NVAs and NVAPs of tomorrow.

Gaming - Open world games, card games, RPG, others…

For every unique NVA across gaming, there needs to be fast and reliable markets functioning to support the purchasing of these in-game tokens from sellers in real time; L4VA solves this.

Climate Change - Solutions that help to solve environmental issues

Carbon credits have not made a major impact on blockchain yet, largely due to the complex nature of these assets. L4VA could be the protocol that makes Cardano the right place for carbon credit owners to trade carbon credits as NVAs, since L4VA can help make an efficient market for these assets.

Marketplaces

Marketplaces are inefficient for trading NFTs and NDAs. L4VA is a different type of marketplace, providing an enhanced solution for markets to generally operate more efficiently.

Insurance

Insurance policies are all non-fungible. Decentralized insurance underwriting financed by a diversified pool of investors requires that there is a protocol to purchase policies from applicants initially in order to collateralize these policies into portfolios which can be fractionalized and sold. L4VA will play a critical role in helping to augment NVAPs operating in this space, by providing buy-side liquidity for sellers of policies quickly.

Artificial intelligence

We plan to utilize all of the data captured through usage of our protocol as a training set for AI models to help drive more specific pricing intelligence that will allow us and other applications to better understand market pricing of NFTs and NVAs so that we can provide automated buy-side liquidity to sellers at the floor price, and potentially provide instant liquidity quotes for sellers at higher prices based on p2p market pricing correlated to metadata and auction performance on L4VA.

What is your capability to deliver your project with high levels of trust and accountability? How do you intend to validate if your approach is feasible?

Our Founder is the CFO of an enterprise software startup, who in partnership with a leading Cardano development agency (Anvil) and a team of professionally trained design, engineering, and marketing partners, are committed to responsibly utilizing funds from Catalyst to support the delivery of the L4VA protocol.

Our founder and executive manager of the project, Rob Eberenz has over 18 years of professional experience in investment banking, economics, and technology management, currently serving as CFO for an enterprise software startup. Over the past 3 years, Rob has deeply immersed himself in the Cardano ecosystem and closely studied the rise and adoption of NFTs, which combined with his extensive experience in finance, fund raising, entrepreneurship, and software project management makes him highly capable to initiate and lead our project.

Our co-founders and team consist of a senior UX/UI developer (William Devogalaere) who previously completed a successful ICO and NFT launch on Ethereum, and senior full-stack software engineers (Casey Siebel and Nick Goehner) who have experience developing blockchain web apps, as well as serving as senior engineers on leading enterprise software teams.

Our partner for smart contract development, Anvil Development Agency is a 15 person team that is deeply embedded within the Cardano community. Our developers have more than 50 years of combined experience in software development and programming.

Over the two years since smart contracts went live on Cardano, Anvil has become one of the leading backend development service providers on Cardano and has amassed an extensive record of delivering state-of-art solutions for projects building on Cardano.

What are the key milestones you need to achieve in order to complete your project successfully?

Complete Requirements, Tech, and Design (Month 2): Complete technical requirements, UX, and UI design for the swap portal.

Acceptance Criteria:

1. Validate technical requirements
2. Approve UI designs are in line with requirements

>Testnet (Month 3): Private testnet launch of the swap protocol open to holders of the official L4VA NFTs (Relics of Magma). This is when test NFTs are first sacrificed in exchange test fungible tokens.

Acceptance Criteria:

1. Prove the functionality of the protocol works in testnet

>Mainnet Launch (Month 5): Mainnet public launch for the swap protocol at the "ISO" event of the L4VA protocol

Acceptance Criteria:

1. Successful functioning of swap protocol and distribution of $L4VA Token in exchange for whitelisted NFT projects sent to the smart contract

Who is in the project team and what are their roles?

Rob Eberenz - Founder / Principal

• 18 years experience in investment banking, venture investment, and entrepreneurship
• 4 years as CFO of an enterprise software startup
• $700M+ career fundraising across VC, PE, M&A, and commercial real estate transactions
• Twitter: @rleberenz
• Linkedin: https://www.linkedin.com/in/rleiii/

William Devogelaere - Design Lead

• UX/UI Designer
• 10+ years experience in web app and crypto app design

Nick Goehner - Senior Engineer

• Front-end web app engineer
• 20+ years experience
• Co-founder of BlackTurtleTech.com
• Linkedin: https://www.linkedin.com/in/nicholasgoehner/

