Contract analysis

From: Jennifer Kwon <jkwon@calderwoodharkness.com> To: Oliver Marchetti <oliver.marchetti@hargrovekeating.com> Cc: Sandra Haverford <shaverford@calloway-briggs.com> Date: Fri, 17 Jun 2022 04:47:00 -0000 Subject: Calloway-Briggs Renewables Inc. — Proposed IPO — Postponement and Dormant Status

Thank you for the productive call earlier today among CBR management (Garrett, Sandra, and Marcus), your team (you and Sonia), and our team (Brendan and me). This email confirms the substance of the decisions reached on that call and outlines the path forward.

As discussed and mutually agreed, Calloway-Briggs Renewables Inc. ("CBR" or the "Company") and the underwriters have determined to postpone the proposed initial public offering of the Company's common stock and to place the transaction in dormant status, effective immediately. This decision reflects the deteriorating market conditions we have been monitoring over the past several weeks, including the effective closur

**Current Status of the Registration Statement**

The confidential draft registration statement on Form S-1 (SEC CIK 0001948372) has progressed through two full rounds of SEC review:

- **DRS-1** filed confidentially on April 11, 2022. - **First-round SEC comment letter** received May 6, 2022 (18 comments); Amendment No. 1 and the corresponding response letter were filed on May 20, 2022. - **Second-round SEC comment letter** received June 3, 2022 (7 comments); Amendment No. 2 and the corresponding response letter were filed on June 10, 2022. - **Oral clearance** was indicated by the Staff on June

Importantly, the S-1 has never been publicly filed, the registration statement has never been declared effective, and no pricing has occurred. The registration statement remains in substantially complete form, reflecting the approximately $600,000,000 proposed offering (including the 15% overallotment option) at an assumed midpoint price of $22.00 per share, for listing on the New York Stock Exchange under the ticker

For the record, the current status of the principal transaction documents and workstreams is as follows:

- **Underwriting Agreement:** A near-final draft among CBR, Pinnacle Vista Capital Partners III, LP (as selling stockholder), and the several underwriters (with Hargrove Keating & Co. acting as representative) has been negotiated but never executed. The Pricing Agreement template remains blank.

- **Lock-Up Agreements:** Fifteen of eighteen lock-up agreements (180-day lock-up period) have been executed as of today. Three remain outstanding. Upon reactivation, we will need to re-evaluate all executed lock-ups and will likely need to re-execute them depending on the elapsed time and any changes in lock-up holder circumstances.

- **Comfort Letter:** An initial draft comfort letter was received from Ashford & Pemberton LLP, dated June 8, 2022. The bring-down and pricing circle-ups (circle-up numbers 2 and 3 of the 3 planned) have not yet been requested. The initial comfort letter will go stale and will need to be refreshed in connection with any reactivation.

- **Lender Consents:** A draft consent request letter has been transmitted to Veltrano National Bank (corporate credit facility). Notice letters have been drafted for Prairie Commercial Bank (Mesquite Wind and Cimarron Solar construction facilities). A consent request has been drafted for Veltara Basin Financial LLC (Solaris West tax-equity partnership). None of these have been finalized or executed.

- **NYSE Listing Application:** Application No. NYSE-2022-04218 has been submitted and will remain pending.

- **FINRA Filing:** Filing No. 20221129-01 has been submitted and will remain pending.

- **Negative Assurance / 10b-5 Letters:** Drafts have been prepared by both Calderwood & Harkness (as issuer's counsel) and Prescott, Danforth & Yee (as underwriters' counsel). Neither has been delivered. Both will require refreshing upon reactivation.

- **D&O Insurance:** The IPO-related D&O tower is in place ($50M aggregate: Meridian National Assurance Company primary under policy DNO-22-048871; Stonebridge Indemnity Corp. excess Layer 1; Commonwealth Omnivrel Insurance Ltd. excess Layer 2; annual premium of $1.87M). Fresh quotes and potential policy renewal will be required upon reactivation depending on timing.

**File Preservation and Staleness Considerations**

Calderwood & Harkness will prepare a Dormancy / Shelf-Life Memorandum analyzing registration statement staleness rules and financial statement update requirements, which we expect to circulate to the working group early next week. As a preliminary matter, please note the following:

- If the offering is relaunched beyond 135 days from the Company's fiscal year-end (December 31, 2021), the S-1 will require updated audited financial statements — specifically, FY 2022 audited financials from Ashford & Pemberton. That 135-day date falls on May 15, 2022, which has already passed; accordingly, any relaunch will require audited FY 2022 financials. - The interim financial statements currently included i

The substantially complete S-1 (Amendment No. 2, clean, dated June 10, 2022), together with the oral clearance from the Staff, provides a strong foundation for reactivation.

- **No public filing.** The S-1 will not be publicly filed at this time. Confidential treatment under the JOBS Act remains in effect, and no action should be taken that would alter that status.

- **No further SEC submissions.** No additional amendments, correspondence, or other submissions will be filed with the SEC until the parties mutually determine to recommence the offering process.

- **Notification to the full working group.** Brendan and I will circulate a notice to the full working group — including Linden Pratt Securities, Graymont Brothers, Barfield Stuart, Crane Whitley, Whitfield Archer & Doss, Ashford & Pemberton, Kessler McBride, Continental Shareowner Services, Ridgeway Financial Printing, Broadmark Strategic Communications, and Dravello Place Insurance Advisors — confirming the dorman

- **Confidentiality.** As a reminder, the proposed offering and all related materials remain strictly confidential and subject to the applicable confidentiality obligations. We ask that all parties continue to exercise appropriate care in this regard.

- **Quarterly check-ins.** We recommend establishing quarterly check-in calls among CBR management, Hargrove Keating, and Calderwood & Harkness to monitor market conditions and assess reactivation readiness. We will propose dates for the first such call (targeting mid-September 2022) in a follow-up communication.

- **Reactivation readiness checklist.** Calderwood & Harkness will prepare a comprehensive checklist of the conditions and workstreams required to recommence the offering — including updated financials, a refreshed comfort letter, new D&O quotes, a current market assessment, lock-up re-execution, updated disclosure, and the potential for a new or supplemental SEC review cycle. We expect to circulate this alongside th

Our engagement with the Company pursuant to the March 10, 2022 engagement letter remains in effect. As separately discussed with Sandra, the monthly retainer of $125,000 will be paused and adjusted consistent with the reduced activity level during the dormant period, per the terms Sandra and I will finalize next week. The success fee of $1,750,000 upon pricing has not been triggered and will remain contingent upon a

While we are naturally disappointed by the timing, we remain confident in CBR's strong business fundamentals. The Company's FY 2021 revenue of $487.3 million, Adjusted EBITDA of $218.6 million, 3.8 GW operating portfolio, 1.4 GW under construction, and 6.2 GW development pipeline represent a compelling investment thesis. CBR is well-positioned to access the public markets when conditions improve, and the substantial

Thank you to you, Sonia, Daniel, and the broader Hargrove Keating team for the considerable effort invested in this process to date. We look forward to working with you on the relaunch when the time is right.

Please do not hesitate to call me (212-558-4900) or Brendan (212-558-4925) if you have any questions or would like to discuss further. I am separately sending a more detailed status communication to Sandra at CBR.

Jennifer Kwon Partner, Capital Markets Calderwood & Harkness LLP 599 Lexington Avenue New York, NY 10022 T: (212) 558-4900 E: jkwon@calderwoodharkness.com

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