TERM SHEET — MEDIATED SETTLEMENT
CONFIDENTIAL SETTLEMENT DOCUMENT
Executed at the Conclusion of Mediation Conducted December 4–5, 2023
VERIMARK HOSPITALITY GROUP INC., Plaintiff,
v.
IRONCLAD INDEMNITY CORPORATION; PINNACLE SURPLUS LINES INC.; MONTCLAIR ASSURANCE COMPANY; and SOVEREIGN RE LTD., Defendants.
Case No. 2022-CA-031547 Eleventh Judicial Circuit of Florida, Miami-Dade County Before the Honorable Catherine Embry, Circuit Judge
Date: December 5, 2023
Mediation Venue: Keystone Dispute Resolution Inc. 200 S. Biscayne Boulevard, Suite 3100 Miami, FL 33131
Mediator: Hon. Richard Mendelson (Ret.)
RECITALS AND PREAMBLE
This Term Sheet — Mediated Settlement (this "Term Sheet") is entered into as of December 5, 2023, at the conclusion of mediation conducted on December 4–5, 2023, before the Honorable Richard Mendelson (Ret.) at Keystone Dispute Resolution Inc., 200 S. Biscayne Boulevard, Suite 3100, Miami, Florida 33131, by and among the following parties:
Identification of the Parties
Plaintiff:
Verimark Hospitality Group Inc., a Delaware corporation, publicly traded on the Nasdaq Stock Market under the ticker symbol "VMRK," with its principal offices located at 1900 Brickell Avenue, Suite 3200, Miami, Florida 33129 (hereinafter referred to as "VHG" or "Plaintiff").
Defendant Ironclad Indemnity Corporation:
Ironclad Indemnity Corporation, a Connecticut-domiciled stock insurance company, with its principal offices located at 55 Constitution Boulevard, Hartford, Connecticut 06103 (hereinafter referred to as "Ironclad").
Defendant Pinnacle Surplus Lines Inc.:
Pinnacle Surplus Lines Inc., a Texas-domiciled surplus-lines insurer, with its principal offices located at 200 Congress Avenue, Suite 1400, Austin, Texas 78701 (hereinafter referred to as "Pinnacle").
Defendant Montclair Assurance Company:
Montclair Assurance Company, a New York-domiciled admitted carrier, with its principal offices located at 1 Liberty Plaza, 38th Floor, New York, New York 10006 (hereinafter referred to as "Montclair").
Defendant Sovereign Re Ltd.:
Sovereign Re Ltd., a Bermuda-domiciled reinsurer and excess carrier, with its principal offices located at 14 Front Street, Hamilton HM 11, Bermuda (hereinafter referred to as "Sovereign Re").
VHG, Ironclad, Pinnacle, Montclair, and Sovereign Re are collectively referred to herein as the "Parties." Ironclad, Pinnacle, Montclair, and Sovereign Re are collectively referred to herein as the "Insurer Defendants."
Identification of Counsel
Counsel for Plaintiff (VHG):
Calderwood & Harkness LLP, 333 SE 2nd Avenue, Suite 4400, Miami, Florida 33131. Elaine Forsythe, Responsible Partner; Tiffany Rosenthal, Lead Associate.
Counsel for Ironclad Indemnity Corporation and Pinnacle Surplus Lines Inc.:
Fendowell Rourke & Stanton LLP, 280 Trumbull Street, Suite 2200, Hartford, Connecticut 06103 (Hartford office); 101 E. Kennedy Boulevard, Suite 3900, Tampa, Florida 33602 (Tampa office). Gregory Stanton, Lead Partner.
Counsel for Montclair Assurance Company and Sovereign Re Ltd.:
Delvecchio & Kraus LLP, 425 Park Avenue, 20th Floor, New York, New York 10022. Patricia Kraus, Lead Partner.
