1007-00003 · Whitfield & Gaines PLLC · Correspondence

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CALDERWOOD & HARKNESS LLP

Attorneys at Law

One Fountain Square, 11th Floor Detroit, Michigan 48226 Telephone: (313) 555-7200 Facsimile: (313) 555-7201

1401 McKinney Street, Suite 1900 Houston, Texas 77010 Telephone: (713) 555-4100 Facsimile: (713) 555-4101

www.calderwoodharkness.com

April 14, 2025

VIA E-MAIL AND FIRST CLASS MAIL

Nolan Whitfield, Esq. Whitfield & Gaines PLLC 100 Independence Place, Suite 2800 Tyler, TX 75702

Re: Pinnacle Innovations LLC v. Vantage Mobility Systems Corp., No. 2:24-cv-00187-JRG (E.D. Tex.)

Sub-Ref: Settlement Counterproposal on Behalf of Vantage Mobility Systems Corp.

Dear Mr. Whitfield:

I write on behalf of our client, Vantage Mobility Systems Corp. ("VMS"), the defendant in the above-referenced action, in response to the settlement demand conveyed by your firm on behalf of Pinnacle Innovations LLC ("Pinnacle") in your letter dated March 31, 2025. VMS has given thorough and careful consideration to Pinnacle's demand and the positions expressed therein. While VMS continues to maintain — as it has throughout this litigation — that it does not infringe U.S. Patent No. 9,847,312 B2 (the "'312 Patent") and that the asserted claims of the '312 Patent are invalid, VMS recognizes that the parties share a mutual interest in avoiding the significant costs and substantial business disruption that continued litigation through trial would impose. Accordingly, VMS is prepared to resolve this matter on a business basis, without any concession on the merits, in order to bring this dispute to a prompt and final conclusion.

I am authorized by VMS to transmit the settlement counterproposal set forth below. VMS makes this counterproposal in good faith and in the spirit of commercially reasonable dispute resolution.

I. VMS's Position — Reservation of Rights

At the outset, VMS wishes to make clear that it has not altered its position on the merits of Pinnacle's infringement allegations or on the validity of the '312 Patent. VMS categorically denies that it has infringed, either directly or indirectly, Claims 1, 7, and 14 of the '312 Patent — the only claims asserted by Pinnacle in this action — through the manufacture, sale, offer for sale, use, or importation of the accused VMS DriveLink™ 4.0 telematics control unit and the VMS FleetPulse™ cloud-based fleet management platform. VMS's non-infringement position is well supported by the record, including the claim constructions adopted by this Court.

In particular, VMS respectfully notes that the Court's Claim Construction Order entered on December 19, 2024, construed several disputed claim terms in a manner that VMS believes materially supports its non-infringement position, most notably the Court's construction of the terms "dynamically aggregated telemetry module" and "real-time arbitration protocol" as recited in independent Claims 1 and 14 of the '312 Patent. VMS is confident that its accused products and services do not practice the asserted claims under the constructions adopted by the Court.

VMS further maintains its invalidity defenses under 35 U.S.C. §§ 102 and 103, as well as its counterclaims for declaratory judgment of non-infringement and invalidity, all of which were asserted in VMS's Answer and Counterclaims filed on April 15, 2024. VMS has identified prior art references that it believes are highly relevant to the validity of the asserted claims, and VMS remains prepared to present those references through expert testimony at trial if this matter is not resolved.

Nothing in this letter, in any negotiations related to this counterproposal, or in any settlement agreement that may be reached as a result of these discussions shall constitute, or shall be construed as constituting, an admission by VMS of liability, infringement, or validity of the '312 Patent, or a concession of any kind regarding the merits of Pinnacle's claims or the strength of VMS's defenses and counterclaims. VMS makes this counterproposal solely and exclusively to avoid the considerable expense, management distraction, and business uncertainty associated with the continued prosecution of this litigation through trial.

