1027-00004 · Pellegrino Capital Group · Engagement

engagement-letter-pcg.docx DOCUMENT Real Estate

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CALDERWOOD & HARKNESS LLP Attorneys at Law

1450 Brickell Avenue, Suite 3100 Miami, Florida 33131 Telephone: (305) 884-7200 Facsimile: (305) 884-7201 www.calderwoodharkness.com

June 20, 2025

VIA ELECTRONIC MAIL AND HAND DELIVERY

Veronica Suárez-Pellegrino, Esq. General Counsel Pellegrino Capital Group LLC 2400 Ponce de Leon Boulevard, Suite 1100 Coral Gables, Florida 33134

Re: Engagement of Calderwood & Harkness LLP — Representation of Pellegrino Capital Group LLC in Connection with the Acquisition of Real Property Located at 455 South Ocean Boulevard, Delray Beach, FL 33483

C&H Matter Number: 40225.00001

Dear Ms. Suárez-Pellegrino:

We are pleased to present this engagement letter (this "Letter") setting forth the terms and conditions upon which Calderwood & Harkness LLP ("C&H," the "Firm," "we," or "us") will represent Pellegrino Capital Group LLC ("PCG" or the "Client") in connection with the above-referenced matter. We appreciate the opportunity to serve as PCG's legal counsel in this transaction and look forward to working with you and your team to bring it to a successful conclusion.

This Letter memorializes the terms discussed during our meeting on June 12, 2025, at your Coral Gables offices, following the execution of the Letter of Intent between PCG and Saltaire Hospitality Holdings LLC on that same date. Please review this Letter carefully. If the terms accurately reflect our mutual understanding, please sign and return a copy to us as indicated below.

1. Purpose and Engagement Confirmation

Calderwood & Harkness LLP is pleased to confirm its engagement to represent Pellegrino Capital Group LLC ("PCG") and its newly formed wholly owned subsidiary, PCG Delray Hotel LLC (to be formed as a Florida single-member limited liability company, sole member: PCG) (collectively with PCG, the "Client"), in connection with the acquisition (the "Acquisition" or the "Transaction") of the boutique hotel property known as "The Marisol — A Saltaire Hotel," a 42-key oceanfront boutique hotel and the underlying approximately 1.87-acre land parcel located at 455 South Ocean Boulevard, Delray Beach, Florida 33483 (Palm Beach County Property Appraiser Parcel Control Number: 12-43-46-27-01-005-0010) (collectively, the "Property").

The seller of the Property is Saltaire Hospitality Holdings LLC, a Delaware limited liability company registered to do business in the State of Florida, with its principal place of business at 777 South Flagler Drive, Suite 600, West Palm Beach, Florida 33401 (the "Seller"). We understand that the Seller is a portfolio entity controlled by the Saltaire Opportunity Fund I LLC, a Delaware limited liability company, and that the Seller's principals include Nathaniel Whitford and Elaine Chastain-Park.

The agreed-upon purchase price for the Property is Thirty-Five Million and 00/100 Dollars ($35,000,000.00) (the "Purchase Price"), subject to customary prorations and adjustments to be set forth in the Purchase and Sale Agreement.

The targeted closing date for the Transaction is September 15, 2025 (the "Closing Date"), subject to the satisfaction of all conditions to closing, including but not limited to completion of due diligence, receipt of clear and marketable title, and funding of acquisition financing. The parties may mutually agree to extend the Closing Date under terms to be specified in the Purchase and Sale Agreement.

2. Client Identification

The client in this engagement is Pellegrino Capital Group LLC, a Florida limited liability company organized under the laws of the State of Florida and headquartered in Coral Gables, Florida. We understand that PCG is a single-family office managing approximately $680 million in assets under management across a diversified portfolio of hospitality, multifamily residential, and mixed-use real-estate holdings concentrated in the southeastern United States and the Caribbean.

PCG is controlled by its founder and managing principal, Marco A. Pellegrino, who holds a seventy-eight percent (78%) membership interest in PCG. The remaining twenty-two percent (22%) membership interest is held by the Pellegrino Family Irrevocable Trust (2014), an irrevocable trust established under the laws of the State of Florida.

For purposes of this Transaction, PCG intends to acquire the Property through PCG Delray Hotel LLC, a newly formed single-purpose Florida limited liability company to be wholly owned by PCG and organized for the sole purpose of holding title to the Property and operating the hotel business to be conducted thereon. Our representation extends to PCG Delray Hotel LLC upon its formation, and all references to the "Client" in this Letter shall be deemed to include PCG Delray Hotel LLC unless the context otherwise requires.

The day-to-day client contact and authorized representative for all matters relating to this engagement shall be Veronica Suárez-Pellegrino, Esq., General Counsel, Pellegrino Capital Group LLC. We will direct all communications regarding this engagement to you unless you instruct us otherwise in writing. We understand that you are authorized to provide instructions, make decisions, and execute documents on behalf of PCG and PCG Delray Hotel LLC in connection with the Transaction, subject to such internal approvals as may be required by PCG's governing documents.

3. Scope of Representation

The scope of our representation of the Client in connection with this Transaction is described below. This description is intended to provide clarity regarding the services we have been engaged to provide and the boundaries of our engagement.

3.1 Transaction Structure and Purchase Agreement

The Transaction is structured as a direct asset acquisition of real property and associated personal property, intangible property, and permits (and is not structured as an entity-level purchase of membership interests or equity in the Seller or any of its affiliates). We will advise the Client on all aspects of this transactional structure and will handle the negotiation, drafting, and finalization of the Purchase and Sale Agreement (the "PSA") between Saltaire Hospitality Holdings LLC, as Seller, and PCG Delray Hotel LLC, as Buyer.

The target date for execution of the PSA is July 7, 2025. We will work diligently with you and with Seller's counsel to achieve this target, recognizing that certain open business points may require resolution by the Client's principals before the PSA can be finalized.

Our work in connection with the PSA will include, but not be limited to, the following:

(a) Deposit Structure. Advising on and drafting the deposit provisions of the PSA, which we understand will include: (i) an Earnest Money Deposit in the amount of One Million Seven Hundred Fifty Thousand and 00/100 Dollars ($1,750,000.00), representing five percent (5%) of the Purchase Price, to be deposited with Palmetto Title & Escrow Company (the "Escrow Agent") within three (3) business days following the mutual execution of the PSA; and (ii) an Additional Deposit in the amount of Eight Hundred Seventy-Five Thousand and 00/100 Dollars ($875,000.00), representing two and one-half percent (2.5%) of the Purchase Price, to be deposited with the Escrow Agent within two (2) business days following the expiration of the forty-five (45) day due-diligence period described in Section 3.3 below. We will negotiate the conditions under which deposits become non-refundable and the circumstances under which the Client may obtain a return of its deposits.

(b) Representations and Warranties. Drafting and negotiation of comprehensive representations and warranties of the Seller regarding, among other things, title to the Property, authority to consummate the Transaction, absence of undisclosed liabilities, condition of the Property, environmental matters, compliance with applicable laws, status of contracts, employee matters, litigation, and tax matters. We will also draft the Client's representations and warranties customary for a buyer in a transaction of this type and nature.

(c) Covenants. Drafting and negotiation of pre-closing covenants of the Seller, including covenants regarding the operation of the hotel in the ordinary course of business pending closing, restrictions on entering into or modifying material contracts, maintenance of insurance, compliance with laws, and cooperation with the Client's due-diligence activities.

(d) Conditions to Closing. Drafting and negotiation of conditions precedent to the Client's obligation to close, including the accuracy of Seller's representations and warranties, performance of Seller's covenants, delivery of all required closing documents, receipt of title insurance, availability of acquisition financing, and absence of material adverse changes.

(e) Default and Remedies. Drafting and negotiation of default and remedies provisions, including Seller's remedies upon Buyer default (typically limited to retention of the deposits as liquidated damages) and Buyer's remedies upon Seller default (including the right to specific performance and/or return of deposits with reimbursement of documented out-of-pocket expenses, subject to a cap to be negotiated).

(f) Coordination with Seller's Counsel. Coordination of all negotiations, document exchanges, and communications with Seller's counsel, Hargrove, Kessler & Blaine LLP (lead partner: Patricia "Trish" Blaine, Esq.), located at 515 North Flagler Drive, Suite 800, West Palm Beach, Florida 33401.

3.2 Real-Estate and Title Diligence

We will undertake a comprehensive review and analysis of all title, survey, and real-property diligence matters in connection with the Transaction, including the following:

(a) Title Commitment Review. Review and analysis of the title commitment to be issued by Palmetto Title & Escrow Company (title officer: Denise Lafleur), located at 200 Clematis Street, Suite 400, West Palm Beach, Florida 33401, with Commonwealth Southern Title Insurance Company serving as the title insurance underwriter. We will carefully examine all Schedule B exceptions, requirements, and conditions set forth in the title commitment and will advise the Client as to any defects, encumbrances, or other title matters that may require resolution prior to or at closing.