Background. WHEREAS, VHG owns and operates three resort properties in the State of Florida, specifically: (i) Verimark Grand Key Resort, located at Mile Marker 48, Marathon, Florida 33050; (ii) Verimark Harborview Hotel & Conference Center, located at 1400 Estero Boulevard, Fort Myers Beach, Florida 33931; and (iii) Verimark Sunset Shores, located at 7200 Gulf Boulevard, St. Pete Beach, Florida 33706;
WHEREAS, Hurricane Callista, classified as a Category 4 hurricane by the National Hurricane Center, made landfall on September 18, 2022, in the Lower Florida Keys, causing catastrophic property damage and prolonged business interruption at all three of VHG's resort properties;
WHEREAS, at the time of Hurricane Callista, VHG maintained a property and business-interruption insurance program with a total tower limit of Sixty Million Dollars ($60,000,000) above a Five Hundred Thousand Dollar ($500,000) per-occurrence deductible, structured as follows:
(a) Primary Layer: Ironclad Indemnity Corporation, Twenty-Five Million Dollars ($25,000,000) limit, Policy No. IIC-PRP-2022-07541;
(b) First Excess Layer: Pinnacle Surplus Lines Inc., Fifteen Million Dollars ($15,000,000) excess of Twenty-Five Million Dollars ($25,000,000), Policy No. PSL-XS1-2022-3390;
(c) Second Excess Layer: Montclair Assurance Company, Ten Million Dollars ($10,000,000) excess of Forty Million Dollars ($40,000,000), Policy No. MAC-XS2-2022-09817;
(d) Third Excess Layer: Sovereign Re Ltd., Ten Million Dollars ($10,000,000) excess of Fifty Million Dollars ($50,000,000), Policy No. SRL-XS3-2022-5102;
WHEREAS, all four insurance policies referenced above share a common policy period of July 1, 2022, through July 1, 2023;
WHEREAS, VHG submitted a sworn statement in proof of loss on November 15, 2022, claiming approximately Sixty Million Dollars ($60,000,000) in aggregate business-interruption losses arising from Hurricane Callista across all three resort properties;
WHEREAS, Ironclad issued a formal denial of coverage on February 3, 2023, asserting, among other grounds, the applicability of a named-windstorm sub-limit and various policy exclusions; Pinnacle followed with its own formal denial of coverage on February 10, 2023, relying upon substantially similar grounds and asserting that its excess layer was not triggered in the absence of exhaustion of the primary layer; Montclair and Sovereign Re each issued reservation-of-rights letters but did not issue formal denials of coverage;
WHEREAS, VHG filed suit on March 1, 2023, in the Eleventh Judicial Circuit of Florida, Miami-Dade County, under Case No. 2022-CA-031547, asserting claims for breach of contract, declaratory judgment, and bad faith against all four Insurer Defendants;
WHEREAS, cross-motions for partial summary judgment regarding the named-windstorm sub-limit were pending at the time of mediation, with VHG's motion for partial summary judgment having been filed on November 1, 2023, and the Insurer Defendants' cross-motion for partial summary judgment having been filed on November 15, 2023, and no ruling having been issued on either motion;
WHEREAS, on November 20, 2023, the Honorable Catherine Embry ordered the Parties to participate in mediation prior to the Court's ruling on the pending summary judgment motions;
WHEREAS, the Parties participated in mediation on December 4–5, 2023, before the Honorable Richard Mendelson (Ret.) at Keystone Dispute Resolution Inc., Miami, Florida; and
WHEREAS, at the conclusion of the mediation session on December 5, 2023, the Parties reached an agreement in principle to settle all claims, counterclaims, and disputes in the above-captioned action on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
This Term Sheet memorializes the principal terms of the settlement reached at the conclusion of mediation on December 5, 2023, and shall be binding on all Parties upon execution, subject to the preparation and execution of a definitive Settlement Agreement and Mutual Release as contemplated in Section 7 below.
SECTION 1: SETTLEMENT PAYMENT AMOUNT
1.1 Aggregate Settlement Amount
The Insurer Defendants shall collectively pay to VHG a total aggregate settlement amount of Forty-Seven Million Three Hundred Thousand Dollars ($47,300,000) (the "Settlement Amount"). The Settlement Amount represents approximately 78.83% of VHG's total claimed loss of Sixty Million Dollars ($60,000,000) under the insurance program referenced herein. The Settlement Amount is inclusive of all claims for property damage, business-interruption loss, extra expense, debris removal, and any and all other coverages or benefits under the referenced policies, and is further inclusive of any and all claims for interest, penalties, attorneys' fees, and costs asserted or assertable in the above-captioned litigation.
