1015-00004 · Calloway-Briggs Renewables Inc · Engagement

engagement-letter-cbr.docx DOCUMENT M&A / Corporate

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CALDERWOOD & HARKNESS LLP Attorneys at Law

1000 Louisiana Street, Suite 5500 Houston, Texas 77002

Telephone: (713) 555-8400 Facsimile: (713) 555-8401 www.calderwoodharkness.com

September 12, 2023

VIA HAND DELIVERY AND ELECTRONIC MAIL

Margaret "Meg" Calloway Co-Founder, Chairwoman & Chief Executive Officer Calloway-Briggs Renewables Inc. 2300 Travis Street, Suite 4200 Houston, Texas 77006

Re: Engagement of Calderwood & Harkness LLP by Calloway-Briggs Renewables Inc. — Formation of Joint Venture with Lumen Ridge Infrastructure Partners LLC Matter No. 48172.001

Dear Ms. Calloway:

Thank you for selecting Calderwood & Harkness LLP to serve as legal counsel to Calloway-Briggs Renewables Inc. in connection with the proposed joint venture transaction described below. We are pleased to accept this engagement and look forward to working with you and your team. The purpose of this letter is to set forth the terms and conditions under which the Firm will provide legal services in this matter. We ask that you review this letter carefully and, if the terms are acceptable, execute and return a copy to us as indicated below.

Throughout this letter, Calderwood & Harkness LLP is referred to as "the Firm," "we," "our," or "C&H," and Calloway-Briggs Renewables Inc. is referred to as "CBR" or "the Company."

1. Engagement and Scope of Representation

This letter confirms that Calderwood & Harkness LLP has been retained by Calloway-Briggs Renewables Inc. to serve as outside legal counsel to the Company in connection with the formation of a 50/50 joint venture (the "Joint Venture" or the "JV") between CBR and Lumen Ridge Infrastructure Partners LLC, a Delaware limited liability company headquartered in Stamford, Connecticut ("Lumen Ridge"). The Joint Venture will be structured as a Delaware limited liability company (the "JV Entity") for the purpose of co-developing, constructing, owning, and operating a portfolio of utility-scale solar photovoltaic projects located across Texas and the Desert Southwest region of the United States (collectively, the "Projects"), with an aggregate nameplate generation capacity of approximately 1.2 gigawatts (GW).

Based on our initial discussions with CBR's management team, total aggregate equity commitments to the JV Entity are anticipated to be approximately Three Hundred Million Dollars ($300,000,000), with each of CBR and Lumen Ridge expected to commit approximately One Hundred Fifty Million Dollars ($150,000,000). CBR's capital contribution to the JV Entity is expected to include a combination of cash and the contribution of an existing pipeline of solar development projects currently held by the Company or its subsidiaries (the "Contributed Projects"), the terms of which will be set forth in a contribution agreement to be negotiated between the parties. The Firm's internal matter number for this engagement is 48172.001, and we ask that this number be referenced on all correspondence, invoices, and communications related to this matter.

The scope of the Firm's representation of CBR in this engagement shall include, but not be limited to, the following:

(a) JV LLC Agreement. The negotiation, drafting, and finalization of the limited liability company agreement (the "LLC Agreement") governing the formation, governance, capitalization, management, operations, distributions, transfer restrictions, and dissolution of the JV Entity, including all schedules and exhibits thereto.

(b) Contribution Agreement. The drafting and negotiation of a contribution agreement (the "Contribution Agreement") pursuant to which CBR will contribute the Contributed Projects and associated development-stage assets to the JV Entity, including the establishment of agreed-upon valuations, representations and warranties, indemnification provisions, and closing conditions.

(c) Ancillary Transaction Documents. The drafting and negotiation of ancillary transaction documents, including without limitation: (i) a development and construction management agreement governing CBR's role as development manager for the Projects; (ii) a tax protection agreement for the benefit of CBR in connection with the contributed assets; (iii) an escrow agreement in connection with any post-closing adjustment or indemnification escrow; and (iv) such other ancillary agreements as the parties may determine to be necessary or appropriate in connection with the consummation of the transaction.

(d) Tax Structuring. Analysis of federal income tax structuring matters related to the JV Entity and the transactions contemplated hereby, including but not limited to: (i) ensuring that the JV Entity will be classified as a partnership for federal income tax purposes; (ii) analysis and selection of appropriate allocation methods under Section 704(c) of the Internal Revenue Code of 1986, as amended, with respect to the Contributed Projects; (iii) structuring of Investment Tax Credits, Production Tax Credits, and any applicable tax credit transfer or direct-pay elections under the Inflation Reduction Act of 2022; and (iv) general tax due diligence in connection with the transaction.

(e) HSR Act Analysis and Filing. Analysis of whether the proposed transaction requires a pre-merger notification filing under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), and, if so, preparation and submission of the HSR filing on behalf of CBR and coordination with the Federal Trade Commission or the Antitrust Division of the U.S. Department of Justice, as applicable.

(f) Coordination with Financial and Other Advisors. Coordination with CBR's financial advisor, Ridgeline Barrow & Co., and with such other third-party advisors — including accountants, environmental consultants, engineers, and appraisers — as may be engaged by CBR in connection with the transaction.

(g) Due Diligence. Legal due diligence review of real property matters (including title, survey, and land use matters), environmental matters (including review of Phase I and Phase II environmental site assessments), permitting and regulatory matters, and existing contractual arrangements related to the Contributed Projects and the broader project portfolio.

(h) Formation Documents. Preparation and filing of the Certificate of Formation (or equivalent organizational document) for the JV Entity with the Secretary of State of the State of Delaware, and preparation of such other organizational documents and resolutions as may be required in connection with the formation of the JV Entity.

(i) Legal Opinion. Preparation and delivery, on behalf of CBR, of a legal opinion (the "Closing Opinion") at the closing of the transaction, addressing such matters as are customary for transactions of this nature and as may be required under the LLC Agreement or other transaction documents.

(j) Project-Level Financing Review. Review and analysis of project-level financing documentation to the extent relevant to the structuring and consummation of the joint venture, including review of existing credit agreements, loan documents, tax equity structures, and intercreditor arrangements associated with the Contributed Projects.

