Contract analysis

I. Introduction and Purpose Calderwood & Harkness LLP writes on behalf of its client, Redstone Gaming Corp. ("Redstone" or "RGC"), a Delaware corporation publicly traded on the Nasdaq Stock Market under ticker symbol RDST, with principal offices located at 4100 Obsidian Tower Boulevard, Suite 2200, Las Vegas, Nevada 89109. We have been retained by Redstone as its primary defense counsel in connection with the matter

II. Identification of the Underlying Action The underlying action giving rise to this claim is identified as follows: Case Caption: Luminos Interactive LLC v. Redstone Gaming Corp. Case Number: 2:24-cv-00587-RWL Court: United States District Court for the District of Nevada Presiding Judge: The Honorable Rebecca W. Langford Date Filed: March 18, 2024 Plaintiff: Luminos Interactive LLC, a Texas limited liability compa

III. Summary of the Complaint's Allegations The complaint, a complete copy of which is enclosed with this letter as Enclosure A, sets forth the following principal allegations against Redstone: Luminos Interactive LLC ("Luminos") alleges that Redstone's flagship multiplayer online video game title, Ironclad Dominion, which was commercially released on November 14, 2022, incorporates character designs, environmental t

IV. Identification of the Policy and Applicable Coverage The insurance policy under which Redstone tenders this claim is identified as follows: Policy: Media/Entertainment Liability Policy Policy Number: PML-IP-2023-08841 Issuing Insurer: Pinnacle Mutual Insurance Co. Named Insured: Redstone Gaming Corp. Relevant Coverage Section: intellectual Property Litigation Sub-Limit IP Litigation Sub-Limit: $15,000,000.00 per

V. Engagement of Defense Counsel Redstone has retained Calderwood & Harkness LLP as its primary defense counsel in this matter. The engagement was formally opened on April 3, 2024, under Calderwood & Harkness Matter No. 1033-00004. The engagement team assigned to this matter consists of the following attorneys and support professionals: Catherine Bloom, Responsible Partner, intellectual Property Litigation Practice G

VI. Anticipated Defense Strategy and Cost Categories While Redstone's defense strategy remains under development and will be refined as discovery progresses, we can identify the following principal lines of defense that we anticipate pursuing on Redstone's behalf: (a) Independent Creation. Redstone maintains that all of the visual assets challenged by Luminos were independently created by Redstone's in-house art team

1. Attorney's fees for Calderwood & Harkness LLP (primary defense counsel) and Thorngate & Associates, PC (local counsel), including fees for all phases of the litigation from initial pleadings through trial and any post-trial proceedings.

2. Expert witness fees. Redstone anticipates retaining at least two expert witnesses: (i) a visual-asset comparison expert with expertise in game design and digital art to opine on the lack of substantial similarity between the challenged assets and to analyze the prevalence of comparable elements across the fantasy-RPG genre; and (ii) a damages and valuation rebuttal expert to challenge Luminos's $28.5 million appor

3. Digital forensics consulting. Redstone anticipates retaining a digital forensics firm to authenticate and present the metadata from Redstone's art production pipeline, including Git repository commit histories, file system timestamps, Adobe Creative Suite project files, and Unreal Engine asset import logs, to substantiate the independent creation defense.

4. Court filing fees, deposition costs, and other litigation expenses. These include costs for court reporter services, deposition transcripts, videography, travel expenses for depositions and court appearances, demonstrative exhibit preparation, and any other costs and disbursements reasonably incurred in the defense of this action. We respectfully request that Pinnacle Mutual confirm that each of the foregoing cost

VII. Request for Coverage Confirmation and Ongoing Communication On behalf of Redstone, we respectfully request that you, or your designated representative, provide written confirmation of Pinnacle Mutual's acceptance of Redstone's tender of defense and Pinnacle Mutual's agreement to cover defense costs incurred in connection with the underlying action, above the $5,000.00 per-claim deductible and up to the $15,000,0

VIII. Reservation of Rights Nothing in this letter, nor in any prior or subsequent communication between or among Redstone, Calderwood & Harkness LLP, and Pinnacle Mutual, is intended to, nor shall it be construed to, waive, limit, release, or otherwise prejudice any right, remedy, or defense available to Redstone under the Policy, under any other insurance policy, at law, or in equity. Redstone expressly reserves al

IX. Enclosures Enclosed with this letter, please find the following document: Enclosure A: Copy of the Complaint, Luminos Interactive LLC v. Redstone Gaming Corp., Case No. 2:24-cv-00587-RWL, United States District Court for the District of Nevada (filed March 18, 2024), including all exhibits attached thereto. We appreciate Pinnacle Mutual's prompt attention to this matter and look forward to receiving written confi