1009-00002 · Client 1009 · Engagement

engagement-letter-skybridge-series-b.docx DOCUMENT Funds

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CALDERWOOD & HARKNESS LLP Attorneys at Law 919 N. Market Street, Suite 1500 Wilmington, DE 19801

May 5, 2022

Mr. Naveen Raghavan Co-Founder & Chief Executive Officer Skybridge Fintech Ltd. 1600 Market Street, Suite 2200 Wilmington, DE 19801

Mr. David Okonkwo Chief Financial Officer Skybridge Fintech Ltd. 1600 Market Street, Suite 2200 Wilmington, DE 19801

Re: Engagement of Calderwood & Harkness LLP as Issuer's Counsel — Series B Preferred Stock Financing Internal Matter Number: 1009-00002

Dear Mr. Raghavan and Mr. Okonkwo:

Thank you for selecting Calderwood & Harkness LLP to serve as outside counsel to Skybridge Fintech Ltd. in connection with its proposed Series B Preferred Stock financing. We are pleased to confirm the terms and conditions of our engagement in this letter. We ask that you review the following carefully and, if the terms are acceptable, execute and return a countersigned copy of this letter to our offices at the address listed above.

1. Introduction and Purpose

This letter confirms that Skybridge Fintech Ltd., a corporation organized and existing under the laws of the State of Delaware (EIN: 84-3291057) ("Skybridge" or the "Company"), has retained Calderwood & Harkness LLP ("C&H" or the "Firm") to serve as outside counsel to the Company in its capacity as the issuer in connection with the Company's proposed Series B Preferred Stock financing (the "Financing"). The Financing contemplates the issuance and sale by the Company of shares of its Series B Preferred Stock to certain institutional and accredited investors for aggregate gross proceeds of approximately Forty-Five Million Dollars ($45,000,000).

The principal terms of the Financing are set forth in that certain Term Sheet, dated April 22, 2022 (the "Term Sheet"), executed among the Company and the lead investor, Granite Peak Ventures, LP. As you are aware, the Term Sheet is non-binding in all respects except for the customary exclusivity, confidentiality, and expense provisions contained therein, and the definitive terms of the Financing will be established through the negotiation and execution of the definitive transaction documents described in Section 2 below.

This engagement letter (the "Engagement Letter") sets forth the terms and conditions governing C&H's representation of the Company in the Financing, including the scope of our engagement, the composition of the engagement team, fee arrangements, and other matters relevant to the attorney-client relationship. This Engagement Letter supersedes any prior oral or written understandings between C&H and the Company regarding the Financing and constitutes the entire agreement between the parties with respect to the subject matter hereof.

2. Scope of Representation

C&H will represent Skybridge solely in its capacity as the issuer in the Financing. Our representation will encompass the tasks and responsibilities enumerated below, together with such additional matters as may be reasonably necessary and incident thereto in order to consummate the Financing and close the transactions contemplated by the definitive transaction documents.

The specific tasks within the scope of this engagement are as follows:

(a) Definitive Transaction Documents. Drafting, negotiating, and finalizing the definitive transaction documents for the Financing, which are anticipated to include the following:

(i) the Series B Preferred Stock Purchase Agreement (the "Stock Purchase Agreement" or "SPA"), setting forth the terms and conditions of the purchase and sale of shares of Series B Preferred Stock, representations and warranties of the Company and the Purchasers, conditions to closing, and related matters;

(ii) the Amended and Restated Certificate of Incorporation of the Company (the "Restated Certificate"), which will recapitalize and restate the full preferred stock stack of the Company, including the terms, preferences, privileges, and rights of the Series Seed Preferred Stock, Series A Preferred Stock, and Series B Preferred Stock, as well as the authorized shares of Common Stock;

(iii) the Amended and Restated Investors' Rights Agreement, setting forth registration rights, information rights, rights of participation in future financings, and related matters among the Company, the Series B investors, and the holders of existing preferred stock;

(iv) the Amended and Restated Right of First Refusal and Co-Sale Agreement, governing restrictions on transfer of shares by certain stockholders, including the right of first refusal and co-sale rights in favor of the preferred stock holders; and

(v) the Amended and Restated Voting Agreement, setting forth the rights and obligations of certain stockholders and the Company with respect to the election of the Board of Directors and other matters requiring stockholder approval.

(b) Ancillary Closing Documents. Preparing ancillary closing documents necessary or customary for the consummation of the Financing, including, without limitation:

(i) board consents and resolutions (which are expected to be effected by written consent of the Board of Directors in lieu of a meeting, pursuant to Section 141(f) of the Delaware General Corporation Law);

(ii) an officer's certificate and secretary's certificate to be delivered at closing in satisfaction of closing conditions;

(iii) the Company's disclosure schedules to the Stock Purchase Agreement; and

(iv) management rights letters for those investors requiring such letters in order to maintain their status as a "venture capital operating company" under the regulations promulgated under the Employee Retirement Income Security Act of 1974, as amended.

(c) Legal Opinion. Delivery of a legal opinion of issuer's counsel at the closing of the Financing, addressed to the Purchasers under the Stock Purchase Agreement, regarding, among other things, the due organization and good standing of the Company, the due authorization of the transaction documents by the Company, the valid issuance of the shares of Series B Preferred Stock, the absence of conflicts with the Company's organizational documents and applicable law, and such other customary matters as may be reasonably requested by the Purchasers and their counsel. The scope of the legal opinion will be subject to customary assumptions, qualifications, and limitations.

(d) Certificate of Incorporation Filing. Coordinating the preparation and filing of the Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware, including arranging for expedited filing if required by the closing timeline, and obtaining a certified copy of the filed instrument for the Company's records.

(e) Capitalization Analysis and Liquidation Waterfall Memorandum. Preparing a capitalization analysis and liquidation waterfall memorandum for the Company's internal use, analyzing the post-Series B preferred stock stack, including the terms of the Series Seed Preferred Stock, Series A Preferred Stock, and Series B Preferred Stock, as well as conversion economics, anti-dilution mechanics, and aggregate liquidation preferences at various exit scenarios. This memorandum will be prepared for the sole benefit of the Company and will not be addressed to, or intended for reliance by, any third party.

