1015-00001 · Graymont Brothers Inc · Debt & Lender Consents

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[DRAFT — FOR DISCUSSION PURPOSES ONLY]

CONSENT AND WAIVER

Dated as of [●], 2022

among

CALLOWAY-BRIGGS RENEWABLES INC., as Borrower,

CBR HOLDINGS LLC,

CALLOWAY-BRIGGS OPERATING COMPANY LLC,

each of the other Guarantors party hereto,

and

VELTRANO NATIONAL BANK, as Administrative Agent

Reference is made to the Credit Agreement described herein

CONSENT AND WAIVER

This CONSENT AND WAIVER (this "Consent and Waiver"), dated as of [●], 2022, is entered into by and among CALLOWAY-BRIGGS RENEWABLES INC., a Delaware corporation (the "Borrower"), CBR HOLDINGS LLC, a Delaware limited liability company ("CBR Holdings"), CALLOWAY-BRIGGS OPERATING COMPANY LLC, a Texas limited liability company ("CBR Operating," and together with CBR Holdings, the "Subsidiary Guarantors"), each of the other Guarantors party hereto (together with the Subsidiary Guarantors, the "Guarantors"), and VELTRANO NATIONAL BANK, a national banking association, in its capacity as Administrative Agent (the "Administrative Agent") under that certain Credit Agreement, dated as of January [●], 2022 (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"), among the Borrower, CBR Holdings, CBR Operating, each of the Guarantors party thereto, the Lenders party thereto, and the Administrative Agent.

The Credit Agreement governs (a) the $400,000,000 Corporate Revolving Credit Facility (the "Revolving Credit Facility"), with a maturity date of January [●], 2027, and (b) the $650,000,000 Corporate Term Loan B (the "Term Loan B"), with a maturity date of January [●], 2029, of which approximately $612,500,000 is currently outstanding as of the date hereof. All notices and communications to the Administrative Agent in connection with this Consent and Waiver and the Credit Agreement shall be directed to: Veltrano National Bank, 1401 McKinney Street, Houston, TX 77010, Attention: Thomas Raines, Managing Director, Energy Lending.

RECITALS

WHEREAS:

A. The Borrower, CBR Holdings, CBR Operating, the Guarantors, the Lenders, and the Administrative Agent are parties to the Credit Agreement, dated as of January [●], 2022, pursuant to which the Lenders have made available to the Borrower the credit facilities described therein. Capitalized terms used but not otherwise defined in this Consent and Waiver shall have the respective meanings ascribed to such terms in the Credit Agreement.

B. The Borrower has informed the Administrative Agent that it proposes to consummate an initial public offering (the "IPO") of shares of its common stock, par value $0.01 per share (the "Common Stock"), on the New York Stock Exchange (the "NYSE") under the proposed ticker symbol "CBRI." The anticipated aggregate offering size of the IPO is approximately $600,000,000 (inclusive of a 15% overallotment option granted to the underwriters). The IPO will consist of: (i) a primary offering by the Borrower of approximately $371,700,000 of Common Stock (approximately 16,895,455 shares at an assumed offering price of $22.00 per share) and (ii) a secondary offering by Pinnacle Vista Capital Partners III, LP ("Pinnacle Vista"), the Borrower's majority stockholder, of approximately $150,000,000 of Common Stock (approximately 6,818,182 shares at an assumed offering price of $22.00 per share). The Borrower intends to use approximately $200,000,000 of the net proceeds from the primary offering to prepay a portion of the outstanding Term Loan B, with the remainder of such net proceeds to be applied to fund the construction of the Cimarron Solar project (approximately $100,000,000) and for general corporate purposes (approximately $71,700,000). A summary of the material terms and details of the IPO is set forth on Schedule A attached hereto.

C. Section [●] of the Credit Agreement contains a definition of "Change of Control" that may be triggered by the IPO and the resulting change in ownership percentages of the Borrower, including the dilution of Pinnacle Vista's ownership percentage from approximately 62% to approximately 49% on a base offering basis (or approximately 47% assuming full exercise of the overallotment option). Section [●] of the Credit Agreement requires the consent of the Administrative Agent (acting at the direction of the Required Lenders) for any Change of Control event and provides that the occurrence of a Change of Control without such consent constitutes an Event of Default under the Credit Agreement. Section [●] of the Credit Agreement contains certain negative covenants regarding the issuance of equity interests by the Borrower, which may restrict the Borrower's ability to consummate the issuance of shares of Common Stock in the IPO and under related equity incentive plans without the prior consent of the Administrative Agent and the Required Lenders. The Borrower has requested that (i) the Administrative Agent and the Required Lenders consent to the IPO and the related transactions and (ii) waive any Default or Event of Default that would otherwise arise under the Credit Agreement solely as a result of the consummation of the IPO.

D. In connection with the foregoing, the Borrower has submitted a formal consent request letter dated [●], 2022 (the "Consent Request Letter"), prepared by Calderwood & Harkness LLP, counsel to the Borrower (with offices at 599 Lexington Avenue, New York, NY 10022), addressed to Thomas Raines at Veltrano National Bank, requesting the consent and waiver contemplated hereby. The Administrative Agent, acting at the direction of the Required Lenders, has agreed to grant such consent and waiver, subject to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the foregoing premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

Section 1 — Definitions

As used in this Consent and Waiver, the following terms shall have the following meanings:

"Consent and Waiver" means this Consent and Waiver, dated as of [●], 2022, among the Borrower, the Guarantors, and the Administrative Agent, as the same may be amended, restated, supplemented, or otherwise modified from time to time in accordance with the terms hereof.

"Consent Effective Date" means the first date on which each of the conditions set forth in Section 4 hereof has been satisfied or waived by the Administrative Agent in its sole discretion.

"Credit Agreement" has the meaning assigned to such term in the preamble hereto.

"IPO" means the initial public offering of the Borrower's Common Stock as described in Recital B hereto and as more fully set forth on Schedule A attached hereto.

"IPO Closing Date" means the date on which the closing of the IPO occurs, including the delivery of shares of Common Stock to the purchasers thereof against payment of the purchase price therefor.

"IPO Transactions" means, collectively, (a) the filing and effectiveness of the Registration Statement on Form S-1 (and any amendments or supplements thereto) with the United States Securities and Exchange Commission (the "SEC"), (b) the offering, issuance, and sale of shares of Common Stock in the IPO (including any shares sold pursuant to the exercise of the overallotment option by the underwriters), (c) the sale of secondary shares of Common Stock by Pinnacle Vista in the IPO, (d) the application of net proceeds from the IPO as described in the Recitals hereto (including the prepayment of approximately $200,000,000 of the outstanding principal amount of the Term Loan B), (e) the adoption of the Amended and Restated Certificate of Incorporation of the Borrower and the Amended and Restated Bylaws of the Borrower (each, as in effect on the IPO Closing Date), (f) the entry into or effectiveness of the Amended and Restated Stockholders' Agreement among the Borrower, Pinnacle Vista, and the other parties thereto, the Registration Rights Agreement among the Borrower, Pinnacle Vista, and the other parties thereto, the Underwriting Agreement among the Borrower, Pinnacle Vista, and the underwriters named therein, the Lock-Up Agreements entered into by the Borrower's directors, officers, and certain stockholders, the 2022 Omnibus Equity Incentive Plan, and the 2022 Employee Stock Purchase Plan, and (g) all related corporate actions, resolutions, filings with governmental authorities, and ancillary transactions reasonably necessary or advisable to consummate the foregoing.

All other capitalized terms used but not otherwise defined in this Consent and Waiver shall have the respective meanings ascribed to such terms in the Credit Agreement, and the rules of construction set forth in Section [●] of the Credit Agreement shall apply to this Consent and Waiver mutatis mutandis.

Section 2 — Consent

2.1 Consent to the IPO and Change of Control. The Administrative Agent, acting at the direction of the Required Lenders, hereby consents to the IPO Transactions and agrees that the consummation of the IPO Transactions shall not constitute a "Change of Control" (as defined in the Credit Agreement) or trigger any mandatory prepayment obligation, Default, Event of Default, or other adverse consequence arising from or related to a Change of Control under the Credit Agreement or any other Loan Document. Without limiting the generality of the foregoing, this consent applies specifically to: (i) the issuance of new shares of Common Stock by the Borrower in the primary offering (up to 19,429,773 shares on a base offering basis, or up to 22,989,318 shares assuming exercise of the overallotment option with respect to primary shares, and in any event not exceeding 27,272,727 shares in the aggregate assuming full exercise of the overallotment option applicable to both primary and secondary shares), (ii) the sale of secondary shares of Common Stock by Pinnacle Vista (up to 6,818,182 shares), (iii) the listing of the Common Stock on the NYSE under the proposed ticker symbol "CBRI," and (iv) any resulting dilution of existing stockholders' ownership percentages (including, without limitation, the reduction of Pinnacle Vista's ownership of the Borrower from approximately 62% of the outstanding Common Stock immediately prior to the IPO to approximately 49% of the outstanding Common Stock on a base offering basis, or approximately 47% of the outstanding Common Stock assuming full exercise of the overallotment option). The Administrative Agent and the Required Lenders acknowledge and agree that the reduction in Pinnacle Vista's ownership percentage described in this Section 2.1 shall not, in and of itself, give rise to any right of the Administrative Agent or any Lender to accelerate the obligations under the Credit Agreement, demand any mandatory prepayment (other than the voluntary prepayment described in Section 2.3 hereof), or exercise any other remedy under the Credit Agreement or any other Loan Document.

