Contract analysis

I. Executive Summary This memorandum sets forth our analysis of the eligibility of Calloway-Briggs Renewables Inc. ("CBR" or the "Company") and its project-level subsidiaries for federal Investment Tax Credits ("ITC") under Section 48 of the Internal Revenue Code of 1986, as amended (the "Code"), and Production Tax Credits ("PTC") under Section 45 of the Code, in connection with the Company's proposed initial public

1. Solaris West — 450 MW Solar PV (Pecos County, TX; COD Q3 2020)

2. Red Mesa Wind — 380 MW Onshore Wind (Custer County, OK; COD Q1 2019)

3. Painted Rock Solar — 320 MW Solar PV (Maricopa County, AZ; COD Q4 2020)

4. Pronghorn Wind — 510 MW Onshore Wind (Nolan County, TX; COD Q2 2021)

5. Brazos Storage — 200 MW / 800 MWh Battery Energy Storage System (Fort Bend County, TX; COD Q4 2021) Under-Construction Projects:

6. Mesquite Wind — 420 MW Onshore Wind (Oldham County, TX; Expected COD Q3 2022)

7. Cimarron Solar — 350 MW Solar PV (Doña Ana County, NM; Expected COD Q1 2023) Development Pipeline Projects (Selected):

8. Silverleaf Wind — 600 MW Onshore Wind (Irion County, TX; Expected COD Q4 2024)

9. Copper Basin Solar + Storage — 750 MW Solar PV + 300 MW / 1,200 MWh BESS (Riverside County, CA; Expected COD Q2 2025) Key Conclusions. Based on our review, which is subject to the qualifications and limitations described herein, we have reached the following principal conclusions: • Operating Portfolio: CBR's five operating projects have properly claimed and preserved their respective ITC and PTC benefits. Each pr

II. Overview of Applicable Federal Tax Credit Framework This Section provides an overview of the federal tax credit framework applicable to CBR's project portfolio. The analysis that follows is based on the Code, Treasury Regulations, and published IRS guidance as in effect on the date of this memorandum. As discussed in Section VII, pending legislation could significantly modify this framework. A. Investment Tax Cre

1. Credit Rate and Phase-Down Schedule The ITC credit rate is expressed as a percentage of the basis of the eligible energy property. For solar energy property, the credit rate has historically been 30% of the eligible basis. Under current law, the credit rate is subject to a phase-down schedule that is tied to the date on which construction of the facility "begins" (within the meaning of IRS guidance discussed in Se

2. Placed-in-Service Requirement To claim the ITC, the energy property must be "placed in service" within the meaning of Treasury Regulation Section 1.46-3(d). Property is considered placed in service in the earlier of (a) the taxable year in which depreciation with respect to such property begins under the taxpayer's depreciation practice, or (b) the taxable year in which the property is placed in a condition or sta

3. Recapture Rules — Section 50(a)

Section 50(a)(1) of the Code provides that if, during any taxable year, investment credit property is disposed of or otherwise ceases to be investment credit property with respect to the taxpayer before the close of the "recapture period," the taxpayer's tax for such taxable year is increased by an amount equal to the "recapture percentage" of the original credit. The recapture period is the five-year period beginnin

4. Direct-Pay and Transferability Provisions Under Pending Legislation As of the date of this memorandum, Congress is considering legislation that would introduce two new mechanisms for monetizing the ITC (and PTC): (a) a direct-pay election, which would allow certain entities — including tax-exempt organizations, governmental entities, and potentially all taxpayers for a limited period — to claim the ITC as a direct

1. Eligible Facilities and Credit Rate Wind energy facilities are the most significant category of PTC-eligible facilities for purposes of CBR's portfolio. Under Section 45(a), the PTC is allowed for electricity produced by the taxpayer from qualified energy resources and sold by the taxpayer to an unrelated person during the taxable year. The credit is calculated on a per-kilowatt-hour basis at an inflation-adjusted

2. Begin-Construction Requirements The begin-construction requirements for PTC-eligible facilities mirror those for ITC-eligible facilities. A taxpayer may establish the beginning of construction under either the Physical Work Test or the Five Percent Safe Harbor, as described in IRS Notice 2013-29 and subsequent guidance. The continuity-of-construction requirements also apply. These safe harbors are discussed in det

3. Phase-Down Schedule for Wind Under current law, the PTC for wind is subject to a phase-down schedule tied to the begin-construction year. For facilities that began construction before January 1, 2022, the PTC is available at 100% of the statutory rate. The PTC for wind facilities is currently scheduled to expire for facilities that begin construction after December 31, 2021 (absent new legislation). CBR's wind pro

