[sheet: Cover]

Field	Value
Document Title	Budget and Staffing Plan
Matter Number	1025-00005
Matter Name	Quorum Insurance Holdings Corp. — Pre-Suit Reinsurance Recoverable Dispute (Pinnacle Atlantic Reinsurance Ltd.)
Client	Quorum Insurance Holdings Corp. (Nasdaq: QIHC)
Client Subsidiary / Cedent	Quorum Casualty & Surety Company (NAIC No. 24891)
Counterparty	Pinnacle Atlantic Reinsurance Ltd.
Opposing Counsel	Hargrove, Fitch & Calloway LLP
Treaty at Issue	PA-QCS-2019-EXL-0044 (Aggregate Excess-of-Loss, Casualty Lines)
Amount in Dispute	$78,400,000 reinsurance recoverable; $91,000,000 total demand (incl. $12,600,000 interest)
Governing Law	New York
Potential Forum	Supreme Court of the State of New York, New York County, Commercial Division / ARIAS-U.S. Arbitration (Treaty Article 22)
Responsible Partner	Douglas Carmichael
Billing Partner	Francesca Morano
Lead Associate	Jeffrey Park
Working Associate	Yuki Nakamura
Engagement Opened	March 2, 2026
Prepared By	Francesca Morano, Billing Partner, Calderwood & Harkness LLP
Firm Address	One Liberty Plaza, 55th Floor, New York, NY 10006
Client General Counsel	Rachel Sondergaard
Status	Prospective (Pre-Suit)
Date Prepared	March 2026
Classification	Attorney-Client Privileged / Work Product

[sheet: Billing Rates]

Timekeeper	Role	Title	Year / Level	Standard Rate ($/hr)	Discount (%)	Discounted Rate ($/hr)
Douglas Carmichael	Responsible Partner	Partner, Litigation (General)	Partner	1736.84	5%	1650
Francesca Morano	Billing Partner	Partner, Litigation (General)	Partner	1631.58	5%	1550
Jeffrey Park	Lead Associate	Senior Associate, Litigation (General)	7th Year	1105.26	5%	1050
Yuki Nakamura	Working Associate	Associate, Litigation (General)	4th Year	868.42	5%	825
Notes:	Rates reflect 5% discount per long-standing client relationship. Billing arrangement is monthly invoicing, net-30 payment terms.

[sheet: Phase Summary]

Phase No.	Phase Name	Description	Estimated Start	Estimated End	Duration	Budget Low ($)	Budget High ($)	% of Total Budget Low	% of Total Budget High
1	Strategy Assessment & Pre-Litigation	Engagement kickoff; factual investigation; treaty analysis; assessment of Pinnacle Atlantic's four grounds (late notice, IBNR allocation, follow-the-fortunes, premium reporting); initial case assessment memo; forum analysis (arbitration vs. litigation); Board Audit Committee presentation; regulatory disclosure analysis	March 2026	April 2026	~2 months	450000	625000	14.1%	13.0%
2	Pre-Litigation / Arbitration Initiation	Response to pre-suit demand; demand to arbitrate (Treaty Article 22, ARIAS-U.S. Rules); mediation proposal; draft answer, counterclaim, and motion to compel arbitration; settlement authority memo; counterparty correspondence	May 2026	July 2026	~3 months	375000	550000	11.7%	11.5%
3	Discovery	Document requests, interrogatories, third-party subpoena to Broadreach Intermediaries Inc.; document review and production; depositions (Conrad Hesse, Lorraine Metcalf, Jamie Castellano, Dr. Stephen Tanaka); e-discovery management	August 2026	February 2027	~7 months	950000	1450000	29.7%	30.2%
4	Expert Reports	Retention and management of independent actuarial expert (IBNR allocation), reinsurance industry practices expert (notice customs, follow-the-fortunes, settlement standards), and potential damages expert; expert report preparation and rebuttal	March 2027	June 2027	~4 months	425000	625000	13.3%	13.0%
5	Hearing / Trial Preparation	Pre-hearing/pre-trial motions; witness preparation; exhibit preparation; pre-hearing briefs; mock hearing/trial; final settlement evaluation	July 2027	September 2027	~3 months	550000	800000	17.2%	16.7%
6	Hearing / Trial	Arbitration hearing or trial in NY Supreme Court, Commercial Division; post-hearing/post-trial briefing; award/judgment	October 2027	December 2027	~2–3 months	450000	750000	14.1%	15.6%
TOTAL	March 2026	December 2027	~22 months	3200000	4800000	100.0%	100.0%

[sheet: Phase 1 Detail]