2.2 Consent to Issuance of Equity Interests. To the extent that the issuance of shares of Common Stock in the IPO, or the reservation and issuance of shares of Common Stock pursuant to the Borrower's 2022 Omnibus Equity Incentive Plan (under which up to 12,727,273 shares of Common Stock will be reserved for issuance) or the Borrower's 2022 Employee Stock Purchase Plan (under which up to 2,545,455 shares of Common Stock will be reserved for issuance), would otherwise require consent under Section [●] or any other negative covenant of the Credit Agreement restricting the issuance of Equity Interests (as defined in the Credit Agreement) by the Borrower or any of its Subsidiaries, such consent is hereby granted by the Administrative Agent, acting at the direction of the Required Lenders. This consent extends to all shares of Common Stock that may be issued from time to time pursuant to awards granted under the 2022 Omnibus Equity Incentive Plan or purchases made under the 2022 Employee Stock Purchase Plan, in each case in accordance with the terms of such plans as in effect on the IPO Closing Date (or as subsequently amended in a manner not materially adverse to the Lenders).

2.3 Consent to Use of Proceeds and Prepayment. The Administrative Agent, acting at the direction of the Required Lenders, hereby consents to the application of approximately $200,000,000 of the net proceeds from the IPO to prepay a portion of the outstanding principal amount of the Term Loan B in accordance with the voluntary prepayment provisions of Section [●] of the Credit Agreement. The Administrative Agent acknowledges that such prepayment shall be subject to the applicable prepayment premium of 1.00% of the principal amount prepaid (i.e., $2,000,000), as set forth in Section [●] of the Credit Agreement, and that such prepayment premium shall be paid by the Borrower concurrently with or promptly following the application of such net proceeds. The parties hereby confirm that, after giving effect to such prepayment, the outstanding principal balance of the Term Loan B will be reduced from approximately $612,500,000 to approximately $412,500,000. The Administrative Agent further acknowledges and consents to the application of the remaining net proceeds from the IPO for the purposes described in the Recitals, including the funding of construction costs associated with the Cimarron Solar project (approximately $100,000,000) and for general corporate purposes (approximately $71,700,000). Nothing in this Section 2.3 shall be construed to modify or waive any obligation of the Borrower to comply with the mandatory prepayment provisions of the Credit Agreement with respect to any future event or transaction other than the IPO Transactions.

2.4 Consent to Charter and Governance Changes. The Administrative Agent, acting at the direction of the Required Lenders, hereby consents to the adoption of the Amended and Restated Certificate of Incorporation and the Amended and Restated Bylaws of the Borrower in connection with the IPO, to the extent such amendments would otherwise require consent under Section [●] or any other provision of the Credit Agreement. This consent is granted on the understanding that the Borrower has provided, or will provide prior to the Consent Effective Date, copies of the Amended and Restated Certificate of Incorporation and the Amended and Restated Bylaws in substantially final form to the Administrative Agent for its review. The Administrative Agent reserves the right to withdraw this consent if the final forms of such documents differ in any material respect from the drafts provided to the Administrative Agent prior to the date hereof.

Section 3 — Waiver

3.1 Waiver of Default. The Administrative Agent, acting at the direction of the Required Lenders, hereby waives any Default or Event of Default under the Credit Agreement that would arise solely as a result of the consummation of the IPO Transactions (including, without limitation, any Default or Event of Default arising under (a) the Change of Control provision set forth in Section [●] of the Credit Agreement, (b) the negative covenant restricting the issuance of Equity Interests set forth in Section [●] of the Credit Agreement, (c) any reporting, notice, or information delivery requirement under the Credit Agreement, in each case solely to the extent such Default or Event of Default is triggered by the IPO Transactions), provided that such waiver shall be effective only upon the occurrence of the Consent Effective Date and only with respect to the specific Defaults or Events of Default described herein. For the avoidance of doubt, this waiver extends to any Default or Event of Default that would arise under the Credit Agreement as a result of the reduction in Pinnacle Vista's ownership of the outstanding Common Stock of the Borrower to below any applicable threshold set forth in the definition of "Change of Control" in the Credit Agreement, solely as a consequence of the issuance and sale of shares of Common Stock in the IPO.

3.2 Limited Waiver. The waiver set forth in Section 3.1 hereof is limited solely to the IPO Transactions described herein and shall not constitute a waiver of (a) any other Default or Event of Default, whether currently existing or arising in the future, (b) any right or remedy of the Administrative Agent or any Lender under the Credit Agreement or any other Loan Document (other than to the limited extent expressly waived herein), or (c) any provision of the Credit Agreement or any other Loan Document (other than to the limited extent expressly waived herein). This waiver shall not be deemed to establish a custom or course of dealing between the parties, and shall not obligate the Administrative Agent or any Lender to grant any future consent, waiver, amendment, or modification with respect to any provision of the Credit Agreement or any other Loan Document, whether or not the circumstances are similar to those giving rise to this waiver. The Administrative Agent and the Required Lenders expressly reserve all of their rights and remedies under the Credit Agreement and the other Loan Documents, at law, and in equity, except to the limited extent expressly waived herein.

Section 4 — Conditions to Effectiveness

The consent and waiver set forth in Sections 2 and 3 hereof shall become effective on the Consent Effective Date, which shall be the first date on which each of the following conditions has been satisfied (or waived by the Administrative Agent in writing):

4.1 Execution and Delivery. The Administrative Agent shall have received a counterpart of this Consent and Waiver duly executed and delivered by each of the Borrower, CBR Holdings LLC, Calloway-Briggs Operating Company LLC, and each other Guarantor party to the Credit Agreement (including, without limitation, each of the project-level subsidiary Guarantors identified on the signature pages hereof).

4.2 Registration Statement. The Administrative Agent shall have received evidence reasonably satisfactory to it (which may include a copy of the EDGAR filing confirmation) of the filing of the Registration Statement on Form S-1 with the SEC by the Borrower (SEC CIK No. 0001948372), together with a copy of such Registration Statement as filed.

4.3 Underwriting Agreement. The Administrative Agent shall have received a copy of the Underwriting Agreement among the Borrower, Pinnacle Vista, and the underwriters named therein, in substantially final form, together with a certificate of an authorized officer of the Borrower confirming that such Underwriting Agreement does not contain any terms or provisions that are materially adverse to the interests of the Lenders under the Credit Agreement.

4.4 Officer's Certificate. The Administrative Agent shall have received a certificate of an authorized officer of the Borrower (the "Officer's Certificate"), in form and substance reasonably satisfactory to the Administrative Agent, certifying that: (a) each of the representations and warranties of the Borrower and each other Loan Party set forth in the Credit Agreement and the other Loan Documents is true and correct in all material respects as of the Consent Effective Date (or, in the case of any representation or warranty that is qualified by materiality or "Material Adverse Effect," true and correct in all respects), except to the extent that such representations and warranties expressly relate to a specific earlier date, in which case such representations and warranties shall be true and correct in all material respects (or, as applicable, in all respects) as of such earlier date; and (b) no Default or Event of Default has occurred and is continuing as of the Consent Effective Date (other than those Defaults or Events of Default being waived by this Consent and Waiver).

4.5 Prepayment Premium. The Administrative Agent shall have received evidence reasonably satisfactory to it that the Borrower has paid (or will pay simultaneously with the IPO Closing Date) the applicable prepayment premium of $2,000,000 (representing 1.00% of the $200,000,000 principal amount of the Term Loan B to be prepaid) to the Administrative Agent for the ratable benefit of the Term Loan B Lenders in accordance with the terms of the Credit Agreement.

4.6 Fees and Expenses. The Administrative Agent shall have received payment of all fees and expenses then owing to the Administrative Agent in connection with this Consent and Waiver, including, without limitation, the reasonable and documented fees and disbursements of counsel to the Administrative Agent incurred in connection with the negotiation, preparation, and execution of this Consent and Waiver and the review of the IPO Transactions.

