PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
CALDERWOOD & HARKNESS LLP 555 Mission Street, Suite 3100 San Francisco, California 94105 Telephone: (415) 882-7400 Facsimile: (415) 882-7401
Comments on Company's Draft Disclosure Schedules to Series A Preferred Stock Purchase Agreement
Quillen Technologies, Inc. (a Delaware corporation)
May 20, 2026
Matter Number: 1002-00002 Billing Code: 78412.001
Prepared by:
Rachel Bernstein, Partner (Responsible Partner) Leila Nazari, Associate (Lead Associate) Robert Jansen, Associate (Working Associate)
Delivered to:
Gregory Navarro, Esq. Sophie Marchetti, Esq. Fenwick, Torres & Keane LLP 200 Clarendon Street, Suite 3400 Boston, Massachusetts 02116
cc:
Christine Aldridge, Pinnacle Venture Fund II LP Tomas Medina, Pinnacle Venture Fund II LP Miriam Calloway, Calderwood & Harkness LLP
Re: Calderwood & Harkness LLP's comments on draft Disclosure Schedules to the Series A Preferred Stock Purchase Agreement dated May 16, 2026 (the "SPA"), among Quillen Technologies, Inc., a Delaware corporation (the "Company"), Pinnacle Venture Fund II LP ("Pinnacle"), Blackthorn Growth Fund III LP ("Blackthorn"), Stonebridge Ventures LLC ("Stonebridge"), and the other investors named therein (collectively, the "Investors")
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I. Introduction and General Comments
A. Purpose of This Memorandum
Calderwood & Harkness LLP serves as legal counsel to Pinnacle Venture Fund II LP, the lead investor in the proposed $22,500,000 Series A Preferred Stock financing of Quillen Technologies, Inc. (the "Company"). In connection with that engagement, we have undertaken a thorough review of the draft Disclosure Schedules (the "Schedules") delivered by Fenwick, Torres & Keane LLP on behalf of the Company on May 18, 2026.
This memorandum sets forth our comments on the Schedules as currently drafted. These comments are intended to identify insufficiencies, ambiguities, and omissions in the Schedules; to request supplementation and clarification of specific disclosures; and to flag areas where additional disclosure is required before the Schedules can be accepted as satisfactory for purposes of closing the Series A financing. Our review has been conducted with reference to the representations and warranties set forth in Article II of the SPA and the corresponding disclosure obligations that flow from those representations.
All references to "Section" numbers in this memorandum correspond to the applicable sections of the SPA dated May 16, 2026. Capitalized terms not otherwise defined herein have the meanings ascribed to them in the SPA.
The parties have established a target closing date of June 15, 2026. Given the nature and volume of the outstanding items identified herein, we believe it is essential that revised and supplemented Schedules be delivered promptly so that remaining issues can be resolved in advance of that target date.
B. General Observations
Before turning to our schedule-by-schedule comments, we wish to raise several general observations concerning the Schedules as a whole:
1. Incomplete and Placeholder Disclosures. Several of the Schedules appear incomplete or contain placeholder language — including bracketed references to documents "to be provided" and entries marked "TBD." All such placeholders must be replaced with final, substantive disclosures prior to closing. The Schedules, as delivered, do not satisfy the Company's obligations under Section 4.1(a) of the SPA, which requires delivery of Schedules that are "true, complete, and correct in all material respects."
2. Cross-References and Internal Consistency. We have observed a number of inconsistencies in cross-references between Schedules. For example, the intellectual property disclosures in Schedule 2.6 reference certain material contracts that do not appear in Schedule 2.9 (Material Contracts), and the employee disclosures in Schedule 2.10 reference option grants that are not fully reconciled with the option holder detail expected in Schedule 2.2. We request that company counsel undertake a comprehensive review of all cross-references between Schedules to ensure internal consistency throughout.
3. Bring-Down and Update Obligations. The Schedules should be prepared to be accurate as of the date of delivery and must be updated through and as of the closing date. Pursuant to Section 5.4 of the SPA, the Company has an ongoing obligation to supplement the Schedules to reflect any material changes arising between the date of initial delivery and the closing date. We expect that a bring-down certificate will be delivered at closing confirming the continued accuracy of the Schedules as updated.
4. Scope of Cross-Qualification. The draft Schedules do not clearly indicate whether disclosures made in one Schedule are intended to qualify only the specifically referenced representation and warranty or are also intended to cross-qualify other representations and warranties to which such disclosures may be relevant. Section 2.1 of the SPA provides that disclosures in a particular Schedule qualify the corresponding representation, and any other representation "to the extent the relevance of such disclosure to such other representation is reasonably apparent on the face of such disclosure." We request that company counsel confirm its understanding of this cross-qualification standard and, to the extent disclosures are intended to qualify representations other than the one specifically referenced, that such intent be made explicit through appropriate cross-references.
