CALDERWOOD & HARKNESS LLP
MEMORANDUM — PRIVILEGED & CONFIDENTIAL INTERNAL CALDERWOOD & HARKNESS LLP WORK PRODUCT
TO: Engagement File, 1025-00005
FROM: Natasha Forbes, Lead Associate, Capital Markets Practice Group
APPROVED BY: Howard Bellamy, Billing Partner, Antitrust & Competition Practice Group
DATE: December 19, 2025
RE: Engagement Closing Memorandum — Quorum Insurance Holdings Corp. — Committee Charter & Delegation-of-Authority Overhaul
ENGAGEMENT NUMBER: 1025-00005
RESPONSIBLE PARTNER: Elaine Forsythe
BILLING PARTNER: Howard Bellamy
STATUS: Closing
This memorandum constitutes privileged and confidential attorney work product of Calderwood & Harkness LLP. It is prepared solely for the internal files of the firm in connection with Engagement No. 1025-00005 and is not intended for distribution to any person or entity outside the firm without the express prior written authorization of the Responsible Partner. This memorandum is protected by the attorney-client privilege, the attorney work-product doctrine, and all other applicable privileges and protections.
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I. ENGAGEMENT SUMMARY
A. Client Identification
Client: Quorum Insurance Holdings Corp. ("Quorum" or "QIH")
Quorum Insurance Holdings Corp. is a Delaware corporation that is publicly traded on the New York Stock Exchange under the ticker symbol "QIHC." The company's Employer Identification Number is 27-4831956, and it is registered with the Delaware Division of Corporations under File Number 4927361. QIH's corporate headquarters are located at 280 Asylum Street, Suite 2200, Hartford, Connecticut 06103. The company's registered agent in Delaware is Capitol Registered Agents, Inc., with offices at 1209 Orange Street, Wilmington, Delaware 19801.
Quorum is a multi-line insurance holding company that operates through several regulated insurance subsidiaries and maintains a growing portfolio of financial technology ("fintech") subsidiaries. As of September 2025, QIH's approximate market capitalization was $4.8 billion. For the fiscal year ended December 31, 2024, QIH reported consolidated revenue of $3.12 billion and total consolidated assets of approximately $18.7 billion. The company employs approximately 6,400 persons across its various operating entities.
QIH's Board of Directors consists of eleven (11) directors, of whom eight (8) are classified as independent under NYSE listing standards and three (3) are management or otherwise non-independent directors. The key members of Quorum's senior leadership team relevant to this engagement are identified as follows:
• Chief Executive Officer & Chair of the Board: Margaret A. Calloway
• General Counsel & Corporate Secretary: Dennis R. Okonkwo (primary client contact throughout this engagement)
• Chief Financial Officer: Patricia Sung-Hee Lam
• Chief Compliance Officer: Ivan D. Pruett
• Chief Audit Executive: Renata M. Vásquez
Mr. Okonkwo served as the primary point of contact for all engagement matters and was responsible for coordinating access to board members, internal stakeholders, and relevant corporate records. The Calderwood & Harkness engagement team maintained regular communication with Mr. Okonkwo throughout the engagement period, including weekly status calls from September through November 2025 and ad hoc communications as required during the final document-preparation phase.
B. Key Subsidiaries Within Scope
The scope of this engagement extended to the governance framework applicable to QIH's principal operating subsidiaries. The following five entities were specifically within the scope of the engagement, as set forth in the engagement letter and as confirmed at the September 12, 2025 kickoff meeting:
1. Quorum Property & Casualty Insurance Company — Domiciled in the State of Connecticut; National Association of Insurance Commissioners ("NAIC") Company Code 38472. Quorum P&C is QIH's largest regulated insurance subsidiary and writes a diversified book of commercial and personal lines property and casualty insurance.
2. Lone Star Specialty Insurance Company — Domiciled in the State of Texas; NAIC Company Code 41359. Lone Star Specialty writes excess and surplus lines and specialty commercial insurance products, principally in the energy, construction, and professional liability segments.
3. Great Lakes Surety & Indemnity Co. — Domiciled in the State of Ohio; NAIC Company Code 29814. Great Lakes Surety focuses on commercial surety, fidelity, and specialty indemnity products across the Midwest and Mid-Atlantic regions.
4. Quorum MGA Services, LLC — A Delaware limited liability company that operates as QIH's managing general agency platform, facilitating program business and delegated underwriting authority arrangements with third-party carriers.
5. Vantage Digital Insurance Solutions, Inc. — A Delaware corporation that serves as QIH's insurtech subsidiary, developing and operating proprietary digital distribution platforms, automated underwriting systems, and data analytics capabilities.
The inclusion of the regulated insurance subsidiaries within the engagement scope was driven in significant part by the need to harmonize delegation-of-authority thresholds between the parent company and subsidiary levels and to address the state insurance regulatory filing implications attendant to material governance changes at the holding company level.
