CALDERWOOD & HARKNESS LLP Attorneys at Law
Miami Office 333 SE 2nd Avenue, Suite 4400 Miami, FL 33131 Telephone: (305) 884-7200 Facsimile: (305) 884-7201 www.calderwoodharkness.com
December 20, 2023
Via Email and First Class Mail
Gregory Stanton, Esq. Fendowell Rourke & Stanton LLP 280 Trumbull Street, Suite 2200 Hartford, CT 06103
Re: Settlement Payment Instructions — *Verimark Hospitality Group Inc. v. Ironclad Indemnity Corp. et al.*, Case No. 2022-CA-031547 (Eleventh Judicial Circuit of Florida, Miami-Dade County); Settlement Agreement and Mutual Release executed December 19, 2023
Dear Mr. Stanton:
This firm represents Verimark Hospitality Group Inc. ("VHG") in connection with the above-referenced matter. I write in connection with the Settlement Agreement and Mutual Release fully executed by all parties on December 19, 2023 (the "Settlement Agreement"), to provide wire transfer instructions for the settlement payments due from your clients, Ironclad Indemnity Corporation ("Ironclad") and Pinnacle Surplus Lines Inc. ("Pinnacle"). We understand that Fendowell Rourke & Stanton LLP serves as counsel of record to both Ironclad and Pinnacle in this action pursuant to a joint defense arrangement, and accordingly we are directing this single communication to your attention on behalf of both paying entities.
Please note that this letter is being transmitted via both email and U.S. First Class Mail to ensure receipt and to maintain a physical record of the wire transfer instructions contained herein, consistent with best practices for the transmission of sensitive financial information.
Settlement Payment Amounts
Pursuant to Section 3.1 and Exhibit A (Payment Allocation Schedule) of the Settlement Agreement, the following settlement payments are due from your respective clients:
Ironclad Indemnity Corporation: $24,500,000.00 (Twenty-Four Million Five Hundred Thousand and 00/100 Dollars)
Pinnacle Surplus Lines Inc.: $12,200,000.00 (Twelve Million Two Hundred Thousand and 00/100 Dollars)
The combined total due from your clients is $36,700,000.00 (Thirty-Six Million Seven Hundred Thousand and 00/100 Dollars). As you are aware, these amounts represent Ironclad's and Pinnacle's respective allocated shares of the aggregate settlement amount of $47,300,000.00, as set forth in the Payment Allocation Schedule attached to the Settlement Agreement as Exhibit A. The remaining $10,600,000.00 is attributable to the other settling defendants and is being addressed separately, as noted below.
Payment Deadline
Pursuant to Section 4.2 of the Settlement Agreement, all settlement payments are due and payable within forty-five (45) calendar days following the date of full execution of the Settlement Agreement. Because the Settlement Agreement was fully executed on December 19, 2023, the payment deadline falls on Friday, February 2, 2024.
We respectfully request that your clients initiate their respective wire transfers as promptly as practicable and well in advance of the February 2, 2024 deadline. As you appreciate, federal wire transfers may require one to two business days for processing, clearance, and confirmation of receipt in our trust account, and we wish to ensure that all funds are confirmed as received before the contractual deadline. Early remittance will also allow us to promptly issue formal receipts and acknowledgments to all parties, which will facilitate the timely filing of the joint stipulation of dismissal discussed below.
Wire Transfer Instructions
All settlement payments should be made by federal wire transfer to Calderwood & Harkness LLP's Interest on Lawyers' Trust Account (IOLTA) maintained in accordance with the Rules Regulating The Florida Bar. The wire transfer instructions are as follows:
Receiving Bank: Atlantic National Trust Bank
Bank Address: 140 Broadway, 22nd Floor, New York, NY 10005
ABA/Routing Number: 021-084-731
Account Name: Calderwood & Harkness LLP Attorney Trust Account
Account Number: 8840-2261-7793
SWIFT Code: ANTBUS33 (for use in connection with international or cross-border wire transfers, if applicable)
Reference Line / Memo: Each wire should include the following reference information:
"VHG v. Ironclad et al. — Settlement — [Name of Paying Entity]" Case No. 2022-CA-031547
We request that separate wire transfers be initiated for each of your two clients — that is, one wire in the amount of $24,500,000.00 from Ironclad Indemnity Corporation and a second, separate wire in the amount of $12,200,000.00 from Pinnacle Surplus Lines Inc. Combining the payments into a single wire transfer is not acceptable, as we must be able to properly attribute, receipt, and account for each client's settlement contribution individually in accordance with the terms of the Settlement Agreement and applicable trust account regulations.
In addition to the case reference information set forth above, we ask that the wiring party include the paying insurer's name and applicable policy number in the reference or memo field of each wire transfer, as follows:
Ironclad Indemnity Corporation: Policy No. IIC-PRP-2022-07541
Pinnacle Surplus Lines Inc.: Policy No. PSL-XS1-2022-3390
Including this information will allow our accounting department to reconcile each payment against the corresponding policy and the Payment Allocation Schedule without delay.