1.2 Allocation Among Insurer Defendants
The aggregate Settlement Amount of $47,300,000 shall be allocated among the Insurer Defendants as follows:
(a) Ironclad Indemnity Corporation: Twenty-Four Million Five Hundred Thousand Dollars ($24,500,000), representing the full primary layer limit of $25,000,000 less the $500,000 per-occurrence deductible;
(b) Pinnacle Surplus Lines Inc.: Twelve Million Two Hundred Thousand Dollars ($12,200,000), representing approximately 81.33% of Pinnacle's $15,000,000 first excess layer;
(c) Montclair Assurance Company: Six Million Eight Hundred Thousand Dollars ($6,800,000), representing approximately 68.0% of Montclair's $10,000,000 second excess layer; and
(d) Sovereign Re Ltd.: Three Million Eight Hundred Thousand Dollars ($3,800,000), representing approximately 38.0% of Sovereign Re's $10,000,000 third excess layer.
For purposes of verification: $24,500,000 + $12,200,000 + $6,800,000 + $3,800,000 = $47,300,000.
1.3 Several Obligations
Each Insurer Defendant's obligation under this Term Sheet and the contemplated Settlement Agreement is several and not joint. Each Insurer Defendant shall be responsible solely for its individual allocated share of the Settlement Amount as set forth in Section 1.2 above. No Insurer Defendant shall have any obligation or liability for the payment of any other Insurer Defendant's allocated share. VHG acknowledges and agrees that it shall look only to each individual Insurer Defendant for that Insurer Defendant's allocated share and shall have no right to seek recovery from any Insurer Defendant for any shortfall in payment by another Insurer Defendant.
SECTION 2: PAYMENT TERMS
2.1 Form of Payment
All payments to be made by each Insurer Defendant under this Term Sheet and the definitive Settlement Agreement shall be made by wire transfer of immediately available funds in United States dollars to the trust account designated by Calderwood & Harkness LLP, as counsel for VHG.
2.2 Payment Deadline
Each Insurer Defendant shall remit its allocated share of the Settlement Amount, as set forth in Section 1.2 above, within forty-five (45) calendar days following the date of execution of the definitive Settlement Agreement and Mutual Release by all Parties. Based on the anticipated execution of the definitive Settlement Agreement on or before December 19, 2023, the resulting payment deadline is anticipated to be on or before February 2, 2024. In the event the definitive Settlement Agreement is executed on a date other than December 19, 2023, the forty-five (45) calendar day payment deadline shall be calculated from the actual date of full execution by all Parties.
2.3 Payment Instructions
All settlement payments shall be directed to the Interest on Trust Account ("IOTA") or other designated trust account of Calderwood & Harkness LLP, as counsel for VHG. Calderwood & Harkness LLP shall provide written wire transfer instructions to counsel for each Insurer Defendant promptly following the execution of the definitive Settlement Agreement. No payment shall be made directly to VHG or to any person or entity other than the designated trust account of Calderwood & Harkness LLP unless otherwise agreed in writing by VHG and its counsel.
2.4 Lump-Sum Payment
All payments required under this Term Sheet and the definitive Settlement Agreement shall be made in a single lump-sum installment. No installment payment schedule, periodic payment arrangement, structured settlement, or deferred payment of any kind is contemplated or agreed to by the Parties. Each Insurer Defendant shall remit its full allocated share in a single wire transfer within the payment deadline set forth in Section 2.2 above.
SECTION 3: MUTUAL RELEASE
3.1 Scope of Release
Upon receipt by Calderwood & Harkness LLP, on behalf of VHG, of the full aggregate Settlement Amount of $47,300,000 (i.e., upon receipt of all four Insurer Defendants' respective allocated shares), the Parties shall exchange mutual general releases of all claims, counterclaims, cross-claims, causes of action, demands, obligations, damages, losses, costs, expenses, and liabilities of every kind and nature, whether known or unknown, suspected or unsuspected, accrued or unaccrued, contingent or absolute, arising from, relating to, or in any way connected with the losses sustained by VHG as a result of Hurricane Callista (September 18, 2022) under the following insurance policies:
(a) Ironclad Indemnity Corporation Policy No. IIC-PRP-2022-07541;
(b) Pinnacle Surplus Lines Inc. Policy No. PSL-XS1-2022-3390;
(c) Montclair Assurance Company Policy No. MAC-XS2-2022-09817; and
(d) Sovereign Re Ltd. Policy No. SRL-XS3-2022-5102.
