ShipChain Whitepaper

Tuesday, July 31, 2018
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CONTENTS I. INTRODUCTION • Abstract • Overview • How it Works Now • Problems • Our Vision II. ECOSYSTEM • Technology • The SHIP Token • Example User Stories III. BUSINESS PLAN • Team • Partners • Funding & Budget • Revenue Model • Roadmap • Future Developments

ABSTRACT Consider the magnitude of the logistics industry. Looking back through history, the wheel is essentially INTRO the cornerstone of modern civilization. It brought us transportation, and transportation afforded us the systematic transfer of goods. From farm to market, and from market to table, the movement of products in bulk has been the single most important adaptation of the last 10,000 years. ECOSYSTEM Trade, in turn, is our second oldest and most important pivot. From long-distance trading, our econo- mies were established, which allowed modern civilizations to thrive. The oldest coin-based currency can be thought of as a proxy for trading values greater than two hands can carry, or for trading commodities that aren’t physically available nearby, and so currency itself necessitates logistics. Together, trade and logistics form the backbone of human achievement. PLAN Despite the revolution brought on by the advent of the cart, the ship, the engine, and the airplane, the shipping industry as a whole has been one of the slowest markets to adapt and evolve over the past century. The Information Age has disrupted nearly every major workforce on the planet. Globalization has opened new trade routes, technology has changed the way we shop and spend, and so naturally, the demand for shipping has reached an all-time high. It’s no wonder that most shipping customers are shocked and dismayed to find their brokers still relying on artifacts like paper records, written manifests, and spoken words to get cargo from point to point. It’s time for a breakthrough in how we handle freight. Blockchain technology is often characterized as “disruptive” because it can revolutionize the way we interact as a society. Distributed ledgers are disruptive for ancient business models in the same way email disrupted the mailbox. Applied correctly, a blockchain will facilitate the digitization of record- keeping processes related to the trade of assets, even in scenarios when intermediaries and brokers are incentivized to resist revolution. The blockchain can improve the transportation of commodities in every country, across the entire globe, and beyond. We’re launching ShipChain to make that leap possible. PAGE PAGE3 3

OVERVIEW The movement of goods impacts daily life for KPMG, 40% of global manufacturers lack infor- INTRO people around the world at a staggering scale. mation and material visibility across their supply For additional perspective, here are some stats: bases (3). In some cases, companies are still us- ing paper ledgers to track their products. Given • The market’s global value was $8.1 trillion in that upwards of 65% of the value of a company’s ECOSYSTEM 2015, and is expected to grow to $15.5 tril- products or services is derived from its suppliers lion by 2023 (1), making it one of the largest and its supply chain (4), utilizing older highly in- industries on the planet. effective systems results in tremendous amounts • 55 billion tons of freight was transported in of wasted time, resources, and money. 2015, with expected growth to 92 billion PLAN tons by 2024. But as freight volume increases, so do custom- • In the United States, freight and logistics er expectations. Both industrial and individual spend in 2015 totaled $1.48 trillion, nearly customers expect faster shipments with more 10% of the country’s GDP (2). flexibility, more transparency, and lower prices. Shippers can find it challenging to handle all the Unfortunately, the supply chain has major complexities of booking, tracking, tracing, and bottlenecks. The lack of a unified communica- regulatory compliance, unless they hire teams tion platform prevents the various players from of full-time, experienced staff. This puts smaller interacting efficiently. Most land transportation shippers at a disadvantage, and makes larger providers, carriers, governments, customs bro- shippers extremely inefficient. kers, and freight forwarders have outdated ways of keeping track of their goods. According to PAGE 4

HOW IT WORKS TODAY The process of shipping freight can occur across many INTRO channels, including air, sea, rail, or truck. Four major en- tities make up the lifecycle of any shipment, regardless of the channel being used. ECOSYSTEM Shippers are the customers of the logistics services; they are the actors who have freight and need it transported. • Shippers don’t want to coordinate multiple drivers • They don’t want logistics headaches • They want a predictable price PLAN • Shippers want freight accountability Brokers coordinate carriers to organize multimodal orders • Brokers act as the gatekeepers of the industry • They choose combinations of reputable carriers • They get payment from shippers and insure goods • They often provide some basic tracking services • Brokers charge a high middle-man markup Carriers provide freight transportation services • Carriers may be rail, air, sea, truck, or other • Most carriers only handle one segment of a trip • Usually, a multi-leg trip involves several carriers • A carrier usually owns a fleet of delivery vehicles • Carriers often have poor transparency and records Drivers are the operators of a single vehicle in a fleet • Some are “owner-operators” acting also as Carriers • Sometimes handoffs lack accountability • Tracking fleets of drivers can be hard • Drivers don’t have incentives to save gas • Drivers can lose or damage goods PAGE 5