4.7 No Material Adverse Effect. No Material Adverse Effect (as defined in the Credit Agreement) shall have occurred with respect to the Borrower and its Subsidiaries, taken as a whole, since December 31, 2021, and the Administrative Agent shall have received a certificate of an authorized officer of the Borrower to such effect.

Section 5 — Representations and Warranties of the Borrower

The Borrower hereby represents and warrants to the Administrative Agent and each Lender, as of the date hereof and as of the Consent Effective Date, as follows:

5.1 Organization and Good Standing. The Borrower is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware. The Borrower's principal executive offices are located at 4200 Ridgeline Parkway, Suite 1100, Austin, TX 78746, and its employer identification number is 83-4027615. The Borrower has the corporate power and authority to own or lease its properties and to conduct its business as currently conducted, and is duly qualified and in good standing in each jurisdiction in which the conduct of its business or the ownership or leasing of its properties makes such qualification necessary, except where the failure to be so qualified or in good standing could not reasonably be expected to have a Material Adverse Effect.

5.2 Authorization. The execution, delivery, and performance by the Borrower of this Consent and Waiver have been duly authorized by all necessary corporate action on the part of the Borrower. No consent, approval, authorization, or order of, or filing or registration with, any governmental authority or any other Person is required in connection with the execution, delivery, or performance of this Consent and Waiver by the Borrower, except for such consents, approvals, authorizations, orders, filings, or registrations as have been obtained or made (or as will be obtained or made prior to the Consent Effective Date) and are (or will be) in full force and effect.

5.3 No Conflict. The execution, delivery, and performance of this Consent and Waiver by the Borrower do not and will not (a) conflict with or violate any provision of the certificate of incorporation, bylaws, or other organizational documents of the Borrower, (b) conflict with, result in a breach of, or constitute a default (or an event which, with notice or lapse of time or both, would become a default) under any material agreement, indenture, mortgage, lease, or other instrument to which the Borrower is a party or by which the Borrower or any of its properties is bound, or (c) violate any applicable law, rule, regulation, judgment, order, or decree of any governmental authority having jurisdiction over the Borrower or any of its properties.

5.4 Representations and Warranties in the Credit Agreement. As of the date hereof, and after giving effect to the consent and waiver contained herein, the representations and warranties of the Borrower and each other Loan Party set forth in the Credit Agreement and each other Loan Document are true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or "Material Adverse Effect," true and correct in all respects), except to the extent that such representations and warranties expressly relate to a specific earlier date, in which case such representations and warranties are true and correct in all material respects (or, as applicable, in all respects) as of such earlier date.

5.5 No Default. No Default or Event of Default has occurred and is continuing under the Credit Agreement or any other Loan Document, other than any Default or Event of Default that is being waived by this Consent and Waiver. After giving effect to this Consent and Waiver, no Default or Event of Default exists under the Credit Agreement or any other Loan Document.

5.6 Financial Covenant Compliance. After giving pro forma effect to the IPO Transactions (including the issuance of shares of Common Stock in the IPO, the receipt of net proceeds therefrom, and the prepayment of approximately $200,000,000 of the outstanding principal amount of the Term Loan B), the Borrower and its Subsidiaries will be in compliance with all financial covenants set forth in the Credit Agreement, including, without limitation, the Total Leverage Ratio, the Senior Secured Leverage Ratio, and the Interest Coverage Ratio (each as defined in the Credit Agreement), in each case calculated on a pro forma basis as of the last day of the most recently ended fiscal quarter for which financial statements have been delivered pursuant to the Credit Agreement.

Section 6 — Covenants

The Borrower hereby covenants and agrees with the Administrative Agent and each Lender as follows:

6.1 Notice of IPO Pricing and Closing. The Borrower shall promptly (and in any event within one (1) Business Day) notify the Administrative Agent in writing of (a) the pricing of the IPO (including the actual offering price per share, the number of shares offered, and the aggregate offering size), (b) the IPO Closing Date, and (c) the actual net proceeds received by the Borrower from the primary offering and the actual net proceeds received by Pinnacle Vista from the secondary offering. Such notice shall be delivered to the Administrative Agent at the address set forth in Section 9.7 hereof and shall include a reasonably detailed description of the final terms of the IPO.

6.2 Term Loan B Prepayment. The Borrower shall apply $200,000,000 (or such other amount as is equal to the actual net proceeds designated for prepayment of the Term Loan B, as set forth in the final prospectus) against the outstanding principal amount of the Term Loan B within three (3) Business Days of the IPO Closing Date, together with (a) the prepayment premium of $2,000,000 (or 1.00% of the actual principal amount prepaid, if different from $200,000,000) and (b) all accrued and unpaid interest on the principal amount so prepaid through the date of such prepayment. Such prepayment shall be made in accordance with the voluntary prepayment provisions of Section [●] of the Credit Agreement and shall be applied to the remaining scheduled installments of the Term Loan B in inverse order of maturity (or in such other manner as may be required by the Credit Agreement).

6.3 Delivery of IPO Documents. The Borrower shall deliver to the Administrative Agent, within ten (10) Business Days of the IPO Closing Date, copies of the following documents in final form: (a) the final prospectus filed with the SEC in connection with the IPO, (b) the fully executed Underwriting Agreement, (c) evidence of the listing of the Common Stock on the NYSE, (d) the Amended and Restated Certificate of Incorporation as filed with the Secretary of State of the State of Delaware, (e) the Amended and Restated Bylaws as adopted by the Board of Directors of the Borrower, and (f) such other documents or certificates as the Administrative Agent may reasonably request in connection with the IPO Transactions.

6.4 Ongoing Reporting Obligations. The Borrower shall continue to comply with all reporting, financial statement delivery, and information obligations under the Credit Agreement (including, without limitation, the delivery of annual audited financial statements, quarterly unaudited financial statements, and compliance certificates), as modified to reflect its new status as a public reporting company under the Securities Exchange Act of 1934, as amended. Without limiting the foregoing, to the extent that the Borrower becomes subject to the periodic reporting requirements of the Securities Exchange Act of 1934, the delivery of the Borrower's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q (as and when filed with the SEC) shall satisfy the corresponding financial statement delivery obligations under the Credit Agreement, subject to any additional requirements specified therein.

Section 7 — Effect on Credit Agreement

7.1 Ratification and Confirmation. Except as expressly modified by this Consent and Waiver, the Credit Agreement and all other Loan Documents remain in full force and effect and are hereby ratified and confirmed in all respects. Each reference in the Credit Agreement to "this Agreement," "herein," "hereof," "hereby," "hereunder," or words of similar import, and each reference in any other Loan Document to the Credit Agreement, shall be deemed to be a reference to the Credit Agreement as supplemented by this Consent and Waiver. Nothing contained in this Consent and Waiver shall be construed to imply any willingness on the part of the Administrative Agent or any Lender to agree to any other modification, consent, or waiver of any of the terms and conditions of the Credit Agreement or any other Loan Document.

7.2 No Novation. This Consent and Waiver shall not constitute a novation of the Credit Agreement or any other Loan Document, and shall not extinguish, terminate, or impair any obligation, liability, or lien arising under the Credit Agreement or any other Loan Document. The Credit Agreement, as supplemented by this Consent and Waiver, and each other Loan Document shall continue in full force and effect in accordance with their respective terms.

7.3 References. On and after the Consent Effective Date, each reference in the Credit Agreement to "this Agreement," "herein," "hereof," or words of similar import shall mean and be a reference to the Credit Agreement as supplemented by this Consent and Waiver, and this Consent and Waiver shall be read together with the Credit Agreement and the other Loan Documents and shall form a part thereof.

7.4 Loan Document. This Consent and Waiver constitutes a "Loan Document" as defined in, and for all purposes under, the Credit Agreement and the other Loan Documents. Accordingly, all provisions of the Credit Agreement applicable to Loan Documents generally (including, without limitation, provisions relating to the rights and remedies of the Administrative Agent and the Lenders, indemnification, and expense reimbursement) shall apply to this Consent and Waiver.

