Contract analysis

I. Purpose and Context We write on behalf of our client, the Audit Committee of the Board of Directors of Verimark Hospitality Group Inc. ("VHG" or the "Company"), a Delaware corporation whose common stock is publicly traded on the Nasdaq Global Select Market under the ticker symbol VMRK, with principal executive offices located at 4100 Bayshore Boulevard, Suite 1200, Tampa, Florida 33611. As you are aware, VHG is a

II. Background on the Investigation and Triggering Events The events giving rise to the Audit Committee's engagement of Calderwood & Harkness and the subsequent opening of the investigation are as follows: On June 19, 2023, William "Bill" Gentry, CPA, the lead engagement partner at Hargrove, Steen & Aldrich LLP ("HSA"), VHG's independent registered public accounting firm (with offices at 101 East Kennedy Boulevard, S

III. Summary of Preliminary Findings Relevant to Disclosure Determinations While the investigation remains ongoing and our findings are subject to revision as additional evidence is gathered and analyzed, we are in a position to share the following preliminary findings with your firm to the extent necessary to support your analysis of VHG's disclosure obligations and your preparation of the contemplated Form 8-K fili

IV. Item 4.02 Form 8-K — Non-Reliance Disclosure Based on the preliminary findings summarized above, the Audit Committee, in consultation with VHG management — specifically, CEO Margaret "Meg" Calder, CFO Thomas Rhett Griffith, and General Counsel Patricia Navarro — and with the Company's independent auditor, HSA, has concluded that VHG's previously issued financial statements for the following periods should no long

1. Identification of the affected periods. The 8-K should clearly identify the specific financial statements that should no longer be relied upon, including the FY 2022 Annual Report on Form 10-K and the Q1 2023 and Q2 2023 Quarterly Reports on Form 10-Q.

2. Description of the nature of the revenue-recognition issues. The 8-K should include a description, at an appropriate level of generality, of the nature of the revenue-recognition irregularities — specifically, the premature booking of timeshare-interest deposits as completed-sale revenue at VCR properties prior to the expiration of the applicable statutory rescission period — without disclosing specific findings o

3. Reference to the Audit Committee's engagement of independent counsel. The 8-K should note that the Audit Committee has engaged independent outside counsel to conduct an internal investigation into the matters giving rise to the non-reliance determination.

4. Disclosure of HSA's role. The 8-K should disclose that VHG's independent auditor, HSA, identified the potential material weakness in VCR's internal controls over financial reporting during its interim review of Q1 2023 financial statements, and that the Audit Committee has concurred with the non-reliance determination. Consistent with Item 4.02(a), the filing should include the letter from HSA required under Item

5. Authorization of a comprehensive investigation. The 8-K should note that the Audit Committee has authorized a comprehensive investigation into the matters described and that the Company will provide further disclosures as appropriate upon the conclusion of the investigation or as material developments warrant. Calderwood & Harkness will review and provide comments on the draft Form 8-K before filing in order to en

V. Ongoing Disclosure Considerations Beyond the immediate Form 8-K filing, we wish to flag several ongoing disclosure considerations that will require close coordination between our respective firms in the coming weeks and months. Additional Form 8-K Filings. As the investigation progresses, material developments may arise that trigger additional Form 8-K filing obligations. These could include, without limitation: (

VI. Coordination Protocols Between Calderwood & Harkness and Westlake Burris & Holt To ensure the efficient and effective coordination of our respective firms' responsibilities in connection with the investigation and the Company's disclosure obligations, we propose the following protocols: (a) Review of Public Disclosures. All public disclosures by VHG relating to the investigation or its findings — including but no

VII. Privilege Protections We wish to emphasize several important points regarding the preservation of legal privileges in connection with our inter-firm communications and the Company's disclosure obligations. First, Calderwood & Harkness's communications with Westlake Burris & Holt regarding the investigation's findings, methodology, legal analysis, and strategy are protected by the attorney-client privilege, the w

VIII. Requested Next Steps In light of the foregoing, we respectfully request and propose the following next steps:

1. Circulation of Draft Form 8-K. We request that Westlake Burris circulate a draft Form 8-K under Item 4.02 to Calderwood & Harkness for review and comment no later than Saturday, August 12, 2023. This timeline will allow Calderwood & Harkness to review the draft over the weekend and provide consolidated comments by the morning of Monday, August 14, 2023, in time to permit filing on the contemplated filing date. We

2. Joint Coordination Call. We propose scheduling a joint call among the following participants to align on disclosure language, filing timing, and the ongoing coordination protocols described above: • Howard Quinn, Conrad Ashby, and Liam Donahue (Calderwood & Harkness LLP) • Irene Castellanos and relevant members of your team (Westlake Burris & Holt LLP) • Patricia Navarro, General Counsel, VHG • Thomas Rhett Griffi

3. Regulation FD and Nasdaq Listing-Rule Considerations. We request that Westlake Burris advise the Audit Committee and Company management on any immediate Regulation FD or Nasdaq listing-rule considerations arising from the non-reliance determination, including but not limited to: (a) whether the non-reliance determination triggers any disclosure obligations under Nasdaq Listing Rule 5250(c)(1) (material event notif

4. Transfer Agent Notification. We request that Westlake Burris confirm the status of any notice to Continental Registrar & Trust Co. (VHG's transfer agent, with offices at 1700 Broadway, Suite 1400, New York, New York 10019) regarding any anticipated shareholder communications that may be required or advisable in connection with the non-reliance determination. We understand that certain shareholder communications or

IX. Closing We are prepared to discuss any of the matters addressed in this letter at your convenience, and we look forward to working closely with your firm to ensure that VHG meets its disclosure obligations in a timely, accurate, and privilege-protective manner. We recognize that the matters described in this letter are time-sensitive and of the utmost importance to VHG, its shareholders, and the Audit Committee,