1015-00001 · Graymont Brothers Inc · Registration Statement

shares-eligible-for-future-sale.docx DOCUMENT Capital Markets

132 / 167 ← → ✕

CONFIDENTIAL TREATMENT REQUESTED — DRAFT — NOT FOR DISTRIBUTION

SHARES ELIGIBLE FOR FUTURE SALE

Future sales of substantial amounts of our common stock in the public market after this offering, or the perception that such sales could occur, could adversely affect the prevailing market price of our common stock and could impair our ability to raise capital through future equity offerings. We have analyzed the potential impact of future sales on the trading market for our common stock and have set forth below a description of the number of shares of our common stock that will be available for future sale upon completion of this offering, as well as the timing of such availability and applicable restrictions on resale.

Upon completion of this offering, we will have 123,713,636 shares of our common stock outstanding, assuming no exercise of the underwriters' overallotment option, or 127,272,727 shares of our common stock outstanding, assuming full exercise of the underwriters' overallotment option. In each case, the foregoing is based on 100,000,000 shares of our common stock outstanding immediately prior to the closing of this offering and assumes an initial public offering price of $22.00 per share, the midpoint of the estimated offering price range set forth on the cover page of this prospectus. The foregoing excludes (i) 12,727,273 shares of common stock reserved for future issuance under our 2022 Omnibus Equity Incentive Plan, (ii) 2,545,455 shares of common stock reserved for future issuance under our 2022 Employee Stock Purchase Plan, and (iii) any shares issuable upon exercise of the underwriters' overallotment option, except where the full exercise of such option is specifically assumed.

All of the 23,713,636 shares of common stock to be sold in this offering (or 27,272,727 shares if the underwriters exercise their overallotment option in full) will be freely tradable without restriction or further registration under the Securities Act of 1933, as amended (the "Securities Act"), unless such shares are purchased by "affiliates" of the Company, as that term is defined in Rule 144 under the Securities Act ("Rule 144"). Shares purchased by affiliates will be subject to the resale limitations of Rule 144 described below.

The remaining shares of common stock outstanding after this offering will be "restricted securities" as that term is defined in Rule 144. Restricted securities may be sold in the public market only if such sale is registered under the Securities Act or if the sale qualifies for an exemption from registration, including, without limitation, under Rules 144 and 701 under the Securities Act, each of which is summarized below. In addition, substantially all of these restricted securities will be subject to the 180-day lock-up agreements described below.

For a discussion of certain risks relating to future sales of our common stock and the potential impact on the market price for our shares, see "Risk Factors — Risks Relating to This Offering and Ownership of Our Common Stock."

Share Summary

The following table summarizes, on an approximate basis, the total number of shares of our common stock that will be outstanding or reserved for issuance upon completion of this offering and the timing of their eligibility for sale in the public market:

The restricted shares described above include the following categories of pre-IPO stockholders:

Pinnacle Vista Capital Partners III, LP. Pinnacle Vista Capital Partners III, LP ("Pinnacle Vista") holds approximately 62,000,000 shares of our common stock as of immediately prior to the closing of this offering, representing approximately 62% of our fully diluted common stock as of such date. In connection with this offering, Pinnacle Vista is selling 6,818,182 shares in the secondary offering component of this offering for aggregate gross proceeds of approximately $150,000,000 (at an assumed initial public offering price of $22.00 per share), and will retain approximately 55,181,818 shares following the completion of this offering. All shares retained by Pinnacle Vista following the offering are subject to the 180-day lock-up agreement described below and, upon expiration of the lock-up period, will be subject to Rule 144 limitations applicable to affiliates and the transfer restrictions and registration rights set forth in the Registration Rights Agreement described below.

Founders. Shares held by our co-founders, Garrett Calloway (our Chief Executive Officer and Chairman of the Board) and Elaine Briggs (our President and director), together with shares held by other members of management, represent approximately 24% of our pre-IPO shares, or approximately 24,000,000 shares in the aggregate. All such shares are subject to the 180-day lock-up agreements described below and, upon expiration of the lock-up period, will be subject to Rule 144 restrictions applicable to affiliates. In addition, shares held by Mr. Calloway and Ms. Briggs are subject to the Amended and Restated Stockholders' Agreement described below.

Earlier-Stage Investors and Employees. Shares held by our earlier-stage investors and employees represent approximately 14% of our pre-IPO shares, or approximately 14,000,000 shares in the aggregate. Shares held by holders of 1% or more of our pre-IPO shares are subject to lock-up agreements with Hargrove Keating & Co., as representative of the underwriters. Upon expiration of the applicable lock-up period, these shares will be eligible for resale under Rule 144, subject to the conditions described below. Shares held by pre-IPO stockholders who are not subject to lock-up agreements will be eligible for sale under Rule 144 beginning 90 days after the date of the final prospectus (subject to compliance with the conditions of Rule 144, including applicable holding-period requirements).

Lock-Up Agreements

Overview of Lock-Up Terms

Each of our directors, executive officers, Pinnacle Vista Capital Partners III, LP, and holders of 1% or more of our pre-IPO common stock (approximately 18 persons and entities in total) has entered into, or will enter into prior to the effectiveness of the registration statement of which this prospectus forms a part, a lock-up agreement with Hargrove Keating & Co., as representative of the underwriters of this offering. Pursuant to these lock-up agreements, each locked-up party has agreed that, for a period of 180 days following the date of the final prospectus relating to this offering (the "lock-up period"), such party will not, without the prior written consent of Hargrove Keating & Co.:

• offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right, or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any shares of common stock or any securities convertible into or exercisable or exchangeable for common stock (including, without limitation, common stock that may be deemed to be beneficially owned by such party in accordance with the rules and regulations of the Securities and Exchange Commission (the "SEC") and securities that may be issued upon exercise of a stock option or warrant), whether any such transaction is to be settled by delivery of common stock or such other securities, in cash, or otherwise; or

• enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the common stock, whether any such transaction is to be settled by delivery of common stock or such other securities, in cash, or otherwise.

The restrictions described in the preceding paragraph apply whether or not such transaction is to be settled by delivery of shares of common stock or other securities, in cash, or otherwise, and regardless of whether the shares or other securities are owned by the locked-up party or subsequently acquired, directly or indirectly.

Lock-Up Parties. The following persons and entities are parties to (or are expected to become parties to) lock-up agreements in connection with this offering:

Directors:

• Garrett Calloway (Chief Executive Officer and Chairman of the Board)

• Elaine Briggs (President and Director)

• Hugh Pemberton (Independent Director)

• Diane Kovac (Independent Director)

• Warren Okoro (Independent Director)

• Catherine Liang (Independent Director)

• Richard Estavez (Independent Director and designee of Pinnacle Vista Capital Partners III, LP)

Named Executive Officers:

• Marcus Yoon (Chief Financial Officer)

• Sandra Haverford (Chief Operating Officer)

• Dale Renfroe (General Counsel and Corporate Secretary)

• Priya Anand (Chief Technology Officer)

• Tomás Quintero (Senior Vice President, Project Development)

• Rachel Whitmore (Senior Vice President, Corporate Strategy)

Other Locked-Up Parties:

• Pinnacle Vista Capital Partners III, LP

• Any other holder of 1% or more of the pre-IPO common stock of the Company

As of the date of the most recent update to this prospectus (June 17, 2022), 15 of the 18 identified lock-up signatories had executed and delivered their respective lock-up agreements. The remaining three identified signatories were expected to execute and deliver their lock-up agreements prior to the pricing of this offering. As noted elsewhere in this prospectus, this offering has been placed in dormant status as of June 17, 2022, and, accordingly, the execution of such remaining lock-up agreements has not yet occurred.

Lock-Up Carve-Outs and Exceptions

The lock-up agreements described above contain customary exceptions permitting the following transactions, notwithstanding the lock-up restrictions:

(a) Transfers to Affiliates. Transfers of shares to affiliates of the locked-up party, provided that the transferee agrees in writing to be bound by the terms and conditions of the lock-up agreement for the remainder of the lock-up period, and provided further that no filing under Section 16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is required or shall be voluntarily made in connection with such transfer during the lock-up period.

(b) Estate-Planning Transfers. Transfers of shares for bona fide estate-planning purposes, including transfers to revocable or irrevocable trusts for the benefit of the locked-up party or members of the locked-up party's immediate family, transfers to family members, or transfers to family limited partnerships, family limited liability companies, or other similar entities controlled by the locked-up party or members of the locked-up party's immediate family, in each case provided that the transferee agrees in writing to be bound by the terms and conditions of the lock-up agreement for the remainder of the lock-up period, and provided further that no filing under Section 16(a) of the Exchange Act is required or shall be voluntarily made in connection with such transfer during the lock-up period (other than any required filing on Form 5, which shall indicate in the footnotes thereto that such transfer was made for estate-planning purposes).

(c) Rule 10b5-1 Trading Plans. The establishment or adoption of a written plan meeting the requirements of Rule 10b5-1 under the Exchange Act for the trading of shares of common stock, provided that (i) such plan does not provide for the transfer or disposition of shares of common stock during the lock-up period, and (ii) no public announcement or filing under the Exchange Act regarding the establishment of such plan shall be required of or voluntarily made by or on behalf of the locked-up party during the lock-up period.

