Restaurant Programs of America Broker Services Presentation Presented

Restaurant Programs of America Broker Services Presentation Presented By: Dean Carras, President

About RPA and Our Key Strengths “The insurance industry recognizes us as the experts in the restaurant industry and the restaurant industry recognizes us as the insurance experts. ” -Dean J. Carras Ø Highly experienced and knowledgeable staff of insurance experts in the restaurant industry Ø Respected by some of the most prestigious names in the restaurant industry Ø Developer of state of the art technology for our restaurant clients Ø Access to exclusive restaurant insurance products through our affiliate, Innovative Coverage Concepts Offices located in: * Parsippany, NJ * Langhorne, PA * Middlebury, CT * Palm Beach Gardens, FL * Asheville, NC * Kansas City, MO * Newport Beach, CA 2

A Few of Our Current Clients Ø EHI/Doherty Allendale, NJ Jerry Marcopoulos - (201) 818 -4669 ext. 123 97 Casual Dining Locations Ø Hooters of America Atlanta, GA Matt Wickesburg - (770) 799 -2238 205 Casual Dining Locations Ø Miller’s Ale House Jupiter, FL Mark Peterson - (561) 427 -0055 Ø Rose Casual Dining Newtown, PA Jeff Warden - (215) 867 -1851 60 Casual Dining Locations Ø Starr Restaurant Group Philadelphia, PA Bruce Koch - (267) 238 -3668 26 Fine Dining Locations Ø Restaurants-America Chicago, IL Ted Kasemir - (847) 510 -2500 22 Casual Dining Locations Ø TL Cannon Ponte Vedra Beach, FL Ritch Mabry - (904) 273 -9558 ext. 111 62 Casual Dining Locations Ø Passion Foods Washington, DC David Wizenberg - (202) 393 -1510 10 Fine Dining Locations Ø Commander’s Palace New Orleans, LA Arlene Nessor - (504) 896 -7626 4 Fine Dining Locations 62 Casual Dining Locations 3

Our Value Proposition Ø At RPA, we take pride in delivering the best products and services to our clients through a focused and specific approach we take in the following areas: § Coverage Analysis and Program Structure § Marketing/Underwriting § Written Commitment With Service Standards § Loss Prevention/Safety § Claims Mitigation § Analytical Tools § Assistance in Risk Management Services For Franchisees 4

Coverage Analysis and Program Structure We will conduct a full coverage analysis at each renewal to ensure that your exposures are being properly addressed and that the appropriate program structure is in place. Sample Coverage Analysis and Recommended Coverages Format 5

Marketing/Underwriting The measurable improvements that we have helped our clients achieve in their overall loss picture, coupled with our detailed carrier submissions, gives us a compelling story to tell our underwriters, which enables us to provide broader terms and conditions, as well as lower rates. Sample of a few points included in a recent submission to strengthen the perception of our client’s risk: “We started working with ABC Restaurant in April of 2011. ABC had adverse experience with general liability as well as liquor liability claims. We worked with ABC to implement and monitor a number of Risk Management initiatives which were designed to reduce the frequency and severity of liability claims especially liquor, and slips and falls. Among the initiative implemented were: § A written corporate policy regarding the service of alcoholic beverages which includes a set of procedures to monitor patron’s alcohol consumption, alerting managers if any party or individual orders a third drink, offering free food, coffee, ordering and paying for cabs, alerting local authorities if a patron refuses cab, etc. All managers then attended a seminar on the new policy when it was rolled out in late 2011. This policy has also become a permanent part of the training module. § We have audited and totally redesigned ABC’s claims / incident reporting procedures in order to make sure that when an incident occurs, we have put ourselves in the best possible position with regards to defending the claim. Initiatives in this regard include: ü Web based online incident / claim reporting ü Reporting forms prefilled with pertinent information including a number of “drop down” dialog boxes embedded in the forms so that we can make sure we capture important information such weather conditions, location within the restaurant, condition of floors, lighting, etc. ü We have provided webinar based training on an ongoing basis to ensure that store managers are able to access the forms and know how to fill them out. ” 6