II. Counterproposal — Settlement Amount

Having carefully evaluated the claims at issue, the applicable claim constructions, the status of discovery, and the costs and risks of further litigation for both parties, VMS proposes the following settlement payment:

VMS proposes a one-time, lump-sum payment of Three Hundred Eighty-Five Thousand Dollars ($385,000.00) (the "Settlement Amount") to Pinnacle, payable in full and final resolution of all claims asserted by Pinnacle and all counterclaims asserted by VMS in the above-captioned action, Pinnacle Innovations LLC v. Vantage Mobility Systems Corp., No. 2:24-cv-00187-JRG (E.D. Tex.).

The Settlement Amount shall be subject to the following payment terms:

(a) The Settlement Amount shall be payable within thirty (30) calendar days following the full execution of a mutually acceptable written settlement agreement by authorized representatives of both Pinnacle and VMS.

(b) Payment shall be made by wire transfer of immediately available funds to a bank account designated by Pinnacle in a written wire instruction letter provided to VMS or its counsel no later than ten (10) business days prior to the payment due date.

(c) The Settlement Amount shall be non-refundable upon payment and shall constitute the sole and exclusive financial consideration to be paid by VMS in connection with the resolution of this matter.

VMS submits that this amount represents a fair and reasonable resolution of this dispute on a business-judgment basis, taking into account the parties' respective litigation positions, the current posture of the case, and the costs that both parties would incur in proceeding through expert discovery, dispositive motions, and trial.

III. Counterproposal — Key Settlement Terms

In addition to the Settlement Amount described above, VMS proposes that any definitive settlement agreement incorporate the following material terms:

A. Covenant Not to Sue

As a condition of the settlement, Pinnacle shall grant to VMS and its affiliates, subsidiaries, parent entities, successors, assigns, customers, distributors, resellers, and end users (collectively, "VMS Released Parties") a perpetual, irrevocable covenant not to sue under:

(i) U.S. Patent No. 9,847,312 B2, including all claims thereof (whether or not asserted in this litigation), and all continuations, continuations-in-part, divisionals, reissues, reexaminations, and foreign counterparts thereof; and

(ii) All other patents and patent applications owned by, assigned to, or controlled by Pinnacle or its affiliates as of the effective date of the settlement agreement (the "Pinnacle Portfolio").

The covenant not to sue shall cover all past, present, and future acts of the VMS Released Parties related to the design, development, manufacture, assembly, testing, use, sale, offer for sale, importation, distribution, marketing, support, maintenance, and update of VMS products and services, including but not limited to the VMS DriveLink™ product line and the VMS FleetPulse™ platform, and all successor, derivative, and related products and services.

For the avoidance of doubt, VMS proposes that the covenant not to sue be structured as a covenant and not as a patent license. VMS does not seek, and the settlement agreement shall not be construed to grant, a license to any patent or patent application in the Pinnacle Portfolio. The distinction between a covenant not to sue and a patent license is material to VMS, and VMS respectfully requests that Pinnacle confirm its agreement to this characterization.

B. Mutual General Releases

Both parties shall exchange mutual general releases of all claims, counterclaims, cross-claims, demands, causes of action, obligations, damages, losses, costs, expenses, and liabilities of any kind or nature whatsoever, whether known or unknown, suspected or unsuspected, asserted or unasserted, accrued or unaccrued, fixed or contingent, that arise from or relate in any way to the litigation captioned Pinnacle Innovations LLC v. Vantage Mobility Systems Corp., No. 2:24-cv-00187-JRG (E.D. Tex.), including but not limited to all claims and counterclaims asserted or that could have been asserted in that action.

The mutual general releases shall be broadly drafted to encompass all claims related to the subject matter of the above-captioned action, including all claims of patent infringement, invalidity, and unenforceability, as well as all claims for damages, injunctive relief, attorneys' fees, costs, and interest. Each party shall release the other party and its respective officers, directors, employees, agents, attorneys, affiliates, subsidiaries, parent entities, successors, and assigns from all such claims and liabilities.