Task / Workstream	Timekeeper	Rate ($/hr)	Est. Hours Low	Est. Hours High	Est. Cost Low ($)	Est. Cost High ($)	Notes
Engagement Kickoff & Document Collection	Douglas Carmichael	1650	10	15	16500	24750	Initial calls with Rachel Sondergaard, Tobias Engström, Diana Kessler-Hoff; coordinate document collection
Engagement Kickoff & Document Collection	Jeffrey Park	1050	20	30	21000	31500	Collect and organize Treaty, endorsements, Broadreach transmittals, Velthorn actuarial certificates, claims files (Meridian Docks CGL-2020-09844, Veridian PL-2021-15327), reservation of rights letter, demand letter
Engagement Kickoff & Document Collection	Yuki Nakamura	825	15	25	12375	20625	Document indexing, conflicts check memo, litigation hold notice and acknowledgment forms
Subtotal — Engagement Kickoff & Document Collection	45	70	49875	76875
Treaty Interpretation Analysis (Articles 3, 5, 7, 9, 11, 22)	Douglas Carmichael	1650	5	8	8250	13200	Review and supervision
Treaty Interpretation Analysis (Articles 3, 5, 7, 9, 11, 22)	Jeffrey Park	1050	30	40	31500	42000	Detailed analysis of key treaty provisions under NY law
Treaty Interpretation Analysis (Articles 3, 5, 7, 9, 11, 22)	Yuki Nakamura	825	25	35	20625	28875	Legal research, drafting of treaty interpretation memorandum
Subtotal — Treaty Interpretation Analysis	60	83	60375	84075
Late Notice Defense Analysis (Article 7 / Meridian Docks)	Jeffrey Park	1050	20	25	21000	26250	Analysis of 14-month, 7-day notice gap; NY prejudice-based late-notice law; Article 7 individual $1M threshold defense
Late Notice Defense Analysis (Article 7 / Meridian Docks)	Yuki Nakamura	825	15	20	12375	16500	Case law research and drafting
Subtotal — Late Notice Defense Analysis	35	45	33375	42750
IBNR Allocation Analysis (Article 5 / $22.3M dispute)	Jeffrey Park	1050	10	15	10500	15750	Review of Velthorn actuarial work; coordination with Dr. Stephen Tanaka
IBNR Allocation Analysis (Article 5 / $22.3M dispute)	Yuki Nakamura	825	20	30	16500	24750	Analysis of Article 5.2 'losses incurred' definition; Velthorn methodology review; model TY 2022 ceded loss reduction from $69.7M to $47.4M if IBNR reallocated
Subtotal — IBNR Allocation Analysis	30	45	27000	40500
Follow-the-Fortunes Analysis (Article 11 / Veridian E&O cluster)	Jeffrey Park	1050	15	20	15750	21000	Analyze $34.5M settlement (A: $14.2M, B: $12.8M, C: $7.5M); QC&S net retained $26.1M; bad faith exception standard
Follow-the-Fortunes Analysis (Article 11 / Veridian E&O cluster)	Yuki Nakamura	825	10	15	8250	12375	Legal research and drafting
Subtotal — Follow-the-Fortunes Analysis	25	35	24000	33375
Premium Reporting & Termination Analysis (Article 3)	Yuki Nakamura	825	10	15	8250	12375	Analyze $6.8M ceded premium gap ($38.4M vs. $45.2M); Article 3.4 run-off portfolio transfer exclusion; $2,856,000 alleged underpayment at 42% rate
Subtotal — Premium Reporting & Termination Analysis	10	15	8250	12375
Arbitration vs. Litigation Forum Analysis (Article 22)	Douglas Carmichael	1650	5	8	8250	13200	Strategic assessment and review
Arbitration vs. Litigation Forum Analysis (Article 22)	Jeffrey Park	1050	15	20	15750	21000	ARIAS-U.S. Rules; HFC position that Article 22 inapplicable; NY CPLR Article 75; Federal Arbitration Act
Subtotal — Forum Analysis	20	28	24000	34200
Initial Case Assessment Memorandum	Douglas Carmichael	1650	15	20	24750	33000	Comprehensive assessment of all four grounds; risk evaluation ($0 to $91M exposure range); strategic recommendations
Initial Case Assessment Memorandum	Jeffrey Park	1050	20	25	21000	26250	Drafting and analysis

Subtotal — Initial Case Assessment Memorandum	35	45	45750	59250
Damages & Exposure Summary	Jeffrey Park	1050	10	15	10500	15750	Best/likely/worst case financial modeling; statutory surplus impact ($1.42B baseline, $1.1B covenant); GAAP after-tax impact ($61.936M if full write-off)
Damages & Exposure Summary	Yuki Nakamura	825	8	12	6600	9900	Spreadsheet preparation; covenant headroom analysis ($320M current, $241.6M if write-off)
Subtotal — Damages & Exposure Summary	18	27	17100	25650
Board Audit Committee Presentation	Douglas Carmichael	1650	8	12	13200	19800	Presentation to QIH Audit Committee; dispute summary, exposure, strategy, budget
Board Audit Committee Presentation	Francesca Morano	1550	5	8	7750	12400	Budget and financial impact sections
Board Audit Committee Presentation	Jeffrey Park	1050	8	12	8400	12600	Drafting
Subtotal — Board Audit Committee Presentation	21	32	29350	44800
Regulatory Disclosure Analysis (SEC ASC 450, NYDFS, Cartwright credit agreement)	Francesca Morano	1550	8	12	12400	18600	SEC 10-Q/10-K contingency footnote; NYDFS notification; Cartwright $750M RCF covenant reporting
Regulatory Disclosure Analysis	Yuki Nakamura	825	10	15	8250	12375	Research and drafting; coordination with Harmon & Whitfield LLP and Meridian Whitcomb & Co. LLP
Subtotal — Regulatory Disclosure Analysis	18	27	20650	30975
Timeline & Chronology Preparation	Yuki Nakamura	825	8	12	6600	9900	Chronological fact compilation from Treaty inception (July 1, 2019) through engagement opening (March 2, 2026)
Subtotal — Timeline & Chronology Preparation	8	12	6600	9900
Phase 1 Partner Supervision & Client Communication	Douglas Carmichael	1650	10	15	16500	24750	Ongoing client communication with Rachel Sondergaard and QIH leadership
Phase 1 Partner Supervision & Client Communication	Francesca Morano	1550	5	8	7750	12400	Billing oversight and client coordination
Subtotal — Partner Supervision & Client Communication	15	23	24250	37150
PHASE 1 TOTAL	340	487	450575	631875	Budget range: $450,000 – $625,000