PROBLEMS 1. Bad Tracking. For end-users, the regularity ability. As brokers withhold information on who is INTRO and reliability of shipping status updates is the moving which cargo and fragmentation amongst primary factor in the perceived quality of a ship- carriers causes uncertainty about where the car- ping experience. If a package is slow or late, but go actually is at any given time, shippers often has regular updates, customers are less likely to have no way of knowing who is responsible for ECOSYSTEM complain or file chargebacks against merchants. the cargo. Handoffs are one of the largest sourc- But the shipping industry has not kept up. Track- es of error in freight, with neither side wanting ing across multiple carriers is extremely fractured, to take responsibility for a container that didn’t and tracking provisions vary between modes of make it from the ship to a truck. transportation. Tracking problems lead to con- PLAN fusion among carriers, failed handoffs, failed de- 4. Middleman Markup. Brokers and forwarders liveries, and even lost shipments. Economically, are largely to blame for all of the above issues, this is a disaster. Lost efficiency, wasted fuel and acting as gatekeepers to the industry and incen- time, and missing products combine to cost the tivizing poor transparency and tracking practices, shipping industry billions of dollars per year-- and yet they typically charge a significant premi- costs that brokers rarely cover and are ultimately um–sometimes 30-50%–for their claim of mak- passed on to shippers. ing freight easier to manage and ship. In reality, they are high maintenance, increasing the cost 2. Lack of Transparency. Bad tracking is both of freight and decreasing what carriers get paid. the cause-of and caused-by equally harmful gaps in transparency. While tracking issues are system- 5. Misaligned Incentives. The above issues ic and inherent to the task of moving goods, the can be summarized simply as a problem of mis- failures of transparency are largely due to bad aligned incentives. It behooves carriers to provide data handling practices (or worse, due to parties poor tracking because they gain deniability in the being incentivized not to share accurate data). case of lost or damaged freight. There’s nega- Often, due to fragmentation, uncertainty, or to tive incentive for brokers to be honest about the protect the exclusivity of their arrangements, bro- whereabouts or handlers of a shipment because kers can’t or won’t tell a shipper exactly what car- they need to protect their exclusive relationships rier and driver are carrying their freight. and always be able to shift the blame. Drivers are incentivized to carry using unsafe practices that 3. No Accountability. The US Federal Bureau of may risk damage to goods. Everyone gains from Investigations estimates annual cargo theft loss- dishonesty to the next party and to break laws es exceeding $30 billion USD in 2016 and rising, or safety regulations. Shippers and customers are with an average theft value of $190,000 (5). Car- thus incentivized to find a better solution. go theft raises prices across the industry approx- imately 20%, negatively impacting all customers of the shipping industry–nearly every person on earth. The combination of tracking and transpar- ency failures together lead to a lack of account- PAGE 6

OUR VISION ShipChain was founded with the mission of solving the greatest problems facing the logistics industry INTRO today. Our solution requires deep technology, but our vision is quite simple. Imagine a fully integrated system across the entire supply chain--from the moment it leaves the factory, field, or farm--to deliv- ering the finished product to the customer’s doorstep; federated in trustless, transparent blockchain contracts. This is ShipChain, the future of shipping. ECOSYSTEM Tracking & Transparency We will unify shipment tracking across the Ethereum blockchain, using our ShipChain side-chain to track individual encrypted geographic waypoints across each smart contract. With this system, the meaning of each waypoint will be encrypted, accessible for interpretation by only the parties involved. This will give PLAN shippers more visibility across their supply chain and allow carriers to communicate with ease, reducing delays and miscommunications. Information about loads, geo-waypoints, and basic compliance infor- mation will be recorded and publicly validated within the sidechain. Upon delivery and confirmation, the contract will be completed and recorded on the main blockchain, releasing any payment escrows. With the upcoming Electronic Log Device (ELD) mandate from the United States Department of Trans- portation (6), ShipChain will work with the most popular ELD developers to integrate directly and march toward our first goal: completion of Track & Trace technology. The initial step of working with these providers will allow us to integrate immediately into the largest network of US-based trucking freight companies, giving our platform a full network of freight movement without the arduous requirement of connecting to individual freight companies (or even individual Owner-operator trucks) one at a time. PAGE 7

Similarly, there is an opportunity for us to integrate with the major US railroads, global ocean freight providers, and major airlines, one-by-one, to tie in and create our multimodal blockchain-based track- ing system. The internal tracking of each carrier will be the first step in unification, with their internal confirmations being fed to the blockchain. Individual pallets or crates will be tied to the address of the INTRO container they are on, and containers will be tracked as a whole. Over time, business development will assist these carriers with the replacement of their base internal tracking with the ShipChain system, al- lowing a greater level of visibility across all of their multimodal shipping partners. ECOSYSTEM Decentralized Brokerage In the current system, freight brokers exist to facilitate the transactions of loads from shippers to carriers; they are typically asset-light and focused on sales. Brokers find loads, mark them up, and sell them to a carrier, which increases the cost of shipping and reduces profits for carriers and their crew. The Ship- Chain blockchain will supplant the need for brokers by allowing carriers the ability to find shipments and PLAN intelligently route their team for multimodal transportation based on factors such as distance, traffic, weather conditions, fuel use and more. This load system will generate a smart contract upon pick-up and will hold payments in escrow until conditions for release are met while using the main blockchain and side-chain for tracking and cargo security monitoring. Asset Security Deploying blockchain technology into the freight industry to encode geographic data will increase car- go visibility, and thereby dramatically decrease theft. By using barcodes or hardware RFID integration, assets can be automatically verified each time electronic logs are reported, increasing security and pro- viding peace-of-mind for all parties. Permissioning, immutability, and encryption are inherent benefits of blockchain technology, allowing select individuals to access, examine, and add critical transport data, but no one will have the ability to change or delete existing data. By bringing accountability to every step of the process, the blame game between carriers, brokers and shippers is mitigated. Trustless Incentives By encoding and encrypting waypoint information and data about which loads belong in a shipment, digital escrows can be used to fairly assess whether goods actually arrived in a particular shipment. Con- flicting accounts of the whereabouts of goods are eliminated, and individual players can be rewarded for their participation in a system that operates without trusting any particular party’s story about what happened. In future iterations of the platform, we plan to provide driver rewards for obeying speed limits, behaving safely, and observing green fuel economy practices. Unified Management Subsequent to the implementation of blockchain federation of the fair and secure transportation of goods, ShipChain will build a unified management platform for leveraging the smart contracts to pro- vide modern and usable services across the shipping industry. ShipChain is dedicated to building to an open ecosystem, and although ShipChain Web will be the first application, our Smart Contracts will be a building-block that thousands of other platforms can freely build upon to solve shipping issues, big or small. The decentralized brokerage will be an open marketplace connecting shippers to carriers, and ShipChain will provide the first app for cargo booking; shippers will be able to log on and place an PAGE 8

