1030-00001 · Dralvecen Fenn & Co., Inc · Engagement

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CALDERWOOD & HARKNESS LLP

MEMORANDUM

CONFIDENTIAL / ATTORNEY WORK PRODUCT / ATTORNEY-CLIENT PRIVILEGED

TO: George Trujillo, Partner, Energy & Infrastructure

FROM: Michelle Tsao, Associate, Energy & Infrastructure

DATE: April 18, 2023

RE: Conflicts Check and Clearance — Cascadia State Infrastructure Authority, Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt) — $220,000,000 Municipal Revenue Bond Financing

MATTER NO.: 1030-00001

STATUS: CLEARED — No Conflicts Identified

I. Purpose and Summary

This memorandum documents the results of the conflicts check conducted in connection with the proposed engagement of Calderwood & Harkness LLP ("C&H" or the "Firm") as issuer's counsel to the Cascadia State Infrastructure Authority ("CSIA" or "Cascadia") in connection with the issuance of $220,000,000 aggregate principal amount of Cascadia State Infrastructure Authority Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt) (the "Bonds" or the "Series 2023A Bonds"). The proceeds of the Bonds will be used to fund the design, construction, and commissioning of the Puget Sound Regional Advanced Water Treatment Facility, a state-of-the-art water treatment facility to be located in Thurston County, Washington (the "Project"). The Project is expected to serve approximately 450,000 residents in the greater Puget Sound region upon completion.

C&H has been asked to serve as issuer's counsel in connection with this financing, providing legal services to CSIA in its capacity as the borrower and issuer of the Bonds. Pryor Crestfield LLP, a Seattle-based law firm, will serve as co-Bond Counsel, providing the approving legal opinion and tax opinion under Washington law. This co-counsel arrangement reflects the customary practice in Washington State municipal bond financings of this magnitude, where local bond counsel with specific expertise in Washington municipal finance law collaborates with nationally recognized issuer's counsel to ensure comprehensive legal coverage.

The engagement letter between C&H and CSIA was fully executed today, April 18, 2023, following completion of the conflicts clearance process described herein.

Conclusion: A comprehensive conflicts search has been completed against all identified parties to this transaction, their known affiliates, and key personnel associated with each party. No conflicts of interest, whether actual, potential, or reasonably foreseeable, have been identified. This matter is cleared for acceptance and staffing. The Firm may proceed with full representation of CSIA in all aspects of the Series 2023A Bond financing.

II. Engagement Team

The following C&H attorneys have been designated as the engagement team for this matter:

Each member of the engagement team has been personally cleared through the Firm's conflicts system and has confirmed that he or she has no personal conflicts of interest, financial interests, or prior relationships with any party to this transaction that would impair the Firm's ability to represent CSIA in this matter.

It is noted for the record that billing rates are informational only, as this engagement will be conducted on a fixed-fee basis. The Firm's agreed-upon fixed fee for the representation is $485,000, plus reimbursable expenses, which are capped at $35,000. The fee arrangement is set forth in detail in the executed engagement letter dated April 18, 2023.

III. Client Identification

The client for this engagement is the Cascadia State Infrastructure Authority. The following information has been confirmed and entered into the Firm's intake system:

Full Legal Name: Cascadia State Infrastructure Authority

Entity Type: Washington State governmental instrumentality and public body corporate, created and existing under and pursuant to Chapter 43.160A of the Revised Code of Washington (RCW). CSIA was established by the Washington State Legislature as a special-purpose governmental entity authorized to issue revenue bonds and other obligations to finance critical public infrastructure, including water, wastewater, transportation, and energy infrastructure projects.

Headquarters Address: 1100 Capitol Way South, Suite 400, Olympia, WA 98501

Employer Identification Number (EIN): 91-2058374

Role in Transaction: Borrower and Issuer of the Series 2023A Revenue Bonds

Key Personnel Searched: The following individuals affiliated with CSIA were identified and searched through the Firm's conflicts database:

• Harold K. Nakamura, Executive Director — Mr. Nakamura is the chief executive officer of CSIA and serves as the authorized signatory for the Bond Resolution and related transaction documents. Mr. Nakamura has served as Executive Director since 2019.

• Denise R. Whitford, Chief Financial Officer — Ms. Whitford oversees CSIA's financial operations, including debt management, budgeting, and financial reporting. She is a principal point of contact for the Firm in connection with the preparation of financial disclosures in the Official Statement.

• Martin J. Espinoza, General Counsel — Mr. Espinoza serves as in-house legal counsel to CSIA and will coordinate with C&H and Pryor Crestfield on all legal matters related to the financing.

• Commissioner Lorraine Chu, Board Chair — Commissioner Chu chairs the CSIA Board of Commissioners, which has adopted the authorizing resolution for the Series 2023A Bonds.

All searches for the client entity and its key personnel returned clean results. No conflicts were identified.

IV. Transaction Parties Searched

In accordance with the Firm's conflicts policies and the requirements of the Washington Rules of Professional Conduct (as adopted by the Washington Supreme Court) and the American Bar Association Model Rules of Professional Conduct, a conflicts search was conducted against each party to the transaction, as well as the key personnel associated with each party. The parties searched, and the results of those searches, are set forth below.

A. Underwriters

1. Meridian Capital Partners LLC (Senior Managing Underwriter)

Full Legal Name: Meridian Capital Partners LLC

Entity Type: Delaware limited liability company; registered as a broker-dealer with the Financial Industry Regulatory Authority (FINRA) and as a municipal securities dealer with the Municipal Securities Rulemaking Board (MSRB).

Principal Office: 600 Third Avenue, 28th Floor, New York, NY 10016

Role in Transaction: Lead underwriter and book-running senior manager for the Series 2023A Bonds. Meridian Capital Partners will serve as the primary underwriter responsible for structuring the offering, leading the marketing effort, and managing the book-building process. In its capacity as senior managing underwriter, Meridian will be the lead signatory to the Bond Purchase Agreement between the underwriting syndicate and CSIA.

Key Personnel Searched: Jonathan D. Kessler, Managing Director, Public Finance Division. Mr. Kessler is the lead banker responsible for the Meridian Capital Partners engagement with CSIA.

Search Result: No conflicts identified. C&H has no current or recent engagement involving Meridian Capital Partners LLC as a client, adverse party, counterparty, or other interested party in any matter. The Firm's conflicts database returned no results for Meridian Capital Partners LLC, its known affiliates, or Mr. Kessler. Accordingly, no conflict exists with respect to Meridian Capital Partners' participation in this transaction.

2. Dralvecen Fenn & Co., Inc. (Co-Managing Underwriter)

Full Legal Name: Dralvecen Fenn & Co., Inc.

Entity Type: New York corporation; registered as a broker-dealer with FINRA and as a municipal securities dealer with the MSRB.

Principal Office: 200 Park Avenue, Suite 3100, New York, NY 10166

Role in Transaction: Co-managing underwriter for the Series 2023A Bonds. Dralvecen Fenn will participate in the underwriting syndicate alongside Meridian Capital Partners and will be allocated a portion of the Bonds for distribution to institutional and retail investors. Dralvecen Fenn will also be a signatory to the Bond Purchase Agreement.

Key Personnel Searched: Sarah E. Mulvaney, Director, Municipal Finance Group. Ms. Mulvaney is the lead Dralvecen Fenn professional assigned to this transaction.

Search Result: No conflicts identified. C&H has no current or recent engagement involving Dralvecen Fenn & Co., Inc. as a client, adverse party, counterparty, or other interested party in any matter. The Firm's conflicts database returned no results for Dralvecen Fenn & Co., Inc., its known affiliates, or Ms. Mulvaney. Accordingly, no conflict exists with respect to Dralvecen Fenn's participation in this transaction.

B. Bond Trustee / Paying Agent / Registrar / Escrow Agent

3. Pacific Northwest Trust Company, N.A. (PNTC)

Full Legal Name: Pacific Northwest Trust Company, National Association

Entity Type: National banking association, chartered by and operating under the supervision of the Office of the Comptroller of the Currency (OCC).

