AXUSD Whitepaper Summary

AXUSD Stablecoin Whitepaper Summary

Issued by AX Coin (Bahrain) B.S.C

Important Notice

This document is a summary of the AXUSD Stablecoin Whitepaper (the "Whitepaper"). It should be read only as an introduction to the full Whitepaper.

This summary does not contain all of the information relevant to a decision to purchase AXUSD. Clients should base their decision to purchase AXUSD on the content of the Whitepaper as a whole, and not on this summary alone.

The full Whitepaper is published on the Company's website.

General Warning

A copy of the Whitepaper has been submitted to and registered with the Central Bank of Bahrain ("CBB"). The CBB's approval does not imply that the CBB has approved the suitability or appropriateness of AXUSD or the Company, or authenticated the financial, accounting, or technical information presented in the Whitepaper.

The CBB assumes no responsibility for the accuracy or completeness of the information contained in the Whitepaper and expressly disclaims any liability whatsoever for any loss arising from reliance upon the whole or any part of its contents.

1. About the Issuer

AX Coin (Bahrain) B.S.C ("AX Coin" or the "Company") is a stablecoin issuer licensed by the Central Bank of Bahrain under the Stablecoin Issuance and Offering (SIO) framework of CBB Rulebook Volume 6.

The Company is a Bahraini Closed Joint Stock Company, incorporated on 8 February 2026 and registered in Manama, Kingdom of Bahrain (Commercial Registration No. 194717-1). Its registered office is at Arcapita Building, Bahrain Fintech Bay, 3rd Floor, P.O. Box 11299, Manama, Kingdom of Bahrain.

The Company primarily serves institutional and corporate clients.

2. About AXUSD

AXUSD is a fiat-referenced digital token designed to maintain stable value relative to the United States Dollar.

AXUSD is:

• Fully backed. Every token in circulation is backed at all times by reserve assets at a ratio of at least 1:1.
• Redeemable at par. Every holder has a permanent, direct legal right to redeem AXUSD for United States Dollars at par value (face value) at any time.
• Independently audited. Reserve adequacy is confirmed each month by Grant Thornton Abdulaal, an independent external auditor approved by the CBB.

The Company may extend AXUSD to additional blockchain networks in the future, subject to applicable regulatory approvals.

3. How to Subscribe

Clients may purchase AXUSD through the Company's platform by following these steps:

1. Submit a subscription request specifying the quantity and the receiving wallet address.
2. Complete client identity verification (KYC for individuals or KYB for businesses) and applicable due diligence.
3. Transfer United States Dollars from your own bank account in your own name to the Company's designated settlement account. Third-party transfers are not accepted.
4. The Company verifies receipt of funds, performs compliance and sanctions screening, and on approval issues AXUSD to your registered wallet address.

Minimum subscription amount: USD 10,000 per request.

4. How to Redeem

Clients may redeem AXUSD for United States Dollars at any time by following these steps:

1. Submit a redemption request through the Company's platform specifying the quantity and your bank account details.
2. Send the corresponding AXUSD to the Company's designated wallet address.
3. The Company performs compliance and sanctions screening on the inbound tokens.
4. The Company verifies the received amount, then permanently destroys (burns) the tokens.
5. The Company transfers the equivalent United States Dollar amount, less any applicable fees, to your verified bank account.

Minimum redemption amount: USD 10,000 per request.

5. Your Right to Redemption

Holders of AXUSD have a permanent, direct legal right to redeem their AXUSD for United States Dollars at par value (face value) at any time.

The Company will process all legitimate redemption requests and initiate the corresponding fiat transfer within 1 to 5 business days of receiving the tokens at its designated wallet address. Banking settlement time after the Company initiates the transfer is outside the Company's control and is not included in this period.

In exceptional circumstances involving significant market disruptions beyond the Company's control, redemption processing may be delayed until normal market conditions resume.

Redemption is subject to compliance with applicable identity verification, anti-money laundering, and sanctions requirements.

Each holder has a proprietary claim against the reserve assets backing AXUSD on a pro rata basis. In the event of insufficient reserves, holders have the right to make a personal claim against the Company up to the par value of their tokens, provided they have satisfied all reasonable conditions.

If the Company discontinues operations, all holders will be notified through the Company's website, portal, and email, and will be given at least one (1) month to redeem their AXUSD at par value.

6. Fees and Charges

The Company applies the following fees on the gross amount of each request:

• Subscription fee: 0.00%
• Redemption fee: 0.00%

Third-party costs incurred in connection with a subscription or redemption (including bank charges, correspondent bank charges, FX spreads, and blockchain network fees) are recovered from the client at cost, without any markup by the Company.

All fees, applicable minimum amounts, and any known third-party costs are disclosed to the client before a subscription or redemption request is confirmed. The Company's full fee schedule is published on the Company's website and is reviewed periodically.

Fees will not be set at a level that would discourage holders from exercising their right to redeem AXUSD.

7. Yield

AXUSD does not pay yield, interest, or any periodic return to holders. Income earned on the reserve assets accrues to the Company.

