1011-00005 · Meridian Consumer Brands LLC · Diligence

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ATTORNEY WORK PRODUCT / PRIVILEGED & CONFIDENTIAL

MEMORANDUM

July 8, 2022

TO: Andrew Fitzpatrick, Lead Associate, Calderwood & Harkness LLP Sandra Tung, Responsible Partner, Calderwood & Harkness LLP

FROM: Naomi Petersen, Working Associate, Calderwood & Harkness LLP

RE: Due Diligence Memorandum — Corporate & Organizational Review of Briarwood Home Essentials, Inc.

MATTER: Meridian Consumer Brands LLC — Proposed Acquisition of CleanLeaf and PureHaven Product Lines from Briarwood Home Essentials, Inc.

MATTER NO.: 1011-00005

REVIEWED BY: Andrew Fitzpatrick

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I. EXECUTIVE SUMMARY

This memorandum summarizes the preliminary findings from Calderwood & Harkness LLP's corporate and organizational due diligence review of Briarwood Home Essentials, Inc. ("Briarwood" or "BHE") in connection with the proposed acquisition by our client, Meridian Consumer Brands LLC ("Meridian" or "MCB"), of Briarwood's CleanLeaf and PureHaven consumer product lines (collectively, the "Acquired Assets") for a proposed purchase price of $95,000,000 (the "Transaction").

The Transaction is structured as an asset purchase pursuant to a Letter of Intent dated March 28, 2022 (the "LOI"), executed by and between Meridian and Briarwood. Formal due diligence commenced on June 14, 2022, following the execution of a mutual non-disclosure agreement and the establishment of a virtual data room. Data room access was granted via the Pemberton Systems platform under Project Code BHE-CleanLeaf-2022 (the "Data Room"). Calderwood & Harkness LLP has been engaged by Meridian to conduct legal due diligence across all applicable workstreams, of which this memorandum addresses the corporate and organizational workstream.

Overall Assessment. Based on our review of the materials made available as of the date of this memorandum, Briarwood appears to be a validly formed and existing corporation organized under the laws of the State of Ohio and in good standing with the Ohio Secretary of State. The capitalization structure is straightforward: Briarwood has a single class of common shares authorized, all of which are held by a single shareholder, Malcolm Greer. Briarwood has no subsidiaries, joint ventures, or affiliated entities. Authority to consummate the Transaction appears to be vested in Mr. Greer, who serves as both the sole shareholder and sole director of Briarwood. The retained division of Briarwood's business — the Commercial Janitorial Services Division — is operationally separate from the Acquired Assets, though both divisions are housed within a single corporate entity, which necessitates careful delineation in the Asset Purchase Agreement ("APA") schedules.

Certain follow-up items remain open as of the date of this memorandum, including confirmation of foreign qualification status and completion of outstanding document requests directed to seller's counsel, Caldwell, Pruitt & Shaw LLP. These items are detailed in Section VIII below. None of the outstanding items are expected to present material impediments to the Transaction based on information received to date, but final conclusions are subject to receipt and review of all requested materials.

II. SCOPE AND METHODOLOGY

A. Scope of Review

The scope of this memorandum is limited to the corporate and organizational due diligence review of Briarwood Home Essentials, Inc. This review encompasses the following subject matter areas:

• Formation and corporate status, including charter documents and good standing;

• Capitalization and ownership structure, including the stock ledger, shareholder records, and any outstanding equity instruments;

• Board of directors composition, officer appointments, and corporate governance;

• Subsidiary and affiliate structure, including any joint ventures or minority equity investments;

• Divisional structure, with particular attention to the distinction between the Acquired Assets (CleanLeaf and PureHaven product lines) and the Retained Business (Commercial Janitorial Services Division); and

• Authority of the relevant corporate actors to consummate the Transaction.

This memorandum does not address intellectual property, material contracts, employee and labor matters, environmental matters, litigation, tax, regulatory compliance, insurance, or real property and leases, each of which is the subject of a separate due diligence workstream and corresponding memorandum. Cross-references to other workstreams are provided where relevant.

B. Documents Reviewed

The following categories of documents were reviewed in connection with the preparation of this memorandum:

1. Articles of Incorporation of Briarwood Home Essentials, Inc., including all amendments thereto through the date of this review;

2. Code of Regulations of Briarwood Home Essentials, Inc. (the Ohio equivalent of corporate bylaws);

3. Certificate of Good Standing issued by the Ohio Secretary of State, dated June 22, 2022;

4. Shareholder records and stock ledger of Briarwood Home Essentials, Inc.;

5. Resolutions of the Board of Directors of Briarwood Home Essentials, Inc. (available resolutions through date of Data Room access);

6. Written consents and resolutions of the sole shareholder of Briarwood Home Essentials, Inc. (to the extent made available);

7. Records of officer appointments, including board resolutions appointing current officers;

8. Annual reports filed with the Ohio Secretary of State;

9. Organizational chart of Briarwood Home Essentials, Inc. provided by Briarwood management; and

10. Such other documents and information as were made available in the Data Room as described below.

C. Data Room References

All materials reviewed were obtained from the Pemberton Systems virtual Data Room established under Project Code BHE-CleanLeaf-2022. The reviewed materials were located in the following Data Room folders:

Document indices for each folder were reviewed and cross-referenced against our due diligence request list to identify outstanding items, as further discussed in Section VIII.

D. Limitations. This memorandum is based solely on documents and information made available to Calderwood & Harkness LLP as of the date hereof. Our review is necessarily limited by the completeness and accuracy of the materials provided. Certain items on the due diligence request list dated June 14, 2022 (transmitted to Caldwell, Pruitt & Shaw LLP, attention Rachel Underwood and David Soo, seller's counsel) remain outstanding as noted in Section VIII below. The conclusions and assessments set forth in this memorandum are preliminary in nature and may be revised upon receipt and review of additional materials. This memorandum does not constitute a legal opinion and should not be relied upon as such.

III. ENTITY FORMATION AND STATUS

A. Formation. Briarwood Home Essentials, Inc. is a corporation organized under the laws of the State of Ohio. The company was founded in 2004 by Malcolm Greer and has been in continuous operation since its formation. The following key formation and identification details have been confirmed through our review:

We reviewed the original Articles of Incorporation of Briarwood Home Essentials, Inc. as filed with the Ohio Secretary of State in 2004, together with all amendments thereto through the date of this review. The Articles of Incorporation were filed in the form customary for Ohio corporations and set forth the following principal provisions:

(a) Name. The name of the corporation is "Briarwood Home Essentials, Inc."

(b) Purpose. The corporation is formed for the purpose of engaging in any lawful act or activity for which corporations may be formed under the Ohio Revised Code.

(c) Authorized Shares. The corporation is authorized to issue 10,000 shares of common stock, no par value per share, constituting a single class of common shares. No preferred stock or other class of equity securities is authorized under the Articles of Incorporation.

(d) Incorporator. Malcolm Greer is identified as the sole incorporator.

(e) Initial Registered Agent. The Articles designate an initial registered agent and registered office address in the State of Ohio (subsequently updated as described in Section III.C below).

Based on our review, the Articles of Incorporation have been amended on two occasions: (i) a 2007 amendment updating the registered agent designation, and (ii) a 2012 amendment adopting an updated provision regarding director indemnification consistent with then-current Ohio Revised Code provisions. Neither amendment altered the authorized share structure, the corporate purpose, or any other material organizational provision. We have requested confirmation from Caldwell, Pruitt & Shaw LLP that the amendments reviewed in the Data Room represent the complete set of all amendments to the Articles of Incorporation (see Section VIII, Item 1).

B. Good Standing

We obtained and reviewed a Certificate of Good Standing issued by the Ohio Secretary of State with respect to Briarwood Home Essentials, Inc., dated June 22, 2022. The Certificate confirms that Briarwood is in good standing under Ohio law and is current on all franchise tax filings and annual reports required to be filed with the Ohio Secretary of State as of the date of the Certificate.

Based on our review of publicly available records maintained by the Ohio Secretary of State's office, we identified no pending dissolution proceedings, revocation of corporate authority, or administrative actions against Briarwood. The corporation's status appears to be fully active and compliant with Ohio statutory requirements.

We note that the Certificate of Good Standing was issued approximately sixteen days prior to the date of this memorandum. It is customary to obtain an updated good standing certificate within ten business days prior to closing. We recommend that an updated Certificate of Good Standing be obtained as a condition to closing under the APA, and we will include this as a closing deliverable in our initial draft of the APA closing conditions.

C. Registered Agent

Briarwood's current registered agent in the State of Ohio is Ohio Registered Agent Services, Inc., a professional registered agent service company. The registered office address on file with the Ohio Secretary of State is:

Ohio Registered Agent Services, Inc. 50 West Broad Street Columbus, OH 43215

The registered agent designation is current and active per Ohio Secretary of State records as of the date of this memorandum. The registered agent designation was updated in 2007 by amendment to the Articles of Incorporation, replacing the original registered agent designation that named Malcolm Greer individually at his residential address. The use of a professional registered agent service is consistent with standard corporate practice and does not raise any concerns.

