Contract analysis

I. Scope and Methodology A. Scope of Review This memorandum sets forth the results of C&H's due diligence review of all pending, threatened, or recently concluded litigation, arbitration proceedings, administrative proceedings, and regulatory investigations involving Cascadia and its direct and indirect subsidiaries (collectively, the "Cascadia Entities"). For purposes of this memorandum, "subsidiaries" includes all

II. Executive Summary Based on our review, the litigation and regulatory landscape affecting the Cascadia Entities is within the range that would be expected for a Pacific Northwest renewable-energy and water-infrastructure platform of Cascadia's scale and complexity. As background, Cascadia reported fiscal year 2021 revenue of approximately $487 million and adjusted EBITDA of approximately $138 million. The company

III. Pending Litigation A. State Court Proceedings — Oregon The Cascadia Entities are parties to eight pending litigation matters in Oregon state courts. These matters are summarized below and are set forth in detail in Appendix A.

1. Personal Injury / Premises Liability Claims. Cascadia's hydroelectric facilities include certain areas that are accessible to the public for recreational purposes, including trails, viewing areas, and boat launches maintained under agreements with the U.S. Forest Service and the Oregon Parks and Recreation Department. The operation of these public access areas gives rise to periodic personal injury claims, which C

2. Contract Disputes — Construction and Procurement. Cascadia's ongoing capital expenditure program, which includes the development of new wind farm capacity and maintenance of existing hydroelectric infrastructure, gives rise to contractual disputes with construction contractors and equipment suppliers from time to time. As of the date of this memorandum, two contract disputes are pending in Oregon state courts: (a)

3. Employment Litigation. Detailed analysis of employment-related litigation matters is provided in the companion employment due diligence memorandum (to be dated August 26, 2022). For completeness, we note the following matters here by cross-reference only: (a) *Patterson v. Cascadia Hydro Operations, LLC, Case No. 22CV-05189, Marion County Circuit Court. This is a wrongful termination claim filed on February 7, 202

1. Property and Easement Disputes. Cascadia's wind farm operations in Washington require extensive easement and right-of-way agreements with neighboring landowners for access roads, transmission lines, and turbine setback areas. The rural settings of these facilities and the ongoing nature of wind farm operations give rise to periodic disputes with neighboring property owners. (a) *Hargrove Family Trust v. Cascadia W

2. Tax Assessment Appeals. Property tax valuations for wind farm facilities are a recurring source of administrative and judicial proceedings, as county assessors and taxpayers frequently disagree on the appropriate valuation methodology for capital-intensive renewable energy assets, including the treatment of production tax credits ("PTCs"), depreciation schedules, and the income and cost approaches to value. (a) Ki

1. Environmental Citizen Suits. (a) *Columbia Basin Conservation Alliance v. Cascadia Hydro Operations, LLC*, Case No. 3:21-cv-01874-MO, U.S. District Court for the District of Oregon (Portland Division). This action was filed on November 12, 2021 by the Columbia Basin Conservation Alliance ("CBCA"), a regional environmental non-governmental organization, against Cascadia Hydro Operations, LLC, the operator of the Sa

2. FERC-Related Proceedings. No litigation proceedings pending in federal court arise directly from FERC regulatory matters. As noted above, Cascadia anticipates filing a FERC §203 application (FERC Docket Number EC22-143-000) for approval of the transfer of Cascadia's hydroelectric licenses in connection with the Transaction. This filing is anticipated to occur on or about October 19, 2022, which post-dates this mem

3. Intellectual Property Claims. No pending intellectual property litigation involving any Cascadia Entity was identified in our review of federal and state court dockets. A detailed analysis of the Cascadia Entities' intellectual property portfolio, including trademarks, patents, trade secrets, and software licenses, is provided in the companion intellectual property due diligence memorandum (to be dated August 23,

IV. Administrative and Regulatory Proceedings A. Oregon Public Utility Commission (OPUC) Cascadia Hydro Operations, LLC holds certificates of public convenience and necessity from the OPUC for its Oregon hydroelectric generating facilities that sell power at regulated rates. Cascadia is therefore subject to ongoing regulatory oversight by the OPUC, including rate case proceedings, compliance reviews, and reporting ob

V. Threatened Litigation and Pre-Suit Demands A. Demand Letters and Pre-Litigation Notices Our review of Cascadia's correspondence files and Data Room documents identified three demand letters or pre-litigation notices received by Cascadia within the twelve months preceding the date of this memorandum that have not ripened into filed proceedings: (a) Environmental Contamination Allegation — Bonneville Heights Landown