CONFIDENTIAL / ATTORNEY-CLIENT PRIVILEGED / ATTORNEY WORK PRODUCT
CALDERWOOD & HARKNESS LLP 787 Seventh Avenue New York, New York 10019
INTERNAL MEMORANDUM
July 5, 2024
TO: Engagement Team — Matter No. 1017-00002
Nathaniel Bower, Partner Colette Whitman, Partner Audrey Zhou, Associate Brendan Walsh, Associate
FROM: Nathaniel Bower, Responsible Partner
RE: Document Retention and Privilege Protocol — Post-Termination File Management, Aurelius Global Media Group PLC (Matter No. 1017-00002)
DISTRIBUTION: Internal Calderwood & Harkness LLP use only — not to be shared with client or third parties under any circumstances.
This memorandum constitutes attorney work product prepared in anticipation of potential litigation and in connection with the provision of legal services. It is protected by the attorney-client privilege, the attorney work product doctrine, and any other applicable privilege or protection. This document is prepared solely for internal use by Calderwood & Harkness LLP and shall not be disclosed to any person outside the firm — including the client, successor counsel, or any third party — without the prior written authorization of the Responsible Partner.
Right-click to update Table of Contents
I. PURPOSE AND BACKGROUND
A. Purpose of This Protocol
The purpose of this memorandum is to set forth binding internal protocols for the Calderwood & Harkness LLP engagement team assigned to Matter No. 1017-00002 with respect to: (i) preserving privileged materials generated during the firm's representation of the Board of Directors of Aurelius Global Media Group PLC ("AGMG" or the "Client"); (ii) organizing the complete engagement file, encompassing both client-file materials and firm-file materials; (iii) managing the firm's document retention obligations in compliance with Calderwood & Harkness LLP's standard retention policies and applicable professional conduct rules; and (iv) ensuring full compliance with the firm's internal policies and the New York Rules of Professional Conduct following the termination of the engagement.
This protocol is issued in connection with, and is necessitated by, the termination of Calderwood & Harkness LLP's engagement as independent board governance counsel to the Board of Directors of AGMG, effective July 8, 2024. As described more fully in Section I.C below, the circumstances surrounding the termination of the engagement — including the reconstitution of the AGMG Board following a contested proxy solicitation and the subsequent engagement of successor governance counsel with direct, prior ties to the opposing activist shareholder — create a heightened risk of inadvertent privilege waiver or unauthorized disclosure. This protocol is designed to address those risks comprehensively.
Specifically, this protocol is intended to:
1. Ensure that the attorney-client privilege and the attorney work product doctrine attaching to all materials generated or received during the engagement are preserved in full, and that no inadvertent waiver occurs during the transition period to successor counsel or at any time thereafter.
2. Establish clear chain-of-custody requirements and access controls for all physical and electronic matter files, ensuring that only authorized personnel may access engagement materials.
3. Define the responsibilities of each member of the engagement team with respect to file organization, retention, monitoring, and compliance during the post-termination period.
4. Provide a framework for responding to any future requests for engagement materials — whether from the reconstituted Board, successor counsel, the Client's General Counsel, regulatory authorities, or parties to potential litigation — in a manner that protects the privilege and the firm's interests.
5. Document the open matters and continuing obligations arising from the engagement that may require the firm's future attention or involvement.
All members of the engagement team are required to comply with this protocol in full. Non-compliance will be treated as a serious disciplinary matter, as set forth in Section VIII below.
B. Engagement Summary
Calderwood & Harkness LLP was engaged as independent board governance counsel to the Board of Directors of Aurelius Global Media Group PLC, effective March 12, 2024. The key details of the engagement are as follows:
Client Information. Aurelius Global Media Group PLC is a Delaware-incorporated, England & Wales overseas-registered public limited company, with its principal executive offices located at 14 Sceptre Row, London EC2V 7QN, United Kingdom. AGMG's ordinary shares are dual-listed on the New York Stock Exchange (NYSE ticker: AGMG) and the London Stock Exchange (LSE ticker: AGMG.L). As of March 1, 2024, AGMG had an approximate market capitalization of £6.82 billion (approximately $8.65 billion at then-prevailing exchange rates). For the fiscal year ended December 31, 2023, AGMG reported total revenue of approximately $4.37 billion, adjusted EBITDA of approximately $812 million (representing an EBITDA margin of approximately 18.6%), and maintained a global workforce of approximately 23,400 employees.
Matter Identification. The engagement was assigned Matter Number 1017-00002 in the firm's matter management system.
Engagement Timeline. The engagement was formally opened on March 12, 2024, pursuant to an engagement letter of the same date addressed to Dame Elspeth Greenvale, Independent Non-Executive Chair of the AGMG Board. A notice of termination of the engagement was received on June 21, 2024, from Vanessa Loring, in her capacity as Chair of the reconstituted Nominating & Governance Committee of the Board. The effective termination date of the engagement is July 8, 2024. Final work product and a comprehensive transition memorandum were delivered to the Client on July 1, 2024. The final invoice for services rendered is to be submitted on July 8, 2024.