order from “Point A” to “Point B” using suggested routing and shipping methods based on cost, time in transit, and contents. INTRO ECOSYSTEM PLAN PAGE 9

TECHNOLOGY Contracts & Side-Chains INTRO The ShipChain Contract is an Ethereum EVM smart contract that can be duplicated and used by anyone to orchestrate a shipping escrow on the distributed ledger. The overall shipment completion will be stored on the main Ethereum blockchain, and to keep costs low, individual tracking waypoints and load data can be stored and verified in an associated side-chain operating on the ShipChain Protocol (fork of ECOSYSTEM Ethereum software), such as the one ShipChain Foundation will implement and maintain called “Ship- Chain Prime.” Large partners will be able to operate their own ShipChain Protocol side-chains, with (or without) aid from ShipChain Foundation. When a shipment order is placed, a smart contract will be initiated. That contract will include a hash sum PLAN signature of the delivery information for the shipment, including beginning address, final delivery point, carriers used, number of items in shipment (as granular as preferred with an address for each item being possible), weight, dimensions, quantities, HS codes, intermediary data, and more. Anyone with a valid copy of these values can verify the signature and assert the validity of the contract on the main Ethere- um blockchain. The data itself can optionally be encrypted and stored in a sidechain for more specific point-by-point and piecewise package tracking. In result, this essentially provides a more detailed Bill of Lading. That contract will be completed on delivery, with validations and waypoints recorded to the blockchain along the way. If all waypoint validations are affirmed, the contract will be executed (and each contract will be able to specify its own terms for how any disputes will be resolved, including third party arbitra- tion). The full cargo validation system will be in place alongside the tracking system. Carrier partners will be able to pull data from the ShipChain tracking system and post to their systems and websites for wide use, creating a unified tracking system that eliminates the need for internal P.R.O. numbers or multiple tracking numbers. ShipChain Web The decentralized brokerage system will be comprised primarily of an open marketplace connecting shippers and carriers. ShipChain will allow open access to its blockchain marketplace, but also build the first platform of services upon it, ShipChain Web Platform, a centralized system for booking and man- aging freight shipments across many carriers and modes of transportation. If for example, the shipper has five full shipping containers of shoes coming from China to the United States, the system will recognize that a sea carrier, rail carrier, and final truck carrier will be the best op- timization for cost and speed based on the size and type of shipment. The shipper will then be able to see the capacity on each leg, book their own routes, see estimated delivery times, and have full control over their supply chain without the need for a broker. Carriers will be able to post capacity for their shipping vehicles and lanes, dynamically set pricing based on supply/demand, adjust for estimated fuel cost, and have cargo booked to their routes automatically. PAGE 10

Customs brokers, if needed, will also be granted account rights to assist with paperwork filing. With all necessary information held in a smart contract, this process will be quicker and easier than ever before. Regulatory compliance may require ShipChain to be licensed in freight brokerage, freight forwarding, and have an internal customs brokerage. While shippers will book their own routes, ShipChain may INTRO need to be the official booking agent for freight, for compliance purposes. ECOSYSTEM PLAN Our target rollout date for the first version of the ShipChain Web Platform unified tracking system is Q3 2018. Maintenance and continued carrier integrations will be an ongoing process for the tracking system. PAGE 11

THE SHIP TOKEN INTRO Usage, Purpose, Supply and Demand Ownership of at least 1 full SHIP token grants “ShipChain Membership Status.” This is required to access the blockchain for both the purpose of tracking shipments, as well as the purpose of booking freight. ECOSYSTEM Transactions on the blockchain for freight shipments will be paid in tokens, and settled in tokens. The ShipChain Web platform connecting to the blockchain will allow users to pay either directly in tokens they hold, or purchase tokens from ShipChain for booking freight (allowing, for example, USD, EUR or cryptocurrency payment). PLAN Tokens valued at up to 20% of each freight transaction will be given to the driver/carrier as “gamified” incentives for safe and timely deliveries, as well as environment focused such as reduced idle time. From there, drivers will either be able to sell their tokens on exchanges, or redeem those tokens via partner- ships ShipChain will form for various rewards, such as gift cards, fuel discounts, and more. Initial Token Generation Event The problems ShipChain will tackle are systemic to a multi-trillion dollar industry, one historically slow moving and resistant to change. We have plans for delivering our offering on our current funding, but bringing our full vision to life is a huge endeavor and would be best served by opening ourselves to outside funding. Therefore we are running a Token Generation Event or “TGE” to sell an initial supply of our tokens in order to jumpstart the ShipChain economy and supplement funding to help us deliver the best product possible. This ‘TGE’ will occur in multiple phases, including Pre-Sale, Sale 1, and Sale 2. Pre-Sale and Sale 1 will occur immediately, ending after January 2018. Sale 2 will occur upon the completion of several mile- stones, including the live use of our web platform, version 1.0 of our full tracking system, and generation of live revenues with real client shipments. We anticipate Sale 2 will occur between 1-2 years after Sale 1. PAGE 12