Section 8 — Reaffirmation by Guarantors

Each of CBR Holdings LLC and Calloway-Briggs Operating Company LLC, and each other Guarantor party hereto (each, a "Reaffirming Guarantor"), hereby:

(a) acknowledges receipt of a copy of this Consent and Waiver and acknowledges and consents to the terms and provisions hereof;

(b) confirms and agrees that, notwithstanding the effectiveness of this Consent and Waiver, the Guarantee, the Security Agreement, and all other Loan Documents to which such Reaffirming Guarantor is a party remain in full force and effect and are hereby ratified and confirmed in all respects, and no term, condition, or provision of any such Loan Document is modified, impaired, or affected by this Consent and Waiver (except to the extent expressly set forth herein);

(c) confirms and agrees that its obligations under the Guarantee and each other Loan Document to which it is a party extend to and cover the obligations of the Borrower under the Credit Agreement as supplemented by this Consent and Waiver; and

(d) acknowledges and agrees that the security interests and liens granted by such Reaffirming Guarantor in favor of the Administrative Agent for the benefit of the Secured Parties under the Security Agreement and the other Loan Documents continue in full force and effect and secure the obligations of the Borrower and the Guarantors under the Credit Agreement as supplemented by this Consent and Waiver.

Each Reaffirming Guarantor represents and warrants that the execution, delivery, and performance of this Consent and Waiver by such Reaffirming Guarantor have been duly authorized by all necessary limited liability company, corporate, or other organizational action, as applicable, and do not conflict with or violate any provision of its organizational documents, any material agreement to which it is a party, or any applicable law.

Section 9 — Miscellaneous

9.1 Governing Law. THIS CONSENT AND WAIVER AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF NEW YORK OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK. This governing law provision is consistent with Section [●] of the Credit Agreement, and the parties hereto submit to the exclusive jurisdiction of the courts specified in Section [●] of the Credit Agreement with respect to any dispute arising out of or relating to this Consent and Waiver.

9.2 Counterparts. This Consent and Waiver may be executed in one or more counterparts, each of which shall be deemed an original, and all of which, taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Consent and Waiver by facsimile transmission, by electronic mail in portable document format (".pdf"), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document shall be effective as delivery of a manually executed counterpart hereof.

9.3 Headings. The section headings and captions contained in this Consent and Waiver are included for convenience of reference only, shall not constitute a part of this Consent and Waiver for any purpose, and shall not affect the meaning, interpretation, or construction of any provision hereof.

9.4 Entire Agreement. This Consent and Waiver, together with the Credit Agreement and the other Loan Documents, constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, negotiations, representations, warranties, commitments, offers, and understandings, whether written or oral, with respect to such subject matter.

9.5 Amendments and Modifications. This Consent and Waiver may not be amended, modified, supplemented, restated, or otherwise changed except by a writing duly executed by the Borrower and the Administrative Agent (acting at the direction of the Required Lenders), and any such amendment, modification, supplement, restatement, or other change shall be subject to the provisions of Section [●] of the Credit Agreement governing amendments and modifications of Loan Documents.

9.6 Severability. If any provision of this Consent and Waiver is held to be invalid, illegal, or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision of this Consent and Waiver or the validity, legality, or enforceability of such provision in any other jurisdiction. In the event that any such provision is determined to be invalid, illegal, or unenforceable, the parties hereto shall negotiate in good faith to modify this Consent and Waiver so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner.

9.7 Notices. All notices, requests, demands, consents, approvals, and other communications under this Consent and Waiver shall be given in accordance with the notice provisions of Section [●] of the Credit Agreement, except that notices to the parties hereto shall be sent to the following addresses (or to such other address as any party may from time to time designate in writing in accordance with such Section):

If to the Administrative Agent:

Veltrano National Bank 1401 McKinney Street Houston, TX 77010

Attention: Thomas Raines, Managing Director, Energy Lending

If to the Borrower:

Calloway-Briggs Renewables Inc. 4200 Ridgeline Parkway, Suite 1100 Austin, TX 78746

Attention: Priya Anand, SVP, Finance & Treasurer

with a copy (which shall not constitute notice) to:

Calloway-Briggs Renewables Inc. 4200 Ridgeline Parkway, Suite 1100 Austin, TX 78746

Attention: Sandra Haverford, General Counsel & Corporate Secretary

If to Borrower's Counsel:

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

Attention: Jennifer Kwon

[Remainder of This Page Intentionally Left Blank; Signature Pages Follow]

IN WITNESS WHEREOF, the parties hereto have caused this Consent and Waiver to be duly executed and delivered as of the date first written above.

ADMINISTRATIVE AGENT

VELTRANO NATIONAL BANK, as Administrative Agent

By: ________

Name: Thomas Raines

Title: Managing Director, Energy Lending

BORROWER

CALLOWAY-BRIGGS RENEWABLES INC.

The following table sets forth a summary of the material terms and details of the proposed initial public offering of the Common Stock of Calloway-Briggs Renewables Inc., as described in the Recitals to this Consent and Waiver:

Note: All share numbers, dollar amounts, and percentages set forth above are estimates based on an assumed offering price of $22.00 per share and are subject to change based on final pricing and other factors. Actual amounts may vary.

[End of Schedule A]

Calderwood & Harkness LLP — C&H Matter No. 1015-00001 Prepared by: Brendan Walsh Reviewed by: Jennifer Kwon [DRAFT — Subject to review by all parties; not for execution]

Item	Detail
Issuer	Calloway-Briggs Renewables Inc.
Securities	Common Stock, par value $0.01 per share
Proposed Exchange	New York Stock Exchange
Proposed Ticker Symbol	CBRI
Aggregate Offering Size (incl. overallotment)	$600,000,000
Base Offering Size	$521,700,000 (approx. 23,713,636 shares at $22.00/share)
Overallotment Option (15%)	$78,300,000 (approx. 3,559,091 shares at $22.00/share)
Primary Offering (Company)	$371,700,000 (approx. 16,895,455 shares)
Secondary Offering (Pinnacle Vista)	$150,000,000 (approx. 6,818,182 shares)
Pre-IPO Shares Outstanding	100,000,000
Post-IPO Shares Outstanding (base offering)	123,713,636
Post-IPO Shares Outstanding (full overallotment exercise)	127,272,727
Underwriters	Hargrove Keating & Co. (lead-left bookrunner), Linden Pratt Securities LLC, Graymont Brothers Inc., Barfield Stuart & Co., Crane Whitley Capital LLC
Underwriting Gross Spread	5.50%
Intended Use of Net Proceeds	~$200,000,000 Term Loan B prepayment; ~$100,000,000 Cimarron Solar construction; ~$71,700,000 general corporate purposes
Term Loan B Prepayment Premium	1.00% × $200,000,000 = $2,000,000
Post-Prepayment Term Loan B Outstanding Balance	~$412,500,000
Selling Stockholder	Pinnacle Vista Capital Partners III, LP
Pre-IPO Pinnacle Vista Ownership	~62%
Post-IPO Pinnacle Vista Ownership (est., base offering)	~49%
Post-IPO Pinnacle Vista Ownership (est., full overallotment)	~47%
Lock-Up Period	180 days from IPO Closing Date
SEC CIK Number	0001948372
Equity Incentive Plan Shares Reserved (2022 Omnibus Plan)	12,727,273 shares

Equity Incentive Plan Shares Reserved (2022 ESPP)