3.2 Breadth of Release
The mutual release shall encompass, without limitation, all claims and causes of action for breach of contract, declaratory judgment, bad faith (statutory and common law), breach of the implied covenant of good faith and fair dealing, unfair claims settlement practices (including but not limited to claims under Florida Statutes § 624.155 and § 626.9541), and any and all statutory penalties, punitive damages, consequential damages, attorneys' fees, costs, interest (pre-judgment and post-judgment), and any other relief sought or that could have been sought in the above-captioned litigation or in any other forum.
The mutual release shall run to and from each Party and their respective past, present, and future parents, affiliates, subsidiaries, divisions, officers, directors, shareholders, members, partners, employees, agents, representatives, attorneys, insurers, reinsurers, predecessors, successors, and assigns.
3.3 Carve-outs. Notwithstanding the foregoing, the mutual release contemplated herein shall be subject to the following express carve-outs:
(a) The mutual release shall not release, discharge, or otherwise affect any obligations arising under the definitive Settlement Agreement itself, including without limitation the payment obligations set forth in Sections 1 and 2 of this Term Sheet and as further described in the definitive Settlement Agreement. The Parties retain all rights and remedies to enforce the terms and conditions of the Settlement Agreement.
(b) The mutual release shall not affect, impair, or otherwise modify coverage under the referenced policies (IIC-PRP-2022-07541, PSL-XS1-2022-3390, MAC-XS2-2022-09817, and SRL-XS3-2022-5102) for any loss, claim, or occurrence other than Hurricane Callista (September 18, 2022). To the extent VHG has or may assert any claim under any of the referenced policies arising from any event or occurrence other than Hurricane Callista, such claims are expressly preserved and are not affected by this Term Sheet or the contemplated Settlement Agreement.
SECTION 4: NO ADMISSION OF LIABILITY
4.1 No Admission
This settlement and the payments made hereunder do not constitute, and shall not be construed as, an admission of liability, coverage, wrongdoing, fault, or responsibility by any Insurer Defendant, individually or collectively. No Party shall characterize this settlement, the Settlement Amount, or any individual Insurer Defendant's allocated share as an admission of liability, coverage, or wrongdoing in any judicial, administrative, regulatory, or arbitral proceeding, or in any public statement, press release, or communication. Each Insurer Defendant expressly denies that it breached any obligation under its respective insurance policy, denied coverage improperly, or acted in bad faith with respect to VHG's Hurricane Callista claim.
4.2 Settlement Compromise
The Parties acknowledge and agree that this settlement represents a compromise of disputed claims and is entered into solely to avoid the cost, uncertainty, delay, and burden of continued litigation. The Parties have weighed the risks and uncertainties inherent in the pending litigation, including the outcome of the cross-motions for partial summary judgment regarding the named-windstorm sub-limit and the risks and costs of trial, and have determined that settlement on the terms set forth herein is in their respective best interests. This Term Sheet and the definitive Settlement Agreement shall not be admissible as evidence of liability, coverage, or damages in any proceeding other than a proceeding to enforce the terms of the Settlement Agreement itself.
SECTION 5: CONFIDENTIALITY
5.1 Confidentiality of Settlement Amount
The specific dollar amount of the settlement (i.e., $47,300,000), the individual allocations among the Insurer Defendants as set forth in Section 1.2, and the specific financial terms of this Term Sheet and the definitive Settlement Agreement shall be kept strictly confidential by all Parties, their counsel, and their respective officers, directors, employees, and agents, and shall not be disclosed to any third party except as expressly permitted by this Section 5.
5.2 Disclosure of Existence
Notwithstanding Section 5.1, the Parties may disclose the existence of the settlement — that is, the fact that the above-captioned litigation has been resolved — without disclosing the Settlement Amount, the individual allocations, or any other specific financial terms. Any public statement regarding the settlement shall be limited to language substantially to the effect that "the matter has been resolved" or "the parties have reached a mutually agreeable resolution," unless otherwise agreed in writing by all Parties.
