CONFIDENTIAL — ATTORNEY-CLIENT PRIVILEGED / WORK PRODUCT
MEMORANDUM — CONFLICT CHECK AND CLEARANCE
CALDERWOOD & HARKNESS LLP 599 Lexington Avenue New York, NY 10022
I. Purpose and Summary
This memorandum documents the results of the conflict-of-interest check conducted by Calderwood & Harkness LLP (the "Firm" or "C&H") in connection with the proposed engagement of the Firm to represent Calloway-Briggs Renewables Inc. ("CBR" or the "Company") in its proposed initial public offering (the "IPO" or the "Offering") of approximately $600,000,000 of common stock on the New York Stock Exchange (proposed ticker symbol: CBRI). The conflict check was undertaken in accordance with the Firm's internal policies and procedures governing new business intake, as well as the requirements of the New York Rules of Professional Conduct, including in particular Rules 1.7 (Conflict of Interest: Current Clients), 1.9 (Duties to Former Clients), and 1.10 (Imputation of Conflicts of Interest).
The conflict check was initiated on March 4, 2022 and completed on March 8, 2022, in advance of the execution of the engagement letter currently scheduled for March 10, 2022. The check was designed to identify any actual, potential, or reasonably foreseeable conflicts of interest arising from the Firm's current or prior representations that could affect, or be perceived to affect, the Firm's ability to provide independent and undivided legal representation to CBR in the proposed IPO.
The check was run against all parties expected to be involved in the transaction, including the issuer and its affiliates, subsidiaries, officers, and directors; the Company's pre-IPO stockholders and their affiliates and representatives; the proposed underwriters and their key personnel; opposing counsel and co-counsel; the Company's independent auditor; tax advisors; transfer agent; financial printer; D&O insurance broker and carriers; corporate and project-finance lenders; tax-equity investors; and all other known working-group participants. In total, the conflict check encompassed searches on over sixty entities and individuals, each of which is identified in the body of this memorandum and listed in Appendix A.
Conclusion: Based on the comprehensive analysis set forth herein, no disqualifying conflicts of interest have been identified that would prevent Calderwood & Harkness LLP from undertaking the proposed representation. Three prior or current relationships were identified that warrant disclosure, and one — the Firm's ongoing representation of Graymont Brothers Inc. in an unrelated regulatory matter — requires advance informed written consent from both CBR and Graymont Brothers Inc. pursuant to Rule 1.7 of the New York Rules of Professional Conduct. Consent from Graymont Brothers Inc. was obtained on March 7, 2022, and consent from CBR will be obtained as part of the engagement letter execution on March 10, 2022. Subject to the conditions and disclosures described in Section VII below, the engagement may proceed.
II. Proposed Client Identification
A. The Issuer
The following information was obtained from CBR's counsel, Sandra Haverford, General Counsel and Corporate Secretary of CBR, as well as from publicly available records, and was used to conduct the conflict-check searches described herein.
CBR is a renewable energy company focused on the development, construction, and operation of utility-scale solar, onshore wind, and battery energy storage projects across the southwestern United States. The Company was founded in 2014 and currently operates an approximate 3.2 GW portfolio of generating and storage assets across Texas, Oklahoma, Arizona, and New Mexico. The Company's pre-IPO capitalization reflects a majority investment by Pinnacle Vista Capital Partners III, LP, which currently holds approximately 62% of the Company's fully diluted common stock.
B. Key Officers and Directors of CBR (Individuals Searched)
Conflict-check searches were conducted on each of the following individuals, who constitute CBR's current officers and directors. Each name was searched against the Firm's conflict-check system using the individual's full legal name as well as any known variations or former names.