(f) Option Pool Increase. Assisting the Company with the increase of the option pool under the Skybridge Fintech Ltd. 2018 Equity Incentive Plan (the "Plan"), as contemplated by the Term Sheet, by an additional 1,635,000 shares of Common Stock, bringing the total shares reserved for issuance under the Plan to 4,635,000 shares, which is expected to constitute approximately fifteen percent (15%) of the post-closing fully diluted capitalization of the Company (based on anticipated post-closing fully diluted shares outstanding of 30,900,000). This work will include preparation of the requisite board and stockholder approvals and preparation or review of amendments to the Plan.

(g) Closing Logistics. Coordinating closing logistics for the Financing, including:

(i) preparation and maintenance of a comprehensive closing checklist, tracking the status of all deliverables and conditions to closing;

(ii) liaising with the escrow agent, Pinnacle National Bank, N.A., regarding the establishment and operation of any escrow account utilized in connection with the closing, including the preparation or review of escrow instructions;

(iii) coordinating stock certificate issuance (or book-entry notation) with the Company's transfer agent, Ledgermark Transfer Services, Inc., including delivery of irrevocable transfer agent instructions following the closing; and

(iv) assembling and circulating the closing binder to all parties following the closing.

(h) Placement Agent Matters. Reviewing and advising the Company on its engagement of the Company's placement agent, Compass Bridge Advisory Group LLC, including review of the placement agent agreement, fee arrangements, and any related representations, warranties, or indemnification obligations of the Company in connection therewith.

The definitive transaction documents will be based on the model venture capital financing documents published by the National Venture Capital Association (the "NVCA model documents (2020 edition)"), customized and tailored as appropriate to reflect the specific terms of the Financing, the Term Sheet, and the Company's existing organizational documents and prior financing agreements.

Matters Outside the Scope of this Engagement. For the avoidance of doubt, the scope of this engagement does not include the following:

(i) Tax advice. C&H will not provide tax advice in connection with the Financing. The Company should consult with its independent tax advisors regarding the tax consequences of the issuance of Series B Preferred Stock, the option pool increase, and any other tax-related matters arising from the Financing. While certain members of our engagement team have tax practice backgrounds, no aspect of our work product in this engagement should be construed as tax advice, and the Company should not rely on any communications from C&H in connection with this engagement as constituting tax advice.

(ii) Securities-law compliance in jurisdictions other than Delaware and federal. C&H will not advise on, or be responsible for, securities-law filings or compliance in any state other than Delaware or under any non-U.S. securities laws. The Company should consult with its own advisors or retain separate counsel with respect to any state "blue sky" notice filings or foreign regulatory requirements that may be applicable to the offer and sale of the Series B Preferred Stock.

(iii) intellectual property opinions. C&H will not provide opinions regarding the validity, scope, enforceability, or ownership of the Company's intellectual property. If an intellectual property opinion or freedom-to-operate analysis is required in connection with the Financing, the Company should engage intellectual property counsel for that purpose.

(iv) Representation of any investor. C&H does not and will not represent any investor, purchaser, or prospective purchaser in the Financing, including, without limitation, Granite Peak Ventures, LP, Ridgeline Capital Partners, LLC, Solstice Growth Fund I, LP, or any other person or entity acquiring shares of Series B Preferred Stock.

The investors participating in the Financing are separately represented by Fenwick, Pratt & Howell LLP (555 California Street, Suite 4000, San Francisco, CA 94104), with lead attorney Katherine "Kate" Linfield, Partner, serving as primary counsel for the investor group. C&H will coordinate with Ms. Linfield and her colleagues at Fenwick, Pratt & Howell on document negotiations, closing logistics, and other matters as customary in transactions of this nature.

If, during the course of this engagement, additional legal matters arise that are outside the scope described above, C&H will notify the Company and discuss whether such matters should be undertaken as part of this engagement (subject to an adjustment of the fee cap, if appropriate) or addressed separately.

3. Engagement Team

The following attorneys have been assigned to this matter and will serve as the principal members of the engagement team:

Miriam Calloway, Partner — Responsible Partner. Ms. Calloway will serve as the primary client contact and will have overall supervisory responsibility for the engagement, including the review and approval of all material work product and communications with investors' counsel. Ms. Calloway's primary practice area is Healthcare & Life Sciences; however, she has extensive experience representing emerging-growth companies in venture capital financings and related corporate transactions and is well suited to lead this engagement on behalf of the Company.

Joel Strauss, Partner — Billing Partner. Mr. Strauss will be responsible for all billing, budgeting, and fee-related matters in connection with this engagement. Mr. Strauss is also a member of the Firm's Healthcare & Life Sciences practice group and will provide substantive support to the engagement team as needed. Any billing inquiries should be directed to Mr. Strauss.

Robert Jansen, Associate — Lead Associate. Mr. Jansen will handle the day-to-day drafting of transaction documents, coordinate with investors' counsel on document comments and markup, and serve as the primary point of contact for routine transactional matters. Mr. Jansen's practice background is in Tax, which provides him with a useful perspective on the capitalization analysis and related matters, though, as noted above, the Firm is not providing tax advice in this engagement.

Amy Chesterton, Associate — Working Associate. Ms. Chesterton will assist with closing logistics, management of the closing checklist, preparation of ancillary closing documents, and such other tasks as may be assigned by the Responsible Partner. Ms. Chesterton's prior practice experience is in Bankruptcy & Restructuring, and she brings strong organizational skills and document-management discipline to the engagement team.

From time to time, additional attorneys, paralegals, or other professional staff may be assigned to the engagement as the needs of the matter require. C&H will provide notice to the Company of any material changes to the composition of the engagement team. The billing rates for any additional personnel assigned to the engagement will be consistent with the rate ranges set forth in Section 4.2 below.