Principal Office: 1201 Third Avenue, Suite 1600, Seattle, WA 98101

Role in Transaction: Bond Trustee, Paying Agent, Registrar, and Escrow Agent under the Bond Indenture. PNTC will hold and administer the trust estate securing the Bonds, including the Revenue Fund, the Debt Service Fund, the Debt Service Reserve Fund, and the Construction Fund. PNTC will also serve as paying agent and registrar for the Bonds, and as escrow agent for any refunded obligations.

Key Personnel Searched: Alan M. Greer, Vice President, Corporate Trust Services Division. Mr. Greer will serve as PNTC's primary relationship manager for the CSIA trust account.

Search Result: No conflicts identified. The Firm's conflicts database returned results indicating that C&H has previously represented Pacific Northwest Trust Company, N.A. in its capacity as indenture trustee in certain prior, unrelated trust indenture matters. Specifically, the Firm represented PNTC in connection with (i) a successor trustee appointment under a 2019 corporate bond indenture (Matter No. 1030-00001, closed December 2020), and (ii) a trustee consent solicitation in connection with an amendment to a 2017 project finance indenture (Matter No. 1030-00001, closed August 2021). Both of these prior matters are fully closed and are entirely unrelated to CSIA, the Series 2023A Bond financing, or any of the other parties to the current transaction.

These prior representations do not give rise to any actual or potential conflict of interest with the current engagement. In the current transaction, PNTC is not the client; PNTC serves as the institutional trustee under the Bond Indenture. CSIA is the Firm's sole client. No adverse representation exists between C&H's representation of CSIA as issuer and PNTC's role as trustee. The relationship between the issuer and the bond trustee under a revenue bond indenture is a cooperative, contractual relationship in which both parties' interests are generally aligned with respect to the successful issuance and administration of the Bonds. Moreover, no confidential information obtained during the prior representations of PNTC is relevant to or could be used in connection with this matter. A more detailed analysis of this issue is set forth in Section VI.B below.

C. Bond Insurer / Surety Provider

4. Olympia Guaranty Insurance Corp.

Full Legal Name: Olympia Guaranty Insurance Corp.

Entity Type: New York-domiciled financial guaranty insurance company, licensed and regulated by the New York State Department of Financial Services.

Principal Office: 125 Broad Street, 14th Floor, New York, NY 10004

Role in Transaction: Municipal bond insurance provider. Olympia Guaranty will issue a debt-service reserve surety policy (Surety Policy No. OG-2023-MUN-4718) in connection with the Series 2023A Bonds. The surety policy will satisfy the Debt Service Reserve Fund requirement under the Bond Indenture in lieu of a cash-funded reserve. Olympia Guaranty may also provide a bond insurance policy guaranteeing the timely payment of principal and interest on the Bonds, subject to final credit approval and pricing.

Key Personnel Searched: Rachel P. Dominguez, Senior Vice President, Public Finance Guaranty Division. Ms. Dominguez is the Olympia Guaranty underwriting professional responsible for the CSIA credit.

Search Result: No conflicts identified. C&H has no current or recent engagement involving Olympia Guaranty Insurance Corp. as a client, adverse party, counterparty, or other interested party. The Firm's conflicts database returned no results for Olympia Guaranty Insurance Corp., its known affiliates, or Ms. Dominguez. Accordingly, no conflict exists with respect to Olympia Guaranty's participation in this transaction.

D. Co-Bond Counsel

5. Pryor Crestfield LLP

Full Legal Name: Pryor Crestfield LLP

Entity Type: Washington limited liability partnership; a law firm registered with the Washington State Bar Association.

Office: 999 Third Avenue, Suite 4800, Seattle, WA 98104

Role in Transaction: Co-Bond Counsel. Pryor Crestfield will serve alongside C&H as co-Bond Counsel for the Series 2023A Bonds, providing the approving legal opinion as to the validity and enforceability of the Bonds under Washington law and the tax opinion as to the excludability of interest on the Bonds from gross income for federal income tax purposes. Pryor Crestfield's role reflects its deep expertise in Washington State municipal bond law and its established relationship with CSIA. The co-Bond Counsel arrangement is documented in a separate co-counsel agreement between C&H and Pryor Crestfield, dated April 18, 2023.

Key Personnel Searched: Margaret S. Yoon, Partner, Public Finance Practice Group; Elliot R. Stanton, Associate, Public Finance Practice Group. Ms. Yoon will serve as the lead Pryor Crestfield partner on this engagement.

Search Result: No conflicts identified. Pryor Crestfield is co-counsel to C&H in this matter, and both firms owe fiduciary duties to CSIA in their respective capacities. No adversity exists between C&H and Pryor Crestfield, and their interests are fully aligned in serving the client. The Firm's conflicts database returned no results indicating any current or prior adverse relationship with Pryor Crestfield LLP, Ms. Yoon, or Mr. Stanton.

E. Underwriters' Counsel

6. Alderman & Locke LLP

Full Legal Name: Alderman & Locke LLP

Entity Type: New York limited liability partnership; a law firm registered with the New York State Bar.

Office: 51 West 52nd Street, New York, NY 10019

Role in Transaction: Counsel to the underwriters. Alderman & Locke will represent Meridian Capital Partners LLC and Dralvecen Fenn & Co., Inc. in their capacities as senior managing underwriter and co-managing underwriter, respectively. In this role, Alderman & Locke will negotiate the Bond Purchase Agreement on behalf of the underwriters, review the Official Statement for due diligence purposes, and render a disclosure opinion to the underwriters.

Key Personnel Searched: Daniel F. Obermeyer, Partner, Municipal Securities Practice Group; Christina M. Vega, Associate, Municipal Securities Practice Group.

Search Result: No conflicts identified. While Alderman & Locke represents the underwriters, whose interests may differ from those of the issuer on certain negotiation points — including, without limitation, the underwriters' discount, the form and scope of representations and warranties in the Bond Purchase Agreement, and the scope of the continuing disclosure undertaking — this is the customary and expected multi-party structure in municipal bond transactions and does not constitute a conflict of interest for C&H. C&H and Alderman & Locke will engage in arms-length negotiations on behalf of their respective clients, which is standard practice in public finance transactions. The Firm's conflicts database returned no results indicating any current or prior adverse relationship with Alderman & Locke LLP, Mr. Obermeyer, or Ms. Vega.

F. Municipal Advisor

7. Clearfield Municipal Advisors LLC

Full Legal Name: Clearfield Municipal Advisors LLC

Entity Type: Oregon limited liability company; registered as a municipal advisor with the Securities and Exchange Commission (SEC) and the MSRB.

Office: 805 SW Broadway, Suite 1400, Portland, OR 97205

Role in Transaction: Independent municipal advisor to CSIA. Clearfield Municipal Advisors serves as CSIA's registered municipal advisor under MSRB Rule G-42 and owes a fiduciary duty to CSIA. In this capacity, Clearfield will advise CSIA on the structure, timing, and pricing of the Series 2023A Bonds, assist in the selection of the underwriting team, and review all financial terms of the Bond Purchase Agreement for reasonableness. Clearfield's role is advisory and non-legal in nature and is complementary to the legal services provided by C&H and Pryor Crestfield.

Key Personnel Searched: Kenneth W. Barclay, Principal. Mr. Barclay will serve as the lead municipal advisor on this transaction.

Search Result: No conflicts identified. C&H has no current or recent engagement involving Clearfield Municipal Advisors LLC as a client, adverse party, counterparty, or other interested party. The Firm's conflicts database returned no results for Clearfield Municipal Advisors LLC, its known affiliates, or Mr. Barclay. Accordingly, no conflict exists with respect to Clearfield's participation in this transaction.