Scope of Engagement. Calderwood & Harkness was retained to serve as independent board governance counsel in connection with two interrelated matters of significant corporate importance: (i) the contested CEO succession process initiated by the AGMG Board following the departure of former CEO Marcus Vane, and (ii) the Board's response to the activist campaign conducted by Corvus Peak Capital Partners LP, a Delaware limited partnership with its principal office at 590 Lexington Avenue, 34th Floor, New York, New York 10022, which held an 8.7% equity stake in AGMG at the time of its activist campaign. Pursuant to an amended engagement letter dated April 22, 2024, the scope of the engagement was expanded to include coordination with Stonebridge Crane & Co., the financial advisor retained by the Board, on the Board's review of strategic alternatives.
Engagement Team and Billing Rates. The engagement team consisted of the following personnel:
Billing Summary. The total fees and expenses billed during the engagement are as follows:
As of the effective termination date, the outstanding balance owed by the Client to Calderwood & Harkness is $312,817.00.
Retainer. An initial evergreen retainer of $75,000 was paid by the Client on March 14, 2024, and was replenished on June 14, 2024, in accordance with the quarterly replenishment schedule set forth in the engagement letter.
C. Reason for Termination
The termination of the engagement is a direct consequence of the change in the composition of the AGMG Board of Directors resulting from the June 7, 2024 Annual General Meeting of shareholders. The circumstances are as follows:
At the AGM, three director nominees put forward by Corvus Peak Capital Partners LP — Malcolm Trask, Vanessa Loring, and Dr. Raymond Chu — were elected to the Board, replacing three incumbent directors: Tobias Kessler, Hugh Pemberton, and Sofia Delgado-Ríos. The detailed vote tallies, as analyzed in Calderwood & Harkness's June 8, 2024 post-AGM vote analysis, were as follows: Malcolm Trask received votes representing 68.8% of shares cast; Vanessa Loring received 65.0%; Dr. Raymond Chu received 66.8%. The incumbent directors fared significantly worse: Tobias Kessler received 44.5%; Hugh Pemberton received 39.3%; Sofia Delgado-Ríos received 42.0%. Total shares voted were 351,280,400 out of 412,600,000 shares outstanding, representing an overall turnout of approximately 85.1%.
Following the reconstitution of the Board, a series of decisions were made in rapid succession that effectively terminated the matters on which Calderwood & Harkness had been advising:
• On June 14, 2024, the reconstituted Board voted to table the CEO succession process indefinitely and to dissolve the Special Committee that had been overseeing the succession and strategic alternatives review.
• On June 17, 2024, Vanessa Loring, newly appointed as Chair of the Nominating & Governance Committee, announced that the Board would engage new governance counsel, signaling the termination of Calderwood & Harkness's mandate.
• On June 21, 2024, Calderwood & Harkness received formal written notice of termination of the engagement from Vanessa Loring.
• On June 25, 2024, Nathaniel Bower sent an engagement termination acknowledgment letter to Vanessa Loring, confirming receipt of the termination notice and outlining the firm's transition obligations.
• On July 15, 2024 (per subsequent public filings), the reconstituted Board engaged Blackthorn Howell & Crane LLP as the Board's new governance counsel. The significance of this selection is discussed in Section I.D below.
D. Heightened Sensitivity
The engagement team must be aware of, and exercise extreme care with respect to, the elevated sensitivity of privilege preservation in this matter. The heightened risk arises from a specific and unusual circumstance: the successor counsel selected by the reconstituted Board — Blackthorn Howell & Crane LLP, led by partner Dominic Sayer — previously represented the opposing party, Corvus Peak Capital Partners LP, in the very same activist campaign that was the subject of Calderwood & Harkness's engagement.
This creates a set of risks that are both practical and legal in nature. From a practical standpoint, Blackthorn Howell & Crane, through its prior representation of Corvus Peak, possesses significant knowledge of the activist campaign, including Corvus Peak's litigation strategy, settlement positions, and tactical assessments. If privileged Calderwood & Harkness work product — particularly the firm's internal analysis of Corvus Peak's positions, strengths, and vulnerabilities — were to be disclosed to Blackthorn Howell, the resulting prejudice to the interests formerly served by that work product could be substantial. Although Blackthorn Howell now serves as counsel to the AGMG Board (and therefore the privilege holder), the fact that the same attorneys who previously advocated on behalf of the activist shareholder now control (through their new client, the reconstituted Board) the privilege over the very materials that were created in opposition to that shareholder's campaign creates an inherent tension.
The following categories of materials are of particular sensitivity in this context:
• The DGCL § 220 privilege log prepared in connection with Corvus Peak's books-and-records demand, which identifies by description the categories of materials withheld on privilege grounds and the bases for those claims.
• Special Committee records, including interview notes, deliberative memoranda, and candidate evaluation materials from the CEO succession process.
• The Jonathan Hale conflict of interest analysis (April 19, 2024), which examined the pre-existing relationship between Board member Jonathan Hale and Corvus Peak principal Damien Solberg, including their shared board service at Keystone Digital Ventures Ltd. Disclosure of this analysis could have significant implications for ongoing governance matters.
• The settlement analysis and recommendation memorandum (May 30, 2024), which contains game-theory analysis and recommended negotiation positions that were developed in anticipation of a potential settlement with Corvus Peak.
• The poison pill / shareholder rights plan analysis (April 8, 2024) and the internal deliberations surrounding the Board's April 10, 2024 decision not to adopt a rights plan.
• Internal vote projections and shareholder base analysis, which contain proprietary assessments of the voting tendencies of specific institutional holders, including Thorne Capital Management (6.3% holder), Ridgeway Asset Management (5.1% holder), and Windermere Pension Trust (4.4% holder).