(d) Pledges. The pledge of shares as collateral for bona fide loans from financial institutions, provided that any foreclosure, margin call, or other similar disposition of such pledged shares during the lock-up period would be subject to the lock-up restrictions, and provided further that no filing under Section 16(a) of the Exchange Act is required or shall be voluntarily made in connection with such pledge during the lock-up period.

In each case, the exceptions described above are subject to additional conditions and limitations as set forth in the lock-up agreements. Copies of the form of lock-up agreement are filed as an exhibit to the registration statement of which this prospectus forms a part.

Early Release Provisions

The lock-up agreements provide that the lock-up restrictions may be released prior to the expiration of the 180-day lock-up period upon:

(a) the prior written consent of Hargrove Keating & Co. (which consent may be given or withheld in the sole and absolute discretion of Hargrove Keating & Co.), provided that, in the event that Hargrove Keating & Co. agrees to release or waive the lock-up restrictions with respect to any locked-up party or any material portion of the shares subject to lock-up, Hargrove Keating & Co. will notify the Company of the impending release or waiver at least three business days before the effective date of such release or waiver, and the Company will announce the impending release or waiver by press release through a major news service at least two business days before the effective date of such release or waiver; or

(b) the occurrence of a Change of Control (as defined in the lock-up agreement), including, without limitation, any merger, consolidation, tender offer, exchange offer, or other business combination pursuant to which the holders of common stock of the Company immediately prior to such transaction would cease to hold a majority of the voting power of the surviving or resulting entity immediately following such transaction.

Hargrove Keating & Co. has informed the Company that it currently has no intention to release any shares from the lock-up restrictions prior to the expiration of the 180-day lock-up period. However, Hargrove Keating & Co. may, in its sole discretion, release all or any portion of the shares subject to lock-up at any time and without prior notice to the Company or the public, except as described in clause (a) above.

Issuer Lock-Up. In addition to the lock-up agreements entered into by the persons and entities described above, the Company has agreed in the underwriting agreement that, for a period of 180 days following the date of the final prospectus relating to this offering, the Company will not, without the prior written consent of Hargrove Keating & Co., (i) offer, sell, contract to sell, pledge, grant any option to purchase, make any short sale, or otherwise transfer or dispose of, directly or indirectly, any shares of common stock or any securities convertible into, exercisable for, or exchangeable for shares of common stock, or (ii) file or cause to be filed any registration statement with the SEC relating to the offering of any shares of common stock or any securities convertible into, exercisable for, or exchangeable for common stock, subject to customary exceptions, including:

• the issuance of shares of common stock or securities convertible into or exercisable for common stock pursuant to the 2022 Omnibus Equity Incentive Plan and the 2022 Employee Stock Purchase Plan, in each case as described in this prospectus;

• the issuance of shares of common stock in connection with acquisitions of businesses, assets, or technologies, provided that the aggregate number of shares so issued does not exceed 5% of the total number of shares of common stock outstanding immediately after the closing of this offering, and provided further that the recipients of such shares agree to be bound by lock-up restrictions for the remainder of the 180-day lock-up period;

• the filing of one or more registration statements on Form S-8 relating to equity compensation plans described in this prospectus; and

• other customary carve-outs as negotiated between Calderwood & Harkness LLP, counsel to the Company, and Prescott, Danforth & Yee LLP, counsel to the underwriters.

Rule 144

In general, under Rule 144 as currently in effect, beginning 90 days after the date of the final prospectus relating to this offering, a person (or persons whose shares are aggregated) may sell shares of our common stock subject to the conditions summarized below. Rule 144 provides a safe harbor from the registration requirements of the Securities Act for the resale of "restricted securities" (as defined in Rule 144) and for the resale of securities held by "affiliates" (as defined in Rule 144) of the issuer, in each case subject to specified conditions.

Non-Affiliates. A person (or persons whose shares are aggregated) who is not deemed to have been an affiliate of the Company at any time during the 90 days preceding a sale and who has beneficially owned the shares proposed to be sold for at least six months (including any period of ownership by any prior owner other than an affiliate of the Company) would be entitled to sell those shares in the public market without regard to the volume limitations, manner-of-sale requirements, or notice provisions of Rule 144, subject only to the requirement that current public information about the Company be available at the time of sale. This current public information requirement is satisfied if the Company has been subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act for at least 90 days prior to such sale and is current in its Exchange Act reporting obligations at the time of such sale, or has made publicly available certain prescribed information (including its name, the nature of its business, and certain financial information).

Following one year from the later of the date of acquisition of shares from the Company or from an affiliate of the Company, a person who is not deemed to have been an affiliate of the Company at any time during the 90 days preceding a sale may sell such shares without compliance with any of the conditions of Rule 144, including the current public information requirement described above.

Affiliates. A person (or persons whose shares are aggregated) who is deemed to be an affiliate of the Company and who has beneficially owned restricted shares of common stock for at least six months (including any period of ownership by any prior owner other than an affiliate of the Company) would be entitled to sell, within any three-month period, a number of shares that does not exceed the greater of:

• 1% of the number of shares of common stock then outstanding, which will be approximately 1,237,136 shares immediately after this offering (based on the base offering, assuming no exercise of the underwriters' overallotment option) or approximately 1,272,727 shares (assuming full exercise of the underwriters' overallotment option); or

• the average weekly reported trading volume of the common stock on the New York Stock Exchange during the four calendar weeks preceding the filing of a notice of proposed sale on Form 144 with the SEC.

Sales by affiliates under Rule 144 are also subject to the following additional conditions:

• Manner of Sale. The shares must be sold in "brokers' transactions" within the meaning of Section 4(a)(4) of the Securities Act (which generally means that the broker may not solicit or arrange for the solicitation of customers' orders to buy the securities in anticipation of or in connection with the transaction) or in transactions directly with a "market maker" (as defined in Section 3(a)(38) of the Exchange Act). Certain additional conditions apply to brokers' transactions under Rule 144.

• Notice Requirements. The seller must file a notice of proposed sale on Form 144 with the SEC concurrently with the placing of the sell order, if the number of shares to be sold during any three-month period exceeds 5,000 shares or the aggregate sale price exceeds $50,000.

• Current Public Information. Adequate current public information with respect to the Company must be available at the time of sale, as described above for non-affiliate sales.

Status of CBR's Pre-IPO Stockholders

Following the completion of this offering, Pinnacle Vista Capital Partners III, LP, Garrett Calloway, Elaine Briggs, and each of the other directors and executive officers identified above are expected to be deemed affiliates of the Company for purposes of Rule 144. As a result, any resales of shares of common stock by such persons will be subject to both the lock-up restrictions described above and, upon the expiration of the lock-up period, the volume, manner-of-sale, notice, and current public information limitations of Rule 144.

Pre-IPO stockholders who are not deemed affiliates of the Company and who are not subject to lock-up agreements will be eligible to sell their shares of common stock under Rule 144 beginning 90 days after the date of the final prospectus relating to this offering (or, if later, six months after the date on which such shares were acquired from the Company or from an affiliate of the Company), subject to the conditions described above. After satisfying a one-year holding period (measured from the later of the date of acquisition from the Company or from an affiliate of the Company), such non-affiliate stockholders may sell without compliance with any of the conditions of Rule 144.

Rule 701

Under Rule 701 under the Securities Act ("Rule 701"), shares of our common stock acquired by our employees, directors, officers, consultants, or advisors pursuant to written compensatory benefit plans or written contracts relating to compensation that were entered into prior to the completion of this offering are eligible for resale beginning 90 days after the date of the final prospectus relating to this offering in reliance on Rule 701 and, to the extent applicable, Rule 144.

Rule 701 provides that:

• Non-Affiliates. A person who is not an affiliate of the Company at the time of sale and who acquired shares under a compensatory arrangement prior to the completion of this offering may sell such shares in reliance on Rule 701 without compliance with the public-information, holding-period, volume-limitation, or manner-of-sale provisions of Rule 144.

• Affiliates. A person who is an affiliate of the Company at the time of sale and who acquired shares under a compensatory arrangement prior to the completion of this offering may sell such shares in reliance on Rule 701, but such sales will remain subject to the manner-of-sale, current public-information, and notice (Form 144 filing) requirements of Rule 144. However, such affiliate sellers will not be required to comply with the six-month holding-period requirement that would otherwise apply under Rule 144.

Notwithstanding the foregoing, substantially all shares of common stock issuable under compensatory arrangements prior to the completion of this offering will also be subject to the 180-day lock-up agreements described above. As a result, such shares will not be eligible for sale in the public market until after the expiration of the 180-day lock-up period, regardless of the availability of Rule 701. Upon the expiration of the lock-up period, shares held by non-affiliates may be sold without restriction under Rule 701, while shares held by affiliates will remain subject to the applicable conditions of Rule 144.

Registration Rights Agreement

Parties and Overview

We have entered into a Registration Rights Agreement, dated as of January 15, 2019, as amended and restated in connection with this offering (the "Registration Rights Agreement"), with Pinnacle Vista Capital Partners III, LP ("Pinnacle Vista") and its permitted transferees (collectively, the "Pinnacle Vista Holders"). The Registration Rights Agreement is governed by the laws of the State of Delaware, without regard to its principles of conflicts of laws, and provides the Pinnacle Vista Holders with certain demand, piggyback, and shelf registration rights with respect to shares of our common stock held by the Pinnacle Vista Holders, as described in more detail below.

