Contract analysis

I. Executive Summary The purpose of this memorandum is to review and assess the community right-to-know reporting obligations of Allegheny Chemical Coatings, Inc. ("ACC" or the "Target") at the McKeesport Main Plant (the "Facility") under the Emergency Planning and Community Right-to-Know Act ("EPCRA"), 42 U.S.C. §§ 11001–11050, in connection with the proposed acquisition of ACC by Crestline Packaging Solutions LLC (

II. Scope and Methodology A. Scope of Review This review is limited to the McKeesport Main Plant, located at 2200 Iron Works Boulevard, McKeesport, PA 15132, Allegheny County, Pennsylvania (the "Facility"). The Facility serves as ACC's corporate headquarters and principal manufacturing site. It is the largest of ACC's four operating locations and is the site at which ACC conducts the predominant share of its specialt

1. Tier II Emergency and Hazardous Chemical Inventory Reports for calendar years 2017 through 2021 (five years of filings), as filed with the Allegheny County LEPC, the Pennsylvania SERC (via the PA DEP electronic submission system), and the McKeesport Fire Department. These reports were produced as Bates-stamped documents ACC-ENV-001247 through ACC-ENV-001386.

2. TRI Form R Reports for calendar years 2017 through 2021 (five years of filings), as filed with the United States Environmental Protection Agency ("EPA") and the Pennsylvania Department of Environmental Protection ("PA DEP"). These reports were produced as Bates-stamped documents ACC-ENV-001387 through ACC-ENV-001502.

3. Safety Data Sheets ("SDS") for the principal chemicals used and stored at the Facility, including toluene, xylene (mixed isomers), methyl ethyl ketone ("MEK"), ethylbenzene, various epoxy resin formulations, chromium-containing pigments, and lead-containing pigments. SDS documents were produced as Bates-stamped documents ACC-ENV-001503 through ACC-ENV-001647.

4. Correspondence with the Allegheny County LEPC, EPA Region III, and PA DEP regarding EPCRA matters, including emergency planning notifications, Section 302 notifications, and any inquiries or requests for information. Produced as Bates-stamped documents ACC-ENV-001648 through ACC-ENV-001672.

5. Internal ACC environmental compliance records, including internal chemical inventory tracking spreadsheets, EHS compliance calendars, and internal audit checklists, provided by Carl Johannsen, EHS Manager, ACC. Produced as Bates-stamped documents ACC-ENV-001673 through ACC-ENV-001725.

6. TerraVerde Environmental Consulting LLC Phase I Environmental Site Assessment dated August 15, 2022 (the "Phase I ESA"), with particular attention to the regulatory database review section (Section 6.0 of the Phase I ESA), which includes results from Penrose Solutions ("EDR") database searches encompassing EPA TRI, RCRIS, CERCLIS, state spill, and related databases. Produced as Bates-stamped documents ACC-ENV-0000

III. EPCRA Sections 302–303: Emergency Planning A. Extremely Hazardous Substances (EHS) Present at the Facility As an initial step in our review of the Facility's EPCRA obligations, we examined the chemical inventory at the McKeesport Main Plant — as reflected in the SDS library, Tier II reports, and internal chemical inventory records — against the EPA list of 355 Extremely Hazardous Substances set forth in Appendic

IV. EPCRA Section 304: Emergency Release Notification A. Reporting Obligations EPCRA Section 304 requires the owner or operator of a facility to provide immediate notification to the applicable LEPC and the SERC in the event of a release of an EHS or a CERCLA hazardous substance in an amount equal to or exceeding the applicable reportable quantity ("RQ"). The notification must be provided as soon as practicable and m

1. June 14, 2017 — Xylene Release from Ruptured Transfer Hose. Approximately 50 gallons of xylene were released from a ruptured transfer hose during a solvent transfer operation in the Building C mixing area. The release was contained within the secondary containment system (a concrete containment dike surrounding the bulk solvent transfer station), and no release to the external environment occurred. The incident wa