(k) Third-Party Consents. Analysis of any required third-party consents, approvals, or waivers, including but not limited to consents required under CBR's existing stockholders' agreement, change-of-control provisions in project-level contracts, and any consents required from governmental authorities or utility off-takers.

(l) General Transactional Counsel. General corporate counsel and legal advice in connection with the transaction through the closing, including attendance at negotiation sessions, preparation of closing checklists, and coordination of the closing process.

The foregoing description of scope is intended to be illustrative and not exhaustive. We anticipate that additional matters may arise in the course of the transaction that fall within the general scope of this engagement, and we will consult with you regarding the scope and direction of our work as the engagement progresses. Any material expansion of the scope of our representation beyond that described above will be discussed with you in advance and, where appropriate, confirmed in a supplemental engagement letter.

2. Engagement Team

The Firm has assembled a team of experienced attorneys to serve CBR in connection with this engagement. The following professionals will comprise the core engagement team:

Responsible Partner: James Prentice, Partner, Mergers & Acquisitions Practice Group, Houston office. Mr. Prentice will have overall supervisory responsibility for the engagement and will serve as CBR's primary point of contact on all substantive legal matters. Mr. Prentice has extensive experience in complex joint venture formations, M&A transactions, and project development matters in the energy sector.

Billing Partner: Sandra Tung, Partner, Mergers & Acquisitions Practice Group, Houston office. Ms. Tung will be responsible for billing, invoicing, and administrative matters related to the engagement, including oversight of budget tracking and compliance with the fee arrangements described in Section 4 below.

Lead Associate: Megan Chu, Associate, Mergers & Acquisitions Practice Group, Houston office. Ms. Chu will serve as the lead associate on this matter and will be principally responsible for the day-to-day drafting, negotiation support, and due diligence coordination under the supervision of Mr. Prentice.

Working Associate: Derek Okonkwo, Associate, Mergers & Acquisitions Practice Group, Houston office. Mr. Okonkwo will support Ms. Chu on drafting, due diligence, and research tasks throughout the engagement.

Tax Specialist: Leonard Cross, Partner, Tax Practice Group, New York office. Mr. Cross will serve as the Firm's lead tax advisor on this engagement and will advise on all federal income tax structuring matters, including partnership tax classification, Section 704(c) allocation methodology, the structuring of tax credit arrangements under the Inflation Reduction Act, and the preparation of tax-related provisions in the LLC Agreement and Contribution Agreement.

Additional attorneys, paralegals, and professional staff may be assigned to the engagement from time to time as needed to ensure the efficient and timely delivery of legal services. We will notify CBR of any material changes to the composition of the core engagement team, including the assignment of any additional partners or the departure of any member of the team listed above.

3. Client Identification

It is important that we clearly identify the client in this engagement. The Firm's client in this engagement is Calloway-Briggs Renewables Inc. and Calloway-Briggs Renewables Inc. only. The Firm does not represent, and this engagement letter shall not be construed to create an attorney-client relationship with, any affiliate, subsidiary, parent entity, shareholder, member, officer, director, or employee of CBR in their individual capacity. Similarly, the Firm does not represent, and no attorney-client relationship exists or shall be deemed to exist with, any other party to the transaction, including but not limited to:

(i) Lumen Ridge Infrastructure Partners LLC;

(ii) Lumen Ridge Capital Advisors LLC;

(iii) Cascadia Growth Equity Fund III, L.P.;

(iv) the JV Entity to be formed; or

(v) any officer, director, member, general partner, limited partner, managing member, or other representative of any of the foregoing entities.

We understand that Lumen Ridge Infrastructure Partners LLC is separately represented in this transaction by Haverford, Quinn & Steele LLP, and we anticipate working cooperatively with Haverford Quinn's team in the negotiation and documentation of the transaction. However, at all times our duties of loyalty, confidentiality, and zealous representation run solely to CBR.

4. Fees and Billing Arrangements

4.1 Hourly Rates

Professional fees for legal services rendered in connection with this engagement will be charged on the basis of actual time expended at the Firm's standard hourly rates for the attorneys and professional staff assigned to this matter. The current standard hourly rates for the members of the engagement team are as follows:

The above rates are blended within each category (i.e., all partners are billed at the same rate and all associates are billed at the same rate), regardless of seniority or practice group. The Firm's standard hourly rates are subject to periodic adjustment, typically on an annual basis effective as of January 1 of each calendar year. CBR will receive advance written notice of not less than thirty (30) days prior to the effective date of any rate increase applicable to this engagement.

In addition to attorney time, paralegal and other professional staff time incurred in connection with this matter will be billed at the Firm's then-current standard rates for such personnel, which currently range from $350 to $475 per hour depending on the seniority and specialization of the individual.

4.2 Fee Estimate

Based on our understanding of the anticipated scope, complexity, and timeline of the engagement, the Firm estimates that total professional legal fees for this matter will range from One Million Eight Hundred Thousand Dollars ($1,800,000) to Two Million Two Hundred Thousand Dollars ($2,200,000). This estimate has been developed based on our experience with joint venture transactions of comparable size and complexity in the energy sector and reflects assumptions regarding, among other things, the anticipated duration of the negotiation period, the scope of due diligence, the number and complexity of ancillary documents, and the level of regulatory analysis required.

This estimate is provided solely for CBR's internal budgeting and planning purposes and does not constitute a cap, ceiling, or fixed fee for the engagement. Actual fees may be higher or lower than the estimated range depending on a number of factors, many of which are outside the Firm's control, including but not limited to: the complexity and pace of negotiations between CBR and Lumen Ridge; the scope and findings of due diligence; the number and nature of regulatory filings required; changes in the transaction structure; the volume and complexity of third-party consents; delays in the closing timeline; and any expansion of the scope of the engagement. We will endeavor to keep CBR informed of the status of fees incurred relative to this estimate and will promptly notify you if we anticipate that actual fees are likely to materially exceed the estimated range.