G. Independent Auditor

8. Hargrove & Associates CPAs, PLLC

Full Legal Name: Hargrove & Associates CPAs, PLLC

Entity Type: Washington professional limited liability company; a certified public accounting firm registered with the Washington State Board of Accountancy.

Office: 520 Pike Street, Suite 2200, Seattle, WA 98101

Role in Transaction: Independent auditor of CSIA. Hargrove & Associates provides annual audit services to CSIA in accordance with generally accepted government auditing standards (GAGAS) and has prepared the audited financial statements that will be incorporated into or appended to the Official Statement for the Series 2023A Bonds. Hargrove's audit opinion on CSIA's financial statements is a critical component of the disclosure package.

Key Personnel Searched: Victoria L. Fong, CPA, Engagement Partner. Ms. Fong is the lead audit partner for the CSIA engagement at Hargrove & Associates.

Search Result: No conflicts identified. C&H has no current or recent engagement involving Hargrove & Associates CPAs, PLLC as a client, adverse party, counterparty, or other interested party. The Firm's conflicts database returned no results for Hargrove & Associates CPAs, PLLC, its known affiliates, or Ms. Fong. Accordingly, no conflict exists with respect to Hargrove's participation in this transaction.

H. Design-Build Contractor

9. Northtide Environmental Engineering, Inc.

Full Legal Name: Northtide Environmental Engineering, Inc.

Entity Type: Washington corporation; a design-build construction firm specializing in water and wastewater infrastructure.

Headquarters: 2400 Eastlake Avenue East, Seattle, WA 98102

Role in Transaction: Design-build contractor for the Puget Sound Regional Advanced Water Treatment Facility (the "Project"). Northtide Environmental Engineering was awarded the design-build contract by CSIA following a competitive procurement process. The design-build contract (GMP Contract No. CSIA-DB-2023-001) was executed on March 10, 2023, and establishes a guaranteed maximum price (GMP) of $193,500,000 for the complete design and construction of the Project. A significant portion of the Series 2023A Bond proceeds will be applied to fund construction draws under this contract.

Key Personnel Searched: Garrett L. Henriksen, Chief Executive Officer.

Search Result: No conflicts identified. C&H has no current or recent engagement involving Northtide Environmental Engineering, Inc. as a client, adverse party, counterparty, or other interested party. The Firm's conflicts database returned no results for Northtide Environmental Engineering, Inc., its known affiliates, or Mr. Henriksen. Accordingly, no conflict exists with respect to Northtide's participation in this transaction.

I. Rating Agencies

10. Lakeshore Ratings Group, Inc.

Full Legal Name: Lakeshore Ratings Group, Inc.

Entity Type: Delaware corporation; registered with the SEC as a nationally recognized statistical rating organization (NRSRO).

Office: 55 Water Street, New York, NY 10041

Role in Transaction: Rating agency. Lakeshore Ratings Group has been engaged by CSIA to provide a credit rating on the Series 2023A Bonds. Lakeshore's rating will be disclosed in the Official Statement and is a material factor in the marketability and pricing of the Bonds.

Key Personnel Searched: No specific key personnel were identified for individual search, as the rating agency interaction is conducted at the institutional level and does not involve a personalized engagement relationship.

Search Result: No conflicts identified. Rating agencies function as independent third parties providing credit assessments to the capital markets. C&H does not represent and has not represented Lakeshore Ratings Group, Inc. in any capacity, and no adversity exists between C&H's representation of CSIA and Lakeshore's role as an independent rating agency.

11. Pinnacle Credit Analytics, Inc.

Full Legal Name: Pinnacle Credit Analytics, Inc.

Entity Type: Delaware corporation; registered with the SEC as a nationally recognized statistical rating organization (NRSRO).

Office: 33 Whitehall Street, New York, NY 10004

Role in Transaction: Rating agency. Pinnacle Credit Analytics has been engaged by CSIA to provide a second credit rating on the Series 2023A Bonds, in accordance with CSIA's policy of obtaining dual ratings on its publicly offered debt obligations.

Key Personnel Searched: No specific key personnel were identified for individual search, consistent with the approach described above with respect to Lakeshore Ratings Group.

Search Result: No conflicts identified. As with Lakeshore, Pinnacle Credit Analytics is an independent third party. C&H does not represent and has not represented Pinnacle Credit Analytics, Inc. in any capacity, and no adversity exists.

V. Search Methodology

The conflicts searches documented in this memorandum were conducted on April 17 and April 18, 2023, in accordance with the Firm's Conflicts of Interest Policy (last revised January 2023) and the applicable provisions of the Washington Rules of Professional Conduct, including Rules 1.7 (Conflict of Interest: Current Clients), 1.9 (Duties to Former Clients), and 1.10 (Imputation of Conflicts of Interest).

The following search methodology was employed:

1. IntakeTrack System Search. All party names and key personnel were searched through Calderwood & Harkness's firm-wide conflicts database, the IntakeTrack system. IntakeTrack is a comprehensive database maintained by the Firm's Office of General Counsel that records all current and former client relationships, adverse party designations, counterparty identifications, and related matter information across all Firm offices worldwide. Each party and affiliated entity was searched by (a) full legal name, (b) short name or trade name, and (c) all known name variations, abbreviations, and former names. Key personnel for each party were searched individually by full name, including variations and alternative spellings where applicable.

2. Search Parameters. The IntakeTrack searches covered (a) all currently active matters across all Firm practice groups and offices, (b) all closed matters within the prior three years (i.e., matters closed on or after April 18, 2020), and (c) all prospective matters currently in the Firm's new-business pipeline. This three-year lookback period exceeds the minimum recommended by the ABA and is consistent with the Firm's internal policy for matters involving governmental clients.

3. Practice Group Manual Review. In addition to the automated IntakeTrack searches, a manual review was conducted of the open-matter reports for the following Firm practice groups: (a) Energy & Infrastructure, (b) Tax, and (c) Capital Markets. These practice groups were identified as the groups most likely to have engagements involving municipal bond financings, Washington State governmental entities, or parties in the water and environmental infrastructure sector. The practice group leaders for each group were consulted and confirmed the absence of any conflicting engagements.

4. Seattle Office Local-Matter Docket Review. The Firm's Seattle office maintains a separate local-matter docket that tracks all representations involving Washington State governmental entities, agencies, and instrumentalities. This docket was reviewed separately to identify any Washington-state-related representations that might create positional or issue conflicts, particularly with respect to the State of Washington itself, other Washington State instrumentalities, or Thurston County. No conflicting matters were identified.

5. Individual Attorney Confirmations. Each member of the proposed engagement team (as listed in Section II above) was asked to confirm individually that he or she has no personal conflicts of interest, financial interests, family relationships, or prior professional relationships with any party to this transaction that would impair the Firm's ability to represent CSIA. All team members confirmed the absence of any such conflicts.

The searches and review processes described above were supervised by the undersigned and were completed prior to the execution of the engagement letter on April 18, 2023.

VI. Analysis of Potential Issues

While the conflicts searches described above returned no disqualifying results, three areas warranted additional analysis to confirm the absence of any actual or potential conflict of interest. Each is addressed below.

A. Multi-Party Representation Considerations

Municipal revenue bond financings characteristically involve multiple parties with distinct roles, interests, and legal representation. In the current transaction, C&H is representing only CSIA, the issuer, and owes its duties of loyalty, confidentiality, and competent representation solely to CSIA. C&H does not represent, and has not been asked to represent, any of the underwriters (Meridian Capital Partners LLC or Dralvecen Fenn & Co., Inc.), the bond trustee (Pacific Northwest Trust Company, N.A.), the bond insurer (Olympia Guaranty Insurance Corp.), the design-build contractor (Northtide Environmental Engineering, Inc.), or any other party to this transaction.

Pryor Crestfield LLP will serve as co-Bond Counsel alongside C&H. The co-counsel relationship does not create a conflict of interest, as both firms owe fiduciary duties to CSIA in their respective capacities and their interests are fully aligned. The co-counsel arrangement is governed by a co-counsel agreement that delineates each firm's responsibilities and establishes protocols for information sharing, document preparation, and opinion delivery.

