Contract analysis

I. Purpose and Introduction This letter constitutes formal notice of the settlement of the above-captioned patent infringement action, Apex Surgical Innovations, Inc. v. Solstice Biomedical, Inc., Case No. 1:24-cv-00587-RGA, pending in the United States District Court for the District of Delaware. This letter is provided pursuant to the settlement reporting obligations set forth in intellectual Property Defense Liabi

II. Background of the Litigation On May 9, 2024, Apex Surgical Innovations, Inc. ("Apex"), a corporation organized and existing under the laws of the State of Delaware (EIN: 51-0483762), with its principal office located at 1220 North Market Street, Suite 550, Wilmington, Delaware 19801, filed a complaint for patent infringement against Solstice Biomedical, Inc. in the United States District Court for the District of

1. U.S. Patent No. 9,814,237 (the "'237 Patent"), entitled "Locking Seal Assembly for Minimally Invasive Surgical Access Device," issued on November 14, 2017, with a calculated expiration date of June 22, 2035. Apex asserted infringement of Claims 1, 3, 7, and 12 of the '237 Patent.

2. U.S. Patent No. 10,271,884 (the "'884 Patent"), entitled "Retractable Blade Deployment Mechanism for Trocar Systems," issued on April 30, 2019, with a calculated expiration date of September 15, 2036. Apex asserted infringement of Claims 1, 2, 5, 9, and 14 of the '884 Patent.

3. U.S. Patent No. 10,932,105 (the "'105 Patent"), entitled "Integrated Insufflation Valve and Seal for Laparoscopic Trocar," issued on March 2, 2021, with a calculated expiration date of January 10, 2038. Apex asserted infringement of Claims 1, 4, and 8 of the '105 Patent. B. Accused Products Apex's infringement allegations were directed at Solstice's PrecisionEdge™ product line, specifically the following three pro

III. Summary of Litigation Proceedings A. Scheduling and discovery Following an initial case management conference, the Court entered its Scheduling Order on July 2, 2024. The parties filed their Joint discovery Plan on July 15, 2024, which set forth the agreed-upon framework for the phased exchange of discovery materials. Fact discovery was extensive. Solstice produced a total of 48,217 documents in response to Apex

IV. Settlement Terms A. Execution of Settlement Documents The parties executed a binding Term Sheet on June 10, 2025, memorializing the material terms of their agreement. A Definitive Settlement Agreement and Mutual Release (the "Settlement Agreement"), together with ancillary exhibits, was fully executed by all parties on June 16, 2025. An executed copy of the Settlement Agreement is enclosed with this letter, marke

1. Lump-Sum Payment. Solstice has agreed to pay Apex a total lump-sum settlement payment of Eight Million Seven Hundred Fifty Thousand Dollars ($8,750,000.00), payable in two tranches: (a) Tranche 1: Five Million Two Hundred Fifty Thousand Dollars ($5,250,000.00), due and payable within ten (10) business days of the execution of the Settlement Agreement (i.e., on or before June 30, 2025). (b) Tranche 2: Three Million

2. Running Royalty. In addition to the lump-sum payment, Solstice has agreed to pay Apex a running royalty of three and three-quarters percent (3.75%) of Net Sales (as defined in the Settlement Agreement) of Licensed Products for the remaining life of the Licensed Patents. The Licensed Products encompass the PrecisionEdge™ PE-5000, PE-12000, and PE-15000 series products and their successors. The running royalty is su

3. License Grant. The Settlement Agreement provides for a non-exclusive, non-transferable, worldwide license to Solstice under the '237 Patent, the '884 Patent, and the '105 Patent, including any continuations, divisionals, or reissues thereof, solely in the field of laparoscopic surgical access devices. Solstice's right to sublicense is limited to sublicenses granted to Solstice's contract manufacturers for the purp

4. Covenant Not to Sue. Apex has provided a covenant not to sue, pursuant to which Apex covenants that it will not assert any patent in the Apex Trocar Patent Family — comprising fourteen (14) issued United States patents and six (6) pending continuation applications — against Solstice or any of its subsidiaries for products within the licensed field during the term of the license.