[sheet: Phase 2 Detail]

Task / Workstream	Timekeeper	Rate ($/hr)	Est. Hours Low	Est. Hours High	Est. Cost Low ($)	Est. Cost High ($)	Notes
Response Letter to Pinnacle Atlantic Pre-Suit Demand (to HFC / Nathaniel R. Calloway III)	Douglas Carmichael	1650	8	12	13200	19800	Reject all four grounds; assert Treaty Article 22 arbitration; reserve rights
Response Letter to Pinnacle Atlantic Pre-Suit Demand	Jeffrey Park	1050	12	18	12600	18900	Drafting
Subtotal — Response Letter	20	30	25800	38700
Demand to Arbitrate Letter (ARIAS-U.S. Rules)	Jeffrey Park	1050	8	12	8400	12600	Formal invocation of Treaty Article 22; request counterparty arbitrator appointment
Subtotal — Demand to Arbitrate	8	12	8400	12600
Mediation Proposal Letter	Douglas Carmichael	1650	3	5	4950	8250	Propose voluntary mediation as preliminary step
Subtotal — Mediation Proposal	3	5	4950	8250
Settlement Authority Memorandum (to QIH Board Audit Committee)	Douglas Carmichael	1650	10	15	16500	24750	Recommended settlement parameters; risk-adjusted exposure; litigation cost estimate ($3.2M–$4.8M)
Settlement Authority Memorandum	Francesca Morano	1550	8	12	12400	18600	Financial impact analysis; covenant compliance
Settlement Authority Memorandum	Jeffrey Park	1050	10	15	10500	15750	Drafting and analysis
Subtotal — Settlement Authority Memorandum	28	42	39400	59100
Draft Verified Answer & Affirmative Defenses	Jeffrey Park	1050	25	35	26250	36750	Deny claims; assert compliance, timely notice, proper IBNR allocation, follow-the-fortunes, waiver by payment, mandatory arbitration
Draft Verified Answer & Affirmative Defenses	Yuki Nakamura	825	20	30	16500	24750	Research and drafting
Subtotal — Verified Answer & Affirmative Defenses	45	65	42750	61500
Draft Counterclaim (Declaratory Judgment & Breach of Treaty)	Jeffrey Park	1050	15	20	15750	21000	Confirm validity of $78.4M cessions; damages for wrongful demand
Draft Counterclaim	Yuki Nakamura	825	12	18	9900	14850	Drafting
Subtotal — Counterclaim	27	38	25650	35850
Draft Motion to Compel Arbitration & Stay Litigation	Jeffrey Park	1050	20	28	21000	29400	Motion papers and memorandum of law; NY CPLR Article 75; FAA
Draft Motion to Compel Arbitration & Stay Litigation	Yuki Nakamura	825	18	25	14850	20625	Legal research and drafting
Subtotal — Motion to Compel Arbitration	38	53	35850	50025
Draft Affidavits (Tobias Engström, Diana Kessler-Hoff)	Jeffrey Park	1050	15	20	15750	21000	Fact witness affidavits supporting motion
Draft Affidavits	Yuki Nakamura	825	10	15	8250	12375	Drafting
Subtotal — Affidavits	25	35	24000	33375
Counterparty Correspondence Log Maintenance	Yuki Nakamura	825	5	8	4125	6600	Track all communications with HFC / Pinnacle Atlantic

Subtotal — Correspondence Log	5	8	4125	6600
Phase 2 Partner Supervision & Client Communication	Douglas Carmichael	1650	12	18	19800	29700	Strategy calls, client updates
Phase 2 Partner Supervision & Client Communication	Francesca Morano	1550	5	8	7750	12400	Billing and budget oversight
Subtotal — Partner Supervision & Client Communication	17	26	27550	42100
PHASE 2 TOTAL	216	314	238475	348100	Budget range: $375,000 – $550,000

[sheet: Phase 3 Detail]