Written Service Commitment Day to Day Management of Your Account In addition to the services outlined in this proposal, this is the service you can expect from us if we have the privilege of writing your account: Upon Receiving Your Order to Bind Coverage § Upon receiving the order to bind coverage from you, you will receive the following: • • A revised version of our proposal incorporating any changes or revisions that are made as a result of our proposal meeting, A binder of insurance which will serve as evidence of coverage outlined in the proposal until the actual policies are received from the carrier, Automobile Insurance Identification cards (if applicable), A claims kit which includes all of the forms and instructions in order for you to submit any type of claim to us, Your copies of any certificates of insurance which are required by your landlords, loss payees, mortgagees, and other creditors or leinholders, An invoice reflecting the premiums for all bound coverages, and A premium financing agreement (if applicable). Within Five Days of Binding Coverage § Online Claims Set-Up Meeting: Within 5 days of binding coverage, the senior members of your service, claims and loss control service teams will conduct an online claims setup meeting in order to introduce themselves and review the claims process with you. 7

Written Service Commitment (cont’d) Day to Day Management of Your Account Ongoing Service Items § You will receive copies of claims acknowledgments within one day of the initial report. § Your copy of certificates of insurance requested by you will be mailed to you within 24 hours of your request for the certificate unless you request it sooner, in which case it will be sent immediately by fax, hand or overnight mail. § Loss runs will be sent to you on a quarterly basis, or at whatever periodic intervals you require. § All requests for endorsements (changes to your policies) will be acknowledged within 24 hours. § All phone calls will be returned within 3 hours or before the close of business on that day whichever is sooner. § All correspondence from you will be responded to within 24 hours and acknowledged in writing. 120 Days in Advance of Each Renewal § At one hundred and twenty (120) days in advance of each renewal, the Account Service Team will update all information and present your insurance program favorably to selected carriers. Negotiations will be undertaken on your behalf with all carriers to insure the most favorable renewal terms and conditions. 8

Written Service Commitment (cont’d) Risk Management Service Plan 9

Loss Prevention Services Ø Loss Prevention is the most overlooked aspect in many insurance programs § The vast sums of money spent on “loss prevention” each year by clients and carriers are mostly wasted. So-called “loss prevention services” from insurance carriers are typically no more than simple inspection services and/or libraries for secondary information on loss prevention techniques, which are often not utilized. Ø Our approach is much more focused and economical § Using the tools and techniques we have developed in our experience insuring restaurants, we find out exactly where losses are coming from and develop practical, cost-effective ways to help prevent future incidents. 10

Loss Prevention Services (cont’d) Ø Risk Management Committee (RMC) § The purpose of the RMC is: • Create a forum for representatives from your organization, RPA, and the insurance carrier to review your claims/loss activity and collect pertinent information; • Determine the root causes of your losses; • Discuss and develop practical solutions/strategies for mitigating these losses and preventing future claims; • Establish action items and timelines for implementing corrective measures; • Monitor the effectiveness of these measures. § The RMC meets periodically throughout the year § RPA tracks various claims performance indices from period to period (quarterly, semi-annually, etc. ), and uses the change in these indices to determine the effectiveness of the Risk Management Program we have implemented. 11

Loss Prevention Services (cont’d) Sample of a few action items that resulted from a recent Risk Management Committee Meeting: 1. The committee has observed a pattern of employee cut claims arising out of employees using knives to open bags. It was determined that the use of the "Viper" and "Pouch – Mate" bag openers could alleviate this problem. ACTION – RPA will provide vipers and pouch made bag openers for use in the ASI stores. Responsibility – Gundi Completion due date – June 30, 2012 2. Written self – audits are completed by ASI on each store annually. In addition, ABC International inspects a random sample of stores each year. Also, Chartis has committed to conducting physical surveys of 10 locations in the current policy term. ACTION – RPA will do a store ranking by frequency and incurred dollars in order to determine which stores we would like to have surveyed. Responsibility – Nick Galakis Completion due date – June 30, 2012 3. In the claims review, several claims involved guests slipping on wet floors in the bathrooms. The notes in one of the claims suggested that the protocol is to inspect bathrooms four times per hour and another claim suggested that the protocol was to check the bathrooms once per hour. There also seems to be some confusion as to whether or not the stores are required to keep paper logs of the bathroom inspections. It was determined that Debbie will double check on the protocol that is currently in place. The committee generally agreed that it was not a good idea to keep any sort of log with regard to the bathroom inspections, as this information is discoverable and could tend to weaken our position in the defense of the claim. ACTION – Determine the protocol for inspecting bathrooms on an hourly basis. Responsibility – Marc Fabrizio will contact Debbie to confirm status of current protocol. Completion due date – May 30, 2012 12

