1012-00006 · Stonefield Logistics Group · Engagement

engagement-letter-stonefield.docx DOCUMENT Litigation

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CONFIDENTIAL — ATTORNEY-CLIENT PRIVILEGED

CALDERWOOD & HARKNESS LLP Attorneys at Law 2200 Ross Avenue, Suite 3600 Dallas, Texas 75201 Telephone: (214) 553-8800 Facsimile: (214) 553-8801 www.calderwoodharkness.com

January 29, 2024

VIA EMAIL AND FIRST-CLASS MAIL

Diane Ostrowski, Esq. General Counsel Stonefield Logistics Group Inc. 4100 Commerce Street, Suite 1200 Dallas, Texas 75226

Re: Engagement of Calderwood & Harkness LLP — Breach of Contract Claims Against Ridgeline Freight Carriers LLC and Gerald Brashear Matter Number: 1012-00006

Dear Ms. Ostrowski:

1. Purpose and Engagement

Calderwood & Harkness LLP ("the Firm," "C&H," or "we") is pleased to confirm the terms of our engagement by Stonefield Logistics Group Inc. ("Stonefield," "SLG," or "the Company") as outside litigation counsel in the above-referenced matter. We appreciate the confidence that you and the Stonefield leadership team have placed in the Firm, and we look forward to providing the highest quality legal representation in connection with the claims described herein.

This engagement letter (this "Letter") sets forth the scope, terms, and conditions under which the Firm will represent SLG. It is intended to memorialize and supersede the understandings discussed during our initial meetings with you and with Marcus Ellington, Chief Executive Officer of SLG, on January 16 and January 22, 2024, respectively. We are grateful that you and Mr. Ellington chose to entrust this significant matter to our firm following those productive conversations, and we are committed to pursuing SLG's interests vigorously and efficiently.

Please review this Letter carefully. If the terms set forth below are acceptable, we ask that you execute and return a copy of this Letter as described in Section 14 so that we may promptly commence work on your behalf.

2. Scope of Representation

The Firm will represent SLG in connection with the pursuit of breach-of-contract claims and related contractual remedies against the following parties:

(a) Ridgeline Freight Carriers LLC ("Ridgeline"), an Oklahoma limited liability company registered to do business in the State of Texas, with its principal office located at 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159; and

(b) Gerald "Gerry" Brashear, individually, in his capacity as personal guarantor of Ridgeline's obligations under the agreement described below, residing at 2314 Quail Creek Drive, Edmond, Oklahoma 73034.

The claims arise from Ridgeline's material default under the Dedicated Freight Services Agreement dated April 15, 2022 (the "DFSA"), entered into between SLG (as "Shipper") and Ridgeline (as "Carrier"). As discussed in our initial consultations, SLG and Ridgeline negotiated the DFSA to govern the dedicated provision of Class 8 tractor-trailer freight transportation capacity across SLG's Southwest regional distribution network, including key lanes originating from SLG's Dallas and Fort Worth distribution centers.

Specifically, the Firm's representation encompasses the pursuit of liquidated damages and other contractual damages arising from the following acts and omissions by Ridgeline:

(i) Ridgeline's failure to provide the minimum dedicated trucking capacity of twelve (12) Class 8 tractor-trailers as required under Sections 3.1 and 3.2 of the DFSA, a deficiency that, based on information provided to date, began in approximately June 2023 and progressively worsened throughout the third and fourth quarters of 2023;

(ii) Ridgeline's failure to cure the foregoing defaults within the thirty (30) day cure period following SLG's written notice of material breach transmitted on October 18, 2023, in accordance with Section 12.2 of the DFSA; and

(iii) Ridgeline's complete and unilateral cessation of all operations and services under the DFSA on or about December 8, 2023, without prior notice to SLG and in direct contravention of the DFSA's termination provisions set forth in Article 12.

The scope of the Firm's representation in this matter shall include the following activities and proceedings:

• Pre-Suit Demand and Negotiation. The Firm will prepare and transmit a formal demand letter to Ridgeline and Gerald Brashear, setting forth SLG's claims and the basis for damages, and will engage in pre-litigation settlement negotiations to the extent SLG deems appropriate and strategically advantageous.

• Filing and Prosecution of Litigation. The Firm will prepare, file, and prosecute a civil action in the appropriate Texas state court of competent jurisdiction. Based on the DFSA's forum selection clause set forth at Section 18.2 of the DFSA, the anticipated venue for such proceedings is a district court of Dallas County, Texas. The Firm's prosecution of the litigation will encompass all phases, including pleadings, discovery (both written and depositions), motion practice, pretrial proceedings, trial, and any post-trial motions.

• Enforcement of the Personal Guaranty. The Firm will pursue enforcement of the personal guaranty executed by Gerald Brashear pursuant to Section 14.5 of the DFSA, under which Mr. Brashear personally guaranteed Ridgeline's payment and performance obligations, subject to a stated cap of Three Million Dollars ($3,000,000.00).

• Post-Judgment Enforcement and Collection. As may be necessary, the Firm will advise on and undertake post-judgment enforcement and collection proceedings, including but not limited to judgment domestication in Oklahoma or other jurisdictions, discovery in aid of judgment, garnishment, abstract of judgment filings, and related collection activities.

Matters Outside the Scope of This Engagement. Unless subsequently agreed in writing, the Firm's representation of SLG does not include, and the Firm assumes no responsibility for, the following:

(a) Regulatory proceedings before the Federal Motor Carrier Safety Administration ("FMCSA"), any state transportation or public utility authority, or any other governmental or regulatory body;

(b) Insurance coverage disputes, including but not limited to any claims under SLG's own commercial general liability, business interruption, or other insurance policies, or under any policies maintained by Ridgeline or its affiliates;

(c) Bankruptcy proceedings — should Ridgeline, Gerald Brashear, or any related entity file a petition for relief under the United States Bankruptcy Code (Title 11, U.S.C.), the Firm's representation in this matter would be stayed by operation of the automatic stay under 11 U.S.C. § 362, and separate engagement terms, including a potentially revised fee arrangement, would be required for representation in any bankruptcy proceeding; and

(d) Any matters, disputes, or claims unrelated to the DFSA claims described herein, including any other contractual relationships between SLG and third parties.