[DRAFT — FOR DISCUSSION PURPOSES ONLY]
CONSENT AND WAIVER
Dated as of [●], 2022
among
CALLOWAY-BRIGGS RENEWABLES INC., as Borrower,
CBR HOLDINGS LLC,
CALLOWAY-BRIGGS OPERATING COMPANY LLC,
each of the other Guarantors party hereto,
and
VELTRANO NATIONAL BANK, as Administrative Agent
Reference is made to the Credit Agreement described herein
CONSENT AND WAIVER
This CONSENT AND WAIVER (this "Consent and Waiver"), dated as of [●], 2022, is entered into by and among CALLOWAY-BRIGGS RENEWABLES INC., a Delaware corporation (the "Borrower"), CBR HOLDINGS LLC, a Delaware limited liability company ("CBR Holdings"), CALLOWAY-BRIGGS OPERATING COMPANY LLC, a Texas limited liability company ("CBR Operating," and together with CBR Holdings, the "Subsidiary Guarantors"), each of the other Guarantors party hereto (together with the Subsidiary Guarantors, the "Guarantors"), and VELTRANO NATIONAL BANK, a national banking association, in its capacity as Administrative Agent (the "Administrative Agent") under that certain Credit Agreement, dated as of January [●], 2022 (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"), among the Borrower, CBR Holdings, CBR Operating, each of the Guarantors party thereto, the Lenders party thereto, and the Administrative Agent.
The Credit Agreement governs (a) the $400,000,000 Corporate Revolving Credit Facility (the "Revolving Credit Facility"), with a maturity date of January [●], 2027, and (b) the $650,000,000 Corporate Term Loan B (the "Term Loan B"), with a maturity date of January [●], 2029, of which approximately $612,500,000 is currently outstanding as of the date hereof. All notices and communications to the Administrative Agent in connection with this Consent and Waiver and the Credit Agreement shall be directed to: Veltrano National Bank, 1401 McKinney Street, Houston, TX 77010, Attention: Thomas Raines, Managing Director, Energy Lending.
RECITALS
WHEREAS:
A. The Borrower, CBR Holdings, CBR Operating, the Guarantors, the Lenders, and the Administrative Agent are parties to the Credit Agreement, dated as of January [●], 2022, pursuant to which the Lenders have made available to the Borrower the credit facilities described therein. Capitalized terms used but not otherwise defined in this Consent and Waiver shall have the respective meanings ascribed to such terms in the Credit Agreement.
B. The Borrower has informed the Administrative Agent that it proposes to consummate an initial public offering (the "IPO") of shares of its common stock, par value $0.01 per share (the "Common Stock"), on the New York Stock Exchange (the "NYSE") under the proposed ticker symbol "CBRI." The anticipated aggregate offering size of the IPO is approximately $600,000,000 (inclusive of a 15% overallotment option granted to the underwriters). The IPO will consist of: (i) a primary offering by the Borrower of approximately $371,700,000 of Common Stock (approximately 16,895,455 shares at an assumed offering price of $22.00 per share) and (ii) a secondary offering by Pinnacle Vista Capital Partners III, LP ("Pinnacle Vista"), the Borrower's majority stockholder, of approximately $150,000,000 of Common Stock (approximately 6,818,182 shares at an assumed offering price of $22.00 per share). The Borrower intends to use approximately $200,000,000 of the net proceeds from the primary offering to prepay a portion of the outstanding Term Loan B, with the remainder of such net proceeds to be applied to fund the construction of the Cimarron Solar project (approximately $100,000,000) and for general corporate purposes (approximately $71,700,000). A summary of the material terms and details of the IPO is set forth on Schedule A attached hereto.
C. Section [●] of the Credit Agreement contains a definition of "Change of Control" that may be triggered by the IPO and the resulting change in ownership percentages of the Borrower, including the dilution of Pinnacle Vista's ownership percentage from approximately 62% to approximately 49% on a base offering basis (or approximately 47% assuming full exercise of the overallotment option). Section [●] of the Credit Agreement requires the consent of the Administrative Agent (acting at the direction of the Required Lenders) for any Change of Control event and provides that the occurrence of a Change of Control without such consent constitutes an Event of Default under the Credit Agreement. Section [●] of the Credit Agreement contains certain negative covenants regarding the issuance of equity interests by the Borrower, which may restrict the Borrower's ability to consummate the issuance of shares of Common Stock in the IPO and under related equity incentive plans without the prior consent of the Administrative Agent and the Required Lenders. The Borrower has requested that (i) the Administrative Agent and the Required Lenders consent to the IPO and the related transactions and (ii) waive any Default or Event of Default that would otherwise arise under the Credit Agreement solely as a result of the consummation of the IPO.
D. In connection with the foregoing, the Borrower has submitted a formal consent request letter dated [●], 2022 (the "Consent Request Letter"), prepared by Calderwood & Harkness LLP, counsel to the Borrower (with offices at 599 Lexington Avenue, New York, NY 10022), addressed to Thomas Raines at Veltrano National Bank, requesting the consent and waiver contemplated hereby. The Administrative Agent, acting at the direction of the Required Lenders, has agreed to grant such consent and waiver, subject to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
Section 1 — Definitions
As used in this Consent and Waiver, the following terms shall have the following meanings:
"Consent and Waiver" means this Consent and Waiver, dated as of [●], 2022, among the Borrower, the Guarantors, and the Administrative Agent, as the same may be amended, restated, supplemented, or otherwise modified from time to time in accordance with the terms hereof.
"Consent Effective Date" means the first date on which each of the conditions set forth in Section 4 hereof has been satisfied or waived by the Administrative Agent in its sole discretion.
"Credit Agreement" has the meaning assigned to such term in the preamble hereto.
"IPO" means the initial public offering of the Borrower's Common Stock as described in Recital B hereto and as more fully set forth on Schedule A attached hereto.
"IPO Closing Date" means the date on which the closing of the IPO occurs, including the delivery of shares of Common Stock to the purchasers thereof against payment of the purchase price therefor.
"IPO Transactions" means, collectively, (a) the filing and effectiveness of the Registration Statement on Form S-1 (and any amendments or supplements thereto) with the United States Securities and Exchange Commission (the "SEC"), (b) the offering, issuance, and sale of shares of Common Stock in the IPO (including any shares sold pursuant to the exercise of the overallotment option by the underwriters), (c) the sale of secondary shares of Common Stock by Pinnacle Vista in the IPO, (d) the application of net proceeds from the IPO as described in the Recitals hereto (including the prepayment of approximately $200,000,000 of the outstanding principal amount of the Term Loan B), (e) the adoption of the Amended and Restated Certificate of Incorporation of the Borrower and the Amended and Restated Bylaws of the Borrower (each, as in effect on the IPO Closing Date), (f) the entry into or effectiveness of the Amended and Restated Stockholders' Agreement among the Borrower, Pinnacle Vista, and the other parties thereto, the Registration Rights Agreement among the Borrower, Pinnacle Vista, and the other parties thereto, the Underwriting Agreement among the Borrower, Pinnacle Vista, and the underwriters named therein, the Lock-Up Agreements entered into by the Borrower's directors, officers, and certain stockholders, the 2022 Omnibus Equity Incentive Plan, and the 2022 Employee Stock Purchase Plan, and (g) all related corporate actions, resolutions, filings with governmental authorities, and ancillary transactions reasonably necessary or advisable to consummate the foregoing.
All other capitalized terms used but not otherwise defined in this Consent and Waiver shall have the respective meanings ascribed to such terms in the Credit Agreement, and the rules of construction set forth in Section [●] of the Credit Agreement shall apply to this Consent and Waiver mutatis mutandis.
Section 2 — Consent
2.1 Consent to the IPO and Change of Control. The Administrative Agent, acting at the direction of the Required Lenders, hereby consents to the IPO Transactions and agrees that the consummation of the IPO Transactions shall not constitute a "Change of Control" (as defined in the Credit Agreement) or trigger any mandatory prepayment obligation, Default, Event of Default, or other adverse consequence arising from or related to a Change of Control under the Credit Agreement or any other Loan Document. Without limiting the generality of the foregoing, this consent applies specifically to: (i) the issuance of new shares of Common Stock by the Borrower in the primary offering (up to 19,429,773 shares on a base offering basis, or up to 22,989,318 shares assuming exercise of the overallotment option with respect to primary shares, and in any event not exceeding 27,272,727 shares in the aggregate assuming full exercise of the overallotment option applicable to both primary and secondary shares), (ii) the sale of secondary shares of Common Stock by Pinnacle Vista (up to 6,818,182 shares), (iii) the listing of the Common Stock on the NYSE under the proposed ticker symbol "CBRI," and (iv) any resulting dilution of existing stockholders' ownership percentages (including, without limitation, the reduction of Pinnacle Vista's ownership of the Borrower from approximately 62% of the outstanding Common Stock immediately prior to the IPO to approximately 49% of the outstanding Common Stock on a base offering basis, or approximately 47% of the outstanding Common Stock assuming full exercise of the overallotment option). The Administrative Agent and the Required Lenders acknowledge and agree that the reduction in Pinnacle Vista's ownership percentage described in this Section 2.1 shall not, in and of itself, give rise to any right of the Administrative Agent or any Lender to accelerate the obligations under the Credit Agreement, demand any mandatory prepayment (other than the voluntary prepayment described in Section 2.3 hereof), or exercise any other remedy under the Credit Agreement or any other Loan Document.