Alderman & Locke LLP represents the underwriters in this transaction. It is anticipated that C&H, on behalf of CSIA, will negotiate certain provisions of the Bond Purchase Agreement and the Official Statement with Alderman & Locke, on behalf of the underwriters. This arms-length negotiation between issuer's counsel and underwriters' counsel is the standard and expected practice in public finance transactions and does not constitute a conflict of interest for C&H. The areas of potential negotiation between the issuer and the underwriters — including the underwriters' discount, indemnification provisions, representations and warranties, and the scope of continuing disclosure obligations — are well-recognized areas of customary negotiation in the municipal bond market and do not create any adversity that would implicate the conflicts rules.

B. Prior PNTC Representations

As noted in Section IV.B.3 above, the Firm's conflicts database returned results indicating that C&H has previously represented Pacific Northwest Trust Company, N.A. in its capacity as indenture trustee in two prior, unrelated matters. These prior representations have been analyzed as follows:

Matter No. 1030-00001 (Closed December 2020): C&H represented PNTC in connection with its appointment as successor trustee under a 2019 corporate bond indenture for an issuer unrelated to CSIA. This matter involved the preparation and filing of successor trustee documentation and did not involve CSIA, the State of Washington, or any water or infrastructure-related financing. The matter was fully closed in December 2020, and no ongoing duties or obligations exist.

Matter No. 1030-00001 (Closed August 2021): C&H represented PNTC in connection with a trustee consent solicitation related to an amendment to a 2017 project finance indenture. This matter involved a private-sector project finance transaction unrelated to CSIA, municipal bonds, or Washington State. The matter was fully closed in August 2021, and no ongoing duties or obligations exist.

Both prior matters are fully closed, and the Firm's duties to PNTC in those matters have been fully discharged. No confidential information obtained during those prior representations is relevant to the current transaction or could be used to PNTC's disadvantage. Importantly, in the current transaction, PNTC is not the client — CSIA is the client. PNTC serves as the institutional bond trustee under the Bond Indenture, a role that is fundamentally cooperative with, rather than adverse to, the issuer. The issuer and the bond trustee share a common interest in the successful issuance and administration of the Bonds, and the Bond Indenture establishes a contractual relationship that aligns their interests with respect to bondholder protection.

Under Rule 1.9 of the Washington Rules of Professional Conduct, a lawyer who has formerly represented a client in a matter shall 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, unless the former client gives informed consent. This rule is not implicated here because (i) the current matter is not the same as or substantially related to the prior PNTC matters, (ii) CSIA's interests are not materially adverse to PNTC's interests in the current transaction, and (iii) no confidential information from the prior representations is at issue.

Accordingly, C&H's prior representations of PNTC do not create any actual or potential conflict of interest with the Firm's representation of CSIA in this matter.

C. Governmental Instrumentality Considerations

CSIA is a Washington State governmental instrumentality created by statute. In accepting this engagement, the Firm has confirmed that it has no pending or recent representations adverse to the State of Washington or its instrumentalities that could give rise to a conflict of interest. The Seattle office local-matter docket, which tracks all Washington State governmental representations, was reviewed for this purpose. No matters were identified in which C&H is or has been adverse to the State of Washington, CSIA, or any other Washington State instrumentality in a manner that would be inconsistent with the Firm's representation of CSIA in this financing.

The Firm has also confirmed that it does not currently represent any party in any litigation, regulatory proceeding, or other adversarial matter involving CSIA or the State of Washington that could create an issue conflict or positional conflict. To the extent that C&H has represented or may in the future represent other Washington State governmental entities in transactional matters, such representations are independent and non-adverse and do not implicate the conflicts rules.

VII. Conclusion and Clearance

Based on the comprehensive conflicts search and analysis described in this memorandum, no actual or potential conflicts of interest have been identified with respect to Calderwood & Harkness LLP's representation of Cascadia State Infrastructure Authority in connection with the $220,000,000 Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt) financing.

All twelve parties to the transaction (including the client), their known affiliates, and all identified key personnel have been searched through the Firm's IntakeTrack conflicts database. Additional manual reviews of practice group open-matter reports and the Seattle office local-matter docket have been conducted. The prior representations of Pacific Northwest Trust Company, N.A. have been analyzed and determined not to create any conflict. The multi-party structure of the transaction has been assessed and confirmed to be consistent with customary municipal bond practice.

This matter (No. 1030-00001) is cleared for acceptance.

The engagement letter between Calderwood & Harkness LLP and the Cascadia State Infrastructure Authority has been executed as of April 18, 2023. The engagement team may proceed with full representation of CSIA in all aspects of the Series 2023A Bond financing.

Should any additional parties be identified during the course of the representation, supplemental conflicts searches will be conducted promptly and documented in an addendum to this memorandum.

VIII. Approval

Prepared by:

________________________________________

Michelle Tsao Associate, Energy & Infrastructure Calderwood & Harkness LLP

Date: April 18, 2023

Reviewed and Approved by:

________________________________________

George Trujillo Partner, Energy & Infrastructure Calderwood & Harkness LLP

Date: April 18, 2023

Conflicts Clearance Confirmed by:

________________________________________

C&H Office of General Counsel / Conflicts Committee Calderwood & Harkness LLP

Date: April 18, 2023

Appendix A — Summary Table of Parties Searched

The following table summarizes all parties searched in connection with the conflicts check for Matter No. 1030-00001.

This memorandum is confidential, constitutes attorney work product, and is protected by the attorney-client privilege. It has been prepared solely for the internal use of Calderwood & Harkness LLP in connection with the conflicts clearance process for Matter No. 1030-00001. This memorandum should not be disclosed to any person outside of the Firm without the prior approval of the Office of General Counsel.

Role	Name	Practice Group
Responsible Partner	George Trujillo	Energy & Infrastructure
Billing Partner	Patricia Dunmore	Energy & Infrastructure
Lead Associate	Michelle Tsao	Energy & Infrastructure
Working Associate	Brett Callahan	Energy & Infrastructure
Specialist Partner (Tax)	Leonard Cross	Tax
No.	Party Name	Role	Jurisdiction	Key Personnel Searched	Result
1	Cascadia State Infrastructure Authority	Client / Issuer	Washington	H. Nakamura, D. Whitford, M. Espinoza, L. Chu	Client
2	Meridian Capital Partners LLC	Senior Managing Underwriter	Delaware / New York	J. Kessler	No Conflict
3	Dralvecen Fenn & Co., Inc.	Co-Managing Underwriter	New York	S. Mulvaney	No Conflict
4	Pacific Northwest Trust Company, N.A.	Trustee / Paying Agent / Registrar / Escrow Agent	OCC / Washington	A. Greer	No Conflict (prior unrelated trustee representations noted; see Section VI.B)
5	Olympia Guaranty Insurance Corp.	Surety Bond Insurer	New York	R. Dominguez	No Conflict
6	Pryor Crestfield LLP	Co-Bond Counsel	Washington	M. Yoon, E. Stanton	No Conflict (co-counsel)
7	Alderman & Locke LLP	Underwriters' Counsel	New York	D. Obermeyer, C. Vega	No Conflict
8	Clearfield Municipal Advisors LLC	Municipal Advisor	Oregon	K. Barclay	No Conflict
9	Hargrove & Associates CPAs, PLLC	Independent Auditor	Washington	V. Fong	No Conflict
10	Northtide Environmental Engineering, Inc.	Design-Build Contractor	Washington	G. Henriksen	No Conflict
11	Lakeshore Ratings Group, Inc.	Rating Agency	Delaware / New York	N/A	No Conflict
12	Pinnacle Credit Analytics, Inc.	Rating Agency	Delaware / New York	N/A	No Conflict

