The BIP is a co-investment structure that allows qualified real estate owners to gain bitcoin exposure without selling their property, taking on traditional debt, or having to make a monthly payment.

Sovana deploys capital into bitcoin (specifically, shares of the iShares Bitcoin Trust ETF (IBIT)) through an isolated joint venture with the property owner. At exit:

• The capital partner receives their full principal back plus 70% of any bitcoin appreciation
• The property owner retains 30% of appreciation and provides their real estate as collateral securing the capital partner's principal

In the event where the bitcoin investment has declined in value, the property owner is required to cover the shortfall.

Direct capital partners in the BIP are typically high net worth individuals, family offices, and institutional investors seeking bitcoin upside with meaningful downside protection. All capital partners must be accredited investors.

The program is particularly compelling for real estate investors who understand secured lending, as the protection mechanics mirror a well-underwritten secured mortgage position, except with bitcoin as the asset being financed rather than property improvement.

Bitcoin-native investors will find the structure equally compelling: it is one of the few ways to gain leveraged bitcoin upside with institutional-grade real estate collateral protecting the downside.

Each position has a maximum term of five years. The property owner may elect to exit at any time; there is no minimum hold period.

Upon exit, Sovana liquidates the IBIT position and distributes proceeds:

• First, full return of capital partner principal
• Then 70% of any appreciation to the capital partner and 30% to the property owner

All proceeds are paid in U.S. dollars. If IBIT has not appreciated, the capital partner receives their full principal back with no loss and no upside participation.

The capital partner's principal is secured by a legally enforceable, institutionally structured, multi-layer security package that mirrors the protections used by some of the largest real estate credit programs in the country. There are three independent layers:

• Recorded real estate lien — a mortgage or deed of trust placed on the property owner's investment real estate at closing, insured by First American Title Insurance Company. This gives the capital partner the same legal standing as any recognized secured mortgage holder.
• IBIT held at Charles Schwab — every dollar deployed is simultaneously held as IBIT within the isolated joint venture, creating a second independent pool of collateral.
• Unconditional personal guarantee — the property owner executes primary obligor language, meaning Sovana can proceed directly against the guarantor personally without first exhausting remedies against the property.

Together, these three layers create a security structure that is title-insured, institutionally benchmarked, and designed to be enforceable in every state.

At closing, the capital commitment does not exceed 70% of the independently validated real estate value. Every dollar deployed is simultaneously held as IBIT within the joint venture at Schwab, resulting in a combined loan-to-value ratio below 42% across both collateral pools.

To put that in concrete terms: in a scenario where real estate declines 30% and bitcoin declines 70% simultaneously, the real estate collateral alone still covers 100% of the capital partner's position with a meaningful cushion remaining.

A loss scenario requires a simultaneous decline of approximately 60% across both asset classes at the same time. We view this as a highly implausible combination, particularly given that our counterparties are low-leveraged accredited investors on stabilized investment real estate who have strong economic incentive to protect their own equity.

We apply the same valuation standard used by institutional mortgage lenders and rating agencies for rated securitizations. Specifically, we only accept Automated Valuation Models (AVMs) that meet Fitch Ratings' published confidence score thresholds — the standard Fitch requires before accepting an AVM in a rated securitization. This is not an internal standard we invented; it is the highest publicly published AVM confidence benchmark in the market.

All AVMs are processed through Mercury Network, the market standard platform used by nearly 1,000 lenders and AMCs nationwide, and every AVM is accompanied by a third party physical inspection report confirming property condition and habitability.

Where no AVM meets the Fitch confidence threshold, we order a full appraisal through a licensed Appraisal Management Company. The result is a valuation process that is independent, institutionally benchmarked, and verifiable.

The core protection mechanics — a secured real estate lien, title insurance, personal guaranty, and low LTV underwriting — are the same building blocks that have underpinned billions of dollars of institutional real estate credit for decades.

More specifically, the secured 2nd lien structure has been validated at institutional scale through the Home Equity Investment (HEI) industry, which has originated and securitized billions of dollars of similar lien-secured positions reviewed and accepted by rating agencies, institutional investors, and regulators.

Our structure is modeled on those same proven mechanics; in fact, ours is materially more conservative. HEI products typically target primary residences at higher leverage points with lower-income counterparties. Sovana targets investment real estate, accredited investors only, at a combined LTV below 42%. The protection is not new. The bitcoin upside is.

If bitcoin declines to zero, your principal is recoverable from the real estate collateral. At a maximum 70% LTV on the real estate value alone, the property would need to simultaneously lose more than 30% of its independently validated value for you to experience any shortfall. In that scenario, the personal guaranty provides a third line of recourse against the property owner individually.

Beyond the math, consider the economics: our counterparties are accredited investors holding substantial equity in stabilized investment real estate. A default on our position would simultaneously trigger a default on any senior mortgage, destroying far more equity than the cost of simply curing or refinancing. The structural incentives strongly favor resolution over default.