C. No Admission of Liability

The settlement agreement shall contain an express and prominent provision confirming that:

(i) Neither party admits, by entering into the settlement agreement, any liability, fault, wrongdoing, infringement, validity, invalidity, or enforceability or unenforceability of any patent;

(ii) The settlement is entered into solely to avoid the costs and burdens of further litigation and for no other purpose; and

(iii) Neither party shall characterize the settlement, publicly or privately, as reflecting the merits or likely outcome of any claim, defense, or counterclaim asserted in the litigation.

D. Confidentiality. The terms and conditions of the settlement — including, without limitation, the Settlement Amount and any other financial or substantive terms — shall be strictly confidential. Each party shall be permitted to disclose the fact that the litigation has been resolved (i.e., that a settlement has been reached), but neither party shall disclose the specific financial terms, the amount of the Settlement Amount, or the substantive provisions of the settlement agreement, except as follows:

(i) As required by applicable law, regulation, governmental order, or court order, provided that the disclosing party provides prompt written notice to the other party (to the extent permitted by law) and cooperates in seeking confidential treatment or a protective order;

(ii) To each party's respective legal counsel, outside auditors, tax advisors, and insurers, in each case on a need-to-know basis and subject to obligations of confidentiality;

(iii) In the case of VMS, to its equity holders, including Ridgeline Capital Partners Fund IV, LP, as required under applicable governance agreements, partnership agreements, or investor reporting obligations, provided that such disclosures are made subject to the recipient's existing confidentiality obligations; and

(iv) In connection with the enforcement of the settlement agreement or the covenant not to sue.

The settlement agreement shall also include a standard mutual non-disparagement provision, pursuant to which each party shall agree not to make or publish any disparaging, derogatory, or defamatory statements concerning the other party, its products, its services, its officers, directors, or employees, in connection with or related to the subject matter of this litigation or the settlement.

E. Dismissal with Prejudice

Within fourteen (14) calendar days following written confirmation by VMS's counsel that the Settlement Amount has been received by Pinnacle (or Pinnacle's designated payee), the parties shall jointly file a Stipulation of Dismissal with Prejudice dismissing all claims asserted by Pinnacle and all counterclaims asserted by VMS in the above-captioned action, in accordance with Federal Rule of Civil Procedure 41(a)(1)(A)(ii).

The dismissal shall be with prejudice as to all parties and all claims and counterclaims, and without an award of costs or attorneys' fees to either party except as otherwise expressly provided in the settlement agreement. The parties shall cooperate in preparing and filing the Joint Stipulation of Dismissal and any accompanying order required by the Court.

F. Attorneys' Fees and Costs

Each party shall bear its own attorneys' fees, costs, disbursements, and expenses incurred in connection with the above-captioned litigation, including all fees and costs incurred in connection with the negotiation and drafting of the settlement agreement. Neither party shall seek to recover any such fees or costs from the other party, whether by motion, claim, or otherwise.

G. No Precedential Effect

The settlement, the settlement agreement, and all negotiations and communications relating thereto shall have no precedential, collateral estoppel, issue preclusion, or claim preclusion effect in any other action, proceeding, arbitration, or dispute, whether pending or future, involving either party or any third party. The settlement shall not be cited, referenced, or used as evidence of any party's position on any issue in any other forum.

IV. Definitive Agreement

If Pinnacle finds the foregoing terms and conditions acceptable in principle, VMS is prepared to promptly negotiate and execute a definitive Settlement Agreement and Mutual Release (the "Definitive Agreement") that memorializes the terms outlined in this counterproposal in binding, enforceable form.