If during the course of this engagement we identify additional claims or issues that fall outside the scope described above but that may be relevant to SLG's interests, we will promptly advise you and discuss whether an expanded or separate engagement may be warranted.

3. Engagement Team

The following attorneys will be primarily responsible for providing legal services to SLG in connection with this matter:

Priya Anand — Responsible Partner. Ms. Anand will serve as the lead attorney and primary point of contact for SLG with respect to this engagement. Ms. Anand will oversee all aspects of the litigation strategy, coordinate with the engagement team and client contacts, manage significant court appearances and depositions, and maintain overall responsibility for the quality and direction of the Firm's work product. Ms. Anand is a partner in the Firm's Litigation & Dispute Resolution Practice Group and has extensive experience in complex commercial litigation, including breach-of-contract, supply-chain, and transportation disputes. She is admitted to practice in the State of Texas and the United States District Courts for the Northern and Eastern Districts of Texas.

Douglas Carmichael — Billing Partner. Mr. Carmichael will oversee the financial aspects of the engagement, including budgeting, invoice review, and coordination with SLG regarding billing inquiries. Mr. Carmichael will also provide strategic litigation counsel as needed and will serve as a secondary resource for executive-level client communications. Mr. Carmichael is a senior partner in the Firm's Litigation & Dispute Resolution Practice Group and has more than twenty-five years of trial and appellate experience.

Jeffrey Park — Lead Associate. Mr. Park will handle day-to-day case management, including the preparation and drafting of pleadings, motions, and discovery requests and responses. Mr. Park will also coordinate with expert consultants, manage the document review process, and assist with deposition preparation and attendance. Mr. Park is a senior associate who has been with the Firm for five years and has significant experience in commercial and contract litigation matters.

Yuki Nakamura — Working Associate. Ms. Nakamura will assist the engagement team with legal research, document review, discovery analysis, and drafting support. Ms. Nakamura joined the Firm in 2022 and has contributed to a number of complex commercial litigation matters in the Firm's Dallas office.

From time to time, other attorneys, paralegals, litigation support specialists, and administrative support staff within the Firm may be assigned to work on this matter as the needs of the engagement require. The use of additional personnel will be managed to ensure both quality and efficiency. SLG will be notified promptly if there is any material change to the composition of the engagement team, including any change to the Responsible Partner or Lead Associate. In all events, Ms. Anand will maintain supervisory responsibility for the engagement.

4. Fee Arrangement

The Firm will bill SLG for professional services rendered in connection with this matter on an hourly basis. There is no contingency fee component to this engagement. SLG's obligation to pay the Firm's fees is not contingent upon or related to the outcome of the litigation or the amount of any recovery obtained.

The current standard hourly billing rates for the members of the engagement team are as follows:

Paralegal and legal assistant time will be billed at hourly rates ranging from $195.00 to $275.00 per hour, depending on the experience level of the individual assigned and the nature of the task performed. The specific rates for paralegals and legal assistants assigned to this matter will be reflected on the Firm's monthly invoices.

The foregoing rates are the Firm's standard rates, effective as of January 1, 2024. The Firm reserves the right to adjust its standard billing rates on an annual basis, typically effective as of January 1 of each calendar year. In the event of any rate adjustment, the Firm will provide SLG with advance written notice of the revised rates at least thirty (30) days prior to the effective date of such adjustment. Adjusted rates will apply to services rendered on or after the effective date of the adjustment and will not be applied retroactively to work previously performed.

All professional time is recorded and billed in increments of one-tenth (0.1) of an hour (i.e., six-minute increments). Each invoice will contain a detailed description of the services rendered by each timekeeper, the date of service, the time expended, and the applicable billing rate.

5. Costs and Expenses

In addition to professional fees for legal services, the Firm will bill SLG for out-of-pocket costs and disbursements reasonably incurred in connection with the representation. These costs and expenses are separate from, and in addition to, the fees for professional services described in Section 4 above.

Reimbursable costs and expenses may include, without limitation, the following:

• Court filing fees, service of process fees, and other court costs;

• Process server fees;

• Courier, messenger, and overnight delivery charges (e.g., Severin Partners LLC, Halcyon Partners LLC);

• Travel expenses, including transportation (airfare, mileage, rental car, taxi/rideshare), lodging, and meals, billed at the Firm's actual cost and in accordance with the Firm's standard travel reimbursement policies;

• Long-distance telephone charges and videoconference platform charges;

• Computerized legal research charges (e.g., Westlaw, Sundial Solutions, PACER);

• Photocopying, printing, scanning, and document reproduction charges;

• Expert witness fees, consultant fees, and related expenses (e.g., forensic accounting, financial analysis, asset tracing, industry experts);

• Court reporter attendance fees, deposition transcript costs, and videography charges;

• Mediation or alternative dispute resolution fees and costs;

• Electronic discovery hosting, processing, and review platform charges; and

• Any other costs or expenses reasonably and necessarily incurred in connection with the prosecution and enforcement of SLG's claims.

For any individual cost item, third-party vendor engagement, or expert witness retention that is expected to exceed Five Thousand Dollars ($5,000.00), the Firm will seek and obtain prior written or email approval from SLG (through Ms. Ostrowski or her designee) before incurring such expense. The Firm will endeavor to provide reasonable estimates where available and to identify cost-effective alternatives. SLG's approval of costs in excess of the $5,000.00 threshold will not be unreasonably withheld.

6. Billing and Payment Terms

The Firm will issue monthly invoices to SLG for professional fees earned and costs and expenses incurred during the preceding calendar month. Invoices will be directed to Diane Ostrowski, General Counsel, at the address set forth above, or to such other address or email as SLG may designate in writing. Invoices will include a detailed narrative description of services rendered, identified by timekeeper and date, together with an itemization of costs and expenses.

All invoices are due and payable within thirty (30) days of receipt by SLG. The Firm reserves the right to charge interest on any amounts that remain unpaid beyond the thirty-day payment period at the rate of one percent (1.0%) per month (equivalent to twelve percent (12%) per annum), or the maximum rate permitted by applicable law, whichever is less. Interest will accrue from the date the payment was due until the date the payment is received by the Firm.