Officers:
1. Garrett Calloway — Co-Founder, Chairman of the Board of Directors & Chief Executive Officer
2. Elaine Briggs — Co-Founder & President, Development
3. Marcus Yoon — Chief Financial Officer
4. Sandra Haverford — General Counsel & Corporate Secretary
5. Dale Renfroe — Chief Operating Officer
6. Priya Anand — Senior Vice President, Finance & Treasurer
7. Tomás Quintero — Senior Vice President, Project Development
8. Rachel Whitmore — Chief People Officer
Directors:
9. Hugh Pemberton — Director (Pinnacle Vista Capital Management LLC designee)
10. Diane Kovac — Director (Pinnacle Vista Capital Management LLC designee)
11. Warren Okoro — Independent Director
12. Catherine Liang — Independent Director
13. Richard Estavez — Independent Director
C. Material Subsidiaries of CBR (Entities Searched)
Each of the following material subsidiaries of CBR was identified through review of CBR's organizational chart provided by Sandra Haverford's office and was searched as a separate entity in the Firm's conflict-check system, including under its full legal name and any known short-name variations.
1. CBR Holdings LLC — Delaware limited liability company
2. Calloway-Briggs Operating Company LLC — Texas limited liability company
3. Solaris West Solar LLC — Texas limited liability company
4. Red Mesa Wind Energy LLC — Oklahoma limited liability company
5. Painted Rock Solar LLC — Arizona limited liability company
6. Pronghorn Wind LLC — Texas limited liability company
7. Brazos Energy Storage LLC — Texas limited liability company
8. Mesquite Wind Holdings LLC — Texas limited liability company
9. Cimarron Solar Development LLC — New Mexico limited liability company
10. CBR Development Co. LLC — Texas limited liability company
The foregoing list represents CBR's material subsidiaries as of the date of this memorandum. To the extent additional subsidiaries or affiliates are identified during the course of the IPO engagement, supplemental conflict checks will be conducted promptly and the results documented in accordance with Firm policy.
III. Adverse and Potentially Adverse Parties Searched
A. Pre-IPO Majority Stockholder
Key Individuals Searched:
• Hugh Pemberton — Co-Founder & Managing Partner, Pinnacle Vista Capital Management LLC; Director of CBR
• Diane Kovac — Co-Founder & Managing Partner, Pinnacle Vista Capital Management LLC; Director of CBR
Relationship to Transaction: Pinnacle Vista Capital Partners III, LP is the pre-IPO majority stockholder of CBR, holding approximately 62% of the Company's fully diluted common stock. In connection with the proposed IPO, Pinnacle Vista is expected to be a selling stockholder with respect to a secondary offering component of approximately $150,000,000 of common stock. Additionally, Pinnacle Vista will be a party to the underwriting agreement to be entered into among the Company, the selling stockholders, and the underwriters. Following the IPO, Pinnacle Vista is expected to continue to hold a significant (though reduced) stake in CBR and will be a party to an Amended and Restated Stockholders' Agreement and a Registration Rights Agreement governing the registration of its remaining shares.
Pinnacle Vista's Separate Counsel for IPO: Pinnacle Vista is separately represented by Whitfield Archer & Doss LLP ("WA&D") in connection with all matters relating to the IPO and the related ancillary agreements. Calderwood & Harkness does not represent and has not been engaged to represent Pinnacle Vista or any Pinnacle Vista affiliate in any capacity. The interests of CBR and Pinnacle Vista, while substantially aligned for purposes of the IPO, may diverge on certain matters, including the allocation of offering proceeds between primary and secondary shares, the scope of indemnification obligations under the underwriting agreement, lock-up provisions, and the terms of post-IPO governance arrangements. The Firm's representation will be limited to CBR, and WA&D will independently advise Pinnacle Vista on these and all other matters.
B. Proposed Underwriters (Counterparties to Underwriting Agreement)
The following broker-dealer firms have been identified as the proposed underwriters for the IPO and will be counterparties to CBR under the underwriting agreement. Each underwriter, together with its key personnel identified to date, was searched in the Firm's conflict-check system. The underwriters are being separately represented by Prescott, Danforth & Yee LLP as underwriters' counsel.