Upon Pinnacle's acceptance of this counterproposal in writing, VMS's counsel — Calderwood & Harkness LLP — will prepare an initial draft of the Definitive Agreement and circulate it to Whitfield & Gaines PLLC within five (5) business days of receipt of Pinnacle's written acceptance. VMS anticipates that the Definitive Agreement will incorporate the material terms set forth above, together with such additional customary provisions as are appropriate for an agreement of this nature, including representations and warranties, governing law provisions, dispute resolution mechanisms, integration and merger clauses, counterparts provisions, and notice requirements. VMS is prepared to negotiate all such provisions in good faith with a view toward prompt finalization and execution.

V. Expiration of Counterproposal

This counterproposal constitutes VMS's final offer to resolve this litigation on a pre-trial, business-judgment basis and on the terms described herein. Accordingly, this counterproposal shall expire automatically at 5:00 p.m. Central Time on Monday, May 5, 2025, which is twenty-one (21) calendar days from the date of this letter (the "Expiration Date").

If Pinnacle does not accept this counterproposal in writing, or if the parties have not reached agreement in principle on the material terms set forth herein, on or before the Expiration Date, VMS will withdraw this offer in its entirety, without further notice, and will proceed to prepare the case for trial in accordance with the schedule established by the Court. In that event, VMS intends to complete expert discovery, serve its opening and rebuttal expert reports (the Court's current deadline for opening expert reports being May 30, 2025), file dispositive motions on both non-infringement and invalidity grounds, and prepare for the jury trial currently scheduled for October 6, 2025.

VMS reserves all rights, claims, defenses, and counterclaims in the event this counterproposal is not accepted, and the lapse of this counterproposal shall not prejudice VMS's positions in any respect.

VI. Reservation of All Rights

Nothing in this letter or in this counterproposal shall be construed as a waiver, limitation, or modification of any right, defense, counterclaim, or remedy available to VMS in the above-captioned action or in any other proceeding, whether at law or in equity. All such rights are expressly reserved.

This letter and this counterproposal are submitted solely for purposes of settlement negotiations and are made pursuant to Federal Rule of Evidence 408 and any analogous rule of evidence or privilege under applicable state law. This letter, the counterproposal set forth herein, and all related communications and negotiations are inadmissible and may not be offered, received, or used for any purpose — including to prove or disprove the validity of any claim or the amount of any disputed claim — in this action or in any other action, proceeding, arbitration, or dispute.

VMS expressly reserves all rights, defenses, and claims set forth in its Answer and Counterclaims, its affirmative defenses, and all positions taken in this litigation, including without limitation its claim construction positions and its invalidity contentions.

We are hopeful that this counterproposal provides a constructive framework for the prompt resolution of this dispute in a manner that serves the business interests of both parties. I am available to discuss this counterproposal with you by telephone at your earliest convenience and would welcome the opportunity to address any questions or concerns you or your client may have. Please do not hesitate to contact me directly at (313) 555-7218 or by e-mail at mdelgado@calderwoodharkness.com.

Thank you for your attention to this matter. We look forward to your response.

Sincerely,

CALDERWOOD & HARKNESS LLP

By: ________

Marcus Delgado Partner

One Fountain Square, 11th Floor Detroit, Michigan 48226 Direct Dial: (313) 555-7218 E-mail: mdelgado@calderwoodharkness.com

cc: Rachel Nguyen, VP & Associate General Counsel, Vantage Mobility Systems Corp. (via e-mail)

cc: Omar Siddiqui, Esq., Calderwood & Harkness LLP (via e-mail)

cc: Sandra Caldwell, Esq., Caldwell Barrow LLP (via e-mail)

cc: Priya Madan, Esq., Whitfield & Gaines PLLC (via e-mail) (courtesy copy)

Enclosures: None

CONFIDENTIAL SETTLEMENT COMMUNICATION — This letter is submitted pursuant to Federal Rule of Evidence 408 and is protected from disclosure and use in any proceeding. Unauthorized disclosure, copying, or distribution of this communication is strictly prohibited.

