Contract analysis

Section 1.1 — Defined Terms As used in this Contract, the following terms shall have the meanings set forth below. Capitalized terms used in this Contract and not otherwise defined herein shall have the meanings ascribed to them in the context in which they are used. "Attachment Point" means Fifteen Million Dollars ($15,000,000) per Occurrence, net of quota-share recoveries and any other inuring reinsurance. "Busines

Section 1.2 — Rules of Construction In this Contract, unless the context otherwise requires: (a) Headings and titles of articles, sections, schedules, and exhibits are inserted for convenience of reference only and shall not affect the interpretation or construction of any provision of this Contract. (b) The words "include," "includes," and "including" shall be deemed to be followed by the phrase "without limitation.

Section 2.1 — Treaty Period This Contract shall be effective from 12:01 a.m. Eastern Time on January 1, 2026 through 12:01 a.m. Eastern Time on January 1, 2027 (the "Treaty Period"). The Treaty Period shall constitute a twelve (12) month term, during which the reinsurance provided hereunder shall be in effect in accordance with the terms and conditions set forth herein. All times referenced in this Contract shall be

Section 2.2 — Policies Covered This Contract covers all policies of the Company constituting Business Covered that are in force at the inception of the Treaty Period, and all policies constituting Business Covered that are issued or renewed by the Company during the Treaty Period. This Contract is written on a "Losses Occurring During" basis, meaning that this Contract covers Occurrences taking place during the Treat

Section 2.3 — Run-off / Sunset Upon the expiration or termination of the Treaty Period, this Contract shall continue in effect with respect to all outstanding claims arising from Occurrences that took place during the Treaty Period, until such claims are finally settled, commuted, or otherwise resolved. The Reinsurers' obligations with respect to such Occurrences shall survive the expiration or termination of the Tre

Section 3.1 — Indemnity and Layer Structure Subject to all of the terms and conditions of this Contract, the Company agrees to cede, and each Reinsurer agrees to accept (severally and not jointly, in accordance with each Reinsurer's Percentage Share as set forth in Schedule A), its respective share of the amount by which the Company's Ultimate Net Loss arising from any one Occurrence exceeds the Attachment Point of F

Section 3.2 — Net Retained Lines The Company's retention of Fifteen Million Dollars ($15,000,000) per Occurrence represents the Company's net retention after giving effect to the Company's 40% property quota-share reinsurance treaty with Pinnacle Re Ltd. and any other inuring reinsurance that reduces the Company's net loss from any Occurrence before application of this Contract. The Company warrants that it shall ret

Section 3.3 — Definition of Occurrence / Hours Clause For purposes of this Contract, an "Occurrence" means any one loss, disaster, casualty, or catastrophe, or any series of losses, disasters, casualties, or catastrophes arising out of one event or from one common cause or from one catastrophe. All individual losses arising from an Occurrence shall be treated as a single Occurrence for purposes of determining whether

Section 3.4 — Territory This Contract applies only to losses originating from risks physically located within the Territory, as defined in Section 1.1 and further described in Schedule B. The Territory encompasses the Continental United States (including all fifty states and the District of Columbia), Hawaii, Puerto Rico, and the United States Virgin Islands. Losses arising from risks located outside the Territory ar

Section 3.5 — Perils Covered This Contract provides coverage on an "all natural perils" basis. The natural perils covered hereunder include, without limitation, the following: (a) Named storm and hurricane (including tropical storms, typhoons, and related storm surge and precipitation); (b) Earthquake (including seismic activity, aftershock, tsunami, and related ground movement); (c) Flood (whether or not resulting f

Section 3.6 — Ultimate Net Loss "Ultimate Net Loss" means the sum actually paid or payable by the Company in settlement of losses and/or liabilities arising from a covered Occurrence, after deduction of all recoveries (whether collected or not), salvage, subrogation, and all other reductions in loss actually obtained, including, without limitation: (a) All allocated loss adjustment expenses ("ALAE"), including court

Section 4.1 — Nuclear Exclusion (NMA 1975a) This Contract shall not apply to nor cover any loss or liability directly or indirectly arising from, contributed to by, or resulting from nuclear reaction, nuclear radiation, or radioactive contamination, regardless of any other cause or event contributing concurrently or in any other sequence to the loss. The Nuclear Incident Exclusion Clause — Liability — Reinsurance (NM

Section 4.2 — Communicable Disease Exclusion (NMA 2962) This Contract shall not apply to nor cover any loss, damage, cost, or expense directly or indirectly arising out of, contributed to by, or resulting from any communicable disease, or the fear or threat (whether actual or perceived) of a communicable disease. The Communicable Disease Exclusion (NMA 2962) is hereby incorporated by reference and attached hereto in

Section 4.3 — Terrorism Exclusion (LMA 3030, Modified) This Contract shall not apply to nor cover any loss, damage, cost, or expense of whatsoever nature directly or indirectly caused by, resulting from, or in connection with any act of terrorism, as defined herein, regardless of any other cause or event contributing concurrently or in any other sequence to the loss. The Terrorism Exclusion (LMA 3030, as modified) is