Demand Registration Rights

Pursuant to the Registration Rights Agreement, the Pinnacle Vista Holders have the right, subject to the limitations described below, to require us to file a registration statement under the Securities Act covering the resale of all or a portion of the registrable securities held by the Pinnacle Vista Holders (a "demand registration"). The obligation to effect a demand registration is subject to the following conditions and limitations:

• Minimum Offering Size. We are not obligated to effect a demand registration unless the registrable securities to be included in such registration have an aggregate anticipated offering price (before deduction of underwriting discounts and commissions) of at least $50,000,000.

• Maximum Number of Demand Registrations. The Pinnacle Vista Holders are entitled to a maximum of four demand registrations in the aggregate, of which no more than two may be requested in any twelve-month period.

• Blackout and Postponement Rights. We have the right to postpone the filing or effectiveness of a demand registration for a period not to exceed 90 days if our board of directors determines in good faith that (i) such filing or effectiveness would require the disclosure of material nonpublic information that, in the good-faith judgment of the board of directors, would be detrimental to the Company if disclosed at such time, or (ii) such filing or effectiveness would materially interfere with a significant acquisition, disposition, financing, or other material transaction involving the Company. We may exercise this postponement right no more than twice in any twelve-month period, and the total number of days of postponement in any twelve-month period may not exceed 120 days.

Piggyback Registration Rights

If we propose to file a registration statement under the Securities Act for a public offering of shares of our common stock for our own account or for the account of other securityholders (other than a registration statement on Form S-4, Form S-8, or any successor form thereto, or a registration statement filed in connection with an exchange offer or an offering of securities solely to our existing securityholders), the Pinnacle Vista Holders have the right to include all or a portion of their registrable securities in such registration (a "piggyback registration"), subject to the customary cut-back provisions described below.

If the managing underwriter of any such offering advises us in writing that the total number of shares of common stock to be included in such registration exceeds the number of shares that can be sold in an orderly manner in such offering within a price range acceptable to us (in the case of a primary offering) or to the selling securityholders who initiated such registration (in the case of a secondary offering), without adversely affecting the price, timing, or distribution of the securities offered or the market for such securities, then the shares to be included in such registration will be allocated and cut back in the following order of priority:

(a) first, the shares proposed to be sold by us (in the case of a primary offering by the Company) or by the securityholders who initiated such registration (in the case of a demand registration initiated by securityholders other than the Pinnacle Vista Holders);

(b) second, the shares requested to be included by other selling securityholders (other than the Pinnacle Vista Holders), allocated pro rata among such selling securityholders based on the number of registrable securities requested to be included by each such selling securityholder;

(d) fourth, any other shares requested to be included in such registration.

S-3 Shelf Registration Rights

Upon the Company becoming eligible to use a registration statement on Form S-3 under the Securities Act for the registration of secondary sales of shares of common stock (which eligibility the Company expects to achieve approximately 12 months after the completion of this offering), the Pinnacle Vista Holders have the right to request that we file a shelf registration statement on Form S-3 (a "shelf registration statement") covering the resale of all or a portion of the registrable securities held by the Pinnacle Vista Holders on a continuous or delayed basis pursuant to Rule 415 under the Securities Act.

We have agreed, subject to certain conditions, to use our reasonable best efforts to cause such shelf registration statement to be declared effective by the SEC as promptly as practicable and to keep such shelf registration statement continuously effective (including by filing any necessary post-effective amendments and supplements thereto) until the earlier of (i) the date on which all registrable securities covered by such shelf registration statement have been sold, (ii) the date on which all registrable securities covered by such shelf registration statement may be sold without registration under the Securities Act and without volume or manner-of-sale limitations under Rule 144, and (iii) such other date as may be specified in the Registration Rights Agreement.

The Pinnacle Vista Holders also have the right to request that we facilitate one or more underwritten takedowns from the shelf registration statement, subject to minimum offering size thresholds and other limitations set forth in the Registration Rights Agreement. We are not obligated to effect more than two underwritten takedowns in any twelve-month period.

Expenses and Indemnification

We will bear all registration expenses incurred in connection with the registration of registrable securities pursuant to the Registration Rights Agreement, including, without limitation, all registration and filing fees, fees and expenses of compliance with securities or blue sky laws, printing expenses, fees and disbursements of our counsel and our independent registered public accounting firm, fees and expenses of any special experts retained by us in connection with such registration, and fees and expenses of one counsel to the selling securityholders (not to exceed $75,000 per registration). Notwithstanding the foregoing, we will not bear any underwriting discounts, selling commissions, or stock transfer taxes applicable to the sale of registrable securities by the selling securityholders.

The Registration Rights Agreement contains customary mutual indemnification provisions pursuant to which (i) we have agreed to indemnify and hold harmless the Pinnacle Vista Holders and their respective officers, directors, partners, members, managers, agents, and representatives against certain losses, claims, damages, or liabilities (including reasonable legal fees and expenses) arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in any registration statement, prospectus, or related document, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading (other than information provided in writing by the selling securityholder expressly for use therein), and (ii) the Pinnacle Vista Holders have agreed severally, and not jointly, to indemnify and hold harmless the Company and its respective officers, directors, agents, and representatives against certain losses, claims, damages, or liabilities arising out of or based upon any untrue statement or alleged untrue statement of a material fact, or any omission or alleged omission to state a material fact, in each case to the extent that such untrue statement or omission was made in reliance upon and in conformity with information provided in writing by the selling securityholder expressly for use in such registration statement, prospectus, or related document.

Registrable Securities. For purposes of the Registration Rights Agreement, "registrable securities" includes all shares of common stock held by the Pinnacle Vista Holders and their permitted transferees, as well as any shares of common stock issued or issuable with respect to such shares by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, reclassification, merger, consolidation, or similar reorganization. Shares will cease to be "registrable securities" upon the earliest of (i) the date on which such shares have been sold pursuant to an effective registration statement under the Securities Act, (ii) the date on which such shares have been sold in a transaction exempt from the registration and prospectus-delivery requirements of the Securities Act (including pursuant to Rule 144) such that all transfer restrictions and restrictive legends with respect thereto are removed, (iii) the date on which such shares become eligible for resale under Rule 144 without volume or manner-of-sale limitations and without the requirement for current public information, and (iv) the date on which the holder of such shares (together with its affiliates, partners, members, and former members) holds registrable securities representing less than 1% of the outstanding common stock of the Company.

Equity Compensation Plans — Form S-8 Registration

2022 Omnibus Equity Incentive Plan

We intend to file a registration statement on Form S-8 under the Securities Act promptly following the completion of this offering to register the shares of common stock reserved for issuance under our 2022 Omnibus Equity Incentive Plan (the "2022 Plan"). We have reserved 12,727,273 shares of common stock for issuance under the 2022 Plan, representing approximately 10% of the 127,272,727 shares of common stock expected to be outstanding immediately following the completion of this offering, assuming full exercise of the underwriters' overallotment option.

The 2022 Plan provides for the grant of stock options (including incentive stock options and non-qualified stock options), restricted stock awards, restricted stock units ("RSUs"), performance stock units ("PSUs"), stock appreciation rights, and other equity-based awards to our employees, directors, officers, consultants, and advisors. The 2022 Plan also includes an "evergreen" provision pursuant to which the number of shares of common stock reserved for issuance under the 2022 Plan will automatically increase on the first day of each fiscal year beginning with the fiscal year commencing January 1, 2024, by a number of shares equal to the lesser of (i) 2% of the total number of shares of common stock outstanding on the last day of the immediately preceding fiscal year and (ii) a number of shares determined by our board of directors. For a complete description of the terms of the 2022 Plan, see "Executive Compensation — 2022 Omnibus Equity Incentive Plan."

Upon the registration statement on Form S-8 becoming effective, shares of common stock issued under the 2022 Plan (other than shares held by affiliates of the Company, which will remain subject to the volume and manner-of-sale limitations of Rule 144) will be available for sale in the public market, subject to any applicable lock-up restrictions described above and the satisfaction of any applicable vesting conditions. We expect the registration statement on Form S-8 to become effective promptly following the completion of this offering, subject to processing times at the SEC.

2022 Employee Stock Purchase Plan

We also intend to file a registration statement on Form S-8 under the Securities Act to register shares of common stock reserved for issuance under our 2022 Employee Stock Purchase Plan (the "ESPP"). We have reserved 2,545,455 shares of common stock for issuance under the ESPP, representing approximately 2% of the 127,272,727 shares of common stock expected to be outstanding immediately following the completion of this offering, assuming full exercise of the underwriters' overallotment option.

The ESPP is intended to qualify as an "employee stock purchase plan" under Section 423 of the Internal Revenue Code of 1986, as amended (the "Code"). Under the ESPP, eligible employees may purchase shares of our common stock at a price equal to 85% of the lower of (i) the fair market value of the common stock on the first day of the applicable offering period and (ii) the fair market value of the common stock on the last day (i.e., the purchase date) of the applicable offering period. Offering periods under the ESPP are six months in duration, commencing on each January 1 and July 1 (or such other dates as determined by our board of directors or compensation committee). For a complete description of the terms of the ESPP, see "Executive Compensation — 2022 Employee Stock Purchase Plan."