D. Principal Place of Business

Briarwood's principal place of business and corporate headquarters is located at the following address:

1175 Creekside Drive, Suite 400 Columbus, OH 43215

This headquarters facility serves as the administrative office for both the Consumer Product Lines (Acquired Assets) and the Commercial Janitorial Services Division (Retained Business). It is our understanding, based on the organizational chart and management representations provided through the Data Room, that certain administrative personnel at the headquarters location serve both divisions, including accounting, human resources, and executive management functions.

We note that the headquarters lease is designated as an excluded asset under the LOI and will be retained by Briarwood as part of the Retained Business. The allocation of shared administrative functions and personnel between the Acquired Assets and the Retained Business will need to be carefully addressed in the Transition Services Agreement ("TSA") that is expected to be negotiated as an ancillary agreement to the APA. This matter will be further addressed in the employee and labor due diligence memorandum and in connection with the drafting of the TSA.

IV. CAPITALIZATION AND OWNERSHIP

A. Authorized Capital

As described in Section III.A above, the Articles of Incorporation of Briarwood Home Essentials, Inc. authorize the issuance of 10,000 shares of common stock, no par value per share. This constitutes a single class of common shares. The Articles do not authorize the issuance of preferred stock or any other class or series of equity securities. No amendments to the Articles have been filed that would alter the authorized share structure.

The single-class common stock structure is typical of closely held Ohio corporations and is consistent with the sole-shareholder ownership described below.

B. Outstanding Shares and Ownership

Based on our review of the stock ledger maintained in Data Room Folder 1.3, Malcolm Greer is the sole shareholder of Briarwood Home Essentials, Inc. Mr. Greer holds 1,000 shares of common stock, representing 100% of the issued and outstanding shares of the corporation. The stock ledger reflects that these shares were originally issued to Mr. Greer at the time of incorporation in 2004. No transfers of shares have been recorded in the stock ledger at any time since the date of original issuance.

We reviewed the stock ledger for completeness and consistency. The ledger is maintained in a standard bound stock ledger book format and contains the following entries:

No additional entries appear in the stock ledger. There are no cancelled certificates, no transfers, and no notation of any liens, pledges, or encumbrances on the shares.

We have not identified any stock option plans, stock incentive plans, phantom equity arrangements, stock appreciation rights, warrants, convertible notes, convertible preferred instruments, or any other equity-linked instruments or rights outstanding. No agreements granting any person the right to acquire shares of Briarwood have been located in the Data Room. We have requested written confirmation from Briarwood and its counsel that no such instruments or arrangements exist (see Section VIII, Item 2).

C. Shareholder Agreements

Given the sole-shareholder structure, there are no shareholders' agreements, voting agreements, voting trusts, buy-sell agreements, or other arrangements among shareholders. We have not identified any preemptive rights, rights of first refusal, tag-along rights, drag-along rights, co-sale rights, or other restrictions on the transfer of shares, whether set forth in the Articles of Incorporation, the Code of Regulations, or any separate agreement.

The absence of shareholder agreements and transfer restrictions is consistent with a single-shareholder closely held corporation and simplifies the Transaction from a consent and approval perspective.

D. Implications for the Transaction

The sole-shareholder structure of Briarwood has several favorable implications for the Transaction:

(a) Simplified Approval Process. As the sole shareholder and sole director of Briarwood, Malcolm Greer has the authority to approve and authorize the Transaction without the need for a shareholder vote involving other parties, without triggering any tag-along, drag-along, or co-sale rights, and without the need to obtain consent from or provide notice to any co-shareholders.

(b) Single Consent Required. A single written consent of the sole shareholder, together with a corresponding board resolution adopted by Mr. Greer as sole director, will be sufficient to authorize the execution and delivery of the APA and the consummation of the Transaction, subject to the "substantially all assets" analysis discussed in Section V.C below.

(c) Consistency with Non-Competition Covenant. Mr. Greer's role as the proposed party to the Non-Competition and Non-Solicitation Agreement (which, per the LOI, contemplates a four-year term applicable to consumer products only) is consistent with his position as the sole owner and principal operator of Briarwood. His willingness to execute this agreement is a key commercial term of the Transaction and is appropriately tied to his ownership and operational involvement in the Consumer Product Lines.

(d) No Minority Shareholder Issues. There are no minority shareholders whose interests must be considered, no minority consent rights, and no risk of appraisal rights claims by dissenting shareholders. This eliminates a category of transaction risk that is frequently present in closely held corporation acquisitions.

V. BOARD OF DIRECTORS AND OFFICERS

A. Board of Directors

Briarwood's Code of Regulations (the Ohio equivalent of corporate bylaws) provides for a board of directors responsible for the management and direction of the corporation's business and affairs. The Code of Regulations permits the board to consist of one or more directors, with the number to be fixed by resolution of the shareholders or the board from time to time.

As of the date of this memorandum, the board of directors of Briarwood consists of a single director: Malcolm Greer. Mr. Greer has served as the sole director of Briarwood since the corporation's formation in 2004. There are no independent directors, no advisory board members, and no committees of the board (including no audit committee, compensation committee, or governance committee). The absence of independent directors and board committees is typical of sole-shareholder closely held corporations and does not raise governance concerns in the context of the Transaction.

We reviewed available board resolutions uploaded to Data Room Folder 1.2. The resolutions document routine corporate actions, including the annual election of officers, authorization of banking relationships, approval of lease agreements, and other matters in the ordinary course of business. The resolutions are consistently executed by Malcolm Greer as sole director and appear to be in proper form under Ohio law. We did not identify any resolutions relating to the Transaction or to any prior sale or disposition of material assets.

B. Officers. Based on our review of the corporate records, including board resolutions appointing officers and the organizational chart provided by Briarwood management, the following individuals currently serve as officers of Briarwood Home Essentials, Inc.:

Mr. Greer holds multiple officer positions in addition to his role as sole director, which is common in closely held corporations. Janet Tsao serves as Vice President of Operations and, based on the organizational chart, has operational responsibility over both the Consumer Product Lines and the Commercial Janitorial Services Division, though the day-to-day management of each division is handled by separate division managers reporting to Ms. Tsao.

All officer appointments were made by resolution of the board of directors, and copies of the appointing resolutions were reviewed in the Data Room. The resolutions are in standard form and do not contain any unusual conditions, limitations on authority, or special compensation arrangements beyond those expected for positions of this nature.

C. Authority to Execute Transaction Documents

As sole director and President of Briarwood, Malcolm Greer has authority under the Code of Regulations and applicable Ohio law to execute the APA and ancillary transaction documents on behalf of the corporation. The Code of Regulations grants the President the power to execute contracts, deeds, and other instruments on behalf of the corporation, subject to any specific restrictions imposed by the board of directors. We identified no such restrictions in the reviewed resolutions or in the Code of Regulations.

Notwithstanding the foregoing, we recommend the following steps to ensure that proper corporate authority is documented for the Transaction:

(a) Board Resolution. The APA should require, as a condition to closing, delivery of a certified copy of a resolution of the Board of Directors of Briarwood (i.e., a resolution adopted by Malcolm Greer as sole director) specifically authorizing the sale of the Acquired Assets, the execution and delivery of the APA and all ancillary documents, and the consummation of the transactions contemplated thereby. A standard form of such resolution should be attached to the APA or included in the closing conditions.

(b) Sole Shareholder Written Consent. Similarly, the APA should require delivery of a written consent of the sole shareholder of Briarwood (i.e., Malcolm Greer) approving and ratifying the Transaction. This written consent serves as the functional equivalent of a shareholder vote and is the customary mechanism for shareholder approval in sole-shareholder corporations under Ohio law.

Ohio Revised Code — Sale of Substantially All Assets. We note that Section 1701.76 of the Ohio Revised Code requires that a sale, lease, exchange, or other disposition of all, or substantially all, of the assets of a corporation (other than in the usual and regular course of business) must be authorized by the affirmative vote or written consent of the holders of at least two-thirds of the voting power of the corporation. We recommend that the Transaction team conduct a more detailed analysis of whether the CleanLeaf and PureHaven product lines, which generated FY2021 revenue of approximately $68,000,000 and FY2021 EBITDA of approximately $11,200,000, constitute "substantially all" of Briarwood's assets within the meaning of Section 1701.76. This analysis will require consideration of the total assets of Briarwood, including the Retained Business (Commercial Janitorial Services Division), and should take into account both quantitative factors (percentage of total revenue, total assets, and total EBITDA attributable to the Acquired Assets) and qualitative factors (whether the Retained Business is sufficient to enable Briarwood to continue its corporate existence and operations in a meaningful way).

Even if the Transaction is determined to constitute a sale of "substantially all" of Briarwood's assets, compliance with Section 1701.76 is straightforward in the context of a sole-shareholder corporation, as Mr. Greer's written consent would satisfy the two-thirds voting power requirement. Nevertheless, we recommend that the analysis be completed and documented, and that the closing deliverables include a certificate from Mr. Greer confirming compliance with all applicable statutory requirements.