Every transaction includes an unconditional, irrevocable personal guarantee from the property owner covering full return of principal. It is primary obligor language — Sovana can proceed directly against the guarantor without first exhausting property remedies.

The guarantee survives bankruptcy and is not affected by any modification or release of collateral. Any attempt to challenge, impair, or circumvent the lien or enforcement rights triggers full personal recourse with no property limitation immediately. This is not a standard bad-boy carveout; it is a comprehensive personal guarantee structured to be enforceable in every scenario that matters.

Every BIP position is a standalone Delaware LLC joint venture between the capital partner and the property owner, with Sovana as Administrative Agent. There is no cross-collateralization — a problem in one position has zero effect on any other.

IBIT shares are held within each JV entity at Charles Schwab under Sovana's sole control. Legal ownership of all IBIT and related assets is vested in the JV entity itself, not in Sovana. Each position is its own ring-fenced vehicle, completely isolated from Sovana's operating company and from all other BIP positions.

Your position remains fully intact. Each JV is a standalone legal entity that exists and operates independently of Sovana's corporate existence. The Joint Venture Operating Agreement explicitly provides for appointment of a qualified third party administrator if Sovana is unable to serve.

Your recorded lien is insured by First American Title and enforceable independently of Sovana. Sovana currently carries zero debt and has no plans to take on debt, making this scenario remote — but the structure is built so that your protection does not depend on Sovana's continued existence regardless.

Bitcoin exposure is held exclusively as IBIT within each individual JV's dedicated Charles Schwab brokerage account. Schwab is one of the world's most trusted financial custodians with over $9 trillion in client assets.

Sovana maintains sole control over each JV's Schwab account as Administrative Agent. No rehypothecation of capital partner funds occurs at any time. In an enforcement scenario, Sovana can liquidate the IBIT position to fund carrying costs and enforcement expenses without requiring additional capital from the capital partner.

We accept stabilized investment single family residential and multifamily real estate only. We do not accept:

• Primary residences
• Transitional assets
• Construction collateral
• Unstabilized properties of any kind

Every property undergoes independent valuation via Fitch-compliant AVM processed through Mercury Network or licensed appraisal, accompanied by a third party physical inspection report. We underwrite to the same standards institutional lenders apply to rated mortgage products.

The Joint Venture Operating Agreement requires the property owner to:

• Maintain the property in good condition
• Maintain property insurance without lapse, with Sovana named as additional insured and loss payee
• Pay all property taxes and assessments when due
• Keep any senior mortgage in good standing

Breach of any covenant is an immediate default triggering Sovana's full enforcement rights and default interest accrual at 10% per annum compounded monthly.

Our recorded First American-insured lien structurally prevents unauthorized senior financing — any new debt recorded after our lien is automatically junior to it, and any unauthorized transfer is insured against.

We are named as loss payee on the property insurance policy, ensuring direct notification of any lapse. Annual proof of property tax payment is required. Any lien, lapse, or encumbrance that arises constitutes an immediate default triggering our enforcement rights. First American's title insurance provides an additional institutional backstop across all of these scenarios.

We decline:

• Non-accredited investors
• Anyone with a bankruptcy within the prior seven years (verified through standard credit bureau and background search reporting)
• Anyone with a criminal background, with particular focus on financial crimes and fraud
• Overleveraged positions or properties with material title issues

Every applicant is screened through standard background and public records searches prior to closing. Our counterparties are low-leveraged accredited investors on stabilized assets — a profile that is fundamentally misaligned with default behavior.

Upon any default, Sovana has sole and absolute authority to:

• Dissolve the JV and liquidate the IBIT position
• Enforce the lien and personal guaranty, including initiating foreclosure proceedings
• Pursue any available legal or equitable remedy

The defaulting property owner loses all voting rights immediately. Default interest accrues at 10% per annum compounded monthly from the date of default until resolved. All enforcement costs are funded from the liquid IBIT position within the JV. The capital partner bears no enforcement costs.

We view default as unlikely by design. Our counterparties are accredited investors with substantial equity in stabilized real estate. A default on our position would simultaneously trigger a default on any senior mortgage, destroying far more personal equity than the cost of simply curing or refinancing.

In the unlikely event of a prolonged enforcement scenario, our position accrues at 10% per annum compounded monthly on a fully collateralized basis — time works in our favor. Carrying costs during any enforcement period are funded from the liquid IBIT within the JV. We are not a margin facility that can be forced to liquidate at distressed prices. We hold, accrue, and enforce from a position of strength.

Each BIP position is a standalone isolated Delaware LLC. If a property owner files personal bankruptcy, the automatic stay temporarily delays foreclosure proceedings but does not impair our recorded lien or its priority.

We continue accruing default interest at 10% per annum compounded monthly during any stay period, with all costs funded from the liquid IBIT position within the JV. The capital partner bears no costs during this period. Sovana's own financial position is isolated from any individual position, and each JV remains valid and enforceable under a third party administrator if needed.