Shares of common stock purchased by participants under the ESPP and registered on Form S-8 generally will be available for sale in the public market immediately upon purchase, subject to any applicable lock-up restrictions described above. Shares held by affiliates of the Company that are purchased under the ESPP will remain subject to the volume and manner-of-sale limitations of Rule 144.

IPO Equity Grants

In connection with this offering, we expect to grant RSU awards under the 2022 Plan to certain of our executive officers and other key employees. The following table sets forth the RSU grants expected to be made to our named executive officers in connection with the IPO:

Each of the RSU awards described above is subject to four-year ratable vesting, with 25% of the RSUs vesting on each of the first four anniversaries of the grant date, subject to the executive officer's continued service with the Company through each applicable vesting date. Shares of common stock issued upon the vesting and settlement of these RSU awards will be registered on Form S-8 and will generally be available for sale in the public market upon issuance, subject to (i) the 180-day lock-up restrictions described above and (ii) for affiliates of the Company, the volume, manner-of-sale, notice, and current public-information limitations of Rule 144.

Stockholders' Agreement

We have entered into an Amended and Restated Stockholders' Agreement, dated as of the closing date of this offering (the "Stockholders' Agreement"), among the Company, Pinnacle Vista Capital Partners III, LP, Garrett Calloway, and Elaine Briggs (collectively, with their respective permitted transferees, the "Stockholder Parties"). The Stockholders' Agreement will become effective upon the closing of this offering and will supersede all prior agreements among the Stockholder Parties with respect to the matters addressed therein.

The Stockholders' Agreement contains certain transfer restrictions on shares of common stock held by the Stockholder Parties, including, without limitation:

• Rights of First Refusal. Prior to any proposed sale or transfer of shares by a Stockholder Party (other than sales in the public market pursuant to an effective registration statement or in compliance with Rule 144, and other than certain permitted transfers), the transferring Stockholder Party must first offer such shares to the Company and then to the other Stockholder Parties on the same terms and conditions as the proposed sale.

• Tag-Along Rights. In the event that Pinnacle Vista proposes to sell or transfer shares of common stock to a third party (other than in a public market transaction or a permitted transfer), the Founders have the right to participate in such sale or transfer on a pro rata basis and on the same terms and conditions as Pinnacle Vista.

• Standstill Provisions. Pinnacle Vista has agreed, subject to certain exceptions, not to acquire additional shares of common stock or other equity securities of the Company without the prior approval of the board of directors (excluding any Pinnacle Vista designees serving on the board).

The transfer restrictions set forth in the Stockholders' Agreement are in addition to, and not in lieu of, the lock-up restrictions described above and the limitations on resale imposed by Rule 144 under the Securities Act. To the extent that the lock-up restrictions, Rule 144 limitations, and the Stockholders' Agreement transfer restrictions apply concurrently, the most restrictive provision will control. For a more complete description of the terms and conditions of the Stockholders' Agreement, see "Certain Relationships and Related-Party Transactions — Stockholders' Agreement."

Controlled-Company and Affiliate Status Considerations

Following the completion of this offering, Pinnacle Vista Capital Partners III, LP is expected to beneficially own approximately 55,181,818 shares of our common stock, representing approximately 44.6% of our outstanding common stock (assuming the base offering with no exercise of the underwriters' overallotment option), or approximately 43.4% of our outstanding common stock (assuming full exercise of the underwriters' overallotment option). In each case, the foregoing percentages are calculated based on the number of shares outstanding immediately following the completion of this offering and give effect to the sale of 6,818,182 shares by Pinnacle Vista in the secondary offering component of this offering.

Together with shares held by the Founders, Garrett Calloway and Elaine Briggs, that are subject to the voting and other provisions of the Stockholders' Agreement, Pinnacle Vista may be deemed to control the Company for purposes of the Securities Act and the Exchange Act. As a result, Pinnacle Vista and each of the Founders may be deemed "affiliates" of the Company under Rule 144, and their resales of shares of common stock following the offering will be subject to the volume, manner-of-sale, notice, and current public information limitations of Rule 144, in addition to the 180-day lock-up restrictions described above and the transfer restrictions set forth in the Stockholders' Agreement. For so long as Pinnacle Vista and the Founders are deemed affiliates of the Company, they will not be able to sell shares of common stock in the public market without complying with Rule 144 or pursuant to an effective registration statement under the Securities Act.

In addition, for so long as Pinnacle Vista (together with its affiliates) beneficially owns more than 50% of the voting power of our outstanding common stock, we intend to rely on the "controlled company" exemption under the listing standards of the New York Stock Exchange, which permits us to elect not to comply with certain corporate governance requirements. If at any time following this offering Pinnacle Vista's beneficial ownership falls below 50% of the voting power of our outstanding common stock, we will no longer qualify for the controlled-company exemption and will be required to comply with the applicable NYSE corporate governance requirements within the transition periods specified by the NYSE listing standards. For a description of the controlled-company exemption and the corporate governance requirements from which we may be exempt, see "Management and Board of Directors — Controlled-Company Exemption" and "Risk Factors — Risks Relating to This Offering and Ownership of Our Common Stock — We are a controlled company within the meaning of the NYSE listing standards and, as a result, qualify for exemptions from certain corporate governance requirements."

Effect of Sales on Market Price

Sales of substantial numbers of shares of our common stock in the public market after this offering, or the perception that such sales could occur (including in anticipation of or upon the expiration of the 180-day lock-up period), could adversely affect the prevailing market price of our common stock and could materially impair our future ability to raise capital through equity offerings at times and prices that we deem appropriate. In particular:

• Approximately 76,286,364 restricted shares of our common stock (based on the base offering, assuming no exercise of the underwriters' overallotment option) will become eligible for sale in the public market upon the expiration of the 180-day lock-up period, subject to the volume, manner-of-sale, and other limitations of Rule 144 for affiliates. These shares represent approximately 61.7% of the total number of shares of common stock expected to be outstanding immediately following the completion of this offering.

• Additional shares of common stock may be registered for resale under the Securities Act pursuant to the Registration Rights Agreement described above, including by means of demand registrations, piggyback registrations, or a shelf registration statement on Form S-3.

• Shares of common stock issued under the 2022 Omnibus Equity Incentive Plan and the 2022 Employee Stock Purchase Plan and registered on Form S-8 will become eligible for sale in the public market upon issuance (subject to applicable lock-up restrictions and vesting conditions and, for affiliates, Rule 144 limitations). As additional shares vest and are settled under outstanding equity awards, the number of shares eligible for public sale will increase.

The release of a substantial number of shares into the public market at any time, whether upon the expiration of the lock-up period, the effectiveness of a registration statement covering registrable securities held by Pinnacle Vista, or otherwise, could cause the market price of our common stock to decline significantly. Moreover, the mere perception that such sales could occur may itself adversely affect the market price of our common stock, regardless of whether any such sales have actually occurred or are currently anticipated. We cannot predict the effect that future sales of our common stock in the public market, or the availability of shares for future sale, will have on the market price of our common stock.

Category	Number of Shares	Notes
Shares sold in this offering (base offering, no overallotment exercise)	23,713,636	Freely tradable immediately upon completion of this offering (except shares purchased by affiliates, which will be subject to Rule 144 limitations)
Additional shares issuable upon full exercise of the underwriters' overallotment option	3,559,091	Freely tradable immediately upon issuance (except shares purchased by affiliates, which will be subject to Rule 144 limitations)
Restricted shares held by pre-IPO stockholders (subject to lock-up)	~76,286,364 (base offering)	Eligible for sale upon expiration of the 180-day lock-up period, subject to the volume and manner-of-sale limitations of Rule 144 for affiliates
Shares reserved for issuance under the 2022 Omnibus Equity Incentive Plan	12,727,273	Representing approximately 10% of the 127,272,727 shares expected to be outstanding assuming full exercise of the overallotment option; to be registered on Form S-8; subject to Rule 701 and, for affiliates, Rule 144 limitations
Shares reserved for issuance under the 2022 Employee Stock Purchase Plan	2,545,455	Representing approximately 2% of the 127,272,727 shares expected to be outstanding assuming full exercise of the overallotment option; to be registered on Form S-8
Named Executive Officer	Title	RSUs to be Granted	Vesting Schedule
Garrett Calloway	Chief Executive Officer and Chairman	500,000	Four-year ratable vesting (25% per year)
Elaine Briggs	President	400,000	Four-year ratable vesting (25% per year)
Marcus Yoon	Chief Financial Officer	300,000	Four-year ratable vesting (25% per year)
Sandra Haverford	Chief Operating Officer	200,000	Four-year ratable vesting (25% per year)
Dale Renfroe	General Counsel and Corporate Secretary	175,000	Four-year ratable vesting (25% per year)
Priya Anand	Chief Technology Officer	175,000	Four-year ratable vesting (25% per year)
Tomás Quintero	SVP, Project Development	150,000	Four-year ratable vesting (25% per year)
Rachel Whitmore	SVP, Corporate Strategy	150,000	Four-year ratable vesting (25% per year)

