Vested Rewards

Rewards allocated to the following protocols incentive programs are subject to a vesting mechanism:

• Staking $HEDGE via the mHEDGE framework,

• Holding an active Position

• Providing Liquidity HEDGE/WMONAD or HEDGE/USDT

• Using a Strategy which mHEDGE voters have channeled incentives into

*NFT staking and Referral rewards are not subject to rewards vesting and are paid out in $HEDGE tokens directly as opposed to mHEDGE.

The rewards vesting mechanisms works as follows:

• Rewards are initially paid out in the form of mHEDGE, these rewards can be converted into $HEDGE anytime at a ratio determined by the time-lock penalty.

• The time-lock penalty decays until a full 12 month period elapses. At this point mHEDGE becomes $HEDGE at a 1:1 ratio.

• Time-locked mHEDGE is considered staked and will continue to accrue additional rewards until the user claims into $HEDGE or after the 12 month time-lock period has elapsed.

• For $HEDGE stakers, their mHEDGE rewards will be compounded directly into their mHEDGE staking positions. Note that mHEDGE earned as rewards will be converted back to $HEDGE in a manner that is separate than the principal mHEDGE that was minted through $HEDGE staking directly. See Unlocking mHEDGE for additional details.

• Time-locked mHEDGE rewards are equivalent to mHEDGE minted via the $HEDGE staking mechanism in the context of VIP tiers qualification.

• Users can claim their mHEDGE into $HEDGE at any time, however they will incur conversion penalties of up to a 97% loss (if within 1st month) versus holding for the entire period. The penalty decays using a quadratic formula, therefore the user's rewards become exponentially larger the longer they wait. Full time-lock penalty schedule is below:

mHEDGE Rewards Time-lock (Months)	% Recieved in form of $HEDGE
0	3
1	4
2	5.5
3	7.5
4	10
5	13.5
6	18
7	24
8	32
9	42
10	56.5
11	75
12	100