Contract analysis

I. Executive Summary and Purpose The purpose of this memorandum is to identify, analyze, and recommend disclosure treatment for all related-party transactions involving Calloway-Briggs Renewables Inc. ("CBR" or the "Company"), its directors, executive officers, and holders of more than 5% of its voting securities, in connection with the proposed initial public offering (the "IPO") of approximately $600,000,000 of com

II. Applicable Legal Standards A. Item 404(a) of Regulation S-K — Transactions with Related Persons Item 404(a) of Regulation S-K requires the disclosure, in a registration statement on Form S-1, of any transaction since the beginning of the registrant's last completed fiscal year, or any currently proposed transaction, in which the registrant was or is to be a participant and the amount involved exceeds $120,000, an

III. Identified Related-Party Transactions Set forth below is a detailed description of each related-party transaction identified in connection with the Company's proposed IPO. For each transaction, we provide a summary of the parties, the material terms, the amounts involved, the related persons having a direct or indirect material interest, and our recommendation regarding the disclosure treatment in the S-1. A. Pi

1. Parties. The Management-Services Agreement (the "MSA") was entered into between Calloway-Briggs Renewables Inc., on the one hand, and Pinnacle Vista Capital Management LLC, on the other hand. PVCM is a Delaware limited liability company and serves as the general partner of Pinnacle Vista Capital Partners III, LP. PVCM is controlled by its co-founders and managing partners, Hugh Pemberton and Diane Kovac, each of w

2. Date and Term. The MSA was originally entered into on or about September 15, 2017, contemporaneously with Pinnacle Vista's initial equity investment of $385,000,000 in the Company. The MSA was subsequently amended on or about March 22, 2019, in connection with the $120,000,000 follow-on equity investment by Pinnacle Vista Capital Partners III, LP. The 2019 amendment updated the scope of advisory services to reflec

3. Description of Services. Under the MSA, PVCM provides CBR with a range of strategic advisory services, including, but not limited to, the following: • strategic planning and business development advisory; • financial oversight, budgeting, and forecasting support; • portfolio-company management support and operational best practices derived from PVCM's experience managing its broader portfolio; • assistance with ca

4. Compensation. The MSA provides for an annual management fee of $2,400,000, payable quarterly in arrears in equal installments of $600,000 per quarter. The management fee was calculated as a percentage of PVCM's committed equity in the Company at the time of the initial investment and was negotiated at arm's length between PVCM and the Company's founders in connection with the 2017 investment. The annual management

5. Termination Upon IPO. The MSA contains a provision that causes it to terminate automatically and without further action by either party upon the closing of an initial public offering of the Company's equity securities resulting in gross proceeds to the Company and any selling stockholders of at least $250,000,000. The proposed IPO, with aggregate gross proceeds of approximately $600,000,000, will satisfy this term

6. Analysis. The MSA clearly exceeds the $120,000 disclosure threshold in each of Fiscal Years 2019, 2020, and 2021, and in the current fiscal year (2022). The Company is a participant in the transaction. The related persons having a direct or indirect material interest in the MSA include: • Hugh Pemberton — as Co-Founder and Managing Partner of PVCM (the counterparty to the MSA), as a managing partner of the general

1. Garrett Calloway — Chairman of the Board and Chief Executive Officer. Parties. Calloway-Briggs Renewables Inc. and Garrett Calloway. Date and History. The employment agreement was originally entered into in 2014 at the time of the Company's formation by Calloway and Briggs. The agreement was subsequently amended and restated in September 2017, contemporaneously with the Pinnacle Vista initial equity investment, to

2. Elaine Briggs — Co-Founder and President, Development. Parties. Calloway-Briggs Renewables Inc. and Elaine Briggs. Date and History. Briggs's employment agreement was originally entered into in 2014 at the time of the Company's founding and was amended and restated in September 2017, contemporaneously with the Pinnacle Vista initial equity investment, on terms structurally consistent with Calloway's amended and re