Pre-Sale SALE 1 SALE 2 Who? Completed Privately Completed Privately TBD INTRO Upon milestone When? November 2017 January 2018 completion How Many? Up to 75 million SHIP 29.17 million SHIP 120.83 million SHIP ECOSYSTEM As determined by Approximately $10 Raise Amount (USD) Up to $20 million auction/market price million USD in ETH at time Per-participant Limits $25,000 up to $5 million $10 up to $1 million $10 up to $1 million PLAN Anyone interested in participating in our crowdsale must undergo typical screening processes to comply with KYC/AML “Know Your Customer” and “Anti-Money-Laundering” regulations. PAGE 13

Good Driver Initiatives ShipChain is committed to making the world a better place and protecting the environment from the harmful effects of greenhouse gas emissions. Our plan includes a retainer of 13% of the total supply of tokens to be distributed over 5 or more years as incentives for ecologically responsible driving at safe INTRO speeds. By offering these rewards, we ensure that the safe and timely delivery of goods is the top pri- ority for everyone. ECOSYSTEM PLAN PAGE 14

EXAMPLE USER STORIES In order to illustrate some cases where ShipChain might be most useful, we’ve invented a few fictional INTRO stories about made-up companies – based on real problems faced by thousands of similar businesses across the world. Any similarities to actual brands and trademarks are either innocent coincidences or systemic commonalities ECOSYSTEM The Major Food Production Company Chik-A-Burg Meats is facing increasing regulatory burden from the USDA and FDA with harsh fines and penalties for non-compliance, requiring end-to-end tracking of anything that touches the food supply. New rules in the Food Safety Modernization Act say that livestock feed must be traced from farm to trough, food products must be tracked throughout the supply chain, and all transport trailers need PLAN audit logs of their prior loads and cleaning histories. Larger third-party freight companies are hesitant to comply, which forces Chik-A-Burg to hire mostly independent drivers who feel overburdened by this new litany of checks and measures. Enter ShipChain: a novel blockchain solution that allows Chik-A-Burg to instantly find and connect with drivers and carriers who meet their regulatory needs. The loads previously carried in their trucks can be verified as not hazardous waste, medical equipment, nor other non-compliant materials – without revealing sensitive information about previous clients – validating that the loads would comply with food supply chain safety mandates. Using the ShipChain Prime side-chain for granular tracking, RFID and barcodes can be combined with ELD integrations allowing full traceability and visibility of supply, literally from farm to table. Retailers, carriers, and customers alike can all validate the source farm, lot number, distribution center, port information, and even individual trailer on a burger-by-burger basis. If a closer audit is needed, regulatory authorities can be provided a set of private encryption keys allowing them access to the full history of a given trailer’s loads and hauls. The eCommerce Retailer needs to ship a container of fleece footwear from the supplier in China to their warehouse in Chicago, but they won’t use a broker because of bad experiences with dishonest inter- mediaries charging 50% fees just to lose their shipments. Instead, they have hired Steve, full-time (plus nights and weekends) staff member whose only job is to research carriers and plan the logistics of mov- ing socks around the globe. Steve is a highly skilled logistics professional, but due to the time involved in planning ships across the ocean, consulting with customs at the port, and negotiating with indepen- dent owner-operators, his role is now the bottleneck preventing AmazingSocks from scaling up to meet the Christmas rush and have a record Q4. Now management needs to hire a second Steve, which will push logistics to over 12% of sock company’s payroll. ShipChain can help. Using ShipChain Web, Steve can fill the role of a mega shipping broker, using our advanced interface to search and filter compatible sea freight, customs agents, and schedule handoffs between multiple drivers. He can quickly find and match any combination of drivers and freighters to meet his needs based on pricing, speed or freight class – or he can request bids from operators not on PAGE 15

the marketplace. Once Steve is satisfied with all the data available on the website in front of him, he clicks “Create Contract And Pay”, charging the company credit card and placing the full manifest on the blockchain. Now one Steve can do the job of four, moving more socks faster and eating dinner with his family instead of waiting on hold. INTRO The Freelance Freight Broker A co-op of a dozen owner-operators in the southeast has grouped together to handle booking and coordination of freight amongst themselves, eschewing carrier. After several years of informally calling ECOSYSTEM one another to ask about availability and scheduling, a broken leg accident took Alice off the road, and she began organizing handoffs from a hotel room in Atlanta. Having her as a broker was quickly decided to be a crucial improvement to their partnership. Today, Alice uses ShipChain to manage her associates’ hauls. She can oversee all the drivers in her co- PLAN op, match new work to the best available drivers, and she always has access to compliance and regula- tory paperwork whenever necessary. Everybody knows where they’re going and what they are hauling. If there’s a problem with a driver, or they need to schedule time off, Alice can find supplemental trusted drivers in the ShipChain marketplace to fill in the gaps or take over a route. Even better, Alice is now able to identify problems in the team by insights into historical data, and can help encourage everyone to drive safer and slower, not only to extend their lifespan but also to maximize profitability from the ShipChain Safe Driving Rewards. The Clever Mega-Broker Box2U is one of the leading European shipping brokers, they deal with hundreds of carriers that man- age thousands of drivers, delivering millions of containers (worth billions of dollars) each year. Aware of shrinking margins, obligations to customers demanding faster and cheaper deliveries, and the prob- lems inherent with the tracking systems used by many of their partners, Box2U began development on an advanced Web 2.0 platform for shippers to keep better track of their assets. The bad news? They started building it 4 years ago, and today the system is only barely ready to use. Drivers and carriers aren’t voluntarily submitting accurate data, and the whole project seems like a dead end and sunk cost. Box2U knows it is not a software company. After sinking millions of dollars into a problem that is rap- idly proving to be out-of-scope for their business model, management notices a use-case just like this described on the ShipChain website. The ShipChain API is a fast, cheap and secure ledger for storing all their shipment data, plus trustless escrow contracts and ELD integrations – it’s everything Box2U has been trying to build and more. Since the whole system is built using blockchain technology in a free and open manner, even a competitor like Box2U is able leverage ShipChain technologies to power their own branded interface for managing freight. PAGE 16

