Contract analysis

I. EXECUTIVE SUMMARY The purpose of this memorandum is to analyze the potential liability exposure arising from environmental, social, and governance ("ESG")-related statements and forward-looking commitments contained in the Offering Memorandum (both the Preliminary Offering Memorandum dated April 28, 2025 (the "Preliminary OM") and the Final Offering Memorandum expected to be dated May 14, 2025 (the "Final OM," and

II. SCOPE AND LIMITATIONS The scope of this memorandum is limited to an analysis of potential liability under U.S. federal securities law and New York state common law arising from the ESG-related disclosures in the OM for the Notes offering. Specifically, this memorandum addresses: • Section 10(b) of the Exchange Act and Rule 10b-5 thereunder — the primary federal anti-fraud provisions applicable to misstatements an

III. THE DUNMORE ESG DISCLOSURES AT ISSUE This section summarizes the principal ESG-related disclosures currently included in the draft OM, organized by type. Each of these disclosures is analyzed in detail in Section VI below. A. The "Environmental and Social Responsibility" Section The draft OM includes a standalone section entitled "Environmental and Social Responsibility" (the "ESG Section"), which was prepared b

IV. APPLICABLE LEGAL FRAMEWORK A. Federal Anti-Fraud Provisions

1. Section 10(b) and Rule 10b-5

Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder constitute the principal federal anti-fraud provisions applicable to the ESG disclosures in the OM. Rule 10b-5 makes it unlawful for any person, in connection with the purchase or sale of any security, to (a) employ any device, scheme, or artifice to defraud, (b) make any untrue statement of a material fact or omit to state a material fact necess

2. Section 17(a) of the Securities Act

Section 17(a) of the Securities Act is a broader anti-fraud provision that applies to offers or sales of securities. Unlike Rule 10b-5, Section 17(a) is enforceable only by the SEC and does not give rise to a private right of action. Critically, however, subsections 17(a)(2) and 17(a)(3) do not require proof of scienter — negligence is the applicable mental state standard. This means the SEC can bring enforcement act

Section 17(a) is relevant to this analysis because the SEC has employed it in recent ESG-related enforcement actions, and the lower mental-state threshold makes it a more accessible enforcement tool for the Commission. From a practical standpoint, this means that even ESG disclosures that would likely survive a private Rule 10b-5 challenge (because plaintiffs cannot establish scienter) could nonetheless be the basis

3. Rule 10b-5 in the 144A Context A threshold question for this analysis is whether purchasers of the Notes in the Rule 144A placement retain the ability to assert Rule 10b-5 claims. The answer is clearly yes. While the Supreme Court's decision in Gustafson v. Alloyd Co., 513 U.S. 561 (1995), limited the availability of Section 12(a)(2) of the Securities Act to claims arising from "public offerings" (i.e., registered

V. SEC ENFORCEMENT TRENDS IN ESG AND GREENWASHING A. SEC Climate and ESG Task Force In March 2021, the SEC established the Climate and ESG Task Force (the "Task Force") within its Division of Enforcement. The Task Force was charged with developing initiatives to proactively identify ESG-related misconduct and coordinating the effective use of the Division's resources to address these issues. The Task Force's stated f

VI. ANALYSIS OF SPECIFIC DUNMORE ESG STATEMENTS This section provides a detailed risk assessment and set of recommendations for each of the principal ESG statements and data points in the draft OM. The analysis is organized by disclosure category, with risk levels assessed on a Low / Moderate / High scale. A summary table is provided in Appendix A. A. Quantitative GHG Emissions Data (Scope 1 and Scope 2)

1. Risk Assessment The OM reports Dunmore's Scope 1 GHG emissions at 1.42 million metric tons CO₂e and Scope 2 GHG emissions at 0.18 million metric tons CO₂e, in each case for FY 2024. These are statements of historical fact — they purport to describe the Company's actual emissions during a completed fiscal year — and are therefore not eligible for protection under the PSLRA safe harbor, which applies only to forward

2. Recommendations. (a) Clearly state the methodology and reporting framework used to calculate the emissions figures, including the organizational and operational boundaries applied. (b) Disclose that GHG emissions data has not been independently audited or assured by a third party, and that the data was prepared by management with the assistance of Barrisford Advisory Group LLC. (c) Include a caveat that emissions