(b) Survey Review. Review and analysis of the ALTA/NSPS Land Title Survey to be prepared by Crestline Surveying & Mapping, Inc. (principal surveyor: George Tavares, PSM) in accordance with the 2021 ALTA/NSPS Minimum Standard Detail Requirements for Land Title Surveys, including all Table A optional items requested by the Client and the title insurance underwriter. We will review the survey for boundary discrepancies, encroachments, setback violations, easement locations, and other matters that may affect the Client's intended use of the Property.

(c) Existing Encumbrances. Identification and analysis of all existing encumbrances affecting the Property, including but not limited to: (i) the first-mortgage lien held by Seaview National Lending Corp. (approximate payoff balance: $14,350,000), which is to be satisfied and released in full at closing from the Seller's closing proceeds; (ii) a beach access easement in favor of the City of Delray Beach, recorded in Official Records Book 31245, Page 1822, Public Records of Palm Beach County, Florida; (iii) a utility easement in favor of Vireo Group (FPL) along the western boundary of the Property, recorded in Official Records Book 22017, Page 934, Public Records of Palm Beach County, Florida; and (iv) a Declaration of Covenants, Conditions, and Restrictions restricting the use of the Property to hotel and resort purposes, recorded in Official Records Book 18904, Page 455, Public Records of Palm Beach County, Florida. We will evaluate the impact of each such encumbrance on the Client's acquisition and intended use of the Property and will advise the Client accordingly.

(d) Title Objection Letter. Preparation and delivery of a title objection letter to the Seller by the title objection deadline, which is August 7, 2025 (thirty (30) days following the anticipated PSA execution date of July 7, 2025), identifying all title defects and exceptions that the Client requires the Seller to cure or remove prior to closing, and negotiation with Seller's counsel regarding the resolution of such title objections.

(e) Title Insurance. Negotiation of title insurance endorsements for the ALTA Owner's Policy of Title Insurance (coverage amount: $35,000,000.00) and the ALTA Loan Policy of Title Insurance (coverage amount: $24,500,000.00, simultaneous issue), including such endorsements as the Client and its lender may require (e.g., ALTA 3.1, ALTA 9, ALTA 17, ALTA 25, ALTA 28, and such other endorsements as may be applicable and available under Florida law).

(f) Zoning and Land Use. Review of zoning compliance with respect to the Property's classification in the CBD — Central Business District zoning district under the City of Delray Beach Land Development Regulations, including permissible uses, density, setback, height, parking, and FAR requirements. We will also review coastal construction control line setback matters pursuant to Florida Statute § 161.053 and the applicable regulations of the Florida Department of Environmental Protection, to the extent relevant to the existing improvements and any planned capital improvements.

(g) Flood Zone. Review of the FEMA flood zone designation for the Property, which is currently designated as Zone AE, a Special Flood Hazard Area, as shown on FEMA Flood Insurance Rate Map (FIRM) Panel 12099C0826J, effective December 4, 2020. We will advise the Client regarding related insurance requirements and any implications for the Transaction, including the lender's requirement that the Client obtain and maintain flood insurance in an amount equal to or greater than the outstanding loan balance or the maximum coverage available under the National Flood Insurance Program, whichever is less.

(h) Environmental. Coordination with Verdana Environmental Group LLC (project manager: Dr. Anita Robles, P.E.) regarding the Phase I Environmental Site Assessment being conducted for the Property in accordance with ASTM Standard E1527-21. We will review the Phase I ESA report upon completion and advise the Client regarding any Recognized Environmental Conditions (RECs), Controlled Recognized Environmental Conditions (CRECs), or Historical Recognized Environmental Conditions (HRECs) identified therein, as well as any recommendations for further investigation (e.g., Phase II ESA). Our role with respect to environmental matters is limited to legal review and coordination; we are not engaged to provide environmental consulting or engineering services.

3.3 Due Diligence

We will prepare and maintain a comprehensive due-diligence checklist and tracker covering all aspects of the Transaction, including title, survey, environmental, zoning, permits, licenses, contracts, insurance, financial statements, personnel matters, and all other categories of information and documentation relevant to the Client's acquisition of the Property and the hotel operations conducted thereon.

The due-diligence period under the PSA is anticipated to commence on the PSA execution date (target: July 7, 2025) and expire forty-five (45) calendar days thereafter, on August 21, 2025 (the "Due-Diligence Period"). During the Due-Diligence Period, the Client will have the right to inspect and investigate all aspects of the Property and to terminate the PSA for any reason or no reason, with a full refund of the Earnest Money Deposit.

Our due-diligence work will include, but not be limited to, the following:

(a) Permits and Licenses. Review of all hotel operating permits and governmental approvals, including but not limited to the Florida Department of Business and Professional Regulation (DBPR) Liquor License No. BEV-5812947, the elevator permit issued by Palm Beach County (Permit No. EL-2019-003417), the hotel operating license, fire inspection certifications, health department permits, and all other federal, state, and local governmental approvals required for the lawful operation of the hotel.

(b) Contracts. Review of all existing vendor, service, and booking contracts to which the Seller or the Property is a party, including management agreements, franchise agreements (if any), maintenance contracts, laundry service agreements, food and beverage supplier agreements, valet and parking agreements, online travel agency (OTA) agreements, group booking contracts, spa and amenity agreements, and all other material contracts. We will advise the Client regarding the assignability of such contracts, any change-of-control or consent requirements, and the terms and conditions of any contracts that the Client may wish to assume, renegotiate, or terminate in connection with the Transaction.

(c) Management Agreement. Assessment of the termination of the existing hotel management agreement between the Seller and Saltaire Management Co. LLC (a Seller affiliate) (the "Existing Management Agreement"). We understand that the Existing Management Agreement will be terminated at or prior to closing, and we will advise the Client regarding the terms and conditions of such termination, including any termination fees, earn-out provisions, or tail obligations that may apply.

(d) Property Tax Records. Review of property tax records for the Property, including the current assessed value (2024 assessed value: $24,000,000.00), the annual property tax liability (approximately $432,000 per annum), and any pending assessment appeals or tax exemptions. We will review prorations of real property taxes as of the Closing Date and will advise the Client regarding any post-closing adjustment mechanisms.

(e) Hotel Operating Metrics. Review of the Seller's historical and current hotel operating metrics and financial performance data, including trailing-twelve-month (TTM) revenue of approximately $9,800,000, net operating income (NOI) of approximately $3,120,000, average daily rate (ADR) of approximately $485, occupancy of approximately 74%, and revenue per available room (RevPAR) of approximately $359. Our review of financial data is limited to legal analysis and does not constitute a financial audit or independent verification of the Seller's reported figures.

(f) Tax Coordination. Coordination with Whitman Aldridge & Co. LLP (engagement partner: Helen Tsao, CPA), PCG's accounting and tax advisor, on tax structuring and diligence matters relating to the Transaction, including transfer tax calculations, cost-segregation considerations, 1031 exchange analysis (if applicable), and any other tax matters relevant to the structuring and consummation of the Transaction.

3.4 Acquisition Financing

We will review, analyze, and negotiate the term sheet and all definitive loan documentation in connection with the first-mortgage acquisition loan to be provided by Meridian Coast Bank, N.A. (headquarters: 100 West Bay Street, Suite 1500, Jacksonville, Florida 32202; Loan Reference No. MCB-CRE-2025-07184) (the "Lender") in the principal amount of Twenty-Four Million Five Hundred Thousand and 00/100 Dollars ($24,500,000.00) (the "Loan"), representing a loan-to-value ratio of seventy percent (70%) of the Purchase Price.

Based on the term sheet provided to us, we understand that the key terms of the Loan include the following:

(a) Term: Five (5) years, maturing on September 15, 2030.

(b) Amortization: Twenty-five (25) year amortization schedule.

(c) Interest Rate: Fixed interest rate of 6.35% per annum for years one (1) through three (3); floating at the Secured Overnight Financing Rate (SOFR) plus 2.75% (275 basis points) for years four (4) and five (5).

(d) DSCR Covenant: Minimum debt service coverage ratio of 1.25x, tested quarterly on a trailing-twelve-month basis.

(e) Origination Fee: 1.00% of the Loan amount ($245,000).

(f) Prepayment: Yield maintenance premium applicable for the first three (3) years of the Loan term; thereafter, the Loan may be prepaid without premium or penalty upon thirty (30) days' prior written notice to the Lender.

