# Secure

**Identify Water Sources**

The foundation will engage well owners worldwide to reach this goal but also drill our own wells. The roadmap also includes locating water sources and spreading knowledge about clean drinking water globally.

Longhouse Water150 AB will look for potential water sources globally without considering the size of the water source. The Water150 project will also identify new locations to drill for water. We will work with water charities and non-profits during the initial phase and focus on drilling in high-priority areas. Over time, we will transition to more independent drilling operations.

Water sources and their owners are important since they lay the foundation for the business model. They represent the individuals controlling the water supply from a global perspective. Well owners that become ecosystem partners will work to maintain water quality and protect the local water cycle using our protection protocol and standards: the Water quality standard.

### **The Water quality standard** <a href="#heading-h.40ew0vw" id="heading-h.40ew0vw"></a>

To maintain the quality of water sources in the Longhouse ecosystem, we have created and will enforce the Water quality standard, to ensure high quality drinking water for present and future generations. The standard clearly defines the criteria to become an approved water source. When we identify a water source, Longhouse Water150 AB will measure and control the quality and flow of the water to ensure that it meets the standards of the Water quality standard. The measurements follow the latest scientific guidelines and provide reliable proof of water quality. We will enter partnerships with owners of water sources that fulfil the conditions to become long-term partners. Longhouse Water150 AB will perform thorough and regular controls to secure water quality. We will also ensure that the water source balances and supports the natural drinking water cycle.

Well owners who meet the standards of the Water quality standard and become Longhouse ecosystem partners will receive certificates. The certificate will serve as proof for Water150 token traders and well owners that their water source is premium-quality. The standard has different requirement classes such as microbial, physical, chemical, radiological and mineral content. To ensure high quality standards, the water must fulfill the minimum requirements according to Appendix A, where the test and limitations are higher than WHO, FDA, and Swedish National Food Administration recommendations. We will regularly update the requirements list according to the latest knowledge about dangerous substances like PFAS and microplastics. Independent third-party hydrologists will audit the certification process.

All well owners must understand, accept, and meet all the seven (7) standards of the Water quality standard to enter the Longhouse ecosystem:

1. Water sources for seven generations. Water sources that enter the ecosystem will enter a commitment for at least one (1) generation. Hence, the well owner enters the partnership to stay in the ecosystem for the entire duration of the arrangement while receiving financial compensation from the Longhouse Foundation for the partnership.
2. Natural water flow filtered by biodiversity. The water source needs to have a natural water flow, where the water is filtered by nature and its biodiversity. This process preserves the beneficial properties of water and replenishes the flow over time.
3. High-quality drinking water with tapping rights. The water source needs to have a tap where high-quality, clean drinking water is easily accessible. We will accept large and small facilities as long as the water is easily accessible through modern and efficient outlets. The source will also get regular quality control tests as recommended in the Water quality standardl to ensure high-quality clean drinking water.
4. Financed upfront and legally verified. Well owners will follow the local water protection legislation. Longhouse will conduct risk assessments to ensure the well's protection in places with unclear or undefined requirements.
5. The water flow becomes water rights. The well needs to be defined and allocated in accordance with the Water quality standard to enter the Longhouse Foundation. These water rights consist of water flows, meaning that the well maintains its water flow rate every year, for perpetuity. Longhouse will use approximately 80% of the water flow available.
6. Democratized through transparency and decentralization. Every water source connected to Longhouse has to abide by the transparency and decentralization principles of the Longhouse ecosystem.. The water sources must connect to the Longhouse ecosystem through the blockchain.
7. Global initiative making water available for all humankind. The well owners should be on board with our vision to make clean drinking water accessible globally.

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The water from the wells will be regularly tested according to known international standards, as ISO, according to Appendix A. If the minimum requirements for all tests passes the well could be added to the Longhouse ecosystem. If a well is added to the ecosystem different levels of testing will be conducted on a regular basis, depending on the amount of tapped water or base requirement. The Tests will be conducted by local or centralized facilities that are accredited according to ISO 17025. These partners will contribute their expertise while acting as an independent third party that maintains standards and ensures the accuracy of reports.

If a water source (for instance, due to pollution or natural disaster) no longer fulfils the quality demands, it will be removed from the Longhouse ecosystem. We expect this to incentivize well owners to protect their water sources and the surrounding environment. Longhouse will have a buffer of water to make sure that such an incident will not affect Water150 token.

### **To secure water sources for future generations** <a href="#heading-h.2fk6b3p" id="heading-h.2fk6b3p"></a>

There are thousands and thousands of high-quality water wells around the planet. All filtered by the biodiversity of nature and secured and taken care of by their well owners. Many of the well owners experience a hard time making the water well commercially. Longhouse offers these well owners a fair income based on the regenerative water flow and by that supports their water well for the future. Longhouse will use and include the water in the Water150 project while the water well owners continue to focus on securing and sharing the best water in the world for the seven generations to come.

