Contract analysis

Section 1.1 — Defined Terms As used in this Treaty, the following terms shall have the meanings set forth below. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the context in which they appear. (a) "Accident Year" means the calendar year in which the loss event giving rise to a claim under the Business Covered occurs. For the avoidance of doubt, the Accident Year is determin

Section 1.2 — Rules of Interpretation (a) Unless the context otherwise requires, words importing the singular include the plural and vice versa, words importing a gender include each gender, and references to persons include individuals, partnerships, corporations, limited liability companies, and other entities. (b) References herein to "Articles," "Sections," "Schedules," and "Exhibits" are to Articles and Sections

Section 2.1 — Treaty Period This Treaty shall apply to the Business Covered attaching during the Treaty Period, which shall commence at 12:01 a.m. Eastern Time on January 1, 2026 and shall expire at 12:01 a.m. Eastern Time on December 31, 2026. This Treaty is written on a losses-occurring basis, meaning that the Reinsurer shall be liable for its Quota Share Percentage of all Losses on the Business Covered that occur

Section 2.2 — Run-Off and Cut-Off Upon the expiration or termination of this Treaty, the Parties shall elect one of the following options with respect to policies comprising the Business Covered that remain in force as of the Expiration Date or the date of termination, as applicable: (a) Run-Off. The Reinsurer shall remain liable for its Quota Share Percentage of all Losses occurring under policies that were in force

Section 2.3 — Renewal [This Treaty shall [not automatically renew / automatically renew for successive one-year periods unless either Party provides written notice of non-renewal to the other Party at least [90/120] days prior to the then-current Expiration Date]. In the event of automatic renewal, the terms and conditions of this Treaty shall continue in full force and effect for each successive renewal period, subj

ARTICLE III — BUSINESS COVERED

Section 3.1 — Subject Premium This Treaty applies to all property lines of business written by the Company through its property book, as more particularly described in Schedule A attached hereto and made a part hereof. For reference purposes, the Company's historical and projected premium volumes for the property book are as follows: (a) 2024 Gross Written Premium (Property Book): $312,000,000 (actual). (b) 2025 Gros

Section 3.2 — Classes of Business The Business Covered under this Treaty shall comprise the following classes of business written by the Company: (a) Commercial property insurance (including business interruption and extra expense coverages); (b) Inland marine insurance; (c) Ocean marine insurance (property coverages only, excluding hull, protection and indemnity, and marine liability); (d) Fintech-enabled commercial

Section 3.3 — Territorial Scope The Business Covered under this Treaty shall be limited to risks located within the United States of America (including all fifty states and the District of Columbia), its territories and possessions (including but not limited to Puerto Rico, the U.S. Virgin Islands, Guam, and American Samoa), and Canada, as more particularly described in Schedule A. Risks located outside the foregoing

Section 3.4 — New Lines of Business The Company shall provide the Reinsurer [30/60] days' prior written notice before ceding under this Treaty any new class of business that has not been previously included in the Business Covered as described in Section 3.2 and Schedule A. The inclusion of any such new class of business shall require the prior written consent of the Reinsurer, which consent shall not be unreasonably

ARTICLE IV — CESSION AND RETENTION

Section 4.1 — Quota Share Percentage The Company shall cede to the Reinsurer, and the Reinsurer shall accept from the Company, forty percent (40%) (the "Quota Share Percentage" or "Cession Percentage") of the Net Written Premium and forty percent (40%) of the Losses on the Business Covered during the Treaty Period. The application of the Quota Share Percentage shall be automatic and obligatory on both Parties for all

Section 4.2 — Maximum Per-Occurrence Limit Notwithstanding anything to the contrary in this Treaty, the Reinsurer's maximum aggregate liability in respect of any one occurrence shall not exceed ten million dollars ($10,000,000), which represents the Reinsurer's forty percent (40%) Quota Share Percentage of a maximum per-occurrence limit of twenty-five million dollars ($25,000,000) applicable to the Company's gross li

Section 4.3 — Per-Risk Retention The Company shall retain a minimum of two million five hundred thousand dollars ($2,500,000) per risk (the "Per-Risk Retention"), net of all recoveries under this Treaty. Cessions to this Treaty with respect to any individual risk shall be calculated after the application of the Per-Risk Retention. For purposes of this Section 4.3, the term "risk" shall have the meaning customarily as