5.3 Permitted Disclosures
Notwithstanding the confidentiality obligations set forth in Sections 5.1 and 5.2, the Parties may disclose the terms of this Term Sheet and the definitive Settlement Agreement under the following circumstances:
(a) As required by applicable law, regulation, or court order, including but not limited to any subpoena or order from a court of competent jurisdiction;
(b) As required by applicable securities-disclosure obligations, including VHG's obligations as a publicly traded company listed on the Nasdaq Stock Market under applicable rules of the Securities and Exchange Commission, including but not limited to filings on Form 8-K, Form 10-Q, Form 10-K, or any other required periodic or current report;
(c) To accountants, auditors, tax advisors, actuaries, and financial advisors as reasonably necessary for financial reporting, tax preparation, regulatory compliance, and audit purposes, provided that such persons are informed of the confidential nature of the settlement terms and agree to maintain such confidentiality;
(d) To applicable state insurance regulatory authorities to the extent required by law or regulation governing the operations of any Insurer Defendant; and
(e) Each Insurer Defendant may disclose the settlement terms, including the Settlement Amount and its individual allocation, to its reinsurers and retrocessionaires as reasonably necessary for the administration of applicable reinsurance treaties, contracts, or arrangements.
5.4 Remedies for Breach
Any breach of the confidentiality provisions set forth in this Section 5 shall be subject to remedies as set forth in the definitive Settlement Agreement, which shall include, at a minimum, the right of any non-breaching Party to seek injunctive relief and monetary damages. The Parties acknowledge that a breach of these confidentiality provisions may cause irreparable harm for which monetary damages alone may be an inadequate remedy, and accordingly agree that equitable relief, including injunctive relief, shall be available without the necessity of posting a bond or other security.
SECTION 6: DISMISSAL OF LITIGATION
6.1 Joint Stipulation of Dismissal
Within ten (10) business days following receipt by Calderwood & Harkness LLP, on behalf of VHG, of all settlement payments from all Insurer Defendants constituting the full Settlement Amount of $47,300,000, the Parties shall file a Joint Stipulation of Dismissal with Prejudice of all claims, counterclaims, and cross-claims in Case No. 2022-CA-031547, in the Eleventh Judicial Circuit of Florida, Miami-Dade County, before the Honorable Catherine Embry. Each Party shall bear responsibility for its pro rata share of any filing fees associated with such dismissal. Counsel for VHG shall prepare the Joint Stipulation of Dismissal, and counsel for each Insurer Defendant shall promptly execute and return the same.
6.2 Costs and Fees
Each Party shall bear its own attorneys' fees, costs, and expenses incurred in connection with the above-captioned litigation, the mediation, the negotiation of this Term Sheet, and the preparation and execution of the definitive Settlement Agreement and Mutual Release, except as may be otherwise expressly provided in the definitive Settlement Agreement. No Party shall seek to recover attorneys' fees, costs, or expenses from any other Party in connection with this matter.
6.3 Withdrawal of Pending Motions
Upon filing of the Joint Stipulation of Dismissal with Prejudice, all pending motions in the above-captioned litigation shall be deemed withdrawn as moot, including without limitation: (i) VHG's Motion for Partial Summary Judgment Regarding the Named-Windstorm Sub-Limit, filed November 1, 2023; and (ii) the Insurer Defendants' Cross-Motion for Partial Summary Judgment Regarding the Named-Windstorm Sub-Limit, filed November 15, 2023. The Parties shall include appropriate language in the Joint Stipulation of Dismissal advising the Court that all pending motions are withdrawn and requesting that the Court vacate any scheduled hearings.
SECTION 7: DEFINITIVE SETTLEMENT AGREEMENT
7.1 Obligation to Negotiate in Good Faith
The Parties shall negotiate in good faith and use commercially reasonable efforts to prepare, finalize, and execute a definitive Settlement Agreement and Mutual Release (the "Settlement Agreement") that incorporates, expands upon, and is consistent with the terms and conditions set forth in this Term Sheet. In the event of any conflict between the terms of this Term Sheet and the terms of the definitive Settlement Agreement, the terms of the definitive Settlement Agreement shall control, provided that no term of the definitive Settlement Agreement shall materially alter the economic terms set forth in Sections 1 and 2 of this Term Sheet without the written consent of all Parties.
