Contract analysis

I. Interview Logistics Date of Interview: August 19, 2022. Location: The interview was conducted in person at the offices of Calderwood & Harkness LLP, 555 California Street, 40th Floor, San Francisco, California 94104, in Conference Room 40-B. The conference room was secured for the duration of the interview, and no other persons were present other than those identified below. Duration: The interview commenced at ap

II. Background on Richard Fong Mr. Fong provided the following background information at the outset of the interview. Full Name: Richard Fong. Title: Chief Financial Officer, Torchlight Mining Corp. Reporting Line: Mr. Fong reports directly to Søren Dalmqvist, the Chief Executive Officer of TMC. In addition, Mr. Fong reports functionally to the Audit Committee of the TMC Board of Directors. The Audit Committee is cur

III. Knowledge of the U.S. Specialty Minerals Division's Financial Performance A. Revenue and Profitability Trends Mr. Fong was questioned at length regarding the financial performance of the U.S. Specialty Minerals Division during the period relevant to the DOJ investigation (approximately January 2017 through August 2021). Mr. Fong described the U.S. Specialty Minerals Division as a "steady performer" within the TM

IV. Pricing Authority and Delegation Structure A. Authority for Pricing Decisions A significant portion of the interview was devoted to understanding the delegation of pricing authority within TMC, particularly as it relates to the U.S. Specialty Minerals Division. Mr. Fong explained that pricing authority within TMC is delegated to divisional management. This is consistent with TMC's decentralized organizational str

V. Knowledge of Gavin Holt and Holt's Departure Mr. Fong was questioned regarding his personal knowledge of Gavin Holt and the circumstances of Holt's departure from TMC. Mr. Fong stated that he knew Holt professionally. Holt was a "senior commercial leader" within TMC's U.S. operations and held the title of Vice President, U.S. Specialty Minerals Sales. Mr. Fong and Holt interacted at TMC's annual leadership meeting

VI. Knowledge of Competitor Interactions and Trade Associations Mr. Fong was questioned at length regarding his knowledge of any interactions between TMC personnel and competitors, as well as TMC's involvement in industry trade associations. Mr. Fong stated that he had no personal involvement with the North American Specialty Minerals Council ("NASMC") or with any other trade association or industry group in the spec

VII. Absence of Financial Irregularities Suggesting Awareness A. No Unusual Payment Flows Mr. Fong was asked whether TMC's finance function had, at any point during the 2017–2021 period, identified any unusual payment flows, off-books transactions, side agreements, consulting payments, rebates, or other financial irregularities in connection with the U.S. Specialty Minerals Division. Mr. Fong stated that no such irre

VIII. Involvement in Investigation-Related Financial Matters A. Litigation Reserve Mr. Fong was questioned about his involvement in the financial and accounting aspects of TMC's response to the DOJ investigation. Mr. Fong stated that he was directly involved in the establishment of TMC's initial litigation reserve in connection with the investigation. TMC established an initial litigation reserve of USD 30 million in

IX. Knowledge of TMC's Antitrust Compliance Program Mr. Fong was questioned regarding his knowledge of TMC's antitrust compliance program. Mr. Fong stated that he was generally aware that TMC had adopted a formal antitrust compliance policy in approximately 2014. He understood the policy to contain standard provisions prohibiting agreements with competitors on pricing, customer allocation, market division, and bid-ri

X. Assessment and Observations The following assessment reflects the observations and preliminary conclusions of the interviewing attorney based on the totality of the interview. Credibility: Mr. Fong was cooperative, responsive, and appeared forthcoming throughout the interview. He answered questions directly and did not appear to evade or deflect. His answers were consistent and measured, and he did not contradict

XI. Distribution and Retention This memorandum is to be maintained in the privileged attorney work-product file for Calderwood & Harkness LLP Matter No. 1039-00001. The memorandum shall be stored in accordance with the firm's document retention and information security policies applicable to privileged and confidential materials. Distribution of this memorandum is strictly limited to the following individuals: • Elai