1. Lead-Left Book-Runner.
Key Individuals Searched:
• Oliver Marchetti — Managing Director, Equity Capital Markets
• Sonia Tran — Director, Power & Renewables Investment Banking
• Daniel Furman — Vice President, ECM Syndicate
2. Joint Book-Runner.
Key Individuals Searched:
• Rebecca Innes — Managing Director, ECM
• James Alcorn — Director, Clean Energy & Infrastructure
3. Joint Book-Runner.
Key Individuals Searched:
• Kenneth Sato — Managing Director, ECM
• Lisa Trujillo — Director, Utilities & Renewables
4. Co-Manager.
5. Co-Manager.
IV. Other Working-Group Members and Third Parties Searched
In addition to the issuer, its affiliates, stockholders, and underwriters, the following working-group members and third parties were identified and searched in the Firm's conflict-check system. Although many of these parties are not expected to have directly adverse interests to CBR in the IPO, the Firm's conflict-check policy requires comprehensive searches across all known transaction participants to identify any relationships that may warrant disclosure, recusal, or further analysis.
A. Opposing / Co-Counsel
Prescott, Danforth & Yee LLP (Underwriters' Counsel) 1271 Avenue of the Americas, New York, NY 10020
• Margaret Yee — Partner, Capital Markets (lead partner for underwriters' counsel)
• Scott Halverson — Counsel, Capital Markets
• Anita Desmond — Associate
Whitfield Archer & Doss LLP (Pinnacle Vista's Counsel) 51 West 52nd Street, New York, NY 10019
• Philip Archer — Partner, PE/M&A
• Christine Navarro — Partner, Capital Markets
• Derek Fong — Senior Associate
B. Independent Auditor
Ashford & Pemberton LLP 30 Rockefeller Plaza, Suite 2800, New York, NY 10112
• Gregory Sondheim — Lead Engagement Partner, CPA
• Irene Valdez — Audit Manager, CPA
Ashford & Pemberton serves as CBR's independent registered public accounting firm and will issue audit opinions on CBR's financial statements included in the registration statement. The auditors will also deliver comfort letters to the underwriters in connection with the IPO.
C. Tax Advisor
Kessler McBride & Associates LLP 700 Milam Street, Suite 2100, Houston, TX 77002
• Alan Kessler — Managing Partner
• Linda McBride — Partner, Tax Structures
Kessler McBride has been engaged by CBR to advise on certain structural tax matters related to the IPO, including the tax treatment of certain pre-IPO reorganization transactions and the conversion of certain partnership interests.
D. Transfer Agent / Registrar
Continental Shareowner Services, Inc. 1 Ashbury Asset Advisors Plaza, 30th Floor, New York, NY 10004
• Maria Costello — Vice President, Corporate Actions
Continental Shareowner Services has been engaged to serve as the transfer agent and registrar for the Company's common stock following the IPO.
E. Financial Printer
Ridgeway Financial Printing Corp. 79 Madison Avenue, New York, NY 10016
• Alan Greenidge — Account Director
Ridgeway Financial Printing will be responsible for the typesetting, printing, and EDGAR filing of the registration statement on Form S-1 and related prospectus materials.
F. D&O Insurance Broker and Carriers
Dravello Place Insurance Advisors LLC (D&O Insurance Broker) 250 Greenwich Street, Suite 3700, New York, NY 10007
• Nina Radcliffe — Vice President
D&O Insurance Carriers:
• Meridian National Assurance Company — Primary D&O carrier (Policy No. DNO-22-048871)
• Stonebridge Indemnity Corp. — Excess Layer 1
• Commonwealth Omnivrel Insurance Ltd. — Excess Layer 2
CBR is in the process of binding a public-company D&O insurance tower in connection with the IPO, with the policies expected to become effective immediately prior to the effectiveness of the registration statement.
G. Corporate and Project-Finance Lenders
Veltrano National Bank 1401 McKinney Street, Houston, TX 77010
• Thomas Raines — Managing Director, Energy Lending
Role: Administrative Agent for CBR's $400,000,000 Corporate Revolving Credit Facility and $650,000,000 Corporate Term Loan B. In connection with the IPO, CBR intends to apply approximately $200,000,000 of net IPO proceeds to prepay a portion of the Term Loan B, and will seek a lender consent from Veltrano in its capacity as Administrative Agent with respect to certain covenants and provisions of the credit agreement that may be affected by the IPO and related transactions.