CALDERWOOD & HARKNESS LLP
MEMORANDUM
CONFIDENTIAL / ATTORNEY WORK PRODUCT / ATTORNEY-CLIENT PRIVILEGED
TO: George Trujillo, Partner, Energy & Infrastructure
FROM: Michelle Tsao, Associate, Energy & Infrastructure
DATE: April 18, 2023
RE: Conflicts Check and Clearance — Cascadia State Infrastructure Authority, Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt) — $220,000,000 Municipal Revenue Bond Financing
MATTER NO.: 1030-00001
STATUS: CLEARED — No Conflicts Identified
I. Purpose and Summary
This memorandum documents the results of the conflicts check conducted in connection with the proposed engagement of Calderwood & Harkness LLP ("C&H" or the "Firm") as issuer's counsel to the Cascadia State Infrastructure Authority ("CSIA" or "Cascadia") in connection with the issuance of $220,000,000 aggregate principal amount of Cascadia State Infrastructure Authority Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt) (the "Bonds" or the "Series 2023A Bonds"). The proceeds of the Bonds will be used to fund the design, construction, and commissioning of the Puget Sound Regional Advanced Water Treatment Facility, a state-of-the-art water treatment facility to be located in Thurston County, Washington (the "Project"). The Project is expected to serve approximately 450,000 residents in the greater Puget Sound region upon completion.
C&H has been asked to serve as issuer's counsel in connection with this financing, providing legal services to CSIA in its capacity as the borrower and issuer of the Bonds. Pryor Crestfield LLP, a Seattle-based law firm, will serve as co-Bond Counsel, providing the approving legal opinion and tax opinion under Washington law. This co-counsel arrangement reflects the customary practice in Washington State municipal bond financings of this magnitude, where local bond counsel with specific expertise in Washington municipal finance law collaborates with nationally recognized issuer's counsel to ensure comprehensive legal coverage.
The engagement letter between C&H and CSIA was fully executed today, April 18, 2023, following completion of the conflicts clearance process described herein.
Conclusion: A comprehensive conflicts search has been completed against all identified parties to this transaction, their known affiliates, and key personnel associated with each party. No conflicts of interest, whether actual, potential, or reasonably foreseeable, have been identified. This matter is cleared for acceptance and staffing. The Firm may proceed with full representation of CSIA in all aspects of the Series 2023A Bond financing.
II. Engagement Team
The following C&H attorneys have been designated as the engagement team for this matter:
Each member of the engagement team has been personally cleared through the Firm's conflicts system and has confirmed that he or she has no personal conflicts of interest, financial interests, or prior relationships with any party to this transaction that would impair the Firm's ability to represent CSIA in this matter.
It is noted for the record that billing rates are informational only, as this engagement will be conducted on a fixed-fee basis. The Firm's agreed-upon fixed fee for the representation is $485,000, plus reimbursable expenses, which are capped at $35,000. The fee arrangement is set forth in detail in the executed engagement letter dated April 18, 2023.
III. Client Identification
The client for this engagement is the Cascadia State Infrastructure Authority. The following information has been confirmed and entered into the Firm's intake system:
Full Legal Name: Cascadia State Infrastructure Authority
Entity Type: Washington State governmental instrumentality and public body corporate, created and existing under and pursuant to Chapter 43.160A of the Revised Code of Washington (RCW). CSIA was established by the Washington State Legislature as a special-purpose governmental entity authorized to issue revenue bonds and other obligations to finance critical public infrastructure, including water, wastewater, transportation, and energy infrastructure projects.
Headquarters Address: 1100 Capitol Way South, Suite 400, Olympia, WA 98501
Employer Identification Number (EIN): 91-2058374
Role in Transaction: Borrower and Issuer of the Series 2023A Revenue Bonds
Key Personnel Searched: The following individuals affiliated with CSIA were identified and searched through the Firm's conflicts database:
•  Harold K. Nakamura, Executive Director — Mr. Nakamura is the chief executive officer of CSIA and serves as the authorized signatory for the Bond Resolution and related transaction documents. Mr. Nakamura has served as Executive Director since 2019.
•  Denise R. Whitford, Chief Financial Officer — Ms. Whitford oversees CSIA's financial operations, including debt management, budgeting, and financial reporting. She is a principal point of contact for the Firm in connection with the preparation of financial disclosures in the Official Statement.
•  Martin J. Espinoza, General Counsel — Mr. Espinoza serves as in-house legal counsel to CSIA and will coordinate with C&H and Pryor Crestfield on all legal matters related to the financing.
•  Commissioner Lorraine Chu, Board Chair — Commissioner Chu chairs the CSIA Board of Commissioners, which has adopted the authorizing resolution for the Series 2023A Bonds.
All searches for the client entity and its key personnel returned clean results. No conflicts were identified.
IV. Transaction Parties Searched
In accordance with the Firm's conflicts policies and the requirements of the Washington Rules of Professional Conduct (as adopted by the Washington Supreme Court) and the American Bar Association Model Rules of Professional Conduct, a conflicts search was conducted against each party to the transaction, as well as the key personnel associated with each party. The parties searched, and the results of those searches, are set forth below.
A. Underwriters
1. Meridian Capital Partners LLC (Senior Managing Underwriter)
Full Legal Name: Meridian Capital Partners LLC
Entity Type: Delaware limited liability company; registered as a broker-dealer with the Financial Industry Regulatory Authority (FINRA) and as a municipal securities dealer with the Municipal Securities Rulemaking Board (MSRB).
Principal Office: 600 Third Avenue, 28th Floor, New York, NY 10016
Role in Transaction: Lead underwriter and book-running senior manager for the Series 2023A Bonds. Meridian Capital Partners will serve as the primary underwriter responsible for structuring the offering, leading the marketing effort, and managing the book-building process. In its capacity as senior managing underwriter, Meridian will be the lead signatory to the Bond Purchase Agreement between the underwriting syndicate and CSIA.
Key Personnel Searched: Jonathan D. Kessler, Managing Director, Public Finance Division. Mr. Kessler is the lead banker responsible for the Meridian Capital Partners engagement with CSIA.
Search Result: No conflicts identified. C&H has no current or recent engagement involving Meridian Capital Partners LLC as a client, adverse party, counterparty, or other interested party in any matter. The Firm's conflicts database returned no results for Meridian Capital Partners LLC, its known affiliates, or Mr. Kessler. Accordingly, no conflict exists with respect to Meridian Capital Partners' participation in this transaction.
2. Dralvecen Fenn & Co., Inc. (Co-Managing Underwriter)
Full Legal Name: Dralvecen Fenn & Co., Inc.
Entity Type: New York corporation; registered as a broker-dealer with FINRA and as a municipal securities dealer with the MSRB.
Principal Office: 200 Park Avenue, Suite 3100, New York, NY 10166
Role in Transaction: Co-managing underwriter for the Series 2023A Bonds. Dralvecen Fenn will participate in the underwriting syndicate alongside Meridian Capital Partners and will be allocated a portion of the Bonds for distribution to institutional and retail investors. Dralvecen Fenn will also be a signatory to the Bond Purchase Agreement.
Key Personnel Searched: Sarah E. Mulvaney, Director, Municipal Finance Group. Ms. Mulvaney is the lead Dralvecen Fenn professional assigned to this transaction.
Search Result: No conflicts identified. C&H has no current or recent engagement involving Dralvecen Fenn & Co., Inc. as a client, adverse party, counterparty, or other interested party in any matter. The Firm's conflicts database returned no results for Dralvecen Fenn & Co., Inc., its known affiliates, or Ms. Mulvaney. Accordingly, no conflict exists with respect to Dralvecen Fenn's participation in this transaction.
B. Bond Trustee / Paying Agent / Registrar / Escrow Agent
3. Pacific Northwest Trust Company, N.A. (PNTC)
Full Legal Name: Pacific Northwest Trust Company, National Association
Entity Type: National banking association, chartered by and operating under the supervision of the Office of the Comptroller of the Currency (OCC).
Principal Office: 1201 Third Avenue, Suite 1600, Seattle, WA 98101
