Company: KG
Filing Date: 2025-03-24
Form Type: S-4/A
Source: 0001104659-25-027242
Chunk: 307

Company: Kestrel Group Ltd
Filing Date: 2025-03-24
Form: S-4/A
Chunk 307
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). The Company authorized 150 Class B units of which 63 units have been granted as of the year ended December 31, 2024. The Company believes such awards better align the interests of its employees with those of its unitholders. All of the units granted vest based on five years of continuous service. The cost for the service-based awards is expected to be recognized over a straight-line basis over a five-year period. Equity-based compensation cost related to the service-based vesting awards was $59,701 for the years ended December 31, 2024, and 2023 and is presented in salaries and benefits in the consolidated statement of operations. There is approximately $165,000 of unrecognized compensation expense which will be recognized over the next three years ending in December 2027.

The fair value of each award was estimated on the grant date using a Black-Scholes option pricing model that used the assumptions noted below and other valuation techniques.

<div align='center'>F-14</div>

TABLE OF CONTENTS

| ​ | Risk-free interest rate  | ​ | ​ | 3.2% to 4.3% | ​ |
| ​ | Expected volatility      | ​ | ​ |        44.7% | ​ |
| ​ | Dividend yield           | ​ | ​ |           0% | ​ |
| ​ | Expected term (in years) | ​ | ​ |            6 | ​ |

Expected volatility was based on historical volatility for guideline public companies that operate in the Company’s industry plus a qualitative adjustment due to the start-up nature of the Company. The expected term of awards granted represents management’s estimate for the number of years until a liquidity event as of the grant date. The risk-free rate for the period of the expected term was based on the U.S. Treasury yield curve in effect at the time of the grants. The dividend yield was based on the Company having no expectations of dividends being paid out in the future. Management considered the distribution priority schedule or “waterfall calculation” in its estimation process.

| ​                                             | ​ | ​ | Class BUnits |   |     |   | ​ | ​ | Weighted-AverageGrant-dateFair Value |   |       |   | ​ |
|:----------------------------------------------|:--|:--|:-------------|:--|----:|:--|:--|:--|:-------------------------------------|:--|------:|:--|:--|
| Nonvested, beginning of year,