CALDERWOOD & HARKNESS LLP
Attorneys at Law
One Fountain Square, 11th Floor Detroit, Michigan 48226 Telephone: (313) 555-7200 Facsimile: (313) 555-7201
1401 McKinney Street, Suite 1900 Houston, Texas 77010 Telephone: (713) 555-4100 Facsimile: (713) 555-4101
www.calderwoodharkness.com
April 14, 2025
VIA E-MAIL AND FIRST CLASS MAIL
Nolan Whitfield, Esq. Whitfield & Gaines PLLC 100 Independence Place, Suite 2800 Tyler, TX 75702
Re: Pinnacle Innovations LLC v. Vantage Mobility Systems Corp., No. 2:24-cv-00187-JRG (E.D. Tex.)
Sub-Ref: Settlement Counterproposal on Behalf of Vantage Mobility Systems Corp.
Dear Mr. Whitfield:
I write on behalf of our client, Vantage Mobility Systems Corp. ("VMS"), the defendant in the above-referenced action, in response to the settlement demand conveyed by your firm on behalf of Pinnacle Innovations LLC ("Pinnacle") in your letter dated March 31, 2025. VMS has given thorough and careful consideration to Pinnacle's demand and the positions expressed therein. While VMS continues to maintain — as it has throughout this litigation — that it does not infringe U.S. Patent No. 9,847,312 B2 (the "'312 Patent") and that the asserted claims of the '312 Patent are invalid, VMS recognizes that the parties share a mutual interest in avoiding the significant costs and substantial business disruption that continued litigation through trial would impose. Accordingly, VMS is prepared to resolve this matter on a business basis, without any concession on the merits, in order to bring this dispute to a prompt and final conclusion.
I am authorized by VMS to transmit the settlement counterproposal set forth below. VMS makes this counterproposal in good faith and in the spirit of commercially reasonable dispute resolution.
I. VMS's Position — Reservation of Rights
At the outset, VMS wishes to make clear that it has not altered its position on the merits of Pinnacle's infringement allegations or on the validity of the '312 Patent. VMS categorically denies that it has infringed, either directly or indirectly, Claims 1, 7, and 14 of the '312 Patent — the only claims asserted by Pinnacle in this action — through the manufacture, sale, offer for sale, use, or importation of the accused VMS DriveLink™ 4.0 telematics control unit and the VMS FleetPulse™ cloud-based fleet management platform. VMS's non-infringement position is well supported by the record, including the claim constructions adopted by this Court.
In particular, VMS respectfully notes that the Court's Claim Construction Order entered on December 19, 2024, construed several disputed claim terms in a manner that VMS believes materially supports its non-infringement position, most notably the Court's construction of the terms "dynamically aggregated telemetry module" and "real-time arbitration protocol" as recited in independent Claims 1 and 14 of the '312 Patent. VMS is confident that its accused products and services do not practice the asserted claims under the constructions adopted by the Court.
VMS further maintains its invalidity defenses under 35 U.S.C. §§ 102 and 103, as well as its counterclaims for declaratory judgment of non-infringement and invalidity, all of which were asserted in VMS's Answer and Counterclaims filed on April 15, 2024. VMS has identified prior art references that it believes are highly relevant to the validity of the asserted claims, and VMS remains prepared to present those references through expert testimony at trial if this matter is not resolved.
Nothing in this letter, in any negotiations related to this counterproposal, or in any settlement agreement that may be reached as a result of these discussions shall constitute, or shall be construed as constituting, an admission by VMS of liability, infringement, or validity of the '312 Patent, or a concession of any kind regarding the merits of Pinnacle's claims or the strength of VMS's defenses and counterclaims. VMS makes this counterproposal solely and exclusively to avoid the considerable expense, management distraction, and business uncertainty associated with the continued prosecution of this litigation through trial.
II. Counterproposal — Settlement Amount
Having carefully evaluated the claims at issue, the applicable claim constructions, the status of discovery, and the costs and risks of further litigation for both parties, VMS proposes the following settlement payment:
VMS proposes a one-time, lump-sum payment of Three Hundred Eighty-Five Thousand Dollars ($385,000.00) (the "Settlement Amount") to Pinnacle, payable in full and final resolution of all claims asserted by Pinnacle and all counterclaims asserted by VMS in the above-captioned action, Pinnacle Innovations LLC v. Vantage Mobility Systems Corp., No. 2:24-cv-00187-JRG (E.D. Tex.).
The Settlement Amount shall be subject to the following payment terms:
(a) The Settlement Amount shall be payable within thirty (30) calendar days following the full execution of a mutually acceptable written settlement agreement by authorized representatives of both Pinnacle and VMS.
(b) Payment shall be made by wire transfer of immediately available funds to a bank account designated by Pinnacle in a written wire instruction letter provided to VMS or its counsel no later than ten (10) business days prior to the payment due date.
(c) The Settlement Amount shall be non-refundable upon payment and shall constitute the sole and exclusive financial consideration to be paid by VMS in connection with the resolution of this matter.
VMS submits that this amount represents a fair and reasonable resolution of this dispute on a business-judgment basis, taking into account the parties' respective litigation positions, the current posture of the case, and the costs that both parties would incur in proceeding through expert discovery, dispositive motions, and trial.
III. Counterproposal — Key Settlement Terms
In addition to the Settlement Amount described above, VMS proposes that any definitive settlement agreement incorporate the following material terms:
A. Covenant Not to Sue
As a condition of the settlement, Pinnacle shall grant to VMS and its affiliates, subsidiaries, parent entities, successors, assigns, customers, distributors, resellers, and end users (collectively, "VMS Released Parties") a perpetual, irrevocable covenant not to sue under:
(i) U.S. Patent No. 9,847,312 B2, including all claims thereof (whether or not asserted in this litigation), and all continuations, continuations-in-part, divisionals, reissues, reexaminations, and foreign counterparts thereof; and
(ii) All other patents and patent applications owned by, assigned to, or controlled by Pinnacle or its affiliates as of the effective date of the settlement agreement (the "Pinnacle Portfolio").
The covenant not to sue shall cover all past, present, and future acts of the VMS Released Parties related to the design, development, manufacture, assembly, testing, use, sale, offer for sale, importation, distribution, marketing, support, maintenance, and update of VMS products and services, including but not limited to the VMS DriveLink™ product line and the VMS FleetPulse™ platform, and all successor, derivative, and related products and services.
For the avoidance of doubt, VMS proposes that the covenant not to sue be structured as a covenant and not as a patent license. VMS does not seek, and the settlement agreement shall not be construed to grant, a license to any patent or patent application in the Pinnacle Portfolio. The distinction between a covenant not to sue and a patent license is material to VMS, and VMS respectfully requests that Pinnacle confirm its agreement to this characterization.
B. Mutual General Releases
Both parties shall exchange mutual general releases of all claims, counterclaims, cross-claims, demands, causes of action, obligations, damages, losses, costs, expenses, and liabilities of any kind or nature whatsoever, whether known or unknown, suspected or unsuspected, asserted or unasserted, accrued or unaccrued, fixed or contingent, that arise from or relate in any way to the litigation captioned Pinnacle Innovations LLC v. Vantage Mobility Systems Corp., No. 2:24-cv-00187-JRG (E.D. Tex.), including but not limited to all claims and counterclaims asserted or that could have been asserted in that action.
The mutual general releases shall be broadly drafted to encompass all claims related to the subject matter of the above-captioned action, including all claims of patent infringement, invalidity, and unenforceability, as well as all claims for damages, injunctive relief, attorneys' fees, costs, and interest. Each party shall release the other party and its respective officers, directors, employees, agents, attorneys, affiliates, subsidiaries, parent entities, successors, and assigns from all such claims and liabilities.
C. No Admission of Liability
The settlement agreement shall contain an express and prominent provision confirming that:
(i) Neither party admits, by entering into the settlement agreement, any liability, fault, wrongdoing, infringement, validity, invalidity, or enforceability or unenforceability of any patent;
(ii) The settlement is entered into solely to avoid the costs and burdens of further litigation and for no other purpose; and
(iii) Neither party shall characterize the settlement, publicly or privately, as reflecting the merits or likely outcome of any claim, defense, or counterclaim asserted in the litigation.
D. Confidentiality. The terms and conditions of the settlement — including, without limitation, the Settlement Amount and any other financial or substantive terms — shall be strictly confidential. Each party shall be permitted to disclose the fact that the litigation has been resolved (i.e., that a settlement has been reached), but neither party shall disclose the specific financial terms, the amount of the Settlement Amount, or the substantive provisions of the settlement agreement, except as follows:
(i) As required by applicable law, regulation, governmental order, or court order, provided that the disclosing party provides prompt written notice to the other party (to the extent permitted by law) and cooperates in seeking confidential treatment or a protective order;
(ii) To each party's respective legal counsel, outside auditors, tax advisors, and insurers, in each case on a need-to-know basis and subject to obligations of confidentiality;
(iii) In the case of VMS, to its equity holders, including Ridgeline Capital Partners Fund IV, LP, as required under applicable governance agreements, partnership agreements, or investor reporting obligations, provided that such disclosures are made subject to the recipient's existing confidentiality obligations; and
(iv) In connection with the enforcement of the settlement agreement or the covenant not to sue.
The settlement agreement shall also include a standard mutual non-disparagement provision, pursuant to which each party shall agree not to make or publish any disparaging, derogatory, or defamatory statements concerning the other party, its products, its services, its officers, directors, or employees, in connection with or related to the subject matter of this litigation or the settlement.
E. Dismissal with Prejudice
Within fourteen (14) calendar days following written confirmation by VMS's counsel that the Settlement Amount has been received by Pinnacle (or Pinnacle's designated payee), the parties shall jointly file a Stipulation of Dismissal with Prejudice dismissing all claims asserted by Pinnacle and all counterclaims asserted by VMS in the above-captioned action, in accordance with Federal Rule of Civil Procedure 41(a)(1)(A)(ii).
The dismissal shall be with prejudice as to all parties and all claims and counterclaims, and without an award of costs or attorneys' fees to either party except as otherwise expressly provided in the settlement agreement. The parties shall cooperate in preparing and filing the Joint Stipulation of Dismissal and any accompanying order required by the Court.
F. Attorneys' Fees and Costs
Each party shall bear its own attorneys' fees, costs, disbursements, and expenses incurred in connection with the above-captioned litigation, including all fees and costs incurred in connection with the negotiation and drafting of the settlement agreement. Neither party shall seek to recover any such fees or costs from the other party, whether by motion, claim, or otherwise.
G. No Precedential Effect
The settlement, the settlement agreement, and all negotiations and communications relating thereto shall have no precedential, collateral estoppel, issue preclusion, or claim preclusion effect in any other action, proceeding, arbitration, or dispute, whether pending or future, involving either party or any third party. The settlement shall not be cited, referenced, or used as evidence of any party's position on any issue in any other forum.
IV. Definitive Agreement
If Pinnacle finds the foregoing terms and conditions acceptable in principle, VMS is prepared to promptly negotiate and execute a definitive Settlement Agreement and Mutual Release (the "Definitive Agreement") that memorializes the terms outlined in this counterproposal in binding, enforceable form.