2. February 3, 2020 — Epoxy Resin Hardener Release to Sanitary Sewer. Approximately 120 gallons of epoxy resin hardener were released to the warehouse floor in Building B. The released material entered a floor drain connected to the municipal sanitary sewer system. The incident was reported to PA DEP and the Allegheny County Health Department. PA DEP assessed a civil penalty of $4,500 in connection with the unauthori

V. EPCRA Sections 311–312: Tier II Reporting A. Overview of Tier II Obligations EPCRA Section 311 requires the owner or operator of a facility that is required to prepare or have available an SDS for a hazardous chemical under the Occupational Safety and Health Act ("OSHA") to submit the SDS (or a list of such chemicals) to the LEPC, SERC, and local fire department if the chemical is present at the facility at or abo

VI. EPCRA Section 313: Toxic Release Inventory (TRI) Reporting A. Overview of TRI Obligations EPCRA Section 313 requires covered facilities to file annual TRI Form R reports (or, where applicable, Form A certification statements for lower-quantity releases) with the EPA and the relevant state environmental agency. TRI reporting is intended to provide the public and government agencies with information about releases

1. Tier II inventory data. The quantities of toluene and xylene stored and used at the Facility, as reported on the Tier II forms, are consistent with the release quantities reported on the TRI Form R filings. The volume of solvents maintained in inventory (maximum daily amounts of approximately 45,000 pounds of toluene and 32,000 pounds of xylene) is of a magnitude that would be expected to generate annual releases

2. Title V permit emission limits and compliance certifications. The TRI-reported air releases for toluene and xylene are within the Facility's permitted emission rates under Title V Operating Permit No. TV-0383-0125. Annual compliance certifications filed by ACC with PA DEP confirm that the Facility has operated within its permitted emission limits during the review period. No exceedances of permit limits have been

3. RCRA hazardous waste manifests. Spent solvent quantities generated at the Facility and shipped off-site for recycling or disposal, as documented on RCRA hazardous waste manifests (reviewed in the RCRA Compliance Review Memorandum), are consistent with the usage volumes that would generate the reported TRI releases. The volumes of toluene- and xylene-bearing waste streams shipped off-site, combined with quantities

4. Combined HAP emissions. ACC's combined HAP emissions are reported at 38.2 tons per year. Toluene and xylene are both listed HAPs under Section 112 of the Clean Air Act. The TRI-reported total releases for these two chemicals (12,400 pounds of toluene + 8,700 pounds of xylene = 21,100 pounds, or approximately 10.55 tons) represent a substantial portion — approximately 27.6% — of the Facility's total combined HAP em

VII. EPCRA Enforcement History A. EPA and PA DEP Enforcement Review We conducted a comprehensive review of EPCRA enforcement history at the McKeesport Main Plant using the following sources: • EPA Enforcement and Compliance History Online ("ECHO") database, which compiles federal and state enforcement data for regulated facilities. • PA DEP compliance and enforcement records available through the eFACTS database and

VIII. Implications for the Proposed Transaction A. Stock Purchase Structure Considerations The proposed transaction is structured as a stock purchase, pursuant to which Crestline will acquire 100% of the outstanding common stock of ACC. Because the transaction involves a change of ownership at the shareholder level rather than an asset purchase, ACC will remain the legal entity that owns and operates the McKeesport M

1. Tier II filing continuity. The CY 2022 Tier II report will be due on March 1, 2023. Depending on the transaction timeline (currently anticipated closing in Q4 2022 or Q1 2023), responsibility for preparing and filing this report may fall to Crestline's management team. Patricia Okonkwo, VP of EHS, should coordinate with Carl Johannsen to ensure timely preparation and filing.

2. TRI Form R filing continuity. The CY 2022 TRI Form R reports for toluene and xylene will be due on July 1, 2023. Similar coordination between Crestline's EHS team and ACC's existing EHS staff will be required.

3. Thermal oxidizer upgrade. If the pending Title V permit modification for the new thermal oxidizer on Line 4 is approved by PA DEP and the oxidizer becomes operational during or after CY 2022, updated TRI reporting should reflect the resulting changes in release quantities. The installation of additional VOC control equipment is expected to reduce toluene and xylene air emissions, which would correspondingly reduce

4. Integration into Crestline EHS systems. The McKeesport Facility's EPCRA reporting obligations should be incorporated into Crestline's existing EHS compliance management systems, including compliance calendars, internal audit protocols, and reporting workflows. This integration will help ensure that reporting deadlines are not missed and that chemical inventory data continues to be accurately tracked and reported.