SLG may direct any billing inquiries, questions regarding specific charges, or requests for additional billing detail to Douglas Carmichael or to the Firm's billing department at billing@calderwoodharkness.com or by telephone at (214) 553-8842. The Firm is committed to transparency in billing and will make every reasonable effort to address any billing questions or concerns promptly.

The Firm reserves the right to require an advance retainer deposit if, at any point during the engagement, the Firm reasonably determines that such a deposit is warranted based on the anticipated scope of upcoming work, the payment history on the account, or other relevant considerations. Any retainer deposit received will be held in the Firm's client trust account and applied against final invoices or refunded to SLG at the conclusion of the engagement, as appropriate.

7. Client Responsibilities

Effective and efficient representation requires the active cooperation of the client. SLG agrees to cooperate fully with the Firm in the prosecution of the claims described in this Letter, including by providing timely access to documents, records, electronic files, contracts, correspondence, financial data, and other information relevant to the matter, as well as making available for interviews, meetings, depositions, and testimony such SLG personnel as the Firm may reasonably request.

In particular, SLG agrees to the following:

(a) SLG will respond promptly to the Firm's requests for information, documents, and factual input, recognizing that delays in providing requested materials may adversely affect the litigation timeline and strategy;

(b) SLG will review and, where practicable, approve significant pleadings, motions, and other filings before they are submitted to the court, understanding that time-sensitive filings may occasionally require expedited review or may need to be filed on shortened notice;

(c) SLG will keep the Firm informed of any material developments that may affect the claims or the litigation, including any communications received from Ridgeline, Gerald Brashear, or their counsel; any changes to the facts or circumstances underlying the claims; any related regulatory, insurance, or financial developments; and any changes in SLG personnel relevant to the engagement; and

(d) SLG will implement and maintain, in coordination with the Firm, a litigation hold on all documents and electronically stored information potentially relevant to the claims, in accordance with SLG's preservation obligations under applicable law.

The following individuals have been designated as the key client contacts for this engagement:

• Diane Ostrowski, General Counsel — Ms. Ostrowski will serve as the primary client contact for all legal matters, strategy discussions, billing and administrative issues, and day-to-day communications with the engagement team. Unless otherwise directed by Ms. Ostrowski, the Firm will direct all substantive communications regarding the engagement to Ms. Ostrowski.

• Marcus Ellington, Chief Executive Officer — Mr. Ellington will be available for executive-level strategic decisions regarding the litigation, including settlement authority and major litigation milestones. Mr. Ellington may also be called upon to provide affidavits, declarations, or testimony as needed.

• Samuel Trujillo, Vice President of Operations — Mr. Trujillo will serve as the primary point of contact for operational facts, including documentation of Ridgeline's service failures, capacity shortfalls, re-procurement costs, substitute carrier arrangements, and the operational and financial impact of Ridgeline's breach on SLG's logistics network.

SLG may designate additional or substitute contacts from time to time by written notice to Ms. Anand.

8. Confidentiality

All communications between the Firm and SLG made in the course of this engagement, including but not limited to oral and written communications, memoranda, reports, correspondence, and documents exchanged for the purpose of providing or obtaining legal advice, are intended to be protected by the attorney-client privilege and/or the work product doctrine, to the fullest extent permitted by applicable law. SLG should take care to mark privileged communications as "Attorney-Client Privileged" or "Privileged and Confidential" where appropriate, and to limit distribution of such communications to individuals who have a need to know.

The Firm will maintain the confidentiality of all information provided by or on behalf of SLG in connection with this engagement, in accordance with the Firm's professional obligations under the Texas Disciplinary Rules of Professional Conduct, Rule 1.05 (Confidentiality of Information), and applicable law. The Firm will not disclose confidential client information to any third party, except: (a) as authorized by SLG in writing; (b) as required by law, court order, or subpoena; (c) as impliedly authorized to carry out the representation; or (d) as otherwise permitted under the Texas Disciplinary Rules of Professional Conduct. In the event the Firm receives a subpoena or other compulsory process directed at information protected by SLG's privileges, the Firm will promptly notify SLG and will take reasonable steps to preserve the privileged nature of such information.

9. Conflicts of Interest

Prior to undertaking this engagement, the Firm conducted a thorough conflicts-of-interest check in accordance with its internal procedures and the requirements of the Texas Disciplinary Rules of Professional Conduct. Based on that review, the Firm has identified no conflicts of interest that would prevent or limit the Firm's representation of SLG in connection with the matters described in this Letter.

SLG acknowledges and understands that Calderwood & Harkness LLP is a large, multi-office law firm with a diverse client base. The Firm may currently represent, or may in the future undertake the representation of, other clients in matters unrelated to SLG or to the claims described herein. Such other matters may, in some instances, involve parties that are adverse to SLG or its affiliates in wholly unrelated contexts. SLG hereby consents to the Firm's continued or future representation of such other clients in unrelated matters, provided that no actual conflict of interest arises with respect to this engagement or the specific subject matter of the DFSA claims. This advance consent does not extend to any matter that is substantially related to the subject matter of this engagement or that would require the Firm to advocate a position directly adverse to SLG on the same or a related matter.

The Firm confirms that it does not currently represent, and has not at any time previously represented, Ridgeline Freight Carriers LLC, Gerald Brashear, or Meridian Holloway PLLC (identified by SLG as Ridgeline's former outside counsel) in any matter.

Should a conflict of interest arise during the course of this engagement, the Firm will promptly notify SLG and will take all steps required under the Texas Disciplinary Rules of Professional Conduct to address and, if possible, resolve the conflict, including seeking informed written consent from all affected clients where appropriate and permissible.

10. Termination

Termination by SLG. SLG may terminate this engagement at any time, with or without cause, by providing written notice to the Firm directed to Priya Anand at the address set forth below. Upon receipt of such notice, the Firm will take all steps reasonably necessary to protect SLG's interests, including, where applicable, seeking leave to withdraw from any pending litigation in an orderly manner and in compliance with applicable court rules. Upon termination, SLG will be responsible for payment of all fees earned and costs and expenses incurred through the effective date of termination, including any non-cancelable commitments to third-party vendors or experts made prior to the date of termination.