4. Fees and Billing

4.1 Fee Cap

The total legal fees for C&H's services rendered in connection with the Financing engagement shall be capped at One Hundred Seventy-Five Thousand Dollars ($175,000) (the "Fee Cap"). The Fee Cap covers all attorney and professional staff time incurred from the date of this Engagement Letter through the closing of the Financing and through the completion of post-closing administrative matters directly related to the Financing, including the assembly and distribution of closing binders, post-closing filings, and the delivery of the final capitalization analysis and liquidation waterfall memorandum.

C&H will not bill the Company for legal fees in excess of the Fee Cap without the prior written consent of the Company. In the event that the scope of the engagement is materially expanded beyond the tasks described in Section 2 above (for example, if the Financing requires a restructuring of the existing preferred stock terms beyond what is contemplated by the Term Sheet, or if unanticipated regulatory issues arise), C&H and the Company will discuss in good faith whether an adjustment to the Fee Cap is appropriate, and any such adjustment will be documented in a written amendment to this Engagement Letter signed by both parties.

For the avoidance of doubt, the Fee Cap covers legal fees only. Disbursements and out-of-pocket expenses are addressed separately in Section 4.3 below and are not subject to the Fee Cap.

4.2 Billing Rates

For purposes of transparency and to provide the Company with visibility into the composition of our fees, and also for application in the event the Fee Cap is waived or the scope of the engagement is expanded, the current standard hourly billing rates for the members of the engagement team are as follows:

C&H's standard practice is to adjust billing rates annually, typically effective January 1 of each calendar year. Notwithstanding the foregoing, the billing rates set forth above will remain fixed for the duration of this engagement and will not be adjusted during the term of this Engagement Letter.

4.3 Disbursements and Expenses

The Fee Cap set forth in Section 4.1 is exclusive of out-of-pocket disbursements and expenses, which will be billed to the Company at cost without markup. Examples of disbursements and expenses that may be incurred in connection with this engagement include, without limitation:

• filing fees, including the filing fee payable to the Secretary of State of the State of Delaware in connection with the filing of the Amended and Restated Certificate of Incorporation (and any related expedited processing fees);

• courier and overnight delivery charges;

• travel expenses, if any (subject to the Company's prior approval for any travel expenses exceeding $500 in the aggregate);

• charges for online legal research databases (e.g., Westmark Data Systems, Calderon Systems);

• photocopying and printing charges in excess of ordinary amounts incurred in the preparation of closing binders and signature pages; and

• any fees charged by Pinnacle National Bank, N.A. or Ledgermark Transfer Services, Inc. that are passed through to C&H for payment (though such fees are typically billed directly to the Company by the applicable service provider).

Based on our experience with transactions of similar size and complexity, we estimate that total disbursements and expenses for this engagement will be in the range of approximately $2,000 to $5,000. We will endeavor to keep these costs to a minimum and will promptly notify the Company if it appears that disbursements may exceed the upper end of this estimate.

4.4 Billing and Payment Terms

C&H will render monthly invoices to the Company for fees incurred and disbursements advanced during the preceding billing period. Each invoice will contain a reasonably detailed summary of time entries (including the date, attorney or staff member, hours worked, and a description of the services performed) and an itemization of disbursements and expenses. Invoices will be sent to the attention of Mr. David Okonkwo, Chief Financial Officer, at the Company's address set forth above, or to such other address or email address as the Company may designate in writing from time to time.

Invoices are due and payable within thirty (30) days of the date of the invoice. If the Company has a question or dispute regarding any item on an invoice, the Company should contact Billing Partner Joel Strauss promptly so that the matter can be addressed. Payment of undisputed amounts should not be withheld pending resolution of any disputed items.

The Company acknowledges that, pursuant to the terms of the Stock Purchase Agreement, the Company has agreed to reimburse investors' counsel, Fenwick, Pratt & Howell LLP, for legal fees incurred in connection with the Financing, capped at Seventy-Five Thousand Dollars ($75,000), plus reasonable out-of-pocket disbursements, payable at the closing of the Financing. This reimbursement obligation is the Company's obligation under the Stock Purchase Agreement and is entirely separate from, and in addition to, the fees and disbursements payable to C&H under this Engagement Letter.

5. Client Identity and Conflicts

C&H's client in this engagement is Skybridge Fintech Ltd. — the corporate entity. C&H does not represent, and this engagement shall not be construed to create an attorney-client relationship with, any individual officer, director, employee, stockholder, or affiliate of the Company in their personal capacity. Without limiting the generality of the foregoing, C&H does not represent Mr. Naveen Raghavan, Mr. David Okonkwo, or any other officer or director of the Company in their individual capacities, and no communication from C&H to any individual should be understood as constituting personal legal advice to that individual. Individual officers, directors, and stockholders should consider retaining their own separate counsel to advise them regarding their personal interests in connection with the Financing, to the extent they deem it necessary or appropriate.

C&H does not represent, and will not represent, any investor, purchaser, or prospective purchaser of shares of Series B Preferred Stock in connection with the Financing, including, without limitation, Granite Peak Ventures, LP, Ridgeline Capital Partners, LLC, Solstice Growth Fund I, LP, or any of their respective affiliates, general partners, limited partners, members, managers, or advisors. The investors are separately represented by their own counsel as described in Section 2 above.

C&H has conducted a thorough conflicts check in accordance with the Firm's standard procedures and the applicable Delaware Rules of Professional Conduct, and we confirm that, as of the date of this Engagement Letter, C&H is not aware of any current conflict of interest that would preclude or impair the Firm's ability to represent the Company in this engagement. In the event that a conflict of interest arises during the course of the engagement, C&H will promptly notify the Company and will address the conflict in accordance with the applicable rules of professional responsibility, which may include, depending on the nature and severity of the conflict, seeking the Company's informed written consent to continued representation, implementing an ethical screen or other protective measures within the Firm, or, if the conflict is not waivable, withdrawing from the engagement.

6. Confidentiality and Privilege

All communications between C&H and the Company, and all documents and materials prepared by C&H in connection with this engagement, are intended to be protected by the attorney-client privilege, the work-product doctrine, and any other applicable privileges or protections. C&H will take reasonable measures to preserve the confidentiality and privileged nature of such communications and materials.