2.2 Consent to Issuance of Equity Interests. To the extent that the issuance of shares of Common Stock in the IPO, or the reservation and issuance of shares of Common Stock pursuant to the Borrower's 2022 Omnibus Equity Incentive Plan (under which up to 12,727,273 shares of Common Stock will be reserved for issuance) or the Borrower's 2022 Employee Stock Purchase Plan (under which up to 2,545,455 shares of Common Stock will be reserved for issuance), would otherwise require consent under Section [●] or any other negative covenant of the Credit Agreement restricting the issuance of Equity Interests (as defined in the Credit Agreement) by the Borrower or any of its Subsidiaries, such consent is hereby granted by the Administrative Agent, acting at the direction of the Required Lenders. This consent extends to all shares of Common Stock that may be issued from time to time pursuant to awards granted under the 2022 Omnibus Equity Incentive Plan or purchases made under the 2022 Employee Stock Purchase Plan, in each case in accordance with the terms of such plans as in effect on the IPO Closing Date (or as subsequently amended in a manner not materially adverse to the Lenders).
2.3 Consent to Use of Proceeds and Prepayment. The Administrative Agent, acting at the direction of the Required Lenders, hereby consents to the application of approximately $200,000,000 of the net proceeds from the IPO to prepay a portion of the outstanding principal amount of the Term Loan B in accordance with the voluntary prepayment provisions of Section [●] of the Credit Agreement. The Administrative Agent acknowledges that such prepayment shall be subject to the applicable prepayment premium of 1.00% of the principal amount prepaid (i.e., $2,000,000), as set forth in Section [●] of the Credit Agreement, and that such prepayment premium shall be paid by the Borrower concurrently with or promptly following the application of such net proceeds. The parties hereby confirm that, after giving effect to such prepayment, the outstanding principal balance of the Term Loan B will be reduced from approximately $612,500,000 to approximately $412,500,000. The Administrative Agent further acknowledges and consents to the application of the remaining net proceeds from the IPO for the purposes described in the Recitals, including the funding of construction costs associated with the Cimarron Solar project (approximately $100,000,000) and for general corporate purposes (approximately $71,700,000). Nothing in this Section 2.3 shall be construed to modify or waive any obligation of the Borrower to comply with the mandatory prepayment provisions of the Credit Agreement with respect to any future event or transaction other than the IPO Transactions.
2.4 Consent to Charter and Governance Changes. The Administrative Agent, acting at the direction of the Required Lenders, hereby consents to the adoption of the Amended and Restated Certificate of Incorporation and the Amended and Restated Bylaws of the Borrower in connection with the IPO, to the extent such amendments would otherwise require consent under Section [●] or any other provision of the Credit Agreement. This consent is granted on the understanding that the Borrower has provided, or will provide prior to the Consent Effective Date, copies of the Amended and Restated Certificate of Incorporation and the Amended and Restated Bylaws in substantially final form to the Administrative Agent for its review. The Administrative Agent reserves the right to withdraw this consent if the final forms of such documents differ in any material respect from the drafts provided to the Administrative Agent prior to the date hereof.
Section 3 — Waiver
3.1 Waiver of Default. The Administrative Agent, acting at the direction of the Required Lenders, hereby waives any Default or Event of Default under the Credit Agreement that would arise solely as a result of the consummation of the IPO Transactions (including, without limitation, any Default or Event of Default arising under (a) the Change of Control provision set forth in Section [●] of the Credit Agreement, (b) the negative covenant restricting the issuance of Equity Interests set forth in Section [●] of the Credit Agreement, (c) any reporting, notice, or information delivery requirement under the Credit Agreement, in each case solely to the extent such Default or Event of Default is triggered by the IPO Transactions), provided that such waiver shall be effective only upon the occurrence of the Consent Effective Date and only with respect to the specific Defaults or Events of Default described herein. For the avoidance of doubt, this waiver extends to any Default or Event of Default that would arise under the Credit Agreement as a result of the reduction in Pinnacle Vista's ownership of the outstanding Common Stock of the Borrower to below any applicable threshold set forth in the definition of "Change of Control" in the Credit Agreement, solely as a consequence of the issuance and sale of shares of Common Stock in the IPO.
3.2 Limited Waiver. The waiver set forth in Section 3.1 hereof is limited solely to the IPO Transactions described herein and shall not constitute a waiver of (a) any other Default or Event of Default, whether currently existing or arising in the future, (b) any right or remedy of the Administrative Agent or any Lender under the Credit Agreement or any other Loan Document (other than to the limited extent expressly waived herein), or (c) any provision of the Credit Agreement or any other Loan Document (other than to the limited extent expressly waived herein). This waiver shall not be deemed to establish a custom or course of dealing between the parties, and shall not obligate the Administrative Agent or any Lender to grant any future consent, waiver, amendment, or modification with respect to any provision of the Credit Agreement or any other Loan Document, whether or not the circumstances are similar to those giving rise to this waiver. The Administrative Agent and the Required Lenders expressly reserve all of their rights and remedies under the Credit Agreement and the other Loan Documents, at law, and in equity, except to the limited extent expressly waived herein.
Section 4 — Conditions to Effectiveness
The consent and waiver set forth in Sections 2 and 3 hereof shall become effective on the Consent Effective Date, which shall be the first date on which each of the following conditions has been satisfied (or waived by the Administrative Agent in writing):
4.1 Execution and Delivery. The Administrative Agent shall have received a counterpart of this Consent and Waiver duly executed and delivered by each of the Borrower, CBR Holdings LLC, Calloway-Briggs Operating Company LLC, and each other Guarantor party to the Credit Agreement (including, without limitation, each of the project-level subsidiary Guarantors identified on the signature pages hereof).
4.2 Registration Statement. The Administrative Agent shall have received evidence reasonably satisfactory to it (which may include a copy of the EDGAR filing confirmation) of the filing of the Registration Statement on Form S-1 with the SEC by the Borrower (SEC CIK No. 0001948372), together with a copy of such Registration Statement as filed.
4.3 Underwriting Agreement. The Administrative Agent shall have received a copy of the Underwriting Agreement among the Borrower, Pinnacle Vista, and the underwriters named therein, in substantially final form, together with a certificate of an authorized officer of the Borrower confirming that such Underwriting Agreement does not contain any terms or provisions that are materially adverse to the interests of the Lenders under the Credit Agreement.
4.4 Officer's Certificate. The Administrative Agent shall have received a certificate of an authorized officer of the Borrower (the "Officer's Certificate"), in form and substance reasonably satisfactory to the Administrative Agent, certifying that: (a) each of the representations and warranties of the Borrower and each other Loan Party set forth in the Credit Agreement and the other Loan Documents is true and correct in all material respects as of the Consent Effective Date (or, in the case of any representation or warranty that is qualified by materiality or "Material Adverse Effect," true and correct in all respects), except to the extent that such representations and warranties expressly relate to a specific earlier date, in which case such representations and warranties shall be true and correct in all material respects (or, as applicable, in all respects) as of such earlier date; and (b) no Default or Event of Default has occurred and is continuing as of the Consent Effective Date (other than those Defaults or Events of Default being waived by this Consent and Waiver).
4.5 Prepayment Premium. The Administrative Agent shall have received evidence reasonably satisfactory to it that the Borrower has paid (or will pay simultaneously with the IPO Closing Date) the applicable prepayment premium of $2,000,000 (representing 1.00% of the $200,000,000 principal amount of the Term Loan B to be prepaid) to the Administrative Agent for the ratable benefit of the Term Loan B Lenders in accordance with the terms of the Credit Agreement.
4.6 Fees and Expenses. The Administrative Agent shall have received payment of all fees and expenses then owing to the Administrative Agent in connection with this Consent and Waiver, including, without limitation, the reasonable and documented fees and disbursements of counsel to the Administrative Agent incurred in connection with the negotiation, preparation, and execution of this Consent and Waiver and the review of the IPO Transactions.