Withdrawal by the Firm. The Firm may seek to withdraw from the representation for cause, including but not limited to the following circumstances: (a) non-payment of fees and costs after reasonable notice and an opportunity to cure; (b) irreconcilable differences between the Firm and SLG regarding material aspects of the litigation strategy; (c) SLG's failure to cooperate with the Firm as required by Section 7 of this Letter; (d) a determination by the Firm that continued representation would violate the Texas Disciplinary Rules of Professional Conduct or other applicable rules of professional responsibility; or (e) other good cause as recognized under applicable law and ethical rules. In the event the Firm determines that withdrawal is necessary, the Firm will provide SLG with reasonable advance written notice and will cooperate in the transition of the matter to successor counsel, including the prompt transfer of all files and work product.

Return of Files. Upon termination of the engagement for any reason, the Firm will, upon SLG's request, promptly return or make available to SLG all original documents and files belonging to SLG, subject to the Firm's right to retain copies for its own records and to the Firm's lien rights under applicable law.

11. No Guarantee of Outcome

While the Firm will provide diligent, competent, and zealous representation in connection with SLG's claims, it is important for SLG to understand that the Firm makes no guarantee, warranty, or assurance regarding the outcome of the litigation, the amount of any judgment, award, or settlement recovery, or the collectibility of any judgment or award that may be obtained. Litigation is inherently uncertain, and the ultimate result depends on many factors, including the evidence developed during discovery, the actions and strategies of opposing counsel, the rulings of the court, and the decisions of any trier of fact.

The Firm's assessment of SLG's claims, including the enforceability of the liquidated damages provisions set forth in the DFSA, the viability and scope of the personal guaranty executed by Gerald Brashear, and the probable range of recoverable damages, will be further developed and refined as the matter progresses, additional facts are gathered, and the legal and factual positions of the opposing parties become known. The Firm will provide SLG with candid and ongoing assessments of the strengths and risks of SLG's position throughout the engagement.

Nothing in this Letter or in any prior discussions between the Firm and SLG shall be construed as a representation or guarantee of any particular outcome.

12. Document Retention

The Firm will maintain all files, documents, correspondence, work product, and electronic records related to this matter in accordance with the Firm's standard document retention policies, which are designed to comply with applicable professional responsibility rules and legal requirements. During the active phase of the engagement, the Firm will maintain complete and organized files that are accessible to the engagement team and, upon reasonable request, to SLG.

Following the conclusion of the engagement — whether by completion of the matter, termination, or withdrawal — the Firm will retain its files related to this matter for a period of seven (7) years from the date the engagement is concluded, unless a longer retention period is required by applicable law or court order. Upon the expiration of the seven-year retention period, the Firm may destroy or dispose of such files in accordance with its standard procedures, without further notice to SLG.

SLG may request the return of its original documents and client files at any time during the engagement or during the post-engagement retention period. The Firm will comply with any such request within a reasonable time, subject to the Firm's right to retain copies for its records and any applicable lien rights. SLG is encouraged to request the return of its files promptly upon the conclusion of the engagement.

13. Governing Law and Dispute Resolution

This Letter, and the terms and conditions of the engagement set forth herein, shall be governed by and construed in accordance with the laws of the State of Texas, without regard to conflict of laws principles.

In the event of any dispute arising out of or relating to the Firm's engagement, the Firm's fees or billing, or the terms and conditions of this Letter, the parties agree to submit such dispute to non-binding mediation before a mutually agreed-upon mediator in Dallas, Texas, as a prerequisite to the initiation of any litigation or other adversarial proceeding. The costs of mediation shall be shared equally by the parties unless otherwise agreed. If mediation does not resolve the dispute, either party may pursue its remedies at law or in equity in a court of competent jurisdiction in Dallas County, Texas.

Nothing in this Section shall preclude the Firm from pursuing collection of unpaid fees and costs through appropriate legal proceedings, including the filing of a suit on sworn account or other collection action, after the mediation requirement has been satisfied or waived by mutual agreement.

14. Acceptance and Authorization

We are prepared to begin work on SLG's behalf immediately upon receipt of an executed copy of this Letter. We believe the claims against Ridgeline and Gerald Brashear are substantial, and an early and well-coordinated litigation effort will serve SLG's interests. Time is of particular importance given the applicable statute of limitations and the need to preserve evidence and, potentially, to identify and trace assets.

If the terms set forth in this Letter are acceptable, we respectfully request that you, Diane Ostrowski, on behalf of Stonefield Logistics Group Inc., sign and date this Letter in the space indicated below to confirm SLG's agreement to the terms of this engagement. Please return a signed copy to the Firm at the address above, or via email to Priya Anand at panand@calderwoodharkness.com.

Please do not hesitate to contact me if you have any questions regarding any of the terms set forth herein or if you wish to discuss any aspect of the engagement before signing. We are happy to address any questions or concerns you may have.

We look forward to working with you and the Stonefield team on this important matter.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Priya Anand Partner Calderwood & Harkness LLP 2200 Ross Avenue, Suite 3600 Dallas, Texas 75201 Direct Telephone: (214) 553-8817

Email: panand@calderwoodharkness.com

ACCEPTANCE AND AGREEMENT

The undersigned, Diane Ostrowski, in her capacity as General Counsel of Stonefield Logistics Group Inc., hereby confirms that she has read and understood the terms and conditions of this engagement letter and is duly authorized to accept the same on behalf of Stonefield Logistics Group Inc. By signing below, Stonefield Logistics Group Inc. agrees to the terms of the engagement as set forth herein.

ACCEPTED AND AGREED:

STONEFIELD LOGISTICS GROUP INC.

