SEC Form PREM14A filed by Altus Power Inc.

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

 

 

Filed by the Registrant ☒

Filed by a Party other than the Registrant ☐

Check the appropriate box:

 

☒	Preliminary Proxy Statement

 

☐	Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

 

☐	Definitive Proxy Statement

 

☐	Definitive Additional Materials

 

☐	Soliciting Material Pursuant to §240.14a-12

ALTUS POWER, INC.

(Name of Registrant as Specified In Its Charter)

Payment of Filing Fee (Check all boxes that apply):

 

☐	No fee required

 

☐	Fee paid previously with preliminary materials

 

☒	Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11

 

 

 

PRELIMINARY PROXY STATEMENT—SUBJECT TO COMPLETION, DATED February 25, 2025

ALTUS POWER, INC.

2200 Atlantic Street, 6th Floor

Stamford, CT 06902

To our Stockholders:

You are cordially invited to attend a special meeting of the stockholders (including any adjournments or postponements thereof, the “Special Meeting”) of Altus Power, Inc., a Delaware corporation (“Altus Power,” the “Company,” “we,” “us”, or “our”), to be held on   , 2025, at  a.m. EDT. The Special Meeting will be held virtually via live webcast at https://www.cstproxy.com/altuspower/sm2025. You will not be able to physically attend the Special Meeting in person. If you plan to attend the Special Meeting online, please follow the instructions in the “General Information” section of the accompanying proxy statement (the “Proxy Statement”). The Proxy Statement is dated   , 2025, and together with the enclosed form of proxy card, is first being sent or provided to stockholders of the Company on or about   , 2025. For purposes of attendance at the Special Meeting, all references in the accompanying Proxy Statement to “in person” shall mean virtually present at the Special Meeting.

On February 5, 2025, we entered into an Agreement and Plan of Merger (as it may be amended from time to time, the “Merger Agreement”) with Avenger Parent, Inc., a Delaware corporation (“Parent”), and Avenger Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Parent (“Merger Sub”). The Merger Agreement provides that, upon the terms and subject to the satisfaction or waiver of the conditions set forth therein, Merger Sub will merge with and into Altus Power (the “Merger”), with Altus Power continuing as the surviving corporation and a wholly owned subsidiary of Parent (the “Surviving Corporation”).

At the Special Meeting, you will be asked to consider and vote on a proposal to adopt the Merger Agreement and approve the transactions contemplated thereby, including the Merger (the “Merger Proposal”). The affirmative vote of the holders of at least a majority of our Class A common stock, $0.0001 par value per share (the “Class A Common Stock”) outstanding and entitled to vote in accordance with the DGCL as of the close of business on   , 2025, the record date for the determination of stockholders entitled to vote at the Special Meeting (the “Record Date”), is required to approve the Merger Proposal.

At the Special Meeting, you will also be asked to consider and vote on a proposal to approve the adjournment of the Special Meeting to a later date or dates, if necessary or appropriate, including to solicit additional proxies if there are insufficient votes to approve the Merger Proposal at the time of the Special Meeting (the “Adjournment Proposal”).

Only Company stockholders of record as of the close of business   , 2025, are entitled to notice of the Special Meeting and to vote at the Special Meeting or any adjournment, postponement, or other delay thereof.

If the Merger is consummated, you will be entitled, subject to the terms and conditions of the Merger Agreement, to receive $5.00 in cash (the “Merger Consideration”), without interest and minus any applicable withholding taxes, for each share of the Class A Common Stock that you own (unless you do not vote in favor of the Merger Proposal and you are entitled to demand and have properly made a demand for appraisal and do not thereafter fail to perfect, or do not effectively withdraw or otherwise lose your right to appraisal under Delaware law with respect to such shares). The Merger Consideration represents a 66% premium to Altus Power’s closing stock price on October 15, 2025, the last trading day prior to the Company’s announcement of a formal review of strategic alternatives by its Board of Directors (the “Board”).

 

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The Board has unanimously (a) determined that the Merger Agreement and the transactions contemplated thereby, including the Merger, are advisable, fair to, and in the best interests of the Company and its stockholders, (b) approved the Merger Agreement and the transactions contemplated thereby, including the Merger, and (c) recommended that the Company stockholders adopt the Merger Agreement. The Board recommends that the Company stockholders vote: (i) “FOR” the adoption of the Merger Agreement and (ii) “FOR” the Adjournment Proposal.

The Notice of Special Meeting and the Proxy Statement on the following pages further describe the matters to be presented at the Special Meeting and provide details regarding how to attend the meeting online. We encourage you to read the Proxy Statement and its appendices, including the Merger Agreement, carefully and in their entirety. You may also obtain more information about the Company from documents we file with the United States Securities and Exchange Commission (the “SEC”) from time to time.

Whether or not you attend the Special Meeting online, it is important that your shares be represented and voted at the Special Meeting. Therefore, we urge you to promptly vote and submit your proxy by phone, via the Internet, or by signing, dating, and returning the enclosed proxy card in the enclosed envelope, which requires no postage if mailed in the United States. Instructions on how to vote your shares are included in the Proxy Statement and proxy card. If you decide to attend the Special Meeting, you will be able to vote online at the Special Meeting even if you have previously submitted your proxy, as your proxy is revocable at your option.

If you sign, date, and mail your proxy card without indicating how you wish to vote, your proxy will be counted as a vote “FOR ” the adoption of the Merger Agreement and “FOR ” the Adjournment Proposal.

If you have any questions or need assistance voting your shares, please contact our proxy solicitors, Sodali & Co. at (800) 662-5200.

Thank you for your support.

 

Gregg Felton Chief Executive Officer		Christine Detrick Chair of the Board

Neither the SEC nor any state securities regulatory agency has approved or disapproved of the transactions described in this document, including the Merger, or determined if the information contained in this document is accurate or adequate. Any representation to the contrary is a criminal offense.

 

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PRELIMINARY PROXY STATEMENT—SUBJECT TO COMPLETION, DATED FEBRUARY 25, 2025

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS TO BE HELD AT  A.M. EDT, ON   , 2025

The special meeting of the stockholders (the “Special Meeting”) of Altus Power, Inc., a Delaware corporation (“Altus Power,” the “Company,” “we,” “us,” or “our”), will be held at  a.m. EDT, on   , 2025, for the following purposes:

 

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Proposal 1—To consider and vote on a proposal to adopt the Agreement and Plan of Merger (as it may be amended from time to time, the “Merger Agreement”), dated as of February 5, 2025, by and among the Company, Avenger Parent, Inc., a Delaware corporation (“Parent”), and Avenger Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Parent (“Merger Sub”), and approve the transactions contemplated thereby, including the merger of Merger Sub with and into the Company (the “Merger”) with the Company continuing as the surviving corporation and a wholly owned subsidiary of Parent (the “Surviving Corporation”) (the “Merger Proposal”); and

 

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Proposal 2—To consider and vote on a proposal to approve the adjournment of the Special Meeting to a later date or dates, if necessary or appropriate, including to solicit additional proxies if there are insufficient votes to approve the Merger Proposal at the time of the Special Meeting (the “Adjournment Proposal”).

In addition, we will consider the transaction of any other business properly brought at the Special Meeting or any continuation, adjournment, or postponement thereof. However, pursuant to the terms of the Merger Agreement, the Merger Proposal will be the only matter (other than matters of procedure and matters required by applicable law to be voted on by the Company’s stockholders in connection with the Merger Proposal) that the Company will propose to be acted on by the stockholders of the Company at the Special Meeting.

The Special Meeting will be held solely in a virtual meeting format online at https://www.cstproxy.com/altuspower/sm2025. If you plan to attend the Special Meeting online, please follow the instructions in the “General Information” section of the attached proxy statement (the “Proxy Statement”). The Special Meeting may be continued or adjourned from time to time without notice other than by announcement at the Special Meeting. Any action on the items of business described above may be considered at the Special Meeting at the time and on the date specified above or at any time and date to which the Special Meeting may be properly continued, adjourned, or postponed.

Only holders of record of our Class A common stock, $0.0001 par value per share (the “Class A Common Stock”), at the close of business on   , 2025 (the “Record Date”) are entitled to notice of and to vote at the Special Meeting or any continuation, postponement, or adjournment of the Special Meeting by visiting https://www.cstproxy.com/altuspower/sm2025. To ensure your shares of Class A Common Stock are voted at the Special Meeting, you may submit your vote over the Internet, by telephone, or by completing, signing, and returning a proxy card. A list of stockholders of record will be available in our office located at 2200 Atlantic Street, Sixth Floor, Stamford, CT 06902, during regular business hours for a period of at least 10 days before the Special Meeting and on the Special Meeting webpage during the Special Meeting.

To participate in the Special Meeting, you will need the 16-digit control number included on your proxy card or on the instructions that accompanied your proxy materials.

The Special Meeting will begin promptly at  a.m. EDT. Online check-in will begin at  a.m. EDT, and you should allow ample time for the online check-in procedures. A list of stockholders of record will be available, during regular business hours for a period of at least 10 days preceding the Special Meeting, at our principal executive offices located at 2200 Atlantic Street, Sixth Floor, Stamford, CT 06902.

 

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It is important that your shares be represented regardless of the number of shares you may hold. Whether or not you plan to attend the Special Meeting online, we urge you to vote your shares via the toll-free telephone number or over the Internet as described in the enclosed proxy materials. If you received a copy of the proxy card by mail, you may sign, date, and mail the proxy card in the enclosed return envelope. Promptly voting your shares will ensure the presence of a quorum at the Special Meeting and will save us the expense of further solicitation. Submitting your proxy now will not prevent you from voting your shares online at the Special Meeting if you desire to do so, as your proxy is revocable at your option.

The affirmative vote of the holders of at least a majority of the shares of the Class A Common Stock outstanding and entitled to vote in accordance with the Delaware General Corporation Law (the “DGCL”) as of the close of business on the Record Date is required to approve the Merger Proposal. The Adjournment Proposal requires the affirmative vote of the majority of the Company’s Class A Common Stock present electronically or represented by proxy at the meeting and entitled to vote at the Special Meeting.

The failure to vote your shares or a broker non-vote, if any, will have the same effect as a vote “AGAINST” the Merger Proposal. Abstentions will have the same effect as votes against the Adjournment Proposal. Broker non-votes, if any, are not considered to be entitled to vote and, accordingly, will not affect the outcome of the Adjournment Proposal. However, we do not expect any broker non-votes, which are only relevant to routine matters, at the Special Meeting, because the proposals in the Proxy Statement are all non-routine matters.

The presence at the Special Meeting, by remote communication or represented by proxy, of the holders of a majority in voting power of the shares of the Class A Common Stock issued and outstanding and entitled to vote in accordance with the DGCL as of the close of business on the Record Date will constitute a quorum for the transaction of business at the Special Meeting. Broker non-votes, if any, and abstentions will be counted as present for purposes of determining the existence of a quorum.

Under Delaware law, stockholders (and beneficial owners) of the Company who do not vote in favor of the Merger Proposal (whether by voting against the Merger, abstaining, or otherwise not voting with respect to the Merger), who properly demand an appraisal of their shares, who continuously hold (in the case of holders of record) or continuously own (in the case of beneficial owners) their shares of Company Shares through the effective date of the Merger, who otherwise comply with the statutory requirements of Section 262 of the DGCL (“Section 262”), and who do not withdraw their demands or otherwise lose their rights to appraisal, subject to the conditions thereof will have the right to seek appraisal of the fair value of their shares of the Class A Common Stock as determined by the Delaware Court of Chancery if the Merger is consummated, but only if they submit a written demand for such an appraisal before the vote on the Merger Proposal and comply with the other Delaware law procedures explained in the Proxy Statement under the section titled “The Merger—Appraisal Rights.” A copy of Section 262, which details the applicable Delaware appraisal statute, is attached to the Proxy Statement as Appendix B and may be accessed without subscription or cost at the following publicly available website: https://delcode.delaware.gov/title8/c001/sc09/index.html#262.

You may revoke your proxy at any time before the vote at the Special Meeting by following the procedures outlined in the Proxy Statement.

The Board recommends that you vote:

(1) “FOR” the Merger Proposal; and

(2) “FOR” the Adjournment Proposal.

 

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By Order of the Board of Directors,

Sophia Lee

Chief Legal Officer and Corporate Secretary

Stamford, Connecticut

     , 2025

 

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Important Notice Regarding the Availability of Proxy Materials for the Special Meeting of Stockholders to Be Held at  a.m. EDT, on   , 2025:

YOUR VOTE IS IMPORTANT

WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING IN PERSON, WE ENCOURAGE YOU TO SUBMIT YOUR PROXY AS PROMPTLY AS POSSIBLE: (1) BY TELEPHONE; (2) THROUGH THE INTERNET; OR (3) BY SIGNING AND DATING THE ENCLOSED PROXY CARD AND RETURNING IT IN THE POSTAGE-PAID ENVELOPE PROVIDED. You may revoke your proxy or change your vote at any time before it is voted at the Special Meeting.

If you hold your shares in “street name,” you should instruct your bank, broker, or other nominee how to vote your shares in accordance with the voting instruction form that you will receive from your bank, broker, or other nominee. Your broker or other agent cannot vote on any of the proposals, including the proposal to adopt the Merger Agreement, without your instructions.

If you are a Company stockholder of record, voting in person by virtual ballot at the Special Meeting will revoke any proxy that you previously submitted. If you hold your shares through a bank, broker, or other nominee, you must obtain a “legal proxy” in order to vote in person at the Special Meeting.

If you fail to (1) return your proxy card, (2) grant your proxy electronically over the Internet or by telephone, or (3) vote by virtual ballot in person at the Special Meeting, your shares will not be counted for purposes of determining whether a quorum is present at the Special Meeting and, if a quorum is present, will have the same effect as a vote “AGAINST” the proposal to adopt the Merger Agreement but will have no effect on the Adjournment Proposal.

This Notice and Proxy Statement is available at

https://www.cstproxyvote.com/.

You should carefully read and consider the entire Proxy Statement and the accompanying appendices including the Merger Agreement attached as Appendix A, along with all of the documents incorporated by reference in the Proxy Statement, as they contain important information about, among other things, the Merger and how it affects you. Please contact one of our proxy solicitors if you have any questions concerning the Merger Agreement, the Merger, or the other transactions contemplated by the Merger Agreement; the Special Meeting or the accompanying Proxy Statement; would like additional copies of the accompanying Proxy Statement; or need help submitting a proxy to have your shares of the Company’s Class A Common Stock voted:

SODALI & CO.