C&H will maintain the confidentiality of all non-public information received from the Company in connection with this engagement and will not disclose such information to any third party without the Company's prior written consent, except as may be required by applicable law, regulation, or court order, or as may be necessary in connection with the performance of our duties under this Engagement Letter (including, for example, the inclusion of factual information in transaction documents that will be shared with the investors and their counsel in the ordinary course of negotiations).

The Company acknowledges and understands that information shared with the investors and their counsel, Fenwick, Pratt & Howell LLP, in the course of due diligence, document negotiations, and other customary interactions during the Financing process may not be subject to the attorney-client privilege or work-product protection. The voluntary disclosure of confidential or privileged information to third parties, including the investors and their counsel, may, in certain circumstances, constitute a waiver of the privilege with respect to the disclosed information. C&H will exercise professional judgment in determining what information is appropriately shared in the context of the Financing and will consult with the Company before disclosing any information that, in C&H's judgment, may be particularly sensitive.

7. Document Retention

C&H will retain the engagement files relating to this matter, including correspondence, drafts, memoranda, and work product, for a period of seven (7) years following the conclusion of the engagement (whether by completion of the Financing, termination, or otherwise). At the expiration of such seven-year retention period, C&H may destroy or dispose of the engagement files in the ordinary course of the Firm's records-management practices, without further notice to the Company.

The Company may request the return of original documents (including original signed agreements, certificates, and other instruments) at any time during or after the engagement, and C&H will promptly comply with any such request. C&H may retain copies of such original documents for its files. The Company acknowledges that C&H is not a custodian of the Company's corporate records and that the Company is responsible for maintaining its own complete corporate records.

8. Termination

Either party may terminate this engagement at any time, with or without cause, upon written notice to the other party. Termination by the Company shall be effective upon receipt of written notice by C&H. Termination by C&H shall be subject to the Firm's obligations under applicable rules of professional conduct, including the obligation to provide reasonable notice to the Company and to take steps to protect the Company's interests to the extent reasonably practicable.

Upon termination of the engagement, the Company will remain responsible for all fees and disbursements incurred through the effective date of termination. C&H will render a final invoice within thirty (30) days following the effective date of termination. C&H will cooperate in good faith in the orderly transition of the matter to successor counsel designated by the Company, including making available the engagement files and providing reasonable assistance to successor counsel to ensure continuity of the Company's interests.

Nothing in this Section 8 shall be construed to relieve either party of its obligations under Sections 6 (Confidentiality and Privilege) and 7 (Document Retention), which shall survive the termination of the engagement.

9. Governing Law

This Engagement Letter shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any principles of conflict of laws that would require the application of the laws of any other jurisdiction. Any dispute arising out of or relating to this Engagement Letter shall be subject to the exclusive jurisdiction of the state and federal courts located in Wilmington, Delaware, and each party hereby consents to the personal jurisdiction of such courts.

10. No Guarantee of Outcome

C&H will use its best professional efforts to provide competent and diligent legal representation to the Company in connection with the Financing. However, the Company understands and acknowledges that C&H cannot and does not guarantee any particular outcome of the Financing, including, without limitation, the successful closing of the Financing, the receipt of the anticipated gross proceeds, or the final terms of the definitive transaction documents. The outcome of any legal matter depends on range factors, many of which are outside the control of legal counsel, and the Company acknowledges that no representation or assurance has been made by C&H regarding the outcome of this engagement.

11. Acceptance and Counterparts

We respectfully request that the Company indicate its acceptance of the terms and conditions set forth in this Engagement Letter by having authorized representatives of the Company countersign this letter in the space provided below and return an executed copy to the Firm at the address indicated above, or by electronic delivery to Miriam Calloway at mcalloway@calderwoodharkness.com. Upon receipt of the countersigned letter, C&H will commence work on the engagement.

This Engagement Letter may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Counterparts may be delivered by facsimile, electronic mail (including PDF), or other electronic transmission, and any counterpart so delivered shall be deemed to have been duly and validly delivered and shall be valid and effective for all purposes.

If you have any questions regarding the terms of this Engagement Letter, please do not hesitate to contact Miriam Calloway at (302) 555-4200 or mcalloway@calderwoodharkness.com. We look forward to working with you and the Skybridge team on this exciting milestone for the Company.

[Signature Page Follows]

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Name: Miriam Calloway

Title: Partner — Responsible Partner

By: ________

Name: Joel Strauss

Title: Partner — Billing Partner

919 N. Market Street, Suite 1500 Wilmington, DE 19801

ACKNOWLEDGMENT AND ACCEPTANCE

By executing below, the undersigned, on behalf of Skybridge Fintech Ltd., acknowledge receipt of this Engagement Letter, confirm that they have read and understood its terms and conditions, and agree to be bound by the terms set forth herein.

ACKNOWLEDGED AND AGREED:

SKYBRIDGE FINTECH LTD.

By: ________

Name: Naveen Raghavan

Title: Co-Founder & Chief Executive Officer

Date: ________

By: ________

Name: David Okonkwo

Title: Chief Financial Officer

Date: ________

Address:

1600 Market Street, Suite 2200 Wilmington, DE 19801

Enclosures: None. The Firm's standard terms of engagement, to the extent supplemental to the terms set forth herein, are incorporated herein by reference. A copy of such standard terms is available upon request.

PRIVILEGED & CONFIDENTIAL — ATTORNEY-CLIENT COMMUNICATION

For the avoidance of doubt, the Client, Skybridge Fintech Ltd., is a portfolio company of Pinnacle Venture Fund II LP, and certain consents and reporting obligations to the sponsor may apply in connection with this matter.

