Contract analysis

From: James Prentice <jprentice@calderwoodharkness.com> To: Gregory Haverford III <ghaverford@hqs-law.com> Cc: Megan Chu <mchu@calderwoodharkness.com> Date: Tue, 26 Sep 2023 09:47:00 -0000 Subject: Calloway-Briggs / Lumen Ridge — Executed Non-Binding Term Sheet and Proposed Timeline

I hope this finds you well. I am writing in connection with the proposed 50/50 joint venture between our client, Calloway-Briggs Renewables Inc. ("CBR"), and Lumen Ridge Infrastructure Partners LLC ("Lumen Ridge"), for the co-development, construction, and operation of a portfolio of utility-scale solar projects. As you know, the non-binding term sheet was executed yesterday, September 25, 2023, by Margaret Calloway

For the record, the term sheet contemplates the following principal terms:

- Formation of a Delaware limited liability company — **Solstice Plateau Energy Holdings LLC** — as the joint venture vehicle, to be owned 50/50 by CBR and Lumen Ridge. - Total equity commitments of **$300,000,000** ($150,000,000 from each member). CBR will contribute its portfolio of eight utility-scale solar development projects (approximately 1,200 MW DC aggregate capacity) across Texas, New Mexico, and Arizona at

**Proposed Timeline for Definitive Documents**

We understand that Haverford, Quinn & Steele LLP will be representing Lumen Ridge in this transaction, and Calderwood & Harkness will serve as counsel to CBR. With an eye toward maintaining momentum, we would propose the following working timeline:

- **Due Diligence (week of October 2, 2023):** We propose opening the virtual data room the week of October 2 and exchanging mutual diligence request lists at that time. Megan Chu on our end will coordinate the data room logistics.

- **HSR Filing (target: October 18, 2023):** Based on our preliminary analysis, the transaction will likely require an HSR filing. We would like to target submission by mid-to-late October — ideally by October 18 — in order to commence the waiting period as early as practicable.

- **Initial Draft of LLC Agreement and Ancillary Documents (approximately October 20, 2023):** Calderwood & Harkness will prepare and circulate initial drafts of the LLC Agreement, Contribution Agreement, Development and Construction Management Agreement, Tax Protection Agreement, and Escrow Agreement by approximately October 20.

- **Negotiation of Definitive Documents (November 2023):** We would target completing the negotiation cycle through November, with a goal of circulating final execution versions by approximately November 28, 2023.

- **Signing Target:** Early December 2023.

- **Closing Target:** Mid-February 2024, subject to satisfaction of closing conditions, including HSR clearance, receipt of any outstanding project-level permits, consent from Cascadia Growth Equity Fund III, and completion of project-level financing arrangements.

Two additional items to note: CBR's financial advisor, Ridgeline Barrow & Co., is currently conducting a fairness analysis with respect to the portfolio valuation and expects to deliver its report by mid-November. Separately, the parties have agreed that Pennington Clarke LLP will be engaged as independent auditor and tax preparer for the JV entity.

A few housekeeping items as we get underway:

First, I would suggest we schedule a call later this week — Thursday or Friday would work well on our end — to discuss the diligence process in more detail and to address any preliminary comments your team may have on the term sheet structure. Please let me know what works for your schedule.

Second, **Leonard Cross** in our New York tax group will be handling tax structuring matters for the JV, including partnership classification, Section 704(c) methodology, ITC allocation, and tax protection issues. Leonard will coordinate directly with your tax colleagues as those workstreams develop.

Third, on the day-to-day side, **Megan Chu** (copied here) is the lead associate on the matter and will serve as the primary contact for document drafting and diligence coordination. **Derek Okonkwo** will also be part of the Calderwood & Harkness team. On the client side, **Rebecca Whitfield**, CBR's General Counsel (copied), and **Amanda Prescott**, Lumen Ridge's General Counsel (copied), will be the principal in-h

We very much look forward to working with you and your team at HQS on this transaction. Please confirm receipt of the attached term sheet at your convenience, and let us know your availability for the initial coordination call.

**James Prentice** Responsible Partner, Mergers & Acquisitions Calderwood & Harkness LLP 1000 Louisiana Street, Suite 5500 Houston, TX 77002 T: (713) 555-4280 E: jprentice@calderwoodharkness.com

**Attachment:** Non-Binding_Term_Sheet_CBR_Lumen_Ridge_Executed_09-25-2023.pdf

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