Section 4.4 — Other Reinsurance (a) The following reinsurance arrangements shall be considered in determining the Net Written Premium ceded under this Treaty and the application of the Quota Share Percentage: (i) Catastrophe Excess-of-Loss Reinsurance. The Catastrophe Excess-of-Loss Reinsurance Contract effective January 1, 2026, providing coverage of $35,000,000 excess of $15,000,000 per occurrence (the "Cat XOL Lay

Section 5.1 — Provisional Ceding Commission The Reinsurer shall pay the Company a provisional ceding commission equal to thirty-three and one-half percent (33.5%) of the Ceded Premium (the "Provisional Ceding Commission"). The Provisional Ceding Commission of 33.5% represents an increase of one hundred fifty (150) basis points from the expiring provisional ceding commission of thirty-two percent (32.0%) applicable to

Section 5.2 — Sliding Scale Commission The Provisional Ceding Commission of 33.5% shall be subject to adjustment on a sliding scale basis, calculated in accordance with this Section 5.2 and the detailed slide table set forth in Schedule C attached hereto. The sliding scale parameters are as follows: (a) Minimum Ceding Commission: Thirty percent (30.0%) of Ceded Premium. (b) Maximum Ceding Commission: Thirty-six perce

Section 5.3 — Commission Adjustment Mechanics (a) If the sliding scale calculation performed in accordance with Section 5.2 and Schedule C produces a ceding commission that is greater than the Provisional Ceding Commission of 33.5%, the Reinsurer shall pay the difference (the "Commission Surplus") to the Company within [30/45] days of the date on which the adjustment calculation is completed and agreed upon by the Pa

Section 5.4 — Loss Corridor Notwithstanding Section 4.1, the Company shall retain one hundred percent (100%) of all Losses falling within the Loss Ratio band between seventy-five percent (75%) and eighty percent (80%) (the "Loss Corridor"). The Loss Corridor operates as follows: (a) Losses ceded to the Reinsurer at the Quota Share Percentage of forty percent (40%) shall include only those Losses that fall below the s

ARTICLE VI — PREMIUM ACCOUNTING AND REPORTING

Section 6.1 — Premium Payments The Company shall remit to the Reinsurer (through the Intermediary) the Ceded Premium, net of the following deductions: (i) the Provisional Ceding Commission; (ii) the Funds Withheld amount; and (iii) the brokerage commission payable to the Intermediary as described in Section 6.3. Premium payments shall be made on a quarterly basis, corresponding to each calendar quarter during the Tre

Section 6.2 — Premium Adjustments (a) Quarterly premium accounts shall be rendered by the Company to the Reinsurer (through the Intermediary) within [45/60] days after the close of each calendar quarter. Each quarterly premium account shall reflect the Gross Written Premium, Net Written Premium, Ceded Premium, Provisional Ceding Commission, brokerage, Funds Withheld, and net remittance for the applicable quarter, sub

Section 6.3 — Brokerage The brokerage commission payable to the Intermediary (Blackbridge Advisory Group LLC) shall be one and one-quarter percent (1.25%) of the Ceded Premium. The brokerage commission shall be deducted from the Ceded Premium remitted to the Reinsurer and paid to the Intermediary by the Company on behalf of the Reinsurer. The brokerage commission is the sole obligation of the Reinsurer and shall not

Section 7.1 — Funds Withheld Amount The Company shall withhold twenty-five percent (25%) of the Ceded Premium as security for the Reinsurer's obligations under this Treaty (the "Funds Withheld"). The Funds Withheld shall be credited to a Funds Withheld Account maintained on the Company's books and records. The Funds Withheld Account shall be a notional account and shall not constitute a segregated trust or escrow. Th

Section 7.2 — Interest on Funds Withheld The Company shall credit interest on the Funds Withheld balance at a rate equal to the three-month SOFR rate plus seventy-five (75) basis points per annum. Interest shall be calculated on the average daily balance of the Funds Withheld Account for each calendar quarter and shall be credited to the Funds Withheld Account quarterly, within thirty (30) days after the close of eac