C. Nature of Engagement
This engagement involved a comprehensive overhaul of QIH's board committee charters and delegation-of-authority ("DOA") framework. The work encompassed the review and restatement of all five existing standing committee charters, the creation of a charter for a new sixth standing committee, the revision of the parent-level DOA Matrix, the development of a model subsidiary DOA matrix template, and the preparation of conforming amendments to QIH's Corporate Governance Guidelines and Bylaws. The engagement also included the delivery of legal analysis memoranda on Delaware corporate law and NYSE listing-rule compliance, as well as the preparation of board-meeting materials and resolutions for the formal adoption of all governance documents.
The engagement letter was executed on September 5, 2025, by Dennis R. Okonkwo on behalf of QIH and by Elaine Forsythe on behalf of Calderwood & Harkness LLP. The target closing date for the engagement was established as December 19, 2025, which is the date of this memorandum.
D. Background and Triggers
Several converging events and stakeholder communications precipitated the QIH Board's decision to undertake a comprehensive governance overhaul:
Auditor Management Letter. Garrett & Whitfield LLP, QIH's independent registered public accounting firm (lead engagement partner: Roland S. Brewer), issued a management letter dated March 14, 2025, in connection with the fiscal year 2024 audit. The management letter identified three governance-related observations:
(1) Inconsistent Dollar Thresholds. The management letter noted that dollar thresholds set forth in the parent-level DOA Matrix were inconsistent with the authorities actually being exercised at certain subsidiary levels. Specifically, the management letter observed that certain subsidiary officers appeared to exercise authority in excess of amounts contemplated by the parent DOA Matrix without clear documentation of subsidiary-level board authorization or parent-level ratification.
(2) Absence of Technology & Information Security Committee Charter. The auditors observed that QIH lacked a formal standing committee with explicit oversight responsibility for cybersecurity, information technology strategy, data privacy, and related technology risk. While certain technology-related matters were nominally addressed within the Risk Committee's purview, no formalized charter provisions or dedicated committee structure existed to provide the level of oversight increasingly expected of publicly traded companies, particularly those operating in regulated financial services sectors.
(3) Claims-Settlement Authority Breach — Lone Star Specialty. The management letter identified that Lone Star Specialty Insurance Company's executive team had been approving individual claims settlements at amounts up to $3.0 million, notwithstanding that the board-approved authority for subsidiary CEO-level claims settlements was limited to $1.0 million per individual claim. No formal documentation of board ratification for settlements between $1.0 million and $3.0 million was identified in the minutes or records reviewed by the auditors.
Shareholder Engagement. Veltrano Institutional Partners, LP, QIH's largest institutional shareholder with an ownership stake of approximately 8.3% of outstanding shares, submitted a formal shareholder letter dated June 18, 2025, addressed to Arthur J. Pennington in his capacity as Lead Independent Director of the QIH Board. The letter, signed by Terrence "Terry" Blackwood, Veltrano's Head of Governance, urged the Board to undertake a comprehensive modernization of QIH's governance framework. The Veltrano letter specifically referenced the auditor management letter observations, the absence of a dedicated technology oversight committee, and what Veltrano characterized as the need for QIH's governance framework to keep pace with the company's significant growth and strategic evolution since the original committee charters were adopted in 2016.
Proxy Advisory Benchmarking. At the direction of the Nominating & Corporate Governance Committee, QIH retained Apex Proxy Advisors, Inc. (SVP: Dana Durneval) to conduct a governance benchmarking analysis. The Apex Proxy Advisors benchmarking report, delivered on June 30, 2025, compared QIH's governance framework to those of fourteen (14) peer publicly traded insurance holding companies. The benchmarking report highlighted several areas in which QIH's governance structures lagged peer practices, including the absence of a technology/cybersecurity committee (eleven of fourteen peers had either a standalone technology committee or explicit charter provisions assigning technology oversight to a named committee), the age of QIH's DOA Matrix (twelve of fourteen peers had comprehensively updated their DOA frameworks within the prior twenty-four months), and various charter-content gaps relative to current best practices.
Additional Shareholder Support. Westbrook Fiduciary Trust Company, QIH's second-largest institutional shareholder with an ownership stake of approximately 5.7% of outstanding shares, expressed informal support for the governance modernization initiative through its Director of ESG & Governance, Elisa N. Fujimoto. While Westbrook did not submit a formal written request, Ms. Fujimoto communicated Westbrook's supportive position to Mr. Pennington and Mr. Okonkwo during the course of routine shareholder engagement.
Board Authorization. Following its consideration of the foregoing inputs, the QIH Board of Directors authorized the governance overhaul project at its regular meeting on July 22, 2025. The Board directed management to issue a request for proposals to qualified outside law firms. QIH issued the RFP on August 15, 2025, soliciting proposals from three law firms. Following evaluation of the proposals, Calderwood & Harkness LLP was selected and engaged, and the engagement letter was executed on September 5, 2025.
E. Scope of Work (Per Engagement Letter)
The engagement letter defined the scope of Calderwood & Harkness's work to include the following seven workstreams:
1. Committee Charter Review and Restatement. Review and restate all five existing standing committee charters—Audit Committee, Compensation & Human Capital Committee, Nominating & Corporate Governance Committee, Risk Committee, and Investment Committee—to bring them into conformity with current NYSE listing standards, applicable SEC rules, Delaware corporate law requirements, and governance best practices as informed by peer benchmarking.