Task / Workstream	Timekeeper	Rate ($/hr)	Est. Hours Low	Est. Hours High	Est. Cost Low ($)	Est. Cost High ($)	Notes
Draft Document Requests (First Set) to Pinnacle Atlantic	Yuki Nakamura	825	15	20	12375	16500	Treaty files, internal analyses, actuarial work papers, Broadreach correspondence, underwriting files for TY 2021–2023
Draft Interrogatories (First Set) to Pinnacle Atlantic	Yuki Nakamura	825	12	18	9900	14850	Factual/actuarial bases for four grounds; $12.6M interest calculation; Article 22 inapplicability basis
Draft Third-Party Subpoena to Broadreach Intermediaries Inc.	Yuki Nakamura	825	5	8	4125	6600	Treaty placement records, slips, cover notes, billing transmittals; attn: Jamie Castellano
Subtotal — Written discovery Propounded	32	46	26400	37950
Document Review & Production (QC&S documents)	Francesca Morano	1550	10	15	15500	23250	Privilege review oversight
Document Review & Production (QC&S documents)	Jeffrey Park	1050	60	90	63000	94500	Review claims files, actuarial records, reinsurance correspondence
Document Review & Production (QC&S documents)	Yuki Nakamura	825	120	180	99000	148500	Primary document review
Subtotal — Document Review & Production (QC&S)	190	285	177500	266250
Review Pinnacle Atlantic's Document Production	Jeffrey Park	1050	50	80	52500	84000	Analyze counterparty documents
Review Pinnacle Atlantic's Document Production	Yuki Nakamura	825	80	120	66000	99000	Review and catalogue
Subtotal — Review Counterparty Production	130	200	118500	183000
Deposition Preparation — Conrad Hesse (SVP, Treaty Disputes, Pinnacle Atlantic)	Douglas Carmichael	1650	10	15	16500	24750	Strategy and outline review
Deposition Preparation — Conrad Hesse	Jeffrey Park	1050	25	35	26250	36750	Outline preparation and conduct of deposition
Deposition — Conrad Hesse	Jeffrey Park	1050	8	10	8400	10500	Day-of deposition (1 day)
Deposition — Lorraine Metcalf (Chief Claims Officer, Pinnacle Atlantic)	Jeffrey Park	1050	20	30	21000	31500	Preparation and conduct
Deposition — Jamie Castellano (Account Executive, Broadreach)	Jeffrey Park	1050	15	22	15750	23100	Preparation and conduct; intermediary role, notice transmittals
Deposition — Dr. Stephen Tanaka (Principal Actuary, Velthorn)	Jeffrey Park	1050	15	20	15750	21000	Preparation and conduct; IBNR allocation methodology
Deposition Support	Yuki Nakamura	825	40	60	33000	49500	Deposition preparation binders, real-time support, summaries
Subtotal — Depositions	133	192	136650	197100
E-discovery Management & Vendor Coordination	Yuki Nakamura	825	20	30	16500	24750	Platform management, search term development, TAR review
Subtotal — E-discovery Management	20	30	16500	24750
Respond to Pinnacle Atlantic discovery Requests	Jeffrey Park	1050	30	45	31500	47250	Objections, responses, privilege log
Respond to Pinnacle Atlantic discovery Requests	Yuki Nakamura	825	30	45	24750	37125	Drafting, privilege log compilation
Subtotal — Respond to Counterparty discovery	60	90	56250	84375

Phase 3 Partner Supervision	Douglas Carmichael	1650	20	30	33000	49500	Ongoing strategy, deposition oversight
Phase 3 Partner Supervision	Francesca Morano	1550	8	12	12400	18600	Budget management
Subtotal — Partner Supervision	28	42	45400	68100
PHASE 3 TOTAL	593	885	577200	861525	Budget range: $950,000 – $1,450,000 (inclusive of disbursement allocation). E-discovery vendor costs estimated separately at $75,000–$150,000.