Prairie Commercial Bank, N.A. 2200 Ross Avenue, Suite 3600, Dallas, TX 75201
• Brent Hollowell — SVP, Project Finance
Role: Lender under the Mesquite Wind Holdings LLC construction-to-term facility ($165,000,000) and the Cimarron Solar Development LLC construction-to-term facility ($143,000,000). These project-level credit facilities are non-recourse to CBR and are secured by the respective project assets.
H. Tax-Equity Investor
Veltara Basin Financial LLC 2029 Century Park East, Suite 1500, Los Angeles, CA 90067
• Karen Fujimoto — Partner, Tax Equity Investments
Role: Tax-equity investor in the Solaris West Solar LLC partnership flip structure, with a total capital commitment of $280,000,000. The Solaris West tax-equity structure is expected to be disclosed in the registration statement as a material contractual arrangement.
I. Other Advisors
Clarendon Rowe Advisory Group LLC (Compensation Consultant) 300 Atlantic Street, Suite 800, Stamford, CT 06901
• Patricia Voss — Senior Managing Director
Clarendon Rowe has been engaged by CBR's compensation committee to advise on executive compensation arrangements and equity incentive plan design in connection with the IPO.
Broadmark Strategic Communications Inc. (Investor Relations Advisor) 640 Fifth Avenue, Suite 1205, New York, NY 10019
• Jason Eklund — Managing Director
Broadmark has been engaged to advise CBR on investor relations strategy, messaging, and communications in connection with the IPO roadshow and post-IPO public company communications.
Greenridge Environmental Sciences LLC (Environmental Consultant) 8400 Shoal Creek Blvd., Suite 200, Austin, TX 78757
• Dr. Nadine Torres — Principal Scientist
Greenridge has been engaged by CBR to conduct certain environmental due diligence and provide environmental assessments in connection with the disclosure of environmental matters in the registration statement.
V. Conflict-Check Methodology
The conflict-of-interest check documented in this memorandum was conducted in accordance with the Firm's Conflicts of Interest Policy (as most recently updated January 2022) and the Firm's New Business Intake Procedures Manual. The following describes the methodology employed.
Databases and Systems Searched. The primary search tool was the Firm's proprietary conflict-check and new-business-intake system ("C&H IntakeCheck"), which indexes all current and historical client and matter records, engagement letters, billing records, and party identifications for all matters opened since the system's implementation in 2003. In addition, supplemental searches were conducted in the following systems and databases:
(a) The Firm's master client database, which contains records of all client engagements, including engagement letters, fee agreements, and closing memoranda.
(b) The Firm's matter management system, which tracks all active, recently closed (within the prior five years), and historically significant matters (matters involving fees in excess of $500,000 or matters designated as "significant" by practice-group leaders).
(c) The Firm's lateral-hire conflict records, which document conflict-check results and prior representations disclosed by lateral attorneys at the time of their hiring by the Firm. These records were consulted to identify any relationships arising from attorneys' prior firm affiliations.
(d) The Firm's financial and billing system, which was used to confirm the status (active, closed, or dormant) of matters identified in the initial search results.
Search Parameters. Searches were run on all entity names, short names, aliases, and known "also known as" variations for each entity listed in Sections II through IV of this memorandum. For entities with common names or abbreviations, additional searches were conducted using combinations of principal words and known industry descriptors to minimize false negatives. Searches were also run on all individual names (officers, directors, and key contacts) of each entity listed in Sections II through IV, using full legal names and, where known, common variations or former names. A complete list of all search terms employed is set forth in Appendix A.
Cross-Checks by Practice Group. In addition to the automated database searches, additional cross-checks were performed by contacting practice-group leaders and senior partners in the Firm's Capital Markets, M&A, Finance/Lending, Tax, Litigation, and Environmental practice groups. Each practice-group leader was asked to confirm whether their group had any active, recently closed, or historically significant matters involving any of the parties identified in Sections II through IV, or any matters involving the renewable-energy sector that might give rise to issues warranting further review. These cross-checks were completed between March 5 and March 7, 2022, and the results are reflected in the findings set forth in Section VI.