Section 7.3 — Release of Funds Withheld Funds Withheld shall be released to the Reinsurer on a [quarterly / annual] basis to the extent that the balance of the Funds Withheld Account exceeds twenty-five percent (25%) of the then-outstanding Ceded Premium, net of paid Losses and Ceding Commission, as of the applicable measurement date. The measurement of the Funds Withheld balance and the determination of any release

Section 7.4 — Set-Off The Company shall have the right to set off against the Funds Withheld Account any amounts due and owing from the Reinsurer to the Company under this Treaty, including but not limited to: (a) unpaid ceding commission adjustments; (b) Loss payments due from the Reinsurer; (c) any amounts due under the sliding scale commission adjustment; and (d) any other amounts owed by the Reinsurer to the Comp

ARTICLE VIII — LOSSES AND LOSS ADJUSTMENT EXPENSES

Section 8.1 — Liability of the Reinsurer The Reinsurer shall pay its Quota Share Percentage (40%) of all Losses on the Business Covered during the Treaty Period, subject to: (a) the maximum per-occurrence limit of twenty-five million dollars ($25,000,000) (Reinsurer's share: ten million dollars ($10,000,000)) as set forth in Section 4.2; (b) the Loss Corridor provisions of Section 5.4; and (c) all other terms, condit

Section 8.2 — Loss Settlements The Company shall have the sole and exclusive authority to investigate, adjust, compromise, settle, and pay all claims arising under the policies comprising the Business Covered, in accordance with the Company's standard claims handling practices and applicable regulatory requirements. All loss settlements made by the Company in good faith and within the terms and conditions of the unde

Section 8.3 — Cash Loss / Large Loss Notification The Company shall notify the Reinsurer (through the Intermediary) within [5/10] business days of the Company's receipt of notice of any individual loss or claim where the Company's gross estimated liability exceeds [$1,000,000 / $2,000,000]. Such notification shall include the date of loss, a brief description of the circumstances of the loss, the insured's name and p

Section 8.4 — Loss Reserves The Company shall establish and maintain loss reserves with respect to the Business Covered in accordance with (a) the Company's standard reserving practices and methodologies, (b) applicable statutory accounting principles as promulgated by the NAIC, and (c) all applicable requirements of the Connecticut Insurance Department and any other regulatory authority having jurisdiction over the

Section 9.1 — Commutation Right Either Party shall have the right to elect to commute this Treaty if the Cash Loss Ratio, as defined in Section 1.1(d), equals or exceeds eighty-five percent (85%) on an inception-to-date basis, calculated from the inception of the Original Treaty on January 1, 2022 through the most recent calendar quarter end for which a quarterly bordereau has been provided. The Cash Loss Ratio shall

Section 9.2 — Commutation Mechanics Upon the delivery and receipt of a Commutation Notice, the Parties shall negotiate in good faith to agree upon a commutation payment (the "Commutation Amount") that fully and finally settles all of the Reinsurer's outstanding and prospective obligations under this Treaty (and, to the extent applicable, the Original Treaty and all predecessor treaty years). The Commutation Amount sh

Section 9.3 — Effect of Commutation Upon payment of the agreed Commutation Amount by the Reinsurer to the Company (or, as applicable, by the Company to the Reinsurer if the Commutation Amount reflects a net credit to the Reinsurer), the Reinsurer shall be fully, finally, and irrevocably released and discharged from all further obligations and liabilities under this Treaty, including, if applicable, all obligations an

ARTICLE X — REPORTING AND ACCOUNTS

Section 10.1 — Quarterly Bordereaux The Company shall provide the Reinsurer (through the Intermediary) with quarterly premium and loss bordereaux within [45/60] days after the close of each calendar quarter during the Treaty Period and during any run-off period following expiration or termination. The first quarterly bordereau under this Treaty shall be due no later than March 31, 2026 (covering the period from Janua

Section 10.2 — Content of Bordereaux (a) Premium Bordereau. Each quarterly premium bordereau shall contain the following information for each policy ceded under this Treaty during the applicable quarter: policy number, named insured, state or territory, class of business, policy effective date, policy expiration date, gross written premium, net written premium, ceded premium (at 40%), and the ceding commission amount