Section 4.4 — Cyber Exclusion (LMA 5400, Modified per Quorum Manuscript) This Contract shall not apply to nor cover any loss, damage, liability, claim, cost, or expense of whatsoever nature directly or indirectly caused by, contributed to by, resulting from, arising out of, or in connection with any cyber act or any cyber incident. The Cyber Act Exclusion (LMA 5400, as modified per the Quorum Manuscript) is hereby in

Section 4.5 — Other Exclusions In addition to the exclusions set forth in Sections 4.1 through 4.4, this Contract shall not apply to nor cover any loss, damage, cost, expense, or liability directly or indirectly arising from, contributed to by, or resulting from any of the following: (a) War and Civil War. Any war, invasion, act of foreign enemy, hostilities (whether war be declared or not), civil war, rebellion, rev

Section 5.1 — Annual Layer Premium The Annual Layer Premium payable by the Company to the Reinsurers for the reinsurance coverage provided under this Contract shall be Two Million Nine Hundred Seventy-Five Thousand Dollars ($2,975,000), calculated as the product of the Layer Limit of Thirty-Five Million Dollars ($35,000,000) multiplied by the Rate-on-Line of eight and one-half percent (8.50%). Each Reinsurer's share

Section 5.2 — Minimum Premium The Minimum Premium under this Contract shall be Two Million Three Hundred Eighty Thousand Dollars ($2,380,000), representing eighty percent (80%) of the Annual Layer Premium. The Minimum Premium shall be fully earned as of the Effective Date and shall be non-refundable under any circumstances, including early termination of this Contract (except for termination resulting from a material

Section 5.3 — Deposit Premium and Payment Schedule The Annual Layer Premium shall be paid in four (4) equal quarterly installments of Seven Hundred Forty-Three Thousand Seven Hundred Fifty Dollars ($743,750) each. Each installment shall be payable on the following due dates: (a) First Installment: January 1, 2026, or within thirty (30) days of the Effective Date (i.e., no later than January 31, 2026); (b) Second Inst

Section 5.4 — Adjustment Premium [The Parties shall discuss whether the Annual Layer Premium is structured on a flat-rated basis (as currently contemplated in this draft) or whether a variable-rated structure shall apply, under which the final Annual Layer Premium would be subject to adjustment based on changes in the Company's subject premium base during the Treaty Period. If a variable-rated structure is adopted, t

Section 5.5 — Late Payment / Interest Any premium installment not received by the applicable Reinsurer (or by the Intermediary on behalf of such Reinsurer) within the applicable payment period shall bear interest at a rate equal to the Prime Rate as published by The Wall Street Journal on the applicable due date, plus two percent (2%) per annum, calculated from the due date to the date of actual receipt. For purposes

Section 6.1 — Number of Reinstatements The Layer Limit shall be subject to one (1) reinstatement of the full Layer Limit of Thirty-Five Million Dollars ($35,000,000). Accordingly, following the exhaustion or partial exhaustion of the original Layer Limit by reason of a loss Occurrence during the Treaty Period, the Layer Limit shall be automatically reinstated to its original amount (or the portion thereof that has be

Section 6.2 — Reinstatement Premium The reinstatement of the Layer Limit (or any portion thereof) shall be subject to the payment by the Company of a Reinstatement Premium calculated at one hundred percent (100%) of the original Annual Layer Premium applicable to the reinstated amount, pro rata as to time for the balance of the Treaty Period remaining from the date of the loss Occurrence giving rise to the reinstatem

Section 6.3 — Maximum Aggregate Exposure The total aggregate exposure of all Reinsurers under this Contract (being the original Layer Limit plus one reinstatement of the Layer Limit) shall not exceed Seventy Million Dollars ($70,000,000). In no event shall the aggregate of all recoveries by the Company under this Contract, across all Occurrences during the Treaty Period, exceed Seventy Million Dollars ($70,000,000).

Section 6.4 — Reinstatement Mechanics The reinstatement of the Layer Limit following the attachment of a loss Occurrence to the Layer is automatic and immediate, requiring no additional documentation, endorsement, or confirmation by any Party. Coverage under the reinstated Layer Limit shall be effective immediately following the Occurrence that exhausted or partially exhausted the original Layer Limit. The Reinstatem

ARTICLE VII — LOSS SETTLEMENT AND CLAIMS

Section 7.1 — Loss Notices The Company shall provide prompt written notice to the Lead Reinsurer (Pinnacle Re Ltd.) and to the Intermediary (Blackbridge Advisory Group LLC) of any Occurrence that the Company reasonably believes may give rise to a claim or recovery under this Contract. Such preliminary loss notice shall be provided within ten (10) business days of the date on which the Company first determines, based

Section 7.2 — Loss Adjustment The Company shall investigate, adjust, defend, and settle all claims and losses arising from covered Occurrences in accordance with the Company's standard claims-handling practices and procedures. The Company shall exercise its professional judgment in the investigation, adjustment, and settlement of claims, and shall act in good faith and in a commercially reasonable manner consistent w