5. Consistent Identification of the Company. All Schedules should consistently reference the full legal name of the Company as "Quillen Technologies, Inc." and should include identifying information — specifically, Delaware C-corporation status, Delaware Division of Corporations File Number 7384219, and Employer Identification Number 93-4817265 — where appropriate for clarity and completeness.
6. Supporting Documentation. Where the Schedules reference agreements, filings, reports, or other documents, we request that copies of such documents be made available in the virtual data room or delivered directly to Calderwood & Harkness LLP for review. References alone are insufficient to permit a meaningful assessment of the adequacy of the disclosure.
We turn now to our schedule-by-schedule comments.
II. Schedule-by-Schedule Comments
Schedule 2.2 — Capitalization
Schedule 2.2 sets forth the Company's capitalization as of the date of the SPA. This is among the most critical Schedules for purposes of the Series A financing, as it establishes the baseline from which pre-money valuation, price per share, and economic dilution are calculated. Our review has identified a number of areas where the current disclosure is inadequate or requires supplementation.
A. Common Stock
The Schedule states that 8,000,000 shares of Common Stock are currently issued and outstanding. We request that the Company provide a holder-by-holder breakdown of all outstanding shares of Common Stock, including the following detail for each holder:
(i) Dr. Amara Osei (Co-Founder & CEO): The Schedule states that Dr. Osei holds 3,200,000 shares of Common Stock. We request confirmation as to whether any of these shares remain subject to existing vesting schedules, repurchase rights, or other transfer restrictions (whether arising under the Company's Certificate of Incorporation, any restricted stock purchase agreement, or otherwise). If any portion of Dr. Osei's shares is unvested or subject to repurchase, please identify the applicable vesting schedule, the number of shares that have vested as of the date hereof, and the repurchase price per share.
(ii) Julian Voss (Co-Founder & CTO): The Schedule states that Mr. Voss holds 2,800,000 shares of Common Stock. We make the same request with respect to Mr. Voss's shares as set forth above for Dr. Osei's shares — specifically, confirmation as to whether any shares are subject to existing vesting, repurchase rights, or restrictions, and if so, full detail regarding the applicable terms.
(iii) Priya Chandrasekar (VP of Product): The Schedule states that Ms. Chandrasekar holds 400,000 shares of Common Stock. We understand that Ms. Chandrasekar joined the Company in January 2025. We request confirmation of (a) the grant date for these shares, (b) the applicable vesting schedule (including cliff periods, acceleration provisions, and any single- or double-trigger acceleration), (c) whether the shares are subject to existing repurchase rights in favor of the Company, and (d) the number of shares that have vested as of the date hereof and as of the anticipated closing date.
(iv) Remaining Shares (1,600,000): The Schedule does not identify the holders of the remaining 1,600,000 shares of Common Stock. We request a complete list of all other holders, the number of shares held by each, the consideration paid or other basis for issuance, and any applicable restrictions, vesting schedules, or repurchase rights.
We further note that, pursuant to Section 5.8 of the SPA and the related provisions of the Voting Agreement, all founder shares will be subject to new four-year vesting with a one-year cliff, with vesting credit for time served prior to the closing date equal to twenty-five percent (25%) of the total vesting period. Based on the Company's incorporation date of approximately July 2023, the founders will have served approximately thirty-five (35) months as of the anticipated closing date. This would result in vesting credit of approximately 8.75 months. We request that the Company confirm this calculation and that Schedule 2.2 reflect the reimposition of vesting on founder shares in the pro forma capitalization disclosure.
B. Series Seed Preferred Stock
The Schedule states that 2,500,000 shares of Series Seed Preferred Stock are issued and outstanding at an original issue price of $1.20 per share, representing an aggregate investment of $3,000,000. We request that the Company confirm the identity and shareholdings of all holders of Series Seed Preferred Stock, which we understand to be as follows:
(i) Harborview Angel Syndicate LLC: 1,500,000 shares ($1,800,000 invested).
(ii) Ridgepoint Seed Partners LP: 1,000,000 shares ($1,200,000 invested).
We further request the following with respect to the Series Seed Preferred Stock:
(a) Copies of, or specific data room references to, the Series Seed stock purchase agreement and all ancillary documents, including any investors' rights agreement, voting agreement, right of first refusal and co-sale agreement, or other agreements entered into in connection with the Series Seed financing.
(b) Confirmation as to whether any holders of Series Seed Preferred Stock have preemptive rights, anti-dilution rights (weighted-average or full-ratchet), rights of first refusal, information rights, or other contractual rights that are triggered by the consummation of the Series A financing. If any such rights exist, the Schedule should disclose the nature of each right, the holder(s) entitled to exercise such right, and whether the requisite waivers or consents have been obtained or are expected to be obtained prior to closing.
(c) Confirmation of the conversion ratio and liquidation preference applicable to the Series Seed Preferred Stock and any changes thereto that will result from the filing of the Amended and Restated Certificate of Incorporation in connection with the Series A financing.