(g) Loan Commitment Deadline: August 28, 2025.

Our work in connection with the acquisition financing will include the following:

(a) Review, analysis, and negotiation of the Loan commitment letter, loan agreement, promissory note, mortgage and security agreement, assignment of rents and leases, assignment of hotel management agreement, guaranty agreement (if required), environmental indemnity agreement, and all other definitive loan documents.

(b) Coordination with the Lender's counsel, Braddock Reeves LLP (lead partner: Jonathan Ng, Esq.), located at 801 Brickell Avenue, Suite 2200, Miami, Florida 33131, regarding the negotiation and finalization of loan documentation and satisfaction of closing conditions.

(c) Review of the Lender's required security package, including: (i) a first-priority mortgage lien on the Property; (ii) an assignment of rents and leases; (iii) an assignment of hotel management agreements; and (iv) a UCC-1 financing statement filing with the Florida Secured Transaction Registry on all furniture, fixtures, and equipment (FF&E) and other personal property associated with the Property. We will advise the Client regarding the scope and extent of the security package and will negotiate modifications to the loan documents as appropriate to protect the Client's interests.

(d) Review of all Lender-required third-party reports, including appraisal, environmental assessment, property condition assessment, franchise comfort letter (if applicable), and any other reports or certifications required by the Lender as conditions to funding.

3.5 Closing Deliverables and Post-Closing

We will prepare and/or review all closing documents required to consummate the Transaction and will coordinate the closing process on behalf of the Client, including the following:

(a) Closing Documents. Preparation and/or review of all closing documents, including but not limited to: (i) the special warranty deed from the Seller to PCG Delray Hotel LLC; (ii) a bill of sale conveying all personal property, FF&E, and tangible assets; (iii) an assignment and assumption of contracts; (iv) the Buyer's closing certificate; (v) a FIRPTA (Foreign Investment in Real Property Tax Act) affidavit from the Seller pursuant to Section 1445 of the Internal Revenue Code; (vi) an owner's affidavit; (vii) the settlement statement (HUD-1 or equivalent closing statement); (viii) transfer tax declarations; and (ix) a proration calculations memorandum reflecting all items to be prorated between the Seller and the Buyer as of the Closing Date.

(b) Entity Formation. Coordination of the formation of PCG Delray Hotel LLC, including: (i) preparation and filing of the Articles of Organization with the Florida Department of State, Division of Corporations; (ii) preparation of the Operating Agreement of PCG Delray Hotel LLC; and (iii) obtaining a federal Employer Identification Number (EIN) from the Internal Revenue Service.

(c) Closing Checklist. Preparation and maintenance of a comprehensive closing checklist identifying all documents, deliverables, consents, approvals, and other items required for the closing of the Transaction on September 15, 2025, including all Lender-required closing conditions.

(d) Settlement Statement and Prorations. Preparation of the settlement statement and a detailed closing prorations memorandum, including but not limited to the calculation of the following items: (i) documentary stamp tax on the deed in the amount of $245,000 (at the rate of $0.70 per $100 of consideration), to be paid by the Seller in accordance with customary practice in Palm Beach County, Florida; (ii) documentary stamp tax on the mortgage in the amount of $85,750 (at the rate of $0.35 per $100 of the Loan amount); (iii) intangible tax on the mortgage in the amount of $49,000 (at the rate of $0.002 per $1.00 of the Loan amount); (iv) title insurance premiums for both the Owner's Policy and the Loan Policy; and (v) all proration items, including real property taxes, hotel revenues, prepaid deposits, advance reservations, utility charges, employee wages and benefits, and other customary proration items.

(e) Post-Closing Transition Agreement. Negotiation and drafting of a post-closing transition agreement (the "Transition Agreement") governing the sixty (60) day transition of hotel operations from the Seller to the Client (September 15, 2025, through November 14, 2025). The Transition Agreement will address, among other things: (i) the transfer of the approximately sixty-four (64) full-time equivalent (FTE) hotel employees to the Client or the Client's designated hotel operator; (ii) the transition of reservation systems, guest loyalty programs, and booking platforms; (iii) the transfer of all permits, licenses, and governmental approvals to the extent transferable; (iv) the orderly wind-down and phase-out of "The Marisol — A Saltaire Hotel" trade name (Florida Fictitious Name Registration No. G19000042817) and all associated branding, signage, and marketing materials; and (v) the cooperation of the Seller and its management affiliate during the transition period.

3.6 Limitations on Scope

The scope of our engagement is limited to the matters described in this Section 3. Without limiting the generality of the foregoing, the following matters are expressly excluded from the scope of our engagement:

(a) Litigation and Regulatory Proceedings. This engagement does not include representation in connection with any litigation, arbitration, mediation, regulatory proceedings, enforcement actions, or tax controversy matters, whether currently pending or arising in the future. If any such matter arises during the course of the Transaction, we will promptly notify the Client and, if requested, discuss whether a separate engagement letter for such matter is appropriate.

(b) Tax Advice. We are not engaged to provide tax advice in connection with this Transaction. PCG's tax and accounting matters, including tax structuring, tax return preparation, and tax compliance, are addressed by Whitman Aldridge & Co. LLP. While we will coordinate with Whitman Aldridge on transactional tax matters as described in Section 3.3(f), the Client should look to Whitman Aldridge for all tax advice and opinions.

(c) Insurance Procurement. We are not engaged to negotiate, procure, or advise on property, casualty, flood, or liability insurance coverage for the Property or the hotel operations. We understand that PCG's insurance placement is through Harborview Risk Advisors LLC, with coverage to be placed through Atlantic Keystone Insurance Company, and that the Client will independently ensure compliance with all insurance requirements under the PSA and the Loan documents.

(d) Appraisal and Valuation. We are not engaged to provide an appraisal, valuation opinion, or investment analysis with respect to the Property. We understand that PCG has separately engaged Saylor & Beckett Valuation Services LLC (appraiser: Martin Saylor, MAI) for the purpose of obtaining an independent appraisal of the Property.

(e) Scope Expansion. Any expansion of the scope of our engagement beyond the matters described in this Section 3 will be confirmed in a supplemental engagement letter or a written amendment to this Letter executed by both parties.

4. Engagement Team

The following attorneys have been assigned to this engagement and will constitute the core engagement team:

Angela Fontaine — Responsible Partner, Real Estate Practice Group. Ms. Fontaine will serve as the lead partner supervising all aspects of the engagement and will be the primary point of contact for strategic and material legal matters. Ms. Fontaine has over twenty-two years of experience representing institutional and private-capital clients in the acquisition, disposition, financing, and development of hospitality, mixed-use, and commercial real-estate assets throughout Florida and the southeastern United States. Ms. Fontaine will be involved in all significant negotiations and decision points throughout the Transaction.

Douglas Fairchild — Billing Partner, Real Estate Practice Group. Mr. Fairchild will serve as the billing partner responsible for the administration and oversight of all billing, invoicing, and client-accounting matters related to the engagement. Mr. Fairchild will also have co-supervisory responsibility for the engagement and will be available to assist with substantive legal matters as needed. Mr. Fairchild brings over eighteen years of experience in complex commercial real-estate transactions and acquisition financing.

Rafael Dominguez — Lead Associate, Real Estate Practice Group. Mr. Dominguez will handle day-to-day transaction management, including drafting and negotiation of principal transaction documents, management of the due-diligence process, and coordination with opposing counsel, lender's counsel, the title company, and third-party vendors and consultants. Mr. Dominguez will serve as the Client's primary day-to-day point of contact and will report regularly to Ms. Fontaine and Mr. Fairchild on the status and progress of the engagement.

Cynthia Ho — Working Associate, Real Estate Practice Group. Ms. Ho will support the engagement team on due-diligence review, checklist and tracker management, title and survey analysis, preparation of closing deliverables, and such other matters as may be assigned to her by Ms. Fontaine, Mr. Fairchild, or Mr. Dominguez.

Additional attorneys, paralegals, legal assistants, or other personnel may be assigned to the engagement as needed to ensure the timely and efficient completion of the work. We will inform the Client of any material changes to the composition of the engagement team, including any change to the Responsible Partner or Lead Associate.

5. Fee Arrangement and Billing

5.1 Hourly Rates

The Firm will bill for its services on an hourly basis at the following current standard rates:

These rates reflect the Firm's current standard rates in effect as of the date of this Letter. Hourly rates are subject to annual adjustment, typically effective January 1 of each year. The Client will be notified in advance of any rate changes, and any adjusted rates will apply to services rendered on or after the effective date of the adjustment. Given the anticipated closing timeline for this Transaction, we do not expect a rate adjustment to take effect during the term of this engagement.

