Case 1:04-cv-00725-RPM
Document 41-37
Filed 07/01/2005
Page 1 of 4
LEWI LEWIS
BRISBOI BRISBOIS
BISGAARD
AT LAW
SMITH
LLP
ATTORNEY ATTORNEYS
MAR15 JJN
NEW
100
PHONE
WALL
STREET
NINTH FAX
FLOOR
NEW
YORK
YORK
100053701 WWWLBBSLAWCOM
2122321300
2122321399
WEBSITE
THOMA THOMAS EMAIL
M
SANFORD
MARCH
10
2004
FILE NO 2645781
DIRECT DIAL
212 2321309 SANFORDLBBSLAWCOM
VIA AND
FACSIMILE FIRST CLAS CLASS
303
2912400
MAIL
LEONARD H
MACPHEE ESQ
PERKIN PERKINS COIE 1899 S WYNKOOPTREET 802021043 WESTCHESTERFIRE INSURANCE
SUITE 700
DENVERCO
RE
PROTECTIONINSURANCE MANAGEMENT INSURED POLICIE POLICIES CLAIM NO MATTER THE DON G21635662
COMPANY POLICY QUIZNO CORPORATION QUIZNOS
002 DON 648451
X390L9630918 WILLIAM H NICKERSON F RICHARD SCHADEN RICHARD QUIZNO CORPORATION QUIZNOS SCHADENMARK L BROMBERG ERIC
V
THE
E
LAWRENCE AND JOHN
TODD
DEAR LEN AS YOU KNOW WE ARE COUNSEL WESTCHESTERIRE INSURANCE COMPANY TO F WESTCHESTER AND ITS CLAIMS ADMINISTRATOR ACE CLAIM USA THI THIS WILL ACKNOWLEDGE OF ACE RECEIPT YOUR DATED 2 THE COMPLAINT IN CORRESPONDENCEJANUARY3 2004 ENCLOSING COPY OF THE COMPLAINT THE CAPTIONED MATTER THEACTION INDEX NUMBER 04CV0455 AND FILED IN THE DISTRICT BEARING COURT FORTHE CITYAND COUNTYF DENVER STATE OF COLORADO ALL CAPITALIZED O TERM TERMS USED HEREIN SHALLHAVE THE MEANINGS FORTHIN THE CAPTIONED SET UNLES UNLESS OTHERWISE SPECIFIED POLICIE POLICIES MEANING W NO PROVIDED WITH COPIES THE COMPLAINT ESTCHESTER POLICY ONLY COPIE OF N POLICY WESTCHESTER POLICYO D0N648451 THE 2001 02 POLICY AND COLLECTIVELY THE 200304 WITH POLICY THE POLICIES AND CERTAIN RELATED POLICIE I AND ALL OUR ANALYSIS PRELIMINARY ON BEHALF OF WESTCHESTER MUST RESERVE WE CORRESPONDENCE ANALYSIS UNDER THE POLICIES AND THE APPLICABLE POLICIE LAW THE COMMENTS COMMENT SET FORTHBELOW RELATETO SUCH RIGHT RIGHTS POLICIE QUIZNO CORPORATION QUIZNO QUIZNOS OR THE COMPANY AND COVERAGE UNDER THE POLICIES FOR THE QUIZNOS THE INDIVIDUAL DEFENDANTS AS MAY BE IMPLICATED THE COMPLAINT DEFENDANT THE COMMENT BY ALTHOUGH COMMENTS ARE AS
WE
HAVE BEEN
DON
G21635662002
THE 200304
LOS ANGELES ANGELE 2132501800
SAN FRANCISCO 4153622580
SAN
DIEGO
COSTA MESA 7145459200
SAN BERNARDINO
SACRAMENTO 9165645400
NEW
YORK
LAS
VEGA VEGAS
6192331006
9093871130
2122321300
7023669212
4850041692161
QWEST00325
Case 1:04-cv-00725-RPM
Document 41-37
Filed 07/01/2005
Page 2 of 4
LEWI LEWIS
BRISBOI BRISBOIS
BISGAARD
L
LEONARD H MARCH
MACPHEEESQ
2004
10
PAGE
OFFEREDBASED THATWE
OR OUR
ON
THE ALLEGATIONS CONTAINED IN THE COMPLAINT WE ALLEGATION
DO NOT WISH TO
ARE
SO IMPLYIN DOING
CLIENT BELIEVE SUCH ALLEGATIONS TRUE RATHERE CLIENTS TO W ALLEGATIONBE
ISSUE POTENTIAL COVERAGE ISSUES
THI THIS TO TAKING OPPORTUNITY
AS AN RESPONSIBILITY
INFORM YOU OF INSURER THE