Attorney / Staff	Role	Hourly Rate
Miriam Calloway, Partner	Responsible Partner	$895
Joel Strauss, Partner	Billing Partner	$875
Robert Jansen, Associate	Lead Associate	$525
Amy Chesterton, Associate	Working Associate	$450
Paralegal / Support Staff	Various	$250 – $325

CALDERWOOD & HARKNESS LLP Attorneys at Law 919 N. Market Street, Suite 1500 Wilmington, DE 19801
May 5, 2022
Mr. Naveen Raghavan Co-Founder & Chief Executive Officer Skybridge Fintech Ltd. 1600 Market Street, Suite 2200 Wilmington, DE 19801
Mr. David Okonkwo Chief Financial Officer Skybridge Fintech Ltd. 1600 Market Street, Suite 2200 Wilmington, DE 19801
Re: Engagement of Calderwood & Harkness LLP as Issuer's Counsel — Series B Preferred Stock Financing Internal Matter Number: 1009-00002
Dear Mr. Raghavan and Mr. Okonkwo:
Thank you for selecting Calderwood & Harkness LLP to serve as outside counsel to Skybridge Fintech Ltd. in connection with its proposed Series B Preferred Stock financing. We are pleased to confirm the terms and conditions of our engagement in this letter. We ask that you review the following carefully and, if the terms are acceptable, execute and return a countersigned copy of this letter to our offices at the address listed above.
1. Introduction and Purpose
This letter confirms that Skybridge Fintech Ltd., a corporation organized and existing under the laws of the State of Delaware (EIN: 84-3291057) ("Skybridge" or the "Company"), has retained Calderwood & Harkness LLP ("C&H" or the "Firm") to serve as outside counsel to the Company in its capacity as the issuer in connection with the Company's proposed Series B Preferred Stock financing (the "Financing"). The Financing contemplates the issuance and sale by the Company of shares of its Series B Preferred Stock to certain institutional and accredited investors for aggregate gross proceeds of approximately Forty-Five Million Dollars ($45,000,000).
The principal terms of the Financing are set forth in that certain Term Sheet, dated April 22, 2022 (the "Term Sheet"), executed among the Company and the lead investor, Granite Peak Ventures, LP. As you are aware, the Term Sheet is non-binding in all respects except for the customary exclusivity, confidentiality, and expense provisions contained therein, and the definitive terms of the Financing will be established through the negotiation and execution of the definitive transaction documents described in Section 2 below.
This engagement letter (the "Engagement Letter") sets forth the terms and conditions governing C&H's representation of the Company in the Financing, including the scope of our engagement, the composition of the engagement team, fee arrangements, and other matters relevant to the attorney-client relationship. This Engagement Letter supersedes any prior oral or written understandings between C&H and the Company regarding the Financing and constitutes the entire agreement between the parties with respect to the subject matter hereof.
2. Scope of Representation
C&H will represent Skybridge solely in its capacity as the issuer in the Financing. Our representation will encompass the tasks and responsibilities enumerated below, together with such additional matters as may be reasonably necessary and incident thereto in order to consummate the Financing and close the transactions contemplated by the definitive transaction documents.
The specific tasks within the scope of this engagement are as follows:
(a) Definitive Transaction Documents. Drafting, negotiating, and finalizing the definitive transaction documents for the Financing, which are anticipated to include the following:
(i) the Series B Preferred Stock Purchase Agreement (the "Stock Purchase Agreement" or "SPA"), setting forth the terms and conditions of the purchase and sale of shares of Series B Preferred Stock, representations and warranties of the Company and the Purchasers, conditions to closing, and related matters;
(ii) the Amended and Restated Certificate of Incorporation of the Company (the "Restated Certificate"), which will recapitalize and restate the full preferred stock stack of the Company, including the terms, preferences, privileges, and rights of the Series Seed Preferred Stock, Series A Preferred Stock, and Series B Preferred Stock, as well as the authorized shares of Common Stock;
(iii) the Amended and Restated Investors' Rights Agreement, setting forth registration rights, information rights, rights of participation in future financings, and related matters among the Company, the Series B investors, and the holders of existing preferred stock;
(iv) the Amended and Restated Right of First Refusal and Co-Sale Agreement, governing restrictions on transfer of shares by certain stockholders, including the right of first refusal and co-sale rights in favor of the preferred stock holders; and
(v) the Amended and Restated Voting Agreement, setting forth the rights and obligations of certain stockholders and the Company with respect to the election of the Board of Directors and other matters requiring stockholder approval.
(b) Ancillary Closing Documents. Preparing ancillary closing documents necessary or customary for the consummation of the Financing, including, without limitation:
(i) board consents and resolutions (which are expected to be effected by written consent of the Board of Directors in lieu of a meeting, pursuant to Section 141(f) of the Delaware General Corporation Law);
(ii) an officer's certificate and secretary's certificate to be delivered at closing in satisfaction of closing conditions;
(iii) the Company's disclosure schedules to the Stock Purchase Agreement; and
(iv) management rights letters for those investors requiring such letters in order to maintain their status as a "venture capital operating company" under the regulations promulgated under the Employee Retirement Income Security Act of 1974, as amended.
(c) Legal Opinion. Delivery of a legal opinion of issuer's counsel at the closing of the Financing, addressed to the Purchasers under the Stock Purchase Agreement, regarding, among other things, the due organization and good standing of the Company, the due authorization of the transaction documents by the Company, the valid issuance of the shares of Series B Preferred Stock, the absence of conflicts with the Company's organizational documents and applicable law, and such other customary matters as may be reasonably requested by the Purchasers and their counsel. The scope of the legal opinion will be subject to customary assumptions, qualifications, and limitations.
(d) Certificate of Incorporation Filing. Coordinating the preparation and filing of the Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware, including arranging for expedited filing if required by the closing timeline, and obtaining a certified copy of the filed instrument for the Company's records.
(e) Capitalization Analysis and Liquidation Waterfall Memorandum. Preparing a capitalization analysis and liquidation waterfall memorandum for the Company's internal use, analyzing the post-Series B preferred stock stack, including the terms of the Series Seed Preferred Stock, Series A Preferred Stock, and Series B Preferred Stock, as well as conversion economics, anti-dilution mechanics, and aggregate liquidation preferences at various exit scenarios. This memorandum will be prepared for the sole benefit of the Company and will not be addressed to, or intended for reliance by, any third party.
