Contract analysis

I. DEPOSITION OVERVIEW Witness: Janet Kirkwood, Vice President, Carrier Relations, Stonefield Logistics Group Inc. Date of Deposition: July 14, 2023 Location: Offices of Calderwood & Harkness LLP, 200 Park Avenue, 38th Floor, New York, NY 10166 Duration: Approximately 6.5 hours (including two scheduled breaks and one additional break requested by witness) Examining Counsel: Harrison Caldwell, Named Partner, Caldwell

II. BACKGROUND AND ROLE (APPROXIMATE TRANSCRIPT PAGES 8–35) A. Professional Background Kirkwood testified that she has served as Vice President, Carrier Relations at Stonefield Logistics Group Inc. since 2018. Prior to joining Stonefield, she held logistics management positions at two other companies over a period of approximately twelve years, including approximately seven years as Director of Carrier Operations at

III. VTS PERFORMANCE DETERIORATION — Q3 AND Q4 2021 (APPROXIMATE TRANSCRIPT PAGES 36–82) A. Q3 2021 Performance Kirkwood testified that she began receiving reports from members of Stonefield's operations team in approximately August 2021 indicating that VTS's tender acceptance rates were declining on certain lanes. She stated that the initial reports came from her regional carrier managers, who flagged an increase in

IV. THE SEPTEMBER 22, 2021 INTERNAL EMAIL (APPROXIMATE TRANSCRIPT PAGES 83–142) A. CRS's Examination Approach This was the most heavily examined area of the deposition by a significant margin. Harrison Caldwell devoted approximately ninety (90) minutes of examination to this single document and its surrounding circumstances. His examination was methodical, returning to the email's language repeatedly from different a

1. The four-month gap between the email (September 22, 2021) and the issuance of the Cure Notice (January 18, 2022) supports the argument that no termination decision was made as of the date of the email and that the Cure Notice was issued only after the accumulation of additional, more severe performance data in Q4 2021.

2. Kirkwood's testimony that Stonefield continued to tender loads to VTS on all lanes — including Primary Lanes — throughout Q4 2021 is inconsistent with the notion of a predetermined exit plan.

3. The email expressly references Lanes 8 through 14, which are Secondary Lanes not subject to exclusivity, reinforcing the defense position that the volume shifts described in the email did not constitute a breach of the TSA.

4. The email is addressed to a single recipient (Carlos Medina) and reads as an informal, personal expression of frustration rather than a formal business recommendation or directive. Recommendation: In summary judgment briefing, address this email head-on rather than attempting to minimize it. Argue that: (i) the email reflects Kirkwood's awareness of deteriorating VTS performance, not a termination plan; (ii) Stone

V. VOLUME DIVERSION TO CASCADE FREIGHT SYSTEMS AND BRIARWOOD TRUCKING (APPROXIMATE TRANSCRIPT PAGES 143–178) A. Factual Testimony Kirkwood testified in detail regarding Stonefield's engagement of Cascade Freight Systems Inc. ("Cascade"), headquartered in Columbus, Ohio, and Briarwood Trucking Co. ("Briarwood"), headquartered in Arlington, Virginia, to handle freight on Lanes 8 through 14 during the period beginning i

VI. RATE ADJUSTMENT MOTIVE (APPROXIMATE TRANSCRIPT PAGES 179–225) A. CRS's Theory CRS devoted a substantial portion of the afternoon session to a line of questioning designed to establish that Stonefield's true motive for terminating the TSA was to avoid the upcoming rate adjustment scheduled to take effect on April 1, 2022 under the Rate Adjustment Mechanism set forth in Section 5.3 of the TSA. This theory is centra

VII. THE CURE NOTICE AND TERMINATION PROCESS (APPROXIMATE TRANSCRIPT PAGES 226–270) A. Kirkwood's Role in the Cure Notice Process Kirkwood testified regarding her role in the discussions and decision-making process that led to the issuance of the Cure Notice on January 18, 2022. She stated that she was involved in discussions with Carlos Medina (SVP, Operations), Tobias Wren (General Counsel), and Raymond Hess (Direc

VIII. STONEFIELD'S VOLUME TENDERING (APPROXIMATE TRANSCRIPT PAGES 271–298) A. Annual Committed Volume — Contract Year 2 Kirkwood testified regarding Stonefield's volume tendering obligations under the TSA and the extent to which Stonefield met those obligations during the relevant contract years. She confirmed that the Annual Committed Volume ("ACV") under the TSA was $43.2 million per contract year, representing the

IX. KEY EXHIBITS REVIEWED DURING DEPOSITION The following fourteen exhibits were marked during the Kirkwood deposition. Key exhibits are discussed in the relevant substantive sections of this memorandum as indicated below.