333 Ludlow St., 5th Floor, South Tower

Stamford, Connecticut 06902

Toll-Free: (800) 662-5200

Banks and brokers call: (203) 658-9400

Email: [email protected]

 

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PROXY SUMMARY

Special Meeting of Stockholders

 

Time and Date:		a.m. EDT on    , 2025
Location:		Online via live webcast at https://www.cstproxy.com/altuspower/sm2025
Outstanding Class A Common Stock:		shares as of the Record Date

Record Date. Stockholders of record as of the close of business on   , 2025 (the “Record Date”) are entitled to notice of and to vote at the Special Meeting or any continuation, postponement, or adjournment thereof.

Meeting Admission. You are entitled to attend the virtual Special Meeting only if you were a stockholder of the Company as of the close of business on the Record Date or hold a valid proxy for the Special Meeting. The Special Meeting will be a completely virtual meeting of stockholders, which will be conducted via live webcast. You will be able to attend the Special Meeting online and submit your questions during the meeting by visiting https://www.cstproxy.com/altuspower/sm2025. You also will be able to vote your shares electronically at the Special Meeting. To participate in the Special Meeting, you will need the 16-digit control number included on your proxy card or on the instructions that accompanied your proxy materials.

Voting Matters and Board Recommendations.

 

Proposal:				Board Recommendation:
1		Approval of the Merger Proposal		FOR
2		Approval of the Adjournment Proposal		FOR

Your vote is important to us. Whether or not you plan to attend the Special Meeting online, we encourage you to read the attached proxy statement and vote as soon as possible. You may vote your shares via a toll-free telephone number or over the Internet. If you received a paper copy of a proxy card or voting instruction form by mail, you may submit your vote by completing, signing, dating, and returning your proxy card or voting instruction form in the pre-addressed envelope provided, or by following the instructions on your proxy card or voting instruction form for voting over the Internet or by telephone. For specific instructions on how to vote, please refer to the “General Information” section of the proxy statement.

How to vote. Each stockholder of Altus Power as of the close of business on the Record Date is entitled to one vote for each share of Class A Common Stock held by them on all matters presented at the Special Meeting. Shares may be voted by the following procedures:

 

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By Internet. Go to https://www.cstproxyvote.com/ and follow the instructions there. You will need the 16-digit number included on your proxy card, voting instruction form, or notice. Votes submitted via the Internet must be received by 11:59 p.m. EDT on   , 2025.

 

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By Telephone. Dial the phone number on your proxy card. You will need the 16-digit number included on your proxy card, voting instruction form, or notice. Telephone voting for stockholders of record is available 24 hours a day. Votes submitted by telephone must be received by 11:59 p.m. EDT on   , 2025. If your shares are held in an account at a bank or brokerage firm that offers telephone voting options, they will provide you with a voting instruction form that includes instructions on how to vote your shares by telephone by the deadline specified on the voting instruction form.

 

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By Mail. If you received a paper copy of a proxy card or voting instruction form, you may submit your proxy by completing, signing, and dating the proxy card or voting instruction form and mailing it in the accompanying pre-addressed envelope. To ensure they are voted at the Special Meeting, proxies submitted by mail must be received at the address provided no later than   , 2025, the last business day before the meeting.

 

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At the Special Meeting. Shares held in your name as the stockholder of record may be voted electronically if you attend the Special Meeting virtually. You will need the 16-digit control number included on your proxy card or on the instructions that accompanied your proxy materials.

 

 

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TABLE OF CONTENTS

 

		Page
PROXY STATEMENT			1
PROPOSALS			1
RECOMMENDATIONS OF THE BOARD			1
INFORMATION ABOUT THIS PROXY STATEMENT			2
SUMMARY			3
The Parties to the Merger Agreement			3
Altus Power, Inc.			3
Avenger Parent, Inc.			3
Avenger Merger Sub, Inc.			3
The Merger			4
The Special Meeting			4
The Merger Proposal			4
Record Date; Shares Entitled to Vote; Quorum			4
Vote Required to Approve the Merger Proposal			4
Recommendation of the Board and Reasons for the Merger			5
Fairness Opinion of Moelis & Company LLC			5
Certain Effects of the Merger on the Company			6
Effect on the Company if the Merger is Not Consummated			6
Merger Consideration			6
Treatment of Equity Awards, Company Stock Plan, and ESPP in the Merger			7
Interests of the Directors and Executive Officers of Altus Power in the Merger			8
Rollover Shares			9
Financing of the Merger			9
Appraisal Rights			10
Material U.S. Federal Income Tax Consequences of the Merger to Holders of Class A Common Stock			11
Regulatory Approvals Required for the Merger			11
No Shop; Acquisition Proposals			12
Conditions to the Merger			14
Termination			15
Effect of Termination			17
Termination Fees; Expense Reimbursement			17
Expenses Generally			18
The Company Support Agreements			18
Market Prices			19
GENERAL INFORMATION			20
Proxy Solicitation			20
The Merger			20
Special Meeting Information			24
Voting Information			26
THE SPECIAL MEETING			31
Date and Time of the Special Meeting			31
Purpose of the Special Meeting			31
Record Date; Shares Entitled to Vote; Quorum			31
Vote Required; Abstentions and Broker Non-Votes			32
Shares Held by Directors and Executive Officers			32
Shares Held by the Supporting Stockholders			32
Voting; Proxies			32
Attendance			32

 

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		Page
Providing Voting Instructions by Proxy			33
Shares of Class A Common Stock Held by a Record Holder			33
Shares of Class A Common Stock Held in “Street Name”			33
Revocability of Proxies			34
Abstentions			34
Adjournments and Postponements			34
Board Recommendation			35
Solicitation of Proxies			35
Anticipated Date of Consummation of the Merger			35
Appraisal Rights			35
Delisting and Deregistration of Class A Common Stock			36
Other Matters			36
Householding of Special Meeting Materials			36
Questions and Additional Information			37
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS			38
MARKET PRICES			40
THE MERGER			41
Parties Involved in the Merger			41
Altus Power, Inc.			41
Avenger Parent, Inc.			41
Avenger Merger Sub, Inc.			41
Certain Effects of the Merger on the Company			41
Effect on the Company if the Merger is Not Consummated			42
Merger Consideration			42
Background of the Merger			43
Recommendation of the Board and Reasons for the Merger			52
Fairness Opinion of Moelis & Company LLC			56
Certain Financial Forecasts			62
Interests of the Directors and Executive Officers of the Company in the Merger			64
Treatment of the Company Equity Awards, Company Stock Plan, and ESPP in the Merger			64
Director and Executive Officer Compensation Arrangements			66
Employment Agreements; Restrictive Covenant Agreements; Equity Award Agreements			66
2024 Annual Bonuses			67
Transaction Bonuses			67
2025 Company RSU Awards			67
Employee Benefits			68
Insurance and Indemnification of Directors and Executive Officers			68
Rollover Shares			68
Financing of the Merger			68
Financing Cooperation			69
Closing and Effective Time of the Merger			70
Anticipated Accounting Treatment of the Merger			70
Appraisal Rights			70
Material U.S. Federal Income Tax Consequences of the Merger to Holders of Class A Common Stock			75
U.S. Holders			77
Non-U.S. Holders			77
Information Reporting and Backup Withholding			78
Regulatory Approvals Required for the Merger			78
Delisting and Deregistration of Class A Common Stock			79

 

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		Page
PROPOSAL NO. 1: THE MERGER PROPOSAL			80
Explanatory Note Regarding the Merger Agreement			80
Closing; When the Merger Becomes Effective			80
Structure of the Merger; Certificate of Incorporation; Bylaws; Directors and Officers			81
Effect of the Merger on the Class A Common Stock			81
Conversion of Class B Common Stock			82
Treatment of Equity Awards			82
Payment for the Class A Common Stock			83
Representations and Warranties			83
Other Covenants and Agreements			87
Access and Information			87
Minimum Cash Maintenance			87
No-Shop; Acquisition Proposals			87
Special Meeting and Related Actions			91
Employee Matters			91
Efforts to Consummate the Merger			92
Conduct of Business Pending the Merger			93
Indemnification of Directors and Officers; Insurance			97
Miscellaneous Covenants			97
Conditions to the Merger			98
Termination			99
Effect of Termination			101
Termination Fees; Expense Reimbursement			101
Expenses Generally			102
Specific Performance			102
Amendments; Waiver			103
Governing Law and Jurisdiction			103
The Company Support Agreements			104
Recommendation of the Board of Directors			105
PROPOSAL NO. 2: THE ADJOURNMENT PROPOSAL			106
The Adjournment Proposal			106
Vote Required			106
Recommendation of the Board of Directors			107
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT			108
FUTURE STOCKHOLDER PROPOSALS			110
WHERE YOU CAN FIND MORE INFORMATION			111
MISCELLANEOUS			113
APPENDICES
APPENDIX A			A-1
APPENDIX B			B-1
APPENDIX C			C-1
APPENDIX D			D-1
APPENDIX E			E-1

 

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PROXY STATEMENT

ALTUS POWER, INC.

2200 Atlantic Street, Sixth Floor, Stamford, CT 06902

This proxy statement is being furnished in connection with the solicitation by the Board of Directors (the “Board”) of Altus Power, Inc., a Delaware corporation (“Altus Power,” the “Company,” “we,” “us,” or “our”) of proxies to be voted at the Special Meeting of Stockholders (the “Special Meeting”) to be held online at https://www.cstproxy.com/altuspower/sm2025 on   , 2025, at  a.m. EDT, and at any continuation, postponement, or adjournment of the Special Meeting. Holders of record of our Class A common stock, $0.0001 par value per share (the “Class A Common Stock”), at the close of business on   , 2025 (the “Record Date”) will be entitled to notice of and to vote at the Special Meeting and any continuation, postponement, or adjournment of the Special Meeting. As of the Record Date, there were    shares of Class A Common Stock outstanding and entitled to vote in accordance with the Delaware General Corporation Law (the “DGCL”) at the Special Meeting. Each share of Class A Common Stock entitled to vote at the Special Meeting is entitled to one vote on any matter presented to stockholders at the Special Meeting.

PROPOSALS

At the Special Meeting, our stockholders will be asked:

 

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To consider and vote on a proposal to adopt the Agreement and Plan of Merger (as it may be amended from time to time, the “Merger Agreement”), dated as of February 5, 2025, by and among the Company, Avenger Parent, Inc., a Delaware corporation (“Parent”), and Avenger Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Parent (“Merger Sub”), and approve the transactions contemplated thereby, including the merger of Merger Sub with and into the Company (the “Merger”), with the Company continuing as the surviving corporation and a wholly owned subsidiary of Parent (the “Surviving Corporation”) (the “Merger Proposal”); and

 

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To consider and vote on a proposal to approve the adjournment of the Special Meeting to a later date or dates, if necessary or appropriate, including to solicit additional proxies if there are insufficient votes to approve the Merger Proposal at the time of the Special Meeting (the “Adjournment Proposal”).

In addition, we will consider the transaction of any other business properly brought at the Special Meeting or any continuation, adjournment, or postponement thereof. However, pursuant to the terms of the Merger Agreement, the Merger Proposal will be the only matter (other than matters of procedure and matters required by applicable law to be voted on by the Company’s stockholders in connection with the Merger Proposal) that the Company will propose to be acted on by the stockholders of the Company at the Special Meeting.

We know of no other business that will be presented at the Special Meeting. If any other matter properly comes before the stockholders for a vote at the Special Meeting, however, the proxy holders named on the Company’s proxy card will vote your shares in accordance with their best judgment.

RECOMMENDATIONS OF THE BOARD

The Board recommends that you vote your shares as indicated below. If you return a properly completed proxy card, or vote your shares by telephone or Internet, your shares of Class A Common Stock will be voted on your behalf as you direct. If not otherwise specified, the shares of Class A Common Stock represented by the proxies will be voted at the discretion of the proxy holders.

The Board of Directors recommends that you vote:

 

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“FOR” the Merger Proposal; and

 

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“FOR” the Adjournment Proposal.

INFORMATION ABOUT THIS PROXY STATEMENT

Why you received this proxy statement. You received this proxy statement because the Board is soliciting your proxy to vote your shares at the Special Meeting. As a stockholder, you are invited to participate in the Special Meeting online via live webcast at https://www.cstproxy.com/altuspower/sm2025 and to vote on the proposals described in this proxy statement. This proxy statement includes information that we are required to provide to you under the rules promulgated by the United States Securities and Exchange Commission (the “SEC”) and that is designed to assist you in voting your shares.

Householding. Some brokers, banks, and other nominees may be participating in the practice of “householding” proxy statements and annual reports. This means that only one copy of this proxy statement for the Special Meeting may have been sent to multiple stockholders in each household. If you wish to receive a separate set of proxy materials, please submit your request to Continental Stock Transfer & Trust Co. (“Continental”), either by calling Continental at the following number, or by writing to Continental at the following address: Continental Stock Transfer & Trust Co., Proxy Department, 1 State Street, 30th Floor, New York, New York 10004; telephone: 917-262-2373. All stockholders may also call us at the number below or write to us at the following address to request a separate copy of proxy materials: Altus Power, Inc., Attention Sophia Lee, Corporate Secretary, 2200 Atlantic Street, 6th Floor, Stamford, CT 06902, telephone: (888) 882-5887. Any stockholder who wants to receive separate copies of this proxy statement or annual report to stockholders in the future, or any stockholder who is receiving multiple copies and would like to receive only one copy per household, should contact such stockholder’s broker, bank, or other nominee, or the stockholder may contact the Company at the above address and phone number.

 

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SUMMARY

This summary discusses the material information contained in this proxy statement, including with respect to the Merger and the Merger Agreement. This summary may not contain all of the information that is important to you. To understand the Merger more fully and for a more complete description of the legal terms, you should carefully read this entire proxy statement, the appendices, including the Merger Agreement, and the documents we incorporate by reference in this proxy statement. You may obtain the documents and information incorporated by reference in this proxy statement without charge by following the instructions under the section entitled “Where You Can Find More Information” of this proxy statement. The Merger Agreement is attached as Appendix A to this proxy statement.