Section 7.3 — Cash Call / Interim Funding In the event of a catastrophe loss that the Company reasonably expects will result in a claim under this Contract, the Company may make a cash call upon each Reinsurer for its Percentage Share of the estimated Ultimate Net Loss in excess of the Attachment Point. Each cash call shall be accompanied by reasonable supporting documentation, including the preliminary loss notice,

Section 7.4 — Subrogation, Salvage, and Recoveries All subrogation, salvage, and other recoveries (including recoveries from inuring reinsurance, other third parties, or any other source) attributable to a covered Occurrence shall be applied to reduce the Ultimate Net Loss for such Occurrence. The Reinsurers shall share in all such recoveries in proportion to their respective shares of paid losses under this Contract

Section 7.5 — Extra-Contractual Obligations and Excess of Policy Limits [The inclusion, scope, and terms of coverage for Extra-Contractual Obligations (ECO) and Excess of Policy Limits (XPL) losses are subject to negotiation between the Parties. The following open points remain to be resolved:] [(a) Whether ECO and XPL losses shall be covered under this Contract;] [(b) If covered, whether ECO and XPL losses shall be

ARTICLE VIII — REPORTS AND ACCOUNTS

Section 8.1 — Quarterly Reports The Company shall submit to the Lead Reinsurer and each participating Reinsurer (or through the Intermediary) quarterly reports within forty-five (45) days following the end of each calendar quarter during the Treaty Period (and during any run-off period during which claims from Occurrences within the Treaty Period remain outstanding). Each quarterly report shall be substantially in th

Section 8.2 — Annual Report The Company shall submit to the Lead Reinsurer and each participating Reinsurer (or through the Intermediary) an annual report within ninety (90) days following the end of the Treaty Period. The annual report shall provide a comprehensive reconciliation of all financial obligations under this Contract, including: (a) Final premium accounting, including any adjustment premiums (if applicabl

Section 8.3 — Commutation and Final Settlement Unless the Parties agree to commute the outstanding obligations under this Contract at an earlier date pursuant to Section 18.2, the final accounting and settlement of all obligations under this Contract shall be completed no later than thirty-six (36) months following the expiration of the Treaty Period (i.e., no later than December 31, 2029), or such later date as the

Section 8.4 — Access to Records Each Reinsurer (or its duly authorized representative, including its auditors, actuaries, and legal counsel) shall have the right, upon not less than thirty (30) days' prior written notice and during normal business hours, to inspect, examine, audit, and copy the books, records, documents, and accounts of the Company that relate to this Contract, including underlying policy files, clai

ARTICLE IX — COLLATERAL AND SECURITY

Section 9.1 — Certified Reinsurer — Pinnacle Re Ltd. Pinnacle Re Ltd. is a certified reinsurer recognized by the New York State Department of Financial Services ("NYDFS") under NYDFS Certified Reinsurer ID: CR-2019-0217. As a certified reinsurer with a Secure-1 rating (or equivalent) assigned by NYDFS, Pinnacle Re Ltd. is exempt from the collateral requirements that would otherwise be applicable to an unauthorized or

Section 9.2 — Collateral Trust — Graystone Reinsurance AG Graystone Reinsurance AG is neither domiciled in the United States nor certified as a reinsurer by NYDFS. Accordingly, in order for the Company to take credit for reinsurance ceded to Graystone Reinsurance AG under this Contract for statutory financial statement purposes, Graystone Reinsurance AG shall establish and maintain a multi-beneficiary reinsurance tru

Section 9.3 — Collateral Trust — Tidewater Re S.A. Tidewater Re S.A. is neither domiciled in the United States nor certified as a reinsurer by NYDFS. Accordingly, in order for the Company to take credit for reinsurance ceded to Tidewater Re S.A. under this Contract for statutory financial statement purposes, Tidewater Re S.A. shall establish and maintain a multi-beneficiary reinsurance trust (the "Tidewater Trust") i

Section 9.4 — Condition Precedent The establishment and funding of the Graystone Trust in the amount required by Section 9.2, and the Tidewater Trust in the amount required by Section 9.3, in each case no later than December 15, 2025, is a condition precedent to the effectiveness of this Contract with respect to the applicable Reinsurer's participation. If either the Graystone Trust or the Tidewater Trust is not esta

Section 9.5 — Ongoing Maintenance and Adjustments Each of the Graystone Trust and the Tidewater Trust shall be maintained at the required funding level (as specified in Sections 9.2 and 9.3, respectively) throughout the Treaty Period and during any run-off period during which obligations of the applicable Reinsurer remain outstanding under this Contract. If, at any time during the Treaty Period or any run-off period,

ARTICLE X — SEVERAL LIABILITY; REINSURER DEFAULT

Section 10.1 — Several (Not Joint) Liability The liability of each Reinsurer under this Contract is several and