Timing and Responsibility. All automated and manual searches were conducted by Brendan Walsh, Associate, Capital Markets, between March 4 and March 7, 2022. The search results were compiled, organized, and analyzed on March 7–8, 2022. The results, analysis, and conclusions set forth in this memorandum were reviewed and approved by Jennifer Kwon, Partner, Capital Markets, on March 8, 2022.
Limitations. The conflict check is based on the information available to the Firm as of the date hereof, including the party identifications provided by CBR's counsel and the transaction information provided by the Company and the proposed underwriters. To the extent that additional parties are identified during the course of the IPO engagement, or that the composition of the underwriting syndicate or working group changes, supplemental conflict checks will be conducted promptly and documented in supplemental memoranda.
VI. Results of Conflict Check
A. No Current Adverse Representations
Based on the searches and cross-checks described in Section V, the Firm does not currently represent any party adverse to CBR, or to CBR's interests, in connection with the proposed IPO or in any other matter. Specifically:
(a) The Firm does not currently represent any of the proposed underwriters — namely, Hargrove Keating & Co., Linden Pratt Securities LLC, Graymont Brothers Inc. (except as described in Section VI.B.3 below with respect to an unrelated regulatory compliance matter), Barfield Stuart & Co., or Crane Whitley Capital LLC — in any matter adverse to CBR or in any matter related to the proposed IPO.
(b) The Firm does not currently represent Pinnacle Vista Capital Partners III, LP, Pinnacle Vista Capital Management LLC, or any Pinnacle Vista affiliate in any matter whatsoever. The Firm has no current attorney-client relationship with Pinnacle Vista or any of its affiliates, partners, or employees.
(c) The Firm does not currently represent any of the other working-group members or third parties identified in Section IV in any matter adverse to CBR or in any matter related to the proposed IPO.
(d) The Firm has no current adverse or potentially adverse representation involving any of the individual officers, directors, or key contacts identified in Sections II through IV.
B. Prior and Existing Representations — Matters Identified Requiring Review
The conflict-check searches identified three matters that required further review and analysis. Each is described below, together with the Firm's assessment of whether the matter gives rise to an actual or potential conflict of interest requiring consent, waiver, or other remedial measures.
1. Prior Representation of Hargrove Keating & Co. Matter Identified: The Firm previously represented Hargrove Keating & Co. in connection with an M&A advisory engagement (C&H Matter No. 1015-00001). The matter involved Hargrove Keating's role as financial advisor in a 2019 acquisition transaction in the healthcare industry. The Firm served as outside legal counsel to Hargrove Keating in connection with the negotiation and execution of Hargrove Keating's engagement letter with its healthcare client and certain regulatory filings associated with the transaction. The matter was concluded in September 2019 and is fully closed in the Firm's system. No open files, outstanding invoices, or continuing obligations exist with respect to the matter.
Relevance to Proposed IPO: In the proposed CBR IPO, Hargrove Keating & Co. is the lead-left book-running manager and will be a counterparty to the underwriting agreement to be entered into among CBR, the selling stockholders, and the underwriters. As issuer's counsel, the Firm will negotiate the terms of the underwriting agreement on behalf of CBR, including provisions relating to pricing, underwriting discounts and commissions, representations and warranties, indemnification, and contribution — matters on which the interests of the issuer and the underwriters customarily diverge. Accordingly, Hargrove Keating is properly characterized as a counterparty to the Firm's proposed client (CBR) in the IPO transaction.
Assessment: No disqualifying conflict exists. The prior representation of Hargrove Keating is fully concluded and closed, and it involved a matter in a different industry (healthcare) that is entirely unrelated to CBR, the renewable-energy sector, or any aspect of the proposed IPO. No confidential information obtained by the Firm during the prior Hargrove Keating representation is relevant to the CBR IPO engagement. Under Rule 1.9 of the New York Rules of Professional Conduct, a lawyer who has formerly represented a client in a matter may not thereafter represent another person in the same or a substantially related matter in which that person's interests are materially adverse to the interests of the former client, except where the former client gives informed consent confirmed in writing. Here, the matters are not the same or substantially related, and accordingly, no consent from Hargrove Keating is required under Rule 1.9. Nonetheless, as a matter of transparency and best practice, the Firm's prior representation of Hargrove Keating will be disclosed to CBR in the engagement letter.