TEAM John Monarch - Chief Executive Officer INTRO John is the founder and CEO of Direct Outbound, one of the fastest growing fulfillment/3PL companies in the country, and one of the largest in the Southeast United States. He is intimately familiar with the logistics industry in all aspects, from postal logistics and parcel private carriers to air, sea, and intermodal land ECOSYSTEM freight. Lee Bailey - Chief Technical Officer Full-stack developer, blockchain consultant and entrepreneur for 11 years. Lee has PLAN experience architecting, securing and deploying distributed processing systems, in- cluding analytics toolsets for high budget advertising agencies, smart contracts for a variety of decentralized applications, and a high speed cryptocurrency trading plat- form. Brian D. Evans - Chief Marketing Officer Brian is an Inc. 500 Entrepreneur, the founder of the 25th fastest growing advertis- ing and marketing agency in America, and the founder of Brian has spent over 15 years in online advertising and directly helped multiple top-10 apps acquire millions of users. He was ranked as one of the top influencers in the world on Forbes, and as the 4th most influential business journalist in the world with columns on Inc, Huffington Post, Influencive, and Forbes, which are read by millions monthly. Sam Rusani - Chief Revenue Officer As a serial entrepreneur, blockchain advocate/investor, and talent manager, Sam has worked with some of the biggest brands in the world, such as Sony, Fender, Virgin, Universal Music, Ogilvy, Heineken, VISA, and Mercedes. He has also advised interna- tional companies and negotiated trade deals on their behalf. Roger Crook - Chief Strategy Officer Roger is the former CEO, and Global Head of Sales and e-Commerce at DHL Global Forwarding. He is an entrepreneur, disruptor and independent strategist in FinTech, LogisticsTech, and Logistics including blockchain/cryptocurrencies. He was employed in the Deutsche Post DHL Group since 1988 and has successfully worked in North and South America, Europe, Middle East, Africa and Asia. Roger was the innovator behind many important customers and business units at DHL. He is also currently the CEO of Capital Springboard. PAGE PAGE1717

Magnus Dufwa - Lead Developer, EU Magnus is a senior C#, SQL and Solidity developer with over 18 years experience developing enterprise projects. He has built and managed financial processing systems that handle more than 4 million transactions per year and developed INTRO smart contracts for ad auction projects and ICOs. Clinton Senkow - VP of Partnerships ECOSYSTEM Clinton is the co-founder & COO of Influencive, a media outlet that attracts mil- lions of readers every month. He’s held top roles in partnerships, sales, and mar- keting at various funded startups where he worked with private, public, and For- tune 100 companies. He is also a former financial advisor and a two-time member of the G20 Young Entrepreneurs Alliance, representing Canada. PLAN Julian Zegelman - Legal Counsel Julian is a corporate attorney and a SuperLawyers® award recipient. He co-found- ed Rolith, Inc., and is currently a Managing Partner at Velton Zegelman PC, a bou- tique corporate and securities law firm with worldwide offices. Julian’s practice focuses on corporate law, securities, VC, and cryptocurrency law. He counsels numerous high-profile token sales and is also a co-founder of BitFin Capital, a blockchain focused VC fund. Dallas Meier- VP of Operations Dallas comes from the marketing and advertising world, where she handled dig- ital marketing for Skechers, and operations for the Los Angeles based agency Modus Operandi. Cherie Aimée - VP of Community Management Cherie is a social media strategy advisor, entrepreneur, and former tech CEO. She has over 15 years experience in digital marketing as a lead developer and project manager for startups. She has built and managed projects for some of the biggest brands in the world such as Unilever, Mars, and Heineken. Cherie currently sits on the Executive Advisory Council for the Board of Directors, Columbia University Medical Center. She is also VIP Partner to Influencive and Contributor to Thrive Global. PAGE 18