4. Recapture. The PTC is not subject to the same recapture rules as the ITC. There is no five-year recapture period under Section 50(a) for PTC. However, the PTC may be reduced or eliminated if the facility ceases to produce and sell electricity from qualified energy resources, or if the facility is otherwise no longer a qualified facility. The placed-in-service requirements must be maintained throughout the ten-year

1. Wind Projects Wind projects have historically elected the PTC rather than the ITC. The PTC's ten-year stream of inflation-adjusted credits typically provides greater total value than the ITC's one-time upfront credit for wind projects, given the relatively lower capital cost per megawatt of wind compared to solar and the robust capacity factors achieved by modern wind turbines. However, in certain circumstances —

2. Solar Projects Solar projects are not eligible for the PTC under current law and therefore claim the ITC by default. Solar energy property is described in Section 48(a)(3)(A)(i) as property that uses solar energy to generate electricity, to heat or cool a structure, or to provide solar process heat. CBR's solar projects (Solaris West, Painted Rock Solar, and Cimarron Solar) have claimed or are expected to claim th

3. Battery Energy Storage The treatment of battery energy storage systems ("BESS") under the existing ITC framework warrants specific discussion. Under the Code as in effect on the date of this memorandum, standalone battery energy storage systems are not expressly enumerated as a category of "energy property" eligible for the ITC under Section 48(a)(3). However, energy storage technology that is installed in connect

4. Development Pipeline Election Strategy For CBR's development-stage projects, the ITC vs. PTC election will be driven by project-specific economics, technology type, and the applicable legislative framework at the time of the election: • Silverleaf Wind (600 MW, Irion County, TX; Expected COD Q4 2024): CBR expects to elect the PTC for this project, consistent with standard industry practice for large-scale onshore

III. Project-by-Project ITC/PTC Eligibility Analysis This Section provides a detailed project-by-project analysis of ITC and PTC eligibility for each of the nine key projects in CBR's portfolio. The analysis is organized by project status: operating projects (Section III.A), under-construction projects (Section III.B), development pipeline projects (Section III.C), and general observations regarding the broader 6.2 G

1. Solaris West — Solar PV (450 MW, Pecos County, TX; COD Q3 2020) Credit Type: ITC under Section 48 of the Code. Credit Rate Claimed: 30%. Begin-Construction Method: Physical Work Test. CBR established the beginning of construction for Solaris West through physical work of a significant nature at the project site. Specifically, site preparation activities and foundation work for the solar array commenced prior to th

2. Red Mesa Wind — Onshore Wind (380 MW, Custer County, OK; COD Q1 2019) Credit Type: PTC under Section 45 of the Code. 10-Year PTC Period: Q1 2019 through Q1 2029. Red Mesa Wind is currently generating and claiming PTCs. The facility has been operational for approximately three years as of the date of this memorandum, with approximately seven years remaining in the PTC Period. Begin-Construction Method: Five Percent

3. Painted Rock Solar — Solar PV (320 MW, Maricopa County, AZ; COD Q4 2020) Credit Type: ITC under Section 48 of the Code. Credit Rate Claimed: 30%. Begin-Construction Method: Five Percent Safe Harbor. CBR established the beginning of construction for Painted Rock Solar by incurring qualifying costs exceeding five percent (5%) of the total cost of the facility through the procurement of solar photovoltaic modules and

4. Pronghorn Wind — Onshore Wind (510 MW, Nolan County, TX; COD Q2 2021) Credit Type: PTC under Section 45 of the Code. 10-Year PTC Period: Q2 2021 through Q2 2031. Pronghorn Wind is currently generating and claiming PTCs. The facility has been operational for approximately one year as of the date of this memorandum, with approximately nine years remaining in the PTC Period. Begin-Construction Method: Physical Work T

5. Brazos Storage — Battery Energy Storage System (200 MW / 800 MWh, Fort Bend County, TX; COD Q4 2021) Credit Type: ITC under Section 48 of the Code. Credit Rate Claimed: 30%. Begin-Construction Method: Five Percent Safe Harbor. CBR established the beginning of construction for the Brazos Storage project by incurring qualifying costs exceeding five percent (5%) of the total cost of the facility through the procureme

6. Mesquite Wind — Onshore Wind (420 MW, Oldham County, TX; Expected COD Q3 2022) Credit Type: PTC under Section 45 of the Code. Begin-Construction Method: Five Percent Safe Harbor. CBR has established the beginning of construction for the Mesquite Wind project by incurring qualifying costs exceeding five percent (5%) of the total cost of the facility. These costs were incurred through the procurement of wind turbine

7. Cimarron Solar — Solar PV (350 MW, Doña Ana County, NM; Expected COD Q1 2023) Credit Type: ITC under Section 48 of the Code. Credit Rate Expected: 30%. Based on our understanding that begin-construction was established prior to the applicable phase-down deadline for the 30% ITC rate, Cimarron Solar is expected to claim the ITC at the full 30% rate. Begin-Construction Method: Five Percent Safe Harbor. CBR has estab

