1002-00004 · Pinnacle Venture Fund II LP · Correspondence

letter-recommendation-to-hold.docx DOCUMENT Finance & Banking

6 / 35 ← → ✕

Contract analysis Extract to table

PRIVILEGED & CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION

CALDERWOOD & HARKNESS LLP Attorneys at Law

101 Montgomery Street, Suite 3500 San Francisco, California 94104

Telephone: (415) 782-9000 Facsimile: (415) 782-9001 www.calderwoodharkness.com

November 18, 2022

VIA EMAIL AND FIRST CLASS MAIL

Marcus Trejo Partner, Head of Growth Equity Pinnacle Capital Management LLC (as General Partner of Pinnacle Venture Fund II LP) 2400 Sand Hill Road, Suite 310 Menlo Park, California 94025

Re: Proposed $60,000,000 Series D Preferred Stock Investment in Verdana Software, Inc. — Recommendation to Place Matter on Hold

Matter No.: 1002-00004 Client No.: PIN-0042

Dear Marcus:

I. Purpose of Letter

I am writing in my capacity as Responsible Partner on the above-referenced matter to formally recommend that Pinnacle Venture Fund II LP ("Pinnacle" or the "Fund") place its proposed $60,000,000 Series D Preferred Stock investment in Verdana Software, Inc. ("Verdana" or the "Company") on hold and that the matter status be changed to dormant in our firm's records and billing systems. This recommendation is the product of careful deliberation following extensive discussion with members of the deal team at both Calderwood & Harkness LLP ("C&H" or the "Firm") and the Pinnacle investment team, and reflects our assessment that continued expenditure of legal resources is not advisable absent a material change in the negotiating dynamic between the parties.

This recommendation follows the final negotiation session held on November 2, 2022, at the offices of Hargrove Securities LLC in San Francisco, at which senior representatives of both Pinnacle and Verdana — together with their respective legal and financial advisors — were unable to reach agreement on key commercial terms, most notably the pre-money valuation, the structure of the liquidation preference, the form of anti-dilution protection, and the scope of drag-along rights. Despite productive discussions on certain subsidiary matters earlier in the process, the parties remain far apart on the core economic terms that would define the investment.

As additional context for this recommendation, I note that the exclusivity agreement governing the parties' negotiations expired on September 30, 2022, and discussions have continued on a non-exclusive basis since that date without material progress toward resolution of the outstanding commercial issues. The absence of exclusivity means that Verdana is presently free to solicit, entertain, and close on alternative financing proposals, which introduces additional risk that continued negotiations may prove futile if the Company secures capital from another source in the interim.

The purpose of this letter is to (a) provide a comprehensive summary of the transaction, the engagement history, and the current status of negotiations and documentation; (b) identify the specific unresolved commercial terms that have prevented the parties from reaching agreement; (c) highlight certain diligence findings that remain relevant to the investment thesis; (d) summarize the legal fees incurred to date; and (e) set forth our formal recommendation and the steps we propose to take in connection with placing the matter on hold. I trust this letter will serve as a useful reference for your records and for any future deliberations regarding the potential resumption of discussions with Verdana.

II. Summary of Transaction and Engagement History

Calderwood & Harkness LLP was engaged on April 19, 2022, pursuant to an engagement letter of even date executed by you on behalf of Pinnacle Capital Management LLC in its capacity as General Partner of Pinnacle Venture Fund II LP, to represent the Fund in connection with a proposed $60,000,000 minority growth equity investment in Verdana Software, Inc. Verdana is a Delaware C-corporation headquartered in Portland, Oregon, that develops and commercializes an AI-powered supply chain optimization software-as-a-service platform marketed under the trade name "Verdana SCX." The Company was founded in 2016 by Raj Anand (Chief Executive Officer) and Lena Kovac (Chief Technology Officer) and has raised approximately $85,000,000 in prior institutional venture capital financing across three rounds.

The transaction as originally contemplated involved the purchase by Pinnacle of newly issued shares of Series D Preferred Stock of Verdana representing approximately 18.75% of the Company's fully-diluted capitalization on a post-closing basis. The investment was intended to be a lead investment by Pinnacle, with no co-investors identified at the outset, although the term sheet reserved the right for Pinnacle to syndicate up to $15,000,000 of the commitment to one or more co-investors prior to closing, subject to Verdana's consent.

The key milestones in the engagement to date are as follows:

April 22, 2022. Pinnacle delivered a non-binding term sheet to Verdana proposing a $260,000,000 pre-money valuation, equivalent to a price per share of $3.25 based on 80,000,000 fully-diluted pre-investment shares outstanding. At this valuation, the $60,000,000 investment would result in the issuance of approximately 18,461,538 shares of Series D Preferred Stock, representing approximately 18.75% of the post-close fully-diluted capitalization.

May 3, 2022. Verdana, through its placement agent Hargrove Securities LLC ("Hargrove," led by Nathan Callister), delivered a counter-term sheet proposing a pre-money valuation of $320,000,000, equivalent to a price per share of $4.00. This represented a $60,000,000 gap between the parties' respective valuation positions — a gap that, as discussed in detail below, has persisted through the entirety of the negotiations.

May 12, 2022. The parties executed a mutual exclusivity agreement with a 60-day initial term expiring on July 11, 2022. The exclusivity agreement contained customary standstill and no-shop provisions prohibiting Verdana from soliciting, encouraging, or entering into discussions with any third party regarding an equity financing or similar transaction during the exclusivity period.

July 8, 2022. The exclusivity agreement was extended by mutual written amendment for a period of approximately five weeks, through August 15, 2022.

August 15, 2022. The exclusivity agreement was further extended by a second mutual written amendment through September 30, 2022. This was the final extension; the exclusivity period has not been renewed and expired by its terms on September 30, 2022.

May 16, 2022. Legal, financial, and commercial due diligence commenced. The C&H diligence team — led by Beatrice Holloway and staffed by Andrew Fitzpatrick and Naomi Petersen — reviewed corporate formation and governance documents, material contracts, intellectual property filings and licenses, employment agreements and equity incentive plan documentation, real property leases, insurance policies, litigation history, regulatory compliance matters, customer agreements, and financial statements and projections.

June 8–June 25, 2022. C&H prepared and delivered to Verdana's counsel, Langford Price & Associates LLP ("Langford Price," led by Jonathan Hale), initial drafts of the principal transaction documents, including: (i) the Series D Preferred Stock Purchase Agreement (the "SPA"), delivered June 8, 2022; (ii) the Amended and Restated Investors' Rights Agreement, delivered June 15, 2022; (iii) the Amended and Restated Right of First Refusal and Co-Sale Agreement (the "ROFR Agreement"), delivered June 20, 2022; (iv) the Amended and Restated Voting Agreement, delivered June 20, 2022; (v) the Amended and Restated Certificate of Incorporation of Verdana Software, Inc. (the "Restated Certificate"), delivered June 8, 2022; (vi) the Management Rights Letter, delivered June 22, 2022; (vii) a form of Indemnification Agreement for the Pinnacle board designee, delivered June 22, 2022; and (viii) a template for the Disclosure Schedules to the SPA, delivered June 8, 2022.

June 22, 2022. Langford Price returned its initial markup of the SPA, reflecting extensive revisions to the representations and warranties, indemnification provisions, closing conditions, and economic terms. The markup was accompanied by a 14-page issues memorandum identifying areas of disagreement and requesting additional information from Pinnacle regarding certain proposed terms.

July 15, 2022. C&H delivered to Pinnacle a comprehensive legal due diligence summary memorandum (the "Diligence Memo"), summarizing findings across all workstreams and identifying material risks, including the customer concentration risk discussed in Section IV below.

July 18, 2022. C&H delivered a revised second draft of the SPA to Langford Price, responding to the issues raised in Langford Price's June 22 markup and incorporating certain revisions directed by Pinnacle following review of the Diligence Memo.

July 22, 2022. Langford Price returned its markup of the Amended and Restated Investors' Rights Agreement. This markup reflected fundamental disagreements on anti-dilution protection, liquidation preference, pay-to-play provisions, redemption rights, and certain protective provisions, as discussed in Section III.B below.

September 6, 2022. Following several rounds of discussion among Pinnacle, Verdana, and the existing investors, partial agreement was reached on board composition. The parties agreed to a seven-member board of directors structured as follows: two (2) designees of the Founders (Raj Anand and Lena Kovac); one (1) designee of Ridgeline Ventures (the Series A lead investor); one (1) designee of Northgate Growth Partners (the Series B lead investor); one (1) designee of Brindoval Capital Group LLC (the Series C lead investor); one (1) designee of Pinnacle; and one (1) independent director to be mutually agreed by the Founders and the holders of a majority of the then-outstanding preferred stock. Board observer rights for Pinnacle were also agreed in principle, although the definitive terms were not finalized.

September 19, 2022. Pinnacle formally communicated its revised $260,000,000 pre-money valuation proposal to Verdana by letter, referencing the diligence findings (including customer concentration risk) as support for its valuation position.

October 14, 2022. Brindoval Capital Group LLC, the Series C lead investor represented by Diana Chen, proposed a compromise valuation of $290,000,000 pre-money ($3.625 per share), which would have resulted in the issuance of approximately 16,551,724 Series D shares and approximately 17.14% post-close ownership for Pinnacle. Pinnacle declined this proposal as insufficient to meet its target ownership percentage of 18.75%.

