1015-00001 · Graymont Brothers Inc · Corporate Governance

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RESOLUTIONS OF THE BOARD OF DIRECTORS OF CALLOWAY-BRIGGS RENEWABLES INC.

Establishment of Audit Committee, Appointment of Members, and Designation of Audit Committee Financial Expert

Adopted by the Board of Directors at a Meeting Duly Called and Held on September 14, 2022

The following resolutions were adopted by the Board of Directors (the "Board") of Calloway-Briggs Renewables Inc., a Delaware corporation (the "Company"), at a meeting of the Board duly called and held on September 14, 2022, at the principal offices of the Company, 4200 Ridgeline Parkway, Suite 1100, Austin, Texas 78746, at which a quorum was present and acting throughout. These resolutions are adopted in connection with the proposed initial public offering of common stock of the Company on the New York Stock Exchange under the proposed ticker symbol "CBRI."

RECITALS

WHEREAS, the Company is a corporation duly organized and existing under the laws of the State of Delaware, with its principal offices located at 4200 Ridgeline Parkway, Suite 1100, Austin, Texas 78746, and is registered in the State of Delaware with Capitol Statutory Services, Inc., 1209 Orange Street, Wilmington, Delaware 19801, serving as its registered agent for service of process;

WHEREAS, the Company, in connection with its proposed initial public offering of approximately $600,000,000 of common stock, par value $0.01 per share, on the New York Stock Exchange (the "IPO"), has filed a confidential draft registration statement on Form S-1 with the Securities and Exchange Commission (the "SEC") and anticipates amending and publicly filing such registration statement in due course;

WHEREAS, the Board currently consists of seven (7) members, as follows:

(i) Garrett Calloway — Co-Founder, Chairman of the Board, and Chief Executive Officer;

(ii) Elaine Briggs — Co-Founder and President, Development;

(iii) Hugh Pemberton — Director, designee of Pinnacle Vista Capital Partners III, LP;

(iv) Diane Kovac — Director, designee of Pinnacle Vista Capital Partners III, LP;

(v) Warren Okoro — Independent Director;

(vi) Catherine Liang — Independent Director; and

(vii) Richard Estavez — Independent Director;

WHEREAS, Section 303A of the New York Stock Exchange Listed Company Manual (the "NYSE Manual") requires that each listed company have an audit committee composed entirely of independent directors, subject to the controlled-company exemption set forth in Section 303A.00 and the applicable phase-in rules for companies listing in connection with an initial public offering as set forth in Section 303A.00(b) of the NYSE Manual;

WHEREAS, Rule 10A-3 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), requires that each member of the audit committee of a listed issuer be independent within the meaning of such rule, subject to the phase-in provisions set forth in Rule 10A-3(b)(1)(iv)(A) for companies registering securities in connection with an initial public offering;

WHEREAS, the Board, after careful deliberation and review of all relevant facts and circumstances, including questionnaires completed by each director candidate, background information, and disclosures regarding relationships with the Company, its management, and its significant stockholders, has determined that each of Warren Okoro, Catherine Liang, and Richard Estavez qualifies as "independent" within the meaning of Section 303A.02 of the NYSE Manual and Rule 10A-3 under the Exchange Act, and that none of them has any material relationship with the Company (either directly or as a partner, stockholder, or officer of an organization that has a relationship with the Company) that would interfere with the exercise of independent judgment in carrying out the responsibilities of an audit committee member;

WHEREAS, the Board has further determined that Warren Okoro qualifies as an "audit committee financial expert" within the meaning of Item 407(d)(5) of Regulation S-K promulgated by the SEC, by reason of his education, experience, and background, including his service as Chief Financial Officer of TerraGrid Energy Holdings, Inc. from 2011 to 2018, his prior experience as a senior audit manager at Severin Beck CPAs LLP from 2003 to 2011, his Certified Public Accountant designation (active license, State of New York, License No. 098274), and his Master of Business Administration degree with a concentration in accounting and finance from the Stern School of Business, New York University;

WHEREAS, the Board has determined that it is desirable and in the best interests of the Company and its stockholders to establish an Audit Committee of the Board (the "Audit Committee"), to appoint its initial members, and to designate an audit committee financial expert, in each case effective upon the closing of the IPO; and

WHEREAS, the Company intends to list its common stock on the New York Stock Exchange under the proposed ticker symbol "CBRI," and the establishment of the Audit Committee, the appointment of qualified independent members thereto, and the designation of an audit committee financial expert are conditions to satisfying the NYSE listing standards applicable to the Company, NYSE Application No. NYSE-2022-04218.

NOW, THEREFORE, BE IT RESOLVED, that the Board hereby adopts the following resolutions:

RESOLUTION 1: ESTABLISHMENT OF THE AUDIT COMMITTEE

RESOLVED, that the Board hereby establishes the Audit Committee of the Board of Directors of Calloway-Briggs Renewables Inc., effective upon the closing of the IPO.

The Audit Committee shall have the powers, duties, and responsibilities set forth in the Audit Committee Charter adopted by the Board (the "Charter"), a copy of which is attached hereto as Exhibit A and is incorporated herein by reference in its entirety.

The Audit Committee shall operate at all times in accordance with the Charter, the Company's Amended and Restated Certificate of Incorporation (to be effective upon the closing of the IPO), the Company's Amended and Restated Bylaws (to be effective upon the closing of the IPO), Section 303A.06 and Section 303A.07 of the NYSE Manual, Rule 10A-3 under the Exchange Act, the applicable provisions of the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act"), and all other applicable laws, rules, and regulations. To the extent of any inconsistency between the Charter and applicable law or regulation, the applicable law or regulation shall control.