[sheet: Cover]
Field | Value
Document Title | Budget and Staffing Plan
Matter Number | 1025-00005
Matter Name | Quorum Insurance Holdings Corp. — Pre-Suit Reinsurance Recoverable Dispute (Pinnacle Atlantic Reinsurance Ltd.)
Client | Quorum Insurance Holdings Corp. (Nasdaq: QIHC)
Client Subsidiary / Cedent | Quorum Casualty & Surety Company (NAIC No. 24891)
Counterparty | Pinnacle Atlantic Reinsurance Ltd.
Opposing Counsel | Hargrove, Fitch & Calloway LLP
Treaty at Issue | PA-QCS-2019-EXL-0044 (Aggregate Excess-of-Loss, Casualty Lines)
Amount in Dispute | $78,400,000 reinsurance recoverable; $91,000,000 total demand (incl. $12,600,000 interest)
Governing Law | New York
Potential Forum | Supreme Court of the State of New York, New York County, Commercial Division / ARIAS-U.S. Arbitration (Treaty Article 22)
Responsible Partner | Douglas Carmichael
Billing Partner | Francesca Morano
Lead Associate | Jeffrey Park
Working Associate | Yuki Nakamura
Engagement Opened | March 2, 2026
Prepared By | Francesca Morano, Billing Partner, Calderwood & Harkness LLP
Firm Address | One Liberty Plaza, 55th Floor, New York, NY 10006
Client General Counsel | Rachel Sondergaard
Status | Prospective (Pre-Suit)
Date Prepared | March 2026
Classification | Attorney-Client Privileged / Work Product
[sheet: Billing Rates]
Timekeeper | Role | Title | Year / Level | Standard Rate ($/hr) | Discount (%) | Discounted Rate ($/hr)
Douglas Carmichael | Responsible Partner | Partner, Litigation (General) | Partner | 1736.84 | 5% | 1650
Francesca Morano | Billing Partner | Partner, Litigation (General) | Partner | 1631.58 | 5% | 1550
Jeffrey Park | Lead Associate | Senior Associate, Litigation (General) | 7th Year | 1105.26 | 5% | 1050
Yuki Nakamura | Working Associate | Associate, Litigation (General) | 4th Year | 868.42 | 5% | 825
Notes: | Rates reflect 5% discount per long-standing client relationship. Billing arrangement is monthly invoicing, net-30 payment terms.
[sheet: Phase Summary]
Phase No. | Phase Name | Description | Estimated Start | Estimated End | Duration | Budget Low ($) | Budget High ($) | % of Total Budget Low | % of Total Budget High
1 | Strategy Assessment & Pre-Litigation | Engagement kickoff; factual investigation; treaty analysis; assessment of Pinnacle Atlantic's four grounds (late notice, IBNR allocation, follow-the-fortunes, premium reporting); initial case assessment memo; forum analysis (arbitration vs. litigation); Board Audit Committee presentation; regulatory disclosure analysis | March 2026 | April 2026 | ~2 months | 450000 | 625000 | 14.1% | 13.0%
2 | Pre-Litigation / Arbitration Initiation | Response to pre-suit demand; demand to arbitrate (Treaty Article 22, ARIAS-U.S. Rules); mediation proposal; draft answer, counterclaim, and motion to compel arbitration; settlement authority memo; counterparty correspondence | May 2026 | July 2026 | ~3 months | 375000 | 550000 | 11.7% | 11.5%
3 | Discovery | Document requests, interrogatories, third-party subpoena to Broadreach Intermediaries Inc.; document review and production; depositions (Conrad Hesse, Lorraine Metcalf, Jamie Castellano, Dr. Stephen Tanaka); e-discovery management | August 2026 | February 2027 | ~7 months | 950000 | 1450000 | 29.7% | 30.2%
4 | Expert Reports | Retention and management of independent actuarial expert (IBNR allocation), reinsurance industry practices expert (notice customs, follow-the-fortunes, settlement standards), and potential damages expert; expert report preparation and rebuttal | March 2027 | June 2027 | ~4 months | 425000 | 625000 | 13.3% | 13.0%
5 | Hearing / Trial Preparation | Pre-hearing/pre-trial motions; witness preparation; exhibit preparation; pre-hearing briefs; mock hearing/trial; final settlement evaluation | July 2027 | September 2027 | ~3 months | 550000 | 800000 | 17.2% | 16.7%
6 | Hearing / Trial | Arbitration hearing or trial in NY Supreme Court, Commercial Division; post-hearing/post-trial briefing; award/judgment | October 2027 | December 2027 | ~2–3 months | 450000 | 750000 | 14.1% | 15.6%
TOTAL | March 2026 | December 2027 | ~22 months | 3200000 | 4800000 | 100.0% | 100.0%
[sheet: Phase 1 Detail]
Task / Workstream | Timekeeper | Rate ($/hr) | Est. Hours Low | Est. Hours High | Est. Cost Low ($) | Est. Cost High ($) | Notes
