Contract analysis

I. EXECUTIVE SUMMARY The purpose of this memorandum is to summarize the key findings from our intellectual property and technology due diligence review of Verdana Software, Inc. in connection with the proposed $60,000,000 minority growth equity investment by Pinnacle Venture Fund II LP. Verdana is a Delaware C-corporation (EIN 93-1485726; Delaware Secretary of State File Number 6274913) headquartered at 1175 NW Couch

II. SCOPE OF REVIEW Our review encompassed the following categories of documents and information sources: Documents and Materials Reviewed: • Organizational intellectual property records, including the Company's internal IP register and asset inventory • Patent filings and prosecution files for all issued U.S. patents and pending U.S. and international patent applications • Trademark registrations, applications, and

III. VERDANA SCX PLATFORM — TECHNOLOGY OVERVIEW A. Platform Description The Verdana SCX platform is a cloud-native, multi-tenant business-to-business SaaS platform designed to provide AI-driven supply chain optimization capabilities to mid-market and enterprise customers. The platform's name derives from "Supply Chain Xcelerate," which also serves as the Company's registered tagline. The SCX platform is the Company's

IV. PATENT PORTFOLIO A. Issued Patents Verdana holds three (3) issued United States utility patents, each of which is relevant to the core technology underlying the SCX platform. The details of these patents are as follows:

1. U.S. Patent No. 10,671,284 — "System and Method for Real-Time Supply Chain Demand Forecasting Using Deep Neural Networks" • Filing Date: August 14, 2018 • Issue Date: June 2, 2020 • Assignee: Verdana Software, Inc. • Named Inventors: Lena Kovac, David Chen, Priya Ramanathan • Status: Active; maintenance fees current through the next maintenance window This patent covers the Company's core demand forecasting method

2. U.S. Patent No. 11,042,597 — "Automated Inventory Optimization Through Reinforcement Learning" • Filing Date: March 22, 2019 • Issue Date: June 22, 2021 • Assignee: Verdana Software, Inc. • Named Inventors: Lena Kovac, Marco Ferretti • Status: Active; maintenance fees current This patent covers the Company's reinforcement learning-based approach to dynamic inventory optimization across distributed warehouse networ

3. U.S. Patent No. 11,138,215 — "Graph-Based Supplier Risk Scoring System" • Filing Date: July 9, 2019 • Issue Date: October 5, 2021 • Assignee: Verdana Software, Inc. • Named Inventors: Lena Kovac, Amara Osei, Jason Whitfield • Status: Active; maintenance fees current This patent covers the Company's proprietary graph-based methodology for assessing and scoring supplier risk, including specific claims directed to th

1. U.S. Patent Application No. 17/348,621 — "Multi-Modal Logistics Routing Optimization Engine" • Filing Date: June 15, 2021 • Status: Office action received from the USPTO examiner; response due within the standard response period. Breckenridge IP Group LLP is preparing the response. • Applicant: Verdana Software, Inc. • Named Inventors: Lena Kovac, Thomas Bergström, Kenji Nakamura The office action raised obviousne

2. U.S. Patent Application No. 17/589,304 — "Federated Learning Framework for Cross-Enterprise Supply Chain Data" • Filing Date: January 31, 2022 • Status: Pending; awaiting first office action from the USPTO. No substantive prosecution issues have arisen to date. • Applicant: Verdana Software, Inc. • Named Inventors: Lena Kovac, David Chen, Sophie Laurent This application relates to a next-generation capability that

3. PCT International Application No. PCT/US2021/036894 — Corresponding to U.S. Patent No. 10,671,284 ("System and Method for Real-Time Supply Chain Demand Forecasting Using Deep Neural Networks") • Filing Date: June 11, 2021 (claiming priority to the U.S. patent) • Designated Countries/Regions: European Union, United Kingdom, Japan, South Korea • Status: National phase entry deadlines are being tracked by Breckenridg