The risk of inadvertent disclosure or privilege waiver during the transition period and thereafter must be treated with the utmost care. The protocols set forth in this memorandum are designed to mitigate these risks, and strict compliance is required.
II. SCOPE OF COVERED MATERIALS
A. Categories of Engagement Files
This protocol covers the entirety of the engagement file for Matter No. 1017-00002. The following is a comprehensive inventory of all materials within the matter file, organized by category. Every document, communication, draft, and record described below — whether delivered to the Client or retained internally — is subject to the retention, access control, and privilege preservation requirements of this protocol.
1. Engagement and Administrative Documents
This category encompasses the foundational documents governing the attorney-client relationship and the administrative records of the engagement:
• Engagement Letter dated March 12, 2024, addressed to Dame Elspeth Greenvale, Independent Non-Executive Chair of the Board of Directors of Aurelius Global Media Group PLC, setting forth the scope of the engagement, fee arrangements, billing rates, and the terms of the attorney-client relationship.
• Amended Engagement Letter dated April 22, 2024, expanding the scope of the engagement to include coordination with Stonebridge Crane & Co. (the Board's financial advisor) on the Board's review of strategic alternatives.
• Conflict Check Memorandum dated March 11, 2024, documenting the results of the firm's pre-engagement conflicts analysis, including identification of all parties and adverse parties.
• Matter Budget and Staffing Plan dated March 13, 2024, setting forth the projected staffing, timeline, and estimated budget for the engagement.
• Retainer Replenishment Acknowledgment dated June 14, 2024, confirming the replenishment of the $75,000 evergreen retainer in accordance with the quarterly replenishment schedule established in the engagement letter.
• Final Invoice to be dated July 8, 2024, reflecting the $312,817 outstanding balance for services rendered and expenses incurred through the termination of the engagement.
• Engagement Termination Acknowledgment Letter dated June 25, 2024 (from Nathaniel Bower to Vanessa Loring), confirming receipt of the June 21, 2024 termination notice and outlining the firm's transition obligations, the deadline for final deliverables, and the treatment of the outstanding retainer balance. A further formal closing letter is expected to issue on July 8, 2024.
2. Legal Memoranda and Analysis
This category constitutes the core substantive work product of the engagement. It includes all legal memoranda, analyses, and advisory documents prepared by the engagement team, whether delivered to the Client in final form or retained in draft.
Fiduciary Duty and Governance Memoranda (12 documents, March 17 through June 15, 2024). The following memoranda were prepared in connection with the Board's fiduciary duties, governance obligations, and related considerations during the CEO succession process and the activist campaign:
• Memorandum regarding Board fiduciary duties in CEO succession, dated March 25, 2024, providing an overview of the fiduciary standards applicable to the Board's selection of a new chief executive officer under Delaware law, including the duty of care, the duty of loyalty, and the applicability of the business judgment rule.
• Memorandum regarding interim CEO designation fiduciary considerations, dated March 28, 2024, analyzing the Board's authority to designate Priya Nair-Whitfield as Interim Chief Executive Officer and the fiduciary considerations attendant to such designation, including the scope of the Interim CEO's authority pending the permanent succession process.
• Memorandum regarding conflicts of interest analysis concerning Jonathan Hale and Corvus Peak Capital Partners LP, dated April 19, 2024. This memorandum examined the pre-existing professional and personal relationship between AGMG Board member Jonathan Hale and Damien Solberg, a principal of Corvus Peak, including their concurrent service on the board of directors of Keystone Digital Ventures Ltd., a privately held technology investment vehicle. The memorandum assessed the implications of this relationship for Hale's independence, his ability to participate in Board deliberations concerning the Corvus Peak campaign, and the potential disclosure obligations under applicable securities regulations and AGMG's Corporate Governance Guidelines.
• Memorandum regarding poison pill / shareholder rights plan analysis, dated April 8, 2024, analyzing the legal framework governing shareholder rights plans under Delaware law, including Moran v. Household International, Inc., 500 A.2d 1346 (Del. 1985), the Unocal enhanced scrutiny standard, and the Unitrin proportionality test, as applied to the specific facts of the Corvus Peak campaign and AGMG's governance structure. The memorandum concluded with a recommendation regarding the advisability of adopting a rights plan under the circumstances then prevailing.
• Memorandum regarding defensive measures survey, dated April 12, 2024, surveying the full range of defensive measures potentially available to the Board in response to the Corvus Peak campaign, including rights plans, bylaw amendments, white knight strategies, self-tender offers, and communication-based responses directed at institutional shareholders.
• Memorandum regarding UK regulatory considerations — FCA/DTR overlay, dated April 3, 2024, analyzing the disclosure and transparency obligations applicable to AGMG as a dual-listed company with a premium listing on the London Stock Exchange Main Market, with particular attention to the major shareholding notification requirements under DTR 5 of the FCA Disclosure Guidance and Transparency Rules and their application to Corvus Peak's accumulation of AGMG shares.
• Memorandum regarding D&O insurance implications of board reconstitution, dated June 11, 2024, analyzing the implications for directors' and officers' insurance coverage under the Helmsley Indemnity Corp. policy (Policy No. HIC-DOL-2024-009347) in the event of a change in Board composition, including Side A coverage for departing directors, the mechanics of run-off / tail coverage, and the reporting obligations triggered by the change in control of the Board.