5.2 Billing Practices

Invoices will be rendered monthly and will be transmitted to the Client via electronic mail to the attention of Veronica Suárez-Pellegrino at such email address as the Client may designate. All invoices are due and payable within thirty (30) days of the invoice date. All invoices will reference C&H Matter Number 40225.00001 and will contain a detailed description of the services rendered and the time expended by each timekeeper during the billing period.

Time will be recorded in increments of one-tenth (0.1) of an hour (i.e., six-minute increments). Each time entry will include a description of the work performed that is sufficient to enable the Client to evaluate the services provided.

The Firm reserves the right to charge for reasonable out-of-pocket disbursements and expenses incurred in connection with the engagement, including but not limited to: filing fees, recording fees, courier and messenger charges, travel expenses (at cost, including airfare, mileage, lodging, and meals when travel is required and authorized by the Client), document reproduction and printing charges, and charges for computerized legal research and database services. Disbursements and expenses will be itemized on the monthly invoice separately from professional fees.

5.3 Retainer. No retainer deposit is required at this time. The Firm reserves the right to request a retainer deposit in the future if circumstances warrant, including in the event that invoices remain unpaid beyond the thirty (30) day payment period described in Section 5.2.

5.4 Estimated Budget

Based on our current understanding of the Transaction, including the scope of services described in Section 3, the anticipated transaction timeline, and the complexity of the matters to be addressed, we estimate that total legal fees for this engagement will fall in the range of $175,000 to $225,000, exclusive of disbursements and third-party costs.

This estimate is provided for budgeting and planning purposes only and does not constitute a cap, ceiling, or fixed fee arrangement. Actual fees will depend on a number of factors that are not entirely within the Firm's control, including the complexity and duration of the Transaction, the extent and nature of title issues or defects identified during the diligence process, the findings of the environmental, survey, and other third-party investigations, the nature and extent of negotiation with Seller's counsel and the Lender's counsel, the number and complexity of lender requirements and loan documentation, and any unforeseen issues that may arise during the course of the engagement.

We will endeavor to keep the Client informed of billing progress throughout the engagement and will promptly advise the Client if, based on the status of the engagement at any point, we anticipate that total fees will exceed the estimated range set forth above. We are committed to delivering our services efficiently and cost-effectively and welcome an open dialogue with the Client regarding budget matters at any time.

6. Conflicts of Interest

We have conducted a conflicts check in accordance with the Firm's standard procedures and the applicable Rules Regulating the Florida Bar, including Rules 4-1.7 (Conflict of Interest; Current Clients) and 4-1.9 (Duties to Former Clients).

Based on our review, we have identified no conflicts of interest that would preclude this engagement or that would require the Client's informed consent under the applicable Rules of Professional Conduct. Specifically, the Firm does not currently represent, and has not within the preceding twenty-four (24) months represented, any of the following persons or entities in any matter that is the same as or substantially related to this Transaction or in any matter adverse to PCG:

• Saltaire Hospitality Holdings LLC

• Saltaire Opportunity Fund I LLC

• Saltaire Management Co. LLC

• Nathaniel Whitford

• Elaine Chastain-Park

• Meridian Coast Bank, N.A.

• Seaview National Lending Corp.

• Any affiliate, subsidiary, or related entity of any of the foregoing

If a potential conflict of interest arises during the course of the engagement, we will promptly notify the Client and will address the matter in accordance with the applicable professional responsibility rules, including, if appropriate, seeking the Client's informed written consent to continued representation after full disclosure of all material facts and circumstances.

By signing this Letter, the Client acknowledges that Calderwood & Harkness LLP is a large, multi-office law firm with a diverse client base and that the Firm may represent other clients in unrelated matters whose interests may differ from those of PCG. The Firm's representation of PCG in connection with this Transaction does not preclude the Firm from representing other clients in matters unrelated to this Transaction, even if such other clients may have interests that are generally adverse to PCG in other contexts, provided that such representation does not create a conflict under the applicable professional responsibility rules.

7. Confidentiality

All information provided to us by or on behalf of the Client in connection with this engagement will be treated as confidential and privileged to the fullest extent permitted by applicable law, including the attorney-client privilege and the work-product doctrine. The Firm will implement appropriate administrative, physical, and technical safeguards to protect the confidentiality and security of the Client's information.

We will not disclose confidential information to any third party without the Client's prior written consent, except as required by law, court order, or regulatory obligation, or as necessary to carry out the purposes of the engagement. In the ordinary course of this Transaction, it will be necessary for us to communicate with and share certain information with the Seller's counsel, the Lender's counsel, the title company, the surveyor, the environmental consultant, governmental authorities in connection with filings and recordings, and other parties to the Transaction. The Client's execution of this Letter constitutes the Client's consent to such disclosures as are reasonably necessary in furtherance of the representation and the consummation of the Transaction, provided that we will exercise reasonable judgment regarding the nature and extent of information shared with such third parties.

8. Document Retention

Upon conclusion of the engagement, the Firm will retain the client files (including both physical and electronic files) in accordance with the Firm's standard document retention policy, which currently provides for a minimum retention period of seven (7) years from the date of matter closure. Following the expiration of the retention period, the Firm reserves the right to destroy client files in accordance with its standard document destruction procedures, without further notice to the Client.

Original documents will be returned to the Client upon request at any time during or following the engagement. The Client is encouraged to request return of any original documents in the Firm's possession promptly upon the conclusion of the engagement. The Firm will not charge for the return of original documents but may charge for the cost of reproducing copies of file materials requested by the Client.

9. Termination

Either party may terminate this engagement at any time, with or without cause, upon written notice to the other party. In the event of termination by the Client, the Client will remain responsible for payment of all fees and disbursements incurred through the date of termination, including fees for services rendered and expenses incurred up to and including the date on which the Firm ceases work on the matter.

In the event of termination by either party, the Firm will take all steps reasonably necessary to protect the Client's interests in the Transaction, including cooperating in the orderly transition of the matter to successor counsel designated by the Client. The Firm will promptly deliver to the Client or its successor counsel all client files, documents, and materials in the Firm's possession relating to the engagement, subject to the Client's payment of all outstanding invoices.

The Firm's right to terminate this engagement is subject to the requirements of the applicable Rules of Professional Conduct, including the obligation to provide the Client with reasonable notice and an opportunity to retain successor counsel before the Firm's withdrawal becomes effective.

10. Governing Law

This engagement letter and the relationship between Calderwood & Harkness LLP and Pellegrino Capital Group LLC in connection with this matter shall be governed by and construed in accordance with the laws of the State of Florida, without regard to its conflict-of-laws principles. Any dispute arising out of or relating to this Letter or the engagement described herein shall be subject to the exclusive jurisdiction of the state and federal courts located in Miami-Dade County, Florida.

11. Acceptance and Agreement

We respectfully request that the Client review this Letter carefully and, if the terms accurately reflect our mutual understanding of the engagement, execute and return a copy of this Letter to our offices to confirm the Client's agreement with the terms and conditions set forth herein. A duplicate original is enclosed for the Client's records. Alternatively, a signed PDF copy transmitted via electronic mail to angela.fontaine@calderwoodharkness.com shall be deemed an original for all purposes.

This engagement is effective as of June 20, 2025. We are eager to commence work on this Transaction and look forward to a productive and successful engagement.

If you have any questions or would like to discuss any of the terms of this Letter, please do not hesitate to contact me directly at (305) 884-7210 or angela.fontaine@calderwoodharkness.com.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Name: Angela Fontaine

Title: Partner — Responsible Partner, Real Estate Practice Group

By: ________

Name: Douglas Fairchild

Title: Partner — Billing Partner, Real Estate Practice Group

Calderwood & Harkness LLP 1450 Brickell Avenue, Suite 3100 Miami, Florida 33131

AGREED AND ACCEPTED:

The undersigned, on behalf of Pellegrino Capital Group LLC, hereby confirms that the undersigned has read and understands the terms and conditions of this engagement letter, and hereby agrees to be bound by such terms and conditions.