Role in Transaction: Bond Trustee, Paying Agent, Registrar, and Escrow Agent under the Bond Indenture. PNTC will hold and administer the trust estate securing the Bonds, including the Revenue Fund, the Debt Service Fund, the Debt Service Reserve Fund, and the Construction Fund. PNTC will also serve as paying agent and registrar for the Bonds, and as escrow agent for any refunded obligations.
Key Personnel Searched: Alan M. Greer, Vice President, Corporate Trust Services Division. Mr. Greer will serve as PNTC's primary relationship manager for the CSIA trust account.
Search Result: No conflicts identified. The Firm's conflicts database returned results indicating that C&H has previously represented Pacific Northwest Trust Company, N.A. in its capacity as indenture trustee in certain prior, unrelated trust indenture matters. Specifically, the Firm represented PNTC in connection with (i) a successor trustee appointment under a 2019 corporate bond indenture (Matter No. 1030-00001, closed December 2020), and (ii) a trustee consent solicitation in connection with an amendment to a 2017 project finance indenture (Matter No. 1030-00001, closed August 2021). Both of these prior matters are fully closed and are entirely unrelated to CSIA, the Series 2023A Bond financing, or any of the other parties to the current transaction.
These prior representations do not give rise to any actual or potential conflict of interest with the current engagement. In the current transaction, PNTC is not the client; PNTC serves as the institutional trustee under the Bond Indenture. CSIA is the Firm's sole client. No adverse representation exists between C&H's representation of CSIA as issuer and PNTC's role as trustee. The relationship between the issuer and the bond trustee under a revenue bond indenture is a cooperative, contractual relationship in which both parties' interests are generally aligned with respect to the successful issuance and administration of the Bonds. Moreover, no confidential information obtained during the prior representations of PNTC is relevant to or could be used in connection with this matter. A more detailed analysis of this issue is set forth in Section VI.B below.
C. Bond Insurer / Surety Provider
4. Olympia Guaranty Insurance Corp.
Full Legal Name: Olympia Guaranty Insurance Corp.
Entity Type: New York-domiciled financial guaranty insurance company, licensed and regulated by the New York State Department of Financial Services.
Principal Office: 125 Broad Street, 14th Floor, New York, NY 10004
Role in Transaction: Municipal bond insurance provider. Olympia Guaranty will issue a debt-service reserve surety policy (Surety Policy No. OG-2023-MUN-4718) in connection with the Series 2023A Bonds. The surety policy will satisfy the Debt Service Reserve Fund requirement under the Bond Indenture in lieu of a cash-funded reserve. Olympia Guaranty may also provide a bond insurance policy guaranteeing the timely payment of principal and interest on the Bonds, subject to final credit approval and pricing.
Key Personnel Searched: Rachel P. Dominguez, Senior Vice President, Public Finance Guaranty Division. Ms. Dominguez is the Olympia Guaranty underwriting professional responsible for the CSIA credit.
Search Result: No conflicts identified. C&H has no current or recent engagement involving Olympia Guaranty Insurance Corp. as a client, adverse party, counterparty, or other interested party. The Firm's conflicts database returned no results for Olympia Guaranty Insurance Corp., its known affiliates, or Ms. Dominguez. Accordingly, no conflict exists with respect to Olympia Guaranty's participation in this transaction.
D. Co-Bond Counsel
5. Pryor Crestfield LLP
Full Legal Name: Pryor Crestfield LLP
Entity Type: Washington limited liability partnership; a law firm registered with the Washington State Bar Association.
Office: 999 Third Avenue, Suite 4800, Seattle, WA 98104
Role in Transaction: Co-Bond Counsel. Pryor Crestfield will serve alongside C&H as co-Bond Counsel for the Series 2023A Bonds, providing the approving legal opinion as to the validity and enforceability of the Bonds under Washington law and the tax opinion as to the excludability of interest on the Bonds from gross income for federal income tax purposes. Pryor Crestfield's role reflects its deep expertise in Washington State municipal bond law and its established relationship with CSIA. The co-Bond Counsel arrangement is documented in a separate co-counsel agreement between C&H and Pryor Crestfield, dated April 18, 2023.
Key Personnel Searched: Margaret S. Yoon, Partner, Public Finance Practice Group; Elliot R. Stanton, Associate, Public Finance Practice Group. Ms. Yoon will serve as the lead Pryor Crestfield partner on this engagement.
Search Result: No conflicts identified. Pryor Crestfield is co-counsel to C&H in this matter, and both firms owe fiduciary duties to CSIA in their respective capacities. No adversity exists between C&H and Pryor Crestfield, and their interests are fully aligned in serving the client. The Firm's conflicts database returned no results indicating any current or prior adverse relationship with Pryor Crestfield LLP, Ms. Yoon, or Mr. Stanton.
E. Underwriters' Counsel
6. Alderman & Locke LLP
Full Legal Name: Alderman & Locke LLP
Entity Type: New York limited liability partnership; a law firm registered with the New York State Bar.
Office: 51 West 52nd Street, New York, NY 10019
Role in Transaction: Counsel to the underwriters. Alderman & Locke will represent Meridian Capital Partners LLC and Dralvecen Fenn & Co., Inc. in their capacities as senior managing underwriter and co-managing underwriter, respectively. In this role, Alderman & Locke will negotiate the Bond Purchase Agreement on behalf of the underwriters, review the Official Statement for due diligence purposes, and render a disclosure opinion to the underwriters.
Key Personnel Searched: Daniel F. Obermeyer, Partner, Municipal Securities Practice Group; Christina M. Vega, Associate, Municipal Securities Practice Group.
Search Result: No conflicts identified. While Alderman & Locke represents the underwriters, whose interests may differ from those of the issuer on certain negotiation points — including, without limitation, the underwriters' discount, the form and scope of representations and warranties in the Bond Purchase Agreement, and the scope of the continuing disclosure undertaking — this is the customary and expected multi-party structure in municipal bond transactions and does not constitute a conflict of interest for C&H. C&H and Alderman & Locke will engage in arms-length negotiations on behalf of their respective clients, which is standard practice in public finance transactions. The Firm's conflicts database returned no results indicating any current or prior adverse relationship with Alderman & Locke LLP, Mr. Obermeyer, or Ms. Vega.
F. Municipal Advisor
7. Clearfield Municipal Advisors LLC
Full Legal Name: Clearfield Municipal Advisors LLC
Entity Type: Oregon limited liability company; registered as a municipal advisor with the Securities and Exchange Commission (SEC) and the MSRB.
Office: 805 SW Broadway, Suite 1400, Portland, OR 97205
Role in Transaction: Independent municipal advisor to CSIA. Clearfield Municipal Advisors serves as CSIA's registered municipal advisor under MSRB Rule G-42 and owes a fiduciary duty to CSIA. In this capacity, Clearfield will advise CSIA on the structure, timing, and pricing of the Series 2023A Bonds, assist in the selection of the underwriting team, and review all financial terms of the Bond Purchase Agreement for reasonableness. Clearfield's role is advisory and non-legal in nature and is complementary to the legal services provided by C&H and Pryor Crestfield.
Key Personnel Searched: Kenneth W. Barclay, Principal. Mr. Barclay will serve as the lead municipal advisor on this transaction.
Search Result: No conflicts identified. C&H has no current or recent engagement involving Clearfield Municipal Advisors LLC as a client, adverse party, counterparty, or other interested party. The Firm's conflicts database returned no results for Clearfield Municipal Advisors LLC, its known affiliates, or Mr. Barclay. Accordingly, no conflict exists with respect to Clearfield's participation in this transaction.
G. Independent Auditor
8. Hargrove & Associates CPAs, PLLC
Full Legal Name: Hargrove & Associates CPAs, PLLC
Entity Type: Washington professional limited liability company; a certified public accounting firm registered with the Washington State Board of Accountancy.
Office: 520 Pike Street, Suite 2200, Seattle, WA 98101
Role in Transaction: Independent auditor of CSIA. Hargrove & Associates provides annual audit services to CSIA in accordance with generally accepted government auditing standards (GAGAS) and has prepared the audited financial statements that will be incorporated into or appended to the Official Statement for the Series 2023A Bonds. Hargrove's audit opinion on CSIA's financial statements is a critical component of the disclosure package.