CONFIDENTIAL TREATMENT REQUESTED — DRAFT — NOT FOR DISTRIBUTION
SHARES ELIGIBLE FOR FUTURE SALE
Future sales of substantial amounts of our common stock in the public market after this offering, or the perception that such sales could occur, could adversely affect the prevailing market price of our common stock and could impair our ability to raise capital through future equity offerings. We have analyzed the potential impact of future sales on the trading market for our common stock and have set forth below a description of the number of shares of our common stock that will be available for future sale upon completion of this offering, as well as the timing of such availability and applicable restrictions on resale.
Upon completion of this offering, we will have 123,713,636 shares of our common stock outstanding, assuming no exercise of the underwriters' overallotment option, or 127,272,727 shares of our common stock outstanding, assuming full exercise of the underwriters' overallotment option. In each case, the foregoing is based on 100,000,000 shares of our common stock outstanding immediately prior to the closing of this offering and assumes an initial public offering price of $22.00 per share, the midpoint of the estimated offering price range set forth on the cover page of this prospectus. The foregoing excludes (i) 12,727,273 shares of common stock reserved for future issuance under our 2022 Omnibus Equity Incentive Plan, (ii) 2,545,455 shares of common stock reserved for future issuance under our 2022 Employee Stock Purchase Plan, and (iii) any shares issuable upon exercise of the underwriters' overallotment option, except where the full exercise of such option is specifically assumed.
All of the 23,713,636 shares of common stock to be sold in this offering (or 27,272,727 shares if the underwriters exercise their overallotment option in full) will be freely tradable without restriction or further registration under the Securities Act of 1933, as amended (the "Securities Act"), unless such shares are purchased by "affiliates" of the Company, as that term is defined in Rule 144 under the Securities Act ("Rule 144"). Shares purchased by affiliates will be subject to the resale limitations of Rule 144 described below.
The remaining shares of common stock outstanding after this offering will be "restricted securities" as that term is defined in Rule 144. Restricted securities may be sold in the public market only if such sale is registered under the Securities Act or if the sale qualifies for an exemption from registration, including, without limitation, under Rules 144 and 701 under the Securities Act, each of which is summarized below. In addition, substantially all of these restricted securities will be subject to the 180-day lock-up agreements described below.
For a discussion of certain risks relating to future sales of our common stock and the potential impact on the market price for our shares, see "Risk Factors — Risks Relating to This Offering and Ownership of Our Common Stock."
Share Summary
The following table summarizes, on an approximate basis, the total number of shares of our common stock that will be outstanding or reserved for issuance upon completion of this offering and the timing of their eligibility for sale in the public market:
The restricted shares described above include the following categories of pre-IPO stockholders:
Pinnacle Vista Capital Partners III, LP. Pinnacle Vista Capital Partners III, LP ("Pinnacle Vista") holds approximately 62,000,000 shares of our common stock as of immediately prior to the closing of this offering, representing approximately 62% of our fully diluted common stock as of such date. In connection with this offering, Pinnacle Vista is selling 6,818,182 shares in the secondary offering component of this offering for aggregate gross proceeds of approximately $150,000,000 (at an assumed initial public offering price of $22.00 per share), and will retain approximately 55,181,818 shares following the completion of this offering. All shares retained by Pinnacle Vista following the offering are subject to the 180-day lock-up agreement described below and, upon expiration of the lock-up period, will be subject to Rule 144 limitations applicable to affiliates and the transfer restrictions and registration rights set forth in the Registration Rights Agreement described below.
Founders. Shares held by our co-founders, Garrett Calloway (our Chief Executive Officer and Chairman of the Board) and Elaine Briggs (our President and director), together with shares held by other members of management, represent approximately 24% of our pre-IPO shares, or approximately 24,000,000 shares in the aggregate. All such shares are subject to the 180-day lock-up agreements described below and, upon expiration of the lock-up period, will be subject to Rule 144 restrictions applicable to affiliates. In addition, shares held by Mr. Calloway and Ms. Briggs are subject to the Amended and Restated Stockholders' Agreement described below.
Earlier-Stage Investors and Employees. Shares held by our earlier-stage investors and employees represent approximately 14% of our pre-IPO shares, or approximately 14,000,000 shares in the aggregate. Shares held by holders of 1% or more of our pre-IPO shares are subject to lock-up agreements with Hargrove Keating & Co., as representative of the underwriters. Upon expiration of the applicable lock-up period, these shares will be eligible for resale under Rule 144, subject to the conditions described below. Shares held by pre-IPO stockholders who are not subject to lock-up agreements will be eligible for sale under Rule 144 beginning 90 days after the date of the final prospectus (subject to compliance with the conditions of Rule 144, including applicable holding-period requirements).
Lock-Up Agreements
Overview of Lock-Up Terms
Each of our directors, executive officers, Pinnacle Vista Capital Partners III, LP, and holders of 1% or more of our pre-IPO common stock (approximately 18 persons and entities in total) has entered into, or will enter into prior to the effectiveness of the registration statement of which this prospectus forms a part, a lock-up agreement with Hargrove Keating & Co., as representative of the underwriters of this offering. Pursuant to these lock-up agreements, each locked-up party has agreed that, for a period of 180 days following the date of the final prospectus relating to this offering (the "lock-up period"), such party will not, without the prior written consent of Hargrove Keating & Co.:
•  offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right, or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any shares of common stock or any securities convertible into or exercisable or exchangeable for common stock (including, without limitation, common stock that may be deemed to be beneficially owned by such party in accordance with the rules and regulations of the Securities and Exchange Commission (the "SEC") and securities that may be issued upon exercise of a stock option or warrant), whether any such transaction is to be settled by delivery of common stock or such other securities, in cash, or otherwise; or
•  enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the common stock, whether any such transaction is to be settled by delivery of common stock or such other securities, in cash, or otherwise.
The restrictions described in the preceding paragraph apply whether or not such transaction is to be settled by delivery of shares of common stock or other securities, in cash, or otherwise, and regardless of whether the shares or other securities are owned by the locked-up party or subsequently acquired, directly or indirectly.
Lock-Up Parties.  The following persons and entities are parties to (or are expected to become parties to) lock-up agreements in connection with this offering:
Directors:
•  Garrett Calloway (Chief Executive Officer and Chairman of the Board)
•  Elaine Briggs (President and Director)
•  Hugh Pemberton (Independent Director)
•  Diane Kovac (Independent Director)
•  Warren Okoro (Independent Director)
•  Catherine Liang (Independent Director)
•  Richard Estavez (Independent Director and designee of Pinnacle Vista Capital Partners III, LP)
Named Executive Officers:
•  Marcus Yoon (Chief Financial Officer)
•  Sandra Haverford (Chief Operating Officer)
•  Dale Renfroe (General Counsel and Corporate Secretary)
•  Priya Anand (Chief Technology Officer)
•  Tomás Quintero (Senior Vice President, Project Development)
•  Rachel Whitmore (Senior Vice President, Corporate Strategy)
Other Locked-Up Parties:
•  Pinnacle Vista Capital Partners III, LP
•  Any other holder of 1% or more of the pre-IPO common stock of the Company
As of the date of the most recent update to this prospectus (June 17, 2022), 15 of the 18 identified lock-up signatories had executed and delivered their respective lock-up agreements. The remaining three identified signatories were expected to execute and deliver their lock-up agreements prior to the pricing of this offering. As noted elsewhere in this prospectus, this offering has been placed in dormant status as of June 17, 2022, and, accordingly, the execution of such remaining lock-up agreements has not yet occurred.
Lock-Up Carve-Outs and Exceptions
The lock-up agreements described above contain customary exceptions permitting the following transactions, notwithstanding the lock-up restrictions:
(a) Transfers to Affiliates. Transfers of shares to affiliates of the locked-up party, provided that the transferee agrees in writing to be bound by the terms and conditions of the lock-up agreement for the remainder of the lock-up period, and provided further that no filing under Section 16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is required or shall be voluntarily made in connection with such transfer during the lock-up period.
(b) Estate-Planning Transfers. Transfers of shares for bona fide estate-planning purposes, including transfers to revocable or irrevocable trusts for the benefit of the locked-up party or members of the locked-up party's immediate family, transfers to family members, or transfers to family limited partnerships, family limited liability companies, or other similar entities controlled by the locked-up party or members of the locked-up party's immediate family, in each case provided that the transferee agrees in writing to be bound by the terms and conditions of the lock-up agreement for the remainder of the lock-up period, and provided further that no filing under Section 16(a) of the Exchange Act is required or shall be voluntarily made in connection with such transfer during the lock-up period (other than any required filing on Form 5, which shall indicate in the footnotes thereto that such transfer was made for estate-planning purposes).
(c) Rule 10b5-1 Trading Plans. The establishment or adoption of a written plan meeting the requirements of Rule 10b5-1 under the Exchange Act for the trading of shares of common stock, provided that (i) such plan does not provide for the transfer or disposition of shares of common stock during the lock-up period, and (ii) no public announcement or filing under the Exchange Act regarding the establishment of such plan shall be required of or voluntarily made by or on behalf of the locked-up party during the lock-up period.
(d) Pledges. The pledge of shares as collateral for bona fide loans from financial institutions, provided that any foreclosure, margin call, or other similar disposition of such pledged shares during the lock-up period would be subject to the lock-up restrictions, and provided further that no filing under Section 16(a) of the Exchange Act is required or shall be voluntarily made in connection with such pledge during the lock-up period.