IN ACCORDANCE WITH WESTCHESTERS WESTCHESTER
COMPLAINT THE ACTION WAS
SHARE COMPANY BROUGHT BYPLAINTIFFFORMER OWNER OF 18000 SHARES OF THE COMPANYS WHICH HE TENDERED THE COMPANYURSUANT ITS NOVEMBER 13 2000 OFFERTO TO TO COMMON STOCK P SHARE SHARES OF QUIZNOS TRADED COMMON STOCK FOR 800 ALL OUTSTANDING QUIZNO PUBLICLY PER SHARE PURCHASE OF CLAS CLASS OF SHAREHOLDERSWHO SHAREHOLDER TO THE TENDER OFFER THE ACTION PURPORTS BE ON BEHALF PURPORT A DIRECTOR DIRECTORS IN THE TENDER OFFER THE COMPLAINT NAME NAMES THE COMPANYND THE FOLLOWING PARTICIPATED CHIEF EXECUTIVE OFFICER AND OFFICERSOF QUIZNOS DEFENDANTS RICHARD E SCHADEN OFFICER PRESIDENT QUIZNO AS DEFENDANT AND CHAIRMAN OF THE L AND MARK BOARD RICHARD F SCHADENVICE PRESIDENT ECRETARY DIRECTOR S AND JOHN J TODD DIRECTORCOLLECTIVELY THE E DIRECTORRIC LAWRENCEDIRECTOR BROMBERG
INDIVIDUAL
DEFENDANTS
THE FIRSTSTEP OF
COMPANY PRIVATE THE THE OF TRANSACTION FOLLOWING EXPIRATION THE TENDER OFFER ON DECEMBER 11 2000 THE THE WHEREBY QUIZNO QUIZNOSCONSUMMATED COMPLETED SECOND STEPOF THE TRANSACTION COMPANY THAT WITH THE FIRENZE CORP COLORADO REVERSE CORPORATION WAS WHOLLYOWNED THE BY MERGER SHARE THE SQUEEZE TO WHICH THE REMAINING SHAREHOLDER RECEIVED 850 SHAREHOLDERS PER SCHADEN PURSUANT SCHADENS AND IT WAS COMPLETED OUT MERGER THE SQUEEZEOUT WAS ANNOUNCED ON MAY 22 2001 MERGER
THE TENDER OFFERWAS
TWOSTEP PLANTO
TAKE THE
ON
DECEMBER21 2001
THE
CLAS CLASS OF OF MINOR THOSE MADE IN ANOTHER MATTER BY ALLEGATION THE COMPLAINT ALLEGATIONS THAT THE PRICE IN THE SECOND STEPSQUEEZEOUT SHAREHOLDER SHAREHOLDERSPARTICIPATING MERGER PAIDIN THE DUTIE DUTIES BY THE DIRECTORSTO THE DIRECTOR AND TRANSACTION WAS INADEQUATE CONSTITUTED BREACH OF FIDUCIARY THE COMPLAINT C SEBESTAV RCHARD E SCHADEN ET AL SHAREHOLDERS EDWARD MINORITY CONSIDERATION FORTHEIR SHARES SEEK THATTHE CLASS RECEIVED INADEQUATE CLAS SHARE AND SEEKS TO ESSENTIALLY ALLEGE ALLEGES IN DISSENTER RIGHT DISSENTERSRIGHTS ACTION IN WHICH THE BOLSTERITS ALLEGATIONS ALLEGATION REFERENCINGRECENT OPINION BY IN THE SQUEEZEOUT VALUATION SHAREHOLDER SHAREHOLDERSWHO DISSENTED TO THE 850 MERGERSTEPOF THE FOR AND TRANSACTION SOUGHT THEIR STATUTORY APPRAISAL RIGHT RIGHTS THE COURT DETERMINEDTHE FAIR PRICE BE 3250 SHARE THE QUIZNOSCORPORATION V TO QUIZNO PROCEEDING PER PURPOSE PURPOSES OF THE APPRAISAL WILLIAM S THE
FAGAN ET A
DEFENDANT DEFENDANTS INCLUDING BREACH OF ASSERT ASSERTS FOUR CAUSES OF ACTION AGAINST CAUSE COMPLAINT AND ABETTING BREACH OF FIDUCIARY THE ALL DEFENDANT FIDUCIARY AS AGAINST DIRECTORDEFENDANTS AIDING DUTY VIOLATION VIOLATIONS OF ALL DEFENDANTS UNJUST ENRICHMENTAS AGAINST QUIZNO QUIZNOS AND DUTY AGAINST DEFENDANT ALLDEFENDANTS SECURITIE ACT CRS COLORADO SECURITIES AGAINST 1151501A