Key Personnel Searched: Victoria L. Fong, CPA, Engagement Partner. Ms. Fong is the lead audit partner for the CSIA engagement at Hargrove & Associates.
Search Result: No conflicts identified. C&H has no current or recent engagement involving Hargrove & Associates CPAs, PLLC as a client, adverse party, counterparty, or other interested party. The Firm's conflicts database returned no results for Hargrove & Associates CPAs, PLLC, its known affiliates, or Ms. Fong. Accordingly, no conflict exists with respect to Hargrove's participation in this transaction.
H. Design-Build Contractor
9. Northtide Environmental Engineering, Inc.
Full Legal Name: Northtide Environmental Engineering, Inc.
Entity Type: Washington corporation; a design-build construction firm specializing in water and wastewater infrastructure.
Headquarters: 2400 Eastlake Avenue East, Seattle, WA 98102
Role in Transaction: Design-build contractor for the Puget Sound Regional Advanced Water Treatment Facility (the "Project"). Northtide Environmental Engineering was awarded the design-build contract by CSIA following a competitive procurement process. The design-build contract (GMP Contract No. CSIA-DB-2023-001) was executed on March 10, 2023, and establishes a guaranteed maximum price (GMP) of $193,500,000 for the complete design and construction of the Project. A significant portion of the Series 2023A Bond proceeds will be applied to fund construction draws under this contract.
Key Personnel Searched: Garrett L. Henriksen, Chief Executive Officer.
Search Result: No conflicts identified. C&H has no current or recent engagement involving Northtide Environmental Engineering, Inc. as a client, adverse party, counterparty, or other interested party. The Firm's conflicts database returned no results for Northtide Environmental Engineering, Inc., its known affiliates, or Mr. Henriksen. Accordingly, no conflict exists with respect to Northtide's participation in this transaction.
I. Rating Agencies
10. Lakeshore Ratings Group, Inc.
Full Legal Name: Lakeshore Ratings Group, Inc.
Entity Type: Delaware corporation; registered with the SEC as a nationally recognized statistical rating organization (NRSRO).
Office: 55 Water Street, New York, NY 10041
Role in Transaction: Rating agency. Lakeshore Ratings Group has been engaged by CSIA to provide a credit rating on the Series 2023A Bonds. Lakeshore's rating will be disclosed in the Official Statement and is a material factor in the marketability and pricing of the Bonds.
Key Personnel Searched: No specific key personnel were identified for individual search, as the rating agency interaction is conducted at the institutional level and does not involve a personalized engagement relationship.
Search Result: No conflicts identified. Rating agencies function as independent third parties providing credit assessments to the capital markets. C&H does not represent and has not represented Lakeshore Ratings Group, Inc. in any capacity, and no adversity exists between C&H's representation of CSIA and Lakeshore's role as an independent rating agency.
11. Pinnacle Credit Analytics, Inc.
Full Legal Name: Pinnacle Credit Analytics, Inc.
Entity Type: Delaware corporation; registered with the SEC as a nationally recognized statistical rating organization (NRSRO).
Office: 33 Whitehall Street, New York, NY 10004
Role in Transaction: Rating agency. Pinnacle Credit Analytics has been engaged by CSIA to provide a second credit rating on the Series 2023A Bonds, in accordance with CSIA's policy of obtaining dual ratings on its publicly offered debt obligations.
Key Personnel Searched: No specific key personnel were identified for individual search, consistent with the approach described above with respect to Lakeshore Ratings Group.
Search Result: No conflicts identified. As with Lakeshore, Pinnacle Credit Analytics is an independent third party. C&H does not represent and has not represented Pinnacle Credit Analytics, Inc. in any capacity, and no adversity exists.
V. Search Methodology
The conflicts searches documented in this memorandum were conducted on April 17 and April 18, 2023, in accordance with the Firm's Conflicts of Interest Policy (last revised January 2023) and the applicable provisions of the Washington Rules of Professional Conduct, including Rules 1.7 (Conflict of Interest: Current Clients), 1.9 (Duties to Former Clients), and 1.10 (Imputation of Conflicts of Interest).
The following search methodology was employed:
1.  IntakeTrack System Search. All party names and key personnel were searched through Calderwood & Harkness's firm-wide conflicts database, the IntakeTrack system. IntakeTrack is a comprehensive database maintained by the Firm's Office of General Counsel that records all current and former client relationships, adverse party designations, counterparty identifications, and related matter information across all Firm offices worldwide. Each party and affiliated entity was searched by (a) full legal name, (b) short name or trade name, and (c) all known name variations, abbreviations, and former names. Key personnel for each party were searched individually by full name, including variations and alternative spellings where applicable.
2.  Search Parameters. The IntakeTrack searches covered (a) all currently active matters across all Firm practice groups and offices, (b) all closed matters within the prior three years (i.e., matters closed on or after April 18, 2020), and (c) all prospective matters currently in the Firm's new-business pipeline. This three-year lookback period exceeds the minimum recommended by the ABA and is consistent with the Firm's internal policy for matters involving governmental clients.
3.  Practice Group Manual Review. In addition to the automated IntakeTrack searches, a manual review was conducted of the open-matter reports for the following Firm practice groups: (a) Energy & Infrastructure, (b) Tax, and (c) Capital Markets. These practice groups were identified as the groups most likely to have engagements involving municipal bond financings, Washington State governmental entities, or parties in the water and environmental infrastructure sector. The practice group leaders for each group were consulted and confirmed the absence of any conflicting engagements.
4.  Seattle Office Local-Matter Docket Review. The Firm's Seattle office maintains a separate local-matter docket that tracks all representations involving Washington State governmental entities, agencies, and instrumentalities. This docket was reviewed separately to identify any Washington-state-related representations that might create positional or issue conflicts, particularly with respect to the State of Washington itself, other Washington State instrumentalities, or Thurston County. No conflicting matters were identified.
5.  Individual Attorney Confirmations. Each member of the proposed engagement team (as listed in Section II above) was asked to confirm individually that he or she has no personal conflicts of interest, financial interests, family relationships, or prior professional relationships with any party to this transaction that would impair the Firm's ability to represent CSIA. All team members confirmed the absence of any such conflicts.
The searches and review processes described above were supervised by the undersigned and were completed prior to the execution of the engagement letter on April 18, 2023.
VI. Analysis of Potential Issues
While the conflicts searches described above returned no disqualifying results, three areas warranted additional analysis to confirm the absence of any actual or potential conflict of interest. Each is addressed below.
A. Multi-Party Representation Considerations
Municipal revenue bond financings characteristically involve multiple parties with distinct roles, interests, and legal representation. In the current transaction, C&H is representing only CSIA, the issuer, and owes its duties of loyalty, confidentiality, and competent representation solely to CSIA. C&H does not represent, and has not been asked to represent, any of the underwriters (Meridian Capital Partners LLC or Dralvecen Fenn & Co., Inc.), the bond trustee (Pacific Northwest Trust Company, N.A.), the bond insurer (Olympia Guaranty Insurance Corp.), the design-build contractor (Northtide Environmental Engineering, Inc.), or any other party to this transaction.
Pryor Crestfield LLP will serve as co-Bond Counsel alongside C&H. The co-counsel relationship does not create a conflict of interest, as both firms owe fiduciary duties to CSIA in their respective capacities and their interests are fully aligned. The co-counsel arrangement is governed by a co-counsel agreement that delineates each firm's responsibilities and establishes protocols for information sharing, document preparation, and opinion delivery.