4.3 Fee Holdback Arrangement

In recognition of the transaction-contingent nature of certain aspects of this engagement and as a reflection of the Firm's commitment to CBR's business relationship, the parties have agreed to the following holdback arrangement with respect to professional fees (the "Holdback Arrangement"):

(a) Holdback Percentage. Fifty percent (50%) of all professional fees invoiced during the course of the engagement (the "Holdback Amount") shall be held back and shall not be due and payable until the occurrence of a Triggering Event (as defined below). The remaining fifty percent (50%) of all professional fees invoiced shall be due and payable in accordance with the standard payment terms set forth in Section 4.5 below.

(b) Payment Upon Successful Closing. Upon the successful closing of the Joint Venture transaction (a "Successful Closing"), the entire accrued Holdback Amount shall become immediately due and payable. CBR shall pay the full Holdback Amount within thirty (30) calendar days following the date of the Successful Closing.

(c) Payment Upon Transaction Termination. In the event that the Joint Venture transaction does not close for any reason — including but not limited to mutual termination by the parties, termination by either party for failure of a closing condition, termination due to a material adverse effect, regulatory disapproval, or abandonment of the transaction — the Holdback Amount shall nevertheless become due and payable. CBR shall pay the full Holdback Amount within sixty (60) calendar days following written notice from the Firm that the transaction has been terminated or abandoned (a "Termination Event" and, together with a Successful Closing, each a "Triggering Event").

(d) Clarification. For the avoidance of doubt, the Holdback Arrangement applies solely to professional fees and does not apply to disbursements and expenses, which shall be invoiced and payable in accordance with Sections 4.4 and 4.5 below without holdback.

4.4 Disbursements and Expenses

In addition to professional fees for legal services, CBR will be responsible for the reimbursement of all reasonable and customary out-of-pocket disbursements and expenses incurred by the Firm in connection with the engagement. Such disbursements and expenses include, but are not limited to, the following:

(i) filing fees, including fees associated with any HSR Act pre-merger notification filing, Delaware Secretary of State filing fees for the Certificate of Formation and other organizational documents, good standing certificate fees, and any other governmental filing fees;

(ii) travel expenses, including airfare, hotel accommodations, ground transportation, and meals, incurred by Firm personnel in connection with negotiations, due diligence site visits, or other engagement-related travel;

(iii) courier, messenger, and overnight delivery charges;

(iv) printing, photocopying, and document production costs, including costs associated with the reproduction of closing binders and signature pages;

(v) charges for computerized legal research databases, including Westmark Data Systems, Sundial Solutions, and specialized energy and regulatory databases;

(vi) charges for third-party vendors retained by the Firm at CBR's request or with CBR's prior approval, including title companies, process servers, and document management vendors; and

(vii) other incidental out-of-pocket costs reasonably incurred in connection with the performance of legal services under this engagement.

The Firm will endeavor to obtain CBR's prior approval before incurring any single disbursement or expense item in excess of Five Thousand Dollars ($5,000). Disbursements and expenses are not subject to the Holdback Arrangement described in Section 4.3 and shall be invoiced and payable in full in accordance with Section 4.5.

4.5 Invoicing and Payment Terms

The Firm will issue itemized invoices on a monthly basis for professional fees earned and disbursements incurred during the preceding calendar month. Each invoice will contain a reasonably detailed description of the services rendered, the attorney or professional responsible for each time entry, the hours expended, and the applicable rate. All invoices will reference Matter Number 48172.001.

Invoices are due and payable within thirty (30) calendar days of the date of the invoice, subject to the fifty percent (50%) holdback of professional fees described in Section 4.3 above. For the avoidance of doubt, the non-holdback portion of each invoice (i.e., 50% of professional fees, plus 100% of disbursements and expenses) is due and payable within thirty (30) days of the invoice date.

All invoices should be directed to:

Priya Narayanan Chief Financial Officer Calloway-Briggs Renewables Inc. 2300 Travis Street, Suite 4200 Houston, Texas 77006

Email: pnarayanan@calloway-briggs.com

Any questions or disputes regarding an invoice should be communicated to Sandra Tung within fifteen (15) days of receipt of the invoice. The Firm and CBR will work in good faith to resolve any billing questions promptly.

Late payments on any amounts due and payable under this engagement letter shall accrue interest at a rate of one percent (1.0%) per month (twelve percent (12.0%) per annum), calculated from the date payment was due until the date payment is received by the Firm.

5. Conflicts of Interest

In accordance with the Firm's standard procedures and applicable rules of professional conduct, the Firm has conducted a comprehensive conflicts check with respect to the parties involved in this engagement, including Calloway-Briggs Renewables Inc., Lumen Ridge Infrastructure Partners LLC, Lumen Ridge Capital Advisors LLC, Cascadia Growth Equity Fund III, L.P., and the known principals and senior officers of each such entity. Based on the results of that conflicts check, the Firm has determined that no disqualifying conflicts of interest exist under applicable rules of professional conduct, and the Firm is able to undertake this engagement.

CBR acknowledges and agrees that the Firm is a large, multi-office law firm with a diverse client base that includes clients in the energy, infrastructure, and financial services sectors. The Firm may currently represent, or may in the future represent, other clients in matters that are unrelated to this engagement but that may involve parties adverse to one or more of the parties involved in this transaction. CBR's engagement of the Firm in connection with this matter does not preclude the Firm from accepting engagements from other clients in matters that are not substantially related to this engagement, even if such matters are adverse to CBR, Lumen Ridge, or any other party to the transaction, provided that such matters do not involve the use of CBR's confidential information.

In the event that an actual or potential conflict of interest arises during the course of this engagement that the Firm believes may affect its ability to continue the representation, the Firm will promptly notify CBR of the nature of the conflict and consult with CBR regarding appropriate steps to address the situation. Such steps may include, depending on the circumstances, seeking an informed written waiver of the conflict from the affected parties or, if the conflict cannot be adequately addressed through a waiver, withdrawal from the representation in accordance with Section 9 of this letter.

6. Confidentiality

The Firm will maintain the confidentiality of all information provided by or on behalf of CBR in connection with this engagement, in strict accordance with the applicable Texas Disciplinary Rules of Professional Conduct, the New York Rules of Professional Conduct, and the Firm's internal information security policies and procedures. All documents, communications, financial data, business plans, trade secrets, technical information, and other materials furnished by CBR to the Firm, or developed by the Firm in the course of this engagement, will be treated as confidential and will not be disclosed to any third party without CBR's prior written consent, except as may be required by applicable law, court order, or the rules of professional conduct.