By: ________

Name: Diane Ostrowski

Title: General Counsel

Date: ________

cc: Marcus Ellington, Chief Executive Officer, Stonefield Logistics Group Inc. cc: Douglas Carmichael, Partner, Calderwood & Harkness LLP

Timekeeper	Role	Hourly Rate
Priya Anand	Partner	$895.00
Douglas Carmichael	Partner	$875.00
Jeffrey Park	Senior Associate	$545.00
Yuki Nakamura	Associate	$425.00

CONFIDENTIAL — ATTORNEY-CLIENT PRIVILEGED
CALDERWOOD & HARKNESS LLP Attorneys at Law 2200 Ross Avenue, Suite 3600 Dallas, Texas 75201 Telephone: (214) 553-8800 Facsimile: (214) 553-8801 www.calderwoodharkness.com
January 29, 2024
VIA EMAIL AND FIRST-CLASS MAIL
Diane Ostrowski, Esq. General Counsel Stonefield Logistics Group Inc. 4100 Commerce Street, Suite 1200 Dallas, Texas 75226
Re: Engagement of Calderwood & Harkness LLP — Breach of Contract Claims Against Ridgeline Freight Carriers LLC and Gerald Brashear Matter Number: 1012-00006
Dear Ms. Ostrowski:
1. Purpose and Engagement
Calderwood & Harkness LLP ("the Firm," "C&H," or "we") is pleased to confirm the terms of our engagement by Stonefield Logistics Group Inc. ("Stonefield," "SLG," or "the Company") as outside litigation counsel in the above-referenced matter. We appreciate the confidence that you and the Stonefield leadership team have placed in the Firm, and we look forward to providing the highest quality legal representation in connection with the claims described herein.
This engagement letter (this "Letter") sets forth the scope, terms, and conditions under which the Firm will represent SLG. It is intended to memorialize and supersede the understandings discussed during our initial meetings with you and with Marcus Ellington, Chief Executive Officer of SLG, on January 16 and January 22, 2024, respectively. We are grateful that you and Mr. Ellington chose to entrust this significant matter to our firm following those productive conversations, and we are committed to pursuing SLG's interests vigorously and efficiently.
Please review this Letter carefully. If the terms set forth below are acceptable, we ask that you execute and return a copy of this Letter as described in Section 14 so that we may promptly commence work on your behalf.
2. Scope of Representation
The Firm will represent SLG in connection with the pursuit of breach-of-contract claims and related contractual remedies against the following parties:
(a) Ridgeline Freight Carriers LLC ("Ridgeline"), an Oklahoma limited liability company registered to do business in the State of Texas, with its principal office located at 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159; and
(b) Gerald "Gerry" Brashear, individually, in his capacity as personal guarantor of Ridgeline's obligations under the agreement described below, residing at 2314 Quail Creek Drive, Edmond, Oklahoma 73034.
The claims arise from Ridgeline's material default under the Dedicated Freight Services Agreement dated April 15, 2022 (the "DFSA"), entered into between SLG (as "Shipper") and Ridgeline (as "Carrier"). As discussed in our initial consultations, SLG and Ridgeline negotiated the DFSA to govern the dedicated provision of Class 8 tractor-trailer freight transportation capacity across SLG's Southwest regional distribution network, including key lanes originating from SLG's Dallas and Fort Worth distribution centers.
Specifically, the Firm's representation encompasses the pursuit of liquidated damages and other contractual damages arising from the following acts and omissions by Ridgeline:
(i) Ridgeline's failure to provide the minimum dedicated trucking capacity of twelve (12) Class 8 tractor-trailers as required under Sections 3.1 and 3.2 of the DFSA, a deficiency that, based on information provided to date, began in approximately June 2023 and progressively worsened throughout the third and fourth quarters of 2023;
(ii) Ridgeline's failure to cure the foregoing defaults within the thirty (30) day cure period following SLG's written notice of material breach transmitted on October 18, 2023, in accordance with Section 12.2 of the DFSA; and
(iii) Ridgeline's complete and unilateral cessation of all operations and services under the DFSA on or about December 8, 2023, without prior notice to SLG and in direct contravention of the DFSA's termination provisions set forth in Article 12.
The scope of the Firm's representation in this matter shall include the following activities and proceedings:
•  Pre-Suit Demand and Negotiation. The Firm will prepare and transmit a formal demand letter to Ridgeline and Gerald Brashear, setting forth SLG's claims and the basis for damages, and will engage in pre-litigation settlement negotiations to the extent SLG deems appropriate and strategically advantageous.
•  Filing and Prosecution of Litigation. The Firm will prepare, file, and prosecute a civil action in the appropriate Texas state court of competent jurisdiction. Based on the DFSA's forum selection clause set forth at Section 18.2 of the DFSA, the anticipated venue for such proceedings is a district court of Dallas County, Texas. The Firm's prosecution of the litigation will encompass all phases, including pleadings, discovery (both written and depositions), motion practice, pretrial proceedings, trial, and any post-trial motions.
•  Enforcement of the Personal Guaranty. The Firm will pursue enforcement of the personal guaranty executed by Gerald Brashear pursuant to Section 14.5 of the DFSA, under which Mr. Brashear personally guaranteed Ridgeline's payment and performance obligations, subject to a stated cap of Three Million Dollars ($3,000,000.00).
•  Post-Judgment Enforcement and Collection. As may be necessary, the Firm will advise on and undertake post-judgment enforcement and collection proceedings, including but not limited to judgment domestication in Oklahoma or other jurisdictions, discovery in aid of judgment, garnishment, abstract of judgment filings, and related collection activities.
Matters Outside the Scope of This Engagement. Unless subsequently agreed in writing, the Firm's representation of SLG does not include, and the Firm assumes no responsibility for, the following:
(a) Regulatory proceedings before the Federal Motor Carrier Safety Administration ("FMCSA"), any state transportation or public utility authority, or any other governmental or regulatory body;
(b) Insurance coverage disputes, including but not limited to any claims under SLG's own commercial general liability, business interruption, or other insurance policies, or under any policies maintained by Ridgeline or its affiliates;
(c) Bankruptcy proceedings — should Ridgeline, Gerald Brashear, or any related entity file a petition for relief under the United States Bankruptcy Code (Title 11, U.S.C.), the Firm's representation in this matter would be stayed by operation of the automatic stay under 11 U.S.C. § 362, and separate engagement terms, including a potentially revised fee arrangement, would be required for representation in any bankruptcy proceeding; and
(d) Any matters, disputes, or claims unrelated to the DFSA claims described herein, including any other contractual relationships between SLG and third parties.
If during the course of this engagement we identify additional claims or issues that fall outside the scope described above but that may be relevant to SLG's interests, we will promptly advise you and discuss whether an expanded or separate engagement may be warranted.
3. Engagement Team
The following attorneys will be primarily responsible for providing legal services to SLG in connection with this matter:
Priya Anand — Responsible Partner. Ms. Anand will serve as the lead attorney and primary point of contact for SLG with respect to this engagement. Ms. Anand will oversee all aspects of the litigation strategy, coordinate with the engagement team and client contacts, manage significant court appearances and depositions, and maintain overall responsibility for the quality and direction of the Firm's work product. Ms. Anand is a partner in the Firm's Litigation & Dispute Resolution Practice Group and has extensive experience in complex commercial litigation, including breach-of-contract, supply-chain, and transportation disputes. She is admitted to practice in the State of Texas and the United States District Courts for the Northern and Eastern Districts of Texas.
Douglas Carmichael — Billing Partner. Mr. Carmichael will oversee the financial aspects of the engagement, including budgeting, invoice review, and coordination with SLG regarding billing inquiries. Mr. Carmichael will also provide strategic litigation counsel as needed and will serve as a secondary resource for executive-level client communications. Mr. Carmichael is a senior partner in the Firm's Litigation & Dispute Resolution Practice Group and has more than twenty-five years of trial and appellate experience.
Jeffrey Park — Lead Associate. Mr. Park will handle day-to-day case management, including the preparation and drafting of pleadings, motions, and discovery requests and responses. Mr. Park will also coordinate with expert consultants, manage the document review process, and assist with deposition preparation and attendance. Mr. Park is a senior associate who has been with the Firm for five years and has significant experience in commercial and contract litigation matters.
Yuki Nakamura — Working Associate. Ms. Nakamura will assist the engagement team with legal research, document review, discovery analysis, and drafting support. Ms. Nakamura joined the Firm in 2022 and has contributed to a number of complex commercial litigation matters in the Firm's Dallas office.
From time to time, other attorneys, paralegals, litigation support specialists, and administrative support staff within the Firm may be assigned to work on this matter as the needs of the engagement require. The use of additional personnel will be managed to ensure both quality and efficiency. SLG will be notified promptly if there is any material change to the composition of the engagement team, including any change to the Responsible Partner or Lead Associate. In all events, Ms. Anand will maintain supervisory responsibility for the engagement.
4. Fee Arrangement
The Firm will bill SLG for professional services rendered in connection with this matter on an hourly basis. There is no contingency fee component to this engagement. SLG's obligation to pay the Firm's fees is not contingent upon or related to the outcome of the litigation or the amount of any recovery obtained.
The current standard hourly billing rates for the members of the engagement team are as follows:
Paralegal and legal assistant time will be billed at hourly rates ranging from $195.00 to $275.00 per hour, depending on the experience level of the individual assigned and the nature of the task performed. The specific rates for paralegals and legal assistants assigned to this matter will be reflected on the Firm's monthly invoices.
The foregoing rates are the Firm's standard rates, effective as of January 1, 2024. The Firm reserves the right to adjust its standard billing rates on an annual basis, typically effective as of January 1 of each calendar year. In the event of any rate adjustment, the Firm will provide SLG with advance written notice of the revised rates at least thirty (30) days prior to the effective date of such adjustment. Adjusted rates will apply to services rendered on or after the effective date of the adjustment and will not be applied retroactively to work previously performed.
All professional time is recorded and billed in increments of one-tenth (0.1) of an hour (i.e., six-minute increments). Each invoice will contain a detailed description of the services rendered by each timekeeper, the date of service, the time expended, and the applicable billing rate.
5. Costs and Expenses
In addition to professional fees for legal services, the Firm will bill SLG for out-of-pocket costs and disbursements reasonably incurred in connection with the representation. These costs and expenses are separate from, and in addition to, the fees for professional services described in Section 4 above.
Reimbursable costs and expenses may include, without limitation, the following:
•  Court filing fees, service of process fees, and other court costs;
•  Process server fees;
•  Courier, messenger, and overnight delivery charges (e.g., Severin Partners LLC, Halcyon Partners LLC);
•  Travel expenses, including transportation (airfare, mileage, rental car, taxi/rideshare), lodging, and meals, billed at the Firm's actual cost and in accordance with the Firm's standard travel reimbursement policies;
•  Long-distance telephone charges and videoconference platform charges;
•  Computerized legal research charges (e.g., Westlaw, Sundial Solutions, PACER);
•  Photocopying, printing, scanning, and document reproduction charges;
•  Expert witness fees, consultant fees, and related expenses (e.g., forensic accounting, financial analysis, asset tracing, industry experts);
•  Court reporter attendance fees, deposition transcript costs, and videography charges;
•  Mediation or alternative dispute resolution fees and costs;
•  Electronic discovery hosting, processing, and review platform charges; and
•  Any other costs or expenses reasonably and necessarily incurred in connection with the prosecution and enforcement of SLG's claims.
For any individual cost item, third-party vendor engagement, or expert witness retention that is expected to exceed Five Thousand Dollars ($5,000.00), the Firm will seek and obtain prior written or email approval from SLG (through Ms. Ostrowski or her designee) before incurring such expense. The Firm will endeavor to provide reasonable estimates where available and to identify cost-effective alternatives. SLG's approval of costs in excess of the $5,000.00 threshold will not be unreasonably withheld.
6. Billing and Payment Terms
The Firm will issue monthly invoices to SLG for professional fees earned and costs and expenses incurred during the preceding calendar month. Invoices will be directed to Diane Ostrowski, General Counsel, at the address set forth above, or to such other address or email as SLG may designate in writing. Invoices will include a detailed narrative description of services rendered, identified by timekeeper and date, together with an itemization of costs and expenses.
All invoices are due and payable within thirty (30) days of receipt by SLG. The Firm reserves the right to charge interest on any amounts that remain unpaid beyond the thirty-day payment period at the rate of one percent (1.0%) per month (equivalent to twelve percent (12%) per annum), or the maximum rate permitted by applicable law, whichever is less. Interest will accrue from the date the payment was due until the date the payment is received by the Firm.
SLG may direct any billing inquiries, questions regarding specific charges, or requests for additional billing detail to Douglas Carmichael or to the Firm's billing department at billing@calderwoodharkness.com or by telephone at (214) 553-8842. The Firm is committed to transparency in billing and will make every reasonable effort to address any billing questions or concerns promptly.