7.2 Target Date for Execution
The Parties shall use commercially reasonable efforts to negotiate, finalize, and execute the definitive Settlement Agreement on or before December 19, 2023 — that is, within fourteen (14) calendar days of the date of this Term Sheet. The Parties acknowledge that this target date is aspirational and that failure to meet such target date shall not constitute a breach of this Term Sheet, provided that all Parties continue to negotiate in good faith.
7.3 Drafting Responsibility
Calderwood & Harkness LLP, as counsel for VHG, shall prepare the initial draft of the definitive Settlement Agreement and shall circulate such draft to Fendowell Rourke & Stanton LLP (counsel for Ironclad and Pinnacle) and Delvecchio & Kraus LLP (counsel for Montclair and Sovereign Re) within five (5) business days of the date of this Term Sheet — that is, on or before December 12, 2023. Counsel for the Insurer Defendants shall provide comments and proposed revisions within a reasonable time following receipt of the initial draft.
7.4 Additional Terms to Be Addressed in Definitive Agreement
The definitive Settlement Agreement shall address, in addition to the terms set forth in this Term Sheet, the following matters, among others:
(a) Representations and warranties of each Party, including representations of corporate authority, due authorization, and no pending bankruptcy or insolvency proceedings;
(b) Detailed wire transfer instructions and payment mechanics, including confirmation procedures and receipts;
(c) Tax treatment and reporting obligations, including characterization of the Settlement Amount for federal and state income tax purposes, issuance of IRS Forms 1099 (if applicable), and allocation of the Settlement Amount among categories of damages for tax reporting purposes;
(d) Mutual indemnification provisions related to tax treatment, including indemnification for any adverse tax consequences arising from a Party's mischaracterization of the settlement proceeds;
(e) An integration clause providing that the Settlement Agreement constitutes the entire agreement among the Parties with respect to the subject matter thereof, and supersedes all prior and contemporaneous negotiations, discussions, agreements, representations, and understandings, whether written or oral;
(f) Choice of governing law (State of Florida);
(g) A dispute resolution mechanism for any disputes arising under or relating to the Settlement Agreement, which may include mediation, binding arbitration, or litigation in the Eleventh Judicial Circuit of Florida;
(h) Provisions for execution in counterparts and acceptance of electronic signatures in accordance with the Florida Uniform Electronic Transaction Act (Florida Statutes § 668.50) and the federal Electronic Signatures in Global and National Commerce Act (15 U.S.C. § 7001 et seq.); and
(i) Such other terms and provisions as are customary in settlement agreements of this nature and as the Parties may mutually agree upon in good faith.
SECTION 8: BINDING NATURE OF TERM SHEET
8.1 Binding Obligation
This Term Sheet constitutes a binding agreement among the Parties with respect to the material terms set forth herein. This Term Sheet is intended to be, and shall be, enforceable by any Party in the Eleventh Judicial Circuit of Florida, Miami-Dade County, or in any other court of competent jurisdiction. The Parties acknowledge that they have entered into this Term Sheet voluntarily, with the advice and assistance of counsel, and with a full understanding of its terms and legal consequences. Any Party may seek specific performance or other equitable or legal relief to enforce the obligations set forth herein.
8.2 Survival. The binding obligations set forth in this Term Sheet shall remain in full force and effect until superseded by the execution of the definitive Settlement Agreement and Mutual Release by all Parties. Upon execution of the definitive Settlement Agreement, this Term Sheet shall be deemed merged into and superseded by the Settlement Agreement, except to the extent the Settlement Agreement expressly provides otherwise.
8.3 Governing Law
This Term Sheet shall be governed by and construed in accordance with the laws of the State of Florida, without regard to its conflict-of-laws principles.
SECTION 9: MISCELLANEOUS
9.1 Notices. All notices, requests, demands, and other communications required or permitted under this Term Sheet shall be in writing and shall be directed to counsel of record for each Party at the addresses set forth in the Recitals above, or to such other address as any Party may designate in writing from time to time. Notices may be delivered by personal delivery, overnight courier, or electronic mail to counsel of record.