Notwithstanding the foregoing, CBR acknowledges and agrees that confidential information may be shared, to the extent necessary to perform the legal services contemplated by this engagement, with: (a) other attorneys, paralegals, and professional staff within the Firm who are working on this matter or who are consulted in connection with specific issues arising in the engagement; (b) with CBR's express prior consent, third-party advisors engaged by CBR or by the Firm at CBR's direction, including Ridgeline Barrow & Co. and any environmental, engineering, or accounting consultants; and (c) as may otherwise be required to comply with applicable legal, regulatory, or ethical obligations.

7. Document Retention

Upon the conclusion of this engagement — whether by reason of the closing of the transaction, the termination or abandonment of the transaction, or the termination of this engagement by either party — the Firm will maintain the files, documents, and work product related to this matter in accordance with the Firm's standard document retention policies. The Firm's current policy provides for the retention of closed matter files for a period of ten (10) years following the conclusion of the engagement.

CBR may request the return or transfer of any original documents provided to the Firm at any time during or after the engagement. Upon such request, the Firm will return originals promptly and may retain copies for its files. At the expiration of the ten (10) year retention period, the Firm reserves the right to destroy or dispose of all files and documents related to this matter, including both paper and electronic records, without further notice to CBR; provided, however, that the Firm will make commercially reasonable efforts to provide CBR with at least sixty (60) days' advance written notice before disposing of any files, to afford CBR the opportunity to request the return of any materials.

8. Limitation of Engagement

The Firm's engagement under this letter is strictly limited to the specific scope of representation described in Section 1 above. Unless separately agreed in a written supplement to this engagement letter or in a separate engagement letter, the Firm is not being engaged to provide legal advice or services with respect to any matters outside the described scope, including but not limited to the following:

(a) proceedings before any state public utility commission, including applications for certificates of convenience and necessity or other regulatory approvals;

(b) proceedings before the Federal Energy Regulatory Commission ("FERC"), including applications for market-based rate authority or compliance filings;

(c) environmental permitting, except for legal review and analysis of third-party environmental reports and assessments provided to the Firm in connection with due diligence;

(d) the preparation or filing of federal, state, or local tax returns for CBR, the JV Entity, or any other entity;

(e) the negotiation or drafting of project-level power purchase agreements, interconnection agreements, or EPC contracts, except to the extent that review of such agreements is necessary in connection with due diligence on the Contributed Projects; and

(f) any litigation, arbitration, or dispute resolution proceedings involving CBR, the JV Entity, or any other party.

Should CBR require legal assistance with any of the foregoing matters or any other matters outside the scope of this engagement, we would be happy to discuss whether the Firm is in a position to provide such assistance under a separate engagement letter.

This engagement shall commence on the date of this letter and shall continue until the earliest to occur of: (a) the successful closing of the Joint Venture transaction; (b) the termination or abandonment of the transaction; or (c) the earlier termination of this engagement by either party as provided in Section 9 below.

9. Termination

Either party may terminate this engagement at any time upon written notice to the other party. In the event CBR terminates the engagement, such termination shall be effective upon the Firm's receipt of written notice from CBR. In the event the Firm seeks to terminate the engagement, the Firm will comply with all obligations under applicable rules of professional conduct, including taking reasonable steps to protect CBR's interests, providing reasonable notice of withdrawal, and returning papers and property to which CBR is entitled.

Upon termination of this engagement for any reason, CBR shall remain responsible for the payment of: (a) all professional fees for services rendered through the effective date of termination, including any accrued and unpaid Holdback Amount as described in Section 4.3 (which shall become due and payable within sixty (60) days following the effective date of termination); and (b) all disbursements and expenses incurred through the effective date of termination. The Firm's obligation to maintain the confidentiality of CBR's information and the provisions of Section 7 (Document Retention) shall survive the termination of this engagement.

10. Governing Law

This engagement letter shall be governed by and construed in accordance with the laws of the State of New York, without regard to its conflict-of-laws principles. Any dispute arising out of or relating to this engagement letter or the Firm's representation of CBR hereunder shall be resolved in the state or federal courts located in the County of New York, State of New York, and each party hereby consents to the exclusive jurisdiction and venue of such courts for purposes of any such dispute.

11. Entire Agreement; Amendments

This letter constitutes the entire agreement between the Firm and CBR with respect to the engagement described herein and supersedes all prior and contemporaneous discussions, negotiations, understandings, and agreements, whether oral or written, relating to the subject matter hereof. No modification, amendment, supplement, or waiver of any provision of this engagement letter shall be effective unless set forth in a writing signed by an authorized representative of each of the Firm and CBR.

12. Acceptance and Execution

If the foregoing terms and conditions are acceptable, please indicate CBR's agreement by signing and dating a copy of this letter in the space provided below and returning it to the undersigned. We suggest retaining a copy for your records. Upon execution by both parties, this letter shall constitute a binding agreement between the Firm and CBR. If you have any questions or wish to discuss any aspect of this engagement letter, please do not hesitate to contact me directly at (713) 555-8412 or jprentice@calderwoodharkness.com.

We look forward to working with you and the CBR team on this important transaction.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Name: James Prentice

Title: Partner

Calderwood & Harkness LLP 1000 Louisiana Street, Suite 5500 Houston, Texas 77002

ACKNOWLEDGED AND AGREED:

CALLOWAY-BRIGGS RENEWABLES INC.