In each case, the exceptions described above are subject to additional conditions and limitations as set forth in the lock-up agreements. Copies of the form of lock-up agreement are filed as an exhibit to the registration statement of which this prospectus forms a part.
Early Release Provisions
The lock-up agreements provide that the lock-up restrictions may be released prior to the expiration of the 180-day lock-up period upon:
(a) the prior written consent of Hargrove Keating & Co. (which consent may be given or withheld in the sole and absolute discretion of Hargrove Keating & Co.), provided that, in the event that Hargrove Keating & Co. agrees to release or waive the lock-up restrictions with respect to any locked-up party or any material portion of the shares subject to lock-up, Hargrove Keating & Co. will notify the Company of the impending release or waiver at least three business days before the effective date of such release or waiver, and the Company will announce the impending release or waiver by press release through a major news service at least two business days before the effective date of such release or waiver; or
(b) the occurrence of a Change of Control (as defined in the lock-up agreement), including, without limitation, any merger, consolidation, tender offer, exchange offer, or other business combination pursuant to which the holders of common stock of the Company immediately prior to such transaction would cease to hold a majority of the voting power of the surviving or resulting entity immediately following such transaction.
Hargrove Keating & Co. has informed the Company that it currently has no intention to release any shares from the lock-up restrictions prior to the expiration of the 180-day lock-up period. However, Hargrove Keating & Co. may, in its sole discretion, release all or any portion of the shares subject to lock-up at any time and without prior notice to the Company or the public, except as described in clause (a) above.
Issuer Lock-Up.  In addition to the lock-up agreements entered into by the persons and entities described above, the Company has agreed in the underwriting agreement that, for a period of 180 days following the date of the final prospectus relating to this offering, the Company will not, without the prior written consent of Hargrove Keating & Co., (i) offer, sell, contract to sell, pledge, grant any option to purchase, make any short sale, or otherwise transfer or dispose of, directly or indirectly, any shares of common stock or any securities convertible into, exercisable for, or exchangeable for shares of common stock, or (ii) file or cause to be filed any registration statement with the SEC relating to the offering of any shares of common stock or any securities convertible into, exercisable for, or exchangeable for common stock, subject to customary exceptions, including:
•  the issuance of shares of common stock or securities convertible into or exercisable for common stock pursuant to the 2022 Omnibus Equity Incentive Plan and the 2022 Employee Stock Purchase Plan, in each case as described in this prospectus;
•  the issuance of shares of common stock in connection with acquisitions of businesses, assets, or technologies, provided that the aggregate number of shares so issued does not exceed 5% of the total number of shares of common stock outstanding immediately after the closing of this offering, and provided further that the recipients of such shares agree to be bound by lock-up restrictions for the remainder of the 180-day lock-up period;
•  the filing of one or more registration statements on Form S-8 relating to equity compensation plans described in this prospectus; and
•  other customary carve-outs as negotiated between Calderwood & Harkness LLP, counsel to the Company, and Prescott, Danforth & Yee LLP, counsel to the underwriters.
Rule 144
In general, under Rule 144 as currently in effect, beginning 90 days after the date of the final prospectus relating to this offering, a person (or persons whose shares are aggregated) may sell shares of our common stock subject to the conditions summarized below. Rule 144 provides a safe harbor from the registration requirements of the Securities Act for the resale of "restricted securities" (as defined in Rule 144) and for the resale of securities held by "affiliates" (as defined in Rule 144) of the issuer, in each case subject to specified conditions.
Non-Affiliates.  A person (or persons whose shares are aggregated) who is not deemed to have been an affiliate of the Company at any time during the 90 days preceding a sale and who has beneficially owned the shares proposed to be sold for at least six months (including any period of ownership by any prior owner other than an affiliate of the Company) would be entitled to sell those shares in the public market without regard to the volume limitations, manner-of-sale requirements, or notice provisions of Rule 144, subject only to the requirement that current public information about the Company be available at the time of sale. This current public information requirement is satisfied if the Company has been subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act for at least 90 days prior to such sale and is current in its Exchange Act reporting obligations at the time of such sale, or has made publicly available certain prescribed information (including its name, the nature of its business, and certain financial information).
Following one year from the later of the date of acquisition of shares from the Company or from an affiliate of the Company, a person who is not deemed to have been an affiliate of the Company at any time during the 90 days preceding a sale may sell such shares without compliance with any of the conditions of Rule 144, including the current public information requirement described above.
Affiliates.  A person (or persons whose shares are aggregated) who is deemed to be an affiliate of the Company and who has beneficially owned restricted shares of common stock for at least six months (including any period of ownership by any prior owner other than an affiliate of the Company) would be entitled to sell, within any three-month period, a number of shares that does not exceed the greater of:
•  1% of the number of shares of common stock then outstanding, which will be approximately 1,237,136 shares immediately after this offering (based on the base offering, assuming no exercise of the underwriters' overallotment option) or approximately 1,272,727 shares (assuming full exercise of the underwriters' overallotment option); or
•  the average weekly reported trading volume of the common stock on the New York Stock Exchange during the four calendar weeks preceding the filing of a notice of proposed sale on Form 144 with the SEC.
Sales by affiliates under Rule 144 are also subject to the following additional conditions:
•  Manner of Sale. The shares must be sold in "brokers' transactions" within the meaning of Section 4(a)(4) of the Securities Act (which generally means that the broker may not solicit or arrange for the solicitation of customers' orders to buy the securities in anticipation of or in connection with the transaction) or in transactions directly with a "market maker" (as defined in Section 3(a)(38) of the Exchange Act). Certain additional conditions apply to brokers' transactions under Rule 144.
•  Notice Requirements. The seller must file a notice of proposed sale on Form 144 with the SEC concurrently with the placing of the sell order, if the number of shares to be sold during any three-month period exceeds 5,000 shares or the aggregate sale price exceeds $50,000.
•  Current Public Information. Adequate current public information with respect to the Company must be available at the time of sale, as described above for non-affiliate sales.
Status of CBR's Pre-IPO Stockholders
Following the completion of this offering, Pinnacle Vista Capital Partners III, LP, Garrett Calloway, Elaine Briggs, and each of the other directors and executive officers identified above are expected to be deemed affiliates of the Company for purposes of Rule 144. As a result, any resales of shares of common stock by such persons will be subject to both the lock-up restrictions described above and, upon the expiration of the lock-up period, the volume, manner-of-sale, notice, and current public information limitations of Rule 144.
Pre-IPO stockholders who are not deemed affiliates of the Company and who are not subject to lock-up agreements will be eligible to sell their shares of common stock under Rule 144 beginning 90 days after the date of the final prospectus relating to this offering (or, if later, six months after the date on which such shares were acquired from the Company or from an affiliate of the Company), subject to the conditions described above. After satisfying a one-year holding period (measured from the later of the date of acquisition from the Company or from an affiliate of the Company), such non-affiliate stockholders may sell without compliance with any of the conditions of Rule 144.
Rule 701
Under Rule 701 under the Securities Act ("Rule 701"), shares of our common stock acquired by our employees, directors, officers, consultants, or advisors pursuant to written compensatory benefit plans or written contracts relating to compensation that were entered into prior to the completion of this offering are eligible for resale beginning 90 days after the date of the final prospectus relating to this offering in reliance on Rule 701 and, to the extent applicable, Rule 144.
Rule 701 provides that:
•  Non-Affiliates. A person who is not an affiliate of the Company at the time of sale and who acquired shares under a compensatory arrangement prior to the completion of this offering may sell such shares in reliance on Rule 701 without compliance with the public-information, holding-period, volume-limitation, or manner-of-sale provisions of Rule 144.
•  Affiliates. A person who is an affiliate of the Company at the time of sale and who acquired shares under a compensatory arrangement prior to the completion of this offering may sell such shares in reliance on Rule 701, but such sales will remain subject to the manner-of-sale, current public-information, and notice (Form 144 filing) requirements of Rule 144. However, such affiliate sellers will not be required to comply with the six-month holding-period requirement that would otherwise apply under Rule 144.
Notwithstanding the foregoing, substantially all shares of common stock issuable under compensatory arrangements prior to the completion of this offering will also be subject to the 180-day lock-up agreements described above. As a result, such shares will not be eligible for sale in the public market until after the expiration of the 180-day lock-up period, regardless of the availability of Rule 701. Upon the expiration of the lock-up period, shares held by non-affiliates may be sold without restriction under Rule 701, while shares held by affiliates will remain subject to the applicable conditions of Rule 144.
Registration Rights Agreement
Parties and Overview
We have entered into a Registration Rights Agreement, dated as of January 15, 2019, as amended and restated in connection with this offering (the "Registration Rights Agreement"), with Pinnacle Vista Capital Partners III, LP ("Pinnacle Vista") and its permitted transferees (collectively, the "Pinnacle Vista Holders"). The Registration Rights Agreement is governed by the laws of the State of Delaware, without regard to its principles of conflicts of laws, and provides the Pinnacle Vista Holders with certain demand, piggyback, and shelf registration rights with respect to shares of our common stock held by the Pinnacle Vista Holders, as described in more detail below.
Demand Registration Rights