VI. SUBSIDIARY AND AFFILIATE STRUCTURE

A. Subsidiaries. Based on our review of the corporate records, organizational chart, annual reports, and other materials made available in the Data Room, Briarwood Home Essentials, Inc. has no subsidiaries. The corporation does not own, directly or indirectly, any equity interest in any other corporation, limited liability company, partnership, joint venture, or other business entity. All of Briarwood's operations — including both the Consumer Product Lines (Acquired Assets) and the Commercial Janitorial Services Division (Retained Business) — are conducted directly by Briarwood Home Essentials, Inc. as a single corporate entity.

We identified no joint venture agreements, partnership agreements, or other arrangements pursuant to which Briarwood participates in any collaborative business venture with any third party. No minority equity investments by Briarwood in other entities were identified. The organizational chart provided by Briarwood management is consistent with this finding and depicts a single corporate entity without any subsidiary or affiliate branches.

B. Affiliates. Other than Malcolm Greer in his individual capacity as sole shareholder, sole director, and President of Briarwood, we identified no affiliated entities, management companies, holding companies, family trusts, or other related-party entities that have any ownership interest in, management authority over, or contractual relationship with Briarwood. Mr. Greer does not appear to conduct any business activities through any entity other than Briarwood, based on the information reviewed to date, although we have not independently verified this and recommend that representations to this effect be included in the APA.

The absence of a holding company or other intermediate ownership structure simplifies the Transaction from a structural and approval perspective and eliminates the need for upstream consents or approvals from parent entities.

C. Divisional Structure — Retained Business vs. Acquired Assets

Briarwood operates two distinct business lines within a single corporate entity. This divisional structure is central to the Transaction and warrants careful attention in the drafting of the APA and its schedules.

Consumer Product Lines (Acquired Assets). The first division encompasses Briarwood's consumer-facing product business, which consists of two branded product lines:

(i) CleanLeaf. The CleanLeaf brand encompasses a line of eco-friendly home cleaning products, including all-purpose cleaners, dish soaps, laundry detergents, and specialty cleaning solutions. The CleanLeaf line is distributed through major national retailers and direct-to-consumer e-commerce channels.

(ii) PureHaven. The PureHaven brand encompasses a line of natural personal care products, including hand soaps, body washes, lotions, and related products. The PureHaven line is similarly distributed through national retail and e-commerce channels.

Together, the CleanLeaf and PureHaven brands encompass approximately 142 active SKUs. For the fiscal year ended December 31, 2021, the Consumer Product Lines generated revenue of approximately $68,000,000 and EBITDA of approximately $11,200,000. As of June 30, 2022, accounts receivable attributable to the Consumer Product Lines totaled approximately $9,700,000.

The Acquired Assets include, in addition to the CleanLeaf and PureHaven brands and associated intellectual property, the following categories of assets: (a) inventory related to the Consumer Product Lines; (b) accounts receivable attributable to the Consumer Product Lines ($9,700,000 as of June 30, 2022); (c) equipment used in the manufacture and distribution of consumer products; (d) intellectual property associated with the CleanLeaf and PureHaven brands, including trademarks, trade names, formulations, and packaging designs; (e) twenty-three (23) customer contracts related to the Consumer Product Lines; (f) the Marysville manufacturing facility lease (subject to landlord consent to assignment); and (g) the West Jefferson distribution center (owned by Briarwood and to be conveyed as part of the Acquired Assets).

Commercial Janitorial Services Division (Retained Business). The second division is Briarwood's commercial janitorial services business, which provides contract janitorial and facilities maintenance services to commercial clients in the greater Columbus, Ohio metropolitan area. This division will not be part of the asset purchase and will be retained by Briarwood post-closing. The Commercial Janitorial Services Division operates from the Columbus headquarters and utilizes separate equipment, personnel, and customer relationships from the Consumer Product Lines.

Observation. The two divisions are not separately incorporated and are not held through subsidiaries or otherwise legally separated. Both divisions operate within the single corporate entity, Briarwood Home Essentials, Inc. This structure is the primary reason the Transaction is structured as an asset purchase (rather than a stock acquisition): the asset purchase structure enables Meridian to acquire only the Consumer Product Lines and related assets while leaving the Retained Business in place within Briarwood.

Risk Flag — Asset Delineation. Because both divisions operate within a single legal entity, careful and precise delineation of Acquired Assets versus Excluded Assets in the APA schedules is critical to the success of the Transaction. Areas requiring particular attention include:

(a) Shared Assets. Certain assets may be used by both divisions, including shared information technology systems, shared administrative equipment at the Columbus headquarters, and potentially shared vehicles or other tangible assets. These shared assets must be identified, and a determination must be made as to whether each shared asset will be included in the Acquired Assets, retained by Briarwood, or made available through the Transition Services Agreement.

(b) Shared Contracts. Certain contracts — including insurance policies, vendor agreements, and potentially banking relationships — may cover both divisions. These contracts will need to be reviewed to determine whether they can be partially assigned, whether new standalone contracts will need to be established for the Acquired Assets, or whether the existing contracts will be addressed through the TSA during a transition period.

(c) Intercompany Allocations. The two divisions likely share certain overhead costs, including rent at the Columbus headquarters, administrative personnel costs, insurance premiums, and technology expenses. Historical intercompany allocation methodologies should be reviewed to ensure that the financial statements and representations relating to the Consumer Product Lines accurately reflect the costs of operating those businesses on a standalone basis. This matter will be further addressed in the financial due diligence workstream.

(d) Employee Allocation. The LOI contemplates the transfer of approximately 186 employees from Briarwood to Meridian in connection with the Transaction. A detailed organizational chart distinguishing Consumer Product Line personnel from Commercial Janitorial Services Division personnel has been requested but remains outstanding (see Section VIII, Item 5). Proper identification and allocation of transferring employees is essential for workforce planning, benefits transition, and compliance with applicable employment laws, including WARN Act considerations.

The Buyer's initial draft of the APA schedules is targeted for September 15, 2022. We recommend that the drafting team give priority to the Acquired Assets and Excluded Assets definitions and schedules, and that these schedules be developed in close coordination with Meridian's financial and operational advisors to ensure completeness and accuracy.

VII. REAL PROPERTY AND FACILITIES — ORGANIZATIONAL NEXUS

A separate due diligence memorandum addressing real property and leases will be prepared by the Calderwood & Harkness real property team and is forthcoming. However, given the relevance of certain real property matters to the corporate and organizational analysis, we provide the following preliminary cross-references for context.

Briarwood's operations involve three principal facilities, each of which has a distinct treatment under the proposed Transaction:

Manufacturing Facility — Marysville, Ohio. Briarwood operates a manufacturing facility located at 2800 Industrial Parkway, Marysville, OH 43040. This facility is used for the production of CleanLeaf and PureHaven consumer products and is included in the Acquired Assets. The facility is leased by Briarwood from Buckeye Industrial Properties LLC pursuant to a commercial lease agreement. Assignment of this lease to Meridian will require the prior written consent of the landlord, Buckeye Industrial Properties LLC. The terms of the lease, including any assignment provisions, change-of-control clauses, and consent requirements, will be addressed in detail in the real property and leases due diligence memorandum. We flag this as a key closing deliverable item: landlord consent to assignment must be obtained prior to or at closing.

Distribution Center — West Jefferson, Ohio. Briarwood owns a distribution center located at 500 Commerce Boulevard, West Jefferson, OH 43162. This facility is used for the warehousing and distribution of Consumer Product Line inventory and is included in the Acquired Assets. Because this facility is owned by Briarwood (rather than leased), it will be conveyed to Meridian by deed as part of the Acquired Assets. Title insurance, survey, environmental assessment, and other customary real property due diligence matters will be addressed in the real property memorandum.

Corporate Headquarters — Columbus, Ohio. Briarwood's corporate headquarters at 1175 Creekside Drive, Suite 400, Columbus, OH 43215 is a leased facility that serves as the administrative office for both business divisions. As noted above, this facility is designated as an Excluded Asset under the LOI and will be retained by Briarwood as part of the Retained Business. To the extent that Meridian personnel require access to or use of the headquarters facility during a post-closing transition period, such access will be addressed through the Transition Services Agreement.

VIII. OUTSTANDING ITEMS AND FOLLOW-UP REQUESTS

The following items from the due diligence request list dated June 14, 2022 (transmitted to Caldwell, Pruitt & Shaw LLP, attention Rachel Underwood and David Soo, seller's counsel) remain outstanding or incomplete as of the date of this memorandum. Completion of these items is necessary before the corporate and organizational due diligence review can be finalized.

1. Amendments to Articles of Incorporation. We have reviewed copies of two amendments to the Articles of Incorporation (2007 and 2012). We have requested confirmation from Caldwell, Pruitt & Shaw LLP that these represent the complete set of all amendments to the Articles of Incorporation filed since the date of original incorporation. Confirmation is pending.

2. Outstanding Equity Instruments. We have requested written confirmation from Briarwood and its counsel that there are no outstanding equity instruments, stock options, warrants, convertible securities, phantom equity arrangements, stock appreciation rights, or any other rights to acquire equity in Briarwood. While our review of the stock ledger and corporate records disclosed no such instruments, affirmative written confirmation is required for the purposes of the Transaction representations and warranties.