Engagement Kickoff & Document Collection | Douglas Carmichael | 1650 | 10 | 15 | 16500 | 24750 | Initial calls with Rachel Sondergaard, Tobias Engström, Diana Kessler-Hoff; coordinate document collection
Engagement Kickoff & Document Collection | Jeffrey Park | 1050 | 20 | 30 | 21000 | 31500 | Collect and organize Treaty, endorsements, Broadreach transmittals, Velthorn actuarial certificates, claims files (Meridian Docks CGL-2020-09844, Veridian PL-2021-15327), reservation of rights letter, demand letter
Engagement Kickoff & Document Collection | Yuki Nakamura | 825 | 15 | 25 | 12375 | 20625 | Document indexing, conflicts check memo, litigation hold notice and acknowledgment forms
  Subtotal — Engagement Kickoff & Document Collection | 45 | 70 | 49875 | 76875
Treaty Interpretation Analysis (Articles 3, 5, 7, 9, 11, 22) | Douglas Carmichael | 1650 | 5 | 8 | 8250 | 13200 | Review and supervision
Treaty Interpretation Analysis (Articles 3, 5, 7, 9, 11, 22) | Jeffrey Park | 1050 | 30 | 40 | 31500 | 42000 | Detailed analysis of key treaty provisions under NY law
Treaty Interpretation Analysis (Articles 3, 5, 7, 9, 11, 22) | Yuki Nakamura | 825 | 25 | 35 | 20625 | 28875 | Legal research, drafting of treaty interpretation memorandum
  Subtotal — Treaty Interpretation Analysis | 60 | 83 | 60375 | 84075
Late Notice Defense Analysis (Article 7 / Meridian Docks) | Jeffrey Park | 1050 | 20 | 25 | 21000 | 26250 | Analysis of 14-month, 7-day notice gap; NY prejudice-based late-notice law; Article 7 individual $1M threshold defense
Late Notice Defense Analysis (Article 7 / Meridian Docks) | Yuki Nakamura | 825 | 15 | 20 | 12375 | 16500 | Case law research and drafting
  Subtotal — Late Notice Defense Analysis | 35 | 45 | 33375 | 42750
IBNR Allocation Analysis (Article 5 / $22.3M dispute) | Jeffrey Park | 1050 | 10 | 15 | 10500 | 15750 | Review of Velthorn actuarial work; coordination with Dr. Stephen Tanaka
IBNR Allocation Analysis (Article 5 / $22.3M dispute) | Yuki Nakamura | 825 | 20 | 30 | 16500 | 24750 | Analysis of Article 5.2 'losses incurred' definition; Velthorn methodology review; model TY 2022 ceded loss reduction from $69.7M to $47.4M if IBNR reallocated
  Subtotal — IBNR Allocation Analysis | 30 | 45 | 27000 | 40500
Follow-the-Fortunes Analysis (Article 11 / Veridian E&O cluster) | Jeffrey Park | 1050 | 15 | 20 | 15750 | 21000 | Analyze $34.5M settlement (A: $14.2M, B: $12.8M, C: $7.5M); QC&S net retained $26.1M; bad faith exception standard
Follow-the-Fortunes Analysis (Article 11 / Veridian E&O cluster) | Yuki Nakamura | 825 | 10 | 15 | 8250 | 12375 | Legal research and drafting
  Subtotal — Follow-the-Fortunes Analysis | 25 | 35 | 24000 | 33375
Premium Reporting & Termination Analysis (Article 3) | Yuki Nakamura | 825 | 10 | 15 | 8250 | 12375 | Analyze $6.8M ceded premium gap ($38.4M vs. $45.2M); Article 3.4 run-off portfolio transfer exclusion; $2,856,000 alleged underpayment at 42% rate
  Subtotal — Premium Reporting & Termination Analysis | 10 | 15 | 8250 | 12375
Arbitration vs. Litigation Forum Analysis (Article 22) | Douglas Carmichael | 1650 | 5 | 8 | 8250 | 13200 | Strategic assessment and review
Arbitration vs. Litigation Forum Analysis (Article 22) | Jeffrey Park | 1050 | 15 | 20 | 15750 | 21000 | ARIAS-U.S. Rules; HFC position that Article 22 inapplicable; NY CPLR Article 75; Federal Arbitration Act
  Subtotal — Forum Analysis | 20 | 28 | 24000 | 34200
Initial Case Assessment Memorandum | Douglas Carmichael | 1650 | 15 | 20 | 24750 | 33000 | Comprehensive assessment of all four grounds; risk evaluation ($0 to $91M exposure range); strategic recommendations
Initial Case Assessment Memorandum | Jeffrey Park | 1050 | 20 | 25 | 21000 | 26250 | Drafting and analysis
  Subtotal — Initial Case Assessment Memorandum | 35 | 45 | 45750 | 59250
Damages & Exposure Summary | Jeffrey Park | 1050 | 10 | 15 | 10500 | 15750 | Best/likely/worst case financial modeling; statutory surplus impact ($1.42B baseline, $1.1B covenant); GAAP after-tax impact ($61.936M if full write-off)
Damages & Exposure Summary | Yuki Nakamura | 825 | 8 | 12 | 6600 | 9900 | Spreadsheet preparation; covenant headroom analysis ($320M current, $241.6M if write-off)
  Subtotal — Damages & Exposure Summary | 18 | 27 | 17100 | 25650
Board Audit Committee Presentation | Douglas Carmichael | 1650 | 8 | 12 | 13200 | 19800 | Presentation to QIH Audit Committee; dispute summary, exposure, strategy, budget