4850041692161
QWEST00326
Case 1:04-cv-00725-RPM
Document 41-37
Filed 07/01/2005
Page 3 of 4
LEWI LEWIS
BRISBOI BRISBOIS
BISGAARD
LLP
LEONARD H MARCH
MACPHEE ESQ
2004
10
PAGE
COVERAGE
ANALYSI ANALYSIS
AS REPORTED CLAIM
INSURED INSUREDS UNDER THE 200304 AGAINST OF THE 200304 THE NICKERSON MATTER IS EXCLUDED UNDER EXCLUSION AL POLICY POLICY HOWEVER WHICH PROVIDES THATTHE INSURER SHALLNOT BE LIABLEFORLOSS ON ACCOUNT OF ANY CLAIM MADE AGAINST LOS PROVIDE THE NICKERSON MATTER
WAS
MADE
ANY INSURED
CIRCUMSTANCER SITUATION WHICH HAS BASED UPON ARISING OF OR ATTRIBUTABLE ANY FACT OUT TO O OF WHICH THIS POLICY THI IS RENEWAL OR BEEN THE SUBJECTANY WRITTENNOTICE GIVEN OF UNDER ANY POLICY
REPLACEMENT
FACT CIRCUMSTANCE THE ARISE ARISESOUT OF THE SAME FACTS AND CIRCUMSTANCES AND ALLEGES SAME ALLEGE COMPLAINT WHICH WAS THE SUBJECTNOTICE UNDER THE OF ACT ACTS WRONGFUL AS THE ABOVE REFERENCEDSEBESTA ACTION THE NICKERSON MATTER RELATES BACK TO THE SEBESTA MATTER RELATE 20012002 POLICY ACCORDINGLY OF THE 200102 AND COVERAGE WILL BE AFFORDED UNDER THE 200102 TO CLAUSE POLICY PURSUANT ITS TERMS AND CONDITIONS AND R TO TO TERM CONDITION POLICYSUBJECT SINGLEETENTIONSHALL APPLY THESE RELATED ISSUED MATTER MATTERS PURSUANT CLAUSE OF THE 200102 TO POLICY WE REFERYOU TO CORRESPONDENCE ON BEHALF OF WESTCHESTER DATED JANUARY 2002 FEBRUARY 2002 AND MARCH 19 2002 IN WHICH IS WESTCHESTER WESTCHESTERS COVERAGE POSITION MORE FULLY FORTH WESTCHESTER SPECIFICALLY SET ADOPTAND ADOPTS OF MADE IN RESPECT THE SEBESTA MATTER TO THE NICKERSON OF ALL RESERVATIONS RIGHTS RESERVATION RIGHT INCORPORATE INCORPORATES THE
MATTER
FORITS CONSENT TO RETAIN THE LAW FIRM OF MORRISON WESTCHESTER ACKNOWLEDGES REQUEST ACKNOWLEDGE YOUR TO REPRESENT LLP FOERSTER MOFO QUIZNO QUIZNOSIN THE NICKERSON MATTER WESTCHESTER HAS RUDNICK TO REPRESENT CONSENTED TO THE RETENTIONOF THE LAW FIRM OF PIPER QUIZNO IN QUIZNOS THE ALREADY THAT ONLY THOSE REASONABLE AND CLAUSE 2D OF THE 200102 SEBESTAMATTER POLICY PROVIDE PROVIDES INSURED CLAIM FEE FEES AND EXPENSES INCURREDBY INSUREDS IN DEFENSE OF CLAIMS FALLWITHIN COST CHARGE EXPENSE NECESSARY COSTSCHARGES WHICH ARE SUBJECTCOVERAGE AS LOSS ACCORDINGLY WESTCHESTER THE DEFINITIONOFDEFENSECOSTS COST TO THAT THI W OR QUESTIONHETHER IT IS REASONABLE NECESSARY TO RETAIN NEW FIRM AT THIS JUNCTURE IS QUESTIONS ITS RIGHT CONSENT TO THE OF THE TRANSACTION AND SPECIFICALLY RESERVE RESERVES TO UNFAMILIARWITH THE FACTS FACT OF FROM QUIZNO AS TO THE NEED FOR RETENTION NEW RETENTION OF MOFO PENDING EXPLANATION QUIZNOS AN COUNSEL RESERVATION OF RIGHT RIGHTS