Upon Pinnacle's acceptance of this counterproposal in writing, VMS's counsel — Calderwood & Harkness LLP — will prepare an initial draft of the Definitive Agreement and circulate it to Whitfield & Gaines PLLC within five (5) business days of receipt of Pinnacle's written acceptance. VMS anticipates that the Definitive Agreement will incorporate the material terms set forth above, together with such additional customary provisions as are appropriate for an agreement of this nature, including representations and warranties, governing law provisions, dispute resolution mechanisms, integration and merger clauses, counterparts provisions, and notice requirements. VMS is prepared to negotiate all such provisions in good faith with a view toward prompt finalization and execution.
V. Expiration of Counterproposal
This counterproposal constitutes VMS's final offer to resolve this litigation on a pre-trial, business-judgment basis and on the terms described herein. Accordingly, this counterproposal shall expire automatically at 5:00 p.m. Central Time on Monday, May 5, 2025, which is twenty-one (21) calendar days from the date of this letter (the "Expiration Date").
If Pinnacle does not accept this counterproposal in writing, or if the parties have not reached agreement in principle on the material terms set forth herein, on or before the Expiration Date, VMS will withdraw this offer in its entirety, without further notice, and will proceed to prepare the case for trial in accordance with the schedule established by the Court. In that event, VMS intends to complete expert discovery, serve its opening and rebuttal expert reports (the Court's current deadline for opening expert reports being May 30, 2025), file dispositive motions on both non-infringement and invalidity grounds, and prepare for the jury trial currently scheduled for October 6, 2025.
VMS reserves all rights, claims, defenses, and counterclaims in the event this counterproposal is not accepted, and the lapse of this counterproposal shall not prejudice VMS's positions in any respect.
VI. Reservation of All Rights
Nothing in this letter or in this counterproposal shall be construed as a waiver, limitation, or modification of any right, defense, counterclaim, or remedy available to VMS in the above-captioned action or in any other proceeding, whether at law or in equity. All such rights are expressly reserved.
This letter and this counterproposal are submitted solely for purposes of settlement negotiations and are made pursuant to Federal Rule of Evidence 408 and any analogous rule of evidence or privilege under applicable state law. This letter, the counterproposal set forth herein, and all related communications and negotiations are inadmissible and may not be offered, received, or used for any purpose — including to prove or disprove the validity of any claim or the amount of any disputed claim — in this action or in any other action, proceeding, arbitration, or dispute.
VMS expressly reserves all rights, defenses, and claims set forth in its Answer and Counterclaims, its affirmative defenses, and all positions taken in this litigation, including without limitation its claim construction positions and its invalidity contentions.
We are hopeful that this counterproposal provides a constructive framework for the prompt resolution of this dispute in a manner that serves the business interests of both parties. I am available to discuss this counterproposal with you by telephone at your earliest convenience and would welcome the opportunity to address any questions or concerns you or your client may have. Please do not hesitate to contact me directly at (313) 555-7218 or by e-mail at mdelgado@calderwoodharkness.com.
Thank you for your attention to this matter. We look forward to your response.
Sincerely,
CALDERWOOD & HARKNESS LLP
By: ________
Marcus Delgado Partner
One Fountain Square, 11th Floor Detroit, Michigan 48226 Direct Dial: (313) 555-7218 E-mail: mdelgado@calderwoodharkness.com
cc: Rachel Nguyen, VP & Associate General Counsel, Vantage Mobility Systems Corp. (via e-mail)
cc: Omar Siddiqui, Esq., Calderwood & Harkness LLP (via e-mail)
cc: Sandra Caldwell, Esq., Caldwell Barrow LLP (via e-mail)
cc: Priya Madan, Esq., Whitfield & Gaines PLLC (via e-mail) (courtesy copy)
Enclosures: None
CONFIDENTIAL SETTLEMENT COMMUNICATION — This letter is submitted pursuant to Federal Rule of Evidence 408 and is protected from disclosure and use in any proceeding. Unauthorized disclosure, copying, or distribution of this communication is strictly prohibited.

CALDERWOOD & HARKNESS LLP

VIA E-MAIL AND FIRST CLASS MAIL

CALDERWOOD & HARKNESS LLP

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