Section 10.3 — Annual Report The Company shall provide the Reinsurer with an annual report within ninety (90) days after December 31 of each Treaty Year. The annual report shall include a summary of the following for the applicable Treaty Year: written premium (gross and ceded), earned premium (gross and ceded), incurred losses (paid and outstanding, gross and ceded), Loss Ratio, ceding commission (provisional and ad

Section 10.4 — Audit Rights The Reinsurer shall have the right, upon [30/60] days' prior written notice to the Company, to inspect and audit the books, records, documents, and accounts of the Company relating to this Treaty, including but not limited to underwriting files, policy files, claims files, premium records, loss records, reserve analyses, actuarial reports, and financial statements. Such audits shall be con

ARTICLE XI — ERRORS AND OMISSIONS

Section 11.1. Inadvertent delays, errors, or omissions made by either Party in connection with the reporting, cession, premium accounting, loss reporting, or administration of this Treaty shall not relieve either Party of any liability that would otherwise attach under this Treaty, provided that such delays, errors, or omissions are corrected promptly upon discovery by the Party responsible therefor. Upon discovery o

Section 12.1 — Insolvency Clause In the event of the insolvency of the Company, all reinsurance payable by the Reinsurer under this Treaty shall be payable directly to the Company or to its liquidator, receiver, conservator, or statutory successor, on the basis of the liability of the Company under the policies reinsured, without diminution because of the insolvency of the Company or because the liquidator, receiver,

Section 13.1. Each Party shall have the right to offset any balance or balances, whether on account of premiums, commissions, losses, loss adjustment expenses, salvage, subrogation, or otherwise, due from one Party to the other under this Treaty. Such right of offset shall apply to all debts and credits arising under this Treaty, whether or not they arise under the same Treaty Year. [Mutual debts arising under other

Section 14.1 — Appointment of Intermediary Blackbridge Advisory Group LLC (NY DFS License No. RI-00483), with offices at 55 Water Street, Suite 1410, New York, New York 10041, is hereby recognized as the Intermediary through which this Treaty has been placed and effected. The managing director responsible for the placement and servicing of this Treaty on behalf of the Intermediary is Owen F. Halstead. The appointment

Section 14.2 — Intermediary Functions (a) All communications, notices, premium remittances, loss settlements, and other transactions between the Company and the Reinsurer in connection with this Treaty shall be transmitted through the Intermediary, unless otherwise agreed in writing by the Parties. (b) Premium Payments. The Intermediary shall be deemed the agent of the Reinsurer for purposes of receiving premium paym

Section 14.3 — Brokerage The Intermediary shall be entitled to a brokerage commission of one and one-quarter percent (1.25%) of the Ceded Premium, payable from the Reinsurer's share of the Ceded Premium. The brokerage commission shall be deducted by the Company from the Ceded Premium and remitted to the Intermediary on behalf of the Reinsurer on a quarterly basis, contemporaneously with the premium remittance. The br

Section 15.1 — Agreement to Arbitrate Any dispute, controversy, or claim arising out of or relating to this Treaty, including but not limited to disputes regarding its formation, validity, interpretation, performance, breach, or termination, and including any dispute regarding the Commutation Amount under Article IX, shall be submitted to and resolved by binding arbitration in accordance with the then-current rules a

Section 15.2 — Arbitration Panel The arbitration shall be conducted before a panel of three (3) arbitrators, each of whom shall be a current or former officer of an insurance or reinsurance company, or a current or former underwriter at Sundial Indemnity Co., with not less than ten (10) years of experience in the property and casualty insurance or reinsurance industry. Each Party shall appoint one arbitrator within t

Section 15.3 — Seat of Arbitration The seat of arbitration shall be New York, New York. All hearings shall be held in New York, New York, unless the Parties otherwise agree in writing.

Section 15.4 — Arbitration Standards The arbitrators shall consider the custom and practice of the insurance and reinsurance industry in interpreting and applying the provisions of this Treaty. The arbitrators shall interpret this Treaty as an honorable engagement between the Parties and shall not be bound by strict rules of law or evidence. Notwithstanding the foregoing, the arbitrators shall apply the substantive l