DUTIE DUTIES TO WESTCHESTER INDEPENDENT OF COOPERATION ACE ALL OF WESTCHESTERS WESTCHESTER RIGHTS AS THIS COVERAGE ANALYSIS PRELIMINARY THI I RESERVE RESERVES RIGHT EXPRESSLY ANALYSIS THE WHETHER OR NOT REFERENCEDHEREININCLUDING RIGHT TO UNDER ITS POLICIESAT LAW AND IN EQUITY POLICIE IN THIS LETTER THI AND TO OTHER THAN THOSE EXPRESSLY FORTH SET GROUND DENYCOVERAGE BASED UPON GROUNDS THI TO ADDRESS ADDITIONALCOVERAGE ISSUES AS THEY ADDRES ISSUE ANDLOR AMEND THIS LETTER MAY ARISE SUPPLEMENT ENDORSEMENT ENDORSEMENTS AND DEFINITIONS DEFINITION BASED UPON ALL OF THE PROVISIONS EXCLUSION PROVISION TERM CONDITION EXCLUSIONS TERMS CONDITIONS FACT TO ACES ACE AND FOUND IN THE POLICIESTHEIR APPLICATIONS ANY ADDITIONAL FACTS THAT MAY COME POLICIE APPLICATION PLEASE NOTE THATTHE INSUREDS MAINTAIN INSURED
4850041
692161
QWEST00327
Case 1:04-cv-00725-RPM
Document 41-37
Filed 07/01/2005
Page 4 of 4
LEWI LEWIS BLUSBOIS BLUSBOI
BISGAARD
1FH
LEONARD H MARCH
MACPHEE ESQ
2004
10
PAGE
BY WESTCHESTER OR ON ITS BEHALF WAIVER OF ANY OF ITS RIGHTS UNDER THE POLICY LAW OR IN EQUITY AT ON THE SHOULDBE CONSTRUEDAS RIGHT THI THIS OR ANY PRIORORRESPONDENCEINSUREDS ENGAGINGANY PRIOR TO THE INSURED BY IN CONTRARY BYPROVIDING C DISCUSSION TO OR FUTUREDISCUSSIONS WITH THE INSUREDS INSURED OR BY PAYING AGREEING PAY ANY AMOUNT TO OR ON OR BEHALF OF THE INSUREDS WESTCHESTEREXPRESSLY NOT WAIVE ANY SUCH RIGHTS DOE DOES INSURED
AND
NO
ATTENTION
STATED HEREIN NOTHING
FURTHERACTION TAKEN
TO
THE EXTENT
THAT YOU
ARE
AWARE
OF ANY INFORMATIONTHAT WOULD INDICATE THAT THE
IS PRELIMINARY COVERAGE POSITION
WITH THAT INFORMATION AS ACE NOTIFY
SOON
AS
OR US INACCURATE FACTUALLY LEGALLY OTHERWISE PLEASE PROVIDE WESTCHESTERURTHERREQUESTS THE INSUREDS F THAT INSURED POSSIBLE REQUEST
ALL IN THI AND THE UNDERSIGNED PROMPTLY REGARDINGSIGNIFICANT DEVELOPMENTTHIS DEVELOPMENTS MATTER WITH COPIE OF TO A PROVIDECE AND THE UNDERSIGNED COPIES ALL SIGNIFICANT PLEADING PLEADINGS RELATING THE
ABOVEREFERENCED
OR
ACTION
ENSURE
THAT NEITHER THE INSUREDS INSURED NOR DEFENSE COUNSEL OFFER DISCUS DISCUSS FIRST DISCUSSING SETTLEMENT SUCH THE AND SETTLEMENT
WITH
THE W ACCEPTNY SETTLEMENTTHAT MAY IMPLICATE POLICY ITHOUT A AND OBTAINING WRITTEN CONSENT TO PROCEED WITH ACE PRIOR
THE UNDERSIGNED WITH INSURER INSURERSTO WHOM
PROVIDE OF COPIEOF COPIES ALL CORRESPONDENCE FORTHTHE COVERAGE POSITIONSALLOTHER SETTING POSITION THIS THI MATTER HAS BEEN REPORTED
RESOLUTION THE OF OUR CONTINUING DIALOGUE CONCERNING AND TRUST THAT THIS WILL FACILITATE THI VARIOU VARIOUS COVERAGE ISSUE DELINEATED YOUR PRIORORRESPONDENCE ISSUES IN C OF ANALYSI THI QUIZNO ANALYSISTHIS MATTER QUIZNOS
LEN
WE
ALSO LOOK FORWARD TO
VERYTRUL
URS
THOMA THOMAS M LEWI LEWIS
SANFORD OF
BISGAARD SMITH LLP
BRISBOI BRISBOIS
BEPCM
CC
GAIL
THE 1475
J
WILSON
VICE PRESIDENT RISK
MANAGEMENT
LLC
QUIZNO MASTER QUIZNOS
LAWRENCE 80202
DENVERCO
4850041692161
QWEST00328