Contract analysis

I. PURPOSE AND STRATEGIC OBJECTIVES A. Overview This memorandum sets forth the detailed deposition outline for the cross-examination of Marcus J. Kappel, founder, Chief Executive Officer, and 72% equity member of Triton Harbor Industries, LLC ("Triton Harbor"), a Delaware limited liability company (DE File No. 5217839) with its principal place of business at 47-15 Austell Street, Suite 200, Long Island City, New York

1. Undermine justifiable reliance. The centerpiece of Kappel's fraudulent inducement and negligent misrepresentation counterclaims is the assertion that he justifiably relied upon alleged oral statements by Whitmore regarding BRB's purported willingness to extend a new $6.5 million revolving credit facility. Our primary objective is to establish that Kappel — as a sophisticated 30-year industry veteran who was repres

2. Establish actual knowledge of contractual disclaimers. We must obtain clear, unequivocal admissions that Kappel read, understood, and voluntarily signed the Forbearance Agreement, with particular attention to the "No Commitment to Extend Credit" disclaimer set forth in Section 9(c) and the integration/merger clause set forth in Section 12(a). These admissions are essential to our argument that Kappel's reliance wa

3. Demonstrate independent business judgment. We need to elicit testimony establishing that Kappel's decision to enter the Forbearance Agreement was driven primarily by Triton Harbor's deteriorating financial condition and Kappel's need to avoid the immediate acceleration of approximately $17.575 million in outstanding debt — not by any alleged promise of future credit. If Kappel would have signed the Forbearance Agr

4. Undermine scienter allegations. The fraudulent inducement counterclaim requires proof that BRB's SAG personnel made representations they knew to be false or with reckless disregard for their truth or falsity. We should elicit testimony showing that Kappel understood the function and mandate of a bank's Special Assets Group and the inherently contingent, non-binding nature of any workout discussions that occur in t

5. Lock in testimony. We must pin Kappel to specific factual claims regarding the September 12, 2023 meeting and other alleged misrepresentations, as well as to his account of the circumstances surrounding the execution of the Forbearance Agreement. Narrowing the factual claims at deposition will limit the counterclaim defendants' ability to shift theories at summary judgment and trial. C. Key Admissions Sought The f

II. PRELIMINARY / BACKGROUND EXAMINATION A. Personal Background and Business Experience Begin the examination by establishing Kappel's personal background and extensive business experience. This section serves the dual purpose of building the record of Kappel's sophistication and establishing rapport before moving into more adversarial territory. Use a conversational tone but maintain discipline with closed-ended que

III. THE ORIGINAL CREDIT FACILITY A. Origination and Terms This section establishes the foundation of the lending relationship between BRB and Triton Harbor, confirms Kappel's familiarity with the underlying credit documents, and sets the stage for the financial deterioration that led to the forbearance. Exhibit B-1: Credit Agreement dated June 15, 2021 between Belmont Ridge Bank NA, as lender, and Triton Harbor Indu

IV. FINANCIAL DETERIORATION AND COVENANT DEFAULTS A. Revenue Decline and Contract Losses This section establishes the severity of Triton Harbor's financial deterioration, which is critical to demonstrating that Kappel's primary motivation for signing the Forbearance Agreement was to avoid acceleration and liquidation — not reliance on alleged oral promises of future credit. Establish the following facts regarding Tri

V. RETENTION OF MERCER TIDWELL & ASSOCIATES LLC A. Engagement Exhibit D-1: Mercer Tidwell & Associates LLC engagement letter (produced in discovery). Establish the following facts regarding the retention of a professional restructuring advisory firm: • Triton Harbor retained Mercer Tidwell & Associates LLC ("Mercer Tidwell"), a restructuring advisory firm with offices at 245 Park Avenue, 28th Floor, New York, New Yor

VI. THE SEPTEMBER 12, 2023 MEETING — ALLEGED MISREPRESENTATIONS This section is the heart of the deposition. The September 12, 2023 meeting is the factual predicate for the fraudulent inducement and negligent misrepresentation counterclaims. Our objective is to pin Kappel to the specifics of his account, highlight the qualified and aspirational nature of the alleged statements, and establish that Kappel took no steps

VII. THE SEPTEMBER 18, 2023 REEVES EMAIL A. The Email Exhibit F-1: Email from Joanna Reeves to Marcus Kappel dated September 18, 2023. This email is one of the key documents cited in the counterclaims as evidence of BRB's alleged representations regarding future credit. The email contains the following language: "We are optimistic about a path forward and believe this forbearance sets the stage for a renewed credit r

VIII. THE SEPTEMBER 29, 2023 INTERNAL DRAFT TERM SHEET A. Kappel's Knowledge Exhibit G-1: Email from Joanna Reeves to Derek Whitmore dated September 29, 2023, forwarding a draft term sheet for a potential $6,500,000 revolving credit facility, bearing the notation "for discussion purposes only — not approved." This document is significant because it is an internal BRB communication that was never approved and was neve

IX. THE FORBEARANCE AND MODIFICATION AGREEMENT — EXECUTION AND UNDERSTANDING A. Review and Negotiation of the Forbearance Agreement Exhibit H-1: Forbearance and Modification Agreement dated October 6, 2023, by and between Belmont Ridge Bank NA and Triton Harbor Industries, LLC. Establish the process by which the Forbearance Agreement was reviewed, negotiated, and executed: • Confirm that Kappel received a draft of th

X. THE FORBEARANCE PERIOD — PERFORMANCE AND COMMUNICATIONS A. Performance Under the Forbearance Agreement Establish Triton Harbor's compliance with the material terms of the Forbearance Agreement during the 180-day forbearance period: • Confirm that Triton Harbor made all six monthly debt service payments of $125,000, for a total of $750,000, during the forbearance period (October 2023 through March 2024). • Confirm

XI. ACCELERATION AND POST-FORBEARANCE EVENTS A. Expiration and Acceleration Establish the timeline of events following the expiration of the forbearance: • April 3, 2024: The 180-day forbearance period expired by its own terms, without the covenant-cure milestone having been achieved. • Exhibit J-1: Notice of Default and Acceleration dated April 15, 2024, from BRB to Triton Harbor Industries, LLC and Marcus J. Kappel

XII. THE COUNTERCLAIMS — KAPPEL'S ALLEGATIONS A. Timing and Allegations Exhibit K-1: Answer with Counterclaims filed October 18, 2024. Establish the basic facts regarding the counterclaims: • On October 18, 2024, Kestrel Voss & Huang LLP, acting as counsel for Triton Harbor Industries, LLC, Marcus J. Kappel, and Elaine D. Kappel, filed the Answer with Counterclaims in this action. Lead trial counsel is Theodore "Ted"

XIII. RELIANCE — KEY AREA FOR ADMISSIONS This section synthesizes the themes developed throughout the deposition and focuses directly on the element of justifiable reliance, which is essential to both the fraudulent inducement and negligent misrepresentation counterclaims. A. Sources of Advice and Information Confirm that Kappel had access to the following sources of independent advice and information at the time he