PELLEGRINO CAPITAL GROUP LLC

By: ________

Name: Veronica Suárez-Pellegrino

Title: General Counsel

Date: ________

Enclosures:

• Duplicate original of this Engagement Letter

cc:

Marco A. Pellegrino, Managing Principal, Pellegrino Capital Group LLC Rafael Dominguez, Calderwood & Harkness LLP Cynthia Ho, Calderwood & Harkness LLP

Timekeeper Category	Hourly Rate
Partners	$895.00 per hour
Senior Associates	$625.00 per hour
Associates	$475.00 per hour
Paralegals / Legal Assistants	$275.00 per hour

CALDERWOOD & HARKNESS LLP Attorneys at Law
1450 Brickell Avenue, Suite 3100 Miami, Florida 33131 Telephone: (305) 884-7200 Facsimile: (305) 884-7201 www.calderwoodharkness.com
June 20, 2025
VIA ELECTRONIC MAIL AND HAND DELIVERY
Veronica Suárez-Pellegrino, Esq. General Counsel Pellegrino Capital Group LLC 2400 Ponce de Leon Boulevard, Suite 1100 Coral Gables, Florida 33134
Re: Engagement of Calderwood & Harkness LLP — Representation of Pellegrino Capital Group LLC in Connection with the Acquisition of Real Property Located at 455 South Ocean Boulevard, Delray Beach, FL 33483
C&H Matter Number: 40225.00001
Dear Ms. Suárez-Pellegrino:
We are pleased to present this engagement letter (this "Letter") setting forth the terms and conditions upon which Calderwood & Harkness LLP ("C&H," the "Firm," "we," or "us") will represent Pellegrino Capital Group LLC ("PCG" or the "Client") in connection with the above-referenced matter. We appreciate the opportunity to serve as PCG's legal counsel in this transaction and look forward to working with you and your team to bring it to a successful conclusion.
This Letter memorializes the terms discussed during our meeting on June 12, 2025, at your Coral Gables offices, following the execution of the Letter of Intent between PCG and Saltaire Hospitality Holdings LLC on that same date. Please review this Letter carefully. If the terms accurately reflect our mutual understanding, please sign and return a copy to us as indicated below.
1. Purpose and Engagement Confirmation
Calderwood & Harkness LLP is pleased to confirm its engagement to represent Pellegrino Capital Group LLC ("PCG") and its newly formed wholly owned subsidiary, PCG Delray Hotel LLC (to be formed as a Florida single-member limited liability company, sole member: PCG) (collectively with PCG, the "Client"), in connection with the acquisition (the "Acquisition" or the "Transaction") of the boutique hotel property known as "The Marisol — A Saltaire Hotel," a 42-key oceanfront boutique hotel and the underlying approximately 1.87-acre land parcel located at 455 South Ocean Boulevard, Delray Beach, Florida 33483 (Palm Beach County Property Appraiser Parcel Control Number: 12-43-46-27-01-005-0010) (collectively, the "Property").
The seller of the Property is Saltaire Hospitality Holdings LLC, a Delaware limited liability company registered to do business in the State of Florida, with its principal place of business at 777 South Flagler Drive, Suite 600, West Palm Beach, Florida 33401 (the "Seller"). We understand that the Seller is a portfolio entity controlled by the Saltaire Opportunity Fund I LLC, a Delaware limited liability company, and that the Seller's principals include Nathaniel Whitford and Elaine Chastain-Park.
The agreed-upon purchase price for the Property is Thirty-Five Million and 00/100 Dollars ($35,000,000.00) (the "Purchase Price"), subject to customary prorations and adjustments to be set forth in the Purchase and Sale Agreement.
The targeted closing date for the Transaction is September 15, 2025 (the "Closing Date"), subject to the satisfaction of all conditions to closing, including but not limited to completion of due diligence, receipt of clear and marketable title, and funding of acquisition financing. The parties may mutually agree to extend the Closing Date under terms to be specified in the Purchase and Sale Agreement.
2. Client Identification
The client in this engagement is Pellegrino Capital Group LLC, a Florida limited liability company organized under the laws of the State of Florida and headquartered in Coral Gables, Florida. We understand that PCG is a single-family office managing approximately $680 million in assets under management across a diversified portfolio of hospitality, multifamily residential, and mixed-use real-estate holdings concentrated in the southeastern United States and the Caribbean.
PCG is controlled by its founder and managing principal, Marco A. Pellegrino, who holds a seventy-eight percent (78%) membership interest in PCG. The remaining twenty-two percent (22%) membership interest is held by the Pellegrino Family Irrevocable Trust (2014), an irrevocable trust established under the laws of the State of Florida.
For purposes of this Transaction, PCG intends to acquire the Property through PCG Delray Hotel LLC, a newly formed single-purpose Florida limited liability company to be wholly owned by PCG and organized for the sole purpose of holding title to the Property and operating the hotel business to be conducted thereon. Our representation extends to PCG Delray Hotel LLC upon its formation, and all references to the "Client" in this Letter shall be deemed to include PCG Delray Hotel LLC unless the context otherwise requires.
The day-to-day client contact and authorized representative for all matters relating to this engagement shall be Veronica Suárez-Pellegrino, Esq., General Counsel, Pellegrino Capital Group LLC. We will direct all communications regarding this engagement to you unless you instruct us otherwise in writing. We understand that you are authorized to provide instructions, make decisions, and execute documents on behalf of PCG and PCG Delray Hotel LLC in connection with the Transaction, subject to such internal approvals as may be required by PCG's governing documents.
3. Scope of Representation
The scope of our representation of the Client in connection with this Transaction is described below. This description is intended to provide clarity regarding the services we have been engaged to provide and the boundaries of our engagement.
3.1 Transaction Structure and Purchase Agreement
The Transaction is structured as a direct asset acquisition of real property and associated personal property, intangible property, and permits (and is not structured as an entity-level purchase of membership interests or equity in the Seller or any of its affiliates). We will advise the Client on all aspects of this transactional structure and will handle the negotiation, drafting, and finalization of the Purchase and Sale Agreement (the "PSA") between Saltaire Hospitality Holdings LLC, as Seller, and PCG Delray Hotel LLC, as Buyer.
The target date for execution of the PSA is July 7, 2025. We will work diligently with you and with Seller's counsel to achieve this target, recognizing that certain open business points may require resolution by the Client's principals before the PSA can be finalized.
Our work in connection with the PSA will include, but not be limited to, the following:
(a) Deposit Structure. Advising on and drafting the deposit provisions of the PSA, which we understand will include: (i) an Earnest Money Deposit in the amount of One Million Seven Hundred Fifty Thousand and 00/100 Dollars ($1,750,000.00), representing five percent (5%) of the Purchase Price, to be deposited with Palmetto Title & Escrow Company (the "Escrow Agent") within three (3) business days following the mutual execution of the PSA; and (ii) an Additional Deposit in the amount of Eight Hundred Seventy-Five Thousand and 00/100 Dollars ($875,000.00), representing two and one-half percent (2.5%) of the Purchase Price, to be deposited with the Escrow Agent within two (2) business days following the expiration of the forty-five (45) day due-diligence period described in Section 3.3 below. We will negotiate the conditions under which deposits become non-refundable and the circumstances under which the Client may obtain a return of its deposits.
(b) Representations and Warranties. Drafting and negotiation of comprehensive representations and warranties of the Seller regarding, among other things, title to the Property, authority to consummate the Transaction, absence of undisclosed liabilities, condition of the Property, environmental matters, compliance with applicable laws, status of contracts, employee matters, litigation, and tax matters. We will also draft the Client's representations and warranties customary for a buyer in a transaction of this type and nature.
(c) Covenants. Drafting and negotiation of pre-closing covenants of the Seller, including covenants regarding the operation of the hotel in the ordinary course of business pending closing, restrictions on entering into or modifying material contracts, maintenance of insurance, compliance with laws, and cooperation with the Client's due-diligence activities.
(d) Conditions to Closing. Drafting and negotiation of conditions precedent to the Client's obligation to close, including the accuracy of Seller's representations and warranties, performance of Seller's covenants, delivery of all required closing documents, receipt of title insurance, availability of acquisition financing, and absence of material adverse changes.
(e) Default and Remedies. Drafting and negotiation of default and remedies provisions, including Seller's remedies upon Buyer default (typically limited to retention of the deposits as liquidated damages) and Buyer's remedies upon Seller default (including the right to specific performance and/or return of deposits with reimbursement of documented out-of-pocket expenses, subject to a cap to be negotiated).
(f) Coordination with Seller's Counsel. Coordination of all negotiations, document exchanges, and communications with Seller's counsel, Hargrove, Kessler & Blaine LLP (lead partner: Patricia "Trish" Blaine, Esq.), located at 515 North Flagler Drive, Suite 800, West Palm Beach, Florida 33401.
3.2 Real-Estate and Title Diligence
We will undertake a comprehensive review and analysis of all title, survey, and real-property diligence matters in connection with the Transaction, including the following:
(a) Title Commitment Review. Review and analysis of the title commitment to be issued by Palmetto Title & Escrow Company (title officer: Denise Lafleur), located at 200 Clematis Street, Suite 400, West Palm Beach, Florida 33401, with Commonwealth Southern Title Insurance Company serving as the title insurance underwriter. We will carefully examine all Schedule B exceptions, requirements, and conditions set forth in the title commitment and will advise the Client as to any defects, encumbrances, or other title matters that may require resolution prior to or at closing.