RESOLUTION 2: APPOINTMENT OF AUDIT COMMITTEE MEMBERS

RESOLVED, that the following directors are hereby appointed as the initial members of the Audit Committee, effective upon the closing of the IPO:

RESOLVED FURTHER, that each of the foregoing persons has been determined by the Board, after due inquiry and deliberation, to satisfy each of the following requirements:

(a) the independence requirements set forth in Section 303A.02 of the NYSE Manual, including that none of such persons (i) is or has been within the last three years an employee of the Company, (ii) has an immediate family member who is or has been within the last three years an executive officer of the Company, (iii) has received, or has an immediate family member who has received, during any twelve-month period within the last three years, more than $120,000 in direct compensation from the Company, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service), (iv) is a current partner or employee of a firm that is the Company's internal or external auditor, or (v) has any other relationship that, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director;

(b) the independence requirements set forth in Rule 10A-3(b)(1) under the Exchange Act, including that none of such persons, other than in his or her capacity as a member of the Board, a member of any committee of the Board, or a participant in any separate committee of the Board established for a purpose consistent with the purposes of Rule 10A-3, (i) accepts directly or indirectly any consulting, advisory, or other compensatory fee from the Company or any subsidiary thereof, or (ii) is an affiliated person of the Company or any subsidiary thereof;

(c) the financial literacy requirements set forth in Section 303A.07(a) of the NYSE Manual, in that each such person is able to read and understand fundamental financial statements, including a company's balance sheet, income statement, and cash flow statement, and possesses a working familiarity with basic finance and accounting practices; and

(d) none of such persons is an affiliated person of the Company or any subsidiary thereof, other than in his or her capacity as a member of the Board or any committee of the Board.

RESOLVED FURTHER, that each member of the Audit Committee shall serve in such capacity until his or her respective successor is duly appointed and qualified, or until his or her earlier resignation, removal, or death, in accordance with the terms of the Charter and the Company's Amended and Restated Bylaws. The Board reserves the right to remove any member of the Audit Committee at any time, with or without cause, and to fill any vacancy on the Audit Committee with a director who satisfies the independence, financial literacy, and other requirements applicable to Audit Committee membership.

RESOLUTION 3: DESIGNATION OF AUDIT COMMITTEE FINANCIAL EXPERT

RESOLVED, that the Board hereby designates Warren Okoro as the "audit committee financial expert" of the Audit Committee within the meaning of Item 407(d)(5) of Regulation S-K promulgated by the SEC.

The Board has determined, after due inquiry and deliberation, that Mr. Okoro possesses each of the following attributes required under Item 407(d)(5)(ii) of Regulation S-K:

(a) an understanding of generally accepted accounting principles ("GAAP") and financial statements prepared in accordance therewith;

(b) the ability to assess the general application of GAAP in connection with the accounting for estimates, accruals, and reserves;

(c) experience preparing, auditing, analyzing, or evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the Company's financial statements, or experience actively supervising one or more persons engaged in such activities — the Board having specifically considered Mr. Okoro's tenure as Chief Financial Officer of TerraGrid Energy Holdings, Inc., a publicly traded energy company with revenues in excess of $1.2 billion, during which he was directly responsible for the preparation and oversight of the company's consolidated financial statements filed with the SEC, as well as his prior service as a senior audit manager at Severin Beck CPAs LLP, where he supervised audit engagements for multiple energy and utilities sector clients;

(d) an understanding of internal controls and procedures for financial reporting, including the design, implementation, and evaluation of such controls and procedures; and

(e) an understanding of audit committee functions, including the oversight of the independent audit process, the review of financial reporting practices, and the evaluation of the effectiveness of internal controls over financial reporting.

RESOLVED FURTHER, that Mr. Okoro acquired the foregoing attributes through a combination of education and experience, including the following:

(i) his active Certified Public Accountant license (State of New York, License No. 098274);

(ii) his Master of Business Administration degree with a concentration in accounting and finance from the Stern School of Business, New York University;

(iii) his service as Chief Financial Officer of TerraGrid Energy Holdings, Inc. from 2011 to 2018, during which he oversaw all aspects of financial reporting, internal audit, treasury, tax, and investor relations;

(iv) his service as a senior audit manager at Severin Beck CPAs LLP from 2003 to 2011, where he led audit engagements for public and private companies in the energy, utilities, and infrastructure sectors; and

(v) his service on the audit committees of two other public companies prior to joining the Board of the Company.

RESOLVED FURTHER, that the designation of Mr. Okoro as an "audit committee financial expert" does not impose upon him any duties, obligations, or liability that are greater than those imposed on him as a member of the Audit Committee and of the Board of Directors generally, and such designation does not affect the duties, obligations, or liability of any other member of the Audit Committee or the Board. This designation is made solely for purposes of compliance with and disclosure under Regulation S-K and the Exchange Act, and shall not be construed to create a higher standard of care or to expand the scope of fiduciary duties otherwise applicable to Mr. Okoro under the General Corporation Law of the State of Delaware.

RESOLVED FURTHER, that the designation of Mr. Okoro as an audit committee financial expert shall be disclosed in the Company's registration statement on Form S-1 and in its annual report on Form 10-K, and in each case as required by Item 407(d)(5) of Regulation S-K and as otherwise required by applicable SEC rules and regulations.