Confirmation of Wire Transfers
Upon initiation of each wire transfer, we request that you or your office provide prompt written confirmation via email to the undersigned, Tiffany Rosenthal, at Calderwood & Harkness LLP. Such confirmation should include the following information for each wire:
1. Date on which the wire transfer was initiated;
2. Dollar amount of the wire transfer;
3. Name of the paying entity (i.e., Ironclad Indemnity Corporation or Pinnacle Surplus Lines Inc.);
4. The federal reference number or bank confirmation number assigned to the wire transfer; and
5. The name and contact information of the wire originator at the sending bank, if available.
For purposes of providing wire confirmations and addressing any questions relating to the settlement payments, please direct all communications to:
Tiffany Rosenthal, Esq. Calderwood & Harkness LLP 333 SE 2nd Avenue, Suite 4400 Miami, FL 33131
Email: trosenthal@calderwoodharkness.com
Direct Telephone: (305) 884-7218
We will issue a formal written acknowledgment of receipt upon confirmation that each wire has cleared and the funds have been credited to our trust account.
Wire Verification / Security Protocol
IMPORTANT — PLEASE READ CAREFULLY. Before initiating any wire transfer based on the instructions contained in this letter, we strongly recommend that you or the authorized representative of the sending financial institution verify the accuracy of the wire instructions by contacting Tiffany Rosenthal directly by telephone at (305) 884-7218. Verification should be conducted by telephone only — not by email or any other electronic means of communication.
Please be advised that wire fraud and email interception schemes targeting law firm trust accounts and settlement payments are an increasing and serious threat. Calderwood & Harkness LLP will never change its wire transfer instructions via email. If you receive any email communication — whether purportedly from this firm, from VHG, or from any other party — that contains wire instructions different from those set forth in this letter, or that requests a change to these wire instructions, you should immediately disregard such communication and contact Tiffany Rosenthal by telephone at the number provided above to confirm the authenticity of any such request. Under no circumstances should wire instructions be modified based solely on email correspondence without independent telephonic verification with a known contact at this office.
Remaining Settlement Payments (Informational)
For completeness and your records, please be advised that separate wire transfer instructions are being provided contemporaneously to Delvecchio & Kraus LLP (Attention: Patricia Kraus, Esq.) for the settlement payments due from the remaining settling defendants, specifically:
Montclair Assurance Company: $6,800,000.00 (Six Million Eight Hundred Thousand and 00/100 Dollars)
Sovereign Re Ltd.: $3,800,000.00 (Three Million Eight Hundred Thousand and 00/100 Dollars)
The total aggregate settlement amount across all settling defendants is thus $47,300,000.00, allocated as follows: Ironclad Indemnity Corporation ($24,500,000.00) + Pinnacle Surplus Lines Inc. ($12,200,000.00) + Montclair Assurance Company ($6,800,000.00) + Sovereign Re Ltd. ($3,800,000.00). No further action is required of you or your clients with respect to the Montclair and Sovereign Re payments; this information is provided solely for informational and reconciliation purposes.
Stipulation of Dismissal
As contemplated by Section 7.1 of the Settlement Agreement, this firm will prepare and circulate a draft joint stipulation of voluntary dismissal with prejudice of all claims and counterclaims in Case No. 2022-CA-031547, pending before the Honorable Catherine Embry of the Eleventh Judicial Circuit of Florida, in and for Miami-Dade County. We expect to circulate the draft stipulation for your review and approval promptly following our confirmation of receipt of all settlement funds from all settling defendants. Upon approval by all parties and their respective counsel, the executed stipulation will be filed with the Clerk of the Court.
We trust that this timeline is agreeable and will work with your office to ensure the dismissal is filed expeditiously upon completion of all settlement payments.
Closing
We wish to express our appreciation for the professional and cooperative manner in which this matter was resolved, including through the productive mediation sessions held on December 4–5, 2023 before the Honorable Richard Mendelson (Ret.) at Keystone Dispute Resolution Inc. in Miami, Florida. The collaborative approach taken by all counsel contributed significantly to reaching this resolution, and we are pleased to bring this litigation to a close on terms acceptable to all parties.
Should you have any questions regarding the wire transfer instructions set forth herein, the payment schedule, or any other aspect of the settlement process, please do not hesitate to contact the undersigned or my colleague Elaine Forsythe at your earliest convenience.
Thank you for your prompt attention to this matter.
Very truly yours,
CALDERWOOD & HARKNESS LLP
________________________________________
Tiffany Rosenthal, Esq. Calderwood & Harkness LLP 333 SE 2nd Avenue, Suite 4400 Miami, FL 33131 Telephone: (305) 884-7218
Email: trosenthal@calderwoodharkness.com
cc: Elaine Forsythe, Esq. (Calderwood & Harkness LLP) Nathaniel Driscoll, Esq. (General Counsel, Verimark Hospitality Group Inc.) Meredith Liang, Esq. (Fendowell Rourke & Stanton LLP)
Encl.: Copy of Exhibit A — Payment Allocation Schedule (from Settlement Agreement and Mutual Release dated December 19, 2023)