• Memorandum regarding board process integrity post-reconstitution, dated June 12, 2024, addressing the governance and procedural considerations applicable to the newly reconstituted Board, including the reconstitution of Board committees, the treatment of pending Board actions, and the obligations of the incoming directors under AGMG's Amended and Restated Bylaws and Corporate Governance Guidelines.
• Four additional fiduciary duty and governance memoranda prepared between March 17 and June 15, 2024, addressing related topics as they arose during the course of the engagement.
Proxy Contest and Shareholder Activism Documents (14 documents, March 5 through June 8, 2024). The following documents were prepared in connection with the proxy contest initiated by Corvus Peak Capital Partners LP and the Board's response thereto:
• Memorandum regarding advance notice bylaw compliance review, dated March 5, 2024, analyzing whether Corvus Peak's March 1, 2024 director nominations complied with the advance notice provisions of AGMG's Amended and Restated Bylaws. The memorandum confirmed that Corvus Peak's nominations were submitted within the February 10 – March 11, 2024 nomination window and met the informational requirements of Bylaws Section 2.14.
• Memorandum regarding DGCL § 220 books-and-records demand response recommendations, dated March 26, 2024, analyzing the scope and legal sufficiency of Corvus Peak's March 22, 2024 demand under Section 220 of the Delaware General Corporation Law for inspection of AGMG's books and records, and recommending a response strategy designed to comply with the Company's legal obligations while protecting privileged and confidential materials.
• Shareholder base analysis and vote projections, dated May 1, 2024, providing a detailed analysis of AGMG's shareholder base, including the holdings and historical voting patterns of key institutional shareholders — including Thorne Capital Management (6.3% holder), Ridgeway Asset Management (5.1% holder), and Windermere Pension Trust (4.4% holder) — and projections of likely voting outcomes at the AGM under various scenarios.
• ISS and Tarrant Partners LLC policy framework analysis, dated May 8, 2024, analyzing the proxy advisory policies and methodologies of Cobalt Ridge Solutions (ISS) and Westmark Solutions as applied to contested board elections, and assessing the likely recommendations of each firm with respect to the Corvus Peak nominees.
• Post-ISS recommendation analysis, dated May 19, 2024, assessing the implications of the ISS recommendation (published May 17, 2024) for the Board's proxy solicitation strategy.
• Post-Tarrant Partners LLC recommendation analysis, dated May 24, 2024, assessing the implications of the Tarrant Partners LLC recommendation (published May 22, 2024) for the Board's proxy solicitation strategy.
• Settlement analysis and recommendation memorandum, dated May 30, 2024, containing a detailed game-theory analysis of potential settlement structures with Corvus Peak, including an assessment of the costs and benefits of various negotiated outcomes, the Board's alternative strategies in the absence of settlement, and a recommended negotiation framework and positions. This memorandum is classified as highly sensitive.
• Post-AGM vote analysis, dated June 8, 2024, providing a comprehensive analysis of the voting results at the June 7, 2024 Annual General Meeting, including the following detailed vote tallies:
Total shares voted: 351,280,400 of 412,600,000 shares outstanding (85.1% turnout).
• Six additional proxy contest and shareholder activism documents prepared between March 5 and June 8, 2024, addressing related topics as they arose during the course of the engagement.
Special Committee Materials (8 documents, March 18 through June 15, 2024). Eight documents were prepared in connection with the work of the Special Committee of the Board, which was established to oversee the CEO succession process and the strategic alternatives review. These materials include Special Committee charters, meeting agendas, summaries of deliberations, interview notes from the April 18, 2024 candidate evaluation sessions, and memoranda analyzing the Special Committee's fiduciary obligations.
Strategic Alternatives and Financial Advisor Coordination Documents (5 documents, April 21 through June 16, 2024). Five documents were prepared in connection with the expanded scope of the engagement relating to the Board's review of strategic alternatives and coordination with Stonebridge Crane & Co., the Board's financial advisor. These materials include Calderwood & Harkness's review of the Stonebridge Crane engagement letter (April 21, 2024), analyses of structural considerations for potential strategic transactions, and a termination analysis (June 16, 2024) addressing the tail fee exposure and other implications of the dissolution of the strategic alternatives review.
3. Draft Board Resolutions and Corporate Governance Documents
This category includes all draft board resolutions and corporate governance documents prepared by or with the assistance of Calderwood & Harkness during the engagement:
• Ten (10) draft board resolutions prepared between March 2024 and June 2024, covering the following actions:
(a) Designation of Priya Nair-Whitfield as Interim Chief Executive Officer;
(b) Authorization of the engagement of Calderwood & Harkness LLP as independent board governance counsel;
(c) Authorization of the engagement of Hargrove Tate Partners as the Board's executive search firm for the CEO succession process;
(d) Rejection of the proposed adoption of a shareholder rights plan (following the Board's April 10, 2024 deliberation);
(e) Authorization of the engagement of Stonebridge Crane & Co. as financial advisor to the Board in connection with the strategic alternatives review;
(f) Rejection of Corvus Peak Capital Partners LP's initial settlement proposal;
(g) Reopening of settlement discussions and consideration of Corvus Peak's revised settlement proposal;
(h) Post-AGM organizational matters, including the reconstitution of Board committees;
(i) Tabling of the CEO succession process indefinitely; and
(j) Dissolution of the Special Committee.