Board Audit Committee Presentation | Francesca Morano | 1550 | 5 | 8 | 7750 | 12400 | Budget and financial impact sections
Board Audit Committee Presentation | Jeffrey Park | 1050 | 8 | 12 | 8400 | 12600 | Drafting
  Subtotal — Board Audit Committee Presentation | 21 | 32 | 29350 | 44800
Regulatory Disclosure Analysis (SEC ASC 450, NYDFS, Cartwright credit agreement) | Francesca Morano | 1550 | 8 | 12 | 12400 | 18600 | SEC 10-Q/10-K contingency footnote; NYDFS notification; Cartwright $750M RCF covenant reporting
Regulatory Disclosure Analysis | Yuki Nakamura | 825 | 10 | 15 | 8250 | 12375 | Research and drafting; coordination with Harmon & Whitfield LLP and Meridian Whitcomb & Co. LLP
  Subtotal — Regulatory Disclosure Analysis | 18 | 27 | 20650 | 30975
Timeline & Chronology Preparation | Yuki Nakamura | 825 | 8 | 12 | 6600 | 9900 | Chronological fact compilation from Treaty inception (July 1, 2019) through engagement opening (March 2, 2026)
  Subtotal — Timeline & Chronology Preparation | 8 | 12 | 6600 | 9900
Phase 1 Partner Supervision & Client Communication | Douglas Carmichael | 1650 | 10 | 15 | 16500 | 24750 | Ongoing client communication with Rachel Sondergaard and QIH leadership
Phase 1 Partner Supervision & Client Communication | Francesca Morano | 1550 | 5 | 8 | 7750 | 12400 | Billing oversight and client coordination
  Subtotal — Partner Supervision & Client Communication | 15 | 23 | 24250 | 37150
PHASE 1 TOTAL | 340 | 487 | 450575 | 631875 | Budget range: $450,000 – $625,000
[sheet: Phase 2 Detail]
Task / Workstream | Timekeeper | Rate ($/hr) | Est. Hours Low | Est. Hours High | Est. Cost Low ($) | Est. Cost High ($) | Notes
Response Letter to Pinnacle Atlantic Pre-Suit Demand (to HFC / Nathaniel R. Calloway III) | Douglas Carmichael | 1650 | 8 | 12 | 13200 | 19800 | Reject all four grounds; assert Treaty Article 22 arbitration; reserve rights
Response Letter to Pinnacle Atlantic Pre-Suit Demand | Jeffrey Park | 1050 | 12 | 18 | 12600 | 18900 | Drafting
  Subtotal — Response Letter | 20 | 30 | 25800 | 38700
Demand to Arbitrate Letter (ARIAS-U.S. Rules) | Jeffrey Park | 1050 | 8 | 12 | 8400 | 12600 | Formal invocation of Treaty Article 22; request counterparty arbitrator appointment
  Subtotal — Demand to Arbitrate | 8 | 12 | 8400 | 12600
Mediation Proposal Letter | Douglas Carmichael | 1650 | 3 | 5 | 4950 | 8250 | Propose voluntary mediation as preliminary step
  Subtotal — Mediation Proposal | 3 | 5 | 4950 | 8250
Settlement Authority Memorandum (to QIH Board Audit Committee) | Douglas Carmichael | 1650 | 10 | 15 | 16500 | 24750 | Recommended settlement parameters; risk-adjusted exposure; litigation cost estimate ($3.2M–$4.8M)
Settlement Authority Memorandum | Francesca Morano | 1550 | 8 | 12 | 12400 | 18600 | Financial impact analysis; covenant compliance
Settlement Authority Memorandum | Jeffrey Park | 1050 | 10 | 15 | 10500 | 15750 | Drafting and analysis
  Subtotal — Settlement Authority Memorandum | 28 | 42 | 39400 | 59100
Draft Verified Answer & Affirmative Defenses | Jeffrey Park | 1050 | 25 | 35 | 26250 | 36750 | Deny claims; assert compliance, timely notice, proper IBNR allocation, follow-the-fortunes, waiver by payment, mandatory arbitration
Draft Verified Answer & Affirmative Defenses | Yuki Nakamura | 825 | 20 | 30 | 16500 | 24750 | Research and drafting
  Subtotal — Verified Answer & Affirmative Defenses | 45 | 65 | 42750 | 61500
Draft Counterclaim (Declaratory Judgment & Breach of Treaty) | Jeffrey Park | 1050 | 15 | 20 | 15750 | 21000 | Confirm validity of $78.4M cessions; damages for wrongful demand
Draft Counterclaim | Yuki Nakamura | 825 | 12 | 18 | 9900 | 14850 | Drafting
  Subtotal — Counterclaim | 27 | 38 | 25650 | 35850
Draft Motion to Compel Arbitration & Stay Litigation | Jeffrey Park | 1050 | 20 | 28 | 21000 | 29400 | Motion papers and memorandum of law; NY CPLR Article 75; FAA
Draft Motion to Compel Arbitration & Stay Litigation | Yuki Nakamura | 825 | 18 | 25 | 14850 | 20625 | Legal research and drafting
  Subtotal — Motion to Compel Arbitration | 38 | 53 | 35850 | 50025
Draft Affidavits (Tobias Engström, Diana Kessler-Hoff) | Jeffrey Park | 1050 | 15 | 20 | 15750 | 21000 | Fact witness affidavits supporting motion
Draft Affidavits | Yuki Nakamura | 825 | 10 | 15 | 8250 | 12375 | Drafting
  Subtotal — Affidavits | 25 | 35 | 24000 | 33375
Counterparty Correspondence Log Maintenance | Yuki Nakamura | 825 | 5 | 8 | 4125 | 6600 | Track all communications with HFC / Pinnacle Atlantic
