Contract analysis

I. Description of the Litigation On August 12, 2022, Vantor Holdings Corp. ("Vantor"), a New York corporation headquartered at 580 Eighth Avenue, 14th Floor, New York, New York 10018, filed a civil complaint against Stonefield Logistics Group Inc. in the United States District Court for the Southern District of New York. The case has been assigned Case No. 22-cv-07841 (the "Litigation"). The full caption of the matte

II. Damages Claimed and Potential Exposure Vantor's Complaint seeks damages in the approximate aggregate amount of Ninety-Five Million Four Hundred Thousand Dollars ($95,400,000), comprised of the following categories: The aggregate amount of damages claimed by Vantor in the Complaint exceeds the Twenty-Five Million Dollar ($25,000,000) notification threshold set forth in Section 6.03(b) of the Credit Agreement, whic

III. Stonefield's Position and Assessment of the Claims Management of the Borrower has carefully reviewed the allegations set forth in Vantor's Complaint, in consultation with internal and external legal advisors, and believes that the claims asserted by Vantor lack merit. The Borrower intends to vigorously defend against the Complaint and all claims asserted therein. Without limiting any defenses or arguments that m

IV. Retention of Counsel Stonefield is in the process of retaining experienced outside litigation counsel to defend this matter. Stonefield's existing outside counsel, Ashford Meridian LLP, is providing initial guidance and legal support in connection with the Litigation while specialized litigation counsel is being formally engaged. The Borrower expects to finalize the retention of defense counsel promptly and will

V. Ongoing Reporting Commitment The Borrower acknowledges that the Administrative Agent, acting on behalf of the lenders under the Credit Agreement, may from time to time request additional information regarding this litigation matter. The Borrower is prepared to provide periodic updates on the status of the Litigation at reasonable intervals and in a manner consistent with its obligations under the Credit Agreement,

VI. No Impact on Credit Facility The Borrower affirms that the commencement of this litigation does not constitute a Default or an Event of Default under the Credit Agreement, including under Section 8.01(h) (Judgments) or any other provision thereof. The Borrower's financial condition remains sound. Even in the unlikely event that an adverse outcome were to be reached in this matter — which management does not expec

VII. Reservation of Rights The delivery of this notice is made solely for purposes of compliance with Section 6.03(b) of the Credit Agreement. Nothing contained in this notice shall constitute, or shall be construed as, an admission of liability by the Borrower, an acknowledgment of the merits of any claims asserted by Vantor in the Complaint, or a waiver of any rights, defenses, or remedies available to the Borrower

VIII. Closing. Should you or any representative of the Administrative Agent wish to discuss this matter further, or should you require any additional information regarding the Litigation, please do not hesitate to contact me directly at your earliest convenience. I am available to arrange a call or meeting to address any questions or concerns the Administrative Agent may have. My direct contact information is as foll