3. Powers of Attorney and Agency Agreements. We have requested copies of any powers of attorney or agency agreements currently in effect pursuant to which any person has been granted authority to act on behalf of Briarwood. No such documents have been located in the Data Room to date, and we have asked seller's counsel to confirm whether any such documents exist.

4. Written Consents of the Sole Shareholder. We have requested copies of any written consents executed by Malcolm Greer as sole shareholder of Briarwood during the past five years. To date, we have reviewed only a limited number of shareholder consents in the Data Room, and we wish to confirm that the complete set of consents has been provided.

5. Organizational Chart — Divisional Personnel Allocation. We have requested a detailed organizational chart that distinguishes Consumer Product Line personnel from Commercial Janitorial Services Division personnel, including identification of shared administrative personnel. This information is relevant to the identification of the approximately 186 transferring employees contemplated under the LOI and is critical for workforce planning, benefits transition, and drafting of the employee-related provisions of the APA and TSA.

6. Foreign Qualification. We have requested confirmation of good standing in any jurisdictions where Briarwood may be qualified to do business as a foreign corporation (aside from Ohio, its state of incorporation). Briarwood's consumer products are distributed nationally, and it is possible that Briarwood is qualified or required to be qualified in one or more additional states. Confirmation of foreign qualification status, and good standing certificates from applicable foreign jurisdictions, is necessary to assess compliance and to identify any jurisdictions where the Consumer Product Lines may require Meridian to register post-closing.

We note that Caldwell, Pruitt & Shaw LLP has been responsive to our requests throughout the due diligence process. Ms. Underwood and Mr. Soo have committed to uploading additional responsive documents to the Data Room on a rolling basis and have indicated that they expect to be in a position to address the majority of the above items within the coming two weeks.

IX. PRELIMINARY CONCLUSIONS AND RECOMMENDATIONS

Based on our review of the materials made available as of the date of this memorandum, we offer the following preliminary conclusions and recommendations:

Conclusions:

• Briarwood Home Essentials, Inc. appears to be validly organized under the laws of the State of Ohio and in good standing with the Ohio Secretary of State.

• The capitalization structure is simple and straightforward, consisting of a single class of common stock held entirely by Malcolm Greer.

• The sole-shareholder and sole-director structure simplifies the approval process for the Transaction and eliminates minority shareholder consent issues and appraisal rights risks.

• There are no subsidiary or affiliate complications. All operations are conducted within a single corporate entity.

• The asset purchase structure, as contemplated by the LOI, is appropriate and necessary for the carve-out acquisition of the Consumer Product Lines while leaving the Retained Business with Briarwood.

Recommendations:

1. Closing Condition — Board Resolution and Shareholder Consent. The APA should require, as a condition to closing, delivery of (a) a certified copy of a resolution of the Board of Directors of Briarwood specifically authorizing the sale of the Acquired Assets and the execution of the APA and ancillary documents, and (b) a written consent of the sole shareholder of Briarwood approving and ratifying the Transaction. Standard forms of these documents should be attached to or referenced in the APA.

2. Ohio Revised Code "Substantially All Assets" Analysis. A detailed analysis should be completed to determine whether the sale of the CleanLeaf and PureHaven product lines constitutes a sale of "substantially all" of Briarwood's assets within the meaning of Section 1701.76 of the Ohio Revised Code. This analysis should consider both quantitative metrics (the Consumer Product Lines represent a significant majority of Briarwood's total revenue and assets) and qualitative factors (the viability and materiality of the Retained Business). Even if the Transaction is determined to constitute a sale of substantially all assets, the sole-shareholder structure makes compliance with the two-thirds voting power requirement straightforward, as Mr. Greer's written consent will satisfy the statutory threshold. Nevertheless, this analysis should be documented and the closing deliverables should include appropriate compliance certificates.

3. Foreign Qualification Status. The Transaction team should confirm Briarwood's foreign qualification status in all jurisdictions where it conducts business related to the Consumer Product Lines. This information is necessary to (a) ensure that Briarwood has been in compliance with applicable state registration requirements, (b) identify jurisdictions where Meridian may need to register post-closing, and (c) obtain good standing certificates from applicable foreign jurisdictions as closing deliverables.

4. Acquired Assets / Excluded Assets Delineation. Given the single-entity, two-division structure of Briarwood, careful and precise drafting of the Acquired Assets and Excluded Assets definitions and schedules in the APA is essential. The drafting team should work closely with Meridian's financial and operational advisors to identify and allocate all shared assets, shared contracts, intercompany allocations, and shared personnel. This is the area of greatest organizational risk in the Transaction and should receive priority attention during the APA drafting process. The Buyer's initial draft of the APA schedules is targeted for September 15, 2022.

5. Consolidated Due Diligence Summary. The findings set forth in this memorandum will be incorporated into a consolidated Due Diligence Summary Memorandum covering all due diligence workstreams. The consolidated memorandum is targeted for completion in October 2022 and will provide a comprehensive summary of all due diligence findings, risk factors, and recommendations for the Transaction team's consideration in advance of the anticipated closing.

X. APPENDICES / ATTACHMENTS

Appendix A: List of Reviewed Documents

The following documents were reviewed in connection with the preparation of this memorandum. Data Room folder references correspond to the Pemberton Systems virtual Data Room established under Project Code BHE-CleanLeaf-2022.

Appendix B: Organizational Chart of Briarwood Home Essentials, Inc.

The organizational chart referenced throughout this memorandum was provided by Briarwood management and uploaded to the Data Room as Document No. 1.2.026. The chart depicts Briarwood Home Essentials, Inc. as a single corporate entity with two operating divisions: (i) Consumer Product Lines (CleanLeaf and PureHaven) and (ii) Commercial Janitorial Services Division. The chart is attached hereto as Appendix B.

Note: The organizational chart provided by Briarwood is a high-level summary chart and does not include a detailed breakdown of personnel by division. A more detailed organizational chart distinguishing Consumer Product Line personnel from Commercial Janitorial Services Division personnel has been requested (see Section VIII, Item 5) and is subject to update upon receipt.

CONFIDENTIALITY NOTICE: This memorandum constitutes Attorney-Client Privileged communication and Attorney Work Product prepared in anticipation of litigation and for the provision of legal advice. This document is intended solely for the use of the addressees identified above and other authorized personnel of Calderwood & Harkness LLP and Meridian Consumer Brands LLC. Any unauthorized review, use, disclosure, or distribution is prohibited. If you have received this document in error, please contact the sender immediately and destroy all copies.

Calderwood & Harkness LLP 599 Lexington Avenue, 36th Floor New York, NY 10022

Matter No. 1011-00005

Data Room Folder	Description
Folder 1.1 (Corporate)	Charter documents, good standing certificates, annual reports
Folder 1.2 (Organizational)	Board and shareholder resolutions, officer appointments, organizational chart
Folder 1.3 (Capitalization)	Stock ledger, shareholder records, equity instrument records
Item	Detail
Full Legal Name	Briarwood Home Essentials, Inc.
Entity Type	Corporation
Jurisdiction of Incorporation	State of Ohio
Year of Formation	2004
Employer Identification Number (EIN)	31-1684239
Filing Authority	Ohio Secretary of State
Certificate No.	Date of Issuance	Shareholder	Shares Issued	Shares Cancelled	Notes
001	March 15, 2004	Malcolm Greer	1,000	—	Original issuance at incorporation
Title	Name	Date of Appointment
President	Malcolm Greer	March 15, 2004 (at incorporation)
Vice President of Operations	Janet Tsao	June 1, 2016
Secretary	Malcolm Greer	March 15, 2004 (at incorporation)
Treasurer	Malcolm Greer	March 15, 2004 (at incorporation)
Item No.	Document Description	Data Room Folder	Document No.
1	Articles of Incorporation of Briarwood Home Essentials, Inc. (original filing, 2004)	1.1	1.1.001
2	First Amendment to Articles of Incorporation (2007 — registered agent update)	1.1	1.1.002
3	Second Amendment to Articles of Incorporation (2012 — indemnification provision)	1.1	1.1.003
4	Code of Regulations of Briarwood Home Essentials, Inc.	1.1	1.1.004
5	Certificate of Good Standing — Ohio Secretary of State (dated June 22, 2022)	1.1	1.1.005
6	Annual Reports filed with Ohio Secretary of State (2018–2022)	1.1	1.1.006–1.1.010

7	Resolutions of the Board of Directors (various dates, 2017–2022)	1.2	1.2.001–1.2.018
8	Written Consents of Sole Shareholder (various dates, limited set provided)	1.2	1.2.019–1.2.022
9	Officer Appointment Resolutions	1.2	1.2.023–1.2.025
10	Organizational Chart — Briarwood Home Essentials, Inc.	1.2	1.2.026
11	Stock Ledger of Briarwood Home Essentials, Inc.	1.3	1.3.001
12	Share Certificate No. 001 (copy) — Malcolm Greer	1.3	1.3.002