(f) Option Pool Increase. Assisting the Company with the increase of the option pool under the Skybridge Fintech Ltd. 2018 Equity Incentive Plan (the "Plan"), as contemplated by the Term Sheet, by an additional 1,635,000 shares of Common Stock, bringing the total shares reserved for issuance under the Plan to 4,635,000 shares, which is expected to constitute approximately fifteen percent (15%) of the post-closing fully diluted capitalization of the Company (based on anticipated post-closing fully diluted shares outstanding of 30,900,000). This work will include preparation of the requisite board and stockholder approvals and preparation or review of amendments to the Plan.
(g) Closing Logistics. Coordinating closing logistics for the Financing, including:
(i) preparation and maintenance of a comprehensive closing checklist, tracking the status of all deliverables and conditions to closing;
(ii) liaising with the escrow agent, Pinnacle National Bank, N.A., regarding the establishment and operation of any escrow account utilized in connection with the closing, including the preparation or review of escrow instructions;
(iii) coordinating stock certificate issuance (or book-entry notation) with the Company's transfer agent, Ledgermark Transfer Services, Inc., including delivery of irrevocable transfer agent instructions following the closing; and
(iv) assembling and circulating the closing binder to all parties following the closing.
(h) Placement Agent Matters. Reviewing and advising the Company on its engagement of the Company's placement agent, Compass Bridge Advisory Group LLC, including review of the placement agent agreement, fee arrangements, and any related representations, warranties, or indemnification obligations of the Company in connection therewith.
The definitive transaction documents will be based on the model venture capital financing documents published by the National Venture Capital Association (the "NVCA model documents (2020 edition)"), customized and tailored as appropriate to reflect the specific terms of the Financing, the Term Sheet, and the Company's existing organizational documents and prior financing agreements.
Matters Outside the Scope of this Engagement. For the avoidance of doubt, the scope of this engagement does not include the following:
(i) Tax advice. C&H will not provide tax advice in connection with the Financing. The Company should consult with its independent tax advisors regarding the tax consequences of the issuance of Series B Preferred Stock, the option pool increase, and any other tax-related matters arising from the Financing. While certain members of our engagement team have tax practice backgrounds, no aspect of our work product in this engagement should be construed as tax advice, and the Company should not rely on any communications from C&H in connection with this engagement as constituting tax advice.
(ii) Securities-law compliance in jurisdictions other than Delaware and federal. C&H will not advise on, or be responsible for, securities-law filings or compliance in any state other than Delaware or under any non-U.S. securities laws. The Company should consult with its own advisors or retain separate counsel with respect to any state "blue sky" notice filings or foreign regulatory requirements that may be applicable to the offer and sale of the Series B Preferred Stock.
(iii) intellectual property opinions. C&H will not provide opinions regarding the validity, scope, enforceability, or ownership of the Company's intellectual property. If an intellectual property opinion or freedom-to-operate analysis is required in connection with the Financing, the Company should engage intellectual property counsel for that purpose.
(iv) Representation of any investor. C&H does not and will not represent any investor, purchaser, or prospective purchaser in the Financing, including, without limitation, Granite Peak Ventures, LP, Ridgeline Capital Partners, LLC, Solstice Growth Fund I, LP, or any other person or entity acquiring shares of Series B Preferred Stock.
The investors participating in the Financing are separately represented by Fenwick, Pratt & Howell LLP (555 California Street, Suite 4000, San Francisco, CA 94104), with lead attorney Katherine "Kate" Linfield, Partner, serving as primary counsel for the investor group. C&H will coordinate with Ms. Linfield and her colleagues at Fenwick, Pratt & Howell on document negotiations, closing logistics, and other matters as customary in transactions of this nature.
If, during the course of this engagement, additional legal matters arise that are outside the scope described above, C&H will notify the Company and discuss whether such matters should be undertaken as part of this engagement (subject to an adjustment of the fee cap, if appropriate) or addressed separately.
3. Engagement Team
The following attorneys have been assigned to this matter and will serve as the principal members of the engagement team:
Miriam Calloway, Partner — Responsible Partner. Ms. Calloway will serve as the primary client contact and will have overall supervisory responsibility for the engagement, including the review and approval of all material work product and communications with investors' counsel. Ms. Calloway's primary practice area is Healthcare & Life Sciences; however, she has extensive experience representing emerging-growth companies in venture capital financings and related corporate transactions and is well suited to lead this engagement on behalf of the Company.
Joel Strauss, Partner — Billing Partner. Mr. Strauss will be responsible for all billing, budgeting, and fee-related matters in connection with this engagement. Mr. Strauss is also a member of the Firm's Healthcare & Life Sciences practice group and will provide substantive support to the engagement team as needed. Any billing inquiries should be directed to Mr. Strauss.
Robert Jansen, Associate — Lead Associate. Mr. Jansen will handle the day-to-day drafting of transaction documents, coordinate with investors' counsel on document comments and markup, and serve as the primary point of contact for routine transactional matters. Mr. Jansen's practice background is in Tax, which provides him with a useful perspective on the capitalization analysis and related matters, though, as noted above, the Firm is not providing tax advice in this engagement.
Amy Chesterton, Associate — Working Associate. Ms. Chesterton will assist with closing logistics, management of the closing checklist, preparation of ancillary closing documents, and such other tasks as may be assigned by the Responsible Partner. Ms. Chesterton's prior practice experience is in Bankruptcy & Restructuring, and she brings strong organizational skills and document-management discipline to the engagement team.
From time to time, additional attorneys, paralegals, or other professional staff may be assigned to the engagement as the needs of the matter require. C&H will provide notice to the Company of any material changes to the composition of the engagement team. The billing rates for any additional personnel assigned to the engagement will be consistent with the rate ranges set forth in Section 4.2 below.
4. Fees and Billing
4.1 Fee Cap
The total legal fees for C&H's services rendered in connection with the Financing engagement shall be capped at One Hundred Seventy-Five Thousand Dollars ($175,000) (the "Fee Cap"). The Fee Cap covers all attorney and professional staff time incurred from the date of this Engagement Letter through the closing of the Financing and through the completion of post-closing administrative matters directly related to the Financing, including the assembly and distribution of closing binders, post-closing filings, and the delivery of the final capitalization analysis and liquidation waterfall memorandum.