The Firm reserves the right to require an advance retainer deposit if, at any point during the engagement, the Firm reasonably determines that such a deposit is warranted based on the anticipated scope of upcoming work, the payment history on the account, or other relevant considerations. Any retainer deposit received will be held in the Firm's client trust account and applied against final invoices or refunded to SLG at the conclusion of the engagement, as appropriate.
7. Client Responsibilities
Effective and efficient representation requires the active cooperation of the client. SLG agrees to cooperate fully with the Firm in the prosecution of the claims described in this Letter, including by providing timely access to documents, records, electronic files, contracts, correspondence, financial data, and other information relevant to the matter, as well as making available for interviews, meetings, depositions, and testimony such SLG personnel as the Firm may reasonably request.
In particular, SLG agrees to the following:
(a) SLG will respond promptly to the Firm's requests for information, documents, and factual input, recognizing that delays in providing requested materials may adversely affect the litigation timeline and strategy;
(b) SLG will review and, where practicable, approve significant pleadings, motions, and other filings before they are submitted to the court, understanding that time-sensitive filings may occasionally require expedited review or may need to be filed on shortened notice;
(c) SLG will keep the Firm informed of any material developments that may affect the claims or the litigation, including any communications received from Ridgeline, Gerald Brashear, or their counsel; any changes to the facts or circumstances underlying the claims; any related regulatory, insurance, or financial developments; and any changes in SLG personnel relevant to the engagement; and
(d) SLG will implement and maintain, in coordination with the Firm, a litigation hold on all documents and electronically stored information potentially relevant to the claims, in accordance with SLG's preservation obligations under applicable law.
The following individuals have been designated as the key client contacts for this engagement:
•  Diane Ostrowski, General Counsel — Ms. Ostrowski will serve as the primary client contact for all legal matters, strategy discussions, billing and administrative issues, and day-to-day communications with the engagement team. Unless otherwise directed by Ms. Ostrowski, the Firm will direct all substantive communications regarding the engagement to Ms. Ostrowski.
•  Marcus Ellington, Chief Executive Officer — Mr. Ellington will be available for executive-level strategic decisions regarding the litigation, including settlement authority and major litigation milestones. Mr. Ellington may also be called upon to provide affidavits, declarations, or testimony as needed.
•  Samuel Trujillo, Vice President of Operations — Mr. Trujillo will serve as the primary point of contact for operational facts, including documentation of Ridgeline's service failures, capacity shortfalls, re-procurement costs, substitute carrier arrangements, and the operational and financial impact of Ridgeline's breach on SLG's logistics network.
SLG may designate additional or substitute contacts from time to time by written notice to Ms. Anand.
8. Confidentiality
All communications between the Firm and SLG made in the course of this engagement, including but not limited to oral and written communications, memoranda, reports, correspondence, and documents exchanged for the purpose of providing or obtaining legal advice, are intended to be protected by the attorney-client privilege and/or the work product doctrine, to the fullest extent permitted by applicable law. SLG should take care to mark privileged communications as "Attorney-Client Privileged" or "Privileged and Confidential" where appropriate, and to limit distribution of such communications to individuals who have a need to know.
The Firm will maintain the confidentiality of all information provided by or on behalf of SLG in connection with this engagement, in accordance with the Firm's professional obligations under the Texas Disciplinary Rules of Professional Conduct, Rule 1.05 (Confidentiality of Information), and applicable law. The Firm will not disclose confidential client information to any third party, except: (a) as authorized by SLG in writing; (b) as required by law, court order, or subpoena; (c) as impliedly authorized to carry out the representation; or (d) as otherwise permitted under the Texas Disciplinary Rules of Professional Conduct. In the event the Firm receives a subpoena or other compulsory process directed at information protected by SLG's privileges, the Firm will promptly notify SLG and will take reasonable steps to preserve the privileged nature of such information.
9. Conflicts of Interest
Prior to undertaking this engagement, the Firm conducted a thorough conflicts-of-interest check in accordance with its internal procedures and the requirements of the Texas Disciplinary Rules of Professional Conduct. Based on that review, the Firm has identified no conflicts of interest that would prevent or limit the Firm's representation of SLG in connection with the matters described in this Letter.
SLG acknowledges and understands that Calderwood & Harkness LLP is a large, multi-office law firm with a diverse client base. The Firm may currently represent, or may in the future undertake the representation of, other clients in matters unrelated to SLG or to the claims described herein. Such other matters may, in some instances, involve parties that are adverse to SLG or its affiliates in wholly unrelated contexts. SLG hereby consents to the Firm's continued or future representation of such other clients in unrelated matters, provided that no actual conflict of interest arises with respect to this engagement or the specific subject matter of the DFSA claims. This advance consent does not extend to any matter that is substantially related to the subject matter of this engagement or that would require the Firm to advocate a position directly adverse to SLG on the same or a related matter.
The Firm confirms that it does not currently represent, and has not at any time previously represented, Ridgeline Freight Carriers LLC, Gerald Brashear, or Meridian Holloway PLLC (identified by SLG as Ridgeline's former outside counsel) in any matter.
Should a conflict of interest arise during the course of this engagement, the Firm will promptly notify SLG and will take all steps required under the Texas Disciplinary Rules of Professional Conduct to address and, if possible, resolve the conflict, including seeking informed written consent from all affected clients where appropriate and permissible.
10. Termination
Termination by SLG. SLG may terminate this engagement at any time, with or without cause, by providing written notice to the Firm directed to Priya Anand at the address set forth below. Upon receipt of such notice, the Firm will take all steps reasonably necessary to protect SLG's interests, including, where applicable, seeking leave to withdraw from any pending litigation in an orderly manner and in compliance with applicable court rules. Upon termination, SLG will be responsible for payment of all fees earned and costs and expenses incurred through the effective date of termination, including any non-cancelable commitments to third-party vendors or experts made prior to the date of termination.