Except as otherwise specifically noted in this proxy statement, “Altus Power,” “we,” “our,” “us,” the “Company,” and similar words refer to Altus Power, Inc. Throughout this proxy statement, we refer to Avenger Parent, Inc. as “Parent” and Avenger Merger Sub, Inc. as “Merger Sub.” In addition, throughout this proxy statement we refer to the Agreement and Plan of Merger, dated February 5, 2025, by and among Parent, Merger Sub, and the Company as the “Merger Agreement”; our Class A common stock, $0.0001 par value per share, as “Class A Common Stock”; and the holders of Class A Common Stock as “Company stockholders.” Unless indicated otherwise, any other capitalized term used herein but not otherwise defined herein has the meaning assigned to such term in the Merger Agreement.

The Parties to the Merger Agreement

Altus Power, Inc.

The Company is a Delaware corporation with principal executive offices located at 2200 Atlantic Street, Sixth Floor, Stamford, CT 06902, telephone number (203) 698-0090. The Company is a national full-service solar power company that provides clean electric power to businesses, towns, and homes, made from commercial-scale solar arrays that the Company owns and operates. Our Class A Common Stock is listed on the New York Stock Exchange (the “NYSE”) under the symbol “AMPS”. Additional information about the Company is contained in certain of its public filings that are incorporated by reference herein. See the section entitled “Where You Can Find More Information” of this proxy statement.

Avenger Parent, Inc.

Parent is a privately held Delaware corporation affiliated with TPG Global, LLC (“TPG”) through an investment fund managed by TPG (the “TPG Guarantor”). Parent was formed in 2025 solely for the purpose of engaging in the transactions contemplated by the Merger Agreement, including the Merger (collectively, the “Transactions”). Parent has not carried on any activities on or prior to the date of this proxy statement, except for activities incidental to its formation and activities undertaken in connection with the Transactions. Parent’s principal executive offices are located at 301 Commerce Street, Suite 3300, Fort Worth, TX 76102, telephone number (817) 871-4000.

Avenger Merger Sub, Inc.

Merger Sub is a privately held Delaware corporation and a direct wholly owned subsidiary of Parent that was formed in 2025 solely for the purpose of engaging in the Transactions. Merger Sub has not carried on any activities on or prior to the date of this proxy statement, except for activities incidental to its formation and activities undertaken in connection with the Transactions. Upon the consummation of the Merger, Merger Sub will merge with and into the Company, and the separate corporate existence of Merger Sub will cease. Merger Sub’s principal executive offices are located at 301 Commerce Street, Suite 3300, Fort Worth, TX 76102, telephone number (817) 871-4000.

 

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The Merger

Upon the terms and subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, Merger Sub will merge with and into Altus Power and the separate corporate existence of Merger Sub will cease to exist, with Altus Power continuing as the Surviving Corporation. As a result of the Merger, our Class A Common Stock will no longer be publicly traded and will be delisted from the NYSE. In addition, our Class A Common Stock will be deregistered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Altus Power will no longer file periodic reports with the SEC. If the Merger is completed, you will not own any shares of the capital stock of the Surviving Corporation. The Merger will become effective upon the filing of a certificate of merger with the Delaware Secretary of State in accordance with the applicable provisions of the DGCL, or at such later date and time as is agreed by Parent and the Company and agreed in the certificate of merger (the “Effective Time”).

The Special Meeting

This proxy statement is furnished in connection with the solicitation by the Board of proxies to be voted at a Special Meeting of the Company’s stockholders to be held on   , 2025, at  a.m. EDT.

At the Special Meeting, we will ask our stockholders of record as of the Record Date to vote on (a) the Merger Proposal and (b) the Adjournment Proposal.

The Merger Proposal

You will be asked to consider and vote upon the proposal to adopt the Merger Agreement and approve the Transactions. The Merger Agreement provides, among other things, that, upon the terms and subject to the satisfaction or waiver of the conditions set forth therein, Merger Sub will merge with and into the Company, with the Company continuing as the Surviving Corporation, and that at the Effective Time and as a result of the Merger, each share of Class A Common Stock issued and outstanding immediately prior to the Effective Time, including shares of Class A Common Stock issued upon conversion of shares of Class B Common Stock (but excluding any Canceled Shares, Dissenting Shares (each, as defined below under the section entitled “General Information—The Merger—What is the proposed transaction?” of this proxy statement) or the Class A Common Stock contributed to Parent by certain present and former members of management and the Board of the Company (the “Rollover Shares”) prior to the Effective Time), will be automatically canceled and converted into the right to receive the Merger Consideration, without interest and minus any applicable withholding taxes.

Following the Merger, our Class A Common Stock will no longer be publicly traded, and existing Company stockholders will cease to have any ownership interest in the Company.

Record Date; Shares Entitled to Vote; Quorum

You are entitled to receive notice of and to vote at the Special Meeting if you owned shares of Class A Common Stock as of the close of business on   , 2025, the Record Date.

A quorum of stockholders is necessary to transact business at the Special Meeting. The presence at the Special Meeting, by remote communication or represented by proxy, of the holders of a majority in voting power of the shares of Class A Common Stock issued and outstanding and entitled to vote in accordance with the DGCL at the Special Meeting as of the Record Date will constitute a quorum at the Special Meeting, permitting the Company to transact business at the Special Meeting.

Vote Required to Approve the Merger Proposal

Each share of Class A Common Stock issued and outstanding as of the close of business on the Record Date is entitled to one vote at the Special Meeting.

 

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The affirmative vote of the holders of at least a majority of the shares of Class A Common Stock outstanding and entitled to vote in accordance with the DGCL as of the close of business on the Record Date is required to approve the Merger Proposal.

The failure of any stockholder of record to submit a signed proxy card, grant a proxy electronically over the Internet or by telephone, or to vote electronically at the Special Meeting will have the same effect as a vote “AGAINST” the Merger Proposal. Abstentions or broker non-votes, if any, will have the same effect as a vote “AGAINST” the Merger Proposal.

As of the Record Date, there were    shares of Class A Common Stock outstanding and entitled to vote in accordance with the DGCL at the Special Meeting.

Recommendation of the Board and Reasons for the Merger

The Board, after considering various factors described under the section entitled “The Merger—Recommendation of the Board and Reasons for the Merger” of this proxy statement, unanimously (a) determined that the Merger Agreement and the transactions contemplated thereby, including the Merger, are advisable, fair to, and in the best interests of the Company and its stockholders, (b) approved the Merger Agreement and the transactions contemplated thereby, including the Merger, and (c) recommended that the Company stockholders adopt the Merger Agreement.

The Board recommends that you vote: (i) “FOR” the adoption of the Merger Agreement and (ii) “FOR” the Adjournment Proposal.

Fairness Opinion of Moelis & Company LLC

At the meeting of the Board on February 5, 2025 to evaluate and approve the Merger contemplated by the Merger Agreement, Moelis & Company LLC, the Company’s financial advisor with respect to the Transactions (“Moelis”), delivered an oral opinion, which was confirmed by delivery of a written opinion, dated February 5, 2025, addressed to the Board to the effect that, as of the date of the opinion and based upon and subject to the assumptions made, procedures followed, matters considered and other limitations set forth in the opinion, the Merger Consideration to be received by the holders of Altus Power Class A Common Stock in the Merger, other than Mr. Gregg Felton (the “Excluded Holder”), was fair, from a financial point of view, to such holders.

The full text of Moelis’ written opinion dated February 5, 2025, which sets forth the assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Appendix C to this proxy statement and is incorporated herein by reference. Moelis’ opinion was provided for the use and benefit of the Board (in its capacity as such) in its evaluation of the Merger. Moelis’ opinion was limited solely to the fairness, from a financial point of view, to the holders of Altus Power Class A Common Stock, other than the Excluded Holder, of the Merger Consideration to be received by such holders in the Merger, and does not address Altus Power’s underlying business decision to engage in the Transactions or the relative merits thereof as compared to any alternative business strategies or transactions that might be available to Altus Power. Moelis’ opinion does not constitute a recommendation to any stockholder of Altus Power as to how such stockholder should vote or act with respect to the Transactions or any other matter. Moelis’ opinion was approved by a Moelis fairness opinion committee.

The full text of Moelis’ written opinion should be read carefully in its entirety for a description of the assumptions made, procedures followed, matters considered, and qualifications and limitations upon the review undertaken by Moelis in preparing its opinion. You are encouraged to read the opinion carefully in its entirety.

For more information, see the section entitled “The Merger—Fairness Opinion of Moelis & Company LLC.” of this proxy statement.

 

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Certain Effects of the Merger on the Company

Upon the terms and subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, Merger Sub will merge with and into the Company, with the Company continuing as the Surviving Corporation.

The Effective Time will occur, if it occurs, upon the filing of the certificate of merger with the Delaware Secretary of State (or at such later date and time as we and Parent may agree and specify in the certificate of merger). If the Merger is consummated, you will no longer own any shares of the capital stock of the Company as of the Effective Time.

In connection with the Merger and pursuant to the terms of the Third Amended and Restated Certificate of Incorporation of the Company (the “Company Certificate”), on the business day immediately prior to the Effective Time, each share of the Company’s Class B common stock, $0.0001 par value per share (“Class B Common Stock”), then issued and outstanding will be automatically converted into shares of Class A Common Stock in accordance with the terms of, and subject to the limitations set forth in, the Company Certificate, and upon such conversion, each such share of Class B Common Stock will automatically be canceled and will cease to exist, and each former holder of Class B Common Stock will thereafter cease to have any rights with respect to such securities.

Our Class A Common Stock is currently registered under the Exchange Act and is listed on the NYSE under the symbol “AMPS.” If the Merger is consummated, the Company will cease to be a publicly traded company and will become a wholly owned subsidiary of Parent, and our Class A Common Stock will be delisted from the NYSE and deregistered pursuant to the Exchange Act.

Effect on the Company if the Merger is Not Consummated

If the Merger Proposal is not approved by the Company stockholders or if the Merger is not consummated for any other reason, the Company stockholders will continue to hold their shares of Class A Common Stock and will not receive any payment for such shares. Instead, the Company will remain a publicly traded company, our Class A Common Stock will continue to be listed and traded on the NYSE and registered under the Exchange Act, and we will continue to file periodic reports with the SEC. Under specified circumstances, upon termination of the Merger Agreement, the Company may be required to pay Parent a termination fee or expense reimbursement, as described under the section entitled “Proposal No. 1: The Merger Proposal—Termination Fees” of this proxy statement.

Furthermore, if the Merger is not consummated, and depending on the circumstances that would have caused the Merger not to be consummated, it is possible the price of the Class A Common Stock may decline significantly. If that were to occur, it is uncertain when, if ever, the price of the Class A Common Stock would return to the price at which it trades as of the date of this proxy statement.

Merger Consideration

Upon consummation of the Merger, at the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub, or the Company, or their respective stockholders, each share of Class A Common Stock issued and outstanding immediately prior to the Effective Time, including shares of Class A Common Stock issued upon conversion of shares of Class B Common Stock (but excluding any Canceled Shares, Dissenting Shares or Rollover Shares), will be automatically canceled and converted into the right to receive an amount in cash equal to $5.00 (such amount of cash, as may be adjusted pursuant to the Merger Agreement, the “Merger Consideration”), without interest and minus any applicable withholding taxes. From and after the Effective Time, all of the shares of Class A Common Stock will no longer be outstanding and will automatically be canceled and retired and will cease to exist, and each holder of a certificate (each, a “Certificate”) and each holder of a non-certificated share of Class A Common Stock represented by book-entry (each, a “Book-Entry

 

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Share”), in each case, outstanding immediately prior to the Effective Time previously representing any such shares of Class A Common Stock will thereafter cease to have any rights with respect to such securities other than the right to receive, upon surrender of such Certificates and Book-Entry Shares, the Merger Consideration in accordance with the Merger Agreement, without interest and minus any applicable withholding taxes. As described further under the section entitled “Proposal No. 1: The Merger Proposal—Payment for the Class A Common Stock” of this proxy statement, at or prior to the Effective Time, Parent will deposit or cause to be deposited (a) with a nationally recognized financial institution acting as paying agent (the “Paying Agent”), cash in an amount sufficient to pay the aggregate Merger Consideration required to be paid by the Paying Agent to the holders of Class A Common Stock in accordance with the Merger Agreement and (b) with the Company, cash in an amount sufficient to pay the aggregate RSU Consideration (as defined below) in accordance with the Merger Agreement. Promptly following the Effective Time and in any event no later than the second business day following the Effective Time, the Paying Agent will send each holder of Certificates or Book-Entry Shares a letter of transmittal instructing such holder to send its Certificates or Book-Entry Shares, as applicable, to the Paying Agent in order to receive the Merger Consideration, without interest and minus any applicable withholding taxes, for each share of Class A Common Stock represented by such Certificates or Book-Entry Shares.

If any cash payment is to be made to a person other than the person in whose name the applicable surrendered Certificate or Book-Entry Share is registered, it will be a condition of such payment that the person requesting such payment will pay, or cause to be paid, any transfer taxes required by reason of the making of such cash payment to a person other than the registered holder of the surrendered Certificate or Book-Entry Share or will establish to the reasonable satisfaction of the Paying Agent that such taxes have been paid or are not payable.

After the Merger is consummated, under the terms of the Merger Agreement, you will have the right to receive the Merger Consideration (except with respect to Dissenting Shares), without interest and minus any applicable withholding taxes, but you will no longer have any rights as a Altus Power stockholder as a result of the Merger (except with respect to Dissenting Shares), nor will you be entitled to receive any shares in Parent or the Surviving Corporation.

Treatment of Equity Awards, Company Stock Plan, and ESPP in the Merger

Under the Merger Agreement, except as otherwise agreed upon in writing between the applicable holder and Parent prior to the Effective Time, effective as of immediately prior to the Effective Time, each time-based restricted stock unit award (a “Company RSU Award”) and performance-based restricted stock unit award (a “Company PSU Award” and, collectively, the “Company Compensatory Awards”) will be treated as follows:

 

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Each Company RSU Award that becomes vested prior to or in connection with the Merger (a “Vested Company RSU Award”) and remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into the right to receive an amount in cash (without interest) equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Vested Company RSU Award by (b) the Merger Consideration (the “RSU Consideration”), payable as soon as practicable following the consummation of the Transactions (the “Closing”).