(b) Survey Review. Review and analysis of the ALTA/NSPS Land Title Survey to be prepared by Crestline Surveying & Mapping, Inc. (principal surveyor: George Tavares, PSM) in accordance with the 2021 ALTA/NSPS Minimum Standard Detail Requirements for Land Title Surveys, including all Table A optional items requested by the Client and the title insurance underwriter. We will review the survey for boundary discrepancies, encroachments, setback violations, easement locations, and other matters that may affect the Client's intended use of the Property.
(c) Existing Encumbrances. Identification and analysis of all existing encumbrances affecting the Property, including but not limited to: (i) the first-mortgage lien held by Seaview National Lending Corp. (approximate payoff balance: $14,350,000), which is to be satisfied and released in full at closing from the Seller's closing proceeds; (ii) a beach access easement in favor of the City of Delray Beach, recorded in Official Records Book 31245, Page 1822, Public Records of Palm Beach County, Florida; (iii) a utility easement in favor of Vireo Group (FPL) along the western boundary of the Property, recorded in Official Records Book 22017, Page 934, Public Records of Palm Beach County, Florida; and (iv) a Declaration of Covenants, Conditions, and Restrictions restricting the use of the Property to hotel and resort purposes, recorded in Official Records Book 18904, Page 455, Public Records of Palm Beach County, Florida. We will evaluate the impact of each such encumbrance on the Client's acquisition and intended use of the Property and will advise the Client accordingly.
(d) Title Objection Letter. Preparation and delivery of a title objection letter to the Seller by the title objection deadline, which is August 7, 2025 (thirty (30) days following the anticipated PSA execution date of July 7, 2025), identifying all title defects and exceptions that the Client requires the Seller to cure or remove prior to closing, and negotiation with Seller's counsel regarding the resolution of such title objections.
(e) Title Insurance. Negotiation of title insurance endorsements for the ALTA Owner's Policy of Title Insurance (coverage amount: $35,000,000.00) and the ALTA Loan Policy of Title Insurance (coverage amount: $24,500,000.00, simultaneous issue), including such endorsements as the Client and its lender may require (e.g., ALTA 3.1, ALTA 9, ALTA 17, ALTA 25, ALTA 28, and such other endorsements as may be applicable and available under Florida law).
(f) Zoning and Land Use. Review of zoning compliance with respect to the Property's classification in the CBD — Central Business District zoning district under the City of Delray Beach Land Development Regulations, including permissible uses, density, setback, height, parking, and FAR requirements. We will also review coastal construction control line setback matters pursuant to Florida Statute § 161.053 and the applicable regulations of the Florida Department of Environmental Protection, to the extent relevant to the existing improvements and any planned capital improvements.
(g) Flood Zone. Review of the FEMA flood zone designation for the Property, which is currently designated as Zone AE, a Special Flood Hazard Area, as shown on FEMA Flood Insurance Rate Map (FIRM) Panel 12099C0826J, effective December 4, 2020. We will advise the Client regarding related insurance requirements and any implications for the Transaction, including the lender's requirement that the Client obtain and maintain flood insurance in an amount equal to or greater than the outstanding loan balance or the maximum coverage available under the National Flood Insurance Program, whichever is less.
(h) Environmental. Coordination with Verdana Environmental Group LLC (project manager: Dr. Anita Robles, P.E.) regarding the Phase I Environmental Site Assessment being conducted for the Property in accordance with ASTM Standard E1527-21. We will review the Phase I ESA report upon completion and advise the Client regarding any Recognized Environmental Conditions (RECs), Controlled Recognized Environmental Conditions (CRECs), or Historical Recognized Environmental Conditions (HRECs) identified therein, as well as any recommendations for further investigation (e.g., Phase II ESA). Our role with respect to environmental matters is limited to legal review and coordination; we are not engaged to provide environmental consulting or engineering services.
3.3 Due Diligence
We will prepare and maintain a comprehensive due-diligence checklist and tracker covering all aspects of the Transaction, including title, survey, environmental, zoning, permits, licenses, contracts, insurance, financial statements, personnel matters, and all other categories of information and documentation relevant to the Client's acquisition of the Property and the hotel operations conducted thereon.
The due-diligence period under the PSA is anticipated to commence on the PSA execution date (target: July 7, 2025) and expire forty-five (45) calendar days thereafter, on August 21, 2025 (the "Due-Diligence Period"). During the Due-Diligence Period, the Client will have the right to inspect and investigate all aspects of the Property and to terminate the PSA for any reason or no reason, with a full refund of the Earnest Money Deposit.
Our due-diligence work will include, but not be limited to, the following:
(a) Permits and Licenses. Review of all hotel operating permits and governmental approvals, including but not limited to the Florida Department of Business and Professional Regulation (DBPR) Liquor License No. BEV-5812947, the elevator permit issued by Palm Beach County (Permit No. EL-2019-003417), the hotel operating license, fire inspection certifications, health department permits, and all other federal, state, and local governmental approvals required for the lawful operation of the hotel.
(b) Contracts. Review of all existing vendor, service, and booking contracts to which the Seller or the Property is a party, including management agreements, franchise agreements (if any), maintenance contracts, laundry service agreements, food and beverage supplier agreements, valet and parking agreements, online travel agency (OTA) agreements, group booking contracts, spa and amenity agreements, and all other material contracts. We will advise the Client regarding the assignability of such contracts, any change-of-control or consent requirements, and the terms and conditions of any contracts that the Client may wish to assume, renegotiate, or terminate in connection with the Transaction.
(c) Management Agreement. Assessment of the termination of the existing hotel management agreement between the Seller and Saltaire Management Co. LLC (a Seller affiliate) (the "Existing Management Agreement"). We understand that the Existing Management Agreement will be terminated at or prior to closing, and we will advise the Client regarding the terms and conditions of such termination, including any termination fees, earn-out provisions, or tail obligations that may apply.
(d) Property Tax Records. Review of property tax records for the Property, including the current assessed value (2024 assessed value: $24,000,000.00), the annual property tax liability (approximately $432,000 per annum), and any pending assessment appeals or tax exemptions. We will review prorations of real property taxes as of the Closing Date and will advise the Client regarding any post-closing adjustment mechanisms.
(e) Hotel Operating Metrics. Review of the Seller's historical and current hotel operating metrics and financial performance data, including trailing-twelve-month (TTM) revenue of approximately $9,800,000, net operating income (NOI) of approximately $3,120,000, average daily rate (ADR) of approximately $485, occupancy of approximately 74%, and revenue per available room (RevPAR) of approximately $359. Our review of financial data is limited to legal analysis and does not constitute a financial audit or independent verification of the Seller's reported figures.
(f) Tax Coordination. Coordination with Whitman Aldridge & Co. LLP (engagement partner: Helen Tsao, CPA), PCG's accounting and tax advisor, on tax structuring and diligence matters relating to the Transaction, including transfer tax calculations, cost-segregation considerations, 1031 exchange analysis (if applicable), and any other tax matters relevant to the structuring and consummation of the Transaction.
3.4 Acquisition Financing
We will review, analyze, and negotiate the term sheet and all definitive loan documentation in connection with the first-mortgage acquisition loan to be provided by Meridian Coast Bank, N.A. (headquarters: 100 West Bay Street, Suite 1500, Jacksonville, Florida 32202; Loan Reference No. MCB-CRE-2025-07184) (the "Lender") in the principal amount of Twenty-Four Million Five Hundred Thousand and 00/100 Dollars ($24,500,000.00) (the "Loan"), representing a loan-to-value ratio of seventy percent (70%) of the Purchase Price.
Based on the term sheet provided to us, we understand that the key terms of the Loan include the following:
(a) Term: Five (5) years, maturing on September 15, 2030.
(b) Amortization: Twenty-five (25) year amortization schedule.
(c) Interest Rate: Fixed interest rate of 6.35% per annum for years one (1) through three (3); floating at the Secured Overnight Financing Rate (SOFR) plus 2.75% (275 basis points) for years four (4) and five (5).
(d) DSCR Covenant: Minimum debt service coverage ratio of 1.25x, tested quarterly on a trailing-twelve-month basis.
(e) Origination Fee: 1.00% of the Loan amount ($245,000).
(f) Prepayment: Yield maintenance premium applicable for the first three (3) years of the Loan term; thereafter, the Loan may be prepaid without premium or penalty upon thirty (30) days' prior written notice to the Lender.
(g) Loan Commitment Deadline: August 28, 2025.
Our work in connection with the acquisition financing will include the following:
(a) Review, analysis, and negotiation of the Loan commitment letter, loan agreement, promissory note, mortgage and security agreement, assignment of rents and leases, assignment of hotel management agreement, guaranty agreement (if required), environmental indemnity agreement, and all other definitive loan documents.