RESOLUTION 4: AUTHORITY AND RESPONSIBILITIES OF THE AUDIT COMMITTEE

RESOLVED, that the Audit Committee shall have the authority, duties, and responsibilities set forth in the Charter, which shall include, without limitation, the following:

(a) Independent Auditor Oversight. The Audit Committee shall have the sole authority to appoint, retain, compensate, evaluate, oversee the work of, and, where appropriate, terminate the Company's independent registered public accounting firm. The Company's current independent registered public accounting firm is Ashford & Pemberton LLP, with Gregory Sondheim, CPA, serving as lead engagement partner and Irene Valdez, CPA, serving as audit manager. The independent registered public accounting firm shall report directly to the Audit Committee.

(b) Pre-Approval of Services. The Audit Committee shall pre-approve all audit and permitted non-audit services to be performed by the independent registered public accounting firm, in accordance with Section 10A(i) of the Exchange Act and Rule 2-01(c)(7) of Regulation S-X, and shall establish policies and procedures for such pre-approval. The Audit Committee may delegate pre-approval authority to one or more of its members, provided that the decisions of any such member to whom authority is delegated shall be presented to the full Audit Committee at its next regularly scheduled meeting.

(c) Financial Statement Review. The Audit Committee shall review and discuss with management and the independent registered public accounting firm the Company's annual audited financial statements and quarterly unaudited financial statements, including the disclosures contained in "Management's Discussion and Analysis of Financial Condition and Results of Operations," prior to the filing of the Company's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, respectively, with the SEC.

(d) Earnings Releases and Guidance. The Audit Committee shall review the Company's earnings press releases and the type and presentation of financial information and earnings guidance provided to analysts, rating agencies, and the public, including the use of "pro forma" or "adjusted" non-GAAP financial measures.

(e) Internal Audit and Internal Controls. The Audit Committee shall have oversight responsibility for the Company's internal audit function and internal controls over financial reporting, including the assessment of the Company's readiness for compliance with Section 404 of the Sarbanes-Oxley Act and the rules promulgated thereunder. The Audit Committee shall discuss with management, the internal auditors, and the independent registered public accounting firm the adequacy and effectiveness of the Company's internal controls, including any significant deficiencies or material weaknesses in such controls, and any steps taken or proposed to be taken to remediate any such deficiencies or weaknesses.

(f) Risk Assessment and Risk Management. The Audit Committee shall discuss with management the Company's policies, guidelines, and processes governing risk assessment and risk management, including the Company's major financial and operational risk exposures and the steps management has taken or proposes to take to monitor and control such exposures.

(g) Related-Party Transactions. The Audit Committee shall review and oversee related-party transactions involving the Company in accordance with the Company's related-party transactions policy, as adopted or amended from time to time, and in accordance with Item 404 of Regulation S-K.

(h) Whistleblower Procedures. The Audit Committee shall establish and maintain procedures for the receipt, retention, and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters, including procedures for the confidential, anonymous submission of concerns by employees and other persons regarding questionable accounting or auditing matters, as required by Section 301 of the Sarbanes-Oxley Act and Rule 10A-3(b)(3) under the Exchange Act.

(i) Directors' and Officers' Insurance. The Audit Committee shall review the adequacy of the Company's directors' and officers' liability insurance coverage as it pertains to financial-reporting and audit-related risks. The Company's current D&O insurance program consists of a $50,000,000 aggregate tower structured as follows: (1) Meridian National Assurance Company, as primary carrier, Policy No. DNO-22-048871; (2) Stonebridge Indemnity Corp., as excess Layer 1; and (3) Commonwealth Omnivrel Insurance Ltd., as excess Layer 2. The Audit Committee shall receive at least annually a summary of the D&O insurance program from the Company's insurance broker and shall make recommendations to the Board regarding the adequacy of such coverage.

(j) Annual Charter Review. The Audit Committee shall annually review and reassess the adequacy of the Charter and shall recommend any proposed changes to the Board for its approval.

RESOLUTION 5: AUDIT COMMITTEE CHARTER ADOPTION

RESOLVED, that the Audit Committee Charter, in substantially the form attached hereto as Exhibit A, is hereby adopted and approved by the Board, effective upon the closing of the IPO. The Charter sets forth the purpose, composition, authority, duties, responsibilities, and operational procedures of the Audit Committee, consistent with the requirements of Section 303A.07 of the NYSE Manual, Rule 10A-3 under the Exchange Act, and the applicable provisions of the Sarbanes-Oxley Act.

RESOLVED FURTHER, that a copy of the Charter shall be made available on the Company's corporate website following the closing of the IPO, as required by Section 303A.14 of the NYSE Manual, and that the Company's annual proxy statement or annual report shall state that a current copy of the Charter is available on the Company's website, or shall include a copy of the Charter as an appendix at least once every three years.

RESOLVED FURTHER, that the Charter may be amended from time to time by the Board upon the recommendation of the Audit Committee, and the Board hereby authorizes the Audit Committee to conduct an annual review of the Charter and to recommend amendments thereto as the Audit Committee deems necessary or desirable in light of changes in applicable law, regulation, or best practices.

RESOLUTION 6: INDEPENDENT AUDITOR RELATIONSHIP

RESOLVED, that the Audit Committee is hereby directed, upon its formation at the closing of the IPO, to assume full oversight of the Company's relationship with Ashford & Pemberton LLP, an independent registered public accounting firm with offices at 30 Rockefeller Plaza, Suite 2800, New York, New York 10112, which currently serves as the Company's independent registered public accounting firm.

RESOLVED FURTHER, that the Board acknowledges that Ashford & Pemberton LLP has served as the auditor of the Company's consolidated financial statements for the fiscal years ended December 31, 2019, December 31, 2020, and December 31, 2021, and is providing the comfort letter and related procedures to the underwriters in connection with the IPO, with three circle-ups currently planned: (i) an initial comfort letter, (ii) a bring-down comfort letter, and (iii) a pricing comfort letter, in each case in accordance with the standards of the American Institute of Certified Public Accountants and the requirements of the underwriting agreement.