 

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Each Company RSU Award that is not a Vested Company RSU Award (an “Unvested Company RSU Award”) that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into the right to receive an amount in cash, if any (without interest) (a “Post-Closing Cash Award”), equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Unvested Company RSU Award by (b) the Merger Consideration, and such Post-Closing Cash Award will vest and become payable pursuant to the same vesting schedule applicable to the Unvested Company RSU Award from which it was converted (including any accelerated vesting terms), subject to the holder’s continued employment with Parent and its subsidiaries (including the Surviving Corporation) through the applicable vesting date.

 

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Each Company PSU Award that is earned based on the achievement of relative total stockholder return goals (a “Company TSR PSU Award”) and remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into a Post-Closing Cash Award, if any, equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Company TSR PSU Award (with the Merger Consideration used to determine the Company’s percentile rank relative to the applicable peer groups and such performance-based goals deemed to be achieved based on such relative percentile rank as of the date of the Merger Agreement) by (b) the Merger Consideration, and such Post-Closing Cash Award will vest and become payable pursuant to the same time-vesting schedule applicable to the Company TSR PSU Award from which it was converted (including any accelerated vesting terms), subject to the holder’s continued employment with Parent and its subsidiaries (including the Surviving Corporation) through the applicable vesting date.

 

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Each Company PSU Award that is earned based on the achievement of per share Class A Common Stock price goals and installed solar capacity goals (a “Company GW PSU Award”) and remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into a Post-Closing Cash Award, if any, equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Company GW PSU Award (with any per share stock price performance-based goals deemed to be achieved based on the Merger Consideration) by (b) the Merger Consideration, and such Post-Closing Cash Award will vest and become payable pursuant to the same time-vesting schedule and based on the achievement of the same installed solar capacity goals applicable to the Company GW PSU Award from which it was converted (including any accelerated vesting terms), subject to the holder’s continued employment with Parent and its subsidiaries (including the Surviving Corporation) through the applicable vesting date.

 

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Each Company PSU Award that is earned based on the achievement of per share Class A Common Stock price goals (a “Company Stock Price PSU Award”) and remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time for no consideration.

Any amounts payable with respect to the Company RSU Awards and Company PSU Awards will be subject to deduction for any required tax withholding.

Subject to the consummation of the Merger, the Altus Power, Inc. 2021 Omnibus Incentive Plan (the “2021 Plan”) will terminate effective as of immediately prior to the Effective Time.

Effective as of the date of the Merger Agreement, no participants have been (or will be) allowed to participate in the Altus Power, Inc. 2021 Employee Stock Purchase Plan (the “ESPP”). Subject to the consummation of the Merger, the ESPP will terminate effective as of immediately prior to the Effective Time.

Interests of the Directors and Executive Officers of Altus Power in the Merger

When considering the recommendation of the Board with respect to the Merger Proposal, you should be aware that our directors and executive officers may have interests in the Merger that are different from, or in addition to, your interests as a stockholder. The Board was aware of these interests and considered them, among other matters, in evaluating and approving the Merger Agreement and the Merger and in recommending that the Merger Proposal be approved by our stockholders. These interests include the following:

 

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certain directors and executive officers hold outstanding Class A Common Stock and Company Compensatory Awards, and certain executive officers may receive additional Company RSU Awards that will be canceled and converted into the right to receive the Merger Consideration or Post-Closing Cash Awards, as applicable (as described above), subject to applicable tax withholding;

 

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our executive officers are parties to arrangements with Altus Power or its affiliates that provide for severance benefits, including vesting in full (to the extent then-unvested) of Company Compensatory Awards, in the event of certain terminations of employment;

 

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our current directors are parties to arrangements with Altus Power or its affiliates that provide for vesting in full (to the extent then-unvested) of Company RSU Awards upon a change in control of the Company;

 

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certain executive officers and directors are expected to receive cash transaction payments in connection with the Merger;

 

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the Merger Agreement includes provisions assuring payment of bonuses under the Company’s 2024 bonus program and the provision of certain compensation and benefits for a period of 12 months following the Effective Time, in each case, for continuing employees of the Company, including each current executive officer;

 

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our Chief Executive Officer is expected to enter into an agreement with Parent pursuant to which all Unvested Company RSU Awards held by him will be converted into awards settled in equity interests in Parent;

 

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certain present and former members of management and the Board of the Company hold Rollover Shares; and

 

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the Merger Agreement provides for continued indemnification and directors’ and officers’ liability insurance to be provided by the Surviving Corporation.

If the Merger Proposal is approved by our stockholders and the Merger closes, any shares of our Class A Common Stock held by our directors and executive officers and other members of management other than the Rollover Shares will be treated in the same manner as outstanding shares of Class A Common Stock held by all other stockholders of the Company entitled to receive the Merger Consideration.

Rollover Shares

Pursuant to the Merger Agreement and that certain Rollover Agreement, dated February 5, 2025, by and among Gregg Felton, Dustin Weber, and certain other members of management of the Company (collectively, the “Rollover Stockholders”) and Parent (as may be amended, the “Rollover Agreement”), the Rollover Stockholders will, immediately prior to the Effective Time, contribute to Parent certain of their respective Rollover Shares in exchange for newly issued equity interests of Parent in accordance with the terms of the Rollover Agreement (the “Rollover”).

In addition, the Rollover Agreement provides that all Unvested Company RSU Awards held by Gregg Felton immediately prior to the Effective Time (the “Rollover RSUs”) will be converted into awards that will be settled in equity interests of Parent pursuant to the terms and conditions of a separate agreement between Parent and Mr. Felton.

Financing of the Merger

The Merger Agreement is not conditioned upon receipt of financing by Parent. We anticipate that the total amount of funds necessary to consummate the Merger and the other Transactions, not including fees and expenses, will be approximately $905,371,158, including the estimated funds needed to (a) pay our stockholders the Merger Consideration due to them under the Merger Agreement; (b) make payments in respect of certain outstanding Company RSU Awards pursuant to the Merger Agreement; and (c) pay, redeem, or otherwise terminate any outstanding net indebtedness of the Company (the “Financing Purposes”).

Pursuant to that certain equity commitment letter, dated as of February 5, 2025 (the “Equity Commitment Letter”), the TPG Guarantor has committed, subject to the terms and conditions set forth therein, to capitalize Parent in an aggregate amount of up to $920,371,158 (the “Equity Financing”) at or prior to the Closing. The proceeds from the Equity Financing will be used to fund: (a) the payment of the aggregate Merger Consideration

 

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and RSU Consideration to which holders of the Company’s common stock and Company Compensatory Awards will be entitled at the Effective Time pursuant to the Merger Agreement; (b) the repayment of the APAGH Term Loan (as defined in the Merger Agreement) and outstanding borrowings under the APAG Revolver (as defined in the Merger Agreement) as of the date of the Equity Commitment Letter (including principal, interest, premiums, fees, and charges related thereto) unless such facilities are refinanced or applicable lender consents are received prior to the Closing; and (c) the payment of all fees and expenses to be paid by Parent or Merger Sub in connection with the Transactions.

Additionally, Parent has obtained financing commitments pursuant to a debt commitment letter, dated as of February 5, 2025 (the “Debt Commitment Letter”) for the purpose of (a) refinancing the APAGH Term Loan concurrently with the Closing of the Merger and the other Transactions (the “Refinancing”), (b) paying fees and expenses incurred in connection with the Refinancing and the transactions related thereto and (c) making distributions to indirectly fund a portion of the Merger Consideration (the “Committed Debt Financing”).

The TPG Guarantor has also provided a limited guarantee (the “Limited Guaranty”) with respect to the payment of the termination fee payable by Parent under the Merger Agreement, and certain associated fees and expenses, in the event such termination fee becomes payable, subject to the terms and conditions set forth in the Merger Agreement and the Limited Guaranty.

The Merger Agreement provides that Parent will use reasonable best efforts to take, or cause to be taken, all actions, and do, or cause to be done, all things necessary or advisable to consummate the Equity Financing on or prior to the Closing Date in accordance with the terms, and subject to the conditions, set forth in the Equity Commitment Letter. The Merger is not conditioned on Parent’s or Merger Sub’s receipt of the Committed Debt Financing or the Equity Financing.

Appraisal Rights

Pursuant to Section 262 of the DGCL (“Section 262”), Altus Power stockholders who continuously hold shares of Class A Common Stock through the Effective Time, and who do not vote such shares in favor of adoption of the Merger Agreement, and beneficial owners of shares of Class A Common Stock held either in voting trust or by a nominee on behalf of such person who beneficially own shares of Class A Common Stock through the Effective Time that are not voted in favor of the adoption of the Merger Agreement, and in either case who properly demand appraisal of their shares and otherwise comply fully with the applicable requirements of Section 262 and do not otherwise withdraw or lose the right to appraisal under the DGCL, have the right to seek appraisal of the fair value of their shares, as determined by the Delaware Court of Chancery, if the Merger is consummated.

The “fair value” of shares as determined by the Delaware Court of Chancery may be more than, less than, or equal to the value of the Merger Consideration that the stockholders or beneficial owners would otherwise be entitled to receive under the terms of the Merger Agreement. Stockholders also should be aware that an investment banking opinion as to the fairness, from a financial point of view, of the consideration payable in a sale transaction, such as the Merger, is not an opinion as to, and does not otherwise address, “fair value” under Section 262.

The right to seek appraisal will be lost if with respect to shares that a Company stockholder votes “FOR” the proposal to adopt the Merger Agreement. However, abstaining or voting against adoption of the Merger Agreement is not in itself sufficient to perfect appraisal rights because additional actions must also be taken to perfect such rights. Stockholders (or beneficial owners of shares of Class A Common Stock held either in voting trust or by a nominee on behalf of such person) who wish to preserve any appraisal rights they may have, must so advise the Company by submitting a written demand for appraisal prior to the vote to adopt the Merger Agreement and must otherwise follow fully the procedures prescribed by Section 262. Any demand for appraisal made by a beneficial holder of shares of Class A Common Stock with respect to shares held of record in the

 

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name of a voting trust or nominee, such as a bank, broker, or other nominee, on behalf of such person must (a) reasonably identify the holder of record of the shares for which the demand is made, (b) provide documentary evidence of such beneficial owner’s beneficial ownership and a statement that such documentary evidence is a true and correct copy of what it purports to be, and (c) provides an address at which such beneficial owner consents to receive notices given by the Company and the office of Register in Chancery and to be set forth on the verified list required Section 262(f) of the DGCL.

Additionally, because the Class A Common Stock will have been publicly listed on the NYSE, the Delaware Court of Chancery is required under Section 262 to dismiss the proceedings as to all holders of such shares who are otherwise entitled to appraisal rights unless (a) the total number of shares entitled to appraisal exceeds 1% of the outstanding shares of Class A Common Stock or (b) the value of the Merger Consideration for such total number of shares of Class A Common Stock exceeds $1 million.

For a description of the rights of such holders and of the procedures to be followed to assert such rights and obtain payment of the fair value of their shares of Class A Common Stock, see the section entitled “The Merger—Appraisal Rights” of this proxy statement and the text of Section 262, which is reproduced in its entirety as Appendix B to this proxy statement and may be accessed without subscription or cost at the following publicly available website: https://delcode.delaware.gov/title8/c001/sc09/index.html#262.

In view of the complexity of Section 262, Company stockholders and beneficial owners that may wish to pursue appraisal rights are urged to consult legal counsel.

Material U.S. Federal Income Tax Consequences of the Merger to Holders of Class A Common Stock

The receipt of cash by a U.S. Holder (as defined below under the section entitled “The Merger—Material U.S. Federal Income Tax Consequences of the Merger to Holders of Class A Common Stock” of this proxy statement) in exchange for such U.S. Holder’s shares of Class A Common Stock in the Merger generally will result in the recognition of gain or loss in an amount measured by the difference between the cash such U.S. Holder receives in the Merger (determined before deduction of any applicable withholding taxes) and such U.S. Holder’s adjusted tax basis in the shares of Class A Common Stock surrendered in the Merger. Such gain or loss generally will be capital gain or loss and will be long-term capital gain or loss if such U.S. Holder’s holding period in such shares is more than one year at the time of the consummation of the Merger. A reduced tax rate on capital gain generally will apply to long-term capital gain of a non-corporate U.S. Holder. There are limitations on the deductibility of capital losses.

A Non-U.S. Holder (as defined below under the section entitled “The Merger—Material U.S. Federal Income Tax Consequences of the Merger to Holders of Class A Common Stock” of this proxy statement) generally will not be subject to U.S. federal income tax with respect to the exchange of shares of our Class A Common Stock for cash in the Merger unless such Non-U.S. Holder has certain connections to the United States.

Stockholders should refer to the discussion under the section entitled “The Merger—Material U.S. Federal Income Tax Consequences of the Merger to Holders of Class A Common Stock” of this proxy statement and should consult their tax advisors concerning the U.S. federal income tax consequences relating to the Merger in light of their particular circumstances as well as any consequences arising under the laws of any state, local, or foreign taxing jurisdiction or other tax laws.

Regulatory Approvals Required for the Merger

Under the Merger Agreement, the Merger cannot be consummated until (1) the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), has expired or been terminated; and (2) required approval from the Federal Energy Regulatory Commission (“FERC”) pursuant to Section 203 of the Federal Power Act (the “FPA”) has been obtained. Additionally, the Merger cannot be

 

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consummated if any order, judgment, decree, injunction, or ruling (whether temporary, preliminary, or permanent) of any governmental authority enjoining, restraining, making illegal, or prohibiting the Merger is in effect.

Altus Power and Parent and their respective affiliates filed their applicable HSR Act notifications on February 6, 2025. The 30-day HSR waiting period with respect to the Merger, which cannot expire on a Saturday, Sunday, or a U.S. federal holiday, is expected to expire at 11:59 p.m. EDT on March 10, 2025, unless the Federal Trade Commission (“FTC”) or the Department of Justice (“DOJ”) earlier terminates the waiting period or issues requests for additional information and documentary material related to the Merger (“Second Requests”). If the FTC or the DOJ issues Second Requests, the waiting period with respect to the Merger will be extended for an additional period of 30 calendar days, which will begin on the date on which both parties have substantially complied with their respective Second Requests. Complying with Second Requests can take a significant period of time.