(b) Coordination with the Lender's counsel, Braddock Reeves LLP (lead partner: Jonathan Ng, Esq.), located at 801 Brickell Avenue, Suite 2200, Miami, Florida 33131, regarding the negotiation and finalization of loan documentation and satisfaction of closing conditions.
(c) Review of the Lender's required security package, including: (i) a first-priority mortgage lien on the Property; (ii) an assignment of rents and leases; (iii) an assignment of hotel management agreements; and (iv) a UCC-1 financing statement filing with the Florida Secured Transaction Registry on all furniture, fixtures, and equipment (FF&E) and other personal property associated with the Property. We will advise the Client regarding the scope and extent of the security package and will negotiate modifications to the loan documents as appropriate to protect the Client's interests.
(d) Review of all Lender-required third-party reports, including appraisal, environmental assessment, property condition assessment, franchise comfort letter (if applicable), and any other reports or certifications required by the Lender as conditions to funding.
3.5 Closing Deliverables and Post-Closing
We will prepare and/or review all closing documents required to consummate the Transaction and will coordinate the closing process on behalf of the Client, including the following:
(a) Closing Documents. Preparation and/or review of all closing documents, including but not limited to: (i) the special warranty deed from the Seller to PCG Delray Hotel LLC; (ii) a bill of sale conveying all personal property, FF&E, and tangible assets; (iii) an assignment and assumption of contracts; (iv) the Buyer's closing certificate; (v) a FIRPTA (Foreign Investment in Real Property Tax Act) affidavit from the Seller pursuant to Section 1445 of the Internal Revenue Code; (vi) an owner's affidavit; (vii) the settlement statement (HUD-1 or equivalent closing statement); (viii) transfer tax declarations; and (ix) a proration calculations memorandum reflecting all items to be prorated between the Seller and the Buyer as of the Closing Date.
(b) Entity Formation. Coordination of the formation of PCG Delray Hotel LLC, including: (i) preparation and filing of the Articles of Organization with the Florida Department of State, Division of Corporations; (ii) preparation of the Operating Agreement of PCG Delray Hotel LLC; and (iii) obtaining a federal Employer Identification Number (EIN) from the Internal Revenue Service.
(c) Closing Checklist. Preparation and maintenance of a comprehensive closing checklist identifying all documents, deliverables, consents, approvals, and other items required for the closing of the Transaction on September 15, 2025, including all Lender-required closing conditions.
(d) Settlement Statement and Prorations. Preparation of the settlement statement and a detailed closing prorations memorandum, including but not limited to the calculation of the following items: (i) documentary stamp tax on the deed in the amount of $245,000 (at the rate of $0.70 per $100 of consideration), to be paid by the Seller in accordance with customary practice in Palm Beach County, Florida; (ii) documentary stamp tax on the mortgage in the amount of $85,750 (at the rate of $0.35 per $100 of the Loan amount); (iii) intangible tax on the mortgage in the amount of $49,000 (at the rate of $0.002 per $1.00 of the Loan amount); (iv) title insurance premiums for both the Owner's Policy and the Loan Policy; and (v) all proration items, including real property taxes, hotel revenues, prepaid deposits, advance reservations, utility charges, employee wages and benefits, and other customary proration items.
(e) Post-Closing Transition Agreement. Negotiation and drafting of a post-closing transition agreement (the "Transition Agreement") governing the sixty (60) day transition of hotel operations from the Seller to the Client (September 15, 2025, through November 14, 2025). The Transition Agreement will address, among other things: (i) the transfer of the approximately sixty-four (64) full-time equivalent (FTE) hotel employees to the Client or the Client's designated hotel operator; (ii) the transition of reservation systems, guest loyalty programs, and booking platforms; (iii) the transfer of all permits, licenses, and governmental approvals to the extent transferable; (iv) the orderly wind-down and phase-out of "The Marisol — A Saltaire Hotel" trade name (Florida Fictitious Name Registration No. G19000042817) and all associated branding, signage, and marketing materials; and (v) the cooperation of the Seller and its management affiliate during the transition period.
3.6 Limitations on Scope
The scope of our engagement is limited to the matters described in this Section 3. Without limiting the generality of the foregoing, the following matters are expressly excluded from the scope of our engagement:
(a) Litigation and Regulatory Proceedings. This engagement does not include representation in connection with any litigation, arbitration, mediation, regulatory proceedings, enforcement actions, or tax controversy matters, whether currently pending or arising in the future. If any such matter arises during the course of the Transaction, we will promptly notify the Client and, if requested, discuss whether a separate engagement letter for such matter is appropriate.
(b) Tax Advice. We are not engaged to provide tax advice in connection with this Transaction. PCG's tax and accounting matters, including tax structuring, tax return preparation, and tax compliance, are addressed by Whitman Aldridge & Co. LLP. While we will coordinate with Whitman Aldridge on transactional tax matters as described in Section 3.3(f), the Client should look to Whitman Aldridge for all tax advice and opinions.
(c) Insurance Procurement. We are not engaged to negotiate, procure, or advise on property, casualty, flood, or liability insurance coverage for the Property or the hotel operations. We understand that PCG's insurance placement is through Harborview Risk Advisors LLC, with coverage to be placed through Atlantic Keystone Insurance Company, and that the Client will independently ensure compliance with all insurance requirements under the PSA and the Loan documents.
(d) Appraisal and Valuation. We are not engaged to provide an appraisal, valuation opinion, or investment analysis with respect to the Property. We understand that PCG has separately engaged Saylor & Beckett Valuation Services LLC (appraiser: Martin Saylor, MAI) for the purpose of obtaining an independent appraisal of the Property.
(e) Scope Expansion. Any expansion of the scope of our engagement beyond the matters described in this Section 3 will be confirmed in a supplemental engagement letter or a written amendment to this Letter executed by both parties.
4. Engagement Team
The following attorneys have been assigned to this engagement and will constitute the core engagement team:
Angela Fontaine — Responsible Partner, Real Estate Practice Group. Ms. Fontaine will serve as the lead partner supervising all aspects of the engagement and will be the primary point of contact for strategic and material legal matters. Ms. Fontaine has over twenty-two years of experience representing institutional and private-capital clients in the acquisition, disposition, financing, and development of hospitality, mixed-use, and commercial real-estate assets throughout Florida and the southeastern United States. Ms. Fontaine will be involved in all significant negotiations and decision points throughout the Transaction.
Douglas Fairchild — Billing Partner, Real Estate Practice Group. Mr. Fairchild will serve as the billing partner responsible for the administration and oversight of all billing, invoicing, and client-accounting matters related to the engagement. Mr. Fairchild will also have co-supervisory responsibility for the engagement and will be available to assist with substantive legal matters as needed. Mr. Fairchild brings over eighteen years of experience in complex commercial real-estate transactions and acquisition financing.
Rafael Dominguez — Lead Associate, Real Estate Practice Group. Mr. Dominguez will handle day-to-day transaction management, including drafting and negotiation of principal transaction documents, management of the due-diligence process, and coordination with opposing counsel, lender's counsel, the title company, and third-party vendors and consultants. Mr. Dominguez will serve as the Client's primary day-to-day point of contact and will report regularly to Ms. Fontaine and Mr. Fairchild on the status and progress of the engagement.
Cynthia Ho — Working Associate, Real Estate Practice Group. Ms. Ho will support the engagement team on due-diligence review, checklist and tracker management, title and survey analysis, preparation of closing deliverables, and such other matters as may be assigned to her by Ms. Fontaine, Mr. Fairchild, or Mr. Dominguez.
Additional attorneys, paralegals, legal assistants, or other personnel may be assigned to the engagement as needed to ensure the timely and efficient completion of the work. We will inform the Client of any material changes to the composition of the engagement team, including any change to the Responsible Partner or Lead Associate.
5. Fee Arrangement and Billing
5.1 Hourly Rates
The Firm will bill for its services on an hourly basis at the following current standard rates:
These rates reflect the Firm's current standard rates in effect as of the date of this Letter. Hourly rates are subject to annual adjustment, typically effective January 1 of each year. The Client will be notified in advance of any rate changes, and any adjusted rates will apply to services rendered on or after the effective date of the adjustment. Given the anticipated closing timeline for this Transaction, we do not expect a rate adjustment to take effect during the term of this engagement.
5.2 Billing Practices
Invoices will be rendered monthly and will be transmitted to the Client via electronic mail to the attention of Veronica Suárez-Pellegrino at such email address as the Client may designate. All invoices are due and payable within thirty (30) days of the invoice date. All invoices will reference C&H Matter Number 40225.00001 and will contain a detailed description of the services rendered and the time expended by each timekeeper during the billing period.
Time will be recorded in increments of one-tenth (0.1) of an hour (i.e., six-minute increments). Each time entry will include a description of the work performed that is sufficient to enable the Client to evaluate the services provided.