C. Option Pool / 2023 Equity Incentive Plan
The Schedule references the Company's 2023 Equity Incentive Plan (the "Plan") and states that 2,000,000 shares of Common Stock are authorized for issuance under the Plan, of which 1,200,000 have been granted and 800,000 remain available for future issuance. We have the following comments and requests:
(i) Option Holder Schedule. We request a complete schedule listing each holder of outstanding options under the Plan, including for each optionee: (a) the optionee's name and title or position, (b) the number of shares subject to the option, (c) the per-share exercise price, (d) the grant date, (e) the applicable vesting schedule (including any cliff, acceleration provisions, or early exercise rights), (f) the number of shares vested as of the date hereof and as of the anticipated closing date, and (g) the expiration date of the option.
(ii) Exercise Status. We request confirmation as to whether any options granted under the Plan have been exercised. If so, the Schedule should identify the optionee, the number of shares acquired upon exercise, the exercise date, and whether any shares acquired upon exercise remain subject to repurchase rights. If no options have been exercised (i.e., all 1,200,000 options are outstanding but unexercised), please confirm that fact affirmatively.
(iii) Option Pool Expansion. The Schedule should reflect the proposed expansion of the Plan from 2,000,000 authorized shares to 3,000,000 authorized shares (an addition of 1,000,000 shares) to be effected prior to or simultaneously with the closing of the Series A financing. Following the expansion and assuming no additional grants between now and closing, the Plan would have 1,800,000 shares available for future issuance. We request confirmation that the dilution resulting from the option pool expansion is borne entirely by pre-Series A stockholders (i.e., the holders of Common Stock and Series Seed Preferred Stock) and is reflected in the pre-money valuation of $62,500,000 (as negotiated).
(iv) Plan Terms. We request a copy of the Plan, including any amendments, and the form of option agreement and any other form award agreements used thereunder. We also request confirmation that the Plan has been approved by the Company's Board of Directors and stockholders.
D. Convertible Notes
The Schedule references an aggregate of $1,500,000 in principal amount of convertible promissory notes (the "Notes") issued on or about March 15, 2024. We request that the Schedule be supplemented with the following detail regarding the Notes:
(i) Note Holders and Principal Amounts. We request confirmation of the identity and principal amount attributable to each Note holder, which we understand to be as follows:
• Harborview Angel Syndicate LLC: $750,000 in principal amount
• Caldwell Family Office LLC: $500,000 in principal amount
• Dr. Lawrence Hu: $250,000 in principal amount
(ii) Note Terms. We request that the Schedule confirm the material terms of the Notes, including: (a) interest rate of six percent (6%) per annum, simple interest; (b) conversion discount of twenty percent (20%); (c) valuation cap of $25,000,000; (d) original maturity date of March 15, 2026; and (e) extended maturity date of June 30, 2026 (as amended by the maturity extension agreement described below).
(iii) Extension Agreement. We understand that the maturity of the Notes was extended from March 15, 2026 to June 30, 2026 by mutual agreement of the Company and the Note holders. The Schedule should disclose the existence of this extension agreement, confirm that all Note holders consented to the extension, and identify any additional consideration or modified terms provided in connection therewith. We request copies of the extension agreement and all related documentation.
(iv) Conversion Mechanics. The Schedule should include a detailed description of the conversion mechanics applicable upon the closing of the Series A financing. Based on our review, we understand the conversion to operate as follows:
• The conversion price is derived from the valuation cap, calculated as $25,000,000 divided by 12,500,000 fully-diluted pre-money shares, yielding a cap-derived conversion price of $2.00 per share. This is more favorable to the Note holders than the discount-derived conversion price of $4.00 per share (calculated as the Series A price of $5.00 per share multiplied by (1 – 20%), or $5.00 × 0.80 = $4.00). Accordingly, the applicable conversion price is $2.00 per share.
• Accrued interest through the anticipated closing date of June 15, 2026 (approximately twenty-seven (27) months at 6% per annum, simple interest) is estimated at $202,500 ($1,500,000 × 6% × 27/12).
• The total conversion amount is therefore estimated at $1,702,500 ($1,500,000 principal + $202,500 accrued interest).
• At a conversion price of $2.00 per share, the Notes will convert into approximately 851,250 shares of Series A Preferred Stock.
We request that the Company confirm each element of the foregoing calculation and disclose any differences in its own computation.
(v) No Other Convertible Securities. We request affirmative confirmation that there are no other outstanding convertible securities, simple agreements for future equity (SAFEs), warrants, options (other than those issued under the Plan), or other rights to acquire equity securities of the Company that are not disclosed in Schedule 2.2. If any such instruments exist, they must be fully disclosed.
E. Authorized Share Capital
We request that the Schedule confirm the Company's current authorized share capital, which we understand to consist of 15,000,000 shares of Common Stock and the authorized shares of Series Seed Preferred Stock. The Schedule should also note that the filing of the Amended and Restated Certificate of Incorporation in connection with the closing of the Series A financing will: (a) authorize the Series A Preferred Stock; (b) increase the total number of authorized shares of Common Stock and Preferred Stock as necessary to accommodate the post-closing capital structure; and (c) amend and restate the rights, preferences, and privileges of the Series Seed Preferred Stock as contemplated by the SPA. The Schedule should be updated to reflect the post-closing authorized capital.