As securing the supply of high quality water is of key importance to the project we are establishing a department with the sole purpose of drilling, acquiring and leasing water.

Protecting water sources for future generations begins immediately when they join the Longhouse ecosystem. Water sources join the Longhouse Foundation by signing a contract containing a right of use clause extending over a long period. The Longhouse Foundation will also retain ownership of the wells it drills permanently.

Finding and signing water sources worldwide is the key to quickly and efficiently growing our franchise system. According to the right of use contract, the well owner will be responsible for the operations and maintenance. They will also decide how and how much they work on the well. They must fulfil all the requirements of the Water quality standard to be part of the Longhouse ecosystem.

One essential aspect to the success of the Water150 project is to help well owners understand their role in protecting global water resources. We created a business model that incentivizes well ownership. The incentive program for well owners involves paying them a predetermined amount of Water150 tokens and every well acquisition or well agreement will be individually negotiated. The tokens will be locked and connected to the well owner, who will receive token payments staggered over 21 years (equals one generation). After each 21-year period, the Longhouse Foundation will decide to continue with the existing agreement or halt the arrangement to use one of the new wells in the program. Besides the incentive program based on a mix of FIAT and Water150 tokens, well owners will receive a signing bonus, paid directly upon partnership agreement in Water150 tokens.

It is important to observe that most water well owners do not generate enough revenues from their water sources as per today. Therefore, an agreement where they get rewarded for their resources will be a very attractive alternative for them.

The wells that the Longhouse Foundation controls through acquisition or drilling own wells will follow the same thorough quality controls as water sources connected through rights of use partnerships. Buying water sources and drilling our water wells allows Longhouse to create water resources where it is truly needed and also where water is available. We also need to own some wells to create revenue to cover the OPEX (operating expenses) and minimize related costs, which the Longhouse Foundation needs to ensure project sustainability. Through the ownership of the drilled wells, Longhouse gets the control of the water source and therefore can make sure that the water is handled in a correct way according to the Water quality standard.

Longhouse wants to make management, operations, and administration of water sources truly distributed and decentralized. We can ensure lifelong and genuine ownership to sustain a viable business model using blockchain technology. We use blockchain and the Longhouse Foundation to avoid private and commercial actors owning too much water. The distribution of water sources throughout the planet is essential to creating a grassroots movement where we can inspire people to care about water for themselves and spread the message to others.

We mainly focus on drilling wells to reduce our OPEX, while the right of use contracts with third-party well owners focuses on creating and growing the grassroots movement, as well as enabling fast scaling of our operations and business model. Signing contracts with well owners is a faster way of acting than drilling or acquiring wells and therefore this process is important in the beginning of the project. The Longhouse Foundation can leverage the economics of scale by outsourcing water source management. An abundance of well owners also reduces the effects of unavoidably losing well owners for different reasons.

### **To manage the water wells in perpetuity** <a href="#heading-h.upglbi" id="heading-h.upglbi"></a>

The Longhouse Foundation will mint tokens as per the predefined criteria over a 150-year-period. The max supply to be 210 billion Water150 tokens. This volume of tokens will allow the project to maintain long-term sustainability and fulfil its charity commitments through the water resources from the 1 000 best water wells in the world. The efforts to acquire water wells for charity will start in the first year and continue to grow at the pace of the project’s development. The project’s DAO will help maintain and administer charitable resources to the most vulnerable populations globally.

The Longhouse ecosystem will introduce the first batch of Water150 tokens through a token generation event (TGE) to finance and develop its vision. This initial batch will facilitate blockchain involvement to secure funds for Longhouse to secure the first 5.8 billion liters of water (approximately 20-25 wells) and the organization and marketing activities involved. Upon launching the first batch, the tokens will not grant the full 1:1 access right to drinking water, and so they will be discounted accordingly. For specific numbers, see the tokenomics. When the amount of water for fulfilling the first batch reaches 5.8 billion, every Water150 token will be supported by one (1) liter of drinking water. This means that Longhouse and the community will develop the token utility together to reach its intended and sustainable level throughout the first batch. The project aims to achieve 1 to 1 coverage, where one (1) Water150 token grants access to one (1) liter of drinking water. This will take place within the first three (3) years of the TGE.

The second batch will follow the completion of the first batch and the completion comes when every Water150 token is able to access one (1) liter of water. This batch aims to create a solid global proof of concept. Longhouse will secure another 204.2 billion liters of water (approximately between 500-1000 new wells) distributed across different continents during this period. After securing new water sources, the foundation will release tokens to the market in a long-term strategic pattern. Hence, from the day the Water150 token is equal to one (1) liter of water, that relationship will be maintained perpetually. When this batch is completed and released into the market, Longhouse, the entire project, entities, and business will be 100% owned by the Longhouse DAO, without any human owner. Longhouse, per definition, will become a true DAO (Decentralized Autonomous Organization). The DAO will also manage these charitable causes and provide access to drinking water for the most vulnerable people worldwide.