Withdrawal by the Firm. The Firm may seek to withdraw from the representation for cause, including but not limited to the following circumstances: (a) non-payment of fees and costs after reasonable notice and an opportunity to cure; (b) irreconcilable differences between the Firm and SLG regarding material aspects of the litigation strategy; (c) SLG's failure to cooperate with the Firm as required by Section 7 of this Letter; (d) a determination by the Firm that continued representation would violate the Texas Disciplinary Rules of Professional Conduct or other applicable rules of professional responsibility; or (e) other good cause as recognized under applicable law and ethical rules. In the event the Firm determines that withdrawal is necessary, the Firm will provide SLG with reasonable advance written notice and will cooperate in the transition of the matter to successor counsel, including the prompt transfer of all files and work product.
Return of Files. Upon termination of the engagement for any reason, the Firm will, upon SLG's request, promptly return or make available to SLG all original documents and files belonging to SLG, subject to the Firm's right to retain copies for its own records and to the Firm's lien rights under applicable law.
11. No Guarantee of Outcome
While the Firm will provide diligent, competent, and zealous representation in connection with SLG's claims, it is important for SLG to understand that the Firm makes no guarantee, warranty, or assurance regarding the outcome of the litigation, the amount of any judgment, award, or settlement recovery, or the collectibility of any judgment or award that may be obtained. Litigation is inherently uncertain, and the ultimate result depends on many factors, including the evidence developed during discovery, the actions and strategies of opposing counsel, the rulings of the court, and the decisions of any trier of fact.
The Firm's assessment of SLG's claims, including the enforceability of the liquidated damages provisions set forth in the DFSA, the viability and scope of the personal guaranty executed by Gerald Brashear, and the probable range of recoverable damages, will be further developed and refined as the matter progresses, additional facts are gathered, and the legal and factual positions of the opposing parties become known. The Firm will provide SLG with candid and ongoing assessments of the strengths and risks of SLG's position throughout the engagement.
Nothing in this Letter or in any prior discussions between the Firm and SLG shall be construed as a representation or guarantee of any particular outcome.
12. Document Retention
The Firm will maintain all files, documents, correspondence, work product, and electronic records related to this matter in accordance with the Firm's standard document retention policies, which are designed to comply with applicable professional responsibility rules and legal requirements. During the active phase of the engagement, the Firm will maintain complete and organized files that are accessible to the engagement team and, upon reasonable request, to SLG.
Following the conclusion of the engagement — whether by completion of the matter, termination, or withdrawal — the Firm will retain its files related to this matter for a period of seven (7) years from the date the engagement is concluded, unless a longer retention period is required by applicable law or court order. Upon the expiration of the seven-year retention period, the Firm may destroy or dispose of such files in accordance with its standard procedures, without further notice to SLG.
SLG may request the return of its original documents and client files at any time during the engagement or during the post-engagement retention period. The Firm will comply with any such request within a reasonable time, subject to the Firm's right to retain copies for its records and any applicable lien rights. SLG is encouraged to request the return of its files promptly upon the conclusion of the engagement.
13. Governing Law and Dispute Resolution
This Letter, and the terms and conditions of the engagement set forth herein, shall be governed by and construed in accordance with the laws of the State of Texas, without regard to conflict of laws principles.
In the event of any dispute arising out of or relating to the Firm's engagement, the Firm's fees or billing, or the terms and conditions of this Letter, the parties agree to submit such dispute to non-binding mediation before a mutually agreed-upon mediator in Dallas, Texas, as a prerequisite to the initiation of any litigation or other adversarial proceeding. The costs of mediation shall be shared equally by the parties unless otherwise agreed. If mediation does not resolve the dispute, either party may pursue its remedies at law or in equity in a court of competent jurisdiction in Dallas County, Texas.
Nothing in this Section shall preclude the Firm from pursuing collection of unpaid fees and costs through appropriate legal proceedings, including the filing of a suit on sworn account or other collection action, after the mediation requirement has been satisfied or waived by mutual agreement.
14. Acceptance and Authorization
We are prepared to begin work on SLG's behalf immediately upon receipt of an executed copy of this Letter. We believe the claims against Ridgeline and Gerald Brashear are substantial, and an early and well-coordinated litigation effort will serve SLG's interests. Time is of particular importance given the applicable statute of limitations and the need to preserve evidence and, potentially, to identify and trace assets.
If the terms set forth in this Letter are acceptable, we respectfully request that you, Diane Ostrowski, on behalf of Stonefield Logistics Group Inc., sign and date this Letter in the space indicated below to confirm SLG's agreement to the terms of this engagement. Please return a signed copy to the Firm at the address above, or via email to Priya Anand at panand@calderwoodharkness.com.
Please do not hesitate to contact me if you have any questions regarding any of the terms set forth herein or if you wish to discuss any aspect of the engagement before signing. We are happy to address any questions or concerns you may have.
We look forward to working with you and the Stonefield team on this important matter.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Priya Anand Partner Calderwood & Harkness LLP 2200 Ross Avenue, Suite 3600 Dallas, Texas 75201 Direct Telephone: (214) 553-8817
Email: panand@calderwoodharkness.com
ACCEPTANCE AND AGREEMENT
The undersigned, Diane Ostrowski, in her capacity as General Counsel of Stonefield Logistics Group Inc., hereby confirms that she has read and understood the terms and conditions of this engagement letter and is duly authorized to accept the same on behalf of Stonefield Logistics Group Inc. By signing below, Stonefield Logistics Group Inc. agrees to the terms of the engagement as set forth herein.
ACCEPTED AND AGREED:
STONEFIELD LOGISTICS GROUP INC.
By: ________
Name: Diane Ostrowski
Title: General Counsel
Date: ________
cc: Marcus Ellington, Chief Executive Officer, Stonefield Logistics Group Inc. cc: Douglas Carmichael, Partner, Calderwood & Harkness LLP
Timekeeper | Role | Hourly Rate
Priya Anand | Partner | $895.00
Douglas Carmichael | Partner | $875.00
Jeffrey Park | Senior Associate | $545.00
Yuki Nakamura | Associate | $425.00

CONFIDENTIAL — ATTORNEY-CLIENT PRIVILEGED

VIA EMAIL AND FIRST-CLASS MAIL

CALDERWOOD & HARKNESS LLP

ACCEPTANCE AND AGREEMENT

ACCEPTED AND AGREED:

STONEFIELD LOGISTICS GROUP INC.

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