2. New Committee Charter Drafting. Draft a new charter for a sixth standing committee, the Technology & Cybersecurity Oversight Committee, to address the gap identified by the auditor management letter and the Apex Proxy Advisors benchmarking report.
3. DOA Matrix Overhaul. Overhaul the parent-level Delegation of Authority Matrix and create a model subsidiary DOA matrix template suitable for adoption and customization by each of QIH's operating subsidiaries, with the objectives of rationalizing threshold levels, eliminating inconsistencies between parent and subsidiary authorities, and incorporating new authority categories reflective of QIH's current operations and risk profile.
4. Board Memorandum and Supporting Materials. Prepare a comprehensive board memorandum and supporting presentation materials summarizing the entire governance overhaul package for consideration and adoption at the regular board meeting scheduled for December 11, 2025.
5. Conforming Amendments. Draft conforming amendments to QIH's Corporate Governance Guidelines and Bylaws to reflect the revised committee structure, updated committee-appointment mechanics, and officer-authority provisions cross-referencing the revised DOA Matrix.
6. Delaware Law Analysis. Provide a detailed analysis of board delegation authority under the Delaware General Corporation Law ("DGCL"), specifically Sections 141(c) (relating to the powers of committees of the board) and 141(a) (relating to the general management authority of the board), addressing the permissible scope of delegation, non-delegable actions, and fiduciary-duty considerations in the context of the proposed governance changes.
7. NYSE Listing-Rule Compliance. Advise on compliance with the New York Stock Exchange listing rules applicable to committee composition and charter content, including Listed Company Manual Sections 303A.01 through 303A.14, as amended, with particular attention to independence requirements, audit committee financial-expert qualifications, compensation committee charter mandates, clawback policy requirements, and the 2024 amendments to the listing standards.
The engagement letter expressly excluded from scope any substantive tax advice, any securities-law work beyond the governance-related Form 8-K filing, any representation in connection with shareholder litigation or regulatory enforcement proceedings, and any direct representation of individual directors.
II. ENGAGEMENT TEAM
The following Calderwood & Harkness professionals were assigned to this engagement. All team members are identified below with their respective roles, practice-group affiliations, and standard hourly billing rates as set forth in the executed engagement letter.
Ms. Forsythe served as the Responsible Partner for the engagement and maintained overall supervisory responsibility for all client deliverables, including review of all legal memoranda, draft documents, and final/execution versions. Ms. Forsythe also led the committee workshops with the chairs of the Nominating & Corporate Governance Committee (October 17, 2025) and the Risk Committee (November 10, 2025), and presented the governance overhaul package to the full Board at the December 11, 2025 meeting alongside Mr. Okonkwo.
Mr. Bellamy served as the Billing Partner for the engagement and was responsible for overall engagement economics, billing review, and client relationship management. Mr. Bellamy participated in the kickoff meeting and the Audit Committee workshop (November 7, 2025), and contributed substantive input to the Delaware law memorandum based on his prior experience advising publicly traded holding companies on committee delegation issues.
Ms. Forbes, the author of this memorandum, served as the Lead Associate and was responsible for day-to-day engagement management, including preparation and coordination of all deliverables, supervision of the Working Associate, management of the engagement timeline, coordination with third-party advisors, and primary drafting of the committee charters, DOA Matrix documents, and board materials. Ms. Forbes also led the committee workshops with the chairs of the Compensation & Human Capital Committee (November 12, 2025) and the Investment Committee (November 14, 2025).
Mr. Johannsen served as the Working Associate and was responsible for initial document review, preparation of the gap analysis memoranda, research supporting the Delaware law memorandum and NYSE compliance analysis, drafting of the redline/comparison documents, and preparation of the conflict check memorandum. Mr. Johannsen also assisted with the preparation of the insurance regulatory implications memorandum and coordinated document-exchange logistics with the client and third-party advisors.
Other Professionals Consulted
In the course of this engagement, the Calderwood & Harkness team consulted or coordinated with the following external professionals:
• Prescott, Henley & Gage LLP ("PHG"), QIH's historical outside corporate counsel, was consulted informally with respect to the historical context of the original committee charters adopted in February 2016 and the subsequent June 2021 charter amendments. Partner Marissa L. Tavares of PHG provided background information on the genesis of the original governance framework and the rationale for certain structural decisions made at the time of the company's initial public offering. PHG was not formally engaged for this project, and no separate engagement letter or fee arrangement was established between Calderwood & Harkness and PHG. The consultation with Ms. Tavares was authorized by Mr. Okonkwo.