C&H will not bill the Company for legal fees in excess of the Fee Cap without the prior written consent of the Company. In the event that the scope of the engagement is materially expanded beyond the tasks described in Section 2 above (for example, if the Financing requires a restructuring of the existing preferred stock terms beyond what is contemplated by the Term Sheet, or if unanticipated regulatory issues arise), C&H and the Company will discuss in good faith whether an adjustment to the Fee Cap is appropriate, and any such adjustment will be documented in a written amendment to this Engagement Letter signed by both parties.
For the avoidance of doubt, the Fee Cap covers legal fees only. Disbursements and out-of-pocket expenses are addressed separately in Section 4.3 below and are not subject to the Fee Cap.
4.2 Billing Rates
For purposes of transparency and to provide the Company with visibility into the composition of our fees, and also for application in the event the Fee Cap is waived or the scope of the engagement is expanded, the current standard hourly billing rates for the members of the engagement team are as follows:
C&H's standard practice is to adjust billing rates annually, typically effective January 1 of each calendar year. Notwithstanding the foregoing, the billing rates set forth above will remain fixed for the duration of this engagement and will not be adjusted during the term of this Engagement Letter.
4.3 Disbursements and Expenses
The Fee Cap set forth in Section 4.1 is exclusive of out-of-pocket disbursements and expenses, which will be billed to the Company at cost without markup. Examples of disbursements and expenses that may be incurred in connection with this engagement include, without limitation:
•  filing fees, including the filing fee payable to the Secretary of State of the State of Delaware in connection with the filing of the Amended and Restated Certificate of Incorporation (and any related expedited processing fees);
•  courier and overnight delivery charges;
•  travel expenses, if any (subject to the Company's prior approval for any travel expenses exceeding $500 in the aggregate);
•  charges for online legal research databases (e.g., Westmark Data Systems, Calderon Systems);
•  photocopying and printing charges in excess of ordinary amounts incurred in the preparation of closing binders and signature pages; and
•  any fees charged by Pinnacle National Bank, N.A. or Ledgermark Transfer Services, Inc. that are passed through to C&H for payment (though such fees are typically billed directly to the Company by the applicable service provider).
Based on our experience with transactions of similar size and complexity, we estimate that total disbursements and expenses for this engagement will be in the range of approximately $2,000 to $5,000. We will endeavor to keep these costs to a minimum and will promptly notify the Company if it appears that disbursements may exceed the upper end of this estimate.
4.4 Billing and Payment Terms
C&H will render monthly invoices to the Company for fees incurred and disbursements advanced during the preceding billing period. Each invoice will contain a reasonably detailed summary of time entries (including the date, attorney or staff member, hours worked, and a description of the services performed) and an itemization of disbursements and expenses. Invoices will be sent to the attention of Mr. David Okonkwo, Chief Financial Officer, at the Company's address set forth above, or to such other address or email address as the Company may designate in writing from time to time.
Invoices are due and payable within thirty (30) days of the date of the invoice. If the Company has a question or dispute regarding any item on an invoice, the Company should contact Billing Partner Joel Strauss promptly so that the matter can be addressed. Payment of undisputed amounts should not be withheld pending resolution of any disputed items.
The Company acknowledges that, pursuant to the terms of the Stock Purchase Agreement, the Company has agreed to reimburse investors' counsel, Fenwick, Pratt & Howell LLP, for legal fees incurred in connection with the Financing, capped at Seventy-Five Thousand Dollars ($75,000), plus reasonable out-of-pocket disbursements, payable at the closing of the Financing. This reimbursement obligation is the Company's obligation under the Stock Purchase Agreement and is entirely separate from, and in addition to, the fees and disbursements payable to C&H under this Engagement Letter.
5. Client Identity and Conflicts
C&H's client in this engagement is Skybridge Fintech Ltd. — the corporate entity. C&H does not represent, and this engagement shall not be construed to create an attorney-client relationship with, any individual officer, director, employee, stockholder, or affiliate of the Company in their personal capacity. Without limiting the generality of the foregoing, C&H does not represent Mr. Naveen Raghavan, Mr. David Okonkwo, or any other officer or director of the Company in their individual capacities, and no communication from C&H to any individual should be understood as constituting personal legal advice to that individual. Individual officers, directors, and stockholders should consider retaining their own separate counsel to advise them regarding their personal interests in connection with the Financing, to the extent they deem it necessary or appropriate.
C&H does not represent, and will not represent, any investor, purchaser, or prospective purchaser of shares of Series B Preferred Stock in connection with the Financing, including, without limitation, Granite Peak Ventures, LP, Ridgeline Capital Partners, LLC, Solstice Growth Fund I, LP, or any of their respective affiliates, general partners, limited partners, members, managers, or advisors. The investors are separately represented by their own counsel as described in Section 2 above.
C&H has conducted a thorough conflicts check in accordance with the Firm's standard procedures and the applicable Delaware Rules of Professional Conduct, and we confirm that, as of the date of this Engagement Letter, C&H is not aware of any current conflict of interest that would preclude or impair the Firm's ability to represent the Company in this engagement. In the event that a conflict of interest arises during the course of the engagement, C&H will promptly notify the Company and will address the conflict in accordance with the applicable rules of professional responsibility, which may include, depending on the nature and severity of the conflict, seeking the Company's informed written consent to continued representation, implementing an ethical screen or other protective measures within the Firm, or, if the conflict is not waivable, withdrawing from the engagement.
6. Confidentiality and Privilege
All communications between C&H and the Company, and all documents and materials prepared by C&H in connection with this engagement, are intended to be protected by the attorney-client privilege, the work-product doctrine, and any other applicable privileges or protections. C&H will take reasonable measures to preserve the confidentiality and privileged nature of such communications and materials.