ATTORNEY WORK PRODUCT / PRIVILEGED & CONFIDENTIAL
MEMORANDUM
July 8, 2022
TO: Andrew Fitzpatrick, Lead Associate, Calderwood & Harkness LLP Sandra Tung, Responsible Partner, Calderwood & Harkness LLP
FROM: Naomi Petersen, Working Associate, Calderwood & Harkness LLP
RE: Due Diligence Memorandum — Corporate & Organizational Review of Briarwood Home Essentials, Inc.
MATTER: Meridian Consumer Brands LLC — Proposed Acquisition of CleanLeaf and PureHaven Product Lines from Briarwood Home Essentials, Inc.
MATTER NO.: 1011-00005
REVIEWED BY: Andrew Fitzpatrick
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I. EXECUTIVE SUMMARY
This memorandum summarizes the preliminary findings from Calderwood & Harkness LLP's corporate and organizational due diligence review of Briarwood Home Essentials, Inc. ("Briarwood" or "BHE") in connection with the proposed acquisition by our client, Meridian Consumer Brands LLC ("Meridian" or "MCB"), of Briarwood's CleanLeaf and PureHaven consumer product lines (collectively, the "Acquired Assets") for a proposed purchase price of $95,000,000 (the "Transaction").
The Transaction is structured as an asset purchase pursuant to a Letter of Intent dated March 28, 2022 (the "LOI"), executed by and between Meridian and Briarwood. Formal due diligence commenced on June 14, 2022, following the execution of a mutual non-disclosure agreement and the establishment of a virtual data room. Data room access was granted via the Pemberton Systems platform under Project Code BHE-CleanLeaf-2022 (the "Data Room"). Calderwood & Harkness LLP has been engaged by Meridian to conduct legal due diligence across all applicable workstreams, of which this memorandum addresses the corporate and organizational workstream.
Overall Assessment. Based on our review of the materials made available as of the date of this memorandum, Briarwood appears to be a validly formed and existing corporation organized under the laws of the State of Ohio and in good standing with the Ohio Secretary of State. The capitalization structure is straightforward: Briarwood has a single class of common shares authorized, all of which are held by a single shareholder, Malcolm Greer. Briarwood has no subsidiaries, joint ventures, or affiliated entities. Authority to consummate the Transaction appears to be vested in Mr. Greer, who serves as both the sole shareholder and sole director of Briarwood. The retained division of Briarwood's business — the Commercial Janitorial Services Division — is operationally separate from the Acquired Assets, though both divisions are housed within a single corporate entity, which necessitates careful delineation in the Asset Purchase Agreement ("APA") schedules.
Certain follow-up items remain open as of the date of this memorandum, including confirmation of foreign qualification status and completion of outstanding document requests directed to seller's counsel, Caldwell, Pruitt & Shaw LLP. These items are detailed in Section VIII below. None of the outstanding items are expected to present material impediments to the Transaction based on information received to date, but final conclusions are subject to receipt and review of all requested materials.
II. SCOPE AND METHODOLOGY
A. Scope of Review
The scope of this memorandum is limited to the corporate and organizational due diligence review of Briarwood Home Essentials, Inc. This review encompasses the following subject matter areas:
• Formation and corporate status, including charter documents and good standing;
• Capitalization and ownership structure, including the stock ledger, shareholder records, and any outstanding equity instruments;
• Board of directors composition, officer appointments, and corporate governance;
• Subsidiary and affiliate structure, including any joint ventures or minority equity investments;
• Divisional structure, with particular attention to the distinction between the Acquired Assets (CleanLeaf and PureHaven product lines) and the Retained Business (Commercial Janitorial Services Division); and
• Authority of the relevant corporate actors to consummate the Transaction.
This memorandum does not address intellectual property, material contracts, employee and labor matters, environmental matters, litigation, tax, regulatory compliance, insurance, or real property and leases, each of which is the subject of a separate due diligence workstream and corresponding memorandum. Cross-references to other workstreams are provided where relevant.
B. Documents Reviewed
The following categories of documents were reviewed in connection with the preparation of this memorandum:
1. Articles of Incorporation of Briarwood Home Essentials, Inc., including all amendments thereto through the date of this review;
2. Code of Regulations of Briarwood Home Essentials, Inc. (the Ohio equivalent of corporate bylaws);
3. Certificate of Good Standing issued by the Ohio Secretary of State, dated June 22, 2022;
4. Shareholder records and stock ledger of Briarwood Home Essentials, Inc.;
5. Resolutions of the Board of Directors of Briarwood Home Essentials, Inc. (available resolutions through date of Data Room access);
6. Written consents and resolutions of the sole shareholder of Briarwood Home Essentials, Inc. (to the extent made available);
7. Records of officer appointments, including board resolutions appointing current officers;
8. Annual reports filed with the Ohio Secretary of State;
9. Organizational chart of Briarwood Home Essentials, Inc. provided by Briarwood management; and
10. Such other documents and information as were made available in the Data Room as described below.
C. Data Room References
All materials reviewed were obtained from the Pemberton Systems virtual Data Room established under Project Code BHE-CleanLeaf-2022. The reviewed materials were located in the following Data Room folders:
Document indices for each folder were reviewed and cross-referenced against our due diligence request list to identify outstanding items, as further discussed in Section VIII.
D. Limitations. This memorandum is based solely on documents and information made available to Calderwood & Harkness LLP as of the date hereof. Our review is necessarily limited by the completeness and accuracy of the materials provided. Certain items on the due diligence request list dated June 14, 2022 (transmitted to Caldwell, Pruitt & Shaw LLP, attention Rachel Underwood and David Soo, seller's counsel) remain outstanding as noted in Section VIII below. The conclusions and assessments set forth in this memorandum are preliminary in nature and may be revised upon receipt and review of additional materials. This memorandum does not constitute a legal opinion and should not be relied upon as such.
III. ENTITY FORMATION AND STATUS
A. Formation. Briarwood Home Essentials, Inc. is a corporation organized under the laws of the State of Ohio. The company was founded in 2004 by Malcolm Greer and has been in continuous operation since its formation. The following key formation and identification details have been confirmed through our review:
We reviewed the original Articles of Incorporation of Briarwood Home Essentials, Inc. as filed with the Ohio Secretary of State in 2004, together with all amendments thereto through the date of this review. The Articles of Incorporation were filed in the form customary for Ohio corporations and set forth the following principal provisions:
(a) Name. The name of the corporation is "Briarwood Home Essentials, Inc."
(b) Purpose. The corporation is formed for the purpose of engaging in any lawful act or activity for which corporations may be formed under the Ohio Revised Code.
(c) Authorized Shares. The corporation is authorized to issue 10,000 shares of common stock, no par value per share, constituting a single class of common shares. No preferred stock or other class of equity securities is authorized under the Articles of Incorporation.
(d) Incorporator. Malcolm Greer is identified as the sole incorporator.
(e) Initial Registered Agent. The Articles designate an initial registered agent and registered office address in the State of Ohio (subsequently updated as described in Section III.C below).
Based on our review, the Articles of Incorporation have been amended on two occasions: (i) a 2007 amendment updating the registered agent designation, and (ii) a 2012 amendment adopting an updated provision regarding director indemnification consistent with then-current Ohio Revised Code provisions. Neither amendment altered the authorized share structure, the corporate purpose, or any other material organizational provision. We have requested confirmation from Caldwell, Pruitt & Shaw LLP that the amendments reviewed in the Data Room represent the complete set of all amendments to the Articles of Incorporation (see Section VIII, Item 1).
B. Good Standing
We obtained and reviewed a Certificate of Good Standing issued by the Ohio Secretary of State with respect to Briarwood Home Essentials, Inc., dated June 22, 2022. The Certificate confirms that Briarwood is in good standing under Ohio law and is current on all franchise tax filings and annual reports required to be filed with the Ohio Secretary of State as of the date of the Certificate.
Based on our review of publicly available records maintained by the Ohio Secretary of State's office, we identified no pending dissolution proceedings, revocation of corporate authority, or administrative actions against Briarwood. The corporation's status appears to be fully active and compliant with Ohio statutory requirements.
We note that the Certificate of Good Standing was issued approximately sixteen days prior to the date of this memorandum. It is customary to obtain an updated good standing certificate within ten business days prior to closing. We recommend that an updated Certificate of Good Standing be obtained as a condition to closing under the APA, and we will include this as a closing deliverable in our initial draft of the APA closing conditions.
C. Registered Agent
Briarwood's current registered agent in the State of Ohio is Ohio Registered Agent Services, Inc., a professional registered agent service company. The registered office address on file with the Ohio Secretary of State is:
Ohio Registered Agent Services, Inc. 50 West Broad Street Columbus, OH 43215
The registered agent designation is current and active per Ohio Secretary of State records as of the date of this memorandum. The registered agent designation was updated in 2007 by amendment to the Articles of Incorporation, replacing the original registered agent designation that named Malcolm Greer individually at his residential address. The use of a professional registered agent service is consistent with standard corporate practice and does not raise any concerns.
D. Principal Place of Business
Briarwood's principal place of business and corporate headquarters is located at the following address:
1175 Creekside Drive, Suite 400 Columbus, OH 43215