By: ________

Name: Margaret "Meg" Calloway

Title: Co-Founder, Chairwoman & Chief Executive Officer

Date: ________

2300 Travis Street, Suite 4200 Houston, Texas 77006

cc: Rebecca Whitfield, General Counsel, Calloway-Briggs Renewables Inc. cc: Sandra Tung, Partner, Calderwood & Harkness LLP cc: Megan Chu, Associate, Calderwood & Harkness LLP

Category	Rate
Partners (James Prentice, Sandra Tung, Leonard Cross)	$1,150 per hour
Associates (Megan Chu, Derek Okonkwo)	$725 per hour

CALDERWOOD & HARKNESS LLP Attorneys at Law
1000 Louisiana Street, Suite 5500 Houston, Texas 77002
Telephone: (713) 555-8400 Facsimile: (713) 555-8401 www.calderwoodharkness.com
September 12, 2023
VIA HAND DELIVERY AND ELECTRONIC MAIL
Margaret "Meg" Calloway Co-Founder, Chairwoman & Chief Executive Officer Calloway-Briggs Renewables Inc. 2300 Travis Street, Suite 4200 Houston, Texas 77006
Re: Engagement of Calderwood & Harkness LLP by Calloway-Briggs Renewables Inc. — Formation of Joint Venture with Lumen Ridge Infrastructure Partners LLC Matter No. 48172.001
Dear Ms. Calloway:
Thank you for selecting Calderwood & Harkness LLP to serve as legal counsel to Calloway-Briggs Renewables Inc. in connection with the proposed joint venture transaction described below. We are pleased to accept this engagement and look forward to working with you and your team. The purpose of this letter is to set forth the terms and conditions under which the Firm will provide legal services in this matter. We ask that you review this letter carefully and, if the terms are acceptable, execute and return a copy to us as indicated below.
Throughout this letter, Calderwood & Harkness LLP is referred to as "the Firm," "we," "our," or "C&H," and Calloway-Briggs Renewables Inc. is referred to as "CBR" or "the Company."
1. Engagement and Scope of Representation
This letter confirms that Calderwood & Harkness LLP has been retained by Calloway-Briggs Renewables Inc. to serve as outside legal counsel to the Company in connection with the formation of a 50/50 joint venture (the "Joint Venture" or the "JV") between CBR and Lumen Ridge Infrastructure Partners LLC, a Delaware limited liability company headquartered in Stamford, Connecticut ("Lumen Ridge"). The Joint Venture will be structured as a Delaware limited liability company (the "JV Entity") for the purpose of co-developing, constructing, owning, and operating a portfolio of utility-scale solar photovoltaic projects located across Texas and the Desert Southwest region of the United States (collectively, the "Projects"), with an aggregate nameplate generation capacity of approximately 1.2 gigawatts (GW).
Based on our initial discussions with CBR's management team, total aggregate equity commitments to the JV Entity are anticipated to be approximately Three Hundred Million Dollars ($300,000,000), with each of CBR and Lumen Ridge expected to commit approximately One Hundred Fifty Million Dollars ($150,000,000). CBR's capital contribution to the JV Entity is expected to include a combination of cash and the contribution of an existing pipeline of solar development projects currently held by the Company or its subsidiaries (the "Contributed Projects"), the terms of which will be set forth in a contribution agreement to be negotiated between the parties. The Firm's internal matter number for this engagement is 48172.001, and we ask that this number be referenced on all correspondence, invoices, and communications related to this matter.
The scope of the Firm's representation of CBR in this engagement shall include, but not be limited to, the following:
(a) JV LLC Agreement. The negotiation, drafting, and finalization of the limited liability company agreement (the "LLC Agreement") governing the formation, governance, capitalization, management, operations, distributions, transfer restrictions, and dissolution of the JV Entity, including all schedules and exhibits thereto.
(b) Contribution Agreement. The drafting and negotiation of a contribution agreement (the "Contribution Agreement") pursuant to which CBR will contribute the Contributed Projects and associated development-stage assets to the JV Entity, including the establishment of agreed-upon valuations, representations and warranties, indemnification provisions, and closing conditions.
(c) Ancillary Transaction Documents. The drafting and negotiation of ancillary transaction documents, including without limitation: (i) a development and construction management agreement governing CBR's role as development manager for the Projects; (ii) a tax protection agreement for the benefit of CBR in connection with the contributed assets; (iii) an escrow agreement in connection with any post-closing adjustment or indemnification escrow; and (iv) such other ancillary agreements as the parties may determine to be necessary or appropriate in connection with the consummation of the transaction.
(d) Tax Structuring. Analysis of federal income tax structuring matters related to the JV Entity and the transactions contemplated hereby, including but not limited to: (i) ensuring that the JV Entity will be classified as a partnership for federal income tax purposes; (ii) analysis and selection of appropriate allocation methods under Section 704(c) of the Internal Revenue Code of 1986, as amended, with respect to the Contributed Projects; (iii) structuring of Investment Tax Credits, Production Tax Credits, and any applicable tax credit transfer or direct-pay elections under the Inflation Reduction Act of 2022; and (iv) general tax due diligence in connection with the transaction.
(e) HSR Act Analysis and Filing. Analysis of whether the proposed transaction requires a pre-merger notification filing under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), and, if so, preparation and submission of the HSR filing on behalf of CBR and coordination with the Federal Trade Commission or the Antitrust Division of the U.S. Department of Justice, as applicable.
(f) Coordination with Financial and Other Advisors. Coordination with CBR's financial advisor, Ridgeline Barrow & Co., and with such other third-party advisors — including accountants, environmental consultants, engineers, and appraisers — as may be engaged by CBR in connection with the transaction.
(g) Due Diligence. Legal due diligence review of real property matters (including title, survey, and land use matters), environmental matters (including review of Phase I and Phase II environmental site assessments), permitting and regulatory matters, and existing contractual arrangements related to the Contributed Projects and the broader project portfolio.
(h) Formation Documents. Preparation and filing of the Certificate of Formation (or equivalent organizational document) for the JV Entity with the Secretary of State of the State of Delaware, and preparation of such other organizational documents and resolutions as may be required in connection with the formation of the JV Entity.
(i) Legal Opinion. Preparation and delivery, on behalf of CBR, of a legal opinion (the "Closing Opinion") at the closing of the transaction, addressing such matters as are customary for transactions of this nature and as may be required under the LLC Agreement or other transaction documents.
(j) Project-Level Financing Review. Review and analysis of project-level financing documentation to the extent relevant to the structuring and consummation of the joint venture, including review of existing credit agreements, loan documents, tax equity structures, and intercreditor arrangements associated with the Contributed Projects.
