Contract analysis

I. Executive Summary This memorandum analyzes the scope, applicability, and limitations of the directors' and officers' liability insurance policy issued by Garrison Mutual Insurance Co. (Bermuda) to Dunmore Energy Holdings Ltd. ("DEH" or the "Company"), Policy No. GM-DO-2021-08734 (the "Policy"), in connection with the investigation opened by the U.S. Department of Justice, National Security Division, Counterintelli

II. Background A. The DOJ Inquiry Dunmore Energy Holdings Ltd. is a Cayman Islands–domiciled holding company (Cayman Islands Monetary Authority Registration No. MC-334821) with its principal operational headquarters at 1200 McKinney Street, Suite 3400, Houston, Texas 77010. The Company is a diversified energy trading, logistics, and infrastructure enterprise with fiscal year 2021 revenues of approximately $4.87 billi

1. Callum Renshaw — Chief Executive Officer, Dunmore Energy Holdings Ltd. Mr. Renshaw is based in Houston, Texas. As CEO, he bears ultimate supervisory responsibility for the Company's operations and compliance programs. While there is no indication at this time that Mr. Renshaw had direct personal involvement in the flagged DTI transactions, his name appears prominently in the grand jury subpoena's document requests

2. Derek Hargrave — President, Dunmore Trading International Ltd. (Dubai). Mr. Hargrave is the senior executive directly responsible for DTI's trading operations and maintained direct oversight of the counterparty relationships at issue. Based on our preliminary internal investigation, Mr. Hargrave was involved in approving several of the suspect transactions and had interactions with representatives of Petronova Tra

3. Natasha Sorokin — Senior Trader, Dunmore Trading International Ltd. (Dubai). Ms. Sorokin is a Russian-American dual national who was the primary point of contact for transactions with the flagged counterparties. She was placed on administrative leave on May 16, 2022. Our internal investigation indicates that Ms. Sorokin executed the majority of the flagged trades and maintained the most extensive communications wi

4. Gerald Fisk — Former Chief Compliance Officer, Dunmore Energy Holdings Ltd. Mr. Fisk departed the Company on June 10, 2022, which was subsequent to the date of initial notice of the DOJ Inquiry but is relevant for coverage analysis under the Policy's "wrongful act" definitions and the treatment of former officers. Mr. Fisk's role is significant because the DOJ appears to be scrutinizing the adequacy of the Company

5. Sandra Whitfield — Chief Financial Officer, Dunmore Energy Holdings Ltd. Ms. Whitfield is based in Houston. She is referenced in the grand jury subpoena in connection with financial approvals and payment authorizations for certain of the flagged transactions.

6. Omar Al-Rashidi — Head of Middle East Operations, Dunmore Trading International Ltd. (Dubai). Mr. Al-Rashidi has been identified as a cooperating witness and has been providing information to Calderwood & Harkness in connection with the internal investigation.

7. Yves Leclerc — Director of Logistics & Shipping, Dunmore Trading International Ltd. (Dubai). Mr. Leclerc oversaw the physical logistics and shipping arrangements for the transactions at issue, including chartering and documentation.

8. Rajesh Malhotra — Controller, Dunmore Trading International Ltd. (Dubai). Mr. Malhotra was responsible for accounting and financial reporting for DTI's trading book and processed the financial entries for the flagged transactions.

9. Tobias Engel — Managing Director, Dunmore Renewables GmbH (Hamburg, Germany). Mr. Engel has tangential involvement arising from certain shared logistics resources between DTI and Dunmore Renewables GmbH and his participation in certain cross-subsidiary coordination calls where the flagged counterparties were discussed. As noted above, three individuals have retained personal counsel separate from Calderwood & Hark

III. Policy Summary — Garrison Mutual Policy GM-DO-2021-08734 A. Policy Identification The relevant policy is as follows: The Policy is a claims-made policy, meaning that it covers claims first made against the insured during the policy period or any applicable extended reporting period. The DOJ Inquiry was initiated on April 19, 2022, which falls squarely within the current policy period. A full copy of the Policy i

IV. Coverage Issues & Exclusion Analysis A. Government Investigation / Regulatory Action Exclusion Many D&O policies contain exclusions for claims arising from certain governmental or regulatory proceedings. We have reviewed the Policy and have not identified a blanket exclusion for government investigations or regulatory actions. To the contrary, the Policy's definition of "Claim" expressly includes formal governmen

V. Estimated Covered vs. Non-Covered Costs A. Projected Total Matter Costs Based on our preliminary assessment of the scope of the DOJ Inquiry, the anticipated duration of the investigation, and the resources required to defend the Company and its directors and officers, we project the following total matter costs: These estimates are preliminary and are based on assumptions about the duration and complexity of the i

VI. Notice and Claim Submission Requirements A. Timely Notice Obligation The Policy requires the insured to provide prompt written notice to the carrier upon becoming aware of a "Claim" or of circumstances that could reasonably be expected to give rise to a "Claim." The timely provision of notice is a condition precedent to coverage under most D&O policies, and a failure to provide timely notice can result in a denia