8. How Your Tokens Are Backed

AXUSD is backed at a minimum ratio of 1:1 at all times by high-quality, easily convertible reserve assets. Eligible reserve assets are limited to:

• Cash and bank deposits callable at one day's notice;
• Debt securities issued by the central bank of the reference currency with a residual maturity of 90 days or less;
• Repurchase agreements with a maturity of 7 days or less, backed by eligible central bank debt securities; and
• Short-term government money market funds.

No corporate bonds, equities, crypto assets, commercial paper, or instruments with a maturity exceeding 90 days are held in the reserve.

Reserve assets are valued every business day. Reserve assets are held in trust for AXUSD holders, in segregated accounts with licensed custodian banks in the Kingdom of Bahrain, entirely separate from the Company's own operating funds.

If reserve assets fall below the face value of AXUSD in circulation, the Company will replenish the shortfall from its own assets within one (1) business day.

Monthly independent audit reports confirming 100% reserve backing are published on the Company's website.

9. Key Risks

Before acquiring AXUSD, clients should carefully consider the following risks. A more comprehensive discussion of risks is included in the full Whitepaper.

• Market and liquidity risk. Although AXUSD is designed to maintain a 1:1 peg to the United States Dollar, secondary market prices on third-party trading venues may temporarily deviate from par. Liquidity on any trading venue is not guaranteed and the Company does not guarantee that AXUSD will be listed on any particular venue.
• Counterparty risk. The Company relies on third-party providers for custody, banking, and compliance services. A failure, breach, or disruption at any of these providers could affect the Company's services.
• Reserve asset risk. Reserve assets are not covered by any government deposit insurance scheme. Their value may be affected by counterparty default at a custodian bank, regulatory action, or extraordinary market events.
• Technology and operational risk. Blockchain technology involves risks including software vulnerabilities, network congestion, protocol changes, and smart contract risk. Although the underlying token standard has been audited by an independent third party, no audit eliminates all risk. Transactions on public blockchains are irreversible, and tokens sent to incorrect addresses may be permanently lost.
• Blockchain network risk. The blockchain networks on which AXUSD is issued are public, decentralised networks outside the Company's control. The Company cannot prevent network-level disruptions, forks, or attacks. Network congestion may delay transaction confirmation.
• Cybersecurity risk. Holders should protect their own devices, credentials, and wallet keys against phishing, malware, and other cyber threats. The Company cannot protect against compromises of holders' own devices or credentials.
• Regulatory and legal risk. The legal status and regulatory treatment of stablecoins vary across jurisdictions and may change. Holders are responsible for understanding and complying with the laws of their own jurisdiction, including tax obligations.
• Redemption risk. Redemption may be delayed during significant market disruptions beyond the Company's control. Redemption requires compliance with identity verification and AML requirements; holders who do not satisfy these requirements may be unable to redeem.
• Other risks. Digital token technology is evolving. Risks not currently anticipated may emerge.

10. Your Obligations

By holding or using AXUSD, holders agree to:

• comply with all applicable laws, including anti-money laundering, counter-terrorist financing, anti-corruption, and sanctions laws;
• not use AXUSD for any illegal activity;
• provide accurate and complete identity verification information when required;
• secure their own wallets, private keys, and credentials. Loss or theft of AXUSD due to compromised wallet security is the holder's responsibility; and
• comply with the Company's Terms and Conditions and any amendments made by the Company with reasonable prior notice.

11. Complaints

Clients may submit complaints to the Company through the contact channels published on the Company's website. The Company will acknowledge written complaints in writing within five (5) working days of receipt and will issue a substantive response within four (4) weeks. If the Company is unable to respond within four (4) weeks, it will provide an explanation and an indicative date by which a response will be issued.

If a complainant is not satisfied with the Company's response, they have the right to escalate the complaint to the Central Bank of Bahrain Consumer Protection Unit within thirty (30) calendar days of receiving the Company's response:

• Mailing address: Central Bank of Bahrain, King Faisal Highway, Diplomatic Area, P.O. Box 27, Manama, Kingdom of Bahrain
• Website: www.cbb.gov.bh
• Telephone: \+973 17 547 789

The Company's full complaint handling procedures are set out in the Complaints Notice published on the Company's website.

12. Applicable Law

The Company is governed by the laws of the Kingdom of Bahrain, including Legislative Decree No. (64) of 2006 with respect to the Central Bank of Bahrain and Financial Institutions Law, and the directives and rulebooks issued by the Central Bank of Bahrain.

Any dispute will first be addressed through good-faith consultation between the parties. If no resolution is reached within thirty (30) days, the dispute will be referred to and finally resolved by arbitration administered by the Bahrain Chamber for Dispute Resolution under its arbitration rules then in force. The seat of arbitration will be the Kingdom of Bahrain, the language of arbitration will be English, and the tribunal will consist of one (1) arbitrator. If arbitration is not agreed or is not enforceable, the competent courts of the Kingdom of Bahrain will have exclusive jurisdiction, without prejudice to the supervisory authority of the Central Bank of Bahrain.

13. Read the Full Whitepaper

This summary does not replace the full AXUSD Stablecoin Whitepaper. Clients considering the purchase of AXUSD should read the full Whitepaper before making any decision.

The full Whitepaper is available on the Company's website at axcoin.com.