The Firm reserves the right to charge for reasonable out-of-pocket disbursements and expenses incurred in connection with the engagement, including but not limited to: filing fees, recording fees, courier and messenger charges, travel expenses (at cost, including airfare, mileage, lodging, and meals when travel is required and authorized by the Client), document reproduction and printing charges, and charges for computerized legal research and database services. Disbursements and expenses will be itemized on the monthly invoice separately from professional fees.
5.3 Retainer.  No retainer deposit is required at this time. The Firm reserves the right to request a retainer deposit in the future if circumstances warrant, including in the event that invoices remain unpaid beyond the thirty (30) day payment period described in Section 5.2.
5.4 Estimated Budget
Based on our current understanding of the Transaction, including the scope of services described in Section 3, the anticipated transaction timeline, and the complexity of the matters to be addressed, we estimate that total legal fees for this engagement will fall in the range of $175,000 to $225,000, exclusive of disbursements and third-party costs.
This estimate is provided for budgeting and planning purposes only and does not constitute a cap, ceiling, or fixed fee arrangement. Actual fees will depend on a number of factors that are not entirely within the Firm's control, including the complexity and duration of the Transaction, the extent and nature of title issues or defects identified during the diligence process, the findings of the environmental, survey, and other third-party investigations, the nature and extent of negotiation with Seller's counsel and the Lender's counsel, the number and complexity of lender requirements and loan documentation, and any unforeseen issues that may arise during the course of the engagement.
We will endeavor to keep the Client informed of billing progress throughout the engagement and will promptly advise the Client if, based on the status of the engagement at any point, we anticipate that total fees will exceed the estimated range set forth above. We are committed to delivering our services efficiently and cost-effectively and welcome an open dialogue with the Client regarding budget matters at any time.
6. Conflicts of Interest
We have conducted a conflicts check in accordance with the Firm's standard procedures and the applicable Rules Regulating the Florida Bar, including Rules 4-1.7 (Conflict of Interest; Current Clients) and 4-1.9 (Duties to Former Clients).
Based on our review, we have identified no conflicts of interest that would preclude this engagement or that would require the Client's informed consent under the applicable Rules of Professional Conduct. Specifically, the Firm does not currently represent, and has not within the preceding twenty-four (24) months represented, any of the following persons or entities in any matter that is the same as or substantially related to this Transaction or in any matter adverse to PCG:
•  Saltaire Hospitality Holdings LLC
•  Saltaire Opportunity Fund I LLC
•  Saltaire Management Co. LLC
•  Nathaniel Whitford
•  Elaine Chastain-Park
•  Meridian Coast Bank, N.A.
•  Seaview National Lending Corp.
•  Any affiliate, subsidiary, or related entity of any of the foregoing
If a potential conflict of interest arises during the course of the engagement, we will promptly notify the Client and will address the matter in accordance with the applicable professional responsibility rules, including, if appropriate, seeking the Client's informed written consent to continued representation after full disclosure of all material facts and circumstances.
By signing this Letter, the Client acknowledges that Calderwood & Harkness LLP is a large, multi-office law firm with a diverse client base and that the Firm may represent other clients in unrelated matters whose interests may differ from those of PCG. The Firm's representation of PCG in connection with this Transaction does not preclude the Firm from representing other clients in matters unrelated to this Transaction, even if such other clients may have interests that are generally adverse to PCG in other contexts, provided that such representation does not create a conflict under the applicable professional responsibility rules.
7. Confidentiality
All information provided to us by or on behalf of the Client in connection with this engagement will be treated as confidential and privileged to the fullest extent permitted by applicable law, including the attorney-client privilege and the work-product doctrine. The Firm will implement appropriate administrative, physical, and technical safeguards to protect the confidentiality and security of the Client's information.
We will not disclose confidential information to any third party without the Client's prior written consent, except as required by law, court order, or regulatory obligation, or as necessary to carry out the purposes of the engagement. In the ordinary course of this Transaction, it will be necessary for us to communicate with and share certain information with the Seller's counsel, the Lender's counsel, the title company, the surveyor, the environmental consultant, governmental authorities in connection with filings and recordings, and other parties to the Transaction. The Client's execution of this Letter constitutes the Client's consent to such disclosures as are reasonably necessary in furtherance of the representation and the consummation of the Transaction, provided that we will exercise reasonable judgment regarding the nature and extent of information shared with such third parties.
8. Document Retention
Upon conclusion of the engagement, the Firm will retain the client files (including both physical and electronic files) in accordance with the Firm's standard document retention policy, which currently provides for a minimum retention period of seven (7) years from the date of matter closure. Following the expiration of the retention period, the Firm reserves the right to destroy client files in accordance with its standard document destruction procedures, without further notice to the Client.
Original documents will be returned to the Client upon request at any time during or following the engagement. The Client is encouraged to request return of any original documents in the Firm's possession promptly upon the conclusion of the engagement. The Firm will not charge for the return of original documents but may charge for the cost of reproducing copies of file materials requested by the Client.
9. Termination
Either party may terminate this engagement at any time, with or without cause, upon written notice to the other party. In the event of termination by the Client, the Client will remain responsible for payment of all fees and disbursements incurred through the date of termination, including fees for services rendered and expenses incurred up to and including the date on which the Firm ceases work on the matter.
In the event of termination by either party, the Firm will take all steps reasonably necessary to protect the Client's interests in the Transaction, including cooperating in the orderly transition of the matter to successor counsel designated by the Client. The Firm will promptly deliver to the Client or its successor counsel all client files, documents, and materials in the Firm's possession relating to the engagement, subject to the Client's payment of all outstanding invoices.
The Firm's right to terminate this engagement is subject to the requirements of the applicable Rules of Professional Conduct, including the obligation to provide the Client with reasonable notice and an opportunity to retain successor counsel before the Firm's withdrawal becomes effective.
10. Governing Law
This engagement letter and the relationship between Calderwood & Harkness LLP and Pellegrino Capital Group LLC in connection with this matter shall be governed by and construed in accordance with the laws of the State of Florida, without regard to its conflict-of-laws principles. Any dispute arising out of or relating to this Letter or the engagement described herein shall be subject to the exclusive jurisdiction of the state and federal courts located in Miami-Dade County, Florida.
11. Acceptance and Agreement
We respectfully request that the Client review this Letter carefully and, if the terms accurately reflect our mutual understanding of the engagement, execute and return a copy of this Letter to our offices to confirm the Client's agreement with the terms and conditions set forth herein. A duplicate original is enclosed for the Client's records. Alternatively, a signed PDF copy transmitted via electronic mail to angela.fontaine@calderwoodharkness.com shall be deemed an original for all purposes.
This engagement is effective as of June 20, 2025. We are eager to commence work on this Transaction and look forward to a productive and successful engagement.
If you have any questions or would like to discuss any of the terms of this Letter, please do not hesitate to contact me directly at (305) 884-7210 or angela.fontaine@calderwoodharkness.com.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Name: Angela Fontaine
Title: Partner — Responsible Partner, Real Estate Practice Group
By: ________
Name: Douglas Fairchild
Title: Partner — Billing Partner, Real Estate Practice Group
Calderwood & Harkness LLP 1450 Brickell Avenue, Suite 3100 Miami, Florida 33131
AGREED AND ACCEPTED:
The undersigned, on behalf of Pellegrino Capital Group LLC, hereby confirms that the undersigned has read and understands the terms and conditions of this engagement letter, and hereby agrees to be bound by such terms and conditions.
PELLEGRINO CAPITAL GROUP LLC
By: ________
Name: Veronica Suárez-Pellegrino
Title: General Counsel
Date: ________
Enclosures:
•  Duplicate original of this Engagement Letter
cc:
Marco A. Pellegrino, Managing Principal, Pellegrino Capital Group LLC Rafael Dominguez, Calderwood & Harkness LLP Cynthia Ho, Calderwood & Harkness LLP
Timekeeper Category | Hourly Rate
Partners | $895.00 per hour
Senior Associates | $625.00 per hour
Associates | $475.00 per hour
Paralegals / Legal Assistants | $275.00 per hour

CALDERWOOD & HARKNESS LLP Attorneys at Law

VIA ELECTRONIC MAIL AND HAND DELIVERY

CALDERWOOD & HARKNESS LLP

AGREED AND ACCEPTED:

PELLEGRINO CAPITAL GROUP LLC

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