ADVISORS To modernize one of the largest industries on the planet, we have recruited a hands-on advisory board INTRO who will actively contribute their expertise along with our core team members. ECOSYSTEM Chris Perdue Chris is a 4th generation family owner and spokesperson for Perdue Farms, and the Director of Inventory Management at Perdue Agribusiness. Perdue Agribusi- ness ranks among the top grain companies in the United States, with annual sales in excess of $6 billion. Chris has funded and advised a variety of startups, and spent nearly a decade in the Advertising and Marketing industries. PLAN Kevin Harrington Kevin is the inventor of the infomercial, original Shark on Shark Tank, and pio- neer of the ‘As Seen On TV’ industry. He has launched over 500 products, result- ing in more than $5 Billion in sales worldwide with iconic brands. Kevin is also a co-founder of EO (Entrepreneurs Organization), and currently operates a private consulting firm where he helps companies increase distribution, analyze oppor- tunities, build celebrity relationships, and effectively market across all channels. Al Pettenato Al is a change-minded leader with proven success in driving best practices across all areas of the supply chain. He has been the Vice President of XPO Logistics since 2012. Al previously served as the Senior Vice President of North America for DHL, and was also the Co-founder and Vice President of AMP Global Services. He has over 20 years of diverse management experience. Steve Schoch Steve is a proven finance and operations leader for major corporations. He for- merly served as the concurrent CEO and CFO of Miramax Films for five years, through January 2017. Prior to joining Miramax, he served as the Corporate Con- troller and divisional CFO at Amgen, Inc., the world’s largest biotech company, where he drove revenue from $4bn to over $15bn. Steve also previously served as CFO of eToys, Inc., leading the company to a successful IPO. PAGE PAGE1919

David McCarville David is an attorney with prior professional experience managing multi-modal international shipments of nuclear material and sensitive cargo, such as planning transportation and disposal of nuclear waste for the U.S. Department of Energy’s INTRO Yucca Mountain Project. He has worked in the logistics and transportation Indus- try in Washington, D.C., Nevada, and Arizona. ECOSYSTEM Brandon T. Adams Brandon is a motivational speaker and serial entrepreneur, owning a stake in a number of businesses. He is Co-Host and one of two Executive Producers of Am- bitious Adventures, recently nominated for an Emmy Award. Brandon is the V.P. of Business Development and an Associate Producer for Think and Grow Rich: The PLAN Movie. Brandon is a crowdfunding, branding, PR, and digital marketing expert. Bryan Larkin, Bryan is a results-driven professional with extensive experience in both Systems and Network Security, Intrusion Detection, DDoS and Active Threat Response Mitigation. He is the Co-Founder of Faction One, a “Cyber Bodyguard” service for VIP’s and individuals that are considered “Digital High Value Targets.” David Andre David is a scientist, inventor, and entrepreneur whose work emphasizes the role of machine learning. He co-founded Cerebellum Capital, Inc., where he serves as CEO and CTO. David also advises early-stage companies, especially with respect to artificial intelligence. He has a B.S. in Symbolic Systems from Stanford Univer- sity, and a Ph.D. in EECS with a focus on Artificial Intelligence from U.C. Berkeley. Justin Wu Justin is an Information Architect & Growth marketer that has worked with com- panies such as The Wall Street Journal, Samsung, NASA, and Intel. He is also the founder of Growthly, a growth agency that helps companies build a community around their brand. PAGE 20

Fred Von Graf Fred is a seasoned technology expert who has managed mission critical applica- tions and global teams at a fortune 50 company, led business development at a fortune 20, and founded the ASU Startup Accelerator. He is also the founder of INTRO the very successful software development firm. ECOSYSTEM Joel Comm Joel is an Internet pioneer, New York Times best-selling author, professional key- note speaker, social media marketing strategist, technologist, brand influencer, and futurist. He has more than two decades of experience harnessing the power of the web. Joel’s fascination with cryptocurrency led him to create a top 100 PLAN business podcast with marketing technologist Travis Wright. Travis Wright Travis is a top marketing technology strategist, author, consultant, keynote speak- er, blockchain entrepreneur, data & analytics geek, tech journalist, and growth hacker. He is the former global digital and social strategist at Symantec for the Norton brand. He was a Russian linguist in the US Army Intelligence. Wright is the cofounder & CMO of CCP.Digital, a digital ad & content agency. Travis cohosts a top ranked blockchain podcast, The Bad Crypto Podcast, and VentureBeat’s podcast, VB Engage. Irish McIntyre Irish is a technology veteran with over two decades of Product Management ex- pertise in collaboration, CRM, information security, and taxation software. As VP of Product Management for Thomson Reuters, Irish leads the product team re- sponsible for the ONESOURCE software suite used by Fortune 500 corporations and the Big-4 accounting firms worldwide, spanning global direct taxes, indirect taxes, and global trade management. Xavier Kochhar Xavier is a structured data and AI expert. He is the Founder of The Video Genome Project (acquired by Hulu), the personalization engine and largest and most gran- ular structured database of video content metadata. Prior to The VGP, Xavier was Managing Partner at MediaLink, where he helped build the firm into the leading advisory services company in media, advertising, and technology. He was also a senior executive at The Walt Disney Company, the William Morris Agency, and L.E.K. Consulting. PAGE PAGE2121

Justin Garcia Justin is a blockchain project consultant and crypto market analyst. He has over 12 INTRO years of experience in the field of eCommerce, digital marketing, and consulting, with expertise in the importing of goods, digital product marketing, and branding. He has a long history of organizing and guiding development and design teams to build successful businesses around imports of electronics and textile products from ECOSYSTEM multiple regions overseas. Jesse Tevelow Jesse is a two-time bestselling author, and the co-founder of LaunchTeam, a com- pany that manages marketing campaigns for 7, 8, and 9-figure entrepreneurs. Pri- PLAN or to founding Launchteam, Jesse went through the inaugural class of Techstars and co-founded a game company that leveraged digital currencies to generate millions of dollars in annual revenues. Simon Bogdanowicz Simon is a blockchain investor, growth stock investor, and the co-founder of LaunchTeam. He’s worked with Fortune 500 companies across a number of industries, including Netflix, UnitedHealth Group, FedEx, Office Depot, Viacom, World Fuel Services, and Raymond James. Simon also worked as a top-tier M&A investment banker for the Royal Bank of Canada. PAGE 22