• Annotated summary of AGMG's Amended and Restated Bylaws (effective March 22, 2022), prepared as a reference document for the engagement team and the Board.
4. Correspondence. This category includes all correspondence generated or received during the engagement:
• Twelve (12) items of external correspondence, including letters and emails to and from the following individuals and entities:
• Dame Elspeth Greenvale, Independent Non-Executive Chair of the AGMG Board;
• Nadine Khalil, General Counsel and Corporate Secretary of AGMG;
• Dominic Sayer, Blackthorn Howell & Crane LLP (counsel to Corvus Peak during the activist campaign; now successor governance counsel to the reconstituted Board);
• Martin Cho, Ashworth Velmoran LLP (standing outside counsel to AGMG);
• Anil Kapoor-Mehta, Stonebridge Crane & Co. (financial advisor to the Board);
• Vanessa Loring, Chair of the reconstituted Nominating & Governance Committee; and
• Special Committee members: Tobias Kessler, Lucinda Farrow-Grant, and Dr. Anwen Llewellyn.
• Internal team communications, including research assignments, work allocation memoranda, file closing procedure instructions, and related administrative correspondence among members of the engagement team.
5. Transition and Closing Deliverables
This category includes all materials prepared in connection with the orderly transition and closing of the engagement:
• Transition Memorandum dated July 1, 2024, providing a comprehensive summary of the status of all matters handled during the engagement, key issues and developments, and recommendations for the incoming governance counsel.
• Privilege Log for Materials Withheld from § 220 Production dated July 1, 2024, identifying by category and description all materials withheld from production in response to Corvus Peak's March 22, 2024 books-and-records demand on the grounds of attorney-client privilege or attorney work product protection.
• Index of Work Product Delivered to Client dated July 1, 2024, cataloging all seventy-five (75) documents delivered to the Client during and at the conclusion of the engagement.
• Status Memorandum on Open and Unresolved Issues dated July 1, 2024, identifying and describing the following open matters requiring continued attention by the Client and successor counsel:
(a) The status of Corvus Peak's DGCL § 220 books-and-records demand and the potential for litigation in the Court of Chancery of the State of Delaware;
(b) D&O tail coverage considerations for departing directors under the Helmsley Indemnity Corp. policy;
(c) The status of the Hargrove Tate Partners contract, including the $500,000 in fees remaining unpaid under the $750,000 flat-fee arrangement;
(d) The status of the Stonebridge Crane & Co. engagement and the approximately $21.6 million in tail fee exposure (calculated as 0.25% of the estimated $8.65 billion enterprise value) if a change-of-control transaction is consummated within the 12-month tail period; and
(e) Continuing FCA/DTR disclosure obligations applicable to AGMG as a dual-listed company.
• Final Deliverables Transmittal Letter dated July 1, 2024, accompanying the delivery of the foregoing transition and closing materials to the Client.
6. Client-Provided Materials
This category includes all materials received from the Client or the Client's other advisors during the engagement:
• Corporate Records received from Nadine Khalil, General Counsel and Corporate Secretary, pursuant to Calderwood & Harkness's March 14, 2024 document request. These records include:
• AGMG's Restated Certificate of Incorporation (originally filed with the Delaware Secretary of State on September 14, 2009; last restated on March 22, 2022; Delaware File Number 4827193);
• AGMG's Amended and Restated Bylaws (effective March 22, 2022);
• Minutes of meetings of the Board of Directors and Board committees for the period 2021 through 2024;
• Charters of the Audit Committee, Compensation Committee, and Nominating & Governance Committee;
• The Employment Agreement of Marcus Vane, former Chief Executive Officer, including provisions regarding severance compensation of $14.8 million and a non-compete covenant with an 18-month term expiring September 8, 2025;
• Correspondence between AGMG and Corvus Peak Capital Partners LP;
• Schedule 13D filings by Corvus Peak Capital Partners LP (initial filing dated January 18, 2024, reporting a 6.1% ownership stake; amended filing dated February 26, 2024, reporting an 8.7% ownership stake / 35,896,200 shares acquired at an average cost of $20.97 per share).
• Proxy Statements, including: AGMG's preliminary proxy statement filed April 5, 2024; AGMG's definitive proxy statement filed May 3, 2024; Corvus Peak's preliminary proxy statement filed April 1, 2024; and Corvus Peak's definitive proxy statement filed May 6, 2024.
• Hargrove Tate Partners Engagement Documents and CEO Search Materials, including the engagement letter, candidate profiles, interview schedules, and related materials provided in connection with the CEO succession process.
• Stonebridge Crane & Co. Engagement Letter and Related Strategic Alternatives Materials, including the engagement letter, preliminary analyses, and related materials provided in connection with the Board's review of strategic alternatives.
• D&O Insurance Policy and Related Correspondence, including the directors' and officers' liability insurance policy issued by Helmsley Indemnity Corp. (Policy No. HIC-DOL-2024-009347), providing coverage of $75 million per occurrence and $150 million in the aggregate at an annual premium of $3.8 million, together with related correspondence regarding coverage questions raised during the engagement.
7. Internal Work Product and Research
This category encompasses all materials prepared by the engagement team that were not delivered to the Client and are retained as firm-file materials:
• Internal research memoranda and preliminary analyses prepared in connection with the engagement.