RESOLVED FURTHER, that the Audit Committee shall evaluate the independence, qualifications, and performance of Ashford & Pemberton LLP on an annual basis following the closing of the IPO, and shall take into account the opinions of management and the Company's internal auditors in making such evaluation. The Audit Committee shall ensure that the lead audit partner of Ashford & Pemberton LLP is subject to rotation in accordance with Section 203 of the Sarbanes-Oxley Act and Rule 2-01(c)(6) of Regulation S-X.

RESOLUTION 7: DISCLOSURE AUTHORIZATION

RESOLVED, that the officers of the Company, including Sandra Haverford, General Counsel and Corporate Secretary, and Marcus Yoon, Chief Financial Officer, are hereby authorized and directed to include appropriate disclosure regarding the establishment of the Audit Committee, the appointment of its members, the determination of each member's independence and financial literacy, and the designation of Warren Okoro as audit committee financial expert in the Company's registration statement on Form S-1 (SEC CIK No. 0001948372), any amendments or supplements thereto, the final prospectus, the definitive proxy statement, the annual report on Form 10-K, and any other filings with the SEC, the NYSE, or other applicable regulatory bodies as may be required or appropriate.

RESOLVED FURTHER, that such officers are authorized to make such conforming changes to the disclosure contained in the registration statement and other filings as may be necessary or advisable to reflect the resolutions adopted herein, subject to such modifications as may be approved by counsel to the Company and counsel to the underwriters.

RESOLUTION 8: GENERAL AUTHORIZATION

RESOLVED, that the officers of the Company, including Garrett Calloway, Chairman of the Board and Chief Executive Officer, Marcus Yoon, Chief Financial Officer, and Sandra Haverford, General Counsel and Corporate Secretary, are hereby authorized and directed, acting individually or collectively, to take any and all actions, and to execute and deliver any and all agreements, instruments, certificates, notices, consents, and other documents, as any of them may deem necessary, advisable, or appropriate to carry out the purposes and intent of the foregoing resolutions, the execution and delivery of any such document by any such officer to be conclusive evidence of his or her determination that such action is necessary, advisable, or appropriate.

RESOLVED FURTHER, that all actions heretofore taken by any officer or director of the Company in connection with the matters contemplated by these resolutions, including the preparation and filing of the confidential draft registration statement on Form S-1, the engagement of Ashford & Pemberton LLP, and the preliminary discussions with the NYSE regarding listing application NYSE-2022-04218, are hereby ratified, confirmed, and approved in all respects as the acts and deeds of the Company.

CERTIFICATION

The undersigned, Sandra Haverford, General Counsel and Corporate Secretary of Calloway-Briggs Renewables Inc., hereby certifies that the foregoing resolutions were duly adopted by the Board of Directors of Calloway-Briggs Renewables Inc. at a meeting of the Board duly called and held on September 14, 2022, at which a quorum of directors was present and acting throughout, and that such resolutions have not been modified, amended, or rescinded and remain in full force and effect as of the date hereof.

IN WITNESS WHEREOF, the undersigned has executed this certificate as of the date set forth below.

CALLOWAY-BRIGGS RENEWABLES INC.

By: ________

Name: Sandra Haverford

Title: General Counsel & Corporate Secretary

Date: ________

C&H Matter No. 1015-00001

EXHIBIT A

AUDIT COMMITTEE CHARTER

(Attached Separately)

The Audit Committee Charter of the Board of Directors of Calloway-Briggs Renewables Inc. is attached to these resolutions as Exhibit A and is incorporated herein by reference. The Charter, as adopted by the Board on September 14, 2022, effective upon the closing of the IPO, sets forth in full the purpose, composition, authority, duties, responsibilities, and operational procedures of the Audit Committee, consistent with the requirements of Section 303A.07 of the NYSE Listed Company Manual, Rule 10A-3 under the Securities Exchange Act of 1934, as amended, and the applicable provisions of the Sarbanes-Oxley Act of 2002.

The Charter provides, among other things, the following:

• The Audit Committee shall be composed of a minimum of three (3) members of the Board, each of whom shall be "independent" within the meaning of Section 303A.02 of the NYSE Manual and Rule 10A-3 under the Exchange Act.

• Each member of the Audit Committee shall be "financially literate" within the meaning of Section 303A.07(a) of the NYSE Manual, as determined by the Board in its business judgment, and at least one member of the Audit Committee shall be designated as an "audit committee financial expert" within the meaning of Item 407(d)(5) of Regulation S-K.

• The Audit Committee shall conduct an annual self-evaluation of its performance and the performance of its members, and shall report the results of such evaluation to the Board.

• The Audit Committee shall review and reassess the adequacy of the Charter on an annual basis and shall recommend any proposed amendments to the Board for its approval.

• The Charter specifies the Audit Committee's authority over the independent registered public accounting firm, its responsibilities regarding internal controls and financial reporting, and its role in risk oversight, compliance, and whistleblower matters, in each case as more fully described therein.

The complete text of the Charter is set forth in Exhibit A and should be reviewed in its entirety.

This document and all exhibits hereto are confidential and are subject to attorney-client privilege. This document has been prepared in connection with the proposed initial public offering of Calloway-Briggs Renewables Inc. and is not to be reproduced or distributed without the prior written consent of the Company and its counsel.