Parent is subject to the jurisdiction of FERC under Part II of the FPA. Section 203(a)(1) of the FPA provides that no public utility shall sell, lease, or dispose of its jurisdictional facilities or merge or consolidate, either directly or indirectly, such facilities without securing an order from FERC authorizing it to do so. Section 203(a)(2) of the FPA further provides that no holding company in a holding company structure that includes a transmitting utility or an electric utility may purchase, acquire, merge, or consolidate with a transmitting utility, an electric utility company, or a holding company in a holding company structure that includes a transmitting utility or electric utility company without prior FERC authorization. Because all of the Company’s subsidiaries’ operational projects are Qualifying Facilities (as defined in the Merger Agreement) exempt from Section 203 of the FPA, the Company will not need approval under Section 203(a)(1) of the FPA for the Merger. However, FERC’s approval of the Merger under Section 203(a)(2) of the FPA is required and FERC must authorize the Merger if it finds that the Merger is consistent with the public interest (the “FERC 203 Approval”). The Company and Parent filed an application with FERC on February 20, 2025.

No Shop; Acquisition Proposals

From February 5, 2025, until the earlier of the Effective Time or the date, if any, on which the Merger Agreement is validly terminated in accordance with its terms, the Company is not permitted to (and will cause its subsidiaries and will use commercially reasonable efforts to cause its and their representatives not to):

 

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solicit, initiate, seek, or knowingly facilitate or encourage any inquiry, discussion, offer, or request that constitutes, or would reasonably be expected to lead to, an Acquisition Proposal (as defined and described under the section entitled “Proposal No. 1: The Merger Proposal—Other Covenants and Agreements—No Shop; Acquisition Proposals” of this proxy statement);

 

•

enter into, continue, or otherwise participate in any discussions or negotiations with, or furnish any non-public information relating to the Company and its subsidiaries to, or afford access to the books or records, properties, assets, facilities, or officers, employees, or other personnel of the Company and its subsidiaries to, or provide any physical or electronic data room access to, any third party with respect to an Acquisition Proposal or any inquiry, proposal, or offer that would reasonably be expected to lead to an Acquisition Proposal (subject to certain exceptions described under the section entitled “Proposal No. 1: The Merger Proposal—Other Covenants and Agreements—No Shop; Acquisition Proposals” of this proxy statement);

 

•

approve, endorse, recommend, or enter into (or publicly propose to approve, endorse, recommend, or enter into) any letter of intent, memorandum of understanding, agreement in principle, acquisition agreement, merger agreement, or other definitive agreement with respect to any Acquisition Proposal, other than an Acceptable Confidentiality Agreement (as defined in the Merger Agreement) (an “Alternative Acquisition Agreement”); or

 

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submit any Acquisition Proposal to the vote of the Company’s stockholders.

 

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However, if before obtaining the Required Company Stockholder Approval (as defined and described under the section entitled “Proposal No. 1: The Merger Proposal—Other Covenants and Agreements—No Shop; Acquisition Proposals” of this proxy statement), the Company receives a bona fide written Acquisition Proposal from a third party that was not solicited at any time following the execution of the Merger Agreement and that did not result from a breach of the no-shop provisions of the Merger Agreement and the Board determines in good faith, after consultation with its independent financial advisor and outside legal counsel, that (a) such proposal constitutes, or would reasonably be expected to lead to a Superior Proposal (as defined and described under the section entitled “Proposal No. 1: The Merger Proposal—Other Covenants and Agreements—No Shop; Acquisition Proposals” of this proxy statement), and (b) the failure to take the action described immediately below would violate the Board’s fiduciary duties under applicable law, then the Company and its representatives may:

 

•

furnish non-public information and afford access to the books, records properties, assets, facilities, and officers, employees, and other personnel of the Company and its subsidiaries to such third party and its representatives pursuant to an Acceptable Confidentiality Agreement;

 

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engage in discussions and negotiations with such third party and its affiliates and representatives with respect to the Acquisition Proposal; and

 

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otherwise facilitate such Acquisition Proposal or assist such third party (and its affiliates, representatives, prospective debt and equity financing sources, or their respective representatives) with such Acquisition Proposal, in each case, if requested by such third party.

Except as described below, neither the Board nor any committee of the Board is permitted to take any action constituting an Adverse Recommendation Change (as defined and described under the section entitled “Proposal No. 1: The Merger Proposal—Other Covenants and Agreements—No Shop; Acquisition Proposals” of this proxy statement) or to cause or permit the Company to enter into any Alternative Acquisition Agreement.

Before obtaining the Required Company Stockholder Approval and after first complying with the no-shop and related provisions of the Merger Agreement described in this proxy statement, the Board, in response to a bona fide Acquisition Proposal received by the Company or the Board that did not arise from a breach of the no-shop and related provisions of the Merger Agreement (other than any breach that is both immaterial and unintentional), may:

 

•

effect an Adverse Recommendation Change; or

 

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authorize the Company to terminate the Merger Agreement and substantially concurrently with such termination enter into a definitive agreement providing for such Superior Proposal;

provided, however, that the Board is not permitted to take the actions described in the two bullet points immediately above unless, among other things, (a) the Board determines in good faith, after consultation with its independent financial advisor and outside legal counsel, that failure to effect an Adverse Recommendation Change or terminate the Merger Agreement in accordance with the second bullet point above would violate its fiduciary duties pursuant to applicable law; (b) at least four business days have elapsed after the Company provided Parent with written notice that it intended to effect an Adverse Recommendation Change and terminate the Merger Agreement, which such written notice includes, among other things, written notice of the material terms of the Acquisition Proposal and an unredacted copy of the Alternative Acquisition Agreement (as defined in the Merger Agreement) in respect of such Acquisition Proposal; (c) in such four-business day period, the Company and its representatives have used commercially reasonable efforts to negotiate with Parent in good faith (to the extent Parent so desires to negotiate) any proposed modifications to the terms and conditions of the Merger Agreement, the Equity Commitment Letter, the Limited Guaranty provided by the TPG Guarantor, and the debt commitment letter so that such Acquisition Proposal ceases to constitute a Superior Proposal; and (d) following the end of such four business day period described in the preceding clause (c), the Board determines in good faith, after consultation with its independent financial advisor and outside legal counsel,

 

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taking into account any changes to the Merger Agreement and the other transaction documents offered in writing by Parent in response to the notice described in clause (b) above, that the Superior Proposal giving rise to the notice of Adverse Recommendation Change continues to constitute a Superior Proposal. In the event of any material amendment of such Superior Proposal, the Board (or any committee thereof) shall be required to issue a new written notice that it intends to effect an Adverse Recommendation Change and again comply with the procedures described in clauses (c) and (d) of this paragraph; provided, however, that for purposes of this sentence, references to the four-business day period above shall be deemed to be references to a two-business day period from the time of Parent’s receipt of the new notice.

For a further discussion of the limitations on solicitation of Acquisition Proposals from third parties, the limitations on Adverse Recommendation Changes, and approving or recommending a Superior Proposal, see the section entitled “Proposal No. 1: The Merger Proposal—Other Covenants and Agreements—No Shop; Acquisition Proposals” of this proxy statement.

Conditions to the Merger

The respective obligations of the Company, Parent, and Merger Sub to consummate the Merger and the other Transactions are subject to the satisfaction (or written waiver by all parties, if permissible under applicable law) at or prior to the Effective Time, of each of the following conditions:

 

•

the Company will have obtained the “Required Company Stockholder Approval” (as defined and described under the section entitled “Proposal No. 1: The Merger Proposal—Other Covenants and Agreements—No Shop; Acquisition Proposals” of this proxy statement);

 

•

any applicable waiting period (and any extension thereof) under the HSR Act, and any commitment to, or agreement with, any governmental authority to delay the consummation of, or not to consummate before a certain date, the Merger, shall have expired or been terminated and the FERC 203 Approval shall have been obtained; and

 

•

the consummation of the Transactions will not then be enjoined, prohibited, or made unlawful by any governmental order or any applicable law (whether temporary, preliminary, or permanent).

The obligations of Parent and Merger Sub to consummate the Merger are subject to the satisfaction (or waiver by Parent, if permissible under applicable law) at or prior to the Closing, of the following additional conditions:

 

•

certain specified fundamental representations and warranties made by the Company will be true and correct, in each case, as of the Closing Date as if made at and as of the Closing Date (except for any such representations and warranties that speak as of a particular date, which will be true and correct only as of such date);

 

•

certain representations and warranties with respect to the capitalization of the Company will be true and correct in all respects, except for any de minimis inaccuracies, as of the Closing Date as if made on the Closing Date (except for any such representations and warranties that speak as of a particular date, which will be true and correct in all respects, except for any de minimis inaccuracies, only as of such date);

 

•

each of the other representations and warranties made by the Company (without giving effect to any references to any “Company Material Adverse Effect” or other materiality qualifications) will be true and correct in all respects as of the Closing Date as if made on the Closing Date (except for representations and warranties that speak as of a particular date, which will be true and correct in all respects only as of such date), in each case, except where the failure to be so true and correct has not had and would not reasonably be expected to have a Company Material Adverse Effect;

 

•

the Company’s compliance with the covenants and obligations that the Company is required to comply with or perform under the Merger Agreement prior to the Closing in all material respects;

 

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•

since the date of the Merger Agreement, there will not have occurred any Company Material Adverse Effect (as defined under the section entitled “Proposal No. 1: The Merger Proposal—Representations and Warranties” of this proxy statement);

 

•

the Required Debt Consents (as defined under the section entitled “Proposal No. 1: The Merger Proposal—Conduct of Business Pending the Merger” of this proxy statement) will have been obtained; and

 

•

Parent will have received a certificate executed on behalf of the Company by its authorized representative to the effect that the conditions described in the six preceding bullet points have been satisfied.

The obligations of the Company to consummate the Merger and the other Transactions are subject to the satisfaction (or waiver by the Company, if permissible under applicable law), at or prior to the Closing, of the following additional conditions:

 

•

certain specified fundamental representations and warranties made by Parent and Merger Sub will be true and correct in all respects as of the Closing Date as if made on and as of the Closing Date (except for representations and warranties that speak as of a particular date, which will be true and correct only as of such date);

 

•

each of the other representations and warranties made by Parent and Merger Sub in the Merger Agreement (without giving effect to any references to materiality qualifications) will be true and correct in all respects as of the Closing Date as if made on and as of the Closing Date (except for representations and warranties that speak as of a particular date, which shall be true and correct in all respects only as of such date), in each case, except where the failure to be so true and correct has not had and would not reasonably be expected to have a material adverse effect on the ability of Parent and Merger Sub to consummate the Merger or perform their respective obligations under the Merger Agreement;

 

•

Parent’s and Merger Sub’s compliance with the covenants and obligations that Parent and Merger Sub are required to comply with or perform under the Merger Agreement prior to the Closing in all material respects; and

 

•

the Company will have received a certificate duly executed on behalf of Parent by its authorized representative to the effect that the conditions described in the three preceding bullet points have been satisfied.

Termination

The Merger Agreement may be terminated and the Merger and the other Transactions may be abandoned at any time prior to the Effective Time notwithstanding receipt of the Required Company Stockholder Approval (except as expressly noted), only as follows:

 

•

by mutual written agreement of Parent and the Company.

 

•

by either Parent or the Company:

 

•

if the Closing has not occurred on or before 5:00 p.m. ET on November 5, 2025 (the “End Date”), whether such date is before or after the date of the receipt of the Required Company Stockholder Approval, so long as the terminating party’s failure to perform or comply with any covenant or obligation under the Merger Agreement is not the principal cause of, or did not result in, the failure of the Closing to have occurred on or before the End Date;

 

•

if any governmental authority shall have issued, entered, enacted, or promulgated a governmental order or other applicable law permanently enjoining or otherwise permanently prohibiting or making unlawful, the consummation of the Transactions and such governmental order or other

 

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applicable law shall, if applicable, have become final and nonappealable, so long as the terminating party’s failure to perform any covenant or obligation under the Merger Agreement has not been the principal cause of, or resulted in, the issuance of such order, decree, or ruling or law; or

 

•

if the Special Meeting (including any adjournments and postponements thereof) shall have been held and completed and the Company stockholders did not vote to adopt the Merger Agreement;

 

•

by the Company:

 

•

if there is a breach of any representation, warranty, covenant, or agreement set forth in the Merger Agreement on the part of Parent or Merger Sub such that the conditions to the Merger for the benefit of the Company relating to Parent’s and Merger Sub’s representations, warranties, covenants, and agreements cannot be satisfied at the Closing and has not been cured by the date that is the earlier of (x) 45 days after the Company notified Parent of such breach and (y) two business days prior to the End Date; provided that the Company will only have this termination right so long as there is no material breach of any of its material obligations under the Merger Agreement such that the conditions to the Merger for the benefit of Parent and Merger Sub relating to the Company’s representations, warranties, covenants, and agreements cannot be satisfied at the Closing;

 

•

prior to receipt of the Required Company Stockholder Approval, in order to enter into a definitive agreement with respect to a Superior Proposal, so long as the Company has complied with the no-shop and related provisions in the Merger Agreement described in the section entitled “Proposal No. 1: The Merger Proposal—Other Covenants and Agreements—No Shop; Acquisition Proposals” of this proxy statement, the Company enters into such definitive agreement substantially concurrently with such termination and the Company pays or causes to be paid to Parent the termination fee described below within five business days following such termination; or

 

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if (a) (i) the mutual conditions to the Merger for the benefit of the Company, Parent, and Merger Sub and (ii) the conditions to the Merger for the benefit of Parent and Merger Sub (in each case, other than conditions which are to be satisfied by actions taken at the Closing) have been satisfied or waived, (b) Parent failed to consummate the Closing or the Closing would have occurred pursuant to the terms of the Merger Agreement, (c) the Company delivered to Parent an irrevocable notice that (i) the Company stood ready, willing, and able to consummate the Closing on the date such notice is delivered and through the end of the next three-business day period, and (ii) all of the conditions to the Merger for the benefit of the Company (other than conditions that are to be satisfied by actions taken at the Closing) have been satisfied or waived, and (d) Parent failed to consummate the Closing within three business days following receipt of such notice from the Company described in the foregoing clause (c);

 

•

by Parent:

 

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if there is a breach of any representation, warranty, covenant, or agreement on the part of the Company set forth in the Merger Agreement such that the conditions to the Merger for the benefit of Parent and Merger Sub relating to the Company’s representations, warranties, covenants, and agreements cannot be satisfied at the Closing and has not been cured by the date that is the earlier of (x) 45 days after Parent notified the Company of such breach and (y) two business days prior to the End Date; provided that Parent will only have this termination right if there is no material breach of any of its material obligations under the Merger Agreement on behalf of Parent or Merger Sub such that the conditions to the Merger for the benefit of the Company relating to Parent and Merger Sub’s representations, warranties, covenants, and agreements cannot be satisfied at the Closing; or

 

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•

if prior to receipt of the Required Company Stockholder Approval, the Board makes an Adverse Recommendation Change; provided that Parent’s right to terminate on this basis expires at 5:00 p.m. EDT on the 15th business day following the date on which such Adverse Recommendation Change occurs; or

 

•

if prior to receipt of the Required Company Stockholder Approval, the Company breaches the no-shop and related provisions set forth in the Merger Agreement.