F. Fully Diluted Cap Table
We request that a fully diluted pro forma capitalization table be attached as an exhibit to Schedule 2.2. This table should reconcile to the post-Series A capital structure and should include, at a minimum, the following line items:
We request that the Company confirm the foregoing figures or provide corrected calculations as applicable. To the extent there is any discrepancy between the pro forma cap table and the pre-money valuation and price-per-share calculations reflected in the SPA, please identify and explain such discrepancy.
Schedule 2.3 — Subsidiaries
The Schedule states that the Company has no subsidiaries. While this is consistent with our understanding, we request that the Company provide an affirmative confirmation that, as of the date hereof, the Company:
(a) has no direct or indirect subsidiaries;
(b) does not hold any equity interests, membership interests, partnership interests, or similar ownership interests in any other corporation, limited liability company, partnership, joint venture, or other entity;
(c) is not a party to any joint venture, strategic alliance, or similar arrangement involving shared ownership or governance of any entity or business;
(d) has not formed or organized any entity under the laws of any foreign jurisdiction; and
(e) does not maintain any branches, representative offices, or other establishments outside of the United States.
Schedule 2.4 — Authorization; No Conflicts
Schedule 2.4 should disclose all consents, approvals, notices, filings, and other actions required in connection with the authorization, execution, delivery, and performance of the SPA and the consummation of the Series A financing. At a minimum, we request that the Schedule address the following:
(a) Board and Stockholder Approvals. The Schedule should cross-reference the written consent of the Board of Directors and the written consent of stockholders (or confirm that such consents will be obtained prior to closing), authorizing (i) the execution and delivery of the SPA and the ancillary transaction documents, (ii) the issuance and sale of the Series A Preferred Stock, (iii) the filing of the Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware, (iv) the expansion of the 2023 Equity Incentive Plan, and (v) such other matters as are required under the SPA.
(b) Third-Party Consents Under Material Contracts. To the extent any material contract to which the Company is a party contains change-of-control, anti-assignment, or consent-required provisions that could be triggered by the Series A financing (including by virtue of the issuance of new equity, changes in board composition, or the grant of investor consent rights under the SPA), such provisions and the related consent obligations should be disclosed. We request that this disclosure be cross-referenced to Schedule 2.9 (Material Contracts).
(c) Banking Consents. We request confirmation as to whether any consent or notice is required from Crescent National Bank or any other banking institution in connection with the Series A financing, including under any deposit account control agreement, loan agreement, or other banking arrangement.
(d) Delaware Filing. The Schedule should confirm the requirement to file the Amended and Restated Certificate of Incorporation with the Delaware Secretary of State as a condition to the effectiveness of the authorization of the Series A Preferred Stock.
(e) Customer Agreement Provisions. We request specific disclosure of any anti-assignment or change-of-control provisions in customer SaaS subscription agreements that could be triggered by the Series A financing. Given the critical importance of the Company's recurring revenue base and customer relationships, any risk of customer termination or renegotiation as a result of the financing must be identified and assessed.
Schedule 2.5 — Litigation
The Schedule currently states "None." While we understand this to be the Company's position, we request that the Company provide a more detailed affirmative confirmation that, as of the date hereof and to the Company's knowledge:
(a) there are no actions, suits, proceedings, arbitrations, mediations, investigations, or claims pending or threatened against the Company or any of its officers, directors, employees, or agents, whether at law, in equity, or before any governmental authority;
(b) the Company has not received any cease-and-desist letters, infringement notices, demands, or other pre-litigation communications alleging infringement, misappropriation, or other violation of any third party's intellectual property rights (including patents, copyrights, trademarks, or trade secrets);
(c) the Company has not received any subpoenas, civil investigative demands, or requests for information from any governmental authority in connection with any investigation, inquiry, or enforcement proceeding;
(d) there are no unsatisfied judgments, orders, decrees, injunctions, or stipulations applicable to the Company; and
(e) the Company is not aware of any facts or circumstances that would reasonably be expected to give rise to any of the foregoing.
Schedule 2.6 — Intellectual Property
The Company's intellectual property — and in particular its proprietary "Mosaic" AI-driven portfolio analytics and risk-attribution platform — is the core asset underlying the Series A investment thesis. Accordingly, Schedule 2.6 must be comprehensive and detailed. Our comments are organized by category.
A. Owned IP
The Schedule references the Mosaic platform but does not provide the level of detail required. We request a comprehensive inventory of all intellectual property owned by the Company, organized as follows:
(i) Software. A description of the Mosaic AI-driven portfolio analytics and risk-attribution platform, including: (a) a summary description of all material software modules and features; (b) a version history (including current production version and any versions in beta or development); (c) a description of the development status of any material features or modules that are planned but not yet released; and (d) identification of the programming languages, frameworks, and development environments used in the creation of the platform.