• Broadleaf Insurance Regulatory Consultants, LLC ("Broadleaf"), an independent insurance regulatory consulting firm, was retained separately by QIH's compliance team under the direction of Chief Compliance Officer Ivan D. Pruett to assist with state insurance regulatory filing mechanics arising from the governance overhaul. Managing Director Harold J. Emmerich of Broadleaf served as the primary contact. Calderwood & Harkness coordinated with Broadleaf on the substance and timing of holding company act filings required in Connecticut, Texas, and Ohio. The coordination was conducted pursuant to a joint-interest arrangement authorized by Mr. Okonkwo, under which C&H provided Broadleaf with copies of the final adopted governance documents and the insurance regulatory implications memorandum.
III. ENGAGEMENT TIMELINE — KEY MILESTONES
The following table sets forth the key milestones and deliverable dates for the engagement. All milestones have been completed as of the date of this memorandum.
The engagement was completed on schedule and within the originally contemplated timeline. No material delays were encountered. The iterative drafting process—initial drafts, committee workshops, revised drafts, and final versions—proceeded in accordance with the schedule established at the September 12, 2025 kickoff meeting. The only adjustment to the original timeline was a one-day extension of the board memorandum delivery from November 24 to November 25, 2025, to accommodate a final round of comments from CFO Patricia Sung-Hee Lam on the DOA threshold rationale section.
IV. DELIVERABLES PRODUCED
The engagement produced a total of thirty-four (34) documents, organized below by category. Each deliverable is identified by sequential number, title, date (where applicable), and a brief description of its content and purpose. All deliverables have been filed in the electronic engagement file under Engagement No. 1025-00005 in the firm's document management system, with the organizational structure mirroring the subsection headings below.
A. Analysis & Memoranda (7 Deliverables)
Deliverable 1 — Initial Gap Analysis Memorandum: Committee Charters (October 3, 2025)
This memorandum provided a systematic analysis of all five existing standing committee charters against the applicable requirements of the NYSE Listed Company Manual (Section 303A), the DGCL, SEC Rule 10D-1, and current governance best practices as informed by the Apex Proxy Advisors benchmarking report. The memorandum was organized on a committee-by-committee basis and identified the following key gaps and deficiencies:
• Audit Committee Charter: The existing charter, last amended June 14, 2021, did not include provisions for enterprise risk management ("ERM") oversight coordination, clawback-policy administration responsibilities required by SEC Rule 10D-1 and NYSE Rule 303A.14, or a formal annual self-evaluation process. Additionally, the charter's description of the Audit Committee's authority to retain independent advisors, while technically present, lacked the specificity and clarity expected under current best practices.
• Compensation & Human Capital Committee Charter: The existing charter, also last amended June 14, 2021, lacked an express provision authorizing the Committee to retain independent compensation consultants and outside advisors at the company's expense, which is a recommended best practice and is required under NYSE Rule 303A.05(c). The charter also did not address substantive human-capital-management oversight, including workforce strategy, diversity, equity, and inclusion ("DEI") initiatives, or talent-development programs, despite the growing expectation among institutional investors and proxy advisory firms that compensation committees assume explicit responsibility for these matters.
• Nominating & Corporate Governance Committee Charter: The existing charter, last amended March 20, 2019, did not include provisions for ESG or sustainability oversight, a director skills-matrix requirement, a formal shareholder-engagement protocol, or board-refreshment provisions (including director tenure limits and retirement policies).
• Risk Committee Charter: The existing charter, which had not been substantively updated since its original adoption on February 12, 2016, contained no insurance-specific risk categories (such as reserving risk, reinsurance risk, or catastrophe exposure risk), lacked coordination protocols with the Audit Committee and any potential technology oversight committee, and did not include an annual self-evaluation provision.
• Investment Committee Charter: The existing charter, also dating to the February 12, 2016 original adoption, contained investment-transaction thresholds—specifically, a $50 million single-issuer concentration limit and a $250 million aggregate portfolio-rebalancing threshold—that had not been adjusted despite a 46.4% increase in QIH's total invested assets from approximately $11.2 billion in 2016 to approximately $16.4 billion in 2024. The charter also lacked any reference to ESG integration in investment strategy or coordination with the Risk Committee on investment-portfolio risk.
Deliverable 2 — Initial Gap Analysis Memorandum: DOA Matrix (October 3, 2025)
This memorandum analyzed the existing parent-level DOA Matrix, which had last been comprehensively updated on October 6, 2017, with a single interim amendment on April 22, 2020 (which addressed claims-payment authorities in connection with COVID-19-related claim-surge management). The memorandum identified the following principal issues:
• Inconsistencies between parent-level and subsidiary-level authorities, with certain subsidiary officers exercising authority at levels not clearly authorized under the parent DOA Matrix or subsidiary-level board resolutions.
• The specific instance identified in the Garrett & Whitfield management letter in which Lone Star Specialty Insurance Company's executive team had been approving individual claims settlements at amounts up to $3.0 million against a board-approved subsidiary CEO claims-settlement authority of $1.0 million, without documented board ratification for the excess amounts.
• The absence of standalone authority categories for technology and IT spending, which had grown significantly as a proportion of QIH's annual operating expenditures since 2017 and warranted a dedicated line item in the DOA Matrix.