November 2, 2022. The final negotiation session was held in person at Hargrove Securities' offices. The session was attended by you (for Pinnacle), Raj Anand and Lena Kovac (for Verdana), Diana Chen (for Brindoval Capital Group), Nathan Callister (for Hargrove), Jonathan Hale (for Langford Price), and me and Beatrice Holloway (for C&H). Despite extended discussion, the parties were unable to bridge the valuation gap or resolve the other outstanding commercial terms described in Section III below.

No transaction documents have been executed to date, and no binding commitments of any kind have been made by either party with respect to the proposed investment.

III. Unresolved Commercial Terms

Despite extensive negotiations over a period of approximately seven months, a number of material commercial terms remain unresolved. These are summarized below in order of significance as assessed by the C&H deal team.

A. Valuation Gap

The central impasse between the parties remains the $60,000,000 gap between Pinnacle's proposed pre-money valuation of $260,000,000 and Verdana's proposed pre-money valuation of $320,000,000. This gap has persisted essentially unchanged from the initial exchange of term sheets in late April and early May 2022 through the final negotiation session on November 2, 2022.

The implications of this gap for the economic structure of the investment are significant:

Pinnacle's Proposal ($260,000,000 Pre-Money). At a pre-money valuation of $260,000,000, based on 80,000,000 fully-diluted pre-investment shares outstanding, the Series D price per share would be $3.25 (calculated as $260,000,000 ÷ 80,000,000 shares). Pinnacle's $60,000,000 investment at $3.25 per share would result in the issuance of approximately 18,461,538 shares of Series D Preferred Stock, and Pinnacle would hold approximately 18.75% of Verdana's fully-diluted post-closing capitalization (18,461,538 ÷ 98,461,538 total post-close fully-diluted shares).

Verdana's Proposal ($320,000,000 Pre-Money). At a pre-money valuation of $320,000,000, the price per share would be $4.00 (calculated as $320,000,000 ÷ 80,000,000 shares). At this price, Pinnacle's $60,000,000 investment would result in the issuance of only 15,000,000 Series D shares, and Pinnacle would hold approximately 15.79% of the post-closing fully-diluted capitalization (15,000,000 ÷ 95,000,000 total post-close fully-diluted shares). Moreover, if Verdana's proposed ESOP expansion of 5,000,000 shares (discussed below) is included in the pre-close fully-diluted share count — bringing the fully-diluted base to 100,000,000 shares — the effective price per share would remain $4.00 ($320,000,000 ÷ 80,000,000 shares, excluding the ESOP expansion from the pre-money calculation as proposed by Verdana), and Pinnacle's post-close ownership would be reduced to approximately 15.00% (15,000,000 ÷ 100,000,000).

Pinnacle formally communicated its revised $260,000,000 pre-money proposal by letter dated September 19, 2022, referencing the customer concentration risk identified during diligence (discussed in Section IV below) and broader SaaS market valuation compression as support for its position. Verdana rejected this proposal, maintaining its insistence on the $320,000,000 pre-money valuation.

On October 14, 2022, Brindoval Capital Group LLC, the Series C lead investor, through its principal Diana Chen, proposed a compromise at a $290,000,000 pre-money valuation. At $290,000,000, the price per share would be $3.625, the investment would result in the issuance of approximately 16,551,724 Series D shares, and Pinnacle would hold approximately 17.14% of the post-closing fully-diluted capitalization. While this proposal represented a genuine effort at compromise, Pinnacle declined the Brindoval proposal as insufficient to meet its target ownership percentage of 18.75%, which the Fund's investment committee had identified as a minimum threshold for the deployment of $60,000,000 of Fund capital.

In addition to the base valuation disagreement, the treatment of Verdana's employee stock option pool ("ESOP") remains unresolved and further complicates the valuation discussion. Verdana insists on expanding the ESOP by 5,000,000 shares — from the current 12,000,000 authorized and reserved shares to 17,000,000 shares — prior to closing, with the ESOP expansion shares included in the fully-diluted share count for purposes of calculating the post-close ownership percentages but excluded from the pre-money valuation calculation (i.e., Verdana's position is that the ESOP expansion would dilute all stockholders equally but would not reduce the pre-money valuation or the per-share price). Pinnacle's position, consistent with standard venture capital practice, is that any ESOP expansion should be included in the pre-money capitalization — that is, the additional 5,000,000 option shares should be treated as part of the fully-diluted share count used to calculate the pre-money price per share, thereby effectively requiring the existing stockholders (rather than the new investor) to bear the dilution associated with the expanded pool.

The valuation disagreement was compounded by the customer concentration risk identified during diligence, which is discussed in detail in Section IV below and which, in Pinnacle's view, supports a meaningfully lower valuation than the $320,000,000 proposed by Verdana. As an alternative to a direct reduction in the pre-money valuation, Pinnacle proposed at various points during the negotiations a customer retention escrow mechanism and, separately, an earnout mechanism tied to revenue diversification milestones, both of which would have addressed Pinnacle's customer concentration concerns while preserving Verdana's headline valuation. Neither proposal was accepted by Verdana.

B. Protective Provisions

Beyond the valuation gap, the parties remain materially apart on several protective provisions that would define the economic rights and protections of the Series D Preferred Stock.

Liquidation Preference. Pinnacle proposed a 1.5x non-participating liquidation preference on the Series D Preferred Stock. Under this proposal, in the event of a liquidation, dissolution, winding up, or deemed liquidation event (including a merger, acquisition, or asset sale), the holders of Series D Preferred Stock would be entitled to receive an amount equal to 1.5 times the original investment amount — $60,000,000 × 1.5 = $90,000,000 — in preference to, and prior to any distribution to, the holders of common stock. The Series D holders would not participate with the common stock in any distribution in excess of the 1.5x preference amount (i.e., the preference would be non-participating). Verdana and the existing investors have insisted on a 1.0x non-participating liquidation preference ($60,000,000), which is consistent with the terms of the Series A Preferred Stock held by Ridgeline Ventures (led by Priya Dasgupta), the Series B Preferred Stock held by Northgate Growth Partners (led by Elliott Margolis), and the Series C Preferred Stock held by Brindoval Capital Group LLC (led by Diana Chen). The existing investors have taken the position that granting a 1.5x preference to the Series D would create an inequitable seniority structure within the capital stack and could complicate future fundraising.

Anti-Dilution Protection. Pinnacle proposed full-ratchet anti-dilution protection for the Series D Preferred Stock. Under a full-ratchet mechanism, if Verdana issues equity securities at a per-share price below the Series D original issuance price, the Series D conversion price would be adjusted downward to equal the price at which such new shares were issued, regardless of the number of shares issued in the dilutive financing. Verdana offered broad-based weighted average anti-dilution protection, under which the conversion price would be adjusted using a formula that takes into account both the price and the number of shares issued in the dilutive financing, resulting in a less severe adjustment. Broad-based weighted average anti-dilution is the standard in all three prior preferred stock rounds (Series A, Series B, and Series C). Brindoval Capital Group LLC expressly objected to the granting of full-ratchet anti-dilution protection to the Series D, arguing that it would create an inconsistency in the capital structure that could deter future investors and would disproportionately disadvantage earlier-round preferred holders in any down-round scenario.

Consent Rights. Pinnacle proposed that the Series D holders (or, in certain cases, Pinnacle as the lead Series D holder) would have consent rights over (a) the incurrence by Verdana of any new indebtedness in excess of $5,000,000 in the aggregate, and (b) the adoption of or material deviation from annual operating budgets, with "material deviation" defined as any variance exceeding 15% of the board-approved operating plan. Verdana's counsel proposed narrowing the indebtedness consent threshold to $15,000,000 and eliminating the budget deviation consent right entirely, arguing that the latter would impede management's ability to respond to market conditions and would be unduly burdensome for a growth-stage company. These proposals remain unresolved.

Pay-to-Play. Pinnacle proposed a mandatory pay-to-play provision applicable to all holders of preferred stock in any future qualified financing round. Under this provision, any holder of preferred stock that fails to purchase its pro rata share of new securities offered in a future financing round would have its preferred stock automatically converted into common stock, thereby extinguishing the holder's liquidation preference, anti-dilution protection, and other preferred stock rights. Pinnacle viewed this provision as essential to align incentives and to ensure that all preferred holders participate proportionally in supporting the Company through future capital needs. Langford Price, on behalf of Verdana, deleted the pay-to-play provision in its entirety in its markup of the Investors' Rights Agreement, and the existing investors did not support its inclusion.

Redemption Rights. Pinnacle proposed that the Series D Preferred Stock carry mandatory redemption rights exercisable at the election of the holders of a majority of the then-outstanding Series D shares at any time after the fifth anniversary of the closing date. Upon exercise, Verdana would be required to redeem the outstanding Series D shares at a price per share equal to the original issuance price plus all accrued and unpaid dividends. Verdana's counsel has neither accepted nor rejected this proposal, and the issue remains open.

Dividends. On a positive note, the parties have reached agreement on the dividend provisions. The Series D Preferred Stock will accrue cumulative, non-compounding dividends at a rate of 8% per annum of the original issuance price, payable when and if declared by the board of directors. Based on a $60,000,000 aggregate original issuance price, this results in an annual dividend accrual of $4,800,000. This is one of the few economic terms on which the parties have achieved consensus.

C. Drag-Along Rights

The structure and trigger thresholds for drag-along rights have been a significant source of contention throughout the negotiations. Pinnacle proposed a drag-along provision under which holders of a majority of the then-outstanding shares of preferred stock (voting together as a single class on an as-converted basis) could require all stockholders — including holders of common stock — to consent to and participate in a sale of the Company (whether by merger, stock sale, or asset sale) or an initial public offering, on the terms approved by the requisite majority of preferred holders.