X. OBJECTIONS AND INSTRUCTIONS NOT TO ANSWER Patrick Gallagher raised objections to form on approximately twelve (12) occasions during the deposition. These objections were made in the ordinary course and addressed issues such as compound questions, questions assuming facts not in evidence, and questions calling for legal conclusions. None of the objections resulted in sustained disputes or colloquy that materially i

XI. COMPARISON TO DEPOSITION PREPARATION AND EXPECTED TESTIMONY Kirkwood's testimony was consistent with the positions and themes developed during the witness preparation session held on July 11, 2023 with Patrick Gallagher and Samuel Eklund. There were no material deviations from her prepared positions and no unexpected admissions or surprises. Specifically: • September 22, 2021 email: Kirkwood followed the preparat

XII. SUMMARY OF KEY ADMISSIONS AND FAVORABLE TESTIMONY A. Testimony Favorable to Stonefield The following are the principal favorable points established through Kirkwood's testimony:

1. Performance failures were real and documented. Kirkwood confirmed that VTS's performance failures across all five SLO categories in Q4 2021 were real, sustained, severe, and documented through VTS's own Carrier Performance Portal data. The failures were not minor or marginal — on-time pickup was 78.2% against a 95% threshold, tender acceptance was 71.4% against a 90% threshold, and equipment availability was appro

2. Volume diversion was limited to Secondary Lanes. Kirkwood testified unequivocally that the volume moved to Cascade Freight Systems Inc. and Briarwood Trucking Co. was limited to Lanes 8 through 14 (Secondary Lanes) and was responsive to VTS's own tender rejections on those lanes. She denied any diversion of Primary Lane freight. This testimony, corroborated by the Cascade and Briarwood third-party subpoena respons

3. VTS concealed the fleet redeployment. Kirkwood testified that she was not informed by anyone at Vantor or VTS that VTS had pulled approximately 85 tractors off the Stonefield dedicated lanes and redeployed them to the Northwind Distribution Co. account. She learned of this redeployment only through discovery. This testimony supports the defense's first-to-breach argument and tends to undermine VTS's credibility.

4. The September 22 email reflected frustration, not a decision. Kirkwood effectively contextualized the "pull the plug" language as a colloquial expression of personal frustration, not a statement of corporate intent. She testified that no decision to terminate the TSA was made until early January 2022, approximately four months later, and only after Q4 2021 performance data confirmed sustained, severe SLO failures.

5. The termination was performance-based, not rate-driven. Kirkwood denied that the upcoming rate adjustment played any role in the termination decision. She testified that cost savings from termination were not discussed in any meeting she attended and that Stonefield had honored prior-year rate adjustments without incident.

6. Force majeure reduced the CY2 ACV obligation. Kirkwood testified that Stonefield's invocation of the force majeure clause for the April–September 2020 period was properly documented, reducing the adjusted ACV for Contract Year 2 to $21.6 million. Stonefield's actual tenders of $31.8 million exceeded this adjusted threshold by $10.2 million, negating any claim of a volume shortfall in CY2. B. Areas of Concern / Pot

2. Awareness of rate adjustment magnitude. Kirkwood acknowledged awareness of the upcoming 14.3% rate increase and its $6.2 million annual cost impact. While she firmly denied that the rate adjustment influenced the termination decision, Vantor may argue that the combination of Kirkwood's awareness, the circumstantial timing of the termination relative to the April 1, 2022 effective date, and the financial magnitude

3. CY3 volume shortfall. Kirkwood acknowledged that Contract Year 3 tenders totaled approximately $36.5 million against a $43.2 million ACV, which Vantor may characterize as a significant volume shortfall that itself constituted a breach of Stonefield's obligations under the TSA. While Kirkwood persuasively explained that the contract year was not completed at the time of termination and that Stonefield's tender volu

XIII. RECOMMENDATIONS FOR SUMMARY JUDGMENT AND TRIAL PREPARATION Based on the testimony elicited during the Kirkwood deposition, the following recommendations are made for summary j