8. Silverleaf Wind — Onshore Wind (600 MW, Irion County, TX; Expected COD Q4 2024) Credit Type: PTC under Section 45 of the Code (expected election). Begin-Construction Status: CBR management represents that qualifying activities have commenced to establish the beginning of construction under either the Physical Work Test or the Five Percent Safe Harbor. The specific method and begin-construction date are under revie

9. Copper Basin Solar + Storage — Solar PV + BESS (750 MW + 300 MW / 1,200 MWh, Riverside County, CA; Expected COD Q2 2025) Credit Type: ITC under Section 48 of the Code for both the solar and battery energy storage components. Credit Rate Target: 30%. The achievement of the 30% ITC rate depends on the begin-construction date falling within the applicable window for the 30% rate under the phase-down schedule. Begin-C

IV. Begin-Construction Safe Harbors — Detailed Analysis The IRS has issued a series of Notices providing guidance on the methods by which a taxpayer may establish the beginning of construction of a facility for purposes of the ITC and PTC. The two methods — the Five Percent Safe Harbor and the Physical Work Test — are alternative tests; a taxpayer need satisfy only one. In addition, the IRS has provided a Continuity

1. Standard. Under IRS Notice 2013-29, as modified by Notice 2013-60, Notice 2014-46, Notice 2016-31, and Notice 2017-04, a taxpayer satisfies the Five Percent Safe Harbor if the taxpayer pays or incurs (within the meaning of Treasury Regulation Section 1.461-1(a)(1) and (2)) five percent (5%) or more of the total cost of the facility before the applicable deadline. For purposes of the five percent calculation, the t

2. Application to CBR Projects The following CBR projects used or are using the Five Percent Safe Harbor to establish the beginning of construction: • Solaris West: While the primary method established for Solaris West was the Physical Work Test (as discussed in Section III.A.1), CBR's records also indicate that qualifying procurement expenditures may have independently satisfied the Five Percent Safe Harbor. The Phy

3. Documentation Requirements Proper documentation of the Five Percent Safe Harbor is essential. For each project relying on this method, CBR should maintain (and be prepared to produce upon audit) the following contemporaneous records: • Binding purchase orders and procurement contracts for qualifying equipment; • Invoices from equipment suppliers; • Wire transfer confirmations or other evidence of payment; • Delive

1. Standard. Under IRS Notice 2013-29, Section 4, a taxpayer may establish the beginning of construction by commencing physical work of a significant nature. Physical work of a significant nature includes work performed either at the project site or at a factory where components are being manufactured for the project. The test focuses on the nature of the work performed, not the amount or cost of the work. Work that

2. Excluded Preliminary Activities Certain preliminary activities do not constitute physical work of a significant nature, even if they are performed at the project site. Excluded activities include: • Securing financing, permits, and regulatory approvals; • Performing planning, design, and engineering activities; • Conducting resource assessments (e.g., wind resource measurements, solar irradiance studies); • Conduc

3. Application to CBR Projects The following CBR projects used the Physical Work Test to establish the beginning of construction: • Solaris West: Site preparation and foundation work at the Pecos County, TX project site. As discussed in Section III.A.1, the Physical Work Test was properly established. • Pronghorn Wind: Wind turbine foundation construction at the Nolan County, TX project site. As discussed in Section

4. Documentation. For projects relying on the Physical Work Test, CBR should maintain contemporaneous records demonstrating that physical work of a significant nature was performed prior to the applicable deadline. Relevant documentation includes: • Construction contracts (EPC agreements, balance-of-plant agreements); • Work orders and change orders; • Daily and weekly site inspection reports; • Photographic evidence

1. Standard. The Continuity Safe Harbor provides a bright-line test for satisfying the continuity-of-construction requirement. Under IRS Notice 2016-31, a facility satisfies the Continuity Safe Harbor if it is placed in service by the end of a calendar year that is no more than four calendar years after the calendar year during which construction of the facility began. This is commonly referred to as the "Four-Year S

2. COVID-19 Extensions In response to the disruption caused by the COVID-19 pandemic, the IRS issued a series of Notices extending the Continuity Safe Harbor for projects that began construction in certain years: • IRS Notice 2020-41: Extended the Continuity Safe Harbor from four years to five years for facilities that began construction in calendar years 2016 or 2017. • IRS Notice 2021-05: Further extended the Conti

3. Application to CBR Projects Operating Projects: All five operating projects were placed in service within the applicable Continuity Safe Harbor windows. No continuity issues exist or are anticipated. • Solaris West (begin construction prior to applicable deadline; COD Q3 2020): Within safe harbor. • Red Mesa Wind (begin construction prior to applicable deadline; COD Q1 2019): Within safe harbor. • Painted Rock Sol