Loss Prevention Services (cont’d) Ø Loss Control Engineering Surveys § Our proposed services include the following: • We will conduct a survey at the corporate level of your existing operational policies and procedures for safety and loss control in the areas of General Liability, Workers’ Compensation, and Property exposures in order to make sure that all potential exposures to loss are addressed. • We will compile a General Liability, Workers’ Compensation and Property claims analysis and develop a Loss Cause Analysis to identify Loss Leader Categories and Loss Leader Locations. • We will conduct field surveys at a select number of locations in order to audit compliance with corporate policies, and to identify specific hazards and conditions, both physical and operational which can lead to losses. We will also offer suggestions for improvements for any such hazards and conditions. 13

Loss Prevention Services (cont’d) Ø Lease and Contract Review Sample of a few observations/recommendations we made to a client regarding one of their leases Ø As you surmised, the lease only requires you to insure your trade fixtures, equipment, inventory, and other contents. (See Item 7. (2)) You definitely are not required to insure the building. Item 6. (b) reinforces this fact by indicating that the Tenant is to pay all charges passed through to the Landlord, including the Landlord’s share of the cost of insuring common areas. Furthermore, in a strip center with many tenants, it would be improbable that you would be responsible for insuring the entire center and it would be impossible to insure just the portion of the building you occupied. In all such centers, the Landlord insures the building and, often, each tenant must pay its proportionate share of that cost. That certainly seems to be the case here. Ø If the building had a fire loss, the insurance carrier insuring the building for the Landlord would be required to pay for the damage to the building and your insurance carrier would be required to pay for the damage to your fixtures, equipment, inventory and other contents. While the lease makes no mention of improvements and betterments, contents coverage normally covers the cost of such I&B’s if you have paid for them. Ø The Landlord’s request to increase the limits of your insurance from $1 Million to $1. 6 Million is unjustified. Many leases contain a provision allowing the Landlord to require increases in coverage after a certain period of time has elapsed or based on what similar risks in the same geographical area normally carry. Often, such clauses use the word “reasonable. ” However, there is no such provision in this lease. Ø Item 26. (a) contains an indemnification provision for any liability or costs arising from Tenant’s use of the premises, any breach of the lease, or any other act or omission of the Tenant. While not unusual, this indemnification provision is quite broad, requiring Tenant to indemnify for a wide variety of acts or omissions. You should be aware that insurance companies will insure such an indemnification obligation only as respects tort liability. Your obligation to defend other claims not involving personal injury or property damage are outside the scope of insurance. Interestingly, indemnification for tort liability (which is covered by your insurance) is included in the Tenant’s requirement, but not in the Landlord’s requirement. 14

Loss Prevention Services (cont’d) Ø Restaurant Risk Management Technology 15

Claims Mitigation Ø Left to their own devices, insurance company claims departments and TPAs do not give their claim files the amount of attention that we feel is necessary to keep losses to an absolute minimum. Our claims mitigation process includes the following: • Prompt investigation • File documentation • Reserve setting • Frequent follow-up • Periodic claims review meetings • Reserve underwriting alerts • Underwriting alerts • Access to adjuster notes • Acu. Comp 16

Analytical Tools Ø Focused Loss Analysis RPA has come up with statistical methods which are useful in measuring the effectiveness of the RPA Risk Management Program. Some of these techniques are listed below: § Analysis of your historical losses and exposures § Establish “grades” § Set Benchmarks and Goals • • Average Claim Size # of Claims per $ Sales % of Claims Closed Without Payment $ Claims per $ Sales RPA tracks various claims performance indices from period to period (quarterly, semi-annually, etc. ), and uses the change in these indices to determine the effectiveness of the Risk Management Program we have implemented. 17

Analytical Tools (cont’d) Sample Workers’ Compensation Claims Performance Exhibit 18

Analytical Tools (cont’d) Sample General Liability Claims Performance Exhibit 19

Risk Management Services for Franchisees Ø Best Practices - Safety Protocols Ø Access to customized web-based risk management tools Ø Establish uniform insurance requirements Ø Explore potential for developing specific insurance program for your franchisees 20

