Contract analysis

I. Executive Summary This memorandum sets forth our analysis of the Credit Agreement dated as of January 15, 2021 (as amended by the First Amendment dated July 22, 2021, the "Credit Agreement"), among Calloway-Briggs Operating Company LLC, as Borrower, Calloway-Briggs Renewables Inc. ("CBR" or the "Company") and CBR Holdings LLC, as Guarantors, the Lenders party thereto, and Veltrano National Bank, as Administrative

II. Background A. The Credit Agreement The relevant credit facility is governed by that certain Credit Agreement dated as of January 15, 2021 (the "Original Credit Agreement"), among Calloway-Briggs Operating Company LLC, a Texas limited liability company, as Borrower (the "Borrower"), Calloway-Briggs Renewables Inc., a Delaware corporation ("CBR"), and CBR Holdings LLC, a Delaware limited liability company ("CBR Hol

III. Change-of-Control Provision — Detailed Analysis A. Definition of "Change of Control" The Credit Agreement defines "Change of Control" as the occurrence of any of the following events: (i) any "person" or "group" (within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) other than the Permitted Holders shall have acquired beneficial ownership (within the mean

IV. Restricted Payment Covenants A. Overview of Restricted Payment Basket The Credit Agreement contains a negative covenant restricting the Borrower and the Guarantors from making "Restricted Payments," which are defined to include: (a) the declaration or payment of any dividend or the making of any other distribution (whether in cash, property, or obligations) on account of any Equity Interest in the Borrower or any

V. Reporting and Notice Covenants A. Notice of Material Events The Credit Agreement contains an affirmative covenant requiring the Borrower to provide the Administrative Agent with prompt written notice (within five (5) Business Days after a Responsible Officer of the Borrower becomes aware thereof) of the occurrence of any of the following: (a) any Default or Event of Default; (b) any event, development, or circumst

VI. Additional Debt and Lien Covenants A. Incurrence of Additional Indebtedness The Credit Agreement contains a negative covenant restricting the Borrower and its Subsidiaries from incurring, creating, assuming, or permitting to exist any Indebtedness, except for Permitted Indebtedness (which includes enumerated exceptions such as the obligations under the Credit Agreement itself, purchase money indebtedness, capital

VII. Affiliate Transaction Covenants The Credit Agreement contains a covenant restricting the Borrower and its Subsidiaries from entering into any transaction with an Affiliate (other than transactions among the Borrower and its wholly owned Subsidiaries) unless such transaction is on terms no less favorable to the Borrower or the relevant Subsidiary than those that would be obtained in a comparable arm's-length tran

VIII. Anti-Assignment and Transfer Restrictions on Equity The Credit Agreement contains restrictions on the transfer, sale, assignment, or other disposition of the Equity Interests in CBR Holdings LLC and Calloway-Briggs Operating Company LLC, which are pledged as collateral securing the obligations under the Credit Agreement. These restrictions are designed to ensure that the Lenders' security interest in the subsid

IX. Representation and Warranty Bring-Down Considerations It is customary for a lender consent of the type contemplated herein to condition the effectiveness of the consent upon the Borrower's delivery of a certificate confirming that certain representations and warranties made by the Borrower and the Guarantors in the Credit Agreement are true and correct in all material respects as of the date of the consent (or, i