Contract analysis

I. EXECUTIVE SUMMARY The purpose of this memorandum is to provide Skybridge Fintech Ltd. ("Skybridge" or the "Company") and issuer's counsel with a comprehensive analysis of the post-Series B preferred stock capitalization structure, liquidation waterfall mechanics, anti-dilution protections, and option pool expansion in connection with the proposed $45,000,000 Series B Preferred Stock financing (the "Series B Financ

II. PRE-SERIES B CAPITALIZATION This Section sets forth the Company's capitalization as it exists immediately prior to the closing of the Series B Financing. The capitalization data presented below has been compiled from records provided by the Company's management, confirmed against transfer agent records maintained by Ledgermark Transfer Services, Inc., and cross-referenced to the Company's audited financial statem

III. SERIES B FINANCING — TERMS AND INVESTOR ALLOCATIONS This Section sets forth the key economic terms of the Series B Financing and the allocation of shares among the participating investors. A. Series B Economic Terms The following table summarizes the principal economic terms of the Series B Preferred Stock, as set forth in the draft term sheet dated April 22, 2022 and the draft Stock Purchase Agreement circulate

IV. POST-SERIES B CAPITALIZATION (FULLY DILUTED) This Section sets forth the Company's capitalization on a fully diluted basis as it will exist immediately following the closing of the Series B Financing and the filing of the A&R COI with the Delaware Secretary of State. A. Complete Post-Closing Cap Table The available-for-grant figure of 2,535,000 shares reflects the sum of the 900,000 shares that were previously av

V. PREFERRED STOCK RIGHTS, PREFERENCES, AND PRIVILEGES — SUMMARY COMPARISON This Section provides a comparative analysis of the rights, preferences, and privileges attached to each series of the Company's Preferred Stock, as set forth in the A&R COI. A. Comparative Table The table above reflects the principal economic and governance terms associated with each series. Each of these features is discussed in further det

1. Any amendment, alteration, or repeal of any provision of the Certificate of Incorporation or the Bylaws of the Company that adversely affects the rights, preferences, privileges, or powers of the Series B Preferred Stock.

2. The creation, authorization, or issuance (or obligation to issue) of any equity security of the Company that is senior to or on parity with the Series B Preferred Stock with respect to dividends, liquidation preference, redemption, or voting rights, or any security convertible into or exchangeable for any such equity security.

3. Any Deemed Liquidation Event, including any merger or consolidation of the Company with or into another entity, or any sale, lease, exclusive license, or other disposition of all or substantially all of the assets of the Company.

4. Any redemption, repurchase, or other acquisition of shares of the Company's capital stock (other than repurchases of unvested shares at cost upon termination of service pursuant to the terms of the applicable equity award agreement).

5. Annual capital expenditures exceeding $5,000,000 in the aggregate.

6. The incurrence of indebtedness (including capital lease obligations and guarantees) exceeding $3,000,000 in the aggregate.

7. Any increase in the number of shares reserved for issuance under the 2018 Equity Incentive Plan (or any successor plan) beyond 15% of the post-closing fully diluted shares of the Company (i.e., beyond 4,635,000 shares based on the current fully diluted share count of 30,900,000).

8. The declaration or payment of any dividend or other distribution on any shares of Common Stock. These protective provisions grant the Series B holders (and principally GPV, as the holder of 66.67% of the Series B) effective veto power over the enumerated corporate actions, regardless of the Board of Directors' composition or the outcome of a general stockholder vote. The practical significance of these provisions

VI. OPTION POOL ANALYSIS A. Pre-Series B Option Pool Prior to the closing of the Series B Financing, the Company's 2018 Equity Incentive Plan provides for the following: Total shares reserved under the Plan: 3,000,000 shares of Common Stock. Options outstanding: 2,100,000 shares subject to outstanding stock option awards. These options have a weighted-average exercise price of $1.15 per share and are held by approxim

VII. LIQUIDATION WATERFALL ANALYSIS A. Waterfall Mechanics — Overview The Company's A&R COI, as it will be in effect following the closing of the Series B Financing, establishes a non-participating preferred liquidation preference structure that governs the distribution of proceeds upon a "Deemed Liquidation Event." A Deemed Liquidation Event is defined to include (a) a merger or consolidation of the Company with or