(k) Third-Party Consents. Analysis of any required third-party consents, approvals, or waivers, including but not limited to consents required under CBR's existing stockholders' agreement, change-of-control provisions in project-level contracts, and any consents required from governmental authorities or utility off-takers.
(l) General Transactional Counsel. General corporate counsel and legal advice in connection with the transaction through the closing, including attendance at negotiation sessions, preparation of closing checklists, and coordination of the closing process.
The foregoing description of scope is intended to be illustrative and not exhaustive. We anticipate that additional matters may arise in the course of the transaction that fall within the general scope of this engagement, and we will consult with you regarding the scope and direction of our work as the engagement progresses. Any material expansion of the scope of our representation beyond that described above will be discussed with you in advance and, where appropriate, confirmed in a supplemental engagement letter.
2. Engagement Team
The Firm has assembled a team of experienced attorneys to serve CBR in connection with this engagement. The following professionals will comprise the core engagement team:
Responsible Partner: James Prentice, Partner, Mergers & Acquisitions Practice Group, Houston office. Mr. Prentice will have overall supervisory responsibility for the engagement and will serve as CBR's primary point of contact on all substantive legal matters. Mr. Prentice has extensive experience in complex joint venture formations, M&A transactions, and project development matters in the energy sector.
Billing Partner: Sandra Tung, Partner, Mergers & Acquisitions Practice Group, Houston office. Ms. Tung will be responsible for billing, invoicing, and administrative matters related to the engagement, including oversight of budget tracking and compliance with the fee arrangements described in Section 4 below.
Lead Associate: Megan Chu, Associate, Mergers & Acquisitions Practice Group, Houston office. Ms. Chu will serve as the lead associate on this matter and will be principally responsible for the day-to-day drafting, negotiation support, and due diligence coordination under the supervision of Mr. Prentice.
Working Associate: Derek Okonkwo, Associate, Mergers & Acquisitions Practice Group, Houston office. Mr. Okonkwo will support Ms. Chu on drafting, due diligence, and research tasks throughout the engagement.
Tax Specialist: Leonard Cross, Partner, Tax Practice Group, New York office. Mr. Cross will serve as the Firm's lead tax advisor on this engagement and will advise on all federal income tax structuring matters, including partnership tax classification, Section 704(c) allocation methodology, the structuring of tax credit arrangements under the Inflation Reduction Act, and the preparation of tax-related provisions in the LLC Agreement and Contribution Agreement.
Additional attorneys, paralegals, and professional staff may be assigned to the engagement from time to time as needed to ensure the efficient and timely delivery of legal services. We will notify CBR of any material changes to the composition of the core engagement team, including the assignment of any additional partners or the departure of any member of the team listed above.
3. Client Identification
It is important that we clearly identify the client in this engagement. The Firm's client in this engagement is Calloway-Briggs Renewables Inc. and Calloway-Briggs Renewables Inc. only. The Firm does not represent, and this engagement letter shall not be construed to create an attorney-client relationship with, any affiliate, subsidiary, parent entity, shareholder, member, officer, director, or employee of CBR in their individual capacity. Similarly, the Firm does not represent, and no attorney-client relationship exists or shall be deemed to exist with, any other party to the transaction, including but not limited to:
(i) Lumen Ridge Infrastructure Partners LLC;
(ii) Lumen Ridge Capital Advisors LLC;
(iii) Cascadia Growth Equity Fund III, L.P.;
(iv) the JV Entity to be formed; or
(v) any officer, director, member, general partner, limited partner, managing member, or other representative of any of the foregoing entities.
We understand that Lumen Ridge Infrastructure Partners LLC is separately represented in this transaction by Haverford, Quinn & Steele LLP, and we anticipate working cooperatively with Haverford Quinn's team in the negotiation and documentation of the transaction. However, at all times our duties of loyalty, confidentiality, and zealous representation run solely to CBR.
4. Fees and Billing Arrangements
4.1 Hourly Rates
Professional fees for legal services rendered in connection with this engagement will be charged on the basis of actual time expended at the Firm's standard hourly rates for the attorneys and professional staff assigned to this matter. The current standard hourly rates for the members of the engagement team are as follows:
The above rates are blended within each category (i.e., all partners are billed at the same rate and all associates are billed at the same rate), regardless of seniority or practice group. The Firm's standard hourly rates are subject to periodic adjustment, typically on an annual basis effective as of January 1 of each calendar year. CBR will receive advance written notice of not less than thirty (30) days prior to the effective date of any rate increase applicable to this engagement.
In addition to attorney time, paralegal and other professional staff time incurred in connection with this matter will be billed at the Firm's then-current standard rates for such personnel, which currently range from $350 to $475 per hour depending on the seniority and specialization of the individual.
4.2 Fee Estimate
Based on our understanding of the anticipated scope, complexity, and timeline of the engagement, the Firm estimates that total professional legal fees for this matter will range from One Million Eight Hundred Thousand Dollars ($1,800,000) to Two Million Two Hundred Thousand Dollars ($2,200,000). This estimate has been developed based on our experience with joint venture transactions of comparable size and complexity in the energy sector and reflects assumptions regarding, among other things, the anticipated duration of the negotiation period, the scope of due diligence, the number and complexity of ancillary documents, and the level of regulatory analysis required.
This estimate is provided solely for CBR's internal budgeting and planning purposes and does not constitute a cap, ceiling, or fixed fee for the engagement. Actual fees may be higher or lower than the estimated range depending on a number of factors, many of which are outside the Firm's control, including but not limited to: the complexity and pace of negotiations between CBR and Lumen Ridge; the scope and findings of due diligence; the number and nature of regulatory filings required; changes in the transaction structure; the volume and complexity of third-party consents; delays in the closing timeline; and any expansion of the scope of the engagement. We will endeavor to keep CBR informed of the status of fees incurred relative to this estimate and will promptly notify you if we anticipate that actual fees are likely to materially exceed the estimated range.
4.3 Fee Holdback Arrangement
In recognition of the transaction-contingent nature of certain aspects of this engagement and as a reflection of the Firm's commitment to CBR's business relationship, the parties have agreed to the following holdback arrangement with respect to professional fees (the "Holdback Arrangement"):