• Research notes, including Brendan Walsh's research on the Blasius standard (Blasius Industries, Inc. v. Atlas Corp., 564 A.2d 651 (Del. Ch. 1988)) prepared pursuant to an April 25, 2024 assignment from Audrey Zhou.
• Draft-stage memoranda and mark-ups of client deliverables that were not delivered to the Client in their final form, including preliminary versions of the fiduciary duty memoranda, the settlement analysis, and the proxy contest documents.
• Internal emails among members of the engagement team relating to research assignments, analytical frameworks, strategic assessments, case management, and administrative matters.
• Time entries and billing records for all timekeepers assigned to the matter, including detailed narrative descriptions of services rendered.
B. Total Document Count
As reflected in the Index of Work Product Delivered to Client dated July 1, 2024, a total of seventy-five (75) documents were cataloged and delivered to the Client during and at the conclusion of the engagement. In addition to these client-deliverable materials, the matter file contains a substantial body of internal-only materials not delivered to the Client, including drafts, research notes, internal correspondence, billing records, and administrative documents.
All materials within the matter file — whether delivered to the Client or retained internally as firm-file materials — are covered by this protocol and are subject to the retention, access control, privilege preservation, and file organization requirements set forth herein. No distinction is to be drawn between client-file and firm-file materials for purposes of the retention hold or the prohibition on unauthorized disclosure; both categories are equally subject to this protocol.
III. PRIVILEGE CLASSIFICATION AND PRESERVATION
A. Privilege Categories
The materials within the Matter No. 1017-00002 engagement file are subject to one or more of the following categories of privilege or protection:
Attorney-Client Privilege. The attorney-client privilege protects from disclosure all confidential communications between Calderwood & Harkness attorneys and AGMG Board members, officers (including, but not limited to, Nadine Khalil, General Counsel and Corporate Secretary, and Garrett Voss, Chief Financial Officer), and other authorized representatives of the Client, made for the purpose of providing or obtaining legal advice in connection with the engagement. The privilege extends to communications in all forms — oral, written, and electronic — and encompasses the substance of those communications as well as the fact that they occurred, to the extent that disclosure of the fact of communication would reveal the substance of legal advice rendered.
Attorney Work Product Doctrine. The attorney work product doctrine, as established by Hickman v. Taylor, 329 U.S. 495 (1947), and codified in Rule 26(b)(3) of the Federal Rules of Civil Procedure and its state-law equivalents, protects from discovery all documents and tangible things prepared by or at the direction of Calderwood & Harkness attorneys in anticipation of litigation or in connection with the provision of legal services. This protection encompasses internal research memoranda, draft analyses, mental impressions, conclusions, opinions, legal theories, and litigation strategy documents. The engagement team should note that "opinion" work product — reflecting the mental impressions, conclusions, opinions, or legal theories of an attorney — receives the highest level of protection and is virtually immune from discovery. A substantial portion of the internal work product generated during this engagement qualifies as opinion work product, including the settlement analysis, the vote projection analyses, the conflict of interest assessment regarding Jonathan Hale, and the strategic recommendations contained in the various governance memoranda.
Joint Defense / Common Interest Materials. No formal joint defense agreement or common interest agreement was executed during this engagement. However, certain communications between Calderwood & Harkness and Ashworth Velmoran LLP (AGMG's standing outside counsel, led by partner Martin Cho) were conducted pursuant to a coordination protocol established by letter dated March 19, 2024. This coordination protocol, while not a formal common interest agreement, may give rise to arguments that certain shared communications and materials are protected under the common interest doctrine, which extends the attorney-client privilege to communications between co-counsel or counsel for parties with a shared legal interest. Materials exchanged under or pursuant to the March 19, 2024 coordination protocol should be flagged separately in the file organization and should be treated as potentially subject to common interest privilege claims. Any future request for production of these materials should be assessed with particular care, and the engagement team should consult with Nathaniel Bower before taking any position with respect to the existence or scope of common interest protection.
B. Privilege Holder
The attorney-client privilege belongs to the client — Aurelius Global Media Group PLC, acting through its Board of Directors — and not to Calderwood & Harkness. This fundamental principle has several important implications for the firm's post-termination obligations:
First, Calderwood & Harkness cannot unilaterally waive the Client's privilege. Only the Client, acting through its Board of Directors or other authorized representatives (such as the General Counsel), has the authority to waive the privilege attaching to communications and materials generated during the engagement.
Second, following the termination of the engagement, it is the reconstituted Board that controls privilege decisions with respect to the engagement file. This means that the reconstituted Board — including the three Corvus Peak nominees who now serve as directors — has the authority to waive the privilege over Calderwood & Harkness's work product if it chooses to do so. The firm has no legal basis to prevent such a waiver, although the firm may (and should) take reasonable steps to ensure that any waiver is knowing and voluntary and is not the product of inadvertent disclosure by the firm.
Third, notwithstanding the Client's control over privilege waiver decisions, Calderwood & Harkness's independent obligation to preserve the privilege continues after the termination of the engagement. The firm must take all reasonable steps to prevent inadvertent disclosure of privileged materials, regardless of whether the Client might ultimately choose to waive the privilege. This obligation arises under the firm's professional and ethical duties and is distinct from the Client's own privilege decisions.