Pursuant to the Registration Rights Agreement, the Pinnacle Vista Holders have the right, subject to the limitations described below, to require us to file a registration statement under the Securities Act covering the resale of all or a portion of the registrable securities held by the Pinnacle Vista Holders (a "demand registration"). The obligation to effect a demand registration is subject to the following conditions and limitations:
•  Minimum Offering Size. We are not obligated to effect a demand registration unless the registrable securities to be included in such registration have an aggregate anticipated offering price (before deduction of underwriting discounts and commissions) of at least $50,000,000.
•  Maximum Number of Demand Registrations. The Pinnacle Vista Holders are entitled to a maximum of four demand registrations in the aggregate, of which no more than two may be requested in any twelve-month period.
•  Blackout and Postponement Rights. We have the right to postpone the filing or effectiveness of a demand registration for a period not to exceed 90 days if our board of directors determines in good faith that (i) such filing or effectiveness would require the disclosure of material nonpublic information that, in the good-faith judgment of the board of directors, would be detrimental to the Company if disclosed at such time, or (ii) such filing or effectiveness would materially interfere with a significant acquisition, disposition, financing, or other material transaction involving the Company. We may exercise this postponement right no more than twice in any twelve-month period, and the total number of days of postponement in any twelve-month period may not exceed 120 days.
Piggyback Registration Rights
If we propose to file a registration statement under the Securities Act for a public offering of shares of our common stock for our own account or for the account of other securityholders (other than a registration statement on Form S-4, Form S-8, or any successor form thereto, or a registration statement filed in connection with an exchange offer or an offering of securities solely to our existing securityholders), the Pinnacle Vista Holders have the right to include all or a portion of their registrable securities in such registration (a "piggyback registration"), subject to the customary cut-back provisions described below.
If the managing underwriter of any such offering advises us in writing that the total number of shares of common stock to be included in such registration exceeds the number of shares that can be sold in an orderly manner in such offering within a price range acceptable to us (in the case of a primary offering) or to the selling securityholders who initiated such registration (in the case of a secondary offering), without adversely affecting the price, timing, or distribution of the securities offered or the market for such securities, then the shares to be included in such registration will be allocated and cut back in the following order of priority:
(a) first, the shares proposed to be sold by us (in the case of a primary offering by the Company) or by the securityholders who initiated such registration (in the case of a demand registration initiated by securityholders other than the Pinnacle Vista Holders);
(b) second, the shares requested to be included by other selling securityholders (other than the Pinnacle Vista Holders), allocated pro rata among such selling securityholders based on the number of registrable securities requested to be included by each such selling securityholder;
(c) third, the shares requested to be included by the Pinnacle Vista Holders; and
(d) fourth, any other shares requested to be included in such registration.
S-3 Shelf Registration Rights
Upon the Company becoming eligible to use a registration statement on Form S-3 under the Securities Act for the registration of secondary sales of shares of common stock (which eligibility the Company expects to achieve approximately 12 months after the completion of this offering), the Pinnacle Vista Holders have the right to request that we file a shelf registration statement on Form S-3 (a "shelf registration statement") covering the resale of all or a portion of the registrable securities held by the Pinnacle Vista Holders on a continuous or delayed basis pursuant to Rule 415 under the Securities Act.
We have agreed, subject to certain conditions, to use our reasonable best efforts to cause such shelf registration statement to be declared effective by the SEC as promptly as practicable and to keep such shelf registration statement continuously effective (including by filing any necessary post-effective amendments and supplements thereto) until the earlier of (i) the date on which all registrable securities covered by such shelf registration statement have been sold, (ii) the date on which all registrable securities covered by such shelf registration statement may be sold without registration under the Securities Act and without volume or manner-of-sale limitations under Rule 144, and (iii) such other date as may be specified in the Registration Rights Agreement.
The Pinnacle Vista Holders also have the right to request that we facilitate one or more underwritten takedowns from the shelf registration statement, subject to minimum offering size thresholds and other limitations set forth in the Registration Rights Agreement. We are not obligated to effect more than two underwritten takedowns in any twelve-month period.
Expenses and Indemnification
We will bear all registration expenses incurred in connection with the registration of registrable securities pursuant to the Registration Rights Agreement, including, without limitation, all registration and filing fees, fees and expenses of compliance with securities or blue sky laws, printing expenses, fees and disbursements of our counsel and our independent registered public accounting firm, fees and expenses of any special experts retained by us in connection with such registration, and fees and expenses of one counsel to the selling securityholders (not to exceed $75,000 per registration). Notwithstanding the foregoing, we will not bear any underwriting discounts, selling commissions, or stock transfer taxes applicable to the sale of registrable securities by the selling securityholders.
The Registration Rights Agreement contains customary mutual indemnification provisions pursuant to which (i) we have agreed to indemnify and hold harmless the Pinnacle Vista Holders and their respective officers, directors, partners, members, managers, agents, and representatives against certain losses, claims, damages, or liabilities (including reasonable legal fees and expenses) arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in any registration statement, prospectus, or related document, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading (other than information provided in writing by the selling securityholder expressly for use therein), and (ii) the Pinnacle Vista Holders have agreed severally, and not jointly, to indemnify and hold harmless the Company and its respective officers, directors, agents, and representatives against certain losses, claims, damages, or liabilities arising out of or based upon any untrue statement or alleged untrue statement of a material fact, or any omission or alleged omission to state a material fact, in each case to the extent that such untrue statement or omission was made in reliance upon and in conformity with information provided in writing by the selling securityholder expressly for use in such registration statement, prospectus, or related document.
Registrable Securities.  For purposes of the Registration Rights Agreement, "registrable securities" includes all shares of common stock held by the Pinnacle Vista Holders and their permitted transferees, as well as any shares of common stock issued or issuable with respect to such shares by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, reclassification, merger, consolidation, or similar reorganization. Shares will cease to be "registrable securities" upon the earliest of (i) the date on which such shares have been sold pursuant to an effective registration statement under the Securities Act, (ii) the date on which such shares have been sold in a transaction exempt from the registration and prospectus-delivery requirements of the Securities Act (including pursuant to Rule 144) such that all transfer restrictions and restrictive legends with respect thereto are removed, (iii) the date on which such shares become eligible for resale under Rule 144 without volume or manner-of-sale limitations and without the requirement for current public information, and (iv) the date on which the holder of such shares (together with its affiliates, partners, members, and former members) holds registrable securities representing less than 1% of the outstanding common stock of the Company.
Equity Compensation Plans — Form S-8 Registration
2022 Omnibus Equity Incentive Plan
We intend to file a registration statement on Form S-8 under the Securities Act promptly following the completion of this offering to register the shares of common stock reserved for issuance under our 2022 Omnibus Equity Incentive Plan (the "2022 Plan"). We have reserved 12,727,273 shares of common stock for issuance under the 2022 Plan, representing approximately 10% of the 127,272,727 shares of common stock expected to be outstanding immediately following the completion of this offering, assuming full exercise of the underwriters' overallotment option.
The 2022 Plan provides for the grant of stock options (including incentive stock options and non-qualified stock options), restricted stock awards, restricted stock units ("RSUs"), performance stock units ("PSUs"), stock appreciation rights, and other equity-based awards to our employees, directors, officers, consultants, and advisors. The 2022 Plan also includes an "evergreen" provision pursuant to which the number of shares of common stock reserved for issuance under the 2022 Plan will automatically increase on the first day of each fiscal year beginning with the fiscal year commencing January 1, 2024, by a number of shares equal to the lesser of (i) 2% of the total number of shares of common stock outstanding on the last day of the immediately preceding fiscal year and (ii) a number of shares determined by our board of directors. For a complete description of the terms of the 2022 Plan, see "Executive Compensation — 2022 Omnibus Equity Incentive Plan."
Upon the registration statement on Form S-8 becoming effective, shares of common stock issued under the 2022 Plan (other than shares held by affiliates of the Company, which will remain subject to the volume and manner-of-sale limitations of Rule 144) will be available for sale in the public market, subject to any applicable lock-up restrictions described above and the satisfaction of any applicable vesting conditions. We expect the registration statement on Form S-8 to become effective promptly following the completion of this offering, subject to processing times at the SEC.
2022 Employee Stock Purchase Plan
We also intend to file a registration statement on Form S-8 under the Securities Act to register shares of common stock reserved for issuance under our 2022 Employee Stock Purchase Plan (the "ESPP"). We have reserved 2,545,455 shares of common stock for issuance under the ESPP, representing approximately 2% of the 127,272,727 shares of common stock expected to be outstanding immediately following the completion of this offering, assuming full exercise of the underwriters' overallotment option.