Verdana's co-founders, Raj Anand (CEO) and Lena Kovac (CTO), who collectively hold 28,000,000 shares of common stock representing 35.0% of the pre-investment fully-diluted capitalization, formally objected to this proposal by letter to Pinnacle and C&H dated August 10, 2022. The Founders insisted on a founder veto right over any drag-along sale that would value the Company at less than $500,000,000 on an enterprise value basis. The Founders' position was that they should not be compelled to sell their controlling common stock position at a valuation they deem inadequate, particularly in a scenario where the preferred holders' liquidation preferences might result in the preferred holders receiving a disproportionate share of the sale proceeds relative to the common holders.

The existing preferred stock investors were divided on this issue. Ridgeline Ventures (Series A lead, represented by Priya Dasgupta) and Brindoval Capital Group LLC (Series C lead, represented by Diana Chen) supported the Founders' position and the inclusion of a $500,000,000 enterprise value threshold for the founder veto. Northgate Growth Partners (Series B lead, represented by Elliott Margolis) aligned with Pinnacle's position and opposed the founder veto, expressing concern that it would give the Founders an effective blocking right over liquidity events that might be favorable to the preferred holders.

No compromise was reached on this issue through the final negotiation session on November 2, 2022. The parties discussed various intermediate proposals, including a lower enterprise value threshold of $400,000,000, a sunset on the founder veto after a specified number of years, and a supermajority preferred holder approval requirement (e.g., 66⅔% or 75%) in lieu of a simple majority, but none of these alternatives was accepted by all parties.

D. Other Open Items

In addition to the foregoing principal areas of disagreement, a number of other items remain unresolved or unaddressed:

Pacific Summit Bank, N.A. Lender Consent. Verdana maintains a $10,000,000 revolving credit facility with Pacific Summit Bank, N.A. (the "Revolver"), of which $6,200,000 was drawn as of March 31, 2022. The Revolver bears interest at SOFR plus 3.50% per annum and matures on June 30, 2024. The credit agreement governing the Revolver contains negative covenants that restrict, among other things, the issuance of new equity securities (including preferred stock) without the prior written consent of the lender. It is our assessment, based on review of the credit agreement during diligence, that the issuance of the Series D Preferred Stock would likely require the consent of Pacific Summit Bank. Obtaining this lender consent was to be a condition precedent to closing under the SPA, and neither Verdana nor its counsel has initiated the consent process given the unresolved state of the commercial terms. This item will need to be addressed promptly if the parties resume negotiations and approach a closing.

Registration Rights and Information Rights. The parties had substantially agreed on the key terms of registration rights and information rights, though these terms have not been reduced to final, definitive documentation. On registration rights, the parties agreed in principle to two (2) demand registrations on Form S-1 (subject to customary underwriter cutback and hold-back provisions), unlimited piggyback registration rights, and registration on Form S-3 when the Company becomes eligible for such registration. On information rights, the parties agreed in principle that Verdana would provide the Series D holders with (i) unaudited quarterly financial statements within 45 days after the end of each fiscal quarter, (ii) annual audited financial statements within 90 days after the end of each fiscal year, and (iii) monthly management reports in a format to be mutually agreed. These terms remain subject to finalization in the definitive Investors' Rights Agreement.

IV. Customer Concentration Risk — Diligence Finding

During the course of the legal and commercial due diligence process, the C&H team, in coordination with Pinnacle's internal financial diligence team, identified significant customer concentration risk at Verdana that we believe warrants continued attention regardless of whether the investment ultimately proceeds.

As of the first quarter of 2022 (the most recent period for which data was available in the diligence process), Verdana's annual recurring revenue ("ARR") totaled $47,300,000. Of this amount, Meridian Logistics Corp. ("Meridian") — Verdana's largest customer — contributed $11,800,000, representing 24.9% of total ARR. This level of revenue dependence on a single customer is materially above the concentration thresholds that typically trigger heightened risk scrutiny in SaaS company valuations.

The concentration risk extends beyond Meridian. Verdana's top five customers by ARR contribution — Meridian Logistics Corp., Caldera Manufacturing Inc., Atlas Freight Holdings LLC, Brannock Industrial Group, and Solaris Warehousing Co. — collectively contributed $27,200,000 in ARR, or 57.5% of total ARR. The remaining ARR of approximately $20,100,000 is distributed across Verdana's broader customer base, but the top-heavy revenue profile creates meaningful volatility risk and limits the predictability of future revenue performance.

Of particular concern is the status of the Meridian contract. The current agreement between Verdana and Meridian is a three-year enterprise license agreement that commenced on January 1, 2021, and expires on December 31, 2023. The agreement provides for automatic renewal for successive one-year terms unless either party delivers written notice of termination at least 180 days prior to the expiration of the then-current term. This means that the earliest date on which Meridian could deliver a termination notice for the initial term expiration would be approximately July 4, 2023 (180 days prior to December 31, 2023).

During the diligence process, we learned that Meridian had recently undergone a change in chief executive officer, with the prior CEO departing in early 2022 and a new CEO — whose strategic priorities were not yet fully known — assuming the role. At or around the same time, Meridian issued a request for proposals ("RFP") for competitive supply chain optimization solutions, suggesting that the new management team was evaluating alternatives to the Verdana SCX platform. While the issuance of an RFP does not necessarily indicate an intent to terminate the Verdana relationship, it introduces meaningful uncertainty regarding the likelihood of renewal upon the December 31, 2023 expiration and, more broadly, regarding the durability of the revenue stream associated with Verdana's largest customer.

This concentration risk was a significant factor in Pinnacle's decision to maintain its proposed pre-money valuation at $260,000,000 and to resist upward movement toward Verdana's $320,000,000 proposal. As noted in Section III.A above, Pinnacle also proposed alternative mechanisms — specifically, a customer retention escrow and a revenue diversification earnout — that would have provided Pinnacle with downside protection in the event of a loss or material reduction of the Meridian relationship. Neither mechanism was accepted by Verdana, which took the position that its customer relationships are strong and that the RFP process at Meridian was a routine procurement exercise rather than a harbinger of churn.

V. Current Status of Transaction Documents

All transaction documents remain in draft form. None have been executed by any party, and no signatures have been exchanged on any document. The current status of each principal document is as follows:

Series D Preferred Stock Purchase Agreement (SPA). The most recent version is the second draft prepared by C&H and delivered to Langford Price on July 18, 2022, in response to Langford Price's June 22, 2022 markup. Open issues in the SPA include: the purchase price (reflecting the unresolved valuation gap); the scope and specificity of the representations and warranties (Langford Price proposed significant narrowing of several representations, including the IP ownership representation, the material contracts representation, and the financial statements representation); the indemnification provisions (including the cap on indemnification liability, which Pinnacle proposed at 100% of the purchase price and Langford Price proposed at 10%); the indemnification basket (Pinnacle proposed a first-dollar tipping basket of $500,000; Langford Price proposed a true deductible of $1,500,000); and the closing conditions (including the Pacific Summit Bank lender consent, the absence of material adverse changes, and the delivery of audited financial statements for the fiscal year ending December 31, 2021).

Amended and Restated Investors' Rights Agreement. The most recent version is Langford Price's markup, returned on July 22, 2022. This markup remains unresolved on anti-dilution protection (full-ratchet versus broad-based weighted average), liquidation preference (1.5x versus 1.0x non-participating), pay-to-play (included versus deleted), redemption rights (exercisable after five years versus not included), and protective provisions (scope of Series D consent rights). Additionally, certain provisions relating to co-sale rights and preemptive rights require reconciliation with the ROFR Agreement.

Amended and Restated Voting Agreement. The initial draft was delivered on June 20, 2022. The parties have partially agreed on board composition (seven-member board, as described in Section II above) but remain unresolved on the drag-along provisions, including the voting threshold, the enterprise value floor, and the founder veto right (as described in Section III.C above).

Amended and Restated Right of First Refusal and Co-Sale Agreement (ROFR Agreement). The initial draft was delivered on June 20, 2022. This document was substantially agreed between the parties. The agreed terms include a pro rata right of first refusal for all preferred holders on any proposed transfer of shares by the Founders or other common stockholders, and tag-along (co-sale) rights triggered by any proposed founder transfer exceeding 1% of the then-outstanding shares of the Company. Minor drafting comments remain but are not expected to present a barrier to finalization if the commercial terms are resolved.

Amended and Restated Certificate of Incorporation (Restated Certificate). The initial draft was delivered on June 8, 2022. This document must be revised to reflect the final agreed terms on Series D rights, preferences, and privileges, including the liquidation preference, anti-dilution protection, dividend rights, conversion rights, redemption rights (if any), and protective provisions. Because the Restated Certificate serves as the definitive charter document establishing the Series D terms, it cannot be finalized until the commercial negotiations are concluded.

Disclosure Schedules. A template for the Disclosure Schedules to the SPA was delivered on June 8, 2022. As of the date of this letter, Verdana has not populated the Disclosure Schedules with the required information. This task was deferred pending resolution of the commercial terms, as the final form of the representations and warranties in the SPA will determine the scope and specificity of the required disclosures.