Casey Siebel - Senior Engineer

• Full-stack senior engineer
• 15+ years experience
• Ex-Docker, Reddit, Ouster
• Linkedin: https://www.linkedin.com/in/casey-siebel

Bailey Anderson - Marketing Manager

• Web 2.0 & 3.0 marketing expert
• https://redphoenixglobal.com/

Anvil - NFT & Smart Contract Development Agency

• Top NFT Minting Agency
• Expert Plutus Developers
• Full Stack Engineers
• https://Ada-anvil.io

Advisors:

Andrew Mrvos (Cinnamon Bunn) - Marketing Advisor

Adrian Fanatiu (DeadPxlz Founder) - Cardano Technology Advisor

Community Management and Support

• We plan to hire for this role, we have begun to screen candidates but do not yet have a strong need and there is ample supply of interested young talent.

Please provide a cost breakdown of the proposed work and resources.

70,000 ADA = Swap Protocol Development : Smart contracts protocol development governing the core functionality of the protocol which enables automated purchasing of Non-fungible Virtual Assets on Cardano.

10,000 ADA = UX/UI Design: We subsidized the cost of UX/UI design in our Catalyst proposal for this scope of work, by assigning it to a core team member who will be responsible for producing full designs for the web app. In exchange we are budgeting a team token allocation and other payment from Other Sources of Funds. See William Devogelaere in team.

20,000 ADA = Front-end Development: We subsidized the cost of Front-end Development in our Catalyst proposal for this scope of work, by assigning it to two core team members who will be developing the front-end web application. In exchange we are budgeting a team token allocation and other payment from Other Sources of Funds. See Nick Goehner and Casey Siebel in team bio.

Emission (Auction) Protocol: Smart contract protocol development governing the demand sensitive automated auction mechanism and instant redemption mechanism.

Governance Protocols: Governance mechanisms interfacing with both the demand protocol and supply emission of the application, to allow for decentralized management of the application via token holder voting, governing protocol whitelists, blacklists, purgatory function mechanics, profit distributions, etc.

Tech Support & Dev Ops: Our full-stack engineering team (Nick Goehner and Casey Siebel) will initially be charged with providing technical support during the Test-net, ISO, and Public Launch phases of the project, with the expectation that we may need to add full time employee engineers at a later stage, which we have budgeted for in Other Sources of Funds and team token allocation.

Community Management & Support: The core team is managing the community leading up to the release of our NFT mint. We are budgeting NFT proceeds and team allocation of the L4VA token as remuneration for the community management and support team.

Marketing: Our NFT mint and gamified staking are designed to drive awareness throughout the community of potential users, who will ultimately be our early adopters and protocol users (i.e. our investors are our early customers, which means we can activate the community with incentives to drive social media marketing campaigns, greatly reducing the need for traditional advertising and promotion). For marketing strategy and management, see Bailey Bio. For any additional marketing expenses, we plan to finance these through Other Sources of Funds (see below).

Legal: We have budgeted legal fees, but we plan to finance these through Other sources of Funds (see below).

Project Management: Technical project management will be managed as part of the scope for each deliverable above, with Anvil tasked with project management of the back-end protocol development project. Executive project management will be provided by Rob Eberenz in exchange for team token allocation and payment from Other Sources of Funds, no need for Catalyst financing; see bio.

Other Sources of Funds:

• NFT Mint: We have successfully raised 50,000 ADA via our first NFT mint, and intend to raise an additional 850,000 ADA via additional mints.
• Founder funding: The core team has funded the project to date, and are capable of supporting the project personally if needed.
• Private funding: The core team have extensive experience, existing relationships, and a track record raising funds from private investors and venture capital to finance software projects in the past. See Rob Eberenz bio.

How does the cost of the project represent value for money for the Cardano ecosystem?

We have made best efforts to minimize the total funding amount requested, to increase the return on investment of our project for the Cardano community and ecosystem (see Other Sources of Funds above).

We have engaged Anvil Cardano development agency for smart contract and back-end protocol development (reflected in the quote here). This is the market rate for U.S. based smart contract development.

We are providing heavily subsidized (75% reduced cost) team labor for the design and development of our web app (reduced request for Catalyst funding).

We have fully subsidized team labor or covered costs from Other Sources of Funds for (1) Executive Project Management, (2) Marketing Management, (3) Community Management, (4) Legal Fees, and (5) Tech Support, DevOps, etc. (no request for Catalyst financing).