9.2 Amendment. This Term Sheet may not be amended, modified, supplemented, or waived except by a written instrument duly executed by authorized representatives of all Parties. No oral modification or waiver of any provision of this Term Sheet shall be effective for any purpose.
9.3 Counterparts. This Term Sheet may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Facsimile signatures and electronic signatures transmitted by electronic mail in portable document format (PDF) shall be deemed original signatures for all purposes.
9.4 Authority. Each person signing this Term Sheet on behalf of a Party hereby represents and warrants that he or she has been duly authorized to execute this Term Sheet on behalf of such Party, that such execution has been duly authorized by all necessary corporate, organizational, or other action, and that this Term Sheet constitutes a valid and binding obligation of such Party, enforceable against such Party in accordance with its terms.
SIGNATURES
IN WITNESS WHEREOF, the Parties, by their duly authorized representatives and counsel, have executed this Term Sheet — Mediated Settlement as of December 5, 2023.
PLAINTIFF — VERIMARK HOSPITALITY GROUP INC.
VERIMARK HOSPITALITY GROUP INC.
By: ________
Name: Nathaniel Driscoll
Title: General Counsel
Date: ________
APPROVED AS TO FORM — COUNSEL FOR VHG
By: ________
Name: Elaine Forsythe
Firm: Calderwood & Harkness LLP 333 SE 2nd Avenue, Suite 4400 Miami, FL 33131
Date: ________
DEFENDANT — IRONCLAD INDEMNITY CORPORATION
IRONCLAD INDEMNITY CORPORATION
By: ________
Name: Victor Haddon
Title: Senior Vice President of Claims
Date: ________
APPROVED AS TO FORM — COUNSEL FOR IRONCLAD
By: ________
Name: Gregory Stanton
Firm: Fendowell Rourke & Stanton LLP 280 Trumbull Street, Suite 2200 Hartford, CT 06103
Date: ________
DEFENDANT — PINNACLE SURPLUS LINES INC.
PINNACLE SURPLUS LINES INC.
By: ________
Name: ________
Title: ________
Date: ________
APPROVED AS TO FORM — COUNSEL FOR PINNACLE
By: ________
Name: Gregory Stanton
Firm: Fendowell Rourke & Stanton LLP 101 E. Kennedy Boulevard, Suite 3900 Tampa, FL 33602
Date: ________
DEFENDANT — MONTCLAIR ASSURANCE COMPANY
MONTCLAIR ASSURANCE COMPANY
By: ________
Name: ________
Title: ________
Date: ________
APPROVED AS TO FORM — COUNSEL FOR MONTCLAIR
By: ________
Name: Patricia Kraus
Firm: Delvecchio & Kraus LLP 425 Park Avenue, 20th Floor New York, NY 10022
Date: ________
DEFENDANT — SOVEREIGN RE LTD.
SOVEREIGN RE LTD.
By: ________
Name: ________
Title: ________
Date: ________
APPROVED AS TO FORM — COUNSEL FOR SOVEREIGN RE
By: ________
Name: Patricia Kraus
Firm: Delvecchio & Kraus LLP 425 Park Avenue, 20th Floor New York, NY 10022
Date: ________
MEDIATOR ACKNOWLEDGMENT
I, the Honorable Richard Mendelson (Ret.), mediator with Keystone Dispute Resolution Inc., hereby acknowledge that this Term Sheet — Mediated Settlement was executed in my presence, and with my facilitation, at the conclusion of mediation conducted on December 4–5, 2023, at Keystone Dispute Resolution Inc., 200 S. Biscayne Boulevard, Suite 3100, Miami, Florida 33131.
I further confirm that the Parties and their respective counsel participated in the mediation in good faith, and that the Parties reached the agreement memorialized in this Term Sheet voluntarily, without coercion or duress, and with the full advice and assistance of their respective legal counsel. Each Party had ample opportunity to consult with counsel, to review the terms of this Term Sheet, and to make an informed and voluntary decision to accept the settlement reflected herein.
MEDIATOR — KEYSTONE DISPUTE RESOLUTION INC.
By: ________
Hon. Richard Mendelson (Ret.) Mediator Keystone Dispute Resolution Inc. 200 S. Biscayne Boulevard, Suite 3100 Miami, FL 33131