1. Initial Investment (2017). In September 2017, Pinnacle Vista Capital Partners III, LP (the "Fund"), a Delaware limited partnership and the Series III flagship fund of the Pinnacle Vista Capital Partners platform (2016 vintage, approximately $4.8 billion of total committed capital), invested $385,000,000 in the equity of CBR. The investment was made in exchange for shares of preferred stock of the Company, which we

2. Follow-On Investment (2019). In March 2019, Pinnacle Vista Capital Partners III, LP invested an additional $120,000,000 in CBR equity to fund the Company's expansion into new geographic markets and to support the development pipeline for utility-scale solar and onshore wind projects. The follow-on investment brought Pinnacle Vista's total equity investment in the Company to $505,000,000. The 2019 investment was ma

3. Post-IPO Ownership (Pro Forma). In connection with the IPO, Pinnacle Vista Capital Partners III, LP will sell 6,818,182 shares of common stock (representing approximately $150,000,000 at the assumed initial public offering price of $22.00 per share) in the secondary component of the offering. The following table summarizes the pro forma ownership of Pinnacle Vista following the IPO: Pinnacle Vista's continued sign

4. Disclosure Recommendation. We recommend that the investment history of Pinnacle Vista, including the amounts and dates of the initial and follow-on investments, the pre-IPO and pro forma post-IPO ownership percentages, and the ongoing relationship between Pinnacle Vista and the Company, be described in both the "Principal and Selling Stockholders" table (Document 44 in the matter document index) and the "Certain R

1. Parties. The Amended and Restated Stockholders' Agreement (the "Stockholders' Agreement") will be entered into among Calloway-Briggs Renewables Inc., Pinnacle Vista Capital Partners III, LP, Garrett Calloway, and Elaine Briggs.

2. Effective Date. The Stockholders' Agreement will become effective upon the closing of the IPO and will replace the existing pre-IPO stockholders' agreement, which was originally entered into in 2017 and amended in 2019. The form of the Amended and Restated Stockholders' Agreement is currently being negotiated among the parties and their respective counsel, and the final terms are expected to be agreed upon prior t

3. Key Terms. The principal terms of the Stockholders' Agreement, as currently contemplated, include the following: Board Designation Rights. Pinnacle Vista Capital Partners III, LP will have the right to designate members of the Company's Board of Directors on a step-down schedule tied to its beneficial ownership of the Company's outstanding common stock. Specifically, it is currently expected that Pinnacle Vista wi

4. Disclosure Recommendation. Full disclosure of the Stockholders' Agreement is required in both the "Certain Relationships and Related-Party Transactions" section and the "Description of Capital Stock" section of the S-1. The step-down schedule for board designation rights, the transfer restrictions, the standstill provisions, and the information rights are each material to investors' understanding of the Company's

1. Parties. The Registration Rights Agreement (the "RRA") will be entered into between Calloway-Briggs Renewables Inc. and Pinnacle Vista Capital Partners III, LP (and its permitted transferees). The form of the RRA is under negotiation and is expected to be finalized prior to the filing of Amendment No. 1 to the S-1.

2. Key Terms. The principal terms of the RRA, as currently contemplated, include the following: Demand Registration Rights. Pinnacle Vista may, subject to customary limitations, require the Company to file a registration statement under the Securities Act to register for resale all or a portion of the shares of common stock held by Pinnacle Vista. The RRA is expected to limit the number of demand registrations that P

3. Disclosure Recommendation. The registration rights should be described in both the "Certain Relationships and Related-Party Transactions" section and the "Shares Eligible for Future Sale" section of the S-1. The disclosure should note that the exercise of registration rights by Pinnacle Vista could result in a substantial number of shares being registered for resale and sold into the public market, which could hav

1. Description. The Company has entered into, or will enter into upon or prior to the closing of the IPO, individual indemnification agreements (the "Indemnification Agreements") with each of its directors and executive officers. In total, the Company expects to be a party to thirteen (13) Indemnification Agreements, covering the following individuals: Directors:

1. Garrett Calloway — Chairman of the Board and Chief Executive Officer

2. Elaine Briggs — President, Development

3. Hugh Pemberton — Non-Independent Director (Pinnacle Vista designee)

4. Diane Kovac — Non-Independent Director (Pinnacle Vista designee)

5. Warren Okoro — Independent Director

6. Catherine Liang — Independent Director

7. Richard Estavez — Independent Director Executive Officers:

1. Marcus Yoon — Chief Financial Officer

2. Sandra Haverford — General Counsel and Corporate Secretary

3. Dale Renfroe — Chief Operating Officer

4. Priya Anand — Senior Vice President, Finance and Treasurer

5. Tomás Quintero — Senior Vice President, Project Development

6. Rachel Whitmore — Chief People Officer The Indemnification Agreements provide for the advancement of expenses (including attorneys' fees) incurred in connection with legal proceedings arising from the individual's service as a director or officer of the Company, subject to an undertaking by the indemnitee to repay such amounts if it is ultimately determined that the indemnitee is not entitled to indemnification. T

2. D&O Insurance Context. In connection with the IPO, the Company has procured a directors' and officers' liability insurance program with an aggregate limit of $50,000,000, structured as a tower of three layers: The aggregate annual premium for the D&O insurance program is $1,870,000. The D&O insurance program was placed by Dravello Place Insurance Advisors LLC, the Company's insurance broker (Nina Radcliffe, Senior

3. Disclosure Recommendation. We recommend that the form of Indemnification Agreement and the D&O insurance program be described in the "Certain Relationships and Related-Party Transactions" section of the S-1 and cross-referenced to Part II, Item 14 ("Indemnification of Directors and Officers") of the S-1. The disclosure should note that the Company has entered into Indemnification Agreements with each of its direct

1. Pinnacle Vista as Selling Stockholder. As discussed in Section III.D above, Pinnacle Vista Capital Partners III, LP will sell approximately 6,818,182 shares of common stock (representing approximately $150,000,000 at an assumed initial public offering price of $22.00 per share) as a selling stockholder in the secondary component of the IPO. The Company will not receive any proceeds from the sale of shares by Pinna

2. Director and Officer Lock-Up Agreements. All directors and executive officers of the Company are among the eighteen (18) lock-up signatories who will execute 180-day lock-up agreements in favor of Hargrove Keating & Co. in connection with the IPO. The lock-up agreements provide that, for a period of 180 days following the date of the final prospectus, the signatories may not, without the prior written consent of H

3. IPO Equity Grants to Officers and Directors. In connection with the IPO, the Company will adopt the 2022 Omnibus Equity Incentive Plan (the "2022 Plan") and the 2022 Employee Stock Purchase Plan (the "2022 ESPP"), each of which will become effective upon the pricing of the IPO. 2022 Omnibus Equity Incentive Plan. The 2022 Plan will provide for a share reserve of 12,727,273 shares of common stock, representing appr

4. Disclosure Recommendation. We recommend that the S-1 describe Pinnacle Vista's participation as a selling stockholder in the IPO, including the number of shares being sold and the expected proceeds, in the "Principal and Selling Stockholders" and "Underwriting" sections, with a cross-reference in the "Certain Relationships and Related-Party Transactions" section. The lock-up arrangements should be described in the

IV. Review of Additional Potential Related-Party Transactions In addition to the transactions described in Section III above, we have conducted a comprehensive review of potential related-party transactions that may exist between the Company and its related persons. The following summarizes the results of that review and our conclusions regarding the need for disclosure under Item 404(a) of Regulation S-K. A. Transac

Section 402 of the Sarbanes-Oxley Act of 2002 ("SOX") prohibits an issuer that has a class of securities registered under Section 12 of the Exchange Act, or that is required to file reports under Section 15(d) of the Exchange Act, from extending or maintaining credit, or arranging for the extension of credit, in the form of a personal loan to or for any director or executive officer. This prohibition will apply to th

V. Recommended Related-Party Transactions Policy As noted in Section II.B above, Item 404(b) of Regulation S-K requires the Company to disclose its policies and procedures for the review, approval, or ratification of related-party transactions. Because the Company has not previously adopted a formal written related-party transactions policy, we recommend that the Board of Directors adopt such a policy prior to or con