The ESPP is intended to qualify as an "employee stock purchase plan" under Section 423 of the Internal Revenue Code of 1986, as amended (the "Code"). Under the ESPP, eligible employees may purchase shares of our common stock at a price equal to 85% of the lower of (i) the fair market value of the common stock on the first day of the applicable offering period and (ii) the fair market value of the common stock on the last day (i.e., the purchase date) of the applicable offering period. Offering periods under the ESPP are six months in duration, commencing on each January 1 and July 1 (or such other dates as determined by our board of directors or compensation committee). For a complete description of the terms of the ESPP, see "Executive Compensation — 2022 Employee Stock Purchase Plan."
Shares of common stock purchased by participants under the ESPP and registered on Form S-8 generally will be available for sale in the public market immediately upon purchase, subject to any applicable lock-up restrictions described above. Shares held by affiliates of the Company that are purchased under the ESPP will remain subject to the volume and manner-of-sale limitations of Rule 144.
IPO Equity Grants
In connection with this offering, we expect to grant RSU awards under the 2022 Plan to certain of our executive officers and other key employees. The following table sets forth the RSU grants expected to be made to our named executive officers in connection with the IPO:
Each of the RSU awards described above is subject to four-year ratable vesting, with 25% of the RSUs vesting on each of the first four anniversaries of the grant date, subject to the executive officer's continued service with the Company through each applicable vesting date. Shares of common stock issued upon the vesting and settlement of these RSU awards will be registered on Form S-8 and will generally be available for sale in the public market upon issuance, subject to (i) the 180-day lock-up restrictions described above and (ii) for affiliates of the Company, the volume, manner-of-sale, notice, and current public-information limitations of Rule 144.
Stockholders' Agreement
We have entered into an Amended and Restated Stockholders' Agreement, dated as of the closing date of this offering (the "Stockholders' Agreement"), among the Company, Pinnacle Vista Capital Partners III, LP, Garrett Calloway, and Elaine Briggs (collectively, with their respective permitted transferees, the "Stockholder Parties"). The Stockholders' Agreement will become effective upon the closing of this offering and will supersede all prior agreements among the Stockholder Parties with respect to the matters addressed therein.
The Stockholders' Agreement contains certain transfer restrictions on shares of common stock held by the Stockholder Parties, including, without limitation:
•  Rights of First Refusal. Prior to any proposed sale or transfer of shares by a Stockholder Party (other than sales in the public market pursuant to an effective registration statement or in compliance with Rule 144, and other than certain permitted transfers), the transferring Stockholder Party must first offer such shares to the Company and then to the other Stockholder Parties on the same terms and conditions as the proposed sale.
•  Tag-Along Rights. In the event that Pinnacle Vista proposes to sell or transfer shares of common stock to a third party (other than in a public market transaction or a permitted transfer), the Founders have the right to participate in such sale or transfer on a pro rata basis and on the same terms and conditions as Pinnacle Vista.
•  Standstill Provisions. Pinnacle Vista has agreed, subject to certain exceptions, not to acquire additional shares of common stock or other equity securities of the Company without the prior approval of the board of directors (excluding any Pinnacle Vista designees serving on the board).
The transfer restrictions set forth in the Stockholders' Agreement are in addition to, and not in lieu of, the lock-up restrictions described above and the limitations on resale imposed by Rule 144 under the Securities Act. To the extent that the lock-up restrictions, Rule 144 limitations, and the Stockholders' Agreement transfer restrictions apply concurrently, the most restrictive provision will control. For a more complete description of the terms and conditions of the Stockholders' Agreement, see "Certain Relationships and Related-Party Transactions — Stockholders' Agreement."
Controlled-Company and Affiliate Status Considerations
Following the completion of this offering, Pinnacle Vista Capital Partners III, LP is expected to beneficially own approximately 55,181,818 shares of our common stock, representing approximately 44.6% of our outstanding common stock (assuming the base offering with no exercise of the underwriters' overallotment option), or approximately 43.4% of our outstanding common stock (assuming full exercise of the underwriters' overallotment option). In each case, the foregoing percentages are calculated based on the number of shares outstanding immediately following the completion of this offering and give effect to the sale of 6,818,182 shares by Pinnacle Vista in the secondary offering component of this offering.
Together with shares held by the Founders, Garrett Calloway and Elaine Briggs, that are subject to the voting and other provisions of the Stockholders' Agreement, Pinnacle Vista may be deemed to control the Company for purposes of the Securities Act and the Exchange Act. As a result, Pinnacle Vista and each of the Founders may be deemed "affiliates" of the Company under Rule 144, and their resales of shares of common stock following the offering will be subject to the volume, manner-of-sale, notice, and current public information limitations of Rule 144, in addition to the 180-day lock-up restrictions described above and the transfer restrictions set forth in the Stockholders' Agreement. For so long as Pinnacle Vista and the Founders are deemed affiliates of the Company, they will not be able to sell shares of common stock in the public market without complying with Rule 144 or pursuant to an effective registration statement under the Securities Act.
In addition, for so long as Pinnacle Vista (together with its affiliates) beneficially owns more than 50% of the voting power of our outstanding common stock, we intend to rely on the "controlled company" exemption under the listing standards of the New York Stock Exchange, which permits us to elect not to comply with certain corporate governance requirements. If at any time following this offering Pinnacle Vista's beneficial ownership falls below 50% of the voting power of our outstanding common stock, we will no longer qualify for the controlled-company exemption and will be required to comply with the applicable NYSE corporate governance requirements within the transition periods specified by the NYSE listing standards. For a description of the controlled-company exemption and the corporate governance requirements from which we may be exempt, see "Management and Board of Directors — Controlled-Company Exemption" and "Risk Factors — Risks Relating to This Offering and Ownership of Our Common Stock — We are a controlled company within the meaning of the NYSE listing standards and, as a result, qualify for exemptions from certain corporate governance requirements."
Effect of Sales on Market Price
Sales of substantial numbers of shares of our common stock in the public market after this offering, or the perception that such sales could occur (including in anticipation of or upon the expiration of the 180-day lock-up period), could adversely affect the prevailing market price of our common stock and could materially impair our future ability to raise capital through equity offerings at times and prices that we deem appropriate. In particular:
•  Approximately 76,286,364 restricted shares of our common stock (based on the base offering, assuming no exercise of the underwriters' overallotment option) will become eligible for sale in the public market upon the expiration of the 180-day lock-up period, subject to the volume, manner-of-sale, and other limitations of Rule 144 for affiliates. These shares represent approximately 61.7% of the total number of shares of common stock expected to be outstanding immediately following the completion of this offering.
•  Additional shares of common stock may be registered for resale under the Securities Act pursuant to the Registration Rights Agreement described above, including by means of demand registrations, piggyback registrations, or a shelf registration statement on Form S-3.
•  Shares of common stock issued under the 2022 Omnibus Equity Incentive Plan and the 2022 Employee Stock Purchase Plan and registered on Form S-8 will become eligible for sale in the public market upon issuance (subject to applicable lock-up restrictions and vesting conditions and, for affiliates, Rule 144 limitations). As additional shares vest and are settled under outstanding equity awards, the number of shares eligible for public sale will increase.
The release of a substantial number of shares into the public market at any time, whether upon the expiration of the lock-up period, the effectiveness of a registration statement covering registrable securities held by Pinnacle Vista, or otherwise, could cause the market price of our common stock to decline significantly. Moreover, the mere perception that such sales could occur may itself adversely affect the market price of our common stock, regardless of whether any such sales have actually occurred or are currently anticipated. We cannot predict the effect that future sales of our common stock in the public market, or the availability of shares for future sale, will have on the market price of our common stock.
Category | Number of Shares | Notes
Shares sold in this offering (base offering, no overallotment exercise) | 23,713,636 | Freely tradable immediately upon completion of this offering (except shares purchased by affiliates, which will be subject to Rule 144 limitations)
Additional shares issuable upon full exercise of the underwriters' overallotment option | 3,559,091 | Freely tradable immediately upon issuance (except shares purchased by affiliates, which will be subject to Rule 144 limitations)
Restricted shares held by pre-IPO stockholders (subject to lock-up) | ~76,286,364 (base offering) | Eligible for sale upon expiration of the 180-day lock-up period, subject to the volume and manner-of-sale limitations of Rule 144 for affiliates
Shares reserved for issuance under the 2022 Omnibus Equity Incentive Plan | 12,727,273 | Representing approximately 10% of the 127,272,727 shares expected to be outstanding assuming full exercise of the overallotment option; to be registered on Form S-8; subject to Rule 701 and, for affiliates, Rule 144 limitations
Shares reserved for issuance under the 2022 Employee Stock Purchase Plan | 2,545,455 | Representing approximately 2% of the 127,272,727 shares expected to be outstanding assuming full exercise of the overallotment option; to be registered on Form S-8
Named Executive Officer | Title | RSUs to be Granted | Vesting Schedule
Garrett Calloway | Chief Executive Officer and Chairman | 500,000 | Four-year ratable vesting (25% per year)
Elaine Briggs | President | 400,000 | Four-year ratable vesting (25% per year)
Marcus Yoon | Chief Financial Officer | 300,000 | Four-year ratable vesting (25% per year)
Sandra Haverford | Chief Operating Officer | 200,000 | Four-year ratable vesting (25% per year)
Dale Renfroe | General Counsel and Corporate Secretary | 175,000 | Four-year ratable vesting (25% per year)
Priya Anand | Chief Technology Officer | 175,000 | Four-year ratable vesting (25% per year)
Tomás Quintero | SVP, Project Development | 150,000 | Four-year ratable vesting (25% per year)
Rachel Whitmore | SVP, Corporate Strategy | 150,000 | Four-year ratable vesting (25% per year)

CONFIDENTIAL TREATMENT REQUESTED — DRAFT — NOT FOR DISTRIBUTION

SHARES ELIGIBLE FOR FUTURE SALE

Record

Parties

Dates

Amounts