Effect of Termination

Except as described in the section entitled “Proposal No. 1: The Merger Proposal—Termination Fees” of this proxy statement, in the event the Merger Agreement is terminated under the terms thereof (see the section entitled “Proposal No. 1: The Merger Proposal—Termination” of this proxy statement), the Merger Agreement will become void and have no effect, without any liability on the part of any party thereto or its respective affiliates, officers, directors, or equityholders, other than liability of the Company, Parent, or Merger Sub for any Fraud (as defined in the Merger Agreement) or willful breach of the Merger Agreement occurring prior to such termination.

Termination Fees; Expense Reimbursement

The Company must pay, or cause to be paid, to Parent a termination fee of $60,000,000 (the “Company Termination Fee”) upon valid termination of the Merger Agreement under specified circumstances, including:

 

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the Company’s termination of the Merger Agreement in order to enter into a definitive agreement in connection with a Superior Proposal;

 

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Parent’s termination of the Merger Agreement following the Company’s breach of its no-shop and related obligations in respect of other acquisition proposals or an Adverse Recommendation Change;

 

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the termination of the Merger Agreement by the Company or Parent upon the occurrence of the End Date (as defined above), if, on that date, the Required Company Stockholder Approval has not been obtained and Parent would have been entitled to terminate the Merger Agreement due to the Company’s material breach of its non-shop and related obligations or an Adverse Recommendation Change;

 

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the termination of the Merger Agreement (a) by Parent due to the Company’s uncured breach of its representations, warranties, or covenants or (b) by the Company upon the occurrence of the End Date at a time when Parent would be permitted to terminate due to such an uncured breach by the Company, in either case, after an Acquisition Proposal has been announced, disclosed, or otherwise communicated to the Board and not withdrawn, and within 12 months after termination the Company enters into a definitive agreement for the consummation of the transaction contemplated by that Acquisition Proposal, and the Company subsequently consummates that transaction; provided, that for purposes of determining whether a Company Termination Fee is payable under this circumstance, references to 15% or more in the definition of Acquisition Proposal will be deemed to be references to “all or substantially all”; or

 

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the termination of the Merger Agreement by the Company or Parent after the Company’s stockholders have voted against the approval of the Merger after an Acquisition Proposal has been made to the Company, publicly disclosed, and not withdrawn, and within 12 months after termination the Company enters into a definitive agreement for the consummation of the transaction contemplated by that Acquisition Proposal, and the Company subsequently consummates that transaction; provided, that for purposes of determining whether a Company Termination Fee is payable under this circumstance, references to 15% or more in the definition of Acquisition Proposal will be deemed to be references to “all or substantially all”.

 

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If the Merger Agreement is terminated due to a failure of the Company’s stockholders to approve the Merger Proposal, the Company will be required to reimburse Parent for the reasonable and documented out-of-pocket fees and expenses incurred or paid by or on behalf of Parent and its Affiliates in connection with the Transactions or related to the authorization, preparation, negotiation, execution, and performance of the Merger Agreement and any other agreements, certificates, documents, or other instruments contemplated by the Merger Agreement, up to $8,000,000 (collectively, the “Expense Reimbursement”).

Parent must pay to the Company a termination fee of $70,000,000 (the “Parent Termination Fee”) if, but only if, the Merger Agreement is validly terminated:

 

•

by the Company in the event Parent fails to consummate the Merger on the scheduled closing date and all applicable closing conditions have been satisfied or waived, as applicable; or

 

•

if Parent terminates the Merger Agreement because the Merger has not been consummated by the End Date, and, at the time of such termination, the Company was otherwise entitled to terminate the Merger Agreement because Parent failed to consummate the Merger on the scheduled closing date and all conditions had been satisfied or waived, as applicable.

In addition, the TPG Guarantor has also provided a Limited Guaranty with respect to the payment of any Parent Termination Fee that may become payable by Parent to the Company, subject to the terms and conditions set forth in the Merger Agreement and such the Limited Guaranty.

Subject to the remedies of specific performance described in the section entitled “Proposal No. 1: The Merger Proposal—Termination Fees; Expense Reimbursement” of this proxy statement, Parent’s right to receive from the Company the Company Termination Fee or the Expense Reimbursement and the Company’s right to receive from Parent the Parent Termination Fee, as applicable, will, solely in circumstances in which the Company Termination Fee or Expense Reimbursement, or the Parent Termination Fee, as applicable, is owed constitute the sole and exclusive remedy of (a) Parent and Merger Sub against the Company and any of the Company’s former, current, and future Affiliates, assignees, stockholders, controlling Persons, directors, officers, employees, agents, attorneys, and other representatives and (b) the Company against Parent and Merger Sub and any of the Parent’s and Merger Sub’s former, current, and future Affiliates, assignees, stockholders, controlling Persons, directors, officers, employees, agents, attorneys, and other representatives; provided, however, that no such payment shall relieve a party of any liability or damages to the other party, as applicable, as a result of Fraud or a willful breach of any covenant, agreement, or obligation by such party (in which case such party shall be liable for damages for such Fraud or willful breach). See the section entitled “Proposal No. 1: The Merger Proposal—Termination Fees” of this proxy statement.

If the Company actually receives the foregoing Parent Termination Fee, Parent and certain of its related parties and representatives will have no further liability to the Company under the Merger Agreement.

Expenses Generally

Generally, except as described above under “Termination Fees; Expense Reimbursement” or as otherwise noted in the section entitled “Proposal No. 1: The Merger Proposal—Termination Fees” of this proxy statement, whether or not the Merger is consummated, the Company, Parent, and Merger Sub are each responsible for all of their own costs and expenses incurred in connection with the Merger and the other Transactions.

The Company Support Agreements

Gregg Felton, Dustin Weber, Anthony Savino, Abhi Parmar, funds managed by Blackstone Credit and Insurance, and CBRE Acquisition Sponsor, LLC, a subsidiary of CBRE Group, Inc. (collectively, the “Supporting Stockholders”), which collectively own approximately 40% of the voting power of our Class A Common Stock, entered into Voting and Support Agreements with Parent and the Company (collectively, the “Company Support

 

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Agreements”). Pursuant to the Company Support Agreements, the Supporting Stockholders have agreed, among other things, to vote their Covered Shares (as defined in the Company Support Agreements) in favor of the Merger, the adoption of the Merger Agreement, and each of the other actions contemplated by the Merger Agreement, and to vote the Covered Shares against any Acquisition Proposal.

Market Prices

Our Class A Common Stock is listed on the NYSE under the symbol “AMPS”. On February 4, 2025, the last trading day prior to the public announcement of the execution of the Merger Agreement, the closing price of our Class A Common Stock on the NYSE was $3.9600 per share. On   , 2025, the latest practicable trading day before the printing of this proxy statement, the closing price of our Class A Common Stock on the NYSE was $  per share. You are encouraged to obtain current market quotations for Class A Common Stock.

 

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GENERAL INFORMATION

The following questions and answers are intended to briefly address some commonly asked questions you may have regarding the Special Meeting, the Merger Agreement, and the Transactions. These questions and answers may not address all questions that may be important to you as a stockholder of the Company. Please refer to the more detailed information contained elsewhere in this proxy statement, the appendices to this proxy statement, and the documents incorporated by reference or referred to in this proxy statement, which you should read carefully and in their entirety.

Proxy Solicitation

Why am I receiving these proxy materials?

On February 5, 2025, the Company entered into the Merger Agreement with Parent and Merger Sub. The Merger Agreement provides that, upon the terms and subject to the satisfaction or waiver of the conditions set forth therein, Merger Sub will merge with and into the Company, with the Company continuing as the Surviving Corporation. The Company is holding the Special Meeting of its stockholders to obtain stockholder approval of the Merger Proposal and the Adjournment Proposal. We cannot complete the Transactions unless the Merger Proposal is approved by the affirmative vote of the holders of at least a majority of the shares of Class A Common Stock outstanding and entitled to vote in accordance with the DGCL as of the close of business on the Record Date.

This proxy statement includes important information about the Merger and the Special Meeting. The Company’s stockholders should read this information carefully and in its entirety. A copy of the Merger Agreement is attached as Appendix A to this proxy statement.

Your vote is very important—we urge you to submit your proxy as soon as possible. Please follow the instructions set forth on the enclosed proxy card (or voting instruction form provided by the record holder if your shares are held in the name of a broker, bank, or other nominee).

Who pays for this proxy solicitation?

We do. We have engaged Sodali & Co. (“Sodali”) to assist in the solicitation of proxies for the Special Meeting. We have agreed to pay Sodali a fee of $15,000, plus disbursements. We will also reimburse Sodali for reasonable out-of-pocket expenses and will indemnify Sodali and its affiliates against certain claims, liabilities, losses, damages and expenses. In addition, we will reimburse banks, brokers and other custodians, nominees and fiduciaries representing beneficial owners of shares of Class A Common Stock for their expenses in forwarding soliciting materials to beneficial owners of shares of Class A Common Stock and in obtaining voting instructions from those owners. In addition to sending you these materials, some of our employees or agents may contact you by telephone, by mail or in person. None of our employees will receive any extra compensation for providing those services.

The Merger

What is the proposed transaction?

The proposed transaction is the acquisition of the Company by Parent through the merger of Merger Sub with and into the Company, with the Company continuing as the Surviving Corporation. Following the Effective Time, the Company will be privately held as a wholly owned subsidiary of Parent. If the Merger is consummated, each share of Class A Common Stock issued and outstanding immediately prior to the Effective Time (but excluding any (a) shares of Class A Common Stock owned directly by Parent, Merger Sub, or their subsidiaries immediately prior to the Effective Time or held by the Company as treasury stock (such shares, the “Canceled Shares”) (which will be automatically canceled for no consideration), (b) shares of Class A Common Stock

 

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owned by record holders or beneficial owners who did not vote in favor of the Merger Proposal and who are entitled to demand and have properly made a demand for appraisal and do not thereafter fail to perfect, or do not effectively withdraw, or otherwise lose their appraisal rights in accordance with Section 262 (the “Dissenting Shares”), or (c) Rollover Shares) will be automatically cancelled and converted into, and thereafter represent, the right to receive the Merger Consideration. After the Merger is consummated, you will no longer have any rights as an Altus Power stockholder (except with respect to Dissenting Shares), nor will you be entitled to receive any shares in Parent or the Surviving Corporation.

What will I receive if the Merger is consummated?

Upon consummation of the Merger, you will be entitled to receive the Merger Consideration (except with respect to Dissenting Shares), without interest and minus any applicable withholding taxes, for each share of Class A Common Stock that you own (unless you own Rollover Shares (in which case you will receive newly issued equity interests of Parent in accordance with the terms of the Rollover Agreement in respect of such Rollover Shares) or do not vote in favor of the Merger Proposal and you are entitled to demand and have properly made a demand for appraisal and do not thereafter fail to perfect, or do not effectively withdraw or otherwise lose your right to appraisal under Section 262 with respect to such shares). Any shares of Class A Common Stock owned directly by Parent, Merger Sub, or any of their subsidiaries will be canceled, extinguished, and retired without any conversion thereof and will cease to exist and will no longer be outstanding, and no payment will be made in respect thereof. Any Rollover Share will be exchanged into newly issued equity interests of Parent in accordance with the terms of the Rollover Agreement. You will not be entitled to receive shares in the Surviving Corporation or in Parent as a result of the Merger.

How does the Merger Consideration compare to the market price of the Class A Common Stock prior to the public announcement of the Merger Agreement and as of a recent trading date?

The Merger Consideration represents a 66% premium to Altus Power’s closing stock price on October 15, 2024, the last trading day prior to the Company’s announcement of a formal review of strategic alternatives by the Board. On   , 2025, the last practicable day before the printing of this proxy statement, the closing price of our Class A Common Stock on the NYSE was $  per share. You are encouraged to obtain current market quotations for our Class A Common Stock.

What factors did the Board consider in deciding to enter into the Merger Agreement and recommending the approval of the Merger Proposal and the Adjournment Proposal?

In reaching its decision to approve the Merger Agreement and the Transactions, and to recommend our stockholders approve the Merger Proposal and the Adjournment Proposal, the Board consulted with our management, as well as our outside legal and financial advisors, considered the terms of the proposed Merger Agreement and the Transactions, as well as other alternatives. For a more detailed description of these factors, see the section entitled “The Merger—Recommendation of the Board and Reasons for the Merger” of this proxy statement.

What happens if I sell or otherwise transfer my shares of Class A Common Stock before consummation of the Merger?

If you sell or transfer your shares of Class A Common Stock before consummation of the Merger, you will have transferred your right to receive the Merger Consideration, without interest and minus any applicable withholding taxes, in the Merger. To receive the Merger Consideration, without interest and minus any applicable withholding taxes, you must hold your shares of Class A Common Stock through consummation of the Merger.

The Record Date for stockholders entitled to vote at the Special Meeting is earlier than the date the Merger is anticipated to be consummated. Accordingly, if you sell or transfer your shares of Class A Common Stock after

 

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the Record Date but before the Special Meeting, unless special arrangements (such as the provision of a proxy) are made between you and the person to whom you sell or otherwise transfer your shares and each of you notifies the Company in writing of such special arrangements, you will transfer the right to receive the Merger Consideration, without interest and minus any applicable withholding taxes, if the Merger is consummated, to the person to whom you sell or transfer your shares of Class A Common Stock, but you will have retained your right to vote such shares at the Special Meeting. Even if you sell or otherwise transfer your shares of Class A Common Stock after the Record Date, we encourage you to complete, date, sign, and return the enclosed proxy card or vote your shares via the Internet or telephone.