This headquarters facility serves as the administrative office for both the Consumer Product Lines (Acquired Assets) and the Commercial Janitorial Services Division (Retained Business). It is our understanding, based on the organizational chart and management representations provided through the Data Room, that certain administrative personnel at the headquarters location serve both divisions, including accounting, human resources, and executive management functions.
We note that the headquarters lease is designated as an excluded asset under the LOI and will be retained by Briarwood as part of the Retained Business. The allocation of shared administrative functions and personnel between the Acquired Assets and the Retained Business will need to be carefully addressed in the Transition Services Agreement ("TSA") that is expected to be negotiated as an ancillary agreement to the APA. This matter will be further addressed in the employee and labor due diligence memorandum and in connection with the drafting of the TSA.
IV. CAPITALIZATION AND OWNERSHIP
A. Authorized Capital
As described in Section III.A above, the Articles of Incorporation of Briarwood Home Essentials, Inc. authorize the issuance of 10,000 shares of common stock, no par value per share. This constitutes a single class of common shares. The Articles do not authorize the issuance of preferred stock or any other class or series of equity securities. No amendments to the Articles have been filed that would alter the authorized share structure.
The single-class common stock structure is typical of closely held Ohio corporations and is consistent with the sole-shareholder ownership described below.
B. Outstanding Shares and Ownership
Based on our review of the stock ledger maintained in Data Room Folder 1.3, Malcolm Greer is the sole shareholder of Briarwood Home Essentials, Inc. Mr. Greer holds 1,000 shares of common stock, representing 100% of the issued and outstanding shares of the corporation. The stock ledger reflects that these shares were originally issued to Mr. Greer at the time of incorporation in 2004. No transfers of shares have been recorded in the stock ledger at any time since the date of original issuance.
We reviewed the stock ledger for completeness and consistency. The ledger is maintained in a standard bound stock ledger book format and contains the following entries:
No additional entries appear in the stock ledger. There are no cancelled certificates, no transfers, and no notation of any liens, pledges, or encumbrances on the shares.
We have not identified any stock option plans, stock incentive plans, phantom equity arrangements, stock appreciation rights, warrants, convertible notes, convertible preferred instruments, or any other equity-linked instruments or rights outstanding. No agreements granting any person the right to acquire shares of Briarwood have been located in the Data Room. We have requested written confirmation from Briarwood and its counsel that no such instruments or arrangements exist (see Section VIII, Item 2).
C. Shareholder Agreements
Given the sole-shareholder structure, there are no shareholders' agreements, voting agreements, voting trusts, buy-sell agreements, or other arrangements among shareholders. We have not identified any preemptive rights, rights of first refusal, tag-along rights, drag-along rights, co-sale rights, or other restrictions on the transfer of shares, whether set forth in the Articles of Incorporation, the Code of Regulations, or any separate agreement.
The absence of shareholder agreements and transfer restrictions is consistent with a single-shareholder closely held corporation and simplifies the Transaction from a consent and approval perspective.
D. Implications for the Transaction
The sole-shareholder structure of Briarwood has several favorable implications for the Transaction:
(a) Simplified Approval Process. As the sole shareholder and sole director of Briarwood, Malcolm Greer has the authority to approve and authorize the Transaction without the need for a shareholder vote involving other parties, without triggering any tag-along, drag-along, or co-sale rights, and without the need to obtain consent from or provide notice to any co-shareholders.
(b) Single Consent Required. A single written consent of the sole shareholder, together with a corresponding board resolution adopted by Mr. Greer as sole director, will be sufficient to authorize the execution and delivery of the APA and the consummation of the Transaction, subject to the "substantially all assets" analysis discussed in Section V.C below.
(c) Consistency with Non-Competition Covenant. Mr. Greer's role as the proposed party to the Non-Competition and Non-Solicitation Agreement (which, per the LOI, contemplates a four-year term applicable to consumer products only) is consistent with his position as the sole owner and principal operator of Briarwood. His willingness to execute this agreement is a key commercial term of the Transaction and is appropriately tied to his ownership and operational involvement in the Consumer Product Lines.
(d) No Minority Shareholder Issues. There are no minority shareholders whose interests must be considered, no minority consent rights, and no risk of appraisal rights claims by dissenting shareholders. This eliminates a category of transaction risk that is frequently present in closely held corporation acquisitions.
V. BOARD OF DIRECTORS AND OFFICERS
A. Board of Directors
Briarwood's Code of Regulations (the Ohio equivalent of corporate bylaws) provides for a board of directors responsible for the management and direction of the corporation's business and affairs. The Code of Regulations permits the board to consist of one or more directors, with the number to be fixed by resolution of the shareholders or the board from time to time.
As of the date of this memorandum, the board of directors of Briarwood consists of a single director: Malcolm Greer. Mr. Greer has served as the sole director of Briarwood since the corporation's formation in 2004. There are no independent directors, no advisory board members, and no committees of the board (including no audit committee, compensation committee, or governance committee). The absence of independent directors and board committees is typical of sole-shareholder closely held corporations and does not raise governance concerns in the context of the Transaction.
We reviewed available board resolutions uploaded to Data Room Folder 1.2. The resolutions document routine corporate actions, including the annual election of officers, authorization of banking relationships, approval of lease agreements, and other matters in the ordinary course of business. The resolutions are consistently executed by Malcolm Greer as sole director and appear to be in proper form under Ohio law. We did not identify any resolutions relating to the Transaction or to any prior sale or disposition of material assets.
B. Officers. Based on our review of the corporate records, including board resolutions appointing officers and the organizational chart provided by Briarwood management, the following individuals currently serve as officers of Briarwood Home Essentials, Inc.:
Mr. Greer holds multiple officer positions in addition to his role as sole director, which is common in closely held corporations. Janet Tsao serves as Vice President of Operations and, based on the organizational chart, has operational responsibility over both the Consumer Product Lines and the Commercial Janitorial Services Division, though the day-to-day management of each division is handled by separate division managers reporting to Ms. Tsao.
All officer appointments were made by resolution of the board of directors, and copies of the appointing resolutions were reviewed in the Data Room. The resolutions are in standard form and do not contain any unusual conditions, limitations on authority, or special compensation arrangements beyond those expected for positions of this nature.
C. Authority to Execute Transaction Documents
As sole director and President of Briarwood, Malcolm Greer has authority under the Code of Regulations and applicable Ohio law to execute the APA and ancillary transaction documents on behalf of the corporation. The Code of Regulations grants the President the power to execute contracts, deeds, and other instruments on behalf of the corporation, subject to any specific restrictions imposed by the board of directors. We identified no such restrictions in the reviewed resolutions or in the Code of Regulations.
Notwithstanding the foregoing, we recommend the following steps to ensure that proper corporate authority is documented for the Transaction:
(a) Board Resolution. The APA should require, as a condition to closing, delivery of a certified copy of a resolution of the Board of Directors of Briarwood (i.e., a resolution adopted by Malcolm Greer as sole director) specifically authorizing the sale of the Acquired Assets, the execution and delivery of the APA and all ancillary documents, and the consummation of the transactions contemplated thereby. A standard form of such resolution should be attached to the APA or included in the closing conditions.
(b) Sole Shareholder Written Consent. Similarly, the APA should require delivery of a written consent of the sole shareholder of Briarwood (i.e., Malcolm Greer) approving and ratifying the Transaction. This written consent serves as the functional equivalent of a shareholder vote and is the customary mechanism for shareholder approval in sole-shareholder corporations under Ohio law.
Ohio Revised Code — Sale of Substantially All Assets. We note that Section 1701.76 of the Ohio Revised Code requires that a sale, lease, exchange, or other disposition of all, or substantially all, of the assets of a corporation (other than in the usual and regular course of business) must be authorized by the affirmative vote or written consent of the holders of at least two-thirds of the voting power of the corporation. We recommend that the Transaction team conduct a more detailed analysis of whether the CleanLeaf and PureHaven product lines, which generated FY2021 revenue of approximately $68,000,000 and FY2021 EBITDA of approximately $11,200,000, constitute "substantially all" of Briarwood's assets within the meaning of Section 1701.76. This analysis will require consideration of the total assets of Briarwood, including the Retained Business (Commercial Janitorial Services Division), and should take into account both quantitative factors (percentage of total revenue, total assets, and total EBITDA attributable to the Acquired Assets) and qualitative factors (whether the Retained Business is sufficient to enable Briarwood to continue its corporate existence and operations in a meaningful way).
Even if the Transaction is determined to constitute a sale of "substantially all" of Briarwood's assets, compliance with Section 1701.76 is straightforward in the context of a sole-shareholder corporation, as Mr. Greer's written consent would satisfy the two-thirds voting power requirement. Nevertheless, we recommend that the analysis be completed and documented, and that the closing deliverables include a certificate from Mr. Greer confirming compliance with all applicable statutory requirements.
