sole discretion. Before engaging in Staking, the Sponsor expects to implement a staking policy with respect to the Trust, which describes the frequency of, and conditions under which the Trust would make such distributions, if any, to the Trust’s beneficiaries. The Sponsor would make such staking policy available to shareholders on the Sponsor’s website. Subject to any slashing risk, the Trust (through the Custodian) would maintain control and remain the record and beneficial owner of the staked tokens at all times, and the tokens would remain associated with the Trust’s wallet. To the extent that the Staking Condition is satisfied and Staking is implemented, the Sponsor anticipates that the Custodian and the Staking Provider would be entitled to receive a portion of the gross Native Staking Consideration generated under the Staking Arrangements, reflecting the Custodian’s fee and the Staking Provider’s share of such Staking Consideration, with the remainder received by the Trust. The allocation of gross Native Staking Consideration between the Custodian and the Staking Provider shall reflect an arm’s length allocation that is independent of the expenses of both the Staking Provider and Custodian, and may be stated as a percentage of the gross Native Staking Consideration. In addition, pursuant to the Trust Agreement and as consideration for the Sponsor’s facilitation of Staking, the Sponsor would be permitted to receive a fee equal to a portion of the Native Staking Consideration, which accrues daily in U.S. dollars in an amount calculated as a per annum percentage of any Native Staking Consideration received by the Trust, as may be directed by the Sponsor in its sole discretion. The Sponsor’s Staking Fee would be payable to the Sponsor daily in arrears. See “Description of the Shares—Staking—Staking Arrangements and Provider-Facilitated Staking Model” for more information. Security and Controls The Trust’s Custodian has multiple layers of security protocols designed to protect the Trust’s assets from unauthorized access or transfer, which remain in place when the Trust’s SUI is staked. The Trust’s SUI would be staked from the Trust’s wallets and would not be transferred to any other wallet to be staked. The Sui protocol limits the activities of the Staking Provider to executing only those activities specified by the protocol, such as staking, un- staking and performing validation activities and does not enable the Staking Provider to unilaterally transfer staked assets to any wallet not specified by the Sponsor. Accordingly, the Staking Provider would not have any powers to move the Trust’s staked SUI other than at the direction of the Sponsor. In particular, the Staking Provider would not be authorized to leverage or rehypothecate the Trust’s SUI tokens. The Staking Provider would also not be able to change the designated wallet addresses on the Sui Network to which staked SUI is to be withdrawn or to which Staking Consideration shall be sent. In addition, the Staking Arrangements would not alter the Trust’s custody environment or security procedures. The controls currently in place between the Sponsor and the Custodian would also govern the activities related to staking and un-staking SUI, which would be outlined in the Staking Arrangements. See “Description of the Shares—Staking—Security and Controls” and “Risk Factors—Risk Factors Related to Staking” for more SUI is a digital asset that is created and transmitted through the operations of the peer-to-peer Sui Network, a decentralized network of computers that operates on cryptographic protocols. No single entity owns or operates the Sui Network, the infrastructure of which is collectively maintained by a decentralized user base. The Sui Network allows people to exchange tokens of value, called SUI , which are recorded on a public transaction ledger known as a blockchain. SUI can be used to pay for goods and services, including computational power on the Sui Network, or it can be converted to fiat currencies, such as the U.S. dollar, at rates determined on Digital Asset Trading Platforms (as defined herein) or in individual end-user-to-end-user transactions under a barter system. Furthermore, the Sui Network was designed to allow users to write and implement smart contracts—that is, general-purpose code that executes redundantly across the network and can instruct the transmission of information and value based on a sophisticated set of logical conditions. Using smart contracts, users can create markets, store registries of debts or promises, represent the ownership of property, move funds in accordance with conditional instructions and create digital assets other than SUI on the Sui Network. Smart contract operations are executed on the Sui Network in exchange for payment of SUI. Like the Ethereum Network, the Sui Network is one of a number of projects intended to expand blockchain use beyond just a peer-to-peer money system. The price of SUI on public Digital Asset Trading Platforms has a limited history, and during this history, SUI prices on the Digital Asset Markets more generally, and on Digital Asset Trading Platforms individually, have been volatile and subject to influence by many factors, including operational interruptions. While the Index is designed to limit exposure to the interruption of individual Digital Asset Trading Platforms, the Index Price, and the price of SUI generally, remains subject to volatility experienced by Digital Asset Trading Platforms, and such volatility could adversely affect the value of the Shares. For example, from January 1, 2025 through December 31, 2025, the Index Price ranged from $1.33 to $5.23, with the straight average being $3.02. See “Business—Overview of the Sui Industry and Market—Historical NAV and SUI Prices.” information. Sui History
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