(a) Holdback Percentage. Fifty percent (50%) of all professional fees invoiced during the course of the engagement (the "Holdback Amount") shall be held back and shall not be due and payable until the occurrence of a Triggering Event (as defined below). The remaining fifty percent (50%) of all professional fees invoiced shall be due and payable in accordance with the standard payment terms set forth in Section 4.5 below.
(b) Payment Upon Successful Closing. Upon the successful closing of the Joint Venture transaction (a "Successful Closing"), the entire accrued Holdback Amount shall become immediately due and payable. CBR shall pay the full Holdback Amount within thirty (30) calendar days following the date of the Successful Closing.
(c) Payment Upon Transaction Termination. In the event that the Joint Venture transaction does not close for any reason — including but not limited to mutual termination by the parties, termination by either party for failure of a closing condition, termination due to a material adverse effect, regulatory disapproval, or abandonment of the transaction — the Holdback Amount shall nevertheless become due and payable. CBR shall pay the full Holdback Amount within sixty (60) calendar days following written notice from the Firm that the transaction has been terminated or abandoned (a "Termination Event" and, together with a Successful Closing, each a "Triggering Event").
(d) Clarification. For the avoidance of doubt, the Holdback Arrangement applies solely to professional fees and does not apply to disbursements and expenses, which shall be invoiced and payable in accordance with Sections 4.4 and 4.5 below without holdback.
4.4 Disbursements and Expenses
In addition to professional fees for legal services, CBR will be responsible for the reimbursement of all reasonable and customary out-of-pocket disbursements and expenses incurred by the Firm in connection with the engagement. Such disbursements and expenses include, but are not limited to, the following:
(i) filing fees, including fees associated with any HSR Act pre-merger notification filing, Delaware Secretary of State filing fees for the Certificate of Formation and other organizational documents, good standing certificate fees, and any other governmental filing fees;
(ii) travel expenses, including airfare, hotel accommodations, ground transportation, and meals, incurred by Firm personnel in connection with negotiations, due diligence site visits, or other engagement-related travel;
(iii) courier, messenger, and overnight delivery charges;
(iv) printing, photocopying, and document production costs, including costs associated with the reproduction of closing binders and signature pages;
(v) charges for computerized legal research databases, including Westmark Data Systems, Sundial Solutions, and specialized energy and regulatory databases;
(vi) charges for third-party vendors retained by the Firm at CBR's request or with CBR's prior approval, including title companies, process servers, and document management vendors; and
(vii) other incidental out-of-pocket costs reasonably incurred in connection with the performance of legal services under this engagement.
The Firm will endeavor to obtain CBR's prior approval before incurring any single disbursement or expense item in excess of Five Thousand Dollars ($5,000). Disbursements and expenses are not subject to the Holdback Arrangement described in Section 4.3 and shall be invoiced and payable in full in accordance with Section 4.5.
4.5 Invoicing and Payment Terms
The Firm will issue itemized invoices on a monthly basis for professional fees earned and disbursements incurred during the preceding calendar month. Each invoice will contain a reasonably detailed description of the services rendered, the attorney or professional responsible for each time entry, the hours expended, and the applicable rate. All invoices will reference Matter Number 48172.001.
Invoices are due and payable within thirty (30) calendar days of the date of the invoice, subject to the fifty percent (50%) holdback of professional fees described in Section 4.3 above. For the avoidance of doubt, the non-holdback portion of each invoice (i.e., 50% of professional fees, plus 100% of disbursements and expenses) is due and payable within thirty (30) days of the invoice date.
All invoices should be directed to:
Priya Narayanan Chief Financial Officer Calloway-Briggs Renewables Inc. 2300 Travis Street, Suite 4200 Houston, Texas 77006
Email: pnarayanan@calloway-briggs.com
Any questions or disputes regarding an invoice should be communicated to Sandra Tung within fifteen (15) days of receipt of the invoice. The Firm and CBR will work in good faith to resolve any billing questions promptly.
Late payments on any amounts due and payable under this engagement letter shall accrue interest at a rate of one percent (1.0%) per month (twelve percent (12.0%) per annum), calculated from the date payment was due until the date payment is received by the Firm.
5. Conflicts of Interest
In accordance with the Firm's standard procedures and applicable rules of professional conduct, the Firm has conducted a comprehensive conflicts check with respect to the parties involved in this engagement, including Calloway-Briggs Renewables Inc., Lumen Ridge Infrastructure Partners LLC, Lumen Ridge Capital Advisors LLC, Cascadia Growth Equity Fund III, L.P., and the known principals and senior officers of each such entity. Based on the results of that conflicts check, the Firm has determined that no disqualifying conflicts of interest exist under applicable rules of professional conduct, and the Firm is able to undertake this engagement.
CBR acknowledges and agrees that the Firm is a large, multi-office law firm with a diverse client base that includes clients in the energy, infrastructure, and financial services sectors. The Firm may currently represent, or may in the future represent, other clients in matters that are unrelated to this engagement but that may involve parties adverse to one or more of the parties involved in this transaction. CBR's engagement of the Firm in connection with this matter does not preclude the Firm from accepting engagements from other clients in matters that are not substantially related to this engagement, even if such matters are adverse to CBR, Lumen Ridge, or any other party to the transaction, provided that such matters do not involve the use of CBR's confidential information.
In the event that an actual or potential conflict of interest arises during the course of this engagement that the Firm believes may affect its ability to continue the representation, the Firm will promptly notify CBR of the nature of the conflict and consult with CBR regarding appropriate steps to address the situation. Such steps may include, depending on the circumstances, seeking an informed written waiver of the conflict from the affected parties or, if the conflict cannot be adequately addressed through a waiver, withdrawal from the representation in accordance with Section 9 of this letter.
6. Confidentiality
The Firm will maintain the confidentiality of all information provided by or on behalf of CBR in connection with this engagement, in strict accordance with the applicable Texas Disciplinary Rules of Professional Conduct, the New York Rules of Professional Conduct, and the Firm's internal information security policies and procedures. All documents, communications, financial data, business plans, trade secrets, technical information, and other materials furnished by CBR to the Firm, or developed by the Firm in the course of this engagement, will be treated as confidential and will not be disclosed to any third party without CBR's prior written consent, except as may be required by applicable law, court order, or the rules of professional conduct.