2. Prior Representation of Veltrano National Bank. Matter Identified: The Firm represented Veltrano National Bank as lender's counsel in a project-finance matter (C&H Matter No. 1015-00001) in 2020. The matter involved the negotiation and documentation of a project-finance credit facility for a natural gas pipeline project in which Veltrano served as administrative agent and lead arranger. The Firm acted on behalf of Veltrano and the lender syndicate in that transaction. The matter was concluded in December 2020 and is fully closed in the Firm's system, with no outstanding obligations or open files.
Relevance to Proposed IPO: In the proposed CBR IPO, Veltrano National Bank serves as the Administrative Agent under CBR's existing $400,000,000 Corporate Revolving Credit Facility and $650,000,000 Corporate Term Loan B. In connection with the IPO, CBR intends to apply approximately $200,000,000 of net IPO proceeds to prepay a portion of the Term Loan B outstanding balance. The Firm, as CBR's counsel, will be involved in reviewing the credit agreement to confirm compliance with prepayment provisions, coordinating with Veltrano as Administrative Agent to obtain any required lender consents, and ensuring that the use of proceeds and credit facility arrangements are accurately disclosed in the registration statement.
Assessment: No disqualifying conflict exists. The prior representation of Veltrano is fully concluded and closed, and it involved a different transaction (natural gas pipeline project finance) that is entirely unrelated to CBR or the proposed IPO. The current engagement does not involve the Firm acting adversely to Veltrano; rather, the lender consent process is expected to be collaborative, with CBR and Veltrano working cooperatively to document the consent and prepayment arrangements. The Firm will not be litigating against Veltrano or taking any adverse position against Veltrano's interests. No confidential information obtained during the prior Veltrano representation is relevant to the CBR IPO engagement. No formal waiver or consent from Veltrano is required under Rule 1.9. However, as a matter of transparency, the Firm's prior representation of Veltrano will be disclosed to CBR in the engagement letter.
3. Ongoing Representation of Graymont Brothers Inc. Matter Identified: The Firm is currently advising Graymont Brothers Inc. on an unrelated regulatory compliance matter (C&H Matter No. 1015-00001). The engagement involves advising Graymont on certain SEC periodic reporting and compliance matters, including the preparation and review of Graymont's annual report on Form 10-K and quarterly reports on Form 10-Q, as well as certain FINRA regulatory filings. This engagement is ongoing and the matter is currently active in the Firm's system. The Graymont regulatory-compliance team is staffed by attorneys in the Firm's Securities Regulation and Compliance practice group and does not include any members of the Capital Markets practice group that would staff the proposed CBR IPO engagement.
Relevance to Proposed IPO: In the proposed CBR IPO, Graymont Brothers Inc. is a joint book-running manager and will be a counterparty to the underwriting agreement with CBR. As described above with respect to Hargrove Keating, the interests of the issuer and the underwriters under an underwriting agreement customarily diverge on matters such as pricing, underwriting discounts and commissions, representations and warranties, indemnification, and contribution. Accordingly, Graymont is properly characterized as a counterparty to CBR in the IPO transaction.
Assessment: Because Graymont Brothers Inc. is simultaneously (i) a current client of the Firm in the ongoing SEC reporting and compliance matter and (ii) a counterparty to the Firm's proposed client (CBR) in the proposed IPO, this situation constitutes a potential concurrent-client conflict under Rule 1.7(a) of the New York Rules of Professional Conduct. Rule 1.7(a) provides that a lawyer shall not represent a client if a reasonable lawyer would conclude that the representation involves a concurrent conflict of interest — including a situation in which the representation of one client will be directly adverse to another client. Even though the two matters are wholly unrelated in subject matter and involve separate teams, the Firm cannot undertake the CBR IPO representation without addressing the concurrent-client issue because the Firm would be negotiating an underwriting agreement on behalf of CBR that is directly adverse to Graymont's interests as an underwriter.