V. TRADEMARK PORTFOLIO A. Registered Trademarks Verdana maintains the following registered trademarks in the United States: All U.S. trademark registrations are current, and the Company has timely filed all required maintenance documents, including Sections 8 and 15 declarations under the Lanham Act where applicable. The trademark portfolio is managed by Langford Price & Associates LLP as part of the Company's genera

VI. TRADE SECRETS AND PROPRIETARY KNOW-HOW Verdana's most commercially significant intellectual property assets are its proprietary AI/ML algorithms, the associated training data sets derived from aggregated and anonymized customer supply chain data, the proprietary graph database architecture used for supply chain network modeling, and the broader engineering methodologies and know-how that underpin the SCX platform

VII. EMPLOYEE AND CONTRACTOR IP ASSIGNMENT AGREEMENTS A. Employee Agreements The Company uses a standard form Confidential Information and Invention Assignment Agreement ("CIIA") across its employee base. We reviewed the template CIIA and found it to be generally consistent with market-standard terms for technology companies, covering: (i) confidentiality obligations regarding proprietary information; (ii) present as

VIII. OPEN-SOURCE SOFTWARE USAGE A. Overview. The Verdana SCX platform incorporates various open-source software ("OSS") components, which is standard and expected practice in modern SaaS software development. The use of open-source components enables faster development cycles, leverages community-maintained code for non-differentiating functionality, and reduces development costs. However, OSS usage carries complian

IX. THIRD-PARTY IP CLAIMS AND DISPUTES A. Pending Claim — Optivex Analytics, Inc. In March 2022, Verdana received a cease-and-desist letter from Optivex Analytics, Inc. ("Optivex"), a Delaware corporation headquartered in Austin, Texas. The letter alleges that certain features of the Verdana SCX platform's demand forecasting module infringe U.S. Patent No. 10,489,137, owned by Optivex and titled "Predictive Analytics

X. INBOUND LICENSE AGREEMENTS Verdana licenses certain third-party software components and data services for integration with or use in connection with the SCX platform. We reviewed the material inbound license agreements identified in the data room and summarize our findings as follows: (a) Cloud Infrastructure Services Agreement. Verdana's primary hosting infrastructure is provided by Adriatic Technologies ("Meridi

XI. OUTBOUND LICENSE AGREEMENTS (CUSTOMER CONTRACTS) Verdana licenses the SCX platform to its customers on a SaaS subscription basis under multi-year enterprise license agreements. We reviewed the Company's standard form customer agreement, as well as representative executed agreements with each of the Company's top five customers by ARR. Standard Customer Agreement Terms. The Company's standard customer agreement gr

1. Meridian Logistics Corp. — Three-year enterprise license agreement, effective January 1, 2021, expiring December 31, 2023, with automatic renewal for successive one-year periods unless either party provides written notice of non-renewal at least 180 days prior to the end of the then-current term. The agreement contains standard IP terms consistent with the Company's form agreement. We did not identify any custom I

2. Caldera Manufacturing Inc. — Two-year enterprise license agreement with standard IP and data use provisions. No non-standard terms identified.

3. Atlas Freight Holdings LLC — Three-year enterprise license agreement with standard IP and data use provisions. No non-standard terms identified.

4. Brannock Industrial Group — Two-year enterprise license agreement with standard IP and data use provisions. No non-standard terms identified.

5. Solaris Warehousing Co. — Two-year enterprise license agreement with standard IP and data use provisions. No non-standard terms identified. IP Indemnification Claims. Based on our review and management representations, no customer has exercised, threatened to exercise, or provided notice of intent to exercise the IP indemnification provisions in any customer agreement. This is consistent with the absence of any IP

XII. DATA PRIVACY AND SECURITY CONSIDERATIONS (IP-ADJACENT) We include this brief note on data privacy and security considerations for completeness, as these matters are adjacent to and intersect with the Company's IP and technology profile. However, we note that detailed data privacy and security diligence is being conducted as a separate workstream and is not the primary focus of this memorandum. Nature of Data Pro