(ii) Patents. Two pending U.S. utility patent applications are referenced as having been filed in August 2024. We request the following for each application: (a) the U.S. Patent and Trademark Office application number; (b) the title of the invention; (c) the named inventors; (d) the filing date; (e) the current prosecution status, including whether any office actions have been received, whether responses have been filed, and whether any claims have been allowed or rejected; and (f) copies of the filed applications and any correspondence with the USPTO. We note that the Schedule currently states that application numbers are "to be provided by company counsel" — this information must be furnished as part of the revised Schedules.
(iii) Trademarks. The Schedule references a trademark application for "MOSAIC" filed with the United States Patent and Trademark Office in November 2024. We request: (a) the USPTO serial number (currently noted as "TBD per company"); (b) the current status of the application (e.g., awaiting examination, published for opposition, allowed, registered); (c) the International Class or Classes of goods and services covered by the application; and (d) copies of the application and any office actions or correspondence. Additionally, we request disclosure of any other trademarks, service marks, trade names, or logos used by the Company, whether registered or unregistered.
(iv) Domain Names. The Schedule references the domain "quillentech.io." We request confirmation that this domain is registered in the name of Quillen Technologies, Inc. and not in the name of any individual. We further request the name of the domain registrar, the current expiration date, and confirmation that auto-renewal is enabled. Additionally, please identify any other domain names owned or controlled by the Company.
(v) Trade Secrets and Proprietary Information. We request a description of any material trade secrets, proprietary algorithms, machine learning models, training datasets, or other confidential proprietary information owned by the Company. While we recognize that the Company may not wish to disclose the substance of its trade secrets in the Schedules, the Company should at least identify the categories of trade secret information that exist and describe the measures taken to protect their confidentiality.
B. IP Assignments
A critical element of our diligence is confirming that the Company has clear and unencumbered ownership of all intellectual property used in its business. Accordingly, we request the following:
(a) Confirmation that all founders — specifically, Dr. Amara Osei and Julian Voss — have executed invention assignment agreements assigning to the Company all right, title, and interest in and to any inventions, works of authorship, developments, discoveries, or improvements conceived, created, or reduced to practice during the course of their employment or engagement with the Company.
(b) Confirmation that all current employees, including but not limited to Priya Chandrasekar and all twenty-four (24) members of the engineering team, have executed Confidential Information and Invention Assignment Agreements ("CIIAAs") in the Company's standard form. We request copies of all executed CIIAAs or, at a minimum, confirmation from company counsel that all such agreements have been obtained and are on file.
(c) Identification of any intellectual property that was developed in whole or in part by consultants, independent contractors, or other non-employee contributors, together with confirmation that such intellectual property has been validly assigned to the Company pursuant to written agreements. Please provide copies of any relevant work-for-hire or IP assignment agreements.
(d) Identification of any prior inventions, works, or other intellectual property excluded from any CIIA or assignment agreement (as permitted under applicable law, such as California Labor Code § 2870), and confirmation that no such excluded IP is used in or relates to the Company's business.
C. Open-Source Software
The Schedule references the use of open-source software libraries in the Mosaic platform but does not provide a comprehensive inventory. Given the potential for open-source license obligations to affect the Company's ability to commercialize the Mosaic platform on a proprietary basis, this disclosure is critically important. We request the following:
(a) A complete inventory of all open-source software components incorporated in, linked to, distributed with, or otherwise used in connection with the Mosaic platform. For each component, the inventory should identify:
• The name of the library or component
• The version currently in use
• The applicable open-source license type (e.g., Apache 2.0, MIT, BSD, LGPL, GPL, MPL, or other)
• The manner of use (e.g., statically linked, dynamically linked, modified, distributed as part of a compiled binary, used in SaaS delivery only, or used solely for internal development/testing purposes)
(b) Confirmation that the Company has not incorporated, linked, or distributed any software components that are subject to copyleft or "strong copyleft" licenses, including the GNU General Public License (GPL) v2 or v3, the Affero General Public License (AGPL), or any similar license that requires disclosure or licensing of proprietary source code as a condition of use, modification, or distribution. If any such components have been used, the Schedule must describe the nature of such use, the specific copyleft license at issue, and the Company's analysis of whether any copyleft obligations have been triggered.
(c) Confirmation that the Company's use of all open-source software components complies with the terms and conditions of the applicable open-source licenses, including attribution requirements, notice obligations, and any restrictions on commercial use.
(d) A description of the Company's open-source software policies and procedures, including any approval processes for the introduction of new open-source components, license compliance tracking tools, and internal audit procedures.