Longhouse aims to have one of the big four auditors to verify the amount of water secured in the Water150 project.

### **Risk Management** <a href="#heading-h.3ep43zb" id="heading-h.3ep43zb"></a>

To ensure sufficient supply and efficient logistics, we will need many different water sources worldwide. It is also important to have a wide variety of water sources, both geographically and regarding the properties of the water source, from a risk management perspective. The geographical location is important since the water should be easily accessible. Meanwhile, the properties of the well are important for the chemical composition of the water. The chemical components affect the water’s properties and its health benefits. If a water source is susceptible to future problems, e.g., pollution or natural disasters, the Longhouse Foundation will secure alternatives and reservoirs to cover the water supply from that source. Initially, this reserve pool will be around 10% of the total reserves, but it will vary based on the actual needs.

The Longhouse Foundation wants to create a global, diversified portfolio of water sources containing the highest natural quality water. Incentivizing well owners to care for their wells per the Water quality standards is key to maintaining this standard. It will minimize the risk of losing wells to poor maintenance. Well owners are placed on a yearly token release program to motivate them. All well owners will participate in mandatory water care programs based on the Water quality standard. These programs aim to motivate well owners and give them critical information about how water and the water cycle work. We want them to be reliable local ambassadors for clean drinking water and the Water150 project.

The following matrix analyses the risk appetite for the Longhouse ecosystem in more detail:

<table data-header-hidden><thead><tr><th></th><th width="139"></th><th></th><th></th></tr></thead><tbody><tr><td><strong>Risks</strong></td><td><strong>Appetite</strong></td><td><strong>Description</strong></td><td><strong>Assessment</strong></td></tr><tr><td><strong>Water flows</strong></td><td></td><td></td><td></td></tr><tr><td>Climate and human effects on it</td><td>Low/medium</td><td>Risks like drought, fire, storm, diseases, pollution, and overuse.</td><td><p>The climate effect of the project is low since water is in a perpetual cycle. However, human activities that exhaust and pollute wells affect the process as we see it today. We created a protocol of bullet points that must be met to be admitted into the Longhouse project. We have a strong motivation to follow the protocol.</p><p>By educating people about the water situation and what happens when we act like we do today, we can raise awareness and reduce activities that cause water pollution and overuse.</p></td></tr><tr><td>Commodity price risk</td><td>Low/Medium</td><td>Commodity prices can be volatile over time and are affected by a wide range of factors</td><td>Exposure to macro-economic drivers affecting commodity prices will always be present. As it is today, water is partially subsidized to maintain its low price. As we find out the true value of water, water price will go up.</td></tr><tr><td>Liquidity/Exit risk</td><td>Low</td><td>Inability to exit if desired</td><td>Water is necessary for most life forms on earth. Water will always be desirable, especially the high-quality water that we provide.</td></tr><tr><td>Geographical risk</td><td>Medium</td><td>Legal &#x26; regulatory systems, political risks, economic systems, tax regimes, sovereign risks, social issues, business climate</td><td><p>This refers to country-specific regulations that make it impossible to establish in that region. It can happen before and after we enter the market. However, we retain the option to move to more receptive markets with fewer risks involved.</p><p>The same goes for political instability and hostile takeovers.</p></td></tr><tr><td>Water access</td><td>Low</td><td>The amount of water connected to the Longhouse system</td><td><p>Longhouse needs to recruit water sources and will do so by drilling wells and partnering with third-party well owners. The system also accommodates the recruitment of well owners and management of their resources as the system develops.</p><p>Longhouse will have a water buffer to always guarantee that the volume of water in the system equals the amount of tokens on the market. Therefore, minimizing risk.</p></td></tr><tr><td>Reputation risk</td><td>Low</td><td>Acts and investments by Longhouse could harm the reputation</td><td>The Longhouse Foundation’s purpose is clear and every decision we make is with a vision for 150 years and serving upcoming generations with water. The project lends to the statutes and ordinances of the foundation to always adhere to the primary purpose.</td></tr><tr><td>Development risk</td><td>Low/Medium</td><td>Risk of scaling up the business</td><td>Longhouse will act fast and grow rapidly and the task of establishing a global organization has already begun. The key to success is the core team and their experience in building similar organizations.</td></tr><tr><td>Management risk</td><td>Low</td><td>Ability to create a global business</td><td>The team responsible for the Longhouse project is built around knowledgeable and experienced experts in building and developing businesses in high-speed and changing environments.</td></tr><tr><td>Legal risk</td><td>Medium/High</td><td>Changing regulations affecting the business model</td><td>The crypto market is relatively immature. So, there is a risk of changing regulations globally. We stay updated on the latest trends and will be as adaptable when the need arises.</td></tr></tbody></table>

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