5. Most-Favored Licensee. The Settlement Agreement includes a most-favored licensee provision, under which, if Apex enters into a license agreement with any third party at a running royalty rate below 3.75% for products within the same licensed field, Solstice's running royalty rate shall be adjusted prospectively to match the lower rate.

6. Mutual Release. The parties have agreed to a full mutual release of all claims, counterclaims, and defenses asserted in Case No. 1:24-cv-00587-RGA, effective upon execution of the Settlement Agreement and the filing of the Stipulation of Dismissal.

7. Dismissal. The parties will file a Stipulation of Dismissal with Prejudice pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(ii), with each party bearing its own costs and attorneys' fees. The target filing date for the Stipulation of Dismissal is on or about July 1, 2025.

8. Confidentiality. The terms and conditions of the settlement are subject to mutual confidentiality obligations. The parties have agreed that any joint public statement regarding the resolution of the matter shall be limited to the following: "The matter has been resolved on mutually agreeable terms."

9. Governing Law. The Settlement Agreement is governed by and construed in accordance with the laws of the State of Delaware, without regard to conflict of laws principles.

V. Insurance Coverage Analysis and Confirmation As you are aware, Policy No. HSI-IP-2023-04891 provides coverage for patent infringement defense costs, including attorneys' fees and litigation expenses incurred in the defense of covered claims. Importantly, however, the Policy does not extend coverage to settlement payments, royalty obligations, or other amounts paid to a plaintiff in resolution of the underlying pat

VI. Summary of Defense Fees and Costs Total fees and costs billed by Calderwood & Harkness LLP through June 1, 2025, in connection with the defense of this matter are as follows: A breakdown of the principal cost categories within the $235,839.42 in disbursements is provided below: Please note that the separate engagement fees of Kendrick & Lau LLP, in the amount of $184,500.00, incurred for prior art search and free

VII. Confirmation of Billing Rate Information For the avoidance of doubt and for the completeness of Halcyon's claim file, we confirm the Calderwood & Harkness LLP billing rates applicable during this engagement (2024–2025), which have been consistent with the rates previously approved by Halcyon: The engagement team for this matter consisted of the following attorneys: • Marcus Delgado, Responsible Partner • Catheri

VIII. Request for Confirmation and Next Steps We respectfully request that Halcyon take the following actions in connection with the resolution of this matter:

1. Acknowledgment of Receipt. Please acknowledge receipt of this settlement reporting letter at your earliest convenience.

2. File Closure Confirmation. We request that Halcyon confirm that its claim file for Claim/Policy No. HSI-IP-2023-04891 may be closed upon the filing of the Stipulation of Dismissal with Prejudice, which is targeted for on or about July 1, 2025.

3. Stipulation of Dismissal. Calderwood & Harkness will provide Halcyon with a copy of the filed Stipulation of Dismissal once it has been entered by the Court.

4. Additional Information. Should Halcyon require any additional information, documentation, or clarification in order to close its claim file, we are happy to provide the same promptly upon request.

5. Confidentiality of Settlement Terms. We confirm that all settlement documentation provided with this letter is subject to the confidentiality provisions of the Settlement Agreement. We respectfully request that Halcyon maintain the confidentiality of the settlement terms in accordance with its obligations under the Policy and applicable law, and that access to the enclosed Settlement Agreement within Halcyon's org

IX. Reservation of Rights This letter is provided for informational and settlement reporting purposes only. Nothing contained herein is intended to, nor shall it be construed to, waive any rights of the Insured under the Policy, including, without limitation, any right to seek coverage for additional defense-related costs that may hereafter be identified or that may arise in connection with the finalization and dismi

1. Copy of Executed Settlement Agreement and Mutual Release (Execution Version, dated June 16, 2025) — marked "CONFIDENTIAL — Subject to Settlement Confidentiality Provisions"

2. Final Fee and Cost Summary through June 1, 2025 (Matter No. 10294.0017) Category | Amount Attorney Fees | $2,611,480.00 Costs and Disbursements | $235,839.42 Total Fees and Costs | $2,847,319.42 Disbursement Category | Amount Expert Fees — Dr. Miriam Ostrowski (invalidity/claim construction; $750/hr) | $127,500.00 Expert Fees — Dr. Elena Marchetti / Pinnacle Economics Group LLC (damages; $850/hr) | $89,250.00 E-di