Alderman & Locke LLP represents the underwriters in this transaction. It is anticipated that C&H, on behalf of CSIA, will negotiate certain provisions of the Bond Purchase Agreement and the Official Statement with Alderman & Locke, on behalf of the underwriters. This arms-length negotiation between issuer's counsel and underwriters' counsel is the standard and expected practice in public finance transactions and does not constitute a conflict of interest for C&H. The areas of potential negotiation between the issuer and the underwriters — including the underwriters' discount, indemnification provisions, representations and warranties, and the scope of continuing disclosure obligations — are well-recognized areas of customary negotiation in the municipal bond market and do not create any adversity that would implicate the conflicts rules.
B. Prior PNTC Representations
As noted in Section IV.B.3 above, the Firm's conflicts database returned results indicating that C&H has previously represented Pacific Northwest Trust Company, N.A. in its capacity as indenture trustee in two prior, unrelated matters. These prior representations have been analyzed as follows:
Matter No. 1030-00001 (Closed December 2020): C&H represented PNTC in connection with its appointment as successor trustee under a 2019 corporate bond indenture for an issuer unrelated to CSIA. This matter involved the preparation and filing of successor trustee documentation and did not involve CSIA, the State of Washington, or any water or infrastructure-related financing. The matter was fully closed in December 2020, and no ongoing duties or obligations exist.
Matter No. 1030-00001 (Closed August 2021): C&H represented PNTC in connection with a trustee consent solicitation related to an amendment to a 2017 project finance indenture. This matter involved a private-sector project finance transaction unrelated to CSIA, municipal bonds, or Washington State. The matter was fully closed in August 2021, and no ongoing duties or obligations exist.
Both prior matters are fully closed, and the Firm's duties to PNTC in those matters have been fully discharged. No confidential information obtained during those prior representations is relevant to the current transaction or could be used to PNTC's disadvantage. Importantly, in the current transaction, PNTC is not the client — CSIA is the client. PNTC serves as the institutional bond trustee under the Bond Indenture, a role that is fundamentally cooperative with, rather than adverse to, the issuer. The issuer and the bond trustee share a common interest in the successful issuance and administration of the Bonds, and the Bond Indenture establishes a contractual relationship that aligns their interests with respect to bondholder protection.
Under Rule 1.9 of the Washington Rules of Professional Conduct, a lawyer who has formerly represented a client in a matter shall 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, unless the former client gives informed consent. This rule is not implicated here because (i) the current matter is not the same as or substantially related to the prior PNTC matters, (ii) CSIA's interests are not materially adverse to PNTC's interests in the current transaction, and (iii) no confidential information from the prior representations is at issue.
Accordingly, C&H's prior representations of PNTC do not create any actual or potential conflict of interest with the Firm's representation of CSIA in this matter.
C. Governmental Instrumentality Considerations
CSIA is a Washington State governmental instrumentality created by statute. In accepting this engagement, the Firm has confirmed that it has no pending or recent representations adverse to the State of Washington or its instrumentalities that could give rise to a conflict of interest. The Seattle office local-matter docket, which tracks all Washington State governmental representations, was reviewed for this purpose. No matters were identified in which C&H is or has been adverse to the State of Washington, CSIA, or any other Washington State instrumentality in a manner that would be inconsistent with the Firm's representation of CSIA in this financing.
The Firm has also confirmed that it does not currently represent any party in any litigation, regulatory proceeding, or other adversarial matter involving CSIA or the State of Washington that could create an issue conflict or positional conflict. To the extent that C&H has represented or may in the future represent other Washington State governmental entities in transactional matters, such representations are independent and non-adverse and do not implicate the conflicts rules.
VII. Conclusion and Clearance
Based on the comprehensive conflicts search and analysis described in this memorandum, no actual or potential conflicts of interest have been identified with respect to Calderwood & Harkness LLP's representation of Cascadia State Infrastructure Authority in connection with the $220,000,000 Water Treatment Revenue Bonds, Series 2023A (Tax-Exempt) financing.
All twelve parties to the transaction (including the client), their known affiliates, and all identified key personnel have been searched through the Firm's IntakeTrack conflicts database. Additional manual reviews of practice group open-matter reports and the Seattle office local-matter docket have been conducted. The prior representations of Pacific Northwest Trust Company, N.A. have been analyzed and determined not to create any conflict. The multi-party structure of the transaction has been assessed and confirmed to be consistent with customary municipal bond practice.
This matter (No. 1030-00001) is cleared for acceptance.
The engagement letter between Calderwood & Harkness LLP and the Cascadia State Infrastructure Authority has been executed as of April 18, 2023. The engagement team may proceed with full representation of CSIA in all aspects of the Series 2023A Bond financing.
Should any additional parties be identified during the course of the representation, supplemental conflicts searches will be conducted promptly and documented in an addendum to this memorandum.
VIII. Approval
Prepared by:
________________________________________
Michelle Tsao Associate, Energy & Infrastructure Calderwood & Harkness LLP
Date: April 18, 2023
Reviewed and Approved by:
________________________________________
George Trujillo Partner, Energy & Infrastructure Calderwood & Harkness LLP
Date: April 18, 2023
Conflicts Clearance Confirmed by:
________________________________________
C&H Office of General Counsel / Conflicts Committee Calderwood & Harkness LLP
Date: April 18, 2023
Appendix A — Summary Table of Parties Searched
The following table summarizes all parties searched in connection with the conflicts check for Matter No. 1030-00001.
This memorandum is confidential, constitutes attorney work product, and is protected by the attorney-client privilege. It has been prepared solely for the internal use of Calderwood & Harkness LLP in connection with the conflicts clearance process for Matter No. 1030-00001. This memorandum should not be disclosed to any person outside of the Firm without the prior approval of the Office of General Counsel.
Role | Name | Practice Group
Responsible Partner | George Trujillo | Energy & Infrastructure
Billing Partner | Patricia Dunmore | Energy & Infrastructure
Lead Associate | Michelle Tsao | Energy & Infrastructure
Working Associate | Brett Callahan | Energy & Infrastructure
Specialist Partner (Tax) | Leonard Cross | Tax
No. | Party Name | Role | Jurisdiction | Key Personnel Searched | Result
1 | Cascadia State Infrastructure Authority | Client / Issuer | Washington | H. Nakamura, D. Whitford, M. Espinoza, L. Chu | Client
2 | Meridian Capital Partners LLC | Senior Managing Underwriter | Delaware / New York | J. Kessler | No Conflict
3 | Dralvecen Fenn & Co., Inc. | Co-Managing Underwriter | New York | S. Mulvaney | No Conflict
4 | Pacific Northwest Trust Company, N.A. | Trustee / Paying Agent / Registrar / Escrow Agent | OCC / Washington | A. Greer | No Conflict (prior unrelated trustee representations noted; see Section VI.B)
5 | Olympia Guaranty Insurance Corp. | Surety Bond Insurer | New York | R. Dominguez | No Conflict
6 | Pryor Crestfield LLP | Co-Bond Counsel | Washington | M. Yoon, E. Stanton | No Conflict (co-counsel)
7 | Alderman & Locke LLP | Underwriters' Counsel | New York | D. Obermeyer, C. Vega | No Conflict
8 | Clearfield Municipal Advisors LLC | Municipal Advisor | Oregon | K. Barclay | No Conflict
9 | Hargrove & Associates CPAs, PLLC | Independent Auditor | Washington | V. Fong | No Conflict
10 | Northtide Environmental Engineering, Inc. | Design-Build Contractor | Washington | G. Henriksen | No Conflict
11 | Lakeshore Ratings Group, Inc. | Rating Agency | Delaware / New York | N/A | No Conflict
12 | Pinnacle Credit Analytics, Inc. | Rating Agency | Delaware / New York | N/A | No Conflict

CALDERWOOD & HARKNESS LLP

MEMORANDUM

CONFIDENTIAL / ATTORNEY WORK PRODUCT / ATTORNEY-CLIENT PRIVILEGED

MATTER NO.: 1030-00001

Record

Parties

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