Fourth, and critically, the reconstituted Board's decision to engage Blackthorn Howell & Crane LLP — a firm that previously represented the opposing party, Corvus Peak Capital Partners LP, in the same activist campaign — as successor governance counsel heightens the practical risk that the new Board could choose to waive the privilege over Calderwood & Harkness's work product and share that work product with attorneys who, until very recently, were adverse to the interests served by that work product. While this possibility is troubling from a practical standpoint, it does not alter Calderwood & Harkness's preservation obligations. The firm must continue to protect the privilege as if no waiver had occurred or were contemplated, unless and until it receives clear and unambiguous written instructions from an authorized representative of the Client directing otherwise.
C. Specific Privilege Sensitivities
In light of the considerations described in Sections I.D and III.B above, the following categories of materials are identified as possessing heightened privilege sensitivity and should be treated with particular care:
1. Jonathan Hale Conflict of Interest Analysis (April 19, 2024). This memorandum examines the pre-existing relationship between AGMG Board member Jonathan Hale and Corvus Peak principal Damien Solberg, including their concurrent board service at Keystone Digital Ventures Ltd. Disclosure of this analysis could reveal the Board's internal assessment of a sitting director's independence and potential conflicts, with significant implications for ongoing governance and potential future litigation.
2. Special Committee Interview Notes and Candidate Evaluations (April 18, 2024 sessions). These materials contain the Special Committee's deliberative assessments of CEO candidates, including subjective evaluations and comparative analyses. Disclosure could expose the Board's internal deliberative process and the substance of confidential candidate assessments.
3. Settlement Analysis and Recommendation Memorandum (May 30, 2024). This memorandum contains a game-theory analysis of potential settlement outcomes with Corvus Peak, recommended negotiation positions, and an assessment of the Board's best alternative to a negotiated agreement (BATNA). Disclosure to successor counsel previously representing Corvus Peak would directly reveal the Board's former litigation and negotiation strategy.
4. Poison Pill Analysis (April 8, 2024) and Board Decision (April 10, 2024). These materials reflect the Board's internal deliberations regarding defensive measures, including the legal analysis supporting the Board's decision not to adopt a shareholder rights plan. Disclosure could expose the Board's strategic calculus in responding to the activist campaign.
5. DGCL § 220 Response Strategy and Privilege Log (March 26, 2024 and July 1, 2024). These materials reflect the legal strategy employed in responding to Corvus Peak's books-and-records demand, including the bases for asserting privilege over specific categories of documents. Disclosure of the underlying strategy could undermine the privilege claims asserted in the privilege log.
6. Internal Vote Projections and Shareholder Base Analysis (May 1, 2024). These materials contain proprietary assessments of the voting tendencies of specific institutional holders, including Thorne Capital Management (6.3%), Ridgeway Asset Management (5.1%), and Windermere Pension Trust (4.4%). These assessments were based on confidential engagement team analysis and, if disclosed, could expose the Board's strategic assessments of its shareholder base and voting dynamics.
D. Measures to Prevent Inadvertent Waiver
The following measures are mandatory and shall be observed by all members of the engagement team without exception:
1. No Unauthorized Transmissions. No engagement file materials — whether in physical, electronic, or any other form — shall be transmitted to any party, including the Client, successor counsel (Blackthorn Howell & Crane LLP or any other firm), the Client's General Counsel (Nadine Khalil), former or current Board members, regulatory authorities, or any third party, without the prior written approval of Nathaniel Bower. This prohibition applies regardless of the nature or apparent sensitivity of the materials in question and regardless of the identity or authority of the requesting party.
2. Physical File Security. All physical file materials related to Matter No. 1017-00002 shall be secured in the firm's locked file room located at 787 Seventh Avenue, records management facility, floor B2. Physical files shall be stored in sealed, labeled file boxes as described in Section V.A below. Access to the physical file room for purposes of retrieving or reviewing matter files shall require authorization from the Responsible Partner or, in his absence, the Billing Partner.
3. Electronic File Security. All electronic files related to Matter No. 1017-00002 shall be maintained in the firm's secure document management system (DMS). Access to the electronic matter workspace shall be restricted to the authorized personnel identified in Section VI.A below. The engagement team shall not maintain copies of engagement materials on personal devices, external storage media, personal email accounts, or any system outside the firm's secure network.
4. Routing of External Requests. Any request for engagement materials — whether received from the reconstituted Board, Nadine Khalil, Vanessa Loring, successor counsel (including but not limited to Blackthorn Howell & Crane LLP or Dominic Sayer personally), Martin Cho at Ashworth Velmoran LLP, Corvus Peak Capital Partners LP, any regulatory authority, or any other party — must be immediately routed to Nathaniel Bower for assessment before any response is provided or any materials are produced. No member of the engagement team other than Nathaniel Bower is authorized to respond to such requests, even to acknowledge receipt. If the request is received by telephone, the team member should take a message and state that the matter will be referred to the appropriate partner.
5. Subpoena and Court Order Protocol. In the event that a subpoena, court order, or other compulsory legal process is received for engagement materials, the firm's litigation department must be immediately notified. In addition, the Client must be given reasonable notice and a meaningful opportunity to assert the attorney-client privilege or any other applicable privilege or protection before any production is made. No production shall be made in response to compulsory process without the prior approval of Nathaniel Bower and the firm's General Counsel, and only after the Client has been afforded the opportunity to intervene or object.