D. Third-Party IP / Licenses-In
We request that the Schedule disclose all material third-party intellectual property licenses under which the Company is a licensee, including software licenses, data licenses, content licenses, and any other agreements pursuant to which the Company has obtained rights to use intellectual property owned by third parties in connection with the Mosaic platform or otherwise in its business. For each such license, we request identification of: (a) the licensor; (b) the licensed IP; (c) the scope of the license (exclusive or non-exclusive, field-of-use limitations, territory limitations); (d) the license term and renewal provisions; (e) the license fees or royalty obligations; and (f) any restrictions on transferability, sublicensing, or assignment — including any provisions that would be triggered by the Series A financing or a change in control of the Company.
E. IP Encumbrances
We request affirmative confirmation that:
(a) No liens, security interests, pledges, mortgages, or other encumbrances of any kind exist on any of the Company's intellectual property assets.
(b) The Company has not granted any exclusive licenses to any of its intellectual property to any third party.
(c) No third party has any right of first refusal, option, or other preferential right with respect to any of the Company's intellectual property.
Schedule 2.7 — Compliance with Laws; Permits
We request that Schedule 2.7 be supplemented with the following disclosures:
(a) Permits and Authorizations. A list of all material permits, licenses, registrations, and governmental authorizations currently held by the Company, together with confirmation that all such permits are in full force and effect and that no violations, revocations, or proceedings are pending or threatened.
(b) Investment Advisers Act Analysis. Given the nature of the Mosaic platform — which provides AI-driven portfolio analytics and risk-attribution services to institutional investors — we request that the Company address its status under the Investment Advisers Act of 1940 (the "Advisers Act"). Specifically, please confirm that the Company is not registered as an investment adviser under the Advisers Act or under any state investment adviser statute, and disclose the legal basis for such non-registration. We understand the Company's position to be that the Mosaic platform is a software tool that provides analytical information and does not constitute "investment advice" within the meaning of the Advisers Act. If the Company has obtained any legal opinions, memoranda, or analyses supporting this position, please identify such materials and make them available for review.
(c) Data Protection and Privacy. The Company's operations involve the processing of financial data, client data, and potentially personal information. We request disclosure of any regulatory filings, registrations, or certifications related to data protection and privacy, including any obligations under applicable state privacy laws (e.g., the California Consumer Privacy Act, as amended by the California Privacy Rights Act), the EU General Data Protection Regulation (to the extent applicable), and any sector-specific data protection requirements.
(d) SOC 2 Compliance. We request confirmation that the Company completed a SOC 2 Type I audit in January 2026, conducted by Pemberton & Associates CPAs LLP (engagement partner: Diane Stratton). We further request disclosure of the current status of the SOC 2 Type II audit, which we understand to be in process with an expected completion date in Q3 2026. Please confirm whether the SOC 2 Type I report identified any material exceptions or deficiencies and, if so, describe the nature of such findings and any remediation efforts undertaken.
(e) Securities Law Compliance. We request confirmation that all prior securities offerings by the Company — including the issuance of founder shares, the Series Seed Preferred Stock financing, the issuance of options under the 2023 Equity Incentive Plan, and the convertible note offering — were conducted in compliance with applicable federal and state securities laws, including but not limited to applicable exemptions under the Securities Act of 1933, as amended, and applicable state "blue sky" laws. Please identify the specific exemption relied upon for each offering (e.g., Section 4(a)(2), Regulation D Rule 506(b), Rule 701) and confirm that all required filings (e.g., Form D) were timely made.
Schedule 2.8 — Tax Matters
Schedule 2.8 contains only limited disclosure. Given the significance of tax matters to the Investors — and in particular the importance of QSBS eligibility — we request the following supplementation:
(a) Entity Status. Confirm the Company's status as a C-corporation organized under the laws of the State of Delaware and its Employer Identification Number (93-4817265). Confirm that the Company has not at any time elected to be treated as an S-corporation under Subchapter S of the Internal Revenue Code.
(b) Tax Return Filings. Confirm that all federal, state, and local tax returns required to be filed by the Company have been timely filed (or extensions obtained) and that all taxes shown as due on such returns have been paid or adequately reserved for on the Company's financial statements.
(c) Audits and Assessments. Disclose any open audit periods, pending or threatened tax audits, assessments, deficiency notices, or claims by any taxing authority. If no such audits or claims exist, provide an affirmative statement to that effect.
(d) Tax Liens. Confirm that there are no tax liens of any kind on any of the Company's assets.
(e) Consolidated Group Status. Confirm that the Company has not been a member of any affiliated, consolidated, combined, or unitary group for purposes of filing any federal, state, or local tax return and has not entered into any tax-sharing, tax-allocation, or tax-indemnity agreements with any other party.
(f) Net Operating Losses and Tax Credits. Disclose the amount, if any, of the Company's net operating loss carryforwards and any tax credit carryforwards (including research and development tax credits) as of the most recent fiscal year-end. Identify any limitations on the utilization of such carryforwards, including limitations arising under Section 382 of the Internal Revenue Code.
(g) Employment Tax Compliance. Confirm that the Company has complied with all employment tax withholding and reporting obligations with respect to all thirty-eight (38) current employees and any independent contractors, including timely issuance of Forms W-2 and 1099, as applicable, and timely remittance of all withheld taxes to the appropriate taxing authorities.