Under Rule 1.7(b), notwithstanding the existence of a concurrent conflict, a lawyer may represent both clients if: (1) the lawyer reasonably believes that the lawyer will be able to provide competent and diligent representation to each affected client; (2) the representation is not prohibited by law; (3) the representation does not involve the assertion of a claim by one client against the other client represented by the same lawyer in the same litigation or other proceeding before a tribunal; and (4) each affected client gives informed consent, confirmed in writing. All four conditions are satisfied here:
(1) The Firm reasonably believes it can provide competent and diligent representation to both CBR (in the IPO) and Graymont (in the SEC reporting matter). The two engagements involve entirely different subject matters, different teams, and different practice groups. There is no overlap in personnel, factual issues, or legal theories.
(2) The concurrent representation is not prohibited by law.
(3) The representation does not involve the assertion of a claim by CBR against Graymont, or vice versa, in the same litigation or proceeding before a tribunal. The IPO is a capital markets transaction, not a litigation or adjudicatory proceeding.
(4) Informed consent, confirmed in writing, will be obtained from both affected clients.
Resolution: Advance informed written consent has been and will be obtained from both CBR and Graymont Brothers Inc. prior to commencement of the CBR IPO engagement. Draft consent letters were prepared by the undersigned and reviewed by Jennifer Kwon. The consent letters describe the nature of both representations, confirm that the Firm will not use confidential information from either engagement to the advantage or disadvantage of the other client, and explain the measures the Firm will take to maintain the independence and integrity of each representation.
Consent from Graymont Brothers Inc. was obtained on March 7, 2022, in the form of a letter executed by Kenneth Sato, Managing Director, ECM, on behalf of Graymont Brothers Inc. A copy of the executed consent letter is attached as Appendix B.
Consent from CBR will be obtained as part of the engagement letter for execution on March 10, 2022. The engagement letter will include a specific disclosure of the Firm's ongoing representation of Graymont and a request for CBR's informed consent to the concurrent representation. Sandra Haverford, General Counsel and Corporate Secretary of CBR, will countersign the engagement letter on behalf of CBR. The draft consent language to be included in the engagement letter is attached as Appendix C.
In addition, as a precautionary measure, an information barrier (ethical screen) will be established between the CBR IPO team and the Graymont regulatory-compliance team, as further described in Section VII.C below.
4. Searches on Other Parties — No Hits. Conflict-check searches on all remaining parties identified in Sections II through IV of this memorandum returned no current or prior representations by the Firm and no other relationships requiring disclosure, consent, or further analysis. Specifically, the searches confirmed that the Firm has no current or prior attorney-client relationship with, and has not previously represented, any of the following entities or individuals:
• Pinnacle Vista Capital Partners III, LP
• Pinnacle Vista Capital Management LLC (or any affiliate of Pinnacle Vista)
• Linden Pratt Securities LLC
• Barfield Stuart & Co.
• Crane Whitley Capital LLC
• Prescott, Danforth & Yee LLP
• Whitfield Archer & Doss LLP
• Ashford & Pemberton LLP
• Kessler McBride & Associates LLP
• Continental Shareowner Services, Inc.
• Ridgeway Financial Printing Corp.
• Dravello Place Insurance Advisors LLC
• Meridian National Assurance Company
• Stonebridge Indemnity Corp.
• Commonwealth Omnivrel Insurance Ltd.
• Veltara Basin Financial LLC
• Prairie Commercial Bank, N.A.
• Clarendon Rowe Advisory Group LLC
• Broadmark Strategic Communications Inc.
• Greenridge Environmental Sciences LLC
• Capitol Statutory Services, Inc.
In addition, individual-name searches on all officers, directors, and key contacts listed in Sections II through IV — including the thirteen CBR officers and directors, the key personnel of each underwriter, the key contacts at each working-group member and third-party advisor, and the individual attorneys at opposing and co-counsel firms — returned no current or prior representations or other relationships requiring disclosure. A complete list of all individual names searched is set forth in Appendix A.