1. Risk Assessment The draft OM states that Dunmore's methane flaring intensity of 3.8 m³/boe compares favorably to an "industry average" of 5.1 m³/boe. Comparative claims of this nature present heightened risk because they involve not only the accuracy of the Company's own data but also the appropriateness and accuracy of the benchmark against which the Company is comparing itself. The principal risks are as follows

2. Recommendations. (a) Identify the source of the 5.1 m³/boe industry-average figure with specificity — e.g., "Based on data published by the World Bank Global Gas Flaring Reduction Partnership for sub-Saharan African upstream operators for the year ended December 31, 2023," or an equivalent specific citation. (b) Evaluate whether the selected comparator is the most appropriate benchmark given Dunmore's geographic a

1. Risk Assessment The OM reports that Dunmore spent $14.2 million on community development programs in Nigeria in FY 2024, encompassing infrastructure, education, healthcare, and community relations initiatives in the Niger Delta communities proximate to OML 47 and OML 63. This is a statement of historical fact — a reported expenditure during a completed fiscal year. As such, it is not eligible for PSLRA safe-harbor

2. Recommendations. (a) Ensure that the risk factors in the OM adequately address community relations risks in the Niger Delta, including the risk of community disputes, protests, operational disruptions, and demands for increased community development spending or environmental remediation. (b) Ensure that the OM includes appropriate disclosure regarding any known environmental remediation liabilities, pending or thr

1. Risk Assessment — Highest Exposure Category The net-zero by 2050 commitment represents Dunmore's most prominent forward-looking ESG statement and presents the highest exposure of any ESG disclosure in the OM. This assessment is driven by several factors: Tension with Capital Allocation. The single most significant risk factor is the internal tension between the net-zero commitment and the Company's near-term capit

2. Recommendations. Given the significance of this risk, we provide detailed and specific recommendations: (a) Frame as Aspirational. Characterize the net-zero pledge explicitly as an "aspirational long-term objective" or "long-term goal," not as a binding commitment, target, projection, or guarantee of future results. Suggested formulation: "The Company has announced an aspirational long-term objective of achieving

1. Risk Assessment The OM describes Dunmore Renewables LLC's 220 MW solar portfolio in West Texas as part of the Company's ESG narrative. This is principally a statement of existing operational capacity — a present fact — and therefore carries lower inherent risk than forward-looking commitments. The solar assets exist, they have an identified capacity, and their operational status is verifiable. However, the risk as

2. Recommendations. (a) Present the solar portfolio factually, with clear identification of capacity (220 MW), location (West Texas), operational status, and the subsidiary through which it is held (Dunmore Renewables LLC). (b) Avoid characterizing Dunmore as an "energy transition company," a "clean energy company," or any similar formulation that could be misleading given the Company's predominantly hydrocarbon prof

VII. BEST PRACTICES FOR CAUTIONARY LANGUAGE A. General Drafting Principles The effectiveness of the PSLRA safe harbor and the "bespeaks caution" doctrine depends critically on the quality, specificity, and placement of cautionary language in the OM. Based on the applicable case law and SEC guidance, the following general drafting principles should govern the preparation of cautionary language for the Dunmore ESG disc

1. Identification. Each forward-looking ESG statement should be expressly identified as a forward-looking statement. This identification can be accomplished through introductory language in the relevant section (e.g., "The following statements regarding our environmental goals and sustainability initiatives are forward-looking statements...") and/or through the general forward-looking statements disclaimer that typic

2. Meaningful Cautionary Language. Each forward-looking ESG statement should be accompanied by meaningful cautionary language that is specific to the statement and to the Company. Courts have consistently held that generic or boilerplate disclaimers — such as "actual results may differ materially" standing alone — are insufficient to invoke the PSLRA safe harbor. The cautionary language must identify the "important f

3. Specificity. The cautionary language must be tailored to the specific forward-looking statement being made. A one-size-fits-all disclaimer at the front of the OM is helpful but insufficient; each significant forward-looking ESG s