When do you expect the Merger to be consummated?

We currently anticipate that the Merger will be consummated in the second quarter of 2025, assuming satisfaction or waiver of all of the conditions to the Merger. However, because the Merger is subject to certain conditions, it is possible that factors outside the control of the Company and Parent could result in the Merger being consummated at a later time or not at all.

What effects will the Merger have on the Company?

Our Class A Common Stock is currently registered under the Exchange Act and is listed on the NYSE under the symbol “AMPS”. If the Merger is consummated, the Company will cease to be a publicly traded company and will become a wholly owned subsidiary of Parent, and our Class A Common Stock will be delisted from the NYSE and deregistered under the Exchange Act.

What happens if the Merger is not consummated?

If the Merger Proposal is not approved by our stockholders or if the Merger is not consummated for any other reason, the Company stockholders will retain their shares of Class A Common Stock and will not receive any payment for such shares. Instead, the Company will remain an independent publicly traded company, our Class A Common Stock will continue to be listed and traded on the NYSE and registered under the Exchange Act, and we will continue to file periodic reports with the SEC.

Furthermore, if the Merger is not consummated, and depending on the circumstances that would have caused the Merger not to be consummated, it is possible the price of our Class A Common Stock may decline significantly. If that were to occur, it is uncertain when, if ever, the price of our Class A Common Stock would return to the price at which it trades as of the date of this proxy statement.

Under specified circumstances, we may be required to pay Parent a termination fee or expense reimbursement upon the termination of the Merger Agreement as described under the section entitled “Proposal No. 1: The Merger Proposal—Termination Fees” of this proxy statement.

Do any directors or executive officers have interests in the Merger that may differ from those of the Company’s stockholders generally?

In considering the recommendation of the Board with respect to the Merger Proposal, you should be aware that our directors and executive officers may have interests in the Merger that are different from, or in addition to, your interests as a stockholder. The Board was aware of these interests and considered them, among other matters, in evaluating and approving the Merger Agreement and the Merger and in recommending that the Merger Proposal be approved by our stockholders. For a description of the interests of our directors and executive officers in the Merger, see “The Merger—Interests of the Directors and Executive Officers of the Company in the Merger.”

 

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Will I be subject to U.S. federal income tax upon the exchange of Class A Common Stock for cash pursuant to the Merger?

The exchange of our Class A Common Stock for cash pursuant to the Merger generally will require a U.S. Holder (as defined below under the section entitled “The Merger—Material U.S. Federal Income Tax Consequences of the Merger to Holders of Class A Common Stock” of this proxy statement) to recognize gain or loss for U.S. federal income tax purposes in an amount equal to the difference between the amount of cash received by such U.S. Holder pursuant to the Merger (determined before deduction of any applicable withholding taxes) and such U.S. Holder’s adjusted tax basis in the shares of our Class A Common Stock surrendered pursuant to the Merger. Such gain or loss generally will be capital gain or loss and will be long-term capital gain or loss if such U.S. Holder’s holding period in such shares is more than one year at the time of the consummation of the Merger. A reduced tax rate on capital gain generally will apply to long-term capital gain of a non-corporate U.S. Holder. There are limitations on the deductibility of capital losses. A Non-U.S. Holder (as defined below under the section entitled “The Merger—Material U.S. Federal Income Tax Consequences of the Merger to Holders of Class A Common Stock” of this proxy statement) generally will not be subject to U.S. federal income tax with respect to the exchange of our Class A Common Stock for cash in the Merger unless such Non-U.S. Holder has certain connections to the United States. We recommend that you consult your tax advisor to determine the U.S. federal income tax consequences relating to the Merger in light of your own particular circumstances as well as any consequences arising under the laws of any state, local, or foreign taxing jurisdiction or other tax laws. A discussion of material U.S. federal income tax consequences of the Merger to holders of Class A Common Stock is provided under “The Merger—Material U.S. Federal Income Tax Consequences of the Merger to Holders of Class A Common Stock.”

What will the holders of RSU awards and PSU awards receive in the Merger?

Under the Merger Agreement, except as otherwise agreed upon in writing between the applicable holder and Parent prior to the Effective Time, effective as of immediately prior to the Effective Time, each Company RSU Award and Company PSU Award will be treated as follows:

 

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Each Vested Company RSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into the right to receive the RSU Consideration, payable as soon as practicable following the Closing.

 

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Each Unvested Company RSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into a Post-Closing Cash Award, equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Unvested Company RSU Award by (b) the Merger Consideration, and such Post-Closing Cash Award will vest and become payable pursuant to the same vesting schedule applicable to the Unvested Company RSU Award from which it was converted (including any accelerated vesting terms), subject to the holder’s continued employment with Parent and its subsidiaries (including the Surviving Corporation) through the applicable vesting date

 

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Each Company TSR PSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into a Post-Closing Cash Award, if any, equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Company TSR PSU Award (with the Merger Consideration used to determine the Company’s percentile rank relative to the applicable peer groups and such performance-based goals deemed to be achieved based on such relative percentile rank as of the date of the Merger Agreement) by (b) the Merger Consideration, and such Post-Closing Cash Award will vest and become payable pursuant to the same time-vesting schedule applicable to the Company TSR PSU Award from which it was converted (including any accelerated vesting terms), subject to the holder’s continued employment with Parent and its subsidiaries (including the Surviving Corporation) through the applicable vesting date.

 

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Each Company GW PSU Award hat remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into a Post-Closing Cash Award, if any, equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Company GW PSU Award (with any per share stock price performance-based goals deemed to be achieved based on the Merger Consideration) by (b) the Merger Consideration, and such Post-Closing Cash Award will vest and become payable pursuant to the same time-vesting schedule and based on the achievement of the same installed solar capacity goals applicable to the Company GW PSU Award from which it was converted (including any accelerated vesting terms), subject to the holder’s continued employment with Parent and its subsidiaries (including the Surviving Corporation) through the applicable vesting date.

 

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Each Company Stock Price PSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time for no consideration.

All amounts payable with respect to the Company RSU Awards and Company PSU Awards will be subject to deduction for any required tax withholding.

Am I entitled to appraisal rights instead of receiving the Merger Consideration for my shares of Class A Common Stock under the DGCL?

If the Merger is completed, holders of Class A Common Stock who continuously hold shares of Class A Common Stock through the Effective Time and who do not vote such shares in favor of the adoption of the Merger Agreement, and beneficial owners of shares of Class A Common Stock held either in voting trust or by a nominee on behalf of such person who beneficially own shares of Class A Common Stock through the Effective Time that are not voted in favor of the adoption of the Merger Agreement, and in either case who properly demand appraisal of their shares and do not withdraw their demands, and who otherwise comply with the applicable requirements of Section 262, will be entitled to seek appraisal of the fair value of their shares of Class A Common Stock in connection with the Merger under Section 262. Any appraisal amount determined by the court could be more than, the same as, or less than the value of the Merger Consideration. Any stockholder or beneficial owner intending to exercise appraisal rights must, among other things, submit a written demand for appraisal to the Company before the vote on the Merger Proposal and must not vote or otherwise submit a proxy in favor of the Merger Proposal. Failure to follow exactly the procedures and requirements specified under the DGCL will result in the loss of appraisal rights. The discussion of appraisal rights contained in this proxy statement is not a complete statement of the law pertaining to appraisal rights under the DGCL and is qualified in its entirety by the full text of Section 262, which is attached to this proxy statement as Appendix B and may be accessed without subscription or cost at the following publicly available website: https://delcode.delaware.gov/title8/c001/sc09/index.html#262. Because of the complexity of the DGCL relating to appraisal rights, if you are considering exercising your appraisal rights we encourage you to seek the advice of your own legal counsel. See the section entitled “The Merger—Appraisal Rights” of this proxy statement.

Special Meeting Information

How can I attend the Special Meeting?

You are entitled to attend the Special Meeting if you were a stockholder of the Company as of the close of business on   , 2025 (the “Record Date”) or if you hold a valid proxy for the Special Meeting. A list of stockholders of record will be available for inspection at the Special Meeting and for a period of 10 calendar days prior to the Special Meeting at our principal place of business during regular office hours, which is located at 2200 Atlantic Street, Sixth Floor, Stamford, CT 06902.

 

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The Special Meeting will be a completely virtual meeting of stockholders, which will be conducted via live webcast. You will be able to attend the Special Meeting online and submit your questions during the meeting by visiting https://www.cstproxy.com/altuspower/sm2025. You also will be able to vote your shares electronically at the Special Meeting.

To participate in the Special Meeting, you will need the 16-digit control number included on your proxy card or on the instructions that accompanied your proxy materials.

The meeting webcast will begin promptly at  a.m. EDT on   , 2025. We encourage you to access the meeting prior to the start time. Online check-in will begin at  a.m. EDT, and you should allow ample time for the check-in procedures.

What am I being asked to vote on at the Special Meeting?

 

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To adopt the Merger Agreement and approve the Transactions, which we refer to as the Merger Proposal; and

 

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To approve the adjournment of the Special Meeting to a later date or dates, if necessary or appropriate, including to solicit additional proxies if there are insufficient votes to approve the Merger Proposal at the time of the Special Meeting, which we refer to as the Adjournment Proposal.

Will any other business be conducted at the Special Meeting?

We know of no other business that will be presented at the Special Meeting. If any other matter properly comes before the stockholders for a vote at the Special Meeting, however, the proxy holders named on the Company’s proxy card will vote your shares in accordance with their best judgment.

What if during the check-in time or during the meeting I have technical difficulties or trouble accessing the virtual meeting website?

If you encounter any difficulties while accessing the virtual meeting during the check-in or meeting time, a technical assistance phone number will be made available on the virtual meeting registration page at least 15 minutes prior to the start of the meeting.

How many shares must be present or represented to conduct business at the Special Meeting?

A quorum must be present at the Special Meeting for any business to be conducted. The presence at the Special Meeting, by remote communication or represented by proxy, of the holders of a majority in voting power of the shares of Class A Common Stock issued and outstanding and entitled to vote in accordance with the DGCL on the Record Date will constitute a quorum. If a quorum is not present at the scheduled time of the Special Meeting, the chairperson of the Special Meeting may adjourn the Special Meeting.

Broker non-votes, if any, and abstentions will be counted as present for purposes of determining the existence of a quorum. We do not expect any broker non-votes at the Special Meeting because the proposals in this proxy statement are all non-routine matters. Therefore, if you hold your shares in “street name,” the failure to instruct your broker, bank, or other nominee on how to vote your shares of Class A Common Stock will result in such shares not being counted for purposes of determining the presence of a quorum.

What are broker non-votes and do they count for determining a quorum?

Under applicable stock exchange rules, brokers, banks, or other nominees have the discretion to vote your shares on certain “routine” matters if you fail to instruct your broker, bank, or other nominee on how to vote your shares

 

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with respect to such matters. A “broker non-vote” results when brokers, banks, or other nominees return a valid proxy voting upon a matter or matters for which the applicable stock exchange rules provide discretionary authority but do not vote on a particular proposal because they do not have discretionary authority to vote on such proposal and have not received specific voting instructions from the beneficial owner. We do not expect any broker non-votes at the Special Meeting because the proposals in this proxy statement are all non-routine matters. Broker non-votes, if any, will be counted as present for purposes of determining a quorum at the Special Meeting. Additionally, broker non-votes, if any, will have the same effect as a vote “AGAINST” the Merger Proposal, but will not have an effect on the outcome of the Adjournment Proposal.

Voting Information

Who is entitled to vote at the Special Meeting?

Stockholders of record as of the close of business on   , 2025, the Record Date, are entitled to cast one vote per share of Class A Common Stock on all items being voted on at the Special Meeting. You may vote all shares owned by you as of that time, including (a) shares held directly in your name as the stockholder of record, and (b) shares held for you as the beneficial owner through a broker, bank, or other nominee. At the close of business on the Record Date, there were     shares of Class A Common Stock outstanding and entitled to vote in accordance with the DGCL at the Special Meeting.

What vote is required to approve the Merger Proposal?

The approval of the Merger Proposal requires the affirmative vote of the holders of at least a majority of our Class A Common Stock outstanding and entitled to vote in accordance with the DGCL as of the close of business on the Record Date. The failure to vote your shares or a broker non-vote, if any, will have the same effect as a vote “AGAINST” the Merger Proposal.

What vote is required to approve the Adjournment Proposal?

The approval of the Adjournment Proposal requires the affirmative vote of the majority of the Company’s shares present electronically or represented by proxy at the meeting and entitled to vote at the Special Meeting. Abstention from voting your shares will have the same effect as a vote “AGAINST” the Adjournment Proposal.

What is an abstention and how will abstentions be treated?

An “abstention” represents a stockholder’s affirmative choice to decline to vote on a proposal. Abstentions are counted as present and entitled to vote for purposes of determining a quorum at the Special Meeting. Abstentions will have the same effect as votes “AGAINST” the Merger Proposal and the Adjournment Proposal. Broker non-votes, if any, are not considered to be entitled to vote and, accordingly, will not affect the outcome of the Adjournment Proposal. However, we do not expect any broker non-votes at the Special Meeting because the proposals in this proxy statement are all non-routine matters.

How does the Board recommend that I vote?

The Board, after considering the various factors described under the section entitled “The Merger—Recommendation of the Board and Reasons for the Merger” of this proxy statement, unanimously determined that the Merger Agreement and the Transactions are advisable, fair to, and in the best interests of the Company and its stockholders, approved the Merger Agreement and the Transactions, and directed that the Merger Agreement be submitted to our stockholders for their adoption.

The Board recommends that you vote “FOR” the Merger Proposal and “FOR” the Adjournment Proposal.

 

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How do I vote?

Even if you plan to attend the virtual Special Meeting online, we recommend that you vote by proxy as described below so that your vote will be counted if you later decide not to participate in the Special Meeting.

There are three ways to submit your proxy:

 

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By Internet. Go to https://www.cstproxyvote.com/ and follow the instructions there. You will need the 16-digit number included on your proxy card, voting instruction form, or notice. Votes submitted via the Internet must be received by 11:59 p.m. EDT on   , 2025.