Member	Role	Status
Warren Okoro	Chairperson of the Audit Committee	Independent Director
Catherine Liang	Member	Independent Director
Richard Estavez	Member	Independent Director

RESOLUTIONS OF THE BOARD OF DIRECTORS OF CALLOWAY-BRIGGS RENEWABLES INC.
Establishment of Audit Committee, Appointment of Members, and Designation of Audit Committee Financial Expert
Adopted by the Board of Directors at a Meeting Duly Called and Held on September 14, 2022
The following resolutions were adopted by the Board of Directors (the "Board") of Calloway-Briggs Renewables Inc., a Delaware corporation (the "Company"), at a meeting of the Board duly called and held on September 14, 2022, at the principal offices of the Company, 4200 Ridgeline Parkway, Suite 1100, Austin, Texas 78746, at which a quorum was present and acting throughout. These resolutions are adopted in connection with the proposed initial public offering of common stock of the Company on the New York Stock Exchange under the proposed ticker symbol "CBRI."
RECITALS
WHEREAS, the Company is a corporation duly organized and existing under the laws of the State of Delaware, with its principal offices located at 4200 Ridgeline Parkway, Suite 1100, Austin, Texas 78746, and is registered in the State of Delaware with Capitol Statutory Services, Inc., 1209 Orange Street, Wilmington, Delaware 19801, serving as its registered agent for service of process;
WHEREAS, the Company, in connection with its proposed initial public offering of approximately $600,000,000 of common stock, par value $0.01 per share, on the New York Stock Exchange (the "IPO"), has filed a confidential draft registration statement on Form S-1 with the Securities and Exchange Commission (the "SEC") and anticipates amending and publicly filing such registration statement in due course;
WHEREAS, the Board currently consists of seven (7) members, as follows:
(i) Garrett Calloway — Co-Founder, Chairman of the Board, and Chief Executive Officer;
(ii) Elaine Briggs — Co-Founder and President, Development;
(iii) Hugh Pemberton — Director, designee of Pinnacle Vista Capital Partners III, LP;
(iv) Diane Kovac — Director, designee of Pinnacle Vista Capital Partners III, LP;
(v) Warren Okoro — Independent Director;
(vi) Catherine Liang — Independent Director; and
(vii) Richard Estavez — Independent Director;
WHEREAS, Section 303A of the New York Stock Exchange Listed Company Manual (the "NYSE Manual") requires that each listed company have an audit committee composed entirely of independent directors, subject to the controlled-company exemption set forth in Section 303A.00 and the applicable phase-in rules for companies listing in connection with an initial public offering as set forth in Section 303A.00(b) of the NYSE Manual;
WHEREAS, Rule 10A-3 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), requires that each member of the audit committee of a listed issuer be independent within the meaning of such rule, subject to the phase-in provisions set forth in Rule 10A-3(b)(1)(iv)(A) for companies registering securities in connection with an initial public offering;
WHEREAS, the Board, after careful deliberation and review of all relevant facts and circumstances, including questionnaires completed by each director candidate, background information, and disclosures regarding relationships with the Company, its management, and its significant stockholders, has determined that each of Warren Okoro, Catherine Liang, and Richard Estavez qualifies as "independent" within the meaning of Section 303A.02 of the NYSE Manual and Rule 10A-3 under the Exchange Act, and that none of them has any material relationship with the Company (either directly or as a partner, stockholder, or officer of an organization that has a relationship with the Company) that would interfere with the exercise of independent judgment in carrying out the responsibilities of an audit committee member;
WHEREAS, the Board has further determined that Warren Okoro qualifies as an "audit committee financial expert" within the meaning of Item 407(d)(5) of Regulation S-K promulgated by the SEC, by reason of his education, experience, and background, including his service as Chief Financial Officer of TerraGrid Energy Holdings, Inc. from 2011 to 2018, his prior experience as a senior audit manager at Severin Beck CPAs LLP from 2003 to 2011, his Certified Public Accountant designation (active license, State of New York, License No. 098274), and his Master of Business Administration degree with a concentration in accounting and finance from the Stern School of Business, New York University;
WHEREAS, the Board has determined that it is desirable and in the best interests of the Company and its stockholders to establish an Audit Committee of the Board (the "Audit Committee"), to appoint its initial members, and to designate an audit committee financial expert, in each case effective upon the closing of the IPO; and
WHEREAS, the Company intends to list its common stock on the New York Stock Exchange under the proposed ticker symbol "CBRI," and the establishment of the Audit Committee, the appointment of qualified independent members thereto, and the designation of an audit committee financial expert are conditions to satisfying the NYSE listing standards applicable to the Company, NYSE Application No. NYSE-2022-04218.
NOW, THEREFORE, BE IT RESOLVED, that the Board hereby adopts the following resolutions:
RESOLUTION 1: ESTABLISHMENT OF THE AUDIT COMMITTEE
RESOLVED, that the Board hereby establishes the Audit Committee of the Board of Directors of Calloway-Briggs Renewables Inc., effective upon the closing of the IPO.
The Audit Committee shall have the powers, duties, and responsibilities set forth in the Audit Committee Charter adopted by the Board (the "Charter"), a copy of which is attached hereto as Exhibit A and is incorporated herein by reference in its entirety.
The Audit Committee shall operate at all times in accordance with the Charter, the Company's Amended and Restated Certificate of Incorporation (to be effective upon the closing of the IPO), the Company's Amended and Restated Bylaws (to be effective upon the closing of the IPO), Section 303A.06 and Section 303A.07 of the NYSE Manual, Rule 10A-3 under the Exchange Act, the applicable provisions of the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act"), and all other applicable laws, rules, and regulations. To the extent of any inconsistency between the Charter and applicable law or regulation, the applicable law or regulation shall control.
RESOLUTION 2: APPOINTMENT OF AUDIT COMMITTEE MEMBERS
RESOLVED, that the following directors are hereby appointed as the initial members of the Audit Committee, effective upon the closing of the IPO:
RESOLVED FURTHER, that each of the foregoing persons has been determined by the Board, after due inquiry and deliberation, to satisfy each of the following requirements:
(a) the independence requirements set forth in Section 303A.02 of the NYSE Manual, including that none of such persons (i) is or has been within the last three years an employee of the Company, (ii) has an immediate family member who is or has been within the last three years an executive officer of the Company, (iii) has received, or has an immediate family member who has received, during any twelve-month period within the last three years, more than $120,000 in direct compensation from the Company, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service), (iv) is a current partner or employee of a firm that is the Company's internal or external auditor, or (v) has any other relationship that, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director;
(b) the independence requirements set forth in Rule 10A-3(b)(1) under the Exchange Act, including that none of such persons, other than in his or her capacity as a member of the Board, a member of any committee of the Board, or a participant in any separate committee of the Board established for a purpose consistent with the purposes of Rule 10A-3, (i) accepts directly or indirectly any consulting, advisory, or other compensatory fee from the Company or any subsidiary thereof, or (ii) is an affiliated person of the Company or any subsidiary thereof;
(c) the financial literacy requirements set forth in Section 303A.07(a) of the NYSE Manual, in that each such person is able to read and understand fundamental financial statements, including a company's balance sheet, income statement, and cash flow statement, and possesses a working familiarity with basic finance and accounting practices; and
(d) none of such persons is an affiliated person of the Company or any subsidiary thereof, other than in his or her capacity as a member of the Board or any committee of the Board.
RESOLVED FURTHER, that each member of the Audit Committee shall serve in such capacity until his or her respective successor is duly appointed and qualified, or until his or her earlier resignation, removal, or death, in accordance with the terms of the Charter and the Company's Amended and Restated Bylaws. The Board reserves the right to remove any member of the Audit Committee at any time, with or without cause, and to fill any vacancy on the Audit Committee with a director who satisfies the independence, financial literacy, and other requirements applicable to Audit Committee membership.
RESOLUTION 3: DESIGNATION OF AUDIT COMMITTEE FINANCIAL EXPERT
RESOLVED, that the Board hereby designates Warren Okoro as the "audit committee financial expert" of the Audit Committee within the meaning of Item 407(d)(5) of Regulation S-K promulgated by the SEC.
The Board has determined, after due inquiry and deliberation, that Mr. Okoro possesses each of the following attributes required under Item 407(d)(5)(ii) of Regulation S-K:
(a) an understanding of generally accepted accounting principles ("GAAP") and financial statements prepared in accordance therewith;
(b) the ability to assess the general application of GAAP in connection with the accounting for estimates, accruals, and reserves;
(c) experience preparing, auditing, analyzing, or evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the Company's financial statements, or experience actively supervising one or more persons engaged in such activities — the Board having specifically considered Mr. Okoro's tenure as Chief Financial Officer of TerraGrid Energy Holdings, Inc., a publicly traded energy company with revenues in excess of $1.2 billion, during which he was directly responsible for the preparation and oversight of the company's consolidated financial statements filed with the SEC, as well as his prior service as a senior audit manager at Severin Beck CPAs LLP, where he supervised audit engagements for multiple energy and utilities sector clients;
(d) an understanding of internal controls and procedures for financial reporting, including the design, implementation, and evaluation of such controls and procedures; and
(e) an understanding of audit committee functions, including the oversight of the independent audit process, the review of financial reporting practices, and the evaluation of the effectiveness of internal controls over financial reporting.
RESOLVED FURTHER, that Mr. Okoro acquired the foregoing attributes through a combination of education and experience, including the following:
(i) his active Certified Public Accountant license (State of New York, License No. 098274);
(ii) his Master of Business Administration degree with a concentration in accounting and finance from the Stern School of Business, New York University;
(iii) his service as Chief Financial Officer of TerraGrid Energy Holdings, Inc. from 2011 to 2018, during which he oversaw all aspects of financial reporting, internal audit, treasury, tax, and investor relations;
(iv) his service as a senior audit manager at Severin Beck CPAs LLP from 2003 to 2011, where he led audit engagements for public and private companies in the energy, utilities, and infrastructure sectors; and
(v) his service on the audit committees of two other public companies prior to joining the Board of the Company.
RESOLVED FURTHER, that the designation of Mr. Okoro as an "audit committee financial expert" does not impose upon him any duties, obligations, or liability that are greater than those imposed on him as a member of the Audit Committee and of the Board of Directors generally, and such designation does not affect the duties, obligations, or liability of any other member of the Audit Committee or the Board. This designation is made solely for purposes of compliance with and disclosure under Regulation S-K and the Exchange Act, and shall not be construed to create a higher standard of care or to expand the scope of fiduciary duties otherwise applicable to Mr. Okoro under the General Corporation Law of the State of Delaware.
RESOLVED FURTHER, that the designation of Mr. Okoro as an audit committee financial expert shall be disclosed in the Company's registration statement on Form S-1 and in its annual report on Form 10-K, and in each case as required by Item 407(d)(5) of Regulation S-K and as otherwise required by applicable SEC rules and regulations.
RESOLUTION 4: AUTHORITY AND RESPONSIBILITIES OF THE AUDIT COMMITTEE
RESOLVED, that the Audit Committee shall have the authority, duties, and responsibilities set forth in the Charter, which shall include, without limitation, the following:
(a) Independent Auditor Oversight. The Audit Committee shall have the sole authority to appoint, retain, compensate, evaluate, oversee the work of, and, where appropriate, terminate the Company's independent registered public accounting firm. The Company's current independent registered public accounting firm is Ashford & Pemberton LLP, with Gregory Sondheim, CPA, serving as lead engagement partner and Irene Valdez, CPA, serving as audit manager. The independent registered public accounting firm shall report directly to the Audit Committee.
(b) Pre-Approval of Services. The Audit Committee shall pre-approve all audit and permitted non-audit services to be performed by the independent registered public accounting firm, in accordance with Section 10A(i) of the Exchange Act and Rule 2-01(c)(7) of Regulation S-X, and shall establish policies and procedures for such pre-approval. The Audit Committee may delegate pre-approval authority to one or more of its members, provided that the decisions of any such member to whom authority is delegated shall be presented to the full Audit Committee at its next regularly scheduled meeting.
(c) Financial Statement Review. The Audit Committee shall review and discuss with management and the independent registered public accounting firm the Company's annual audited financial statements and quarterly unaudited financial statements, including the disclosures contained in "Management's Discussion and Analysis of Financial Condition and Results of Operations," prior to the filing of the Company's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, respectively, with the SEC.
(d) Earnings Releases and Guidance. The Audit Committee shall review the Company's earnings press releases and the type and presentation of financial information and earnings guidance provided to analysts, rating agencies, and the public, including the use of "pro forma" or "adjusted" non-GAAP financial measures.
(e) Internal Audit and Internal Controls. The Audit Committee shall have oversight responsibility for the Company's internal audit function and internal controls over financial reporting, including the assessment of the Company's readiness for compliance with Section 404 of the Sarbanes-Oxley Act and the rules promulgated thereunder. The Audit Committee shall discuss with management, the internal auditors, and the independent registered public accounting firm the adequacy and effectiveness of the Company's internal controls, including any significant deficiencies or material weaknesses in such controls, and any steps taken or proposed to be taken to remediate any such deficiencies or weaknesses.
(f) Risk Assessment and Risk Management. The Audit Committee shall discuss with management the Company's policies, guidelines, and processes governing risk assessment and risk management, including the Company's major financial and operational risk exposures and the steps management has taken or proposes to take to monitor and control such exposures.
(g) Related-Party Transactions. The Audit Committee shall review and oversee related-party transactions involving the Company in accordance with the Company's related-party transactions policy, as adopted or amended from time to time, and in accordance with Item 404 of Regulation S-K.
(h) Whistleblower Procedures. The Audit Committee shall establish and maintain procedures for the receipt, retention, and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters, including procedures for the confidential, anonymous submission of concerns by employees and other persons regarding questionable accounting or auditing matters, as required by Section 301 of the Sarbanes-Oxley Act and Rule 10A-3(b)(3) under the Exchange Act.
(i) Directors' and Officers' Insurance. The Audit Committee shall review the adequacy of the Company's directors' and officers' liability insurance coverage as it pertains to financial-reporting and audit-related risks. The Company's current D&O insurance program consists of a $50,000,000 aggregate tower structured as follows: (1) Meridian National Assurance Company, as primary carrier, Policy No. DNO-22-048871; (2) Stonebridge Indemnity Corp., as excess Layer 1; and (3) Commonwealth Omnivrel Insurance Ltd., as excess Layer 2. The Audit Committee shall receive at least annually a summary of the D&O insurance program from the Company's insurance broker and shall make recommendations to the Board regarding the adequacy of such coverage.
(j) Annual Charter Review. The Audit Committee shall annually review and reassess the adequacy of the Charter and shall recommend any proposed changes to the Board for its approval.
RESOLUTION 5: AUDIT COMMITTEE CHARTER ADOPTION
RESOLVED, that the Audit Committee Charter, in substantially the form attached hereto as Exhibit A, is hereby adopted and approved by the Board, effective upon the closing of the IPO. The Charter sets forth the purpose, composition, authority, duties, responsibilities, and operational procedures of the Audit Committee, consistent with the requirements of Section 303A.07 of the NYSE Manual, Rule 10A-3 under the Exchange Act, and the applicable provisions of the Sarbanes-Oxley Act.
RESOLVED FURTHER, that a copy of the Charter shall be made available on the Company's corporate website following the closing of the IPO, as required by Section 303A.14 of the NYSE Manual, and that the Company's annual proxy statement or annual report shall state that a current copy of the Charter is available on the Company's website, or shall include a copy of the Charter as an appendix at least once every three years.
RESOLVED FURTHER, that the Charter may be amended from time to time by the Board upon the recommendation of the Audit Committee, and the Board hereby authorizes the Audit Committee to conduct an annual review of the Charter and to recommend amendments thereto as the Audit Committee deems necessary or desirable in light of changes in applicable law, regulation, or best practices.
RESOLUTION 6: INDEPENDENT AUDITOR RELATIONSHIP
RESOLVED, that the Audit Committee is hereby directed, upon its formation at the closing of the IPO, to assume full oversight of the Company's relationship with Ashford & Pemberton LLP, an independent registered public accounting firm with offices at 30 Rockefeller Plaza, Suite 2800, New York, New York 10112, which currently serves as the Company's independent registered public accounting firm.