6. Inadvertent Disclosure Protocol. In the event that any member of the engagement team becomes aware of, or suspects, an inadvertent disclosure of privileged materials — whether by the firm or by any third party — the team member shall immediately notify Nathaniel Bower. The firm will take all steps available under applicable law to remediate the disclosure and preserve the privilege, including invoking the protections of Federal Rule of Evidence 502(b) and any applicable state-law equivalents.
IV. DOCUMENT RETENTION PERIOD AND POLICY
A. Retention Period
All materials related to Matter No. 1017-00002 — encompassing every category of document described in Section II above, whether constituting client-file materials or firm-file materials, and whether in physical or electronic form — shall be placed on a seven (7) year retention hold in accordance with Calderwood & Harkness LLP's standard document retention policy as set forth in Firm Policy Memorandum No. RMG-2019-003 (as amended).
The retention period commences on the formal engagement termination date of July 8, 2024. Accordingly, the earliest permissible date for the destruction of any materials subject to this retention hold is July 8, 2031.
No materials may be destroyed before the expiration of the retention period without prior written authorization from both (i) the Responsible Partner (Nathaniel Bower) and (ii) the firm's General Counsel. Any such authorization must be documented in writing and placed in the firm file. The Responsible Partner's annual review obligations, as described in Section VIII.C below, include an affirmative assessment of whether any circumstances exist that would preclude destruction at the expiration of the retention period.
B. Extended Hold Considerations
The seven-year retention hold established by this protocol represents the minimum retention period. The hold may be extended beyond July 8, 2031 if any of the following circumstances arise at any time during the retention period:
1. Litigation. If any litigation arises in which the engagement or the engagement materials are or may be relevant, including but not limited to: (a) litigation in the Court of Chancery of the State of Delaware arising from Corvus Peak's pending DGCL § 220 books-and-records demand, which as of the date of this protocol remains partially unresolved; (b) any derivative action, securities class action, or other shareholder litigation relating to the CEO succession process, the Board's response to the Corvus Peak campaign, or the actions of the reconstituted Board; or (c) any breach of contract or fee dispute arising from the engagement, including any dispute regarding the $312,817 outstanding balance.
2. Regulatory Investigations. If any regulatory investigation or governmental inquiry arises involving the engagement, the parties to the engagement, or the subject matter of the engagement, including but not limited to investigations by the Securities and Exchange Commission, the Financial Conduct Authority, or any other regulatory body.
3. Litigation Hold Notices. If a litigation hold notice is issued by the firm, by the Client, or by any other party that would encompass materials within the engagement file.
4. DGCL § 220 Proceedings. The pending DGCL § 220 books-and-records dispute between Corvus Peak and AGMG remains unresolved as of the date of this protocol and could lead to further proceedings in the Court of Chancery of the State of Delaware. AGMG's Amended and Restated Bylaws (Section 11.1) designate the Court of Chancery as the exclusive forum for such proceedings. If the § 220 dispute proceeds to litigation, the retention hold shall be automatically extended for the duration of such proceedings and for a period of one year following final resolution (including exhaustion of all appeals).
5. D&O Insurance Claims. If any claim is filed under the Helmsley Indemnity Corp. directors' and officers' liability insurance policy (Policy No. HIC-DOL-2024-009347; policy period January 1, 2024 through December 31, 2024) that may implicate the engagement or the matters addressed during the engagement, the retention hold shall be extended for the duration of such claim and for a period of one year following final resolution.
Monitoring Responsibility. Audrey Zhou is hereby designated as the point person for monitoring extended hold triggers through December 31, 2025. In this capacity, Audrey Zhou shall: (a) monitor public filings, press releases, and court dockets for developments relating to AGMG, Corvus Peak, or the subject matter of the engagement; (b) review incoming correspondence and communications that may indicate the existence of an extended hold trigger; (c) promptly notify Nathaniel Bower of any development that may warrant extension of the retention hold; and (d) document all monitoring activities in periodic memoranda to the firm file. At the conclusion of the monitoring period on December 31, 2025, Nathaniel Bower shall assess whether to extend the monitoring assignment or to transition monitoring responsibility to another team member.
C. No Spoliation
Under no circumstances shall any member of the engagement team — or any other Calderwood & Harkness personnel — delete, destroy, alter, modify, redact, or remove from firm systems any document, communication, file, electronic record, or other material related to Matter No. 1017-00002. This prohibition applies to all materials in all forms, including but not limited to paper files, electronic documents, emails, text messages, voicemail recordings, calendar entries, time entries, billing records, and metadata.
This instruction is absolute and supersedes any general firm clean-up policies, email purge schedules, document management system archiving protocols, or other routine records management practices that might otherwise result in the modification or destruction of engagement materials. Team members who receive automated prompts from the firm's email or document management systems to archive or delete materials related to this matter should disregard such prompts and should contact Audrey Zhou if they have any questions about how to ensure the materials are preserved.
The consequences of spoliation of evidence — whether intentional or negligent — are severe and may include adverse inference instructions, sanctions, disciplinary action, and personal liability. All team members are expected to exercise the highest degree of care in ensuring the complete preservation of all engagement materials.
V. FILE ORGANIZATION AND CLOSING PROCEDURES
A. Physical File Organization
All physical files (if any) related to Matter No. 1017-00002 shall be organized in accordance with the eight-category structure established in the Index of Work Product Delivered to Client dated July 1, 2024, as follows:
Category I: Engagement & Administrative Documents
Category II: Fiduciary Duty & Governance Memoranda
Category III: Proxy Contest & Shareholder Activism Documents