Contract analysis

1. Introduction and Purpose We write on behalf of our client, Brightfield Cloud Services Inc. ("Brightfield"), in connection with the proposed inbound exclusive technology license from Nexilis Innovations Ltd. ("Nexilis") for the DeltaSync distributed-cache orchestration technology (the "DeltaSync Platform"). As you know, Calderwood & Harkness LLP serves as outside intellectual property and licensing counsel to Brigh

2. Background — The Field-of-Use Impasse To ensure that this proposal is evaluated in proper context, we briefly summarize the parties' respective positions on the field-of-use issue. Nexilis's Position. As reflected in the redline Draft 2 returned by your firm on July 31, 2023, Nexilis has taken the position that the exclusive license granted to Brightfield should be restricted to Brightfield's deployment of the Del

3. The Tiered-Unlock Proposal — Overview Brightfield proposes a two-tier licensing structure that would operate as follows: Tier 1 — Base License. At execution of the definitive License Agreement, Nexilis would grant Brightfield an exclusive license to use, integrate, reproduce, modify, and sublicense the DeltaSync Platform technology for deployment to end-customers in the financial services vertical (SIC codes 6000–

4. Tier 1 — Base License Terms 4.1 Scope of Tier 1 License The Tier 1 Base License would be an exclusive, fully paid-up license within the financial services vertical (SIC codes 6000–6799) and the healthcare vertical (SIC codes 8000–8099). The grant would encompass all rights necessary for Brightfield to integrate the DeltaSync Platform into the Stratos cloud-management platform, and to market, distribute, offer for

5. Tier 2 — Expansion Option Terms 5.1 Nature of the Expansion Option Concurrently with the grant of the Tier 1 Base License, the License Agreement would include a provision granting Brightfield an irrevocable, unconditional option (the "Expansion Option") to expand the field of use under the License Agreement. The Expansion Option would be granted to Brightfield at the execution of the License Agreement and would re

6. Commercial Rationale Brightfield believes that the tiered-unlock structure described in this letter provides meaningful commercial value to both parties and represents a fair and balanced resolution of the field-of-use impasse. Value to Nexilis. Under the tiered-unlock proposal, Nexilis would receive committed license fees of $5,200,000 for a two-vertical exclusive license. On a per-vertical basis, this represents

7. Proposed Timeline for Response and Next Steps Given the length of time that the parties have already devoted to negotiating the field-of-use issue, and in the interest of maintaining the momentum of these negotiations, Brightfield respectfully requests that Nexilis and Whitmore & Falk provide a substantive written response to this proposal by no later than September 12, 2023. The response need not address every de

8. Reservation of Rights This proposal is made without prejudice to any of Brightfield's positions in the ongoing negotiations regarding the Technology License Agreement, including, without limitation, Brightfield's position that the license should encompass all enterprise SaaS verticals without industry restriction. Nothing in this letter shall be construed as an admission, waiver, or concession by Brightfield with