• Generally outdated threshold levels across most authority categories, reflecting QIH's 2016–2017 operational scale rather than its current size and complexity.
Deliverable 3 — NYSE Listing-Rule Compliance Analysis (October 24, 2025, delivered concurrent with first charter drafts)
This memorandum provided a comprehensive assessment of QIH's compliance with NYSE Listed Company Manual Sections 303A.01 through 303A.14, including the 2024 amendments to the listing standards. The analysis addressed committee independence requirements across all mandatory committees, financial-expert qualification requirements for the Audit Committee (with specific analysis of Dr. Lilian Fong-Archer's qualifications under SEC Regulation S-K, Item 407(d)(5)), charter content mandates for the Audit, Compensation, and Nominating & Governance Committees, mandatory self-evaluation provisions, and the clawback-policy requirements imposed by NYSE Rule 303A.14 implementing SEC Rule 10D-1. The memorandum concluded that, subject to adoption of the restated charters and related governance documents, QIH would be in full compliance with all applicable NYSE listing standards.
Deliverable 4 — Delaware Law Memorandum (November 18, 2025)
This memorandum provided a detailed analysis of the DGCL provisions governing board delegation authority, with primary focus on Sections 141(a) (general management authority of the board of directors), 141(c) (powers and authority of committees of the board), and 142 (officers and their authority). The memorandum addressed the following topics:
• The scope of permissible committee powers under DGCL § 141(c)(2), including the breadth of authority that may be delegated to a standing committee of the board and the fiduciary-duty standards applicable to committee members in the exercise of delegated authority.
• Non-delegable actions under Delaware law, including the power to amend the certificate of incorporation, adopt an agreement of merger or consolidation, recommend a dissolution, or amend the bylaws, as well as the DGCL's prohibition on committee action with respect to the declaration of dividends (unless expressly authorized in the certificate of incorporation or bylaws) and the issuance of stock (except within specific parameters established by the board).
• Fiduciary duties of care and loyalty in the delegation context, including the board's ongoing supervisory obligations and the standard of review applicable to the board's reliance on committee action.
• Specific client questions regarding the proposed increase in the M&A board-approval threshold from $10.0 million to $25.0 million, including an analysis of whether the higher threshold was consistent with the board's fiduciary obligations and Delaware case law on material corporate transactions. The memorandum concluded that the proposed threshold was within the range of reasonable business judgment, particularly in light of QIH's total asset base and the peer benchmarking data.
• Specific client questions regarding the proposed expansion of the CEO's individual claims-settlement authority, including an analysis of the board's ability to delegate claims-settlement decisions to officers and the appropriate scope of such delegation for a regulated insurance holding company.
Deliverable 5 — Peer Benchmarking Summary & Recommendations (October 17, 2025, delivered in advance of Nom/Gov Committee workshop)
This memorandum synthesized the data and findings from the Apex Proxy Advisors benchmarking report (based on a fourteen-company peer group of publicly traded insurance holding companies) with Calderwood & Harkness's independent legal analysis and governance best-practices recommendations. Key observations included:
• Eleven of fourteen peer companies had either a standalone technology/cybersecurity oversight committee or explicit charter provisions assigning technology and cybersecurity oversight to a named standing committee.
• Twelve of fourteen peer companies had comprehensively updated their DOA frameworks within the prior twenty-four months.
• The peer median CEO sole capital expenditure authority was $4.5 million, compared to QIH's then-current level of $2.0 million.
• All fourteen peer companies had formalized annual board and committee self-evaluation processes.
• Nine of fourteen peer companies had adopted director tenure limits (ranging from twelve to fifteen years) and/or mandatory retirement ages (ranging from seventy-two to seventy-six years).
Deliverable 6 — Insurance Regulatory Implications Memorandum (November 18, 2025, delivered concurrent with Delaware law memorandum)
This memorandum analyzed the state insurance holding company act requirements applicable to the governance changes in Connecticut, Texas, and Ohio—the domiciliary states of QIH's three regulated insurance subsidiaries. The analysis addressed:
• Connecticut: Under the Connecticut Insurance Holding Companies Act (Conn. Gen. Stat. § 38a-129 et seq.), Quorum P&C is required to file an amended Form B registration statement reflecting material changes in the governance and control structure of its ultimate controlling person. The memorandum concluded that the governance overhaul constituted a reportable change requiring an amended Form B filing, due on or before March 1, 2026 (i.e., within the next annual filing cycle).
• Texas: Under the Texas Insurance Holding Company System Regulatory Act (Tex. Ins. Code Chapter 823), Lone Star Specialty is required to provide informational notice to the Texas Department of Insurance of material changes in the holding company system, including changes to the governance structure of the ultimate controlling company. The memorandum concluded that an informational filing was due within thirty (30) days of the adoption date (i.e., by approximately January 10, 2026).
• Ohio: Under the Ohio Insurance Holding Company System Regulatory Act (Ohio Rev. Code § 3901.32 et seq.), Great Lakes Surety & Indemnity Co. is required to provide informational notice of material governance changes within thirty (30) days of adoption.
