Company: KG
Filing Date: 2025-03-10
Form Type: S-4
Source: 0001104659-25-021993
Chunk: 73

Company: Kestrel Group Ltd
Filing Date: 2025-03-10
Form: S-4
Chunk 73
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 manage these relationships, it could materially and adversely affect the combined company’s business, operating results, financial condition and prospects.

If any of the combined company’s third-party service providers experience difficulties or terminate their services and the combined company’s is unable to replace them with other service providers, its operations could be interrupted. It may be difficult for the combined company to replace some of its third-party vendors, particularly vendors providing its core operational and technological infrastructure, in a timely manner if they were unwilling or unable to provide the combined company with these services in the future for any reason. If an interruption were to continue for a significant period of time, it could have a material adverse effect on the combined company’s business, financial condition or results of operations. Even if the combined company is able to replace them, it may be at higher cost, which could have a material adverse effect on the combined company’s business, financial condition or results of operations. In addition, if a third-party provider fails to provide the services the combined company requires, fails to meet contractual requirements, such as compliance with applicable laws and regulations, or suffers a cyber-attack or other security breach, the combined company’s business could suffer economic and reputational harm that could have a material adverse effect on its business, financial condition or results of operations.

Maiden’s reinsurers may not pay losses in a timely fashion, or at all, which could have a material adverse effect on the combined company’s results of operations or financial condition.

At December 31, 2024, Maiden had $568.3 million due to it from one reinsurer, Cavello Bay Reinsurance Limited (“Cavello”), consisting of losses recoverable from Cavello under a retrocession agreement of $35.4 million and reinsurance recoverable on unpaid losses under a retroactive reinsurance agreement of

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$532.9 million. Cavello provided collateral in the form of a letter of credit in the amount of $445.0 million to AmTrust under the Loss Portfolio Transfer and Adverse Development Cover Agreement (“LPT/ADC Agreement”) with Enstar Group Limited (“Enstar”) on July 31, 2019, pursuant to which Cavello assumed the loss reserves as of December 31, 2018 associated with a quota share reinsurance agreement between certain insurance subsidiaries of Maiden and AmTrust that went in run-off effective January 1, 2019, subject to additional collateral funding requirements. As of