4.7 No Material Adverse Effect. No Material Adverse Effect (as defined in the Credit Agreement) shall have occurred with respect to the Borrower and its Subsidiaries, taken as a whole, since December 31, 2021, and the Administrative Agent shall have received a certificate of an authorized officer of the Borrower to such effect.
Section 5 — Representations and Warranties of the Borrower
The Borrower hereby represents and warrants to the Administrative Agent and each Lender, as of the date hereof and as of the Consent Effective Date, as follows:
5.1 Organization and Good Standing. The Borrower is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware. The Borrower's principal executive offices are located at 4200 Ridgeline Parkway, Suite 1100, Austin, TX 78746, and its employer identification number is 83-4027615. The Borrower has the corporate power and authority to own or lease its properties and to conduct its business as currently conducted, and is duly qualified and in good standing in each jurisdiction in which the conduct of its business or the ownership or leasing of its properties makes such qualification necessary, except where the failure to be so qualified or in good standing could not reasonably be expected to have a Material Adverse Effect.
5.2 Authorization. The execution, delivery, and performance by the Borrower of this Consent and Waiver have been duly authorized by all necessary corporate action on the part of the Borrower. No consent, approval, authorization, or order of, or filing or registration with, any governmental authority or any other Person is required in connection with the execution, delivery, or performance of this Consent and Waiver by the Borrower, except for such consents, approvals, authorizations, orders, filings, or registrations as have been obtained or made (or as will be obtained or made prior to the Consent Effective Date) and are (or will be) in full force and effect.
5.3 No Conflict. The execution, delivery, and performance of this Consent and Waiver by the Borrower do not and will not (a) conflict with or violate any provision of the certificate of incorporation, bylaws, or other organizational documents of the Borrower, (b) conflict with, result in a breach of, or constitute a default (or an event which, with notice or lapse of time or both, would become a default) under any material agreement, indenture, mortgage, lease, or other instrument to which the Borrower is a party or by which the Borrower or any of its properties is bound, or (c) violate any applicable law, rule, regulation, judgment, order, or decree of any governmental authority having jurisdiction over the Borrower or any of its properties.
5.4 Representations and Warranties in the Credit Agreement. As of the date hereof, and after giving effect to the consent and waiver contained herein, the representations and warranties of the Borrower and each other Loan Party set forth in the Credit Agreement and each other Loan Document are true and correct in all material respects (or, in the case of any representation or warranty qualified by materiality or "Material Adverse Effect," true and correct in all respects), except to the extent that such representations and warranties expressly relate to a specific earlier date, in which case such representations and warranties are true and correct in all material respects (or, as applicable, in all respects) as of such earlier date.
5.5 No Default. No Default or Event of Default has occurred and is continuing under the Credit Agreement or any other Loan Document, other than any Default or Event of Default that is being waived by this Consent and Waiver. After giving effect to this Consent and Waiver, no Default or Event of Default exists under the Credit Agreement or any other Loan Document.
5.6 Financial Covenant Compliance. After giving pro forma effect to the IPO Transactions (including the issuance of shares of Common Stock in the IPO, the receipt of net proceeds therefrom, and the prepayment of approximately $200,000,000 of the outstanding principal amount of the Term Loan B), the Borrower and its Subsidiaries will be in compliance with all financial covenants set forth in the Credit Agreement, including, without limitation, the Total Leverage Ratio, the Senior Secured Leverage Ratio, and the Interest Coverage Ratio (each as defined in the Credit Agreement), in each case calculated on a pro forma basis as of the last day of the most recently ended fiscal quarter for which financial statements have been delivered pursuant to the Credit Agreement.
Section 6 — Covenants
The Borrower hereby covenants and agrees with the Administrative Agent and each Lender as follows:
6.1 Notice of IPO Pricing and Closing. The Borrower shall promptly (and in any event within one (1) Business Day) notify the Administrative Agent in writing of (a) the pricing of the IPO (including the actual offering price per share, the number of shares offered, and the aggregate offering size), (b) the IPO Closing Date, and (c) the actual net proceeds received by the Borrower from the primary offering and the actual net proceeds received by Pinnacle Vista from the secondary offering. Such notice shall be delivered to the Administrative Agent at the address set forth in Section 9.7 hereof and shall include a reasonably detailed description of the final terms of the IPO.
6.2 Term Loan B Prepayment. The Borrower shall apply $200,000,000 (or such other amount as is equal to the actual net proceeds designated for prepayment of the Term Loan B, as set forth in the final prospectus) against the outstanding principal amount of the Term Loan B within three (3) Business Days of the IPO Closing Date, together with (a) the prepayment premium of $2,000,000 (or 1.00% of the actual principal amount prepaid, if different from $200,000,000) and (b) all accrued and unpaid interest on the principal amount so prepaid through the date of such prepayment. Such prepayment shall be made in accordance with the voluntary prepayment provisions of Section [●] of the Credit Agreement and shall be applied to the remaining scheduled installments of the Term Loan B in inverse order of maturity (or in such other manner as may be required by the Credit Agreement).
6.3 Delivery of IPO Documents. The Borrower shall deliver to the Administrative Agent, within ten (10) Business Days of the IPO Closing Date, copies of the following documents in final form: (a) the final prospectus filed with the SEC in connection with the IPO, (b) the fully executed Underwriting Agreement, (c) evidence of the listing of the Common Stock on the NYSE, (d) the Amended and Restated Certificate of Incorporation as filed with the Secretary of State of the State of Delaware, (e) the Amended and Restated Bylaws as adopted by the Board of Directors of the Borrower, and (f) such other documents or certificates as the Administrative Agent may reasonably request in connection with the IPO Transactions.
6.4 Ongoing Reporting Obligations. The Borrower shall continue to comply with all reporting, financial statement delivery, and information obligations under the Credit Agreement (including, without limitation, the delivery of annual audited financial statements, quarterly unaudited financial statements, and compliance certificates), as modified to reflect its new status as a public reporting company under the Securities Exchange Act of 1934, as amended. Without limiting the foregoing, to the extent that the Borrower becomes subject to the periodic reporting requirements of the Securities Exchange Act of 1934, the delivery of the Borrower's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q (as and when filed with the SEC) shall satisfy the corresponding financial statement delivery obligations under the Credit Agreement, subject to any additional requirements specified therein.
Section 7 — Effect on Credit Agreement
7.1 Ratification and Confirmation. Except as expressly modified by this Consent and Waiver, the Credit Agreement and all other Loan Documents remain in full force and effect and are hereby ratified and confirmed in all respects. Each reference in the Credit Agreement to "this Agreement," "herein," "hereof," "hereby," "hereunder," or words of similar import, and each reference in any other Loan Document to the Credit Agreement, shall be deemed to be a reference to the Credit Agreement as supplemented by this Consent and Waiver. Nothing contained in this Consent and Waiver shall be construed to imply any willingness on the part of the Administrative Agent or any Lender to agree to any other modification, consent, or waiver of any of the terms and conditions of the Credit Agreement or any other Loan Document.
7.2 No Novation. This Consent and Waiver shall not constitute a novation of the Credit Agreement or any other Loan Document, and shall not extinguish, terminate, or impair any obligation, liability, or lien arising under the Credit Agreement or any other Loan Document. The Credit Agreement, as supplemented by this Consent and Waiver, and each other Loan Document shall continue in full force and effect in accordance with their respective terms.
7.3 References. On and after the Consent Effective Date, each reference in the Credit Agreement to "this Agreement," "herein," "hereof," or words of similar import shall mean and be a reference to the Credit Agreement as supplemented by this Consent and Waiver, and this Consent and Waiver shall be read together with the Credit Agreement and the other Loan Documents and shall form a part thereof.
7.4 Loan Document. This Consent and Waiver constitutes a "Loan Document" as defined in, and for all purposes under, the Credit Agreement and the other Loan Documents. Accordingly, all provisions of the Credit Agreement applicable to Loan Documents generally (including, without limitation, provisions relating to the rights and remedies of the Administrative Agent and the Lenders, indemnification, and expense reimbursement) shall apply to this Consent and Waiver.
Section 8 — Reaffirmation by Guarantors
Each of CBR Holdings LLC and Calloway-Briggs Operating Company LLC, and each other Guarantor party hereto (each, a "Reaffirming Guarantor"), hereby:
(a) acknowledges receipt of a copy of this Consent and Waiver and acknowledges and consents to the terms and provisions hereof;