The memorandum was coordinated with Broadleaf Insurance Regulatory Consultants, LLC (Harold J. Emmerich, Managing Director), which was retained by QIH's compliance team to prepare and submit the actual regulatory filings. Calderwood & Harkness reviewed and commented on draft filing materials prepared by Broadleaf.
Deliverable 7 — Final Board Memorandum (December 1, 2025)
This comprehensive memorandum was prepared for presentation to the eleven-member Board of Directors in advance of the December 11, 2025 regular board meeting. The memorandum summarized the entire governance overhaul package, including:
• Background and triggers for the governance overhaul (auditor management letter observations, shareholder communications, peer benchmarking findings)
• Summary of each restated committee charter and the new Technology & Cybersecurity Oversight Committee charter, with a description of all material changes
• Summary of the revised DOA Matrix, including a table of all threshold changes with current levels, proposed levels, dollar and percentage changes, and peer-median comparisons
• Summary of the Amended & Restated Corporate Governance Guidelines
• Summary of the conforming bylaw amendments
• Delaware law analysis summary
• NYSE compliance assessment summary
• Insurance regulatory filing timeline and next steps
• Recommendation for Board adoption via omnibus resolution
The board memorandum was delivered in final form on December 1, 2025, via the transmittal letter described in Deliverable 30 below, and was circulated to all directors as part of the board materials package on December 3, 2025.
B. Restated / New Committee Charters — Execution Versions (6 Deliverables)
Deliverable 8 — Restated Charter: Audit Committee (Execution Version, December 1, 2025)
Chair: Dr. Lilian Fong-Archer
The restated Audit Committee charter incorporated the following material changes from the prior version dated June 14, 2021:
• Added enterprise risk management ("ERM") oversight provisions, including a requirement for at least quarterly reports from the Chief Audit Executive and coordination with the Risk Committee on ERM-related matters.
• Added clawback-policy administration responsibilities, establishing the Audit Committee as the body responsible for administering QIH's clawback policy adopted pursuant to SEC Rule 10D-1 and NYSE Rule 303A.14, including the authority to determine whether a financial restatement triggers a clawback obligation and to oversee the recovery of erroneously awarded compensation.
• Added a formal annual self-evaluation requirement, providing that the Committee shall conduct an annual evaluation of its performance and the adequacy of its charter, with results reported to the Board.
• Added a Risk Committee coordination protocol, formalizing the expectation that the Audit Committee Chair and the Risk Committee Chair shall meet at least quarterly to coordinate on overlapping risk-related matters.
• Updated independence and financial-expert requirements to conform to the current NYSE Section 303A requirements, including the 2024 amendments, and SEC Regulation S-K, Item 407(d)(5).
• Clarified and expanded the Committee's authority to retain independent advisors, including independent auditors, legal counsel, and other experts, at the company's expense, without the need for prior Board approval.
Deliverable 9 — Restated Charter: Compensation & Human Capital Committee (Execution Version, December 1, 2025)
Chair: Claudia M. Severin
The restated Compensation & Human Capital Committee charter incorporated the following material changes from the prior version dated June 14, 2021:
• Added an express provision authorizing the Committee to retain independent compensation consultants and other outside advisors at the company's expense, and establishing the Committee's direct responsibility for the appointment, compensation, and oversight of any such consultant or advisor, consistent with NYSE Rule 303A.05(c) and SEC Rule 10C-1.
• Added substantive human-capital-management oversight provisions, expanding the Committee's responsibilities beyond executive compensation to encompass workforce strategy, diversity, equity, and inclusion ("DEI") initiatives, talent development and succession planning for positions below the senior executive level, employee engagement, and organizational culture.
• Added a formal annual self-evaluation requirement consistent with the provision added to the Audit Committee charter.
• Updated the Committee's role in overseeing the clawback policy to ensure appropriate coordination with the Audit Committee, which was designated as the primary administering body.
Deliverable 10 — Restated Charter: Nominating & Corporate Governance Committee (Execution Version, December 1, 2025)
Chair: Arthur J. Pennington (Lead Independent Director)
The restated Nominating & Corporate Governance Committee charter incorporated the following material changes from the prior version dated March 20, 2019:
• Added ESG and sustainability oversight provisions, assigning the Committee responsibility for overseeing the company's environmental, social, and governance strategy, reporting, and stakeholder engagement on ESG matters.
• Added a director skills-matrix requirement, providing that the Committee shall maintain a skills and experience matrix for the Board and use it as a tool in the director nomination and evaluation process.
• Added a shareholder-engagement protocol, providing that the Lead Independent Director and the Nominating & Corporate Governance Committee Chair shall be available for direct engagement with holders of three percent (3%) or more of QIH's outstanding shares on governance-related matters, subject to appropriate notice and coordination through the General Counsel.
• Added board-refreshment provisions, including a recommendation framework for director tenure limits and mandatory retirement, with the specific parameters to be set forth in the Amended & Restated Corporate Governance Guidelines.
