Contract analysis

I. Introduction and Purpose This firm represents Quorum Insurance Holdings Corp. ("Quorum") in connection with the negotiation of the proposed five-year Master Data License Agreement (the "MDLA") with Meridian Credit intelligence, Inc. ("Meridian"). We write to formally communicate Quorum's significant and growing concern regarding the continued impasse on two critical open issues in the MDLA negotiations: (a) the mo

II. The Most Favored Nation Pricing Impasse A. Quorum's Position on MFN Pricing Throughout the negotiation of the MDLA, Quorum has consistently requested the inclusion of a most favored nation pricing provision. The core objective of the MFN Provision is straightforward: if, at any time during the term of the MDLA, Meridian offers any other insurance-industry licensee within the defined comparator group more favorabl

III. The Derived-Data Rights Impasse A. Quorum's Position on Derived Data The second critical open issue in the MDLA negotiation concerns the ownership and commercialization of Derived Data. Quorum's position, which has been consistent since the outset of these negotiations, is as follows: Quorum should own all intellectual property rights in any data, models, scores, indices, or analytics outputs created by Quorum u

1. Perpetual, Royalty-Free License-Back. Meridian has demanded a perpetual, irrevocable, royalty-free license-back on all Derived Data, granting Meridian the right to use Derived Data for Meridian's own internal and external purposes without restriction. Quorum objects strenuously to this demand. Granting Meridian a perpetual, royalty-free right to use Derived Data that incorporates Quorum's proprietary models, algor

3. Fifteen Percent Revenue Share. Meridian has demanded a revenue-sharing arrangement under which Meridian would receive fifteen percent (15%) of net revenues attributable to Quorum's third-party commercialization of any Derived Data that Meridian deems to have been "sufficiently transformed" and therefore approved for external distribution. Quorum objects to this demand. A fifteen percent revenue share on Quorum's d

IV. Impact of Continued Impasse on Transaction Timeline We wish to draw your attention to the significant impact that the continued impasse on these two issues is having on the transaction timeline and on Quorum's business. The MDLA negotiation has now been ongoing for approximately eight months since Meridian's initial term sheet was delivered on September 12, 2022, and for over five months since the parties first e

V. Escalation Notice In light of the foregoing, we wish to advise you that if the parties are unable to make meaningful progress toward resolving the MFN and derived-data issues within the coming weeks, Quorum intends to escalate the matter to the C-suite level for direct principal-to-principal engagement. Specifically, Margaret "Meg" Tierney, Quorum's Chief Executive Officer, is prepared to engage directly with Vinc

VI. Reservation of Rights and Continued Good Faith Notwithstanding the concerns expressed herein, Quorum remains fully committed to completing the MDLA and values the commercial relationship with Meridian. The data products that Meridian has developed are of significant quality and relevance to Quorum's business, and Quorum believes that a completed MDLA would be mutually beneficial for both parties. We wish to empha

VII. Request for Response Quorum respectfully requests that Meridian provide a substantive written response to this letter within fifteen (15) business days of the date hereof (i.e., on or before May 16, 2023). We ask that Meridian's response address both the MFN Provision and the Derived-Data Provisions and identify, with specificity, any areas in which Meridian's position may have evolved or in which Meridian is pr