VII. Conditions and Disclosures for Engagement Clearance
Based on the results of the conflict check set forth in Section VI, the proposed engagement of Calderwood & Harkness LLP to represent Calloway-Briggs Renewables Inc. in the proposed IPO is cleared to proceed, subject to the following conditions and disclosures.
A. Consent Required — Graymont Brothers Inc.
As discussed in Section VI.B.3, advance informed written consent from both CBR and Graymont Brothers Inc. is required in order to proceed with the concurrent representation of CBR in the IPO while continuing to represent Graymont Brothers Inc. in the unrelated SEC reporting and compliance matter.
(a) Graymont Brothers Inc. Consent: Consent was obtained from Graymont Brothers Inc. on March 7, 2022, in the form of a written consent letter executed by Kenneth Sato, Managing Director, ECM, on behalf of Graymont Brothers Inc. The executed consent letter is attached as Appendix B to this memorandum and should be retained in the Firm's files under both Matter No. 1015-00001 (CBR IPO) and Matter No. 1015-00001 (Graymont regulatory compliance).
(b) CBR Consent: Consent from CBR is to be obtained through the execution of the engagement letter for the CBR IPO, which is scheduled for execution on March 10, 2022. The engagement letter will include a specific disclosure of the Firm's ongoing Graymont representation and a request for CBR's informed consent to the concurrent representation. Sandra Haverford, General Counsel and Corporate Secretary of CBR, has been designated by CBR to receive and countersign the engagement letter. The draft consent language to be included in the engagement letter is attached as Appendix C.
The engagement may not proceed, and no substantive work on the CBR IPO may be commenced, until CBR's consent has been obtained. If CBR declines to provide consent, the matter will be escalated to the Firm's General Counsel and Conflicts Committee for further review and determination.
B. Disclosures in Engagement Letter
The engagement letter to CBR (to be dated March 10, 2022) will include disclosure of the following matters:
1. Hargrove Keating & Co. — Prior Representation. The engagement letter will disclose that the Firm previously represented Hargrove Keating & Co. in an unrelated M&A advisory matter (C&H Matter No. 1015-00001) that was concluded and closed in 2019. The disclosure will note that the prior matter is unrelated to CBR, the renewable-energy industry, or any aspect of the proposed IPO, and that no consent from Hargrove Keating is required.
2. Veltrano National Bank — Prior Representation. The engagement letter will disclose that the Firm previously represented Veltrano National Bank as lender's counsel in an unrelated project-finance matter (C&H Matter No. 1015-00001) that was concluded and closed in 2020. The disclosure will note that the prior matter is unrelated to CBR or the proposed IPO, and that the Firm's work on the IPO is not expected to involve any adversarial action against Veltrano.
3. Graymont Brothers Inc. — Ongoing Representation and Consent. The engagement letter will disclose that the Firm currently represents Graymont Brothers Inc. in an unrelated SEC reporting and compliance matter (C&H Matter No. 1015-00001), and will describe the concurrent-client conflict analysis, the measures the Firm will take to maintain the independence of each representation (including the ethical screen described in Section VII.C), and the consent framework under Rule 1.7. The engagement letter will request CBR's informed consent, confirmed in writing by countersignature.
The engagement letter will be signed by Jennifer Kwon (responsible partner) and Theodore Langston (billing partner) on behalf of Calderwood & Harkness LLP. Sandra Haverford, General Counsel and Corporate Secretary of CBR, has been identified as the authorized signatory to receive and countersign the engagement letter on behalf of CBR.
C. Ethical Screen — Graymont Brothers Inc.
As a precautionary measure, and notwithstanding that a formal ethical screen is not strictly required under the New York Rules of Professional Conduct where informed consent has been obtained, an information barrier will be established between the CBR IPO team and the Graymont Brothers Inc. regulatory-compliance team. The purpose of the information barrier is to ensure that no substantive or confidential information from either engagement is shared between the two teams, and to further protect the integrity of the Firm's independent representation of each client.