(h) Section 409A Compliance. Disclose any Section 409A valuation reports (i.e., independent appraisals of the fair market value of the Company's Common Stock) obtained in connection with option grants under the 2023 Equity Incentive Plan. Confirm the date and fair market value conclusion of each such report, the identity of the valuation firm, and the methodology employed. Confirm that all options granted under the Plan were granted with exercise prices at or above the fair market value of the Common Stock as determined in accordance with Section 409A and the regulations thereunder.
(i) QSBS Eligibility. The Investors have indicated that eligibility for qualified small business stock ("QSBS") treatment under Section 1202 of the Internal Revenue Code is a material consideration in connection with the Series A investment. We request the following confirmations in connection with QSBS eligibility:
(1) The Company's aggregate gross assets (as defined in Section 1202(d)(2) of the Internal Revenue Code) have not exceeded $50,000,000 at any time prior to and including the date of issuance of the Series A Preferred Stock, and will not exceed $50,000,000 immediately following the receipt of the Series A investment proceeds (calculated in accordance with Section 1202(d)(2)).
(2) The Company satisfies the "active business" requirement of Section 1202(e) and does not derive a substantial portion of its revenue from performing services in the fields of health, law, engineering, architecture, accounting, actuarial science, performing arts, consulting, athletics, financial services, brokerage services, or any trade or business where the principal asset is the reputation or skill of one or more of its employees. We note that the characterization of the Company's business — providing software-based analytics tools to the financial services industry — may warrant careful analysis, and we request the Company's assessment of this issue.
(3) The Company has not engaged in any disqualifying transactions, including (A) stock redemptions exceeding the de minimis thresholds set forth in Section 1202(c)(3), (B) significant purchases of its own stock, or (C) any other transactions that would cause the Series A Preferred Stock to fail to qualify as QSBS.
Schedule 2.9 — Material Contracts
Schedule 2.9 lists certain contracts but appears incomplete. We request that the Company provide a comprehensive disclosure of all material contracts as described below.
A. Customer Agreements
The Schedule lists certain SaaS subscription agreements but does not appear to include all agreements meeting the materiality thresholds described in the SPA. We request:
(a) A complete list of all customer agreements with an annualized contract value ("ACV") exceeding $100,000. We note that the Company has reported annualized recurring revenue of approximately $3,800,000 as of Q1 2026 and last-twelve-months revenue of approximately $3,200,000. We would expect the Schedule to include all agreements that represent a significant portion of that revenue base.
(b) For each material customer agreement, the following detail: (i) customer name; (ii) effective date; (iii) initial term and current remaining term; (iv) renewal provisions (auto-renewal or opt-in); (v) ACV and pricing structure (per-user, per-seat, platform fee, or otherwise); (vi) termination rights (including termination for convenience and cure periods); (vii) change-of-control provisions; and (viii) assignment restrictions.
(c) Identification of any customer agreements that contain provisions requiring consent from the customer for the Series A financing, for a change in control of the Company, or for any assignment of the agreement (whether by operation of law or otherwise). If any such provisions exist, please describe the steps being taken to obtain the required consents.
(d) Identification of any customer agreements containing most-favored-nation pricing provisions, exclusivity commitments, non-compete restrictions, or other provisions that could limit the Company's ability to conduct its business or serve other customers.
B. Vendor / Supplier Agreements
We request disclosure of all material vendor and supplier agreements, including:
(a) All cloud hosting and infrastructure agreements, including any agreements with Ridgeway Industries (Meridian Technologies), Crestline Systems, Aldermere Technologies, or equivalent providers. Please disclose the annual spend, committed usage or minimum purchase obligations, term, and renewal provisions for each such agreement.
(b) All data provider agreements, including agreements for market data feeds, portfolio data, benchmark data, or other financial data used in connection with the Mosaic platform. Please disclose the provider name, data types covered, annual cost, term, and any restrictions on use or redistribution.
(c) All other vendor agreements with annual spend exceeding $50,000.
(d) For each material vendor agreement, identification of any anti-assignment or change-of-control provisions.
C. Employment and Consulting Agreements
We request complete disclosure of all employment agreements, offer letters, independent contractor agreements, and consulting agreements with the following individuals, together with a description of the material terms thereof:
(a) Dr. Amara Osei, Co-Founder & CEO — employment agreement or offer letter, including base salary, bonus structure, equity grants, severance provisions, change-of-control benefits, non-competition and non-solicitation obligations, and confirmation of at-will or term employment status.
(b) Julian Voss, Co-Founder & CTO — same request as for Dr. Osei.
(c) Priya Chandrasekar, VP of Product — same request, noting that Ms. Chandrasekar joined the Company in January 2025. We are particularly interested in any severance or acceleration provisions and the terms of her equity grant.
(d) All other employees with total annual compensation exceeding $150,000 — please identify each such employee by name and title, and provide the material terms of his or her employment arrangement.
(e) All consulting or independent contractor agreements — please identify each consultant or independent contractor currently engaged by the Company, the services provided, the compensation terms, and any equity grants.
For all employment and consulting agreements disclosed under this heading, please cross-reference to Schedule 2.6 (Intellectual Property) with respect to CIIAAs and invention assignment provisions.
D. Banking and Credit Agreements
We request disclosure of all agreements with Crescent National Bank, including any operating account agreements, deposit account control agreements, and wire transfer facilities. We understand that the Company maintains its primary operating account and note wire conduit at the Boston branch of Crescent National Bank. Please confirm:
(a) Whether the Company has any outstanding indebtedness (other than the convertible notes disclosed in Schedule 2.2) to Crescent National Bank or any other lender, including any revolving lines of credit, term loans, equipment financing arrangements, or letters of credit.
(b) Whether any security interests have been granted to Crescent National Bank or any other party in any assets of the Company.
(c) Current outstanding debt levels. We note that the protective provisions in the SPA require Pinnacle's prior written consent for the incurrence of any indebtedness in excess of $500,000 in the aggregate. The Schedule should confirm the Company's current indebtedness levels (other than the convertible notes) to ensure compliance with this threshold.
E. Convertible Note Documents
We request that this portion of Schedule 2.9 cross-reference the convertible note disclosures in Schedule 2.2 and that the Company provide copies of the following documents:
(a) The convertible note purchase agreement(s) governing the issuance of the Notes.
(b) Each individual promissory note.
(c) The maturity extension agreement and any related amendments, waivers, or consents.
(d) Any side letters, supplemental agreements, oral understandings, or other arrangements with any individual Note holder that modify or supplement the terms of the Notes. If no such arrangements exist, please provide an affirmative confirmation to that effect.
F. Other Material Agreements
We request disclosure of all other material agreements not otherwise covered by the categories above, including:
(a) Office Lease. The Company's office lease at 88 Garrison Street, Floor 4, Boston, Massachusetts 02116. See also our comments on Schedule 2.16 below.
(b) Insurance Policies. All insurance policies maintained by the Company, including directors and officers liability, general commercial liability, cyber liability/errors and omissions, workers' compensation, and property/business interruption insurance. See also our comments on Schedule 2.12 below.
(c) Related-Party Agreements. Any agreements, arrangements, or transactions between the Company and any officer, director, stockholder, or affiliate. See also our comments on Schedule 2.15 below.
(d) Settlement Agreements. Any settlement agreements, consent orders, consent decrees, or similar agreements entered into by the Company.
(e) Restrictive Agreements. Any agreements that restrict the Company's ability to compete in any line of business, to operate in any geographic area, or to solicit any customers or employees.
(f) Government Contracts. Any contracts or subcontracts with any governmental entity.
Schedule 2.10 — Employee Matters
We request that Schedule 2.10 be supplemented to include the following:
(a) Headcount. Confirmation of total headcount as of the date of the Schedules. We understand the Company currently has thirty-eight (38) full-time equivalent employees, broken down as follows: twenty-four (24) in engineering, six (6) in sales and marketing, five (5) in general and administrative functions, and three (3) executive officers. Please confirm this breakdown and identify any open positions currently being recruited for.
(b) Collective Bargaining. Confirmation that none of the Company's employees are represented by a labor union or covered by a collective bargaining agreement, and that no organizing efforts or petitions are pending or, to the Company's knowledge, threatened.
(c) Employment Disputes. Disclosure of any pending or threatened employment disputes, wrongful termination claims, discrimination or harassment complaints, wage-and-hour claims, or other employment-related proceedings. If none exist, please provide an affirmative statement to that effect.
(d) WARN Act. Confirmation that the Company has not conducted any plant closings or mass layoffs that would trigger notification obligations under the federal Worker Adjustment and Retraining Notification Act or any applicable state "mini-WARN" law, and that no such actions are planned.
(e) Employee Benefit Plans. A list of all employee benefit plans, programs, and arrangements maintained, sponsored, or contributed to by the Company, including the 2023 Equity Incentive Plan (cross-referenced to Schedule 2.2), any 401(k) plan, health insurance plans, dental and vision plans, life and disability insurance, paid time off and leave policies, and any other material benefits.
(f) Independent Contractor Classification. Identification of all individuals currently classified as independent contractors and a description of the basis for such classification. The Company should confirm that all individuals classified as independent contractors satisfy the applicable legal tests for independent contractor status under federal and applicable state law (including any ABC test jurisdictions), and that the Company has not received any challenge to or inquiry regarding the classification of any individual.
(g) Immigration. Identification of any employees who are employed pursuant to H-1B visas, other work visas, or other immigration-related authorizations, together with the visa type, expiration date, and any transfer or portability limitations that may be relevant.
Schedule 2.11 — Environmental Matters
The Schedule states "Not applicable." While we anticipate that this is appropriate for a software company, we request an affirmative confirmation that:
(a) The Company has no environmental liabilities of any kind.