(b) confirms and agrees that, notwithstanding the effectiveness of this Consent and Waiver, the Guarantee, the Security Agreement, and all other Loan Documents to which such Reaffirming Guarantor is a party remain in full force and effect and are hereby ratified and confirmed in all respects, and no term, condition, or provision of any such Loan Document is modified, impaired, or affected by this Consent and Waiver (except to the extent expressly set forth herein);
(c) confirms and agrees that its obligations under the Guarantee and each other Loan Document to which it is a party extend to and cover the obligations of the Borrower under the Credit Agreement as supplemented by this Consent and Waiver; and
(d) acknowledges and agrees that the security interests and liens granted by such Reaffirming Guarantor in favor of the Administrative Agent for the benefit of the Secured Parties under the Security Agreement and the other Loan Documents continue in full force and effect and secure the obligations of the Borrower and the Guarantors under the Credit Agreement as supplemented by this Consent and Waiver.
Each Reaffirming Guarantor represents and warrants that the execution, delivery, and performance of this Consent and Waiver by such Reaffirming Guarantor have been duly authorized by all necessary limited liability company, corporate, or other organizational action, as applicable, and do not conflict with or violate any provision of its organizational documents, any material agreement to which it is a party, or any applicable law.
Section 9 — Miscellaneous
9.1 Governing Law. THIS CONSENT AND WAIVER AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF NEW YORK OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK. This governing law provision is consistent with Section [●] of the Credit Agreement, and the parties hereto submit to the exclusive jurisdiction of the courts specified in Section [●] of the Credit Agreement with respect to any dispute arising out of or relating to this Consent and Waiver.
9.2 Counterparts. This Consent and Waiver may be executed in one or more counterparts, each of which shall be deemed an original, and all of which, taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Consent and Waiver by facsimile transmission, by electronic mail in portable document format (".pdf"), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document shall be effective as delivery of a manually executed counterpart hereof.
9.3 Headings. The section headings and captions contained in this Consent and Waiver are included for convenience of reference only, shall not constitute a part of this Consent and Waiver for any purpose, and shall not affect the meaning, interpretation, or construction of any provision hereof.
9.4 Entire Agreement. This Consent and Waiver, together with the Credit Agreement and the other Loan Documents, constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, negotiations, representations, warranties, commitments, offers, and understandings, whether written or oral, with respect to such subject matter.
9.5 Amendments and Modifications. This Consent and Waiver may not be amended, modified, supplemented, restated, or otherwise changed except by a writing duly executed by the Borrower and the Administrative Agent (acting at the direction of the Required Lenders), and any such amendment, modification, supplement, restatement, or other change shall be subject to the provisions of Section [●] of the Credit Agreement governing amendments and modifications of Loan Documents.
9.6 Severability. If any provision of this Consent and Waiver is held to be invalid, illegal, or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision of this Consent and Waiver or the validity, legality, or enforceability of such provision in any other jurisdiction. In the event that any such provision is determined to be invalid, illegal, or unenforceable, the parties hereto shall negotiate in good faith to modify this Consent and Waiver so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner.
9.7 Notices. All notices, requests, demands, consents, approvals, and other communications under this Consent and Waiver shall be given in accordance with the notice provisions of Section [●] of the Credit Agreement, except that notices to the parties hereto shall be sent to the following addresses (or to such other address as any party may from time to time designate in writing in accordance with such Section):
If to the Administrative Agent:
Veltrano National Bank 1401 McKinney Street Houston, TX 77010
Attention: Thomas Raines, Managing Director, Energy Lending
If to the Borrower:
Calloway-Briggs Renewables Inc. 4200 Ridgeline Parkway, Suite 1100 Austin, TX 78746
Attention: Priya Anand, SVP, Finance & Treasurer
with a copy (which shall not constitute notice) to:
Calloway-Briggs Renewables Inc. 4200 Ridgeline Parkway, Suite 1100 Austin, TX 78746
Attention: Sandra Haverford, General Counsel & Corporate Secretary
If to Borrower's Counsel:
Calderwood & Harkness LLP 599 Lexington Avenue New York, NY 10022
Attention: Jennifer Kwon
[Remainder of This Page Intentionally Left Blank; Signature Pages Follow]
IN WITNESS WHEREOF, the parties hereto have caused this Consent and Waiver to be duly executed and delivered as of the date first written above.
ADMINISTRATIVE AGENT
VELTRANO NATIONAL BANK, as Administrative Agent
By: ________
Name: Thomas Raines
Title: Managing Director, Energy Lending
BORROWER
CALLOWAY-BRIGGS RENEWABLES INC.
By: ________
Name: Priya Anand
Title: SVP, Finance & Treasurer
GUARANTORS (REAFFIRMATION)
CBR HOLDINGS LLC
By: Calloway-Briggs Renewables Inc., its sole member
By: ________
Name: [●]
Title: [●]
CALLOWAY-BRIGGS OPERATING COMPANY LLC
By: CBR Holdings LLC, its sole member
By: Calloway-Briggs Renewables Inc., its sole member of CBR Holdings LLC
By: ________
Name: [●]
Title: [●]
SOLARIS WEST SOLAR LLC
By: CBR Holdings LLC, its sole member
By: Calloway-Briggs Renewables Inc., its sole member of CBR Holdings LLC
By: ________
Name: [●]
Title: [●]
RED MESA WIND ENERGY LLC
By: CBR Holdings LLC, its sole member
By: Calloway-Briggs Renewables Inc., its sole member of CBR Holdings LLC
By: ________
Name: [●]
Title: [●]
PAINTED ROCK SOLAR LLC
By: CBR Holdings LLC, its sole member
By: Calloway-Briggs Renewables Inc., its sole member of CBR Holdings LLC
By: ________
Name: [●]
Title: [●]
PRONGHORN WIND LLC
By: CBR Holdings LLC, its sole member
By: Calloway-Briggs Renewables Inc., its sole member of CBR Holdings LLC
By: ________
Name: [●]
Title: [●]
BRAZOS ENERGY STORAGE LLC
By: CBR Holdings LLC, its sole member
By: Calloway-Briggs Renewables Inc., its sole member of CBR Holdings LLC
By: ________
Name: [●]
Title: [●]
MESQUITE WIND HOLDINGS LLC
By: CBR Holdings LLC, its sole member
By: Calloway-Briggs Renewables Inc., its sole member of CBR Holdings LLC
By: ________
Name: [●]
Title: [●]
CIMARRON SOLAR DEVELOPMENT LLC
By: CBR Holdings LLC, its sole member
By: Calloway-Briggs Renewables Inc., its sole member of CBR Holdings LLC
By: ________
Name: [●]
Title: [●]
CBR DEVELOPMENT CO. LLC
By: CBR Holdings LLC, its sole member
By: Calloway-Briggs Renewables Inc., its sole member of CBR Holdings LLC
By: ________
Name: [●]
Title: [●]
[Additional Guarantor signature blocks to be inserted as needed upon confirmation of the complete list of Guarantors under the Credit Agreement.]
SCHEDULE A
Description of IPO Transactions
The following table sets forth a summary of the material terms and details of the proposed initial public offering of the Common Stock of Calloway-Briggs Renewables Inc., as described in the Recitals to this Consent and Waiver:
Note: All share numbers, dollar amounts, and percentages set forth above are estimates based on an assumed offering price of $22.00 per share and are subject to change based on final pricing and other factors. Actual amounts may vary.
[End of Schedule A]
Calderwood & Harkness LLP — C&H Matter No. 1015-00001 Prepared by: Brendan Walsh Reviewed by: Jennifer Kwon [DRAFT — Subject to review by all parties; not for execution]
Item | Detail
Issuer | Calloway-Briggs Renewables Inc.
Securities | Common Stock, par value $0.01 per share
Proposed Exchange | New York Stock Exchange
Proposed Ticker Symbol | CBRI
Aggregate Offering Size (incl. overallotment) | $600,000,000
Base Offering Size | $521,700,000 (approx. 23,713,636 shares at $22.00/share)
Overallotment Option (15%) | $78,300,000 (approx. 3,559,091 shares at $22.00/share)
Primary Offering (Company) | $371,700,000 (approx. 16,895,455 shares)
Secondary Offering (Pinnacle Vista) | $150,000,000 (approx. 6,818,182 shares)
Pre-IPO Shares Outstanding | 100,000,000
Post-IPO Shares Outstanding (base offering) | 123,713,636
Post-IPO Shares Outstanding (full overallotment exercise) | 127,272,727
Underwriters | Hargrove Keating & Co. (lead-left bookrunner), Linden Pratt Securities LLC, Graymont Brothers Inc., Barfield Stuart & Co., Crane Whitley Capital LLC
Underwriting Gross Spread | 5.50%
Intended Use of Net Proceeds | ~$200,000,000 Term Loan B prepayment; ~$100,000,000 Cimarron Solar construction; ~$71,700,000 general corporate purposes
Term Loan B Prepayment Premium | 1.00% × $200,000,000 = $2,000,000
Post-Prepayment Term Loan B Outstanding Balance | ~$412,500,000
Selling Stockholder | Pinnacle Vista Capital Partners III, LP
Pre-IPO Pinnacle Vista Ownership | ~62%
Post-IPO Pinnacle Vista Ownership (est., base offering) | ~49%
Post-IPO Pinnacle Vista Ownership (est., full overallotment) | ~47%
Lock-Up Period | 180 days from IPO Closing Date
SEC CIK Number | 0001948372
Equity Incentive Plan Shares Reserved (2022 Omnibus Plan) | 12,727,273 shares
Equity Incentive Plan Shares Reserved (2022 ESPP) | 2,545,455 shares

[DRAFT — FOR DISCUSSION PURPOSES ONLY]

CONSENT AND WAIVER

CBR HOLDINGS LLC,

CALLOWAY-BRIGGS OPERATING COMPANY LLC,

CONSENT AND WAIVER

RECITALS

WHEREAS:

ADMINISTRATIVE AGENT

BORROWER

CALLOWAY-BRIGGS RENEWABLES INC.

GUARANTORS (REAFFIRMATION)

CBR HOLDINGS LLC

CALLOWAY-BRIGGS OPERATING COMPANY LLC

SOLARIS WEST SOLAR LLC

RED MESA WIND ENERGY LLC

PAINTED ROCK SOLAR LLC

PRONGHORN WIND LLC

BRAZOS ENERGY STORAGE LLC

MESQUITE WIND HOLDINGS LLC

CIMARRON SOLAR DEVELOPMENT LLC

CBR DEVELOPMENT CO. LLC

SCHEDULE A

Record

Parties

Dates

Amounts