  Subtotal — Correspondence Log | 5 | 8 | 4125 | 6600
Phase 2 Partner Supervision & Client Communication | Douglas Carmichael | 1650 | 12 | 18 | 19800 | 29700 | Strategy calls, client updates
Phase 2 Partner Supervision & Client Communication | Francesca Morano | 1550 | 5 | 8 | 7750 | 12400 | Billing and budget oversight
  Subtotal — Partner Supervision & Client Communication | 17 | 26 | 27550 | 42100
PHASE 2 TOTAL | 216 | 314 | 238475 | 348100 | Budget range: $375,000 – $550,000
[sheet: Phase 3 Detail]
Task / Workstream | Timekeeper | Rate ($/hr) | Est. Hours Low | Est. Hours High | Est. Cost Low ($) | Est. Cost High ($) | Notes
Draft Document Requests (First Set) to Pinnacle Atlantic | Yuki Nakamura | 825 | 15 | 20 | 12375 | 16500 | Treaty files, internal analyses, actuarial work papers, Broadreach correspondence, underwriting files for TY 2021–2023
Draft Interrogatories (First Set) to Pinnacle Atlantic | Yuki Nakamura | 825 | 12 | 18 | 9900 | 14850 | Factual/actuarial bases for four grounds; $12.6M interest calculation; Article 22 inapplicability basis
Draft Third-Party Subpoena to Broadreach Intermediaries Inc. | Yuki Nakamura | 825 | 5 | 8 | 4125 | 6600 | Treaty placement records, slips, cover notes, billing transmittals; attn: Jamie Castellano
  Subtotal — Written discovery Propounded | 32 | 46 | 26400 | 37950
Document Review & Production (QC&S documents) | Francesca Morano | 1550 | 10 | 15 | 15500 | 23250 | Privilege review oversight
Document Review & Production (QC&S documents) | Jeffrey Park | 1050 | 60 | 90 | 63000 | 94500 | Review claims files, actuarial records, reinsurance correspondence
Document Review & Production (QC&S documents) | Yuki Nakamura | 825 | 120 | 180 | 99000 | 148500 | Primary document review
  Subtotal — Document Review & Production (QC&S) | 190 | 285 | 177500 | 266250
Review Pinnacle Atlantic's Document Production | Jeffrey Park | 1050 | 50 | 80 | 52500 | 84000 | Analyze counterparty documents
Review Pinnacle Atlantic's Document Production | Yuki Nakamura | 825 | 80 | 120 | 66000 | 99000 | Review and catalogue
  Subtotal — Review Counterparty Production | 130 | 200 | 118500 | 183000
Deposition Preparation — Conrad Hesse (SVP, Treaty Disputes, Pinnacle Atlantic) | Douglas Carmichael | 1650 | 10 | 15 | 16500 | 24750 | Strategy and outline review
Deposition Preparation — Conrad Hesse | Jeffrey Park | 1050 | 25 | 35 | 26250 | 36750 | Outline preparation and conduct of deposition
Deposition — Conrad Hesse | Jeffrey Park | 1050 | 8 | 10 | 8400 | 10500 | Day-of deposition (1 day)
Deposition — Lorraine Metcalf (Chief Claims Officer, Pinnacle Atlantic) | Jeffrey Park | 1050 | 20 | 30 | 21000 | 31500 | Preparation and conduct
Deposition — Jamie Castellano (Account Executive, Broadreach) | Jeffrey Park | 1050 | 15 | 22 | 15750 | 23100 | Preparation and conduct; intermediary role, notice transmittals
Deposition — Dr. Stephen Tanaka (Principal Actuary, Velthorn) | Jeffrey Park | 1050 | 15 | 20 | 15750 | 21000 | Preparation and conduct; IBNR allocation methodology
Deposition Support | Yuki Nakamura | 825 | 40 | 60 | 33000 | 49500 | Deposition preparation binders, real-time support, summaries
  Subtotal — Depositions | 133 | 192 | 136650 | 197100
E-discovery Management & Vendor Coordination | Yuki Nakamura | 825 | 20 | 30 | 16500 | 24750 | Platform management, search term development, TAR review
  Subtotal — E-discovery Management | 20 | 30 | 16500 | 24750
Respond to Pinnacle Atlantic discovery Requests | Jeffrey Park | 1050 | 30 | 45 | 31500 | 47250 | Objections, responses, privilege log
Respond to Pinnacle Atlantic discovery Requests | Yuki Nakamura | 825 | 30 | 45 | 24750 | 37125 | Drafting, privilege log compilation
  Subtotal — Respond to Counterparty discovery | 60 | 90 | 56250 | 84375
Phase 3 Partner Supervision | Douglas Carmichael | 1650 | 20 | 30 | 33000 | 49500 | Ongoing strategy, deposition oversight
Phase 3 Partner Supervision | Francesca Morano | 1550 | 8 | 12 | 12400 | 18600 | Budget management
  Subtotal — Partner Supervision | 28 | 42 | 45400 | 68100
PHASE 3 TOTAL | 593 | 885 | 577200 | 861525 | Budget range: $950,000 – $1,450,000 (inclusive of disbursement allocation). E-discovery vendor costs estimated separately at $75,000–$150,000.

[sheet: Cover]

Record

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