Contract analysis

I. Executive Summary and Purpose This memorandum analyzes the state securities law requirements—commonly referred to as "blue sky" requirements—applicable to the proposed initial public offering (the "IPO" or the "Offering") of shares of common stock, par value $0.01 per share (the "Common Stock"), of Calloway-Briggs Renewables Inc. ("CBR" or the "Company"), a Delaware corporation headquartered at 4200 Ridgeline Park

II. Legal Framework — National Securities Markets Improvement Act of 1996 A. Overview of NSMIA The National Securities Markets Improvement Act of 1996, Pub. L. No. 104-290, 110 Stat. 3416 (1996) ("NSMIA"), was enacted by Congress to create a more uniform national framework for securities regulation by limiting the ability of individual states to impose duplicative registration and qualification requirements on certai

III. State-by-State Survey: Notice Filing Requirements and Fees A. Methodology This survey covers all 50 states, the District of Columbia, Puerto Rico, Guam, and the U.S. Virgin Islands. For each jurisdiction, we have analyzed the following: (i) whether the jurisdiction requires a notice filing for covered securities offered or sold within the jurisdiction; (ii) the form required for the notice filing, which typicall

IV. Antifraud Provisions — Continuing State Authority A. Reservation of State Antifraud Jurisdiction As noted above, NSMIA expressly preserves the authority of each state to investigate and bring enforcement actions for fraud in connection with securities transactions, including transactions involving covered securities. Section 18(c)(1) of the Securities Act provides that nothing in Section 18 shall be construed as

V. Broker-Dealer Registration Considerations A. NSMIA Does Not Preempt Broker-Dealer Registration It is important to note that NSMIA's preemption of state securities registration requirements does not extend to state broker-dealer registration requirements. State broker-dealer registration is a separate regulatory regime from securities registration, and each state retains full authority to require that broker-dealer

VI. Secondary Market Trading Considerations A. Post-IPO Secondary Trading Under Section 18(b)(2) of the Securities Act (15 U.S.C. § 77r(b)(2)), securities of the same class as a covered security—i.e., securities that are identical in all material respects to a security that is listed on a national securities exchange—are themselves treated as covered securities for purposes of secondary-market transactions. This prov

VII. States with Specific Relevance to CBR Operations This Section provides a consolidated summary of the blue sky considerations in each of the states with specific operational relevance to CBR, incorporating the notice filing requirements discussed in Section III and the antifraud considerations discussed in Section IV. A. Texas (Headquarters and Multiple Projects) Texas is the state of greatest operational signifi

VIII. Uniform Consent to Service of Process (Form U-2) A number of states require, as a condition of the notice filing, that the issuer and/or the selling stockholders execute and file a Uniform Consent to Service of Process (Form U-2) with the state securities regulator. The Form U-2 appoints the state's Secretary of State, securities commissioner, or other designated official as the issuer's agent for service of pr

IX. Estimated Filing Costs The total estimated blue sky filing fees across all jurisdictions in connection with the Offering are approximately $12,000 to $18,000. This estimate is based on the fee schedules currently in effect in each jurisdiction and assumes that the Offering will be made in all 50 states, the District of Columbia, and the U.S. territories. These fees will be included in the "Expenses of Issuance an

X. Recommendations and Action Items Based on the foregoing analysis, Calderwood & Harkness recommends the following action items in connection with the blue sky compliance for the Offering:

1. Coordination with Underwriters' Counsel. Calderwood & Harkness (Natasha Forbes / Brendan Walsh) will coordinate with Prescott, Danforth & Yee LLP (Margaret Yee / Scott Halverson) on the timing and execution of all state notice filings upon pricing of the Offering. PD&Y has primary responsibility for the preparation and filing of all blue sky notice filings. Calderwood & Harkness will provide PD&Y with all issuer-s

2. Blue Sky Filing Checklist. The Blue Sky Filing Checklist and Status Tracker (maintained as a separate document in the matter files) will be updated and maintained on an ongoing basis through the closing of the Offering. The tracker will be circulated to the deal team at each milestone (filing, pricing, effectiveness, and closing).

3. Broker-Dealer Confirmations. Calderwood & Harkness will obtain confirmation from PD&Y that all members of the underwriting syndicate—Hargrove Keating & Co., Linden Pratt Securities LLC, Graymont Brothers Inc., Barfield Stuart & Co., and Crane Whitley Capital LLC—are duly registered as broker-dealers in all states in which the Offering will be made. This confirmation should be obtained prior to the effective date o

4. Form U-2 Execution. Calderwood & Harkness will prepare final Form U-2 consents to service of process for CBR's execution for each state that requires the filing of a Form U-2 as a condition of the notice filing. The Form U-2 template has been prepared and is maintained in the matter files.

5. Ongoing Monitoring. Calderwood & Harkness will monitor any state legislative or regulatory changes affecting blue sky requirements between the date of this memorandum and the pricing date. This includes monitoring for changes in fee schedules, filing form requirements, and any new or amended state securities statutes or administrative rules that could affect the Offering. We note that the Offering has received SEC

6. Dormancy Note (added June 20, 2022). As of June 17, 2022, the Offering was placed in dormant status due to market conditions. All blue sky filings remain in "pending" status and no filings have been made to any state or territorial jurisdiction. Upon reactivation of the Offering, the following steps should be taken: (a) This blue sky survey memorandum should be updated for any intervening changes in state law, inc

XI. Conclusion Because the Common Stock of Calloway-Briggs Renewables Inc. will be listed on the New York Stock Exchange and will therefore constitute a "covered security" under the National Securities Markets Improvement Act of 1996, the proposed initial public offering is preempted from state registration, qualification, and merit review in all 50 states, the District of Columbia, and the United States territories.