IX. Conclusions and Recommendations A. Conclusions. Based on our review of the documents and records described in Section II above and our analysis set forth in Sections III through VIII of this memorandum, we reach the following conclusions:

1. ACC has filed Tier II Emergency and Hazardous Chemical Inventory Reports with the Allegheny County LEPC, the Pennsylvania SERC, and the McKeesport Fire Department for each of the five calendar years reviewed (CY 2017, CY 2018, CY 2019, CY 2020, and CY 2021). All filings appear to have been timely submitted by the March 1 statutory deadline. The chemical inventory data reported on the Tier II forms is substantively

2. ACC has filed TRI Form R reports for toluene (total releases of 12,400 pounds in CY 2021) and xylene (total releases of 8,700 pounds in CY 2021) for each of the five calendar years reviewed. All filings appear to have been timely submitted by the July 1 statutory deadline. Reported release quantities are consistent with Facility operations, Title V permit emission limits, RCRA hazardous waste generation data, and

3. No EPCRA enforcement actions, administrative penalties, notices of violation, administrative orders, consent agreements, or citizen suit notices under EPCRA Section 326 have been identified at any time during or prior to the review period at the McKeesport Main Plant. ACC has a clean EPCRA enforcement history at this Facility.

4. EPCRA compliance at the McKeesport Main Plant does not present a material risk or liability concern for the proposed acquisition of ACC by Crestline. The Facility's reporting obligations are current, substantively accurate, and consistently met. No conditions have been identified that would give rise to potential EPCRA penalties, remedial obligations, or third-party claims.

5. Section 304 emergency release notifications appear to have been made for both reportable spill incidents identified during the review period — the June 14, 2017 xylene release from a ruptured transfer hose (contained within secondary containment) and the February 3, 2020 epoxy resin hardener release to the sanitary sewer. Both incidents were reported to the Allegheny County LEPC, and the documentation is consisten

1. Stock Purchase Agreement representations. The final Stock Purchase Agreement should include a robust EPCRA compliance representation and warranty, without knowledge qualifiers, confirming that ACC has filed all required Tier II and TRI reports, that such filings are current, timely, and accurate in all material respects, and that ACC has not received any notice of violation, enforcement action, or citizen suit not

2. CY 2022 filing status. Crestline should confirm with Carl Johannsen, ACC's EHS Manager, that the CY 2022 Tier II report and TRI Form R reports are being prepared on a timely basis and are on track for filing by their respective deadlines (March 1, 2023 for Tier II; July 1, 2023 for TRI). This confirmation is particularly important given the anticipated transaction timeline, which may result in a change in manageme

3. Emergency coordinator designation. Post-closing, Crestline should update the facility emergency coordinator designation with the Allegheny County LEPC as appropriate, particularly if Mr. Johannsen's role or employment status changes in connection with the transaction or post-closing integration.

4. EHS compliance systems integration. Crestline should incorporate the McKeesport Facility's EPCRA reporting obligations — including Tier II reporting, TRI Form R reporting, Section 302 notifications, and Section 304 emergency release notification procedures — into Crestline's existing EHS compliance management systems. This integration should include addition of EPCRA filing deadlines to Crestline's corporate compl

5. Incorporation into comprehensive diligence summary. This memorandum should be incorporated into the Comprehensive Environmental Diligence Summary Memorandum currently being prepared by Calderwood & Harkness (draft dated October 22, 2022, currently incomplete pending receipt and analysis of Phase II subsurface investigation results for the Clarksburg, West Virginia facility). The conclusions and recommendations of

X. Limitations This memorandum is subject to the following limitations and qualifications: This review is based on records and information made available through Seller's counsel, Hargrove, Dalton & Speer LLP (Franklin Speer, Megan Trask), ACC's internal files as produced through the virtual data room, publicly available EPA and PA DEP databases (including the EPA ECHO database, TRI Explorer, and PA DEP eFACTS), and