PARTNERS INTRO ECOSYSTEM Perdue Farms Perdue Farms is the parent company of Perdue Foods and Perdue AgriBusiness, based in Salisbury, Maryland. Perdue Foods is a major chicken, turkey, and pork processing company in the United PLAN States. Perdue AgriBusiness ranks among the top United States grain companies. Annual sales ex- ceed $6 billion. ShipChain and Perdue Farms will work on a pilot project to implement blockchain technology through key parts of Perdue Farms’ supply chain. Direct Outbound Direct Outbound Services LLC, is a full service warehousing and fulfillment center headquartered in Greenville, SC. Founded in 2012, the focus is to affordably increase the quality of care for clients. Direct Outbound’s focuses include E-commerce, Healthcare, Government, direct to consumer, B2B, retail, and industrial third party logistics services. Direct Outbound has grown into several hundred thousand square feet of warehousing space, ships hundreds of thousands of e-commerce and retail packages per month, and assists numerous government agencies with their shipping and bulk mail needs. Influencive Influencive is a media outlet read by millions of millennials every month, focusing on unconventional thinking, entrepreneurship, marketing, and blockchain. It was recognized by Forbes as “a rapidly grow- ing media empire,” and is “one of the fastest growing online publications for millennial entrepreneurs,” according to the Huffington Post. PAGE PAGE2323

INTRO Sweetbridge Sweetbridge sponsors the development of blockchain-based economic protocols and applications to transform high-friction global supply chains into Liquid Value Networks. The Swiss-based non-profit ECOSYSTEM foundation is gathering interested industry technologists, blockchain projects, and open-source con- tributors from around the world to form a blockchain alliance. The shared goal is to transform brittle, industrial-era commerce through decentralized industry ecosystems that create a faster, more fair value exchange, unleash working capital, better utilize resources, and optimize talent for the benefit of all participants. PLAN BiTA (Blockchain in Trucking Alliance) BiTA was formed by technology and transportation executives to develop common standards around blockchain applications in the freight industry. The alliance also promotes education of blockchain tech- nologies and offers a platform for collaboration among influential entities. BiTA’s goal is to bring togeth- er leading companies in the freight technology industries that have a vested interest in the development of blockchain technology. BiTA members include UPS, FedEx, C.H. Robinson, Coyote, Bridgestone, and others. Crypto Valley The Crypto Valley Association is an independent, government-supported organization located in the Swiss canton of Zug. Their mission is to build the world’s leading ecosystem for blockchain and cryp- tographic technologies in Switzerland. Crypto Valley’s main focus is in developing and executing a community-driven program targeted at establishing and growing their ecosystem. Crypto Valley is also working to be a bridge between Crypto Valley and the global cryptographic technologies community – building on their already active connections to international centers of blockchain innovation in London, Singapore, Silicon Valley, and New York. PAGE 24

FUNDING & BUDGET We are committed to spending our funding responsibly. Below are our plans for properly allocating INTRO the assets to deliver the best possible solutions, as quickly as possible. We are limiting the total con- tributions in the crowdfunding to $30 million USD because we feel taking more money would not be responsible and wouldn’t lead to a better product any faster. Below is a preview of our best estimates of what we’ll do with any money we raise in the TGE. ECOSYSTEM Research and Development ShipChain will be at the cutting edge of blockchain technology, including a full development team for Solidity, as well as our web platform for UI/UX, Frontend, and Backend. We will also bring on hardware and IoT developers to further advance the amount of data that can be tracked. Research into sidechain PLAN tech will be done, and the team will consider the acquisition of an existing logistics/trucking company in order to accelerate both the physical development and adoption of the platform. Operations Operations and development teams will begin within the United States, but also to support the Perdue pilot program, South America, as well as Asia and Europe to further partner with additional carriers. Support teams to operate hardware and troubleshoot issues will be necessary, and field integrations with legacy systems. Cloud and server infrastructure will be necessary with the web platform. Marketing Strategy The ShipChain Foundation is forming alliances in the logistics space with large corporations, small busi- nesses, freight companies, truckers, brand evangelists and other partners, much like the Enterprise Ethereum Alliance did for Ethereum and corporate partnerships. This initiative is an important piece of our strategy, not only from a marketing perspective, but to bolster widespread support of the ecosystem we’re building. In the coming months, ShipChain will announce partnerships that will support this effort. ShipChain’s core team and advisors have a combined century of experience in marketing and public relations, many with decades of history advertising for large brands and social media influencers. The team is uniquely equipped, both directly and through relationships, to execute marketing campaigns that will spread our message and secure our brand as a dominant player in the shipping space. Ship- Chain will advertise on relevant platforms to reach the right people in the shipping and logistics industry. We will handle P.R. and communications both internally and via 3rd parties, keeping our community constantly updated about developments, initiatives, and new relationships. Our communications strat- egy consists of press and marketing, but also community engagement through our core team. PAGE PAGE2525