National Accounts Team Members DEAN J. CARRAS - President Dean Carras has spent more than 30 years in the insurance industry, focusing on specialty programs. Early in his career he foresaw how concentration on a market niche creates value for policyholders— better coverage at lower prices. Today, his companies have five offices and write thousands of restaurants throughout the country, including some of the most well-known and prestigious ones. As an individual who continually demonstrates results and an unswerving integrity, Dean has earned the trust and confidence of restaurateurs around the country as well as insurance industry executives. PAUL P. GIUNTO – Senior Vice President Paul Giunto’s early insurance career involved major posts at large brokerage firms, including Johnson & Higgins, Marsh & Mc. Lennan, and Aon. A graduate of St. Vincent College, Paul earned his CPCU designation in 1977. He has been involved in high levels of responsibility for automation, property/casualty operations and creation of specialized insurance programs. Paul joined ICC’s senior management team early in 2009 and will be intimately involved in direct production, building a sales team, and assisting with the development of various new initiatives. JEFFREY M. HALLMAN - Vice President/National Accounts Jeff Hallman launched his career with a major insurance company more than 30 years ago, and is a cum laude graduate of the Wharton School, University of Pennsylvania. He specializes in large businesses with complex insurance needs, and his extensive experience with hospitality accounts is put to good use managing RPA’s National Accounts Department. PHILIP LIEBERMAN, CPCU, CLU – Vice President Phil Lieberman has over 35 years of experience in the insurance industry. He joined the firm at its inception and has since been involved in all aspects of the firm’s operations. Phil is a graduate of Yale University and is the firm’s primary resource for contract analysis and coverage issues. 21

National Accounts Team Members (cont’d) DAVID R. HAMBLETON – Senior Account Executive David’s industry experience spans more than 30 years beginning with his early years on the underwriting side at both Hartford Steam Boiler and Chubb. Most of his career has been spent on the brokerage side with international brokers such as Johnson & Higgins, Willis and Marsh, where he managed a portfolio of middle market property/casualty accounts and was responsible for program design, market negotiations, program implementation, and ongoing servicing. JOSEPH PEREZ – Senior Account Executive Joseph Perez has over 27 years of experience in the property casualty insurance industry as an underwriter, management consultant and broker. His expertise includes program design, marketing and coverage analysis. He is well verse in different risk financing techniques including guaranteed cost, large deductibles, self-insurance and captives. JUNE LEMONGELLO – Client Services Manager With more than 27 years of experience in the insurance industry, June Lemongello oversees marketing, underwriting and internal service activities for RPA. She has worked in Client Servicing in the restaurant division of The Dining Car Agency, Wachovia Insurance Services and now RPA. MARC FABRIZIO - Claims / Loss Control Manager Since 1988, Marc has been intimately involved with claims management. For over ten years, he was on the front lines of litigation defense, attending trials and arbitrations, conducting claims audits, and adjusting claims for major insurance companies and third party administrators. He will be working with clients in developing and implementing loss control protocols, as well as assuring that we provide excellence and responsiveness in our delivery of claims service. 22

National Accounts Team Members (cont’d) NICHOLAOS S. GALAKIS - Risk Management Specialist Nicholaos S. Galakis is a risk control professional with over twenty five years in property and casualty loss prevention and client management expertise. In addition to loss control, he has managed all aspects of broker relations and customer service including technology support, technical services, underwriting, claims, loss control & relationship growth. MARTIN D. MICK – Technology Development Specialist Martin D. Mick has been involved in the restaurant industry as operator, consultant and business service provider for 35 years. Early work included service as a senior executive of a 1400 -unit national chain. Through his own company he has provided specialized consultative services in the area of turnaround management, serving as CEO, COO and Board member for both public and private companies. He is the author of Food Safety Management and Compliance and has provided national media commentary on risk management related to the multi-unit restaurant environment. Mr. Mick is a developer of interactive web-based tools and custom digital services to the restaurant industry through Restaurant. Risk. Management. com. 23

What Can You Expect as a Result of Doing Business With RPA? Ø RPA will work diligently as your partner to deliver world -class insurance and risk management program designed to: § Get your losses down to an absolute minimum. § Relentlessly market your account to the insurance marketplace in order to get the lowest possible rates that the market will bear. § Help you in developing best practices and programs for your franchising operation. § Make sure your are covered appropriately for all of your exposures to loss. § Point out areas in which you are not currently insured. 24