Notwithstanding the foregoing, CBR acknowledges and agrees that confidential information may be shared, to the extent necessary to perform the legal services contemplated by this engagement, with: (a) other attorneys, paralegals, and professional staff within the Firm who are working on this matter or who are consulted in connection with specific issues arising in the engagement; (b) with CBR's express prior consent, third-party advisors engaged by CBR or by the Firm at CBR's direction, including Ridgeline Barrow & Co. and any environmental, engineering, or accounting consultants; and (c) as may otherwise be required to comply with applicable legal, regulatory, or ethical obligations.
7. Document Retention
Upon the conclusion of this engagement — whether by reason of the closing of the transaction, the termination or abandonment of the transaction, or the termination of this engagement by either party — the Firm will maintain the files, documents, and work product related to this matter in accordance with the Firm's standard document retention policies. The Firm's current policy provides for the retention of closed matter files for a period of ten (10) years following the conclusion of the engagement.
CBR may request the return or transfer of any original documents provided to the Firm at any time during or after the engagement. Upon such request, the Firm will return originals promptly and may retain copies for its files. At the expiration of the ten (10) year retention period, the Firm reserves the right to destroy or dispose of all files and documents related to this matter, including both paper and electronic records, without further notice to CBR; provided, however, that the Firm will make commercially reasonable efforts to provide CBR with at least sixty (60) days' advance written notice before disposing of any files, to afford CBR the opportunity to request the return of any materials.
8. Limitation of Engagement
The Firm's engagement under this letter is strictly limited to the specific scope of representation described in Section 1 above. Unless separately agreed in a written supplement to this engagement letter or in a separate engagement letter, the Firm is not being engaged to provide legal advice or services with respect to any matters outside the described scope, including but not limited to the following:
(a) proceedings before any state public utility commission, including applications for certificates of convenience and necessity or other regulatory approvals;
(b) proceedings before the Federal Energy Regulatory Commission ("FERC"), including applications for market-based rate authority or compliance filings;
(c) environmental permitting, except for legal review and analysis of third-party environmental reports and assessments provided to the Firm in connection with due diligence;
(d) the preparation or filing of federal, state, or local tax returns for CBR, the JV Entity, or any other entity;
(e) the negotiation or drafting of project-level power purchase agreements, interconnection agreements, or EPC contracts, except to the extent that review of such agreements is necessary in connection with due diligence on the Contributed Projects; and
(f) any litigation, arbitration, or dispute resolution proceedings involving CBR, the JV Entity, or any other party.
Should CBR require legal assistance with any of the foregoing matters or any other matters outside the scope of this engagement, we would be happy to discuss whether the Firm is in a position to provide such assistance under a separate engagement letter.
This engagement shall commence on the date of this letter and shall continue until the earliest to occur of: (a) the successful closing of the Joint Venture transaction; (b) the termination or abandonment of the transaction; or (c) the earlier termination of this engagement by either party as provided in Section 9 below.
9. Termination
Either party may terminate this engagement at any time upon written notice to the other party. In the event CBR terminates the engagement, such termination shall be effective upon the Firm's receipt of written notice from CBR. In the event the Firm seeks to terminate the engagement, the Firm will comply with all obligations under applicable rules of professional conduct, including taking reasonable steps to protect CBR's interests, providing reasonable notice of withdrawal, and returning papers and property to which CBR is entitled.
Upon termination of this engagement for any reason, CBR shall remain responsible for the payment of: (a) all professional fees for services rendered through the effective date of termination, including any accrued and unpaid Holdback Amount as described in Section 4.3 (which shall become due and payable within sixty (60) days following the effective date of termination); and (b) all disbursements and expenses incurred through the effective date of termination. The Firm's obligation to maintain the confidentiality of CBR's information and the provisions of Section 7 (Document Retention) shall survive the termination of this engagement.
10. Governing Law
This engagement letter shall be governed by and construed in accordance with the laws of the State of New York, without regard to its conflict-of-laws principles. Any dispute arising out of or relating to this engagement letter or the Firm's representation of CBR hereunder shall be resolved in the state or federal courts located in the County of New York, State of New York, and each party hereby consents to the exclusive jurisdiction and venue of such courts for purposes of any such dispute.
11. Entire Agreement; Amendments
This letter constitutes the entire agreement between the Firm and CBR with respect to the engagement described herein and supersedes all prior and contemporaneous discussions, negotiations, understandings, and agreements, whether oral or written, relating to the subject matter hereof. No modification, amendment, supplement, or waiver of any provision of this engagement letter shall be effective unless set forth in a writing signed by an authorized representative of each of the Firm and CBR.
12. Acceptance and Execution
If the foregoing terms and conditions are acceptable, please indicate CBR's agreement by signing and dating a copy of this letter in the space provided below and returning it to the undersigned. We suggest retaining a copy for your records. Upon execution by both parties, this letter shall constitute a binding agreement between the Firm and CBR. If you have any questions or wish to discuss any aspect of this engagement letter, please do not hesitate to contact me directly at (713) 555-8412 or jprentice@calderwoodharkness.com.
We look forward to working with you and the CBR team on this important transaction.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Name: James Prentice
Title: Partner
Calderwood & Harkness LLP 1000 Louisiana Street, Suite 5500 Houston, Texas 77002
ACKNOWLEDGED AND AGREED:
CALLOWAY-BRIGGS RENEWABLES INC.
By: ________
Name: Margaret "Meg" Calloway
Title: Co-Founder, Chairwoman & Chief Executive Officer
Date: ________
2300 Travis Street, Suite 4200 Houston, Texas 77006
cc: Rebecca Whitfield, General Counsel, Calloway-Briggs Renewables Inc. cc: Sandra Tung, Partner, Calderwood & Harkness LLP cc: Megan Chu, Associate, Calderwood & Harkness LLP
Category | Rate
Partners (James Prentice, Sandra Tung, Leonard Cross) | $1,150 per hour
Associates (Megan Chu, Derek Okonkwo) | $725 per hour

CALDERWOOD & HARKNESS LLP Attorneys at Law

VIA HAND DELIVERY AND ELECTRONIC MAIL

CALDERWOOD & HARKNESS LLP

ACKNOWLEDGED AND AGREED:

CALLOWAY-BRIGGS RENEWABLES INC.

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