Business Development We will attend both US-based and international conferences to build our network and find new leads. We’ll focus more on private 1-on-1 development with US transportation firms. ShipChain will host edu- cational evenings in different cities to attract local business owners and invite them to join our platform. INTRO We will also focus on finding strategic partners internationally, both on a corporate and a political level for quicker implementation and mass adoption. We will have team members on both coasts of the U.S. ECOSYSTEM To maximize our business development on top of all other efforts, we will also hire at least one team member in Europe to cover a larger geographical area. The team will be able to cover conferences all over the world, meet with more potential strategic partners and customers, and build more relation- ships. PLAN Legal Legal is an important aspect for ShipChain. We will retain outside counsel with extensive experience in the transportation industry to begin developing framework for best practices and compliance. Expanding ShipChain Intellectual Property portfolio as well as the acquisition of key technologies is pivotal. We will retain counsel for Food Safety and Modernization Act review and create proposals for approaching key partners in the industry. We will work with strategic partners to encourage government and administrative bodies to utilize the platform for Proof of Concept testing. Retaining key personnel to work with the Food and Drug Administration to encourage adoption of blockchain technology is an additional step we will take. We will also continue to develop strategic part- nerships with domestic and international partners to help with the proliferation of the platform at both the government and corporate level. Eventually, we will hire a dedicated lobbyist to encourage adoption of the platform as the industry standard and overall proliferation of blockchain. We will develop additional license agreements for the platform as well. PAGE 26

REVENUE MODEL ShipChain will employ a two-fold revenue model, focusing on both the Small and Mid-size Business INTRO market (SMB), as well as Enterprise platform development. This includes the following: ShipChain Web ECOSYSTEM ShipChain’s web platform will enable shippers to connect directly to carriers, without the traditional bro- kerage model. Fees will be a low percentage of the cost of shipping, and ShipChain will avoid having to hire typical telemarketing brokers, keeping the cost of selling at a minimum. This base percentage fee will be the primary income source for ShipChain Web, followed by partnerships for Cargo Insurance, as well as partner value-add services upsold on top of shipments. With a transparent fee system, Ship- Chain will show shippers the actual cost from the carrier, and how much they save versus the traditional PLAN brokerage model. Instant booking will be done, versus the traditional 3-4 day wait period. ShipChain Enterprise ShipChain will also develop custom sidechain solutions for large enterprises that need to utilize different data sources and information. ShipChain will do this as a development contractor, with all new side- chains still tying into the main blockchain. This will be custom quoted per client, but will be on the scale of large ERP implementations that routinely run over seven figures. PAGE PAGE2727

ROADMAP INTRO Q4: 2017 Platform under development as of Nov. 2017. Wide-reaching press and marketing ECOSYSTEM Q1: 2018 campaign (underway.) Token Generation Event pre-sale (complete). Token Generation Event main-sale (Canceled.) Tokens are distributed. Our freight-tracking pilot program with Perdue Farms rolls out. Q2: 2018 PLAN The initial Track & Trace platform is integrat- ed with government-mandated ELD devices. Q3: 2018 Testing of ShipChain’s decentralized broker- age Web Platform begins. Application devel- opment on ShipChain’s open ecosystem is promoted to partners. Q4: 2018 Track & Trace platform allows carriers to de- velop their own sidechains. The first version Q1/Q2: 2019 of the ShipChain Web platform is released. Our pilot program is extended into integrat- Development of custom sidechains for large ed supply-chain testing. carriers on the Track & Trace platform begins. The ShipChain Web platform is integrated with external data sources and additional Q3: 2019 A small carrier is acquired for internal testing carriers. to accelerate the adoption and development Q4: 2019 of our Track & Trace platform. International partnerships are developed to focus on ex- Relationships are established with govern- pansion into global sea freight. ment regulators to cement ShipChain as the favored tracking technology vendor, and en- hance ELD compliance. Air and sea freight Q1: 2020 Community open source projects are spon- pilot programs are initiated. sored to accelerate application development on the ShipChain blockchain. Extensive cus- tom sidechain research is conducted for 3PLs and large shippers with internal fleets. PAGE 28

FUTURE DEVELOPMENTS Self-Driving Vehicles INTRO The self-driving revolution is coming, and ShipChain will be prepared for it. Currently, drivers facilitate the handoff and delivery of loads, allowing for a carrier-level security verification at each event. We propose a novel method for preventing cargo theft or mishandling is a combination of RFID tagging, 2D barcoding, plus cargo trailer sensors that communicate with the blockchain. The unauthorized un- ECOSYSTEM loading of cargo by receivers will be noted and combined with the geographical data. This information will be publicly verifiable. This method holds receiving and shipping parties accountable for any mis- handled, lost or stolen goods. Transparency PLAN ShipChain plans to significantly increase the level of transparency in the blockchain space. With com- munity managers working with supporters in public chat and forums, our team also plans to release scheduled quarterly progress reports detailing software development progress, as well as progress on all plans detailed in this whitepaper. These quarterly progress reports will be scheduled after the initial token sale, and include statements from the development team, statements from the operations team, executive overviews, updated timetables, and other pertinent information to the progress of the Ship- Chain project. Support of a Common Goal ShipChain plans to support and encourage a better environmental policy in the freight industry. We strongly support a shift away from heavy polluting “bunker fuel” in sea freight to cleaner natural gas or even electric container ships, the encouragement of freight rail for its high efficiency, the use of fuel economy improving technology and gamification of fuel efficiency in the trucking industry, and the use of AI to reduce fuel usage. Protecting our environment is critical, and the freight industry should con- stantly work to improve its carbon footprint. Learn more by visiting Questions or comments? Email us at [email protected] PAGE PAGE2929