Contract analysis

Section 1: The Company Full Legal Name: Lumos Analytics Inc. State of Incorporation: Delaware (incorporated January 14, 2022) Delaware Secretary of State File No.: 7394821 Federal Employer Identification Number (EIN): 87-3491026 Principal Place of Business: 340 Folsom Street, Suite 1100, San Francisco, CA 94105 Registered Agent: CT Cascade Systems, 1209 Orange Street, Wilmington, Delaware 19801 Principal Business: Th

3. Kenji Watanabe — Independent Director Employees: The Company has fourteen (14) full-time employees as of August 2023, including the officers named above. All employees are based in San Francisco, California or work remotely within the United States. Monthly Recurring Revenue: Approximately Thirty-Eight Thousand Dollars ($38,000) as of July 2023, derived from subscription agreements with six (6) active institutiona

Section 2: The Offering Instrument: Post-Money Simple Agreement for Future Equity (Post-Money SAFE), based on the standard form published by Calderon Partners LLC, as modified to incorporate the specific terms and provisions set forth in this term sheet and as further modified in the definitive documentation to be negotiated by the parties and their respective counsel. Total Round Target: Up to Six Million Eight Hund

Section 3: Post-Money Valuation Cap Post-Money Valuation Cap: Twenty-Eight Million Dollars ($28,000,000). Upon conversion of the Investor's SAFE in connection with an Equity Financing (as defined in Section 4), the Investor's pro forma ownership of the Company on a fully diluted basis shall be calculated as the quotient of the Purchase Amount divided by the Post-Money Valuation Cap, which, based on the Investor's com

Section 4: Conversion Events The SAFEs issued in the SAFE Round shall convert into equity securities of the Company, or result in a payment to the holders thereof, upon the occurrence of the following events: Equity Financing: The SAFE shall automatically convert into shares of the same class and series of preferred stock issued to investors in such Equity Financing upon the closing of a bona fide equity financing ro

Section 5: Most Favored Nation (MFN) Provision If, at any time while the Investor's SAFE remains outstanding and unconverted, the Company issues any subsequent SAFE, convertible note, or other convertible security (each, a "Subsequent Convertible Security") to any investor on terms that are, in any material respect, more favorable to the holder of such Subsequent Convertible Security than the terms of the Investor's

Section 6: Pro Rata Rights In connection with the closing of the SAFE Round, the Company and the Investor shall enter into a separate Pro Rata Rights Side Letter (the "Side Letter"), pursuant to which the Investor shall be granted the right to participate, on a pro rata basis (based on the Investor's ownership percentage on an as-converted, fully diluted basis), in the next equity financing round of the Company follo

Section 7: Information Rights From and after the closing of the SAFE Round and for so long as the Investor holds an unconverted SAFE or equity securities of the Company issued upon conversion thereof, the Company shall provide to the Investor the following information: (a) Annual Financial Statements. Within ninety (90) days following the end of each fiscal year of the Company, unaudited financial statements of the C

Section 8: Existing Capitalization The Company represents that, as of the date hereof, the capitalization of the Company is as set forth below. The Company shall deliver to the Investor a certified capitalization table as part of the due diligence process, and shall represent and warrant in the definitive SAFE agreement that such capitalization table is true, correct, and complete as of the date of execution thereof.

Section 9: Intellectual Property The Company has filed U.S. Provisional Patent Application No. 63/987,214 with the United States Patent and Trademark Office on June 15, 2023, covering the proprietary predictive risk algorithm underlying the Prism Core module of the Lumos Prism platform (the "Provisional Patent Application"). The Company intends to file a non-provisional utility patent application within the twelve-mo

Section 10: Use of Proceeds The Company intends to use the proceeds from the SAFE Round for general corporate purposes, including without limitation: (a) continued development and enhancement of the Lumos Prism platform, including investment in the Prism Core predictive risk engine and expansion of the compliance dashboard feature set; (b) hiring of additional engineering, data science, sales, and customer success pe

Section 11: Definitive Documents The investment contemplated by this term sheet shall be made pursuant to a definitive Post-Money SAFE agreement and such related ancillary documents (including, without limitation, the Pro Rata Rights Side Letter and any board or stockholder resolutions) as may be reasonably required (collectively, the "Definitive Documents"), to be negotiated in good faith between the parties and the

Section 12: Due Diligence The Investor's obligation to consummate the investment contemplated by this term sheet is subject to the completion of customary business, legal, financial, and intellectual property due diligence to the Investor's satisfaction in its sole discretion. Such due diligence may include, without limitation, review of the Company's corporate records, material contracts, financial statements, tax r

Section 13: Governing Law THIS SECTION IS BINDING UPON THE PARTIES. This term sheet and any disputes arising out of or in connection with this term sheet, including disputes relating to the Confidentiality, Exclusivity, and Governing Law provisions hereof, shall be governed by and construed in accordance with the internal laws of the State of Delaware, without giving effect to any choice of law or conflict of law rul

Section 14: Confidentiality THIS SECTION IS BINDING UPON THE PARTIES. The existence and terms of this term sheet, as well as all information exchanged between the parties in connection with the proposed investment (collectively, "Confidential Information"), are confidential and shall not be disclosed by either party to any third party without the prior written consent of the other party; provided, however, that each

Section 15: Exclusivity THIS SECTION IS BINDING UPON THE PARTIES. From the date of execution of this term sheet through September 30, 2023 (or such later date as the Company and the Investor may agree in writing) (the "Exclusivity Period"), the Company shall not, and shall cause its officers, directors, employees, agents, and advisors not to, directly or indirectly, (a) solicit, initiate, encourage, or facilitate any

Section 16: Non-Binding Nature Except for the provisions of Section 13 (Governing Law), Section 14 (Confidentiality), and Section 15 (Exclusivity), each of which is expressly binding upon the parties as set forth therein, this term sheet is non-binding and does not create any legally enforceable rights or obligations of either party. Neither party shall have any obligation to negotiate, execute, or deliver any Defini

Section 17: Expenses Each party shall bear its own legal, accounting, advisory, and other expenses incurred in connection with the negotiation, preparation, due diligence, and execution of this term sheet and the Definitive Documents. For the avoidance of doubt, the Company shall be responsible for its own counsel fees and the Investor shall be responsible for its own counsel fees, and neither party shall have any ob