 

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By Telephone. Dial the phone number on your proxy card. You will need the 16-digit number included on your proxy card, voting instruction form, or notice. Telephone voting for stockholders of record is available 24 hours a day. Votes submitted by telephone must be received by 11:59 p.m. EDT on   , 2025. If your shares are held in an account at a bank or brokerage firm that offers telephone voting options, they will provide you with a voting instruction form that includes instructions on how to vote your shares by telephone by the deadline specified on the voting instruction form.

 

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By Mail. If you received a paper copy of a proxy card or voting instruction form, you may submit your proxy by completing, signing, and dating the proxy card or voting instruction form and mailing it in the accompanying pre-addressed envelope. To ensure they are voted at the Special Meeting, proxies submitted by mail must be received at the address provided no later than   , 2025, the last business day before the meeting.

Internet and telephone voting facilities will be available 24 hours a day and will close at 11:59 p.m. EDT, on   , 2025.

You can also vote by attending the virtual Special Meeting online and voting electronically. You will need the 16-digit control number included on your proxy card or on the instructions that accompanied your proxy materials. This control number is designed to verify your identity and allow you to vote your shares of Class A Common Stock at the Special Meeting or to vote by proxy prior to the Special Meeting.

Even if you plan to attend the Special Meeting online, you are strongly encouraged to vote your shares of Class A Common Stock by proxy as soon as possible.

What is the difference between being a “record holder” and holding shares in “street name” as a beneficial owner?

A record holder holds shares in their own name, and such shares are registered with our transfer agent, Continental Stock Trust & Transfer Company. Shares held in “street name” means that the shares are held in the name of a broker, bank, or other nominee on a person’s behalf. If your shares are held in “street name” you are considered the “beneficial owner” of those shares. As the beneficial owner, you have the right to direct your broker, bank, or other nominee how to vote. You may also vote your shares electronically during the Special Meeting. Most of our stockholders are beneficial owners who hold their shares in street name rather than directly in their own name.

Am I entitled to vote if my shares are held in “street name”?

Yes. If you are a beneficial owner whose shares are held in street name you have the right to direct your broker, bank, or other nominee how to vote your shares, and the nominee is required to vote your shares in accordance with your instructions. You may also vote your shares electronically during the Special Meeting by attending the virtual Special Meeting online and voting your shares at that time.

 

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Will my shares of Class A Common Stock held in “street name” or another form of record ownership be combined for voting purposes with shares I hold as the stockholder of record?

No. Because any shares of Class A Common Stock you may hold in “street name” will be deemed to be held by a different stockholder than any shares of Class A Common Stock you hold as the stockholder of record, any shares of Class A Common Stock held in “street name” will not be combined for voting purposes with shares of Class A Common Stock you hold as the stockholder of record. Similarly, if you own shares of Class A Common Stock in various registered forms, such as jointly with your spouse, as trustee of a trust, or as custodian for a minor, you will receive, and will need to sign and return, a separate proxy card for those shares of Class A Common Stock because they are held in a different form of record ownership. Shares of Class A Common Stock held by a corporation or business entity must be voted by an authorized officer of the entity. Shares of Class A Common Stock held in an individual retirement account must be voted under the rules governing the account.

If I hold my shares of Class A Common Stock in “street name,” will my broker, bank, or other nominee vote my shares for me on the proposals to be considered at the Special Meeting?

Not without your direction. Your broker, bank, or other nominee is permitted to vote your shares of Class A Common Stock on “non-routine” proposals only if you instruct such broker, bank, or nominee on how to vote. Each of the proposals in this proxy statement are non-routine matters, and therefore brokers, banks, and other nominees cannot vote on these proposals without your instructions. Therefore, it is important that you instruct your broker, bank, or other nominee on how you wish to vote your shares.

You should follow the procedures provided by your broker, bank, or other nominee to instruct them, as applicable, to vote your shares of Class A Common Stock. Without such instructions, your shares will not be voted at the Special Meeting, which will have the same effect as a vote “AGAINST” the Merger Proposal, but will not have an effect on the outcome of the Adjournment Proposal.

What happens if I do not vote?

The required vote to approve the Merger Proposal is based on the total number of shares of Class A Common Stock outstanding and entitled to vote in accordance with the DGCL as of the close of business on the Record Date, not just the shares that are voted at the Special Meeting. If you do not vote, it will have the same effect as a vote “AGAINST” the Merger Proposal.

The failure to vote your shares will not have an effect on the outcome of the Adjournment Proposal.

Can I change my vote after I have mailed my signed proxy card or otherwise submitted my vote by proxy?

Yes. If you are the stockholder of record, you may change your vote by: (1) granting a new proxy bearing a later date (which automatically revokes the earlier proxy); (2) providing a written notice of revocation to the Secretary at our offices at Altus Power, Inc., 2200 Atlantic Street, Sixth Floor, Stamford, CT 06902, prior to your shares being voted at the Special Meeting; or (3) attending the virtual Special Meeting online and voting your shares electronically during the Special Meeting. Participation in the Special Meeting will not cause your previously granted proxy to be revoked unless you specifically make that request or affirmatively vote your shares at the Special Meeting.

For shares you hold beneficially in the name of a broker, bank, or other nominee, you may change your vote by submitting new voting instructions to your broker, bank, or other nominee, or by attending the virtual Special Meeting online and electronically voting your shares during the Special Meeting.

What is the deadline for voting my shares?

If you hold shares as the stockholder of record, your vote must be received before the polls close during the Special Meeting. Internet and telephone voting by proxy will close at 11:59 p.m. EDT, on   , 2025, the day before the Special Meeting.

 

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If you are the beneficial owner of shares held through a broker, bank, or other nominee, please follow the voting instructions provided by your broker, bank, or other nominee.

What is a proxy?

A proxy is your legal designation of another person, referred to as a “proxy,” to vote your shares of Class A Common Stock. The written document describing the matters to be considered and voted on at the Special Meeting is called a “proxy statement.” The document used to designate a proxy to vote your shares of Class A Common Stock is called a “proxy card.” The Board has designated Gregg Felton and Sophia Lee, each of them with full power of substitution, as proxies for the Special Meeting.

If a stockholder gives a proxy, how are the shares voted?

Regardless of the method you choose to vote, the individuals named on the enclosed proxy card, known as your proxies, will vote your shares in the way that you indicate. When completing the Internet or telephone process, or when filling out your proxy card, you may specify whether your shares should be voted “FOR” or “AGAINST” or to abstain from voting on all, some, or none of the specific items of business to come before the Special Meeting.

If you properly submit a proxy but do not indicate how your shares should be voted on a matter, the shares represented by your properly signed proxy card will be voted “FOR” each of the Merger Proposal and the Adjournment Proposal, in accordance with the recommendations of the Board.

Is my vote confidential?

Proxy instructions, ballots, and voting tabulations that identify individual stockholders are handled in a manner that protects your voting privacy. Your vote will not be disclosed, either within the Company or to third parties, except: (1) as necessary to meet applicable legal requirements; (2) to allow for the tabulation of the votes and certification of the votes; and (3) to facilitate a successful proxy solicitation. Occasionally, stockholders provide written comments on their proxy card, which are then forwarded to management.

Who will count the votes obtained at the Special Meeting?

A representative of Continental Stock Transfer & Trust Company, our inspector of election, will tabulate and certify the votes.

May I attend the Special Meeting and vote electronically?

The Special Meeting will be a completely virtual meeting of stockholders, which will be conducted via live webcast. You are entitled to participate in the virtual Special Meeting only if you were a stockholder as of the close of business on   , 2025, or if you hold a valid proxy for the Special Meeting. After consideration of the appropriate format of our Special Meeting, the Board chose a virtual meeting format for the Special Meeting in an effort to facilitate stockholder attendance and participation by enabling stockholders to participate fully, and equally, from any location around the world, at no cost. The virtual meeting format will allow our stockholders to engage with us at the Special Meeting from any geographic location, using any convenient Internet-connected devices, be it a phone, tablet, or computer. In addition, hosting a virtual Special Meeting reduces the costs and environmental impact of the Special Meeting.

You will be able to attend the Special Meeting online and submit your questions during the meeting by visiting https://www.cstproxy.com/altuspower/sm2025. You also will be able to vote your shares electronically at the Special Meeting.

To participate in the Special Meeting, you will need the 16-digit control number included on your proxy card or on the instructions that accompanied your proxy materials.

 

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The meeting webcast will begin promptly at  a.m. EDT on   , 2025. We encourage you to access the meeting prior to the start time. Online check-in will begin at  a.m. EDT, and you should allow ample time for the check-in procedures.

Where can I find the voting results of the Special Meeting?

We intend to publish the final results of the Special Meeting in a Current Report on Form 8-K that we will file with the SEC following the Special Meeting. All reports that we file with the SEC are publicly available when filed. See the section entitled “Where You Can Find More Information” of this proxy statement.

 

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THE SPECIAL MEETING

We are furnishing this proxy statement to the Company stockholders as part of the solicitation of proxies by the Board for use at the Special Meeting or any continuation, adjournment, or postponement thereof. This proxy statement provides the Company stockholders with the information they need to know to be able to vote or instruct their vote to be cast at the Special Meeting or any continuation, adjournment, or postponement thereof.

Date and Time of the Special Meeting

This proxy statement is being furnished to our stockholders as part of the solicitation of proxies by the Board for use at the Special Meeting to be held on   , 2025 at  a.m. EDT, or at any continuation, adjournment, or postponement thereof. The Special Meeting will be held virtually via live webcast at https://www.cstproxy.com/altuspower/sm2025. You will not be able to attend the Special Meeting in person.

Purpose of the Special Meeting

At the Special Meeting, we will ask our stockholders of record as of the Record Date to vote on the Merger Proposal and the Adjournment Proposal. If our holders of Class A Common Stock fail to adopt the Merger Agreement by approving the Merger Proposal, the Merger will not occur. A copy of the Merger Agreement is attached to this proxy statement as Appendix A, and the material provisions of the Merger Agreement are described under the section entitled “Proposal No. 1: The Merger Proposal” of this proxy statement.

This proxy statement and the enclosed form of proxy are first being mailed to our stockholders on or about   , 2025.

Record Date; Shares Entitled to Vote; Quorum

Only stockholders of record as of the close of business on   , 2025, the Record Date for the Special Meeting, are entitled to notice of and to vote at the Special Meeting or at any continuations, adjournments, or postponements thereof. A list of stockholders of record will be available in our office located at 2200 Atlantic Street, Sixth Floor, Stamford, CT 06902 during regular business hours for a period of at least 10 days before the Special Meeting and on the Special Meeting webpage during the meeting.

As of the Record Date, there were    shares of Class A Common Stock outstanding and entitled to vote in accordance with the DGCL at the Special Meeting.

A quorum of stockholders is necessary to transact business at the Special Meeting. Our Second Amended and Restated Bylaws (the “Bylaws”) provide that the presence at the Special Meeting, in person (which includes by remote communication) or represented by proxy, of the holders of a majority in voting power of the shares of our Class A Common Stock outstanding and entitled to vote in accordance with the DGCL at the meeting (    shares) will constitute a quorum for the Company to transact business at a Special Meeting. In general, shares of Class A Common Stock represented by a properly signed and returned proxy card will be counted as shares present and entitled to vote at the Special Meeting for purposes of determining a quorum. Shares represented by proxies received but marked “ABSTAIN” and broker non-votes, if any, will be included in the calculation of the number of shares considered to be present at the Special Meeting for purposes of determining a quorum.

In the event that a quorum is not present at the Special Meeting, it is expected that the meeting would be adjourned to a later date to solicit additional proxies, and a quorum will have to be established at such adjourned date.

 

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Vote Required; Abstentions and Broker Non-Votes

Each share of Class A Common Stock issued and outstanding as of the close of business on the Record Date is entitled to one vote at the Special Meeting.

The affirmative vote of the holders of at least a majority of the shares of Class A Common Stock outstanding and entitled to vote in accordance with the DGCL as of the close of business on the Record Date is required to approve the Merger Proposal. The failure to vote your shares, an abstention from voting your shares, or a broker non-vote, if any, will have the same effect as a vote “AGAINST” the Merger Proposal. Adoption of the Merger Agreement by our stockholders is a condition to the closing of the Merger.

The Adjournment Proposal requires the affirmative vote of the majority of the Company’s shares of Class A Common Stock present electronically or represented by proxy at the meeting and entitled to vote. The failure to vote your shares or a broker non-vote, if any, will not have an effect on the outcome of the Adjournment Proposal. Abstentions will have the same effect as votes against the Adjournment Proposal. Approval of the Adjournment Proposal is not a condition to completion of the Merger.

Shares Held by Directors and Executive Officers

As of the close of business on the Record Date, directors and executive officers of the Company and their affiliates beneficially owned and were entitled to vote, in the aggregate,    shares of Class A Common Stock, which represented approximately % of the shares of Class A Common Stock that would have been entitled to vote at the Special Meeting if held as of that date. Our directors and executive officers have informed us that they currently intend to vote all of their shares of Class A Common Stock (a) “FOR” the Merger Proposal and (b) “FOR” the Adjournment Proposal, although only those directors and executive officers who are Supporting Stockholders are obligated to do so.

Shares Held by the Supporting Stockholders

The Supporting Stockholders, which collectively owned approximately 40% of Class A Common Stock as of February 5, 2025, entered into Company Support Agreements with Parent and the Company. Pursuant to the Company Support Agreements, the Supporting Stockholders have agreed, among other things, to vote their shares of Class A Common Stock in favor of the Merger and the adoption of the Merger Agreement and against any Acquisition Proposal so long as (a) the Merger Agreement has not been terminated, (b) the Board of Directors has not made an Adverse Recommendation Change, (c) the Merger Agreement has not been amended or modified (including the waiver of any provision thereof) in a way that reduces or modifies the form of consideration payable to with respect to the securities of the Company, or imposes material restrictions or constraints on the payment of such consideration or is adverse to the Supporting Stockholders relative to the other stockholders of the Company, and (d) the Company Support Agreement has not been otherwise terminated by consent of all parties thereto. For more information, see the section of this proxy statement captioned “Proposal 1: The Merger Proposal—The Company Support Agreements.”

Voting; Proxies

Attendance

All holders of shares of Class A Common Stock as of the close of business on the Record Date, including stockholders of record and beneficial owners of Class A Common Stock registered in the “street name” of a broker, bank, or other nominee, are invited to attend the virtual Special Meeting. You will be