Deliverable 11 — Restated Charter: Risk Committee (Execution Version, December 1, 2025)
Chair: Raymond T. Huerta
The restated Risk Committee charter represented the first substantive update to this charter since its original adoption on February 12, 2016, and incorporated the following material changes:
• Added insurance-specific risk categories, including explicit provisions for oversight of reserving risk, reinsurance risk, catastrophe exposure risk, underwriting risk, and claims-settlement practices across QIH's regulated insurance subsidiaries.
• Added coordination protocols with the Audit Committee (on ERM and internal-control matters) and the new Technology & Cybersecurity Oversight Committee (on technology-related risks), formalizing the expectation that the respective committee chairs shall meet at least quarterly to discuss overlapping areas of responsibility.
• Added a formal annual self-evaluation requirement consistent with the provisions in the other restated charters.
• Expanded the Committee's oversight of the enterprise risk management framework, including the requirement for at least semi-annual presentations by the Chief Risk Officer and/or Chief Compliance Officer to the full Committee.
• Added provisions for oversight of emerging and strategic risks, including climate-related financial risk, regulatory change risk, and geopolitical risk.
Deliverable 12 — Restated Charter: Investment Committee (Execution Version, December 1, 2025)
Chair: Jonathan K. Whitmore
The restated Investment Committee charter incorporated the following material changes from the prior version dated February 12, 2016:
• Updated the single-issuer concentration threshold from $50 million to $75 million, reflecting the growth in QIH's total invested-asset base from approximately $11.2 billion in 2016 to approximately $16.4 billion in 2024 (a 46.4% increase) and aligning the threshold with the peer median.
• Added ESG integration in investment strategy, requiring the Committee to consider environmental, social, and governance factors in its oversight of investment policy and portfolio construction, consistent with the company's overall ESG strategy as overseen by the Nominating & Corporate Governance Committee.
• Added a Risk Committee coordination provision, requiring the Investment Committee to coordinate with the Risk Committee on investment-portfolio risk, including credit risk, interest-rate risk, liquidity risk, and concentration risk.
• Added a formal annual self-evaluation requirement.
Deliverable 13 — New Charter: Technology & Cybersecurity Oversight Committee (Execution Version, December 1, 2025)
Proposed Chair: Priya Narasimhan
Members: Priya Narasimhan, Victor L. Andrade, Camille R. DuPont (non-voting advisory member)
The new Technology & Cybersecurity Oversight Committee charter was drafted from the ground up to address the gap identified by the Garrett & Whitfield management letter and the Apex Proxy Advisors benchmarking report. The charter established the following framework:
• Composition: A minimum of three (3) independent directors, at least one of whom shall possess cybersecurity or technology expertise as determined by the Board. The charter also authorized the appointment of non-voting advisory members (such as Ms. DuPont, who serves as a management director with technology-industry background) to provide subject-matter expertise without compromising the Committee's independence.
• Scope of Oversight: The Committee's charter encompasses oversight of the company's cybersecurity program and risk posture; information technology strategy and architecture; data privacy and data-governance practices; insurtech initiatives and digital transformation strategy, including the activities of Vantage Digital Insurance Solutions, Inc.; artificial intelligence governance and ethics, including AI-driven underwriting and claims models; third-party technology risk (including vendor cybersecurity diligence and cloud-services oversight); and incident response and breach preparedness, including coordination with the company's incident-response team, external forensic consultants, and law enforcement.
• Reporting: Quarterly reports to the full Board on cybersecurity risk posture, material technology initiatives, and significant incidents. Annual comprehensive report on the state of the company's cybersecurity program, including assessment of the program's maturity relative to industry frameworks (NIST CSF 2.0, ISO 27001).
• Coordination: Formal coordination protocols with the Risk Committee (on technology-related enterprise risks) and the Audit Committee (on technology-related internal controls and financial-reporting systems).
• Annual Self-Evaluation: The Committee shall conduct an annual self-evaluation consistent with the process established for all standing committees.
C. Redline / Comparison Documents (5 Deliverables)
The following redline comparison documents were prepared to facilitate the Board's review by clearly identifying all changes between the existing charter versions and the proposed restated versions:
14. Redline — Audit Committee Charter: Comparison of the June 14, 2021 version against the proposed restated version, with tracked changes (insertions, deletions, and revisions) shown in standard redline format.
15. Redline — Compensation & Human Capital Committee Charter: Comparison of the June 14, 2021 version against the proposed restated version.
16. Redline — Nominating & Corporate Governance Committee Charter: Comparison of the March 20, 2019 version against the proposed restated version.
17. Redline — Risk Committee Charter: Comparison of the February 12, 2016 original version against the proposed restated version. This redline reflected the most extensive changes of any of the five restated charters, given that the Risk Committee charter had not been substantively updated since its original adoption.
18. Redline — Investment Committee Charter: Comparison of the February 12, 2016 original version against the proposed restated version.
All redline documents were prepared using document-comparison software and reviewed by Ms. Forbes and Mr. Johannsen for accuracy and completeness prior to delivery to the client.