RESOLVED FURTHER, that the Board acknowledges that Ashford & Pemberton LLP has served as the auditor of the Company's consolidated financial statements for the fiscal years ended December 31, 2019, December 31, 2020, and December 31, 2021, and is providing the comfort letter and related procedures to the underwriters in connection with the IPO, with three circle-ups currently planned: (i) an initial comfort letter, (ii) a bring-down comfort letter, and (iii) a pricing comfort letter, in each case in accordance with the standards of the American Institute of Certified Public Accountants and the requirements of the underwriting agreement.
RESOLVED FURTHER, that the Audit Committee shall evaluate the independence, qualifications, and performance of Ashford & Pemberton LLP on an annual basis following the closing of the IPO, and shall take into account the opinions of management and the Company's internal auditors in making such evaluation. The Audit Committee shall ensure that the lead audit partner of Ashford & Pemberton LLP is subject to rotation in accordance with Section 203 of the Sarbanes-Oxley Act and Rule 2-01(c)(6) of Regulation S-X.
RESOLUTION 7: DISCLOSURE AUTHORIZATION
RESOLVED, that the officers of the Company, including Sandra Haverford, General Counsel and Corporate Secretary, and Marcus Yoon, Chief Financial Officer, are hereby authorized and directed to include appropriate disclosure regarding the establishment of the Audit Committee, the appointment of its members, the determination of each member's independence and financial literacy, and the designation of Warren Okoro as audit committee financial expert in the Company's registration statement on Form S-1 (SEC CIK No. 0001948372), any amendments or supplements thereto, the final prospectus, the definitive proxy statement, the annual report on Form 10-K, and any other filings with the SEC, the NYSE, or other applicable regulatory bodies as may be required or appropriate.
RESOLVED FURTHER, that such officers are authorized to make such conforming changes to the disclosure contained in the registration statement and other filings as may be necessary or advisable to reflect the resolutions adopted herein, subject to such modifications as may be approved by counsel to the Company and counsel to the underwriters.
RESOLUTION 8: GENERAL AUTHORIZATION
RESOLVED, that the officers of the Company, including Garrett Calloway, Chairman of the Board and Chief Executive Officer, Marcus Yoon, Chief Financial Officer, and Sandra Haverford, General Counsel and Corporate Secretary, are hereby authorized and directed, acting individually or collectively, to take any and all actions, and to execute and deliver any and all agreements, instruments, certificates, notices, consents, and other documents, as any of them may deem necessary, advisable, or appropriate to carry out the purposes and intent of the foregoing resolutions, the execution and delivery of any such document by any such officer to be conclusive evidence of his or her determination that such action is necessary, advisable, or appropriate.
RESOLVED FURTHER, that all actions heretofore taken by any officer or director of the Company in connection with the matters contemplated by these resolutions, including the preparation and filing of the confidential draft registration statement on Form S-1, the engagement of Ashford & Pemberton LLP, and the preliminary discussions with the NYSE regarding listing application NYSE-2022-04218, are hereby ratified, confirmed, and approved in all respects as the acts and deeds of the Company.
CERTIFICATION
The undersigned, Sandra Haverford, General Counsel and Corporate Secretary of Calloway-Briggs Renewables Inc., hereby certifies that the foregoing resolutions were duly adopted by the Board of Directors of Calloway-Briggs Renewables Inc. at a meeting of the Board duly called and held on September 14, 2022, at which a quorum of directors was present and acting throughout, and that such resolutions have not been modified, amended, or rescinded and remain in full force and effect as of the date hereof.
IN WITNESS WHEREOF, the undersigned has executed this certificate as of the date set forth below.
CALLOWAY-BRIGGS RENEWABLES INC.
By: ________
Name: Sandra Haverford
Title: General Counsel & Corporate Secretary
Date: ________
C&H Matter No. 1015-00001
EXHIBIT A
AUDIT COMMITTEE CHARTER
(Attached Separately)
The Audit Committee Charter of the Board of Directors of Calloway-Briggs Renewables Inc. is attached to these resolutions as Exhibit A and is incorporated herein by reference. The Charter, as adopted by the Board on September 14, 2022, effective upon the closing of the IPO, sets forth in full the purpose, composition, authority, duties, responsibilities, and operational procedures of the Audit Committee, consistent with the requirements of Section 303A.07 of the NYSE Listed Company Manual, Rule 10A-3 under the Securities Exchange Act of 1934, as amended, and the applicable provisions of the Sarbanes-Oxley Act of 2002.
The Charter provides, among other things, the following:
•  The Audit Committee shall be composed of a minimum of three (3) members of the Board, each of whom shall be "independent" within the meaning of Section 303A.02 of the NYSE Manual and Rule 10A-3 under the Exchange Act.
•  Each member of the Audit Committee shall be "financially literate" within the meaning of Section 303A.07(a) of the NYSE Manual, as determined by the Board in its business judgment, and at least one member of the Audit Committee shall be designated as an "audit committee financial expert" within the meaning of Item 407(d)(5) of Regulation S-K.
•  The Audit Committee shall conduct an annual self-evaluation of its performance and the performance of its members, and shall report the results of such evaluation to the Board.
•  The Audit Committee shall review and reassess the adequacy of the Charter on an annual basis and shall recommend any proposed amendments to the Board for its approval.
•  The Charter specifies the Audit Committee's authority over the independent registered public accounting firm, its responsibilities regarding internal controls and financial reporting, and its role in risk oversight, compliance, and whistleblower matters, in each case as more fully described therein.
The complete text of the Charter is set forth in Exhibit A and should be reviewed in its entirety.
This document and all exhibits hereto are confidential and are subject to attorney-client privilege. This document has been prepared in connection with the proposed initial public offering of Calloway-Briggs Renewables Inc. and is not to be reproduced or distributed without the prior written consent of the Company and its counsel.
Member | Role | Status
Warren Okoro | Chairperson of the Audit Committee | Independent Director
Catherine Liang | Member | Independent Director
Richard Estavez | Member | Independent Director