VI. SUBSIDIARY AND AFFILIATE STRUCTURE
A. Subsidiaries. Based on our review of the corporate records, organizational chart, annual reports, and other materials made available in the Data Room, Briarwood Home Essentials, Inc. has no subsidiaries. The corporation does not own, directly or indirectly, any equity interest in any other corporation, limited liability company, partnership, joint venture, or other business entity. All of Briarwood's operations — including both the Consumer Product Lines (Acquired Assets) and the Commercial Janitorial Services Division (Retained Business) — are conducted directly by Briarwood Home Essentials, Inc. as a single corporate entity.
We identified no joint venture agreements, partnership agreements, or other arrangements pursuant to which Briarwood participates in any collaborative business venture with any third party. No minority equity investments by Briarwood in other entities were identified. The organizational chart provided by Briarwood management is consistent with this finding and depicts a single corporate entity without any subsidiary or affiliate branches.
B. Affiliates. Other than Malcolm Greer in his individual capacity as sole shareholder, sole director, and President of Briarwood, we identified no affiliated entities, management companies, holding companies, family trusts, or other related-party entities that have any ownership interest in, management authority over, or contractual relationship with Briarwood. Mr. Greer does not appear to conduct any business activities through any entity other than Briarwood, based on the information reviewed to date, although we have not independently verified this and recommend that representations to this effect be included in the APA.
The absence of a holding company or other intermediate ownership structure simplifies the Transaction from a structural and approval perspective and eliminates the need for upstream consents or approvals from parent entities.
C. Divisional Structure — Retained Business vs. Acquired Assets
Briarwood operates two distinct business lines within a single corporate entity. This divisional structure is central to the Transaction and warrants careful attention in the drafting of the APA and its schedules.
Consumer Product Lines (Acquired Assets). The first division encompasses Briarwood's consumer-facing product business, which consists of two branded product lines:
(i) CleanLeaf. The CleanLeaf brand encompasses a line of eco-friendly home cleaning products, including all-purpose cleaners, dish soaps, laundry detergents, and specialty cleaning solutions. The CleanLeaf line is distributed through major national retailers and direct-to-consumer e-commerce channels.
(ii) PureHaven. The PureHaven brand encompasses a line of natural personal care products, including hand soaps, body washes, lotions, and related products. The PureHaven line is similarly distributed through national retail and e-commerce channels.
Together, the CleanLeaf and PureHaven brands encompass approximately 142 active SKUs. For the fiscal year ended December 31, 2021, the Consumer Product Lines generated revenue of approximately $68,000,000 and EBITDA of approximately $11,200,000. As of June 30, 2022, accounts receivable attributable to the Consumer Product Lines totaled approximately $9,700,000.
The Acquired Assets include, in addition to the CleanLeaf and PureHaven brands and associated intellectual property, the following categories of assets: (a) inventory related to the Consumer Product Lines; (b) accounts receivable attributable to the Consumer Product Lines ($9,700,000 as of June 30, 2022); (c) equipment used in the manufacture and distribution of consumer products; (d) intellectual property associated with the CleanLeaf and PureHaven brands, including trademarks, trade names, formulations, and packaging designs; (e) twenty-three (23) customer contracts related to the Consumer Product Lines; (f) the Marysville manufacturing facility lease (subject to landlord consent to assignment); and (g) the West Jefferson distribution center (owned by Briarwood and to be conveyed as part of the Acquired Assets).
Commercial Janitorial Services Division (Retained Business). The second division is Briarwood's commercial janitorial services business, which provides contract janitorial and facilities maintenance services to commercial clients in the greater Columbus, Ohio metropolitan area. This division will not be part of the asset purchase and will be retained by Briarwood post-closing. The Commercial Janitorial Services Division operates from the Columbus headquarters and utilizes separate equipment, personnel, and customer relationships from the Consumer Product Lines.
Observation. The two divisions are not separately incorporated and are not held through subsidiaries or otherwise legally separated. Both divisions operate within the single corporate entity, Briarwood Home Essentials, Inc. This structure is the primary reason the Transaction is structured as an asset purchase (rather than a stock acquisition): the asset purchase structure enables Meridian to acquire only the Consumer Product Lines and related assets while leaving the Retained Business in place within Briarwood.
Risk Flag — Asset Delineation. Because both divisions operate within a single legal entity, careful and precise delineation of Acquired Assets versus Excluded Assets in the APA schedules is critical to the success of the Transaction. Areas requiring particular attention include:
(a) Shared Assets. Certain assets may be used by both divisions, including shared information technology systems, shared administrative equipment at the Columbus headquarters, and potentially shared vehicles or other tangible assets. These shared assets must be identified, and a determination must be made as to whether each shared asset will be included in the Acquired Assets, retained by Briarwood, or made available through the Transition Services Agreement.
(b) Shared Contracts. Certain contracts — including insurance policies, vendor agreements, and potentially banking relationships — may cover both divisions. These contracts will need to be reviewed to determine whether they can be partially assigned, whether new standalone contracts will need to be established for the Acquired Assets, or whether the existing contracts will be addressed through the TSA during a transition period.
(c) Intercompany Allocations. The two divisions likely share certain overhead costs, including rent at the Columbus headquarters, administrative personnel costs, insurance premiums, and technology expenses. Historical intercompany allocation methodologies should be reviewed to ensure that the financial statements and representations relating to the Consumer Product Lines accurately reflect the costs of operating those businesses on a standalone basis. This matter will be further addressed in the financial due diligence workstream.
(d) Employee Allocation. The LOI contemplates the transfer of approximately 186 employees from Briarwood to Meridian in connection with the Transaction. A detailed organizational chart distinguishing Consumer Product Line personnel from Commercial Janitorial Services Division personnel has been requested but remains outstanding (see Section VIII, Item 5). Proper identification and allocation of transferring employees is essential for workforce planning, benefits transition, and compliance with applicable employment laws, including WARN Act considerations.
The Buyer's initial draft of the APA schedules is targeted for September 15, 2022. We recommend that the drafting team give priority to the Acquired Assets and Excluded Assets definitions and schedules, and that these schedules be developed in close coordination with Meridian's financial and operational advisors to ensure completeness and accuracy.
VII. REAL PROPERTY AND FACILITIES — ORGANIZATIONAL NEXUS
A separate due diligence memorandum addressing real property and leases will be prepared by the Calderwood & Harkness real property team and is forthcoming. However, given the relevance of certain real property matters to the corporate and organizational analysis, we provide the following preliminary cross-references for context.
Briarwood's operations involve three principal facilities, each of which has a distinct treatment under the proposed Transaction:
Manufacturing Facility — Marysville, Ohio. Briarwood operates a manufacturing facility located at 2800 Industrial Parkway, Marysville, OH 43040. This facility is used for the production of CleanLeaf and PureHaven consumer products and is included in the Acquired Assets. The facility is leased by Briarwood from Buckeye Industrial Properties LLC pursuant to a commercial lease agreement. Assignment of this lease to Meridian will require the prior written consent of the landlord, Buckeye Industrial Properties LLC. The terms of the lease, including any assignment provisions, change-of-control clauses, and consent requirements, will be addressed in detail in the real property and leases due diligence memorandum. We flag this as a key closing deliverable item: landlord consent to assignment must be obtained prior to or at closing.
Distribution Center — West Jefferson, Ohio. Briarwood owns a distribution center located at 500 Commerce Boulevard, West Jefferson, OH 43162. This facility is used for the warehousing and distribution of Consumer Product Line inventory and is included in the Acquired Assets. Because this facility is owned by Briarwood (rather than leased), it will be conveyed to Meridian by deed as part of the Acquired Assets. Title insurance, survey, environmental assessment, and other customary real property due diligence matters will be addressed in the real property memorandum.
Corporate Headquarters — Columbus, Ohio. Briarwood's corporate headquarters at 1175 Creekside Drive, Suite 400, Columbus, OH 43215 is a leased facility that serves as the administrative office for both business divisions. As noted above, this facility is designated as an Excluded Asset under the LOI and will be retained by Briarwood as part of the Retained Business. To the extent that Meridian personnel require access to or use of the headquarters facility during a post-closing transition period, such access will be addressed through the Transition Services Agreement.
VIII. OUTSTANDING ITEMS AND FOLLOW-UP REQUESTS
The following items from the due diligence request list dated June 14, 2022 (transmitted to Caldwell, Pruitt & Shaw LLP, attention Rachel Underwood and David Soo, seller's counsel) remain outstanding or incomplete as of the date of this memorandum. Completion of these items is necessary before the corporate and organizational due diligence review can be finalized.