D. Delegation of Authority Documents (3 Deliverables)
Deliverable 19 — Revised DOA Matrix: Parent Level (Execution Version, December 1, 2025)
The revised parent-level DOA Matrix was organized by authority category and reflected all proposed threshold increases. The matrix was structured in a multi-column format identifying, for each authority category: (i) the authority description; (ii) the prior threshold; (iii) the revised threshold; (iv) the designated authority holder (Board, committee, CEO, CFO, GC, or specified officer); (v) any required secondary approvals or notifications; and (vi) cross-references to the applicable committee charter or governing document. The following table summarizes the principal threshold changes reflected in the revised DOA Matrix:
The revised DOA Matrix was developed in consultation with CFO Patricia Sung-Hee Lam (who provided input on financial parameters, peer comparisons, and operational requirements) and General Counsel Dennis R. Okonkwo (who provided input on legal-spend authorities, litigation settlement thresholds, and officer-hiring parameters). The threshold revisions were informed by the Apex Proxy Advisors benchmarking data, the Delaware law analysis, and the practical experience of QIH's management team.
Deliverable 20 — Model Subsidiary DOA Matrix Template (Execution Version, December 1, 2025)
The model subsidiary DOA matrix template was designed for adoption and customization by each of QIH's five principal operating subsidiaries: Quorum P&C, Lone Star Specialty, Great Lakes Surety, Quorum MGA Services, and Vantage Digital. The template mirrored the organizational structure of the revised parent-level DOA Matrix but included placeholder thresholds calibrated to the scale and risk profile of each subsidiary category (regulated insurance company, managing general agent, and fintech subsidiary). The template also included cross-references to the parent-level DOA Matrix to ensure consistency and to delineate the circumstances under which subsidiary-level actions require escalation to the parent-level authority holder.
Deliverable 21 — DOA Matrix Comparison: Current vs. Proposed (November 5, 2025, updated December 1, 2025)
This document was formatted as a side-by-side comparison spreadsheet with five columns for each authority category: (i) current threshold; (ii) proposed threshold; (iii) dollar change and percentage change; (iv) peer median (from Apex Proxy Advisors benchmarking data where available); and (v) rationale for the proposed change. This document served as a key reference tool during the committee workshops and was included in the board materials package.
E. Governance Guidelines & Bylaw Amendments (4 Deliverables)
Deliverable 22 — Amended & Restated Corporate Governance Guidelines (Execution Version, December 1, 2025)
The Amended & Restated Corporate Governance Guidelines incorporated the following material changes:
• Mandatory Retirement Age: Established a mandatory retirement age of seventy-five (75) for independent directors. No current director is affected by this provision; the oldest current independent director is seventy-one (71).
• Tenure Limit: Established a fifteen (15)-year tenure limit for independent directors, with the expectation that the Nominating & Corporate Governance Committee will manage board refreshment to ensure that no independent director serves beyond fifteen consecutive years. The limit applies prospectively; tenure accrued prior to adoption is counted toward the limit.
• Director Overboarding Policy: Established a policy limiting independent directors to service on no more than four (4) public-company boards (including QIH) and limiting the CEO to service on no more than two (2) total public-company boards (including QIH).
• Majority Voting Standard: Adopted a majority voting standard for uncontested director elections, replacing the prior plurality voting standard. Under the new standard, a director nominee in an uncontested election must receive more votes cast "for" than "against" to be elected. Any incumbent director who fails to receive a majority of votes cast shall tender a resignation, which the Nominating & Corporate Governance Committee shall consider and recommend whether to accept.
• Shareholder Engagement Protocol: Formalized a shareholder-engagement protocol providing that the Lead Independent Director and the Chair of the Nominating & Corporate Governance Committee shall be available for direct engagement with significant shareholders on governance-related matters.
• Annual Self-Evaluation: Formalized the annual board and committee self-evaluation process, including the expectation that the Nominating & Corporate Governance Committee will oversee the process and that results will be discussed at the Board level.
Deliverable 23 — Redline: Corporate Governance Guidelines (Current vs. Amended)
Standard tracked-changes comparison document showing all changes between the then-current Corporate Governance Guidelines and the proposed Amended & Restated version.
Deliverable 24 — Bylaw Amendment Resolution (Execution Version, December 1, 2025)
The bylaw amendment resolution addressed conforming changes to three sections of QIH's Bylaws:
• Article III, Section 3.3 (Standing Committees): Updated to reference six standing committees (from five), adding the Technology & Cybersecurity Oversight Committee to the enumerated list.
• Article III, Section 3.4 (Committee Appointment): Revised the committee-appointment mechanics to provide for annual appointment of committee members and chairs at the first meeting of the Board following the annual meeting of shareholders, with the Board retaining authority to fill vacancies and make interim changes at any time.
• Article IV, Section 4.2 (Officer Authority): Revised to include a cross-reference to the DOA Matrix as the governing document for officer authority thresholds, providing that officers shall exercise authority in accordance with the parameters established in the DOA Matrix as adopted and amended by the Board from time to time.
Deliverable 25 — Redline: Bylaws, Articles III and IV (Current vs. Amended)