C&H will maintain the confidentiality of all non-public information received from the Company in connection with this engagement and will not disclose such information to any third party without the Company's prior written consent, except as may be required by applicable law, regulation, or court order, or as may be necessary in connection with the performance of our duties under this Engagement Letter (including, for example, the inclusion of factual information in transaction documents that will be shared with the investors and their counsel in the ordinary course of negotiations).
The Company acknowledges and understands that information shared with the investors and their counsel, Fenwick, Pratt & Howell LLP, in the course of due diligence, document negotiations, and other customary interactions during the Financing process may not be subject to the attorney-client privilege or work-product protection. The voluntary disclosure of confidential or privileged information to third parties, including the investors and their counsel, may, in certain circumstances, constitute a waiver of the privilege with respect to the disclosed information. C&H will exercise professional judgment in determining what information is appropriately shared in the context of the Financing and will consult with the Company before disclosing any information that, in C&H's judgment, may be particularly sensitive.
7. Document Retention
C&H will retain the engagement files relating to this matter, including correspondence, drafts, memoranda, and work product, for a period of seven (7) years following the conclusion of the engagement (whether by completion of the Financing, termination, or otherwise). At the expiration of such seven-year retention period, C&H may destroy or dispose of the engagement files in the ordinary course of the Firm's records-management practices, without further notice to the Company.
The Company may request the return of original documents (including original signed agreements, certificates, and other instruments) at any time during or after the engagement, and C&H will promptly comply with any such request. C&H may retain copies of such original documents for its files. The Company acknowledges that C&H is not a custodian of the Company's corporate records and that the Company is responsible for maintaining its own complete corporate records.
8. Termination
Either party may terminate this engagement at any time, with or without cause, upon written notice to the other party. Termination by the Company shall be effective upon receipt of written notice by C&H. Termination by C&H shall be subject to the Firm's obligations under applicable rules of professional conduct, including the obligation to provide reasonable notice to the Company and to take steps to protect the Company's interests to the extent reasonably practicable.
Upon termination of the engagement, the Company will remain responsible for all fees and disbursements incurred through the effective date of termination. C&H will render a final invoice within thirty (30) days following the effective date of termination. C&H will cooperate in good faith in the orderly transition of the matter to successor counsel designated by the Company, including making available the engagement files and providing reasonable assistance to successor counsel to ensure continuity of the Company's interests.
Nothing in this Section 8 shall be construed to relieve either party of its obligations under Sections 6 (Confidentiality and Privilege) and 7 (Document Retention), which shall survive the termination of the engagement.
9. Governing Law
This Engagement Letter shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any principles of conflict of laws that would require the application of the laws of any other jurisdiction. Any dispute arising out of or relating to this Engagement Letter shall be subject to the exclusive jurisdiction of the state and federal courts located in Wilmington, Delaware, and each party hereby consents to the personal jurisdiction of such courts.
10. No Guarantee of Outcome
C&H will use its best professional efforts to provide competent and diligent legal representation to the Company in connection with the Financing. However, the Company understands and acknowledges that C&H cannot and does not guarantee any particular outcome of the Financing, including, without limitation, the successful closing of the Financing, the receipt of the anticipated gross proceeds, or the final terms of the definitive transaction documents. The outcome of any legal matter depends on range factors, many of which are outside the control of legal counsel, and the Company acknowledges that no representation or assurance has been made by C&H regarding the outcome of this engagement.
11. Acceptance and Counterparts
We respectfully request that the Company indicate its acceptance of the terms and conditions set forth in this Engagement Letter by having authorized representatives of the Company countersign this letter in the space provided below and return an executed copy to the Firm at the address indicated above, or by electronic delivery to Miriam Calloway at mcalloway@calderwoodharkness.com. Upon receipt of the countersigned letter, C&H will commence work on the engagement.
This Engagement Letter may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Counterparts may be delivered by facsimile, electronic mail (including PDF), or other electronic transmission, and any counterpart so delivered shall be deemed to have been duly and validly delivered and shall be valid and effective for all purposes.
If you have any questions regarding the terms of this Engagement Letter, please do not hesitate to contact Miriam Calloway at (302) 555-4200 or mcalloway@calderwoodharkness.com. We look forward to working with you and the Skybridge team on this exciting milestone for the Company.
[Signature Page Follows]
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Name: Miriam Calloway
Title: Partner — Responsible Partner
By: ________
Name: Joel Strauss
Title: Partner — Billing Partner
919 N. Market Street, Suite 1500 Wilmington, DE 19801
ACKNOWLEDGMENT AND ACCEPTANCE
By executing below, the undersigned, on behalf of Skybridge Fintech Ltd., acknowledge receipt of this Engagement Letter, confirm that they have read and understood its terms and conditions, and agree to be bound by the terms set forth herein.
ACKNOWLEDGED AND AGREED:
SKYBRIDGE FINTECH LTD.
By: ________
Name: Naveen Raghavan
Title: Co-Founder & Chief Executive Officer
Date: ________
By: ________
Name: David Okonkwo
Title: Chief Financial Officer
Date: ________
Address:
1600 Market Street, Suite 2200 Wilmington, DE 19801
Enclosures: None. The Firm's standard terms of engagement, to the extent supplemental to the terms set forth herein, are incorporated herein by reference. A copy of such standard terms is available upon request.
PRIVILEGED & CONFIDENTIAL — ATTORNEY-CLIENT COMMUNICATION
For the avoidance of doubt, the Client, Skybridge Fintech Ltd., is a portfolio company of Pinnacle Venture Fund II LP, and certain consents and reporting obligations to the sponsor may apply in connection with this matter.
Attorney / Staff | Role | Hourly Rate
Miriam Calloway, Partner | Responsible Partner | $895
Joel Strauss, Partner | Billing Partner | $875
Robert Jansen, Associate | Lead Associate | $525
Amy Chesterton, Associate | Working Associate | $450
Paralegal / Support Staff | Various | $250 – $325

CALDERWOOD & HARKNESS LLP Attorneys at Law 919 N. Market Street, Suite 1500 Wilmington, DE 19801

CALDERWOOD & HARKNESS LLP

ACKNOWLEDGMENT AND ACCEPTANCE

ACKNOWLEDGED AND AGREED:

SKYBRIDGE FINTECH LTD.

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