1. Amendments to Articles of Incorporation. We have reviewed copies of two amendments to the Articles of Incorporation (2007 and 2012). We have requested confirmation from Caldwell, Pruitt & Shaw LLP that these represent the complete set of all amendments to the Articles of Incorporation filed since the date of original incorporation. Confirmation is pending.
2. Outstanding Equity Instruments. We have requested written confirmation from Briarwood and its counsel that there are no outstanding equity instruments, stock options, warrants, convertible securities, phantom equity arrangements, stock appreciation rights, or any other rights to acquire equity in Briarwood. While our review of the stock ledger and corporate records disclosed no such instruments, affirmative written confirmation is required for the purposes of the Transaction representations and warranties.
3. Powers of Attorney and Agency Agreements. We have requested copies of any powers of attorney or agency agreements currently in effect pursuant to which any person has been granted authority to act on behalf of Briarwood. No such documents have been located in the Data Room to date, and we have asked seller's counsel to confirm whether any such documents exist.
4. Written Consents of the Sole Shareholder. We have requested copies of any written consents executed by Malcolm Greer as sole shareholder of Briarwood during the past five years. To date, we have reviewed only a limited number of shareholder consents in the Data Room, and we wish to confirm that the complete set of consents has been provided.
5. Organizational Chart — Divisional Personnel Allocation. We have requested a detailed organizational chart that distinguishes Consumer Product Line personnel from Commercial Janitorial Services Division personnel, including identification of shared administrative personnel. This information is relevant to the identification of the approximately 186 transferring employees contemplated under the LOI and is critical for workforce planning, benefits transition, and drafting of the employee-related provisions of the APA and TSA.
6. Foreign Qualification. We have requested confirmation of good standing in any jurisdictions where Briarwood may be qualified to do business as a foreign corporation (aside from Ohio, its state of incorporation). Briarwood's consumer products are distributed nationally, and it is possible that Briarwood is qualified or required to be qualified in one or more additional states. Confirmation of foreign qualification status, and good standing certificates from applicable foreign jurisdictions, is necessary to assess compliance and to identify any jurisdictions where the Consumer Product Lines may require Meridian to register post-closing.
We note that Caldwell, Pruitt & Shaw LLP has been responsive to our requests throughout the due diligence process. Ms. Underwood and Mr. Soo have committed to uploading additional responsive documents to the Data Room on a rolling basis and have indicated that they expect to be in a position to address the majority of the above items within the coming two weeks.
IX. PRELIMINARY CONCLUSIONS AND RECOMMENDATIONS
Based on our review of the materials made available as of the date of this memorandum, we offer the following preliminary conclusions and recommendations:
Conclusions:
• Briarwood Home Essentials, Inc. appears to be validly organized under the laws of the State of Ohio and in good standing with the Ohio Secretary of State.
• The capitalization structure is simple and straightforward, consisting of a single class of common stock held entirely by Malcolm Greer.
• The sole-shareholder and sole-director structure simplifies the approval process for the Transaction and eliminates minority shareholder consent issues and appraisal rights risks.
• There are no subsidiary or affiliate complications. All operations are conducted within a single corporate entity.
• The asset purchase structure, as contemplated by the LOI, is appropriate and necessary for the carve-out acquisition of the Consumer Product Lines while leaving the Retained Business with Briarwood.
Recommendations:
1. Closing Condition — Board Resolution and Shareholder Consent. The APA should require, as a condition to closing, delivery of (a) a certified copy of a resolution of the Board of Directors of Briarwood specifically authorizing the sale of the Acquired Assets and the execution of the APA and ancillary documents, and (b) a written consent of the sole shareholder of Briarwood approving and ratifying the Transaction. Standard forms of these documents should be attached to or referenced in the APA.
2. Ohio Revised Code "Substantially All Assets" Analysis. A detailed analysis should be completed to determine whether the sale of the CleanLeaf and PureHaven product lines constitutes a sale of "substantially all" of Briarwood's assets within the meaning of Section 1701.76 of the Ohio Revised Code. This analysis should consider both quantitative metrics (the Consumer Product Lines represent a significant majority of Briarwood's total revenue and assets) and qualitative factors (the viability and materiality of the Retained Business). Even if the Transaction is determined to constitute a sale of substantially all assets, the sole-shareholder structure makes compliance with the two-thirds voting power requirement straightforward, as Mr. Greer's written consent will satisfy the statutory threshold. Nevertheless, this analysis should be documented and the closing deliverables should include appropriate compliance certificates.
3. Foreign Qualification Status. The Transaction team should confirm Briarwood's foreign qualification status in all jurisdictions where it conducts business related to the Consumer Product Lines. This information is necessary to (a) ensure that Briarwood has been in compliance with applicable state registration requirements, (b) identify jurisdictions where Meridian may need to register post-closing, and (c) obtain good standing certificates from applicable foreign jurisdictions as closing deliverables.
4. Acquired Assets / Excluded Assets Delineation. Given the single-entity, two-division structure of Briarwood, careful and precise drafting of the Acquired Assets and Excluded Assets definitions and schedules in the APA is essential. The drafting team should work closely with Meridian's financial and operational advisors to identify and allocate all shared assets, shared contracts, intercompany allocations, and shared personnel. This is the area of greatest organizational risk in the Transaction and should receive priority attention during the APA drafting process. The Buyer's initial draft of the APA schedules is targeted for September 15, 2022.
5. Consolidated Due Diligence Summary. The findings set forth in this memorandum will be incorporated into a consolidated Due Diligence Summary Memorandum covering all due diligence workstreams. The consolidated memorandum is targeted for completion in October 2022 and will provide a comprehensive summary of all due diligence findings, risk factors, and recommendations for the Transaction team's consideration in advance of the anticipated closing.
X. APPENDICES / ATTACHMENTS
Appendix A: List of Reviewed Documents
The following documents were reviewed in connection with the preparation of this memorandum. Data Room folder references correspond to the Pemberton Systems virtual Data Room established under Project Code BHE-CleanLeaf-2022.
Appendix B: Organizational Chart of Briarwood Home Essentials, Inc.
The organizational chart referenced throughout this memorandum was provided by Briarwood management and uploaded to the Data Room as Document No. 1.2.026. The chart depicts Briarwood Home Essentials, Inc. as a single corporate entity with two operating divisions: (i) Consumer Product Lines (CleanLeaf and PureHaven) and (ii) Commercial Janitorial Services Division. The chart is attached hereto as Appendix B.
Note: The organizational chart provided by Briarwood is a high-level summary chart and does not include a detailed breakdown of personnel by division. A more detailed organizational chart distinguishing Consumer Product Line personnel from Commercial Janitorial Services Division personnel has been requested (see Section VIII, Item 5) and is subject to update upon receipt.
CONFIDENTIALITY NOTICE: This memorandum constitutes Attorney-Client Privileged communication and Attorney Work Product prepared in anticipation of litigation and for the provision of legal advice. This document is intended solely for the use of the addressees identified above and other authorized personnel of Calderwood & Harkness LLP and Meridian Consumer Brands LLC. Any unauthorized review, use, disclosure, or distribution is prohibited. If you have received this document in error, please contact the sender immediately and destroy all copies.
Calderwood & Harkness LLP 599 Lexington Avenue, 36th Floor New York, NY 10022
Matter No. 1011-00005
Data Room Folder | Description
Folder 1.1 (Corporate) | Charter documents, good standing certificates, annual reports
Folder 1.2 (Organizational) | Board and shareholder resolutions, officer appointments, organizational chart
Folder 1.3 (Capitalization) | Stock ledger, shareholder records, equity instrument records
Item | Detail
Full Legal Name | Briarwood Home Essentials, Inc.
Entity Type | Corporation
Jurisdiction of Incorporation | State of Ohio
Year of Formation | 2004
Employer Identification Number (EIN) | 31-1684239
Filing Authority | Ohio Secretary of State
Certificate No. | Date of Issuance | Shareholder | Shares Issued | Shares Cancelled | Notes
001 | March 15, 2004 | Malcolm Greer | 1,000 | — | Original issuance at incorporation
Title | Name | Date of Appointment
President | Malcolm Greer | March 15, 2004 (at incorporation)
Vice President of Operations | Janet Tsao | June 1, 2016
Secretary | Malcolm Greer | March 15, 2004 (at incorporation)
Treasurer | Malcolm Greer | March 15, 2004 (at incorporation)
Item No. | Document Description | Data Room Folder | Document No.
1 | Articles of Incorporation of Briarwood Home Essentials, Inc. (original filing, 2004) | 1.1 | 1.1.001
2 | First Amendment to Articles of Incorporation (2007 — registered agent update) | 1.1 | 1.1.002
3 | Second Amendment to Articles of Incorporation (2012 — indemnification provision) | 1.1 | 1.1.003
4 | Code of Regulations of Briarwood Home Essentials, Inc. | 1.1 | 1.1.004
5 | Certificate of Good Standing — Ohio Secretary of State (dated June 22, 2022) | 1.1 | 1.1.005
6 | Annual Reports filed with Ohio Secretary of State (2018–2022) | 1.1 | 1.1.006–1.1.010
7 | Resolutions of the Board of Directors (various dates, 2017–2022) | 1.2 | 1.2.001–1.2.018
8 | Written Consents of Sole Shareholder (various dates, limited set provided) | 1.2 | 1.2.019–1.2.022
9 | Officer Appointment Resolutions | 1.2 | 1.2.023–1.2.025
10 | Organizational Chart — Briarwood Home Essentials, Inc. | 1.2 | 1.2.026
11 | Stock Ledger of Briarwood Home Essentials, Inc. | 1.3 | 1.3.001
12 | Share Certificate No. 001 (copy) — Malcolm Greer | 1.3 | 1.3.002