Management Rights Letter and Indemnification Agreement. Drafts of both documents were circulated during the June 2022 document delivery. The Management Rights Letter grants Pinnacle certain management rights in the Company sufficient to qualify the investment as a "venture capital investment" for purposes of applicable ERISA regulations. The Indemnification Agreement provides indemnification to Pinnacle's board designee on terms substantially consistent with the indemnification provided to existing directors. Both documents were subject to comments from Langford Price that were not addressed given the focus on the more significant commercial issues.

VI. Financial Summary — Legal Fees Incurred

As of November 18, 2022, Calderwood & Harkness LLP has incurred total legal fees of $387,500 on this matter (Matter No. 1002-00004; Client No. PIN-0042). This amount represents fees for services rendered from the commencement of the engagement on April 19, 2022, through the date of this letter and encompasses all work performed in connection with due diligence, document drafting, negotiation, and related advisory services.

The total fees incurred fall within the estimated fee range of $350,000 to $450,000 that was communicated to Pinnacle at the time of engagement, as set forth in our engagement letter dated April 19, 2022. We note that the fees would likely have reached or exceeded the upper end of this range had the transaction proceeded to signing and closing, given the complexity of the remaining open issues and the number of parties involved in the negotiations.

A retainer deposit of $75,000 was received from Pinnacle in April 2022 and has been applied against the initial invoices rendered in that month and in May 2022. All invoices rendered to date have been paid in full, and there is no outstanding balance as of the date of this letter.

The principal billing rates for the C&H professionals who have worked on this matter are as follows:

If the matter is placed on hold as recommended, no further fees will accrue absent express instruction from Pinnacle to re-engage or to perform additional work in connection with the matter. The Firm will not undertake any billable work on the matter during the hold period without prior written authorization from Pinnacle.

VII. Recommendation

Based on the foregoing, I formally recommend that Pinnacle place the proposed Series D investment in Verdana Software, Inc. on hold and that the matter status in the Firm's records be changed to dormant, effective as of the earliest practicable date. Our target effective date for the status change is December 1, 2022, which would allow sufficient time for Pinnacle to confirm its agreement with this recommendation and for the Firm to complete any administrative steps associated with the status change.

The basis for this recommendation may be summarized as follows:

First, the parties remain materially apart on the most critical commercial terms. The $60,000,000 valuation gap — representing the difference between Pinnacle's $260,000,000 pre-money proposal and Verdana's $320,000,000 pre-money proposal — has persisted since the inception of negotiations and showed no meaningful movement through the final session on November 2, 2022. Neither the Brindoval compromise proposal ($290,000,000) nor Pinnacle's alternative risk-mitigation proposals (the customer retention escrow and the revenue diversification earnout) were accepted. Beyond valuation, the parties are separated by fundamental disagreements on the liquidation preference (1.5x versus 1.0x), anti-dilution protection (full-ratchet versus broad-based weighted average), and drag-along rights (preferred majority control versus founder veto below a $500,000,000 enterprise value threshold). The breadth and depth of these disagreements suggest that further negotiation, absent a material change in circumstances, is unlikely to be productive.

Second, the exclusivity agreement expired on September 30, 2022, and Verdana is presently free to pursue alternative financing from any source. There is a meaningful risk that Verdana may secure funding from another investor during any hold period, which could render the proposed Pinnacle investment moot. However, this risk is mitigated to some extent by Verdana's financial position (discussed below).

Third, continued expenditure of legal and advisory resources in the absence of a reasonable prospect of closing is not consistent with prudent fund management. The Firm has already incurred $387,500 in legal fees, and bringing the transaction to a successful conclusion would require significant additional investment of time and resources, including the resolution of all open commercial terms, the finalization and execution of all transaction documents, the population and negotiation of the Disclosure Schedules, the completion of the Pacific Summit Bank lender consent process, and other customary closing activities.

It is worth noting, however, that the passage of time may ultimately work in Pinnacle's favor. As reflected in the diligence materials, Verdana's cash position as of March 31, 2022, was approximately $22,400,000, and the Company reported trailing twelve-month EBITDA of negative $11,600,000, reflecting a cash burn profile consistent with a growth-stage enterprise software company prioritizing market expansion over near-term profitability. Assuming a continuation of this burn rate (and recognizing that actual cash burn may vary), Verdana's existing cash reserves would be expected to sustain operations for approximately 18 to 24 months from the date of the most recent balance sheet — that is, through approximately September 2023 to March 2024. This suggests that Verdana will need to raise additional capital within the next 12 to 18 months. If Verdana is unable to secure alternative funding at its desired $320,000,000 valuation — particularly in light of the current headwinds in SaaS valuations and the unresolved customer concentration risk — conditions may become more favorable for Pinnacle to re-engage at a lower valuation and on more favorable terms.

VIII. Preservation of Pinnacle's Ability to Re-Engage

We wish to assure you that placing the matter on hold will not prejudice Pinnacle's ability to re-engage with Verdana at a future date. The key considerations in this regard are as follows:

No Binding Commitments. No binding commitments have been made by either party in connection with the proposed transaction. The term sheet delivered by Pinnacle on April 22, 2022, was expressly non-binding (except as to the customary binding provisions relating to exclusivity, confidentiality, and governing law), and all transaction documents remain unexecuted drafts. Pinnacle has no legal obligation to proceed with or complete the investment, and there is no break-up fee, reverse termination fee, or similar penalty associated with a decision not to proceed.

Preservation of Work Product. Calderwood & Harkness will maintain all work product, draft documents, diligence materials, correspondence, research memoranda, and other materials in the matter file in accordance with the Firm's document retention policies. In the event Pinnacle elects to re-engage, the Firm will be able to resume work on short notice, leveraging the substantial body of work already completed. We anticipate that reactivation of the matter would require a period of updated diligence (to address developments during the hold period) and revised drafting (to reflect any changes in circumstances or terms), but the foundational work product would remain highly relevant and would significantly reduce the time and cost required to reach a signing-ready state.

Monitoring During Hold Period. The Firm recommends that Pinnacle monitor the following developments during the hold period, each of which could influence the timing and terms of any future re-engagement:

(a) Meridian Logistics Corp. Renewal Decision. As noted in Section IV, the Meridian enterprise license agreement expires on December 31, 2023, with a 180-day termination notice window. The earliest date on which Meridian could deliver a termination notice is approximately July 4, 2023. If Meridian elects not to renew — or if reports emerge suggesting that Meridian is migrating to a competing platform — this would represent a material adverse development for Verdana and could significantly weaken its bargaining position in any future financing negotiation. Conversely, a renewal by Meridian would mitigate the concentration risk and potentially support a higher valuation.

(b) Alternative Financing Announcements. Pinnacle should monitor for any public announcements, press releases, or regulatory filings (including Delaware Secretary of State filings reflecting the issuance of new series of preferred stock) indicating that Verdana has secured alternative financing. Such an announcement would likely foreclose the opportunity for Pinnacle to re-engage on the Series D investment as originally contemplated, though it would not necessarily preclude Pinnacle from participating in a subsequent round.

(c) SaaS Market Conditions and Comparable Valuation Multiples. The broader environment for SaaS company valuations has experienced significant compression in 2022, driven by rising interest rates, macroeconomic uncertainty, and a reset in growth equity pricing expectations. Pinnacle should continue to monitor comparable transaction multiples and public market SaaS valuations, as further compression could create additional leverage for Pinnacle in future discussions with Verdana.

If Pinnacle determines at any point during the hold period that it wishes to re-engage, Calderwood & Harkness recommends that the initial approach be made informally — either through a direct outreach to Verdana's counsel, Jonathan Hale, at Langford Price & Associates LLP, or through Verdana's financial advisor, Nathan Callister, at Hargrove Securities LLC — to gauge Verdana's updated posture, valuation expectations, and financing status before committing additional legal resources. This approach would allow Pinnacle to assess whether the negotiating dynamic has shifted sufficiently to warrant a resumption of active negotiations.

IX. Closing

Marcus, I want to thank you for Pinnacle's continued confidence in Calderwood & Harkness LLP. It has been a privilege to work with you and your team on this matter, and while I am disappointed that the negotiations have not yielded a signed transaction, I believe that the recommendation to place the matter on hold is the most prudent course of action under the circumstances. The work product generated during this engagement will serve as a strong foundation if and when the opportunity arises to re-engage with Verdana.

I respectfully request that you confirm Pinnacle's agreement with the recommendation to place the matter on hold at your earliest convenience, so that the Firm can formally change the matter status to dormant effective December 1, 2022. A brief email confirmation to me or to Beatrice Holloway will suffice for this purpose.

I am available to discuss this letter and the underlying recommendation by telephone at your convenience. Please do not hesitate to reach out at any time.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Harrison Wexford Partner, Mergers & Acquisitions Calderwood & Harkness LLP 101 Montgomery Street, Suite 3500 San Francisco, California 94104 Direct: (415) 782-9117 hwexford@calderwoodharkness.com

cc: (via email)

Elaine Whitford, Co-Founder & Managing Partner, Pinnacle Capital Management LLC Derek Sung, Co-Founder & Managing Partner, Pinnacle Capital Management LLC Beatrice Holloway, Partner, Calderwood & Harkness LLP Andrew Fitzpatrick, Associate, Calderwood & Harkness LLP

Enclosures: None. All work product, draft transaction documents, and diligence materials are maintained in the Firm's matter file (Matter No. 1002-00004) and are available upon request.

Professional	Role	Billing Rate
Harrison Wexford	Partner, Responsible Partner	$1,250/hour
Beatrice Holloway	Partner, Diligence Lead	$1,200/hour
Andrew Fitzpatrick	Senior Associate	$725/hour
Naomi Petersen	Associate	$550/hour

PRIVILEGED & CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION
CALDERWOOD & HARKNESS LLP Attorneys at Law
101 Montgomery Street, Suite 3500 San Francisco, California 94104
Telephone: (415) 782-9000 Facsimile: (415) 782-9001 www.calderwoodharkness.com
November 18, 2022
VIA EMAIL AND FIRST CLASS MAIL
Marcus Trejo Partner, Head of Growth Equity Pinnacle Capital Management LLC (as General Partner of Pinnacle Venture Fund II LP) 2400 Sand Hill Road, Suite 310 Menlo Park, California 94025
Re: Proposed $60,000,000 Series D Preferred Stock Investment in Verdana Software, Inc. — Recommendation to Place Matter on Hold
Matter No.: 1002-00004 Client No.: PIN-0042
Dear Marcus:
I. Purpose of Letter
I am writing in my capacity as Responsible Partner on the above-referenced matter to formally recommend that Pinnacle Venture Fund II LP ("Pinnacle" or the "Fund") place its proposed $60,000,000 Series D Preferred Stock investment in Verdana Software, Inc. ("Verdana" or the "Company") on hold and that the matter status be changed to dormant in our firm's records and billing systems. This recommendation is the product of careful deliberation following extensive discussion with members of the deal team at both Calderwood & Harkness LLP ("C&H" or the "Firm") and the Pinnacle investment team, and reflects our assessment that continued expenditure of legal resources is not advisable absent a material change in the negotiating dynamic between the parties.
This recommendation follows the final negotiation session held on November 2, 2022, at the offices of Hargrove Securities LLC in San Francisco, at which senior representatives of both Pinnacle and Verdana — together with their respective legal and financial advisors — were unable to reach agreement on key commercial terms, most notably the pre-money valuation, the structure of the liquidation preference, the form of anti-dilution protection, and the scope of drag-along rights. Despite productive discussions on certain subsidiary matters earlier in the process, the parties remain far apart on the core economic terms that would define the investment.
As additional context for this recommendation, I note that the exclusivity agreement governing the parties' negotiations expired on September 30, 2022, and discussions have continued on a non-exclusive basis since that date without material progress toward resolution of the outstanding commercial issues. The absence of exclusivity means that Verdana is presently free to solicit, entertain, and close on alternative financing proposals, which introduces additional risk that continued negotiations may prove futile if the Company secures capital from another source in the interim.
The purpose of this letter is to (a) provide a comprehensive summary of the transaction, the engagement history, and the current status of negotiations and documentation; (b) identify the specific unresolved commercial terms that have prevented the parties from reaching agreement; (c) highlight certain diligence findings that remain relevant to the investment thesis; (d) summarize the legal fees incurred to date; and (e) set forth our formal recommendation and the steps we propose to take in connection with placing the matter on hold. I trust this letter will serve as a useful reference for your records and for any future deliberations regarding the potential resumption of discussions with Verdana.
II. Summary of Transaction and Engagement History
Calderwood & Harkness LLP was engaged on April 19, 2022, pursuant to an engagement letter of even date executed by you on behalf of Pinnacle Capital Management LLC in its capacity as General Partner of Pinnacle Venture Fund II LP, to represent the Fund in connection with a proposed $60,000,000 minority growth equity investment in Verdana Software, Inc. Verdana is a Delaware C-corporation headquartered in Portland, Oregon, that develops and commercializes an AI-powered supply chain optimization software-as-a-service platform marketed under the trade name "Verdana SCX." The Company was founded in 2016 by Raj Anand (Chief Executive Officer) and Lena Kovac (Chief Technology Officer) and has raised approximately $85,000,000 in prior institutional venture capital financing across three rounds.
The transaction as originally contemplated involved the purchase by Pinnacle of newly issued shares of Series D Preferred Stock of Verdana representing approximately 18.75% of the Company's fully-diluted capitalization on a post-closing basis. The investment was intended to be a lead investment by Pinnacle, with no co-investors identified at the outset, although the term sheet reserved the right for Pinnacle to syndicate up to $15,000,000 of the commitment to one or more co-investors prior to closing, subject to Verdana's consent.
The key milestones in the engagement to date are as follows:
April 22, 2022. Pinnacle delivered a non-binding term sheet to Verdana proposing a $260,000,000 pre-money valuation, equivalent to a price per share of $3.25 based on 80,000,000 fully-diluted pre-investment shares outstanding. At this valuation, the $60,000,000 investment would result in the issuance of approximately 18,461,538 shares of Series D Preferred Stock, representing approximately 18.75% of the post-close fully-diluted capitalization.
May 3, 2022. Verdana, through its placement agent Hargrove Securities LLC ("Hargrove," led by Nathan Callister), delivered a counter-term sheet proposing a pre-money valuation of $320,000,000, equivalent to a price per share of $4.00. This represented a $60,000,000 gap between the parties' respective valuation positions — a gap that, as discussed in detail below, has persisted through the entirety of the negotiations.
May 12, 2022. The parties executed a mutual exclusivity agreement with a 60-day initial term expiring on July 11, 2022. The exclusivity agreement contained customary standstill and no-shop provisions prohibiting Verdana from soliciting, encouraging, or entering into discussions with any third party regarding an equity financing or similar transaction during the exclusivity period.
July 8, 2022. The exclusivity agreement was extended by mutual written amendment for a period of approximately five weeks, through August 15, 2022.
August 15, 2022. The exclusivity agreement was further extended by a second mutual written amendment through September 30, 2022. This was the final extension; the exclusivity period has not been renewed and expired by its terms on September 30, 2022.
May 16, 2022. Legal, financial, and commercial due diligence commenced. The C&H diligence team — led by Beatrice Holloway and staffed by Andrew Fitzpatrick and Naomi Petersen — reviewed corporate formation and governance documents, material contracts, intellectual property filings and licenses, employment agreements and equity incentive plan documentation, real property leases, insurance policies, litigation history, regulatory compliance matters, customer agreements, and financial statements and projections.
June 8–June 25, 2022. C&H prepared and delivered to Verdana's counsel, Langford Price & Associates LLP ("Langford Price," led by Jonathan Hale), initial drafts of the principal transaction documents, including: (i) the Series D Preferred Stock Purchase Agreement (the "SPA"), delivered June 8, 2022; (ii) the Amended and Restated Investors' Rights Agreement, delivered June 15, 2022; (iii) the Amended and Restated Right of First Refusal and Co-Sale Agreement (the "ROFR Agreement"), delivered June 20, 2022; (iv) the Amended and Restated Voting Agreement, delivered June 20, 2022; (v) the Amended and Restated Certificate of Incorporation of Verdana Software, Inc. (the "Restated Certificate"), delivered June 8, 2022; (vi) the Management Rights Letter, delivered June 22, 2022; (vii) a form of Indemnification Agreement for the Pinnacle board designee, delivered June 22, 2022; and (viii) a template for the Disclosure Schedules to the SPA, delivered June 8, 2022.
June 22, 2022. Langford Price returned its initial markup of the SPA, reflecting extensive revisions to the representations and warranties, indemnification provisions, closing conditions, and economic terms. The markup was accompanied by a 14-page issues memorandum identifying areas of disagreement and requesting additional information from Pinnacle regarding certain proposed terms.
July 15, 2022. C&H delivered to Pinnacle a comprehensive legal due diligence summary memorandum (the "Diligence Memo"), summarizing findings across all workstreams and identifying material risks, including the customer concentration risk discussed in Section IV below.
July 18, 2022. C&H delivered a revised second draft of the SPA to Langford Price, responding to the issues raised in Langford Price's June 22 markup and incorporating certain revisions directed by Pinnacle following review of the Diligence Memo.
July 22, 2022. Langford Price returned its markup of the Amended and Restated Investors' Rights Agreement. This markup reflected fundamental disagreements on anti-dilution protection, liquidation preference, pay-to-play provisions, redemption rights, and certain protective provisions, as discussed in Section III.B below.
September 6, 2022. Following several rounds of discussion among Pinnacle, Verdana, and the existing investors, partial agreement was reached on board composition. The parties agreed to a seven-member board of directors structured as follows: two (2) designees of the Founders (Raj Anand and Lena Kovac); one (1) designee of Ridgeline Ventures (the Series A lead investor); one (1) designee of Northgate Growth Partners (the Series B lead investor); one (1) designee of Brindoval Capital Group LLC (the Series C lead investor); one (1) designee of Pinnacle; and one (1) independent director to be mutually agreed by the Founders and the holders of a majority of the then-outstanding preferred stock. Board observer rights for Pinnacle were also agreed in principle, although the definitive terms were not finalized.
September 19, 2022. Pinnacle formally communicated its revised $260,000,000 pre-money valuation proposal to Verdana by letter, referencing the diligence findings (including customer concentration risk) as support for its valuation position.
October 14, 2022. Brindoval Capital Group LLC, the Series C lead investor represented by Diana Chen, proposed a compromise valuation of $290,000,000 pre-money ($3.625 per share), which would have resulted in the issuance of approximately 16,551,724 Series D shares and approximately 17.14% post-close ownership for Pinnacle. Pinnacle declined this proposal as insufficient to meet its target ownership percentage of 18.75%.
November 2, 2022. The final negotiation session was held in person at Hargrove Securities' offices. The session was attended by you (for Pinnacle), Raj Anand and Lena Kovac (for Verdana), Diana Chen (for Brindoval Capital Group), Nathan Callister (for Hargrove), Jonathan Hale (for Langford Price), and me and Beatrice Holloway (for C&H). Despite extended discussion, the parties were unable to bridge the valuation gap or resolve the other outstanding commercial terms described in Section III below.
No transaction documents have been executed to date, and no binding commitments of any kind have been made by either party with respect to the proposed investment.
III. Unresolved Commercial Terms
Despite extensive negotiations over a period of approximately seven months, a number of material commercial terms remain unresolved. These are summarized below in order of significance as assessed by the C&H deal team.
A. Valuation Gap
The central impasse between the parties remains the $60,000,000 gap between Pinnacle's proposed pre-money valuation of $260,000,000 and Verdana's proposed pre-money valuation of $320,000,000. This gap has persisted essentially unchanged from the initial exchange of term sheets in late April and early May 2022 through the final negotiation session on November 2, 2022.
The implications of this gap for the economic structure of the investment are significant:
Pinnacle's Proposal ($260,000,000 Pre-Money). At a pre-money valuation of $260,000,000, based on 80,000,000 fully-diluted pre-investment shares outstanding, the Series D price per share would be $3.25 (calculated as $260,000,000 ÷ 80,000,000 shares). Pinnacle's $60,000,000 investment at $3.25 per share would result in the issuance of approximately 18,461,538 shares of Series D Preferred Stock, and Pinnacle would hold approximately 18.75% of Verdana's fully-diluted post-closing capitalization (18,461,538 ÷ 98,461,538 total post-close fully-diluted shares).
Verdana's Proposal ($320,000,000 Pre-Money). At a pre-money valuation of $320,000,000, the price per share would be $4.00 (calculated as $320,000,000 ÷ 80,000,000 shares). At this price, Pinnacle's $60,000,000 investment would result in the issuance of only 15,000,000 Series D shares, and Pinnacle would hold approximately 15.79% of the post-closing fully-diluted capitalization (15,000,000 ÷ 95,000,000 total post-close fully-diluted shares). Moreover, if Verdana's proposed ESOP expansion of 5,000,000 shares (discussed below) is included in the pre-close fully-diluted share count — bringing the fully-diluted base to 100,000,000 shares — the effective price per share would remain $4.00 ($320,000,000 ÷ 80,000,000 shares, excluding the ESOP expansion from the pre-money calculation as proposed by Verdana), and Pinnacle's post-close ownership would be reduced to approximately 15.00% (15,000,000 ÷ 100,000,000).
Pinnacle formally communicated its revised $260,000,000 pre-money proposal by letter dated September 19, 2022, referencing the customer concentration risk identified during diligence (discussed in Section IV below) and broader SaaS market valuation compression as support for its position. Verdana rejected this proposal, maintaining its insistence on the $320,000,000 pre-money valuation.
On October 14, 2022, Brindoval Capital Group LLC, the Series C lead investor, through its principal Diana Chen, proposed a compromise at a $290,000,000 pre-money valuation. At $290,000,000, the price per share would be $3.625, the investment would result in the issuance of approximately 16,551,724 Series D shares, and Pinnacle would hold approximately 17.14% of the post-closing fully-diluted capitalization. While this proposal represented a genuine effort at compromise, Pinnacle declined the Brindoval proposal as insufficient to meet its target ownership percentage of 18.75%, which the Fund's investment committee had identified as a minimum threshold for the deployment of $60,000,000 of Fund capital.
In addition to the base valuation disagreement, the treatment of Verdana's employee stock option pool ("ESOP") remains unresolved and further complicates the valuation discussion. Verdana insists on expanding the ESOP by 5,000,000 shares — from the current 12,000,000 authorized and reserved shares to 17,000,000 shares — prior to closing, with the ESOP expansion shares included in the fully-diluted share count for purposes of calculating the post-close ownership percentages but excluded from the pre-money valuation calculation (i.e., Verdana's position is that the ESOP expansion would dilute all stockholders equally but would not reduce the pre-money valuation or the per-share price). Pinnacle's position, consistent with standard venture capital practice, is that any ESOP expansion should be included in the pre-money capitalization — that is, the additional 5,000,000 option shares should be treated as part of the fully-diluted share count used to calculate the pre-money price per share, thereby effectively requiring the existing stockholders (rather than the new investor) to bear the dilution associated with the expanded pool.
The valuation disagreement was compounded by the customer concentration risk identified during diligence, which is discussed in detail in Section IV below and which, in Pinnacle's view, supports a meaningfully lower valuation than the $320,000,000 proposed by Verdana. As an alternative to a direct reduction in the pre-money valuation, Pinnacle proposed at various points during the negotiations a customer retention escrow mechanism and, separately, an earnout mechanism tied to revenue diversification milestones, both of which would have addressed Pinnacle's customer concentration concerns while preserving Verdana's headline valuation. Neither proposal was accepted by Verdana.
B. Protective Provisions
Beyond the valuation gap, the parties remain materially apart on several protective provisions that would define the economic rights and protections of the Series D Preferred Stock.
Liquidation Preference. Pinnacle proposed a 1.5x non-participating liquidation preference on the Series D Preferred Stock. Under this proposal, in the event of a liquidation, dissolution, winding up, or deemed liquidation event (including a merger, acquisition, or asset sale), the holders of Series D Preferred Stock would be entitled to receive an amount equal to 1.5 times the original investment amount — $60,000,000 × 1.5 = $90,000,000 — in preference to, and prior to any distribution to, the holders of common stock. The Series D holders would not participate with the common stock in any distribution in excess of the 1.5x preference amount (i.e., the preference would be non-participating). Verdana and the existing investors have insisted on a 1.0x non-participating liquidation preference ($60,000,000), which is consistent with the terms of the Series A Preferred Stock held by Ridgeline Ventures (led by Priya Dasgupta), the Series B Preferred Stock held by Northgate Growth Partners (led by Elliott Margolis), and the Series C Preferred Stock held by Brindoval Capital Group LLC (led by Diana Chen). The existing investors have taken the position that granting a 1.5x preference to the Series D would create an inequitable seniority structure within the capital stack and could complicate future fundraising.
Anti-Dilution Protection. Pinnacle proposed full-ratchet anti-dilution protection for the Series D Preferred Stock. Under a full-ratchet mechanism, if Verdana issues equity securities at a per-share price below the Series D original issuance price, the Series D conversion price would be adjusted downward to equal the price at which such new shares were issued, regardless of the number of shares issued in the dilutive financing. Verdana offered broad-based weighted average anti-dilution protection, under which the conversion price would be adjusted using a formula that takes into account both the price and the number of shares issued in the dilutive financing, resulting in a less severe adjustment. Broad-based weighted average anti-dilution is the standard in all three prior preferred stock rounds (Series A, Series B, and Series C). Brindoval Capital Group LLC expressly objected to the granting of full-ratchet anti-dilution protection to the Series D, arguing that it would create an inconsistency in the capital structure that could deter future investors and would disproportionately disadvantage earlier-round preferred holders in any down-round scenario.
Consent Rights. Pinnacle proposed that the Series D holders (or, in certain cases, Pinnacle as the lead Series D holder) would have consent rights over (a) the incurrence by Verdana of any new indebtedness in excess of $5,000,000 in the aggregate, and (b) the adoption of or material deviation from annual operating budgets, with "material deviation" defined as any variance exceeding 15% of the board-approved operating plan. Verdana's counsel proposed narrowing the indebtedness consent threshold to $15,000,000 and eliminating the budget deviation consent right entirely, arguing that the latter would impede management's ability to respond to market conditions and would be unduly burdensome for a growth-stage company. These proposals remain unresolved.
Pay-to-Play. Pinnacle proposed a mandatory pay-to-play provision applicable to all holders of preferred stock in any future qualified financing round. Under this provision, any holder of preferred stock that fails to purchase its pro rata share of new securities offered in a future financing round would have its preferred stock automatically converted into common stock, thereby extinguishing the holder's liquidation preference, anti-dilution protection, and other preferred stock rights. Pinnacle viewed this provision as essential to align incentives and to ensure that all preferred holders participate proportionally in supporting the Company through future capital needs. Langford Price, on behalf of Verdana, deleted the pay-to-play provision in its entirety in its markup of the Investors' Rights Agreement, and the existing investors did not support its inclusion.
Redemption Rights. Pinnacle proposed that the Series D Preferred Stock carry mandatory redemption rights exercisable at the election of the holders of a majority of the then-outstanding Series D shares at any time after the fifth anniversary of the closing date. Upon exercise, Verdana would be required to redeem the outstanding Series D shares at a price per share equal to the original issuance price plus all accrued and unpaid dividends. Verdana's counsel has neither accepted nor rejected this proposal, and the issue remains open.
Dividends. On a positive note, the parties have reached agreement on the dividend provisions. The Series D Preferred Stock will accrue cumulative, non-compounding dividends at a rate of 8% per annum of the original issuance price, payable when and if declared by the board of directors. Based on a $60,000,000 aggregate original issuance price, this results in an annual dividend accrual of $4,800,000. This is one of the few economic terms on which the parties have achieved consensus.
C. Drag-Along Rights
The structure and trigger thresholds for drag-along rights have been a significant source of contention throughout the negotiations. Pinnacle proposed a drag-along provision under which holders of a majority of the then-outstanding shares of preferred stock (voting together as a single class on an as-converted basis) could require all stockholders — including holders of common stock — to consent to and participate in a sale of the Company (whether by merger, stock sale, or asset sale) or an initial public offering, on the terms approved by the requisite majority of preferred holders.
Verdana's co-founders, Raj Anand (CEO) and Lena Kovac (CTO), who collectively hold 28,000,000 shares of common stock representing 35.0% of the pre-investment fully-diluted capitalization, formally objected to this proposal by letter to Pinnacle and C&H dated August 10, 2022. The Founders insisted on a founder veto right over any drag-along sale that would value the Company at less than $500,000,000 on an enterprise value basis. The Founders' position was that they should not be compelled to sell their controlling common stock position at a valuation they deem inadequate, particularly in a scenario where the preferred holders' liquidation preferences might result in the preferred holders receiving a disproportionate share of the sale proceeds relative to the common holders.
The existing preferred stock investors were divided on this issue. Ridgeline Ventures (Series A lead, represented by Priya Dasgupta) and Brindoval Capital Group LLC (Series C lead, represented by Diana Chen) supported the Founders' position and the inclusion of a $500,000,000 enterprise value threshold for the founder veto. Northgate Growth Partners (Series B lead, represented by Elliott Margolis) aligned with Pinnacle's position and opposed the founder veto, expressing concern that it would give the Founders an effective blocking right over liquidity events that might be favorable to the preferred holders.
No compromise was reached on this issue through the final negotiation session on November 2, 2022. The parties discussed various intermediate proposals, including a lower enterprise value threshold of $400,000,000, a sunset on the founder veto after a specified number of years, and a supermajority preferred holder approval requirement (e.g., 66⅔% or 75%) in lieu of a simple majority, but none of these alternatives was accepted by all parties.
D. Other Open Items
In addition to the foregoing principal areas of disagreement, a number of other items remain unresolved or unaddressed:
Pacific Summit Bank, N.A. Lender Consent. Verdana maintains a $10,000,000 revolving credit facility with Pacific Summit Bank, N.A. (the "Revolver"), of which $6,200,000 was drawn as of March 31, 2022. The Revolver bears interest at SOFR plus 3.50% per annum and matures on June 30, 2024. The credit agreement governing the Revolver contains negative covenants that restrict, among other things, the issuance of new equity securities (including preferred stock) without the prior written consent of the lender. It is our assessment, based on review of the credit agreement during diligence, that the issuance of the Series D Preferred Stock would likely require the consent of Pacific Summit Bank. Obtaining this lender consent was to be a condition precedent to closing under the SPA, and neither Verdana nor its counsel has initiated the consent process given the unresolved state of the commercial terms. This item will need to be addressed promptly if the parties resume negotiations and approach a closing.
Registration Rights and Information Rights. The parties had substantially agreed on the key terms of registration rights and information rights, though these terms have not been reduced to final, definitive documentation. On registration rights, the parties agreed in principle to two (2) demand registrations on Form S-1 (subject to customary underwriter cutback and hold-back provisions), unlimited piggyback registration rights, and registration on Form S-3 when the Company becomes eligible for such registration. On information rights, the parties agreed in principle that Verdana would provide the Series D holders with (i) unaudited quarterly financial statements within 45 days after the end of each fiscal quarter, (ii) annual audited financial statements within 90 days after the end of each fiscal year, and (iii) monthly management reports in a format to be mutually agreed. These terms remain subject to finalization in the definitive Investors' Rights Agreement.
IV. Customer Concentration Risk — Diligence Finding
During the course of the legal and commercial due diligence process, the C&H team, in coordination with Pinnacle's internal financial diligence team, identified significant customer concentration risk at Verdana that we believe warrants continued attention regardless of whether the investment ultimately proceeds.
As of the first quarter of 2022 (the most recent period for which data was available in the diligence process), Verdana's annual recurring revenue ("ARR") totaled $47,300,000. Of this amount, Meridian Logistics Corp. ("Meridian") — Verdana's largest customer — contributed $11,800,000, representing 24.9% of total ARR. This level of revenue dependence on a single customer is materially above the concentration thresholds that typically trigger heightened risk scrutiny in SaaS company valuations.
The concentration risk extends beyond Meridian. Verdana's top five customers by ARR contribution — Meridian Logistics Corp., Caldera Manufacturing Inc., Atlas Freight Holdings LLC, Brannock Industrial Group, and Solaris Warehousing Co. — collectively contributed $27,200,000 in ARR, or 57.5% of total ARR. The remaining ARR of approximately $20,100,000 is distributed across Verdana's broader customer base, but the top-heavy revenue profile creates meaningful volatility risk and limits the predictability of future revenue performance.
Of particular concern is the status of the Meridian contract. The current agreement between Verdana and Meridian is a three-year enterprise license agreement that commenced on January 1, 2021, and expires on December 31, 2023. The agreement provides for automatic renewal for successive one-year terms unless either party delivers written notice of termination at least 180 days prior to the expiration of the then-current term. This means that the earliest date on which Meridian could deliver a termination notice for the initial term expiration would be approximately July 4, 2023 (180 days prior to December 31, 2023).
During the diligence process, we learned that Meridian had recently undergone a change in chief executive officer, with the prior CEO departing in early 2022 and a new CEO — whose strategic priorities were not yet fully known — assuming the role. At or around the same time, Meridian issued a request for proposals ("RFP") for competitive supply chain optimization solutions, suggesting that the new management team was evaluating alternatives to the Verdana SCX platform. While the issuance of an RFP does not necessarily indicate an intent to terminate the Verdana relationship, it introduces meaningful uncertainty regarding the likelihood of renewal upon the December 31, 2023 expiration and, more broadly, regarding the durability of the revenue stream associated with Verdana's largest customer.
This concentration risk was a significant factor in Pinnacle's decision to maintain its proposed pre-money valuation at $260,000,000 and to resist upward movement toward Verdana's $320,000,000 proposal. As noted in Section III.A above, Pinnacle also proposed alternative mechanisms — specifically, a customer retention escrow and a revenue diversification earnout — that would have provided Pinnacle with downside protection in the event of a loss or material reduction of the Meridian relationship. Neither mechanism was accepted by Verdana, which took the position that its customer relationships are strong and that the RFP process at Meridian was a routine procurement exercise rather than a harbinger of churn.
V. Current Status of Transaction Documents
All transaction documents remain in draft form. None have been executed by any party, and no signatures have been exchanged on any document. The current status of each principal document is as follows:
Series D Preferred Stock Purchase Agreement (SPA). The most recent version is the second draft prepared by C&H and delivered to Langford Price on July 18, 2022, in response to Langford Price's June 22, 2022 markup. Open issues in the SPA include: the purchase price (reflecting the unresolved valuation gap); the scope and specificity of the representations and warranties (Langford Price proposed significant narrowing of several representations, including the IP ownership representation, the material contracts representation, and the financial statements representation); the indemnification provisions (including the cap on indemnification liability, which Pinnacle proposed at 100% of the purchase price and Langford Price proposed at 10%); the indemnification basket (Pinnacle proposed a first-dollar tipping basket of $500,000; Langford Price proposed a true deductible of $1,500,000); and the closing conditions (including the Pacific Summit Bank lender consent, the absence of material adverse changes, and the delivery of audited financial statements for the fiscal year ending December 31, 2021).
Amended and Restated Investors' Rights Agreement. The most recent version is Langford Price's markup, returned on July 22, 2022. This markup remains unresolved on anti-dilution protection (full-ratchet versus broad-based weighted average), liquidation preference (1.5x versus 1.0x non-participating), pay-to-play (included versus deleted), redemption rights (exercisable after five years versus not included), and protective provisions (scope of Series D consent rights). Additionally, certain provisions relating to co-sale rights and preemptive rights require reconciliation with the ROFR Agreement.
Amended and Restated Voting Agreement. The initial draft was delivered on June 20, 2022. The parties have partially agreed on board composition (seven-member board, as described in Section II above) but remain unresolved on the drag-along provisions, including the voting threshold, the enterprise value floor, and the founder veto right (as described in Section III.C above).
Amended and Restated Right of First Refusal and Co-Sale Agreement (ROFR Agreement). The initial draft was delivered on June 20, 2022. This document was substantially agreed between the parties. The agreed terms include a pro rata right of first refusal for all preferred holders on any proposed transfer of shares by the Founders or other common stockholders, and tag-along (co-sale) rights triggered by any proposed founder transfer exceeding 1% of the then-outstanding shares of the Company. Minor drafting comments remain but are not expected to present a barrier to finalization if the commercial terms are resolved.
Amended and Restated Certificate of Incorporation (Restated Certificate). The initial draft was delivered on June 8, 2022. This document must be revised to reflect the final agreed terms on Series D rights, preferences, and privileges, including the liquidation preference, anti-dilution protection, dividend rights, conversion rights, redemption rights (if any), and protective provisions. Because the Restated Certificate serves as the definitive charter document establishing the Series D terms, it cannot be finalized until the commercial negotiations are concluded.
Disclosure Schedules. A template for the Disclosure Schedules to the SPA was delivered on June 8, 2022. As of the date of this letter, Verdana has not populated the Disclosure Schedules with the required information. This task was deferred pending resolution of the commercial terms, as the final form of the representations and warranties in the SPA will determine the scope and specificity of the required disclosures.
Management Rights Letter and Indemnification Agreement. Drafts of both documents were circulated during the June 2022 document delivery. The Management Rights Letter grants Pinnacle certain management rights in the Company sufficient to qualify the investment as a "venture capital investment" for purposes of applicable ERISA regulations. The Indemnification Agreement provides indemnification to Pinnacle's board designee on terms substantially consistent with the indemnification provided to existing directors. Both documents were subject to comments from Langford Price that were not addressed given the focus on the more significant commercial issues.
VI. Financial Summary — Legal Fees Incurred
As of November 18, 2022, Calderwood & Harkness LLP has incurred total legal fees of $387,500 on this matter (Matter No. 1002-00004; Client No. PIN-0042). This amount represents fees for services rendered from the commencement of the engagement on April 19, 2022, through the date of this letter and encompasses all work performed in connection with due diligence, document drafting, negotiation, and related advisory services.
The total fees incurred fall within the estimated fee range of $350,000 to $450,000 that was communicated to Pinnacle at the time of engagement, as set forth in our engagement letter dated April 19, 2022. We note that the fees would likely have reached or exceeded the upper end of this range had the transaction proceeded to signing and closing, given the complexity of the remaining open issues and the number of parties involved in the negotiations.
A retainer deposit of $75,000 was received from Pinnacle in April 2022 and has been applied against the initial invoices rendered in that month and in May 2022. All invoices rendered to date have been paid in full, and there is no outstanding balance as of the date of this letter.
The principal billing rates for the C&H professionals who have worked on this matter are as follows:
If the matter is placed on hold as recommended, no further fees will accrue absent express instruction from Pinnacle to re-engage or to perform additional work in connection with the matter. The Firm will not undertake any billable work on the matter during the hold period without prior written authorization from Pinnacle.
VII. Recommendation
Based on the foregoing, I formally recommend that Pinnacle place the proposed Series D investment in Verdana Software, Inc. on hold and that the matter status in the Firm's records be changed to dormant, effective as of the earliest practicable date. Our target effective date for the status change is December 1, 2022, which would allow sufficient time for Pinnacle to confirm its agreement with this recommendation and for the Firm to complete any administrative steps associated with the status change.
The basis for this recommendation may be summarized as follows:
First, the parties remain materially apart on the most critical commercial terms. The $60,000,000 valuation gap — representing the difference between Pinnacle's $260,000,000 pre-money proposal and Verdana's $320,000,000 pre-money proposal — has persisted since the inception of negotiations and showed no meaningful movement through the final session on November 2, 2022. Neither the Brindoval compromise proposal ($290,000,000) nor Pinnacle's alternative risk-mitigation proposals (the customer retention escrow and the revenue diversification earnout) were accepted. Beyond valuation, the parties are separated by fundamental disagreements on the liquidation preference (1.5x versus 1.0x), anti-dilution protection (full-ratchet versus broad-based weighted average), and drag-along rights (preferred majority control versus founder veto below a $500,000,000 enterprise value threshold). The breadth and depth of these disagreements suggest that further negotiation, absent a material change in circumstances, is unlikely to be productive.
Second, the exclusivity agreement expired on September 30, 2022, and Verdana is presently free to pursue alternative financing from any source. There is a meaningful risk that Verdana may secure funding from another investor during any hold period, which could render the proposed Pinnacle investment moot. However, this risk is mitigated to some extent by Verdana's financial position (discussed below).
Third, continued expenditure of legal and advisory resources in the absence of a reasonable prospect of closing is not consistent with prudent fund management. The Firm has already incurred $387,500 in legal fees, and bringing the transaction to a successful conclusion would require significant additional investment of time and resources, including the resolution of all open commercial terms, the finalization and execution of all transaction documents, the population and negotiation of the Disclosure Schedules, the completion of the Pacific Summit Bank lender consent process, and other customary closing activities.
It is worth noting, however, that the passage of time may ultimately work in Pinnacle's favor. As reflected in the diligence materials, Verdana's cash position as of March 31, 2022, was approximately $22,400,000, and the Company reported trailing twelve-month EBITDA of negative $11,600,000, reflecting a cash burn profile consistent with a growth-stage enterprise software company prioritizing market expansion over near-term profitability. Assuming a continuation of this burn rate (and recognizing that actual cash burn may vary), Verdana's existing cash reserves would be expected to sustain operations for approximately 18 to 24 months from the date of the most recent balance sheet — that is, through approximately September 2023 to March 2024. This suggests that Verdana will need to raise additional capital within the next 12 to 18 months. If Verdana is unable to secure alternative funding at its desired $320,000,000 valuation — particularly in light of the current headwinds in SaaS valuations and the unresolved customer concentration risk — conditions may become more favorable for Pinnacle to re-engage at a lower valuation and on more favorable terms.
VIII. Preservation of Pinnacle's Ability to Re-Engage
We wish to assure you that placing the matter on hold will not prejudice Pinnacle's ability to re-engage with Verdana at a future date. The key considerations in this regard are as follows:
No Binding Commitments. No binding commitments have been made by either party in connection with the proposed transaction. The term sheet delivered by Pinnacle on April 22, 2022, was expressly non-binding (except as to the customary binding provisions relating to exclusivity, confidentiality, and governing law), and all transaction documents remain unexecuted drafts. Pinnacle has no legal obligation to proceed with or complete the investment, and there is no break-up fee, reverse termination fee, or similar penalty associated with a decision not to proceed.
Preservation of Work Product. Calderwood & Harkness will maintain all work product, draft documents, diligence materials, correspondence, research memoranda, and other materials in the matter file in accordance with the Firm's document retention policies. In the event Pinnacle elects to re-engage, the Firm will be able to resume work on short notice, leveraging the substantial body of work already completed. We anticipate that reactivation of the matter would require a period of updated diligence (to address developments during the hold period) and revised drafting (to reflect any changes in circumstances or terms), but the foundational work product would remain highly relevant and would significantly reduce the time and cost required to reach a signing-ready state.
Monitoring During Hold Period. The Firm recommends that Pinnacle monitor the following developments during the hold period, each of which could influence the timing and terms of any future re-engagement:
(a) Meridian Logistics Corp. Renewal Decision. As noted in Section IV, the Meridian enterprise license agreement expires on December 31, 2023, with a 180-day termination notice window. The earliest date on which Meridian could deliver a termination notice is approximately July 4, 2023. If Meridian elects not to renew — or if reports emerge suggesting that Meridian is migrating to a competing platform — this would represent a material adverse development for Verdana and could significantly weaken its bargaining position in any future financing negotiation. Conversely, a renewal by Meridian would mitigate the concentration risk and potentially support a higher valuation.
(b) Alternative Financing Announcements. Pinnacle should monitor for any public announcements, press releases, or regulatory filings (including Delaware Secretary of State filings reflecting the issuance of new series of preferred stock) indicating that Verdana has secured alternative financing. Such an announcement would likely foreclose the opportunity for Pinnacle to re-engage on the Series D investment as originally contemplated, though it would not necessarily preclude Pinnacle from participating in a subsequent round.
(c) SaaS Market Conditions and Comparable Valuation Multiples. The broader environment for SaaS company valuations has experienced significant compression in 2022, driven by rising interest rates, macroeconomic uncertainty, and a reset in growth equity pricing expectations. Pinnacle should continue to monitor comparable transaction multiples and public market SaaS valuations, as further compression could create additional leverage for Pinnacle in future discussions with Verdana.
If Pinnacle determines at any point during the hold period that it wishes to re-engage, Calderwood & Harkness recommends that the initial approach be made informally — either through a direct outreach to Verdana's counsel, Jonathan Hale, at Langford Price & Associates LLP, or through Verdana's financial advisor, Nathan Callister, at Hargrove Securities LLC — to gauge Verdana's updated posture, valuation expectations, and financing status before committing additional legal resources. This approach would allow Pinnacle to assess whether the negotiating dynamic has shifted sufficiently to warrant a resumption of active negotiations.
IX. Closing
Marcus, I want to thank you for Pinnacle's continued confidence in Calderwood & Harkness LLP. It has been a privilege to work with you and your team on this matter, and while I am disappointed that the negotiations have not yielded a signed transaction, I believe that the recommendation to place the matter on hold is the most prudent course of action under the circumstances. The work product generated during this engagement will serve as a strong foundation if and when the opportunity arises to re-engage with Verdana.
I respectfully request that you confirm Pinnacle's agreement with the recommendation to place the matter on hold at your earliest convenience, so that the Firm can formally change the matter status to dormant effective December 1, 2022. A brief email confirmation to me or to Beatrice Holloway will suffice for this purpose.
I am available to discuss this letter and the underlying recommendation by telephone at your convenience. Please do not hesitate to reach out at any time.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Harrison Wexford Partner, Mergers & Acquisitions Calderwood & Harkness LLP 101 Montgomery Street, Suite 3500 San Francisco, California 94104 Direct: (415) 782-9117 hwexford@calderwoodharkness.com
cc: (via email)
Elaine Whitford, Co-Founder & Managing Partner, Pinnacle Capital Management LLC Derek Sung, Co-Founder & Managing Partner, Pinnacle Capital Management LLC Beatrice Holloway, Partner, Calderwood & Harkness LLP Andrew Fitzpatrick, Associate, Calderwood & Harkness LLP
Enclosures: None. All work product, draft transaction documents, and diligence materials are maintained in the Firm's matter file (Matter No. 1002-00004) and are available upon request.
Professional | Role | Billing Rate
Harrison Wexford | Partner, Responsible Partner | $1,250/hour
Beatrice Holloway | Partner, Diligence Lead | $1,200/hour
Andrew Fitzpatrick | Senior Associate | $725/hour
Naomi Petersen | Associate | $550/hour

PRIVILEGED & CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION

VIA EMAIL AND FIRST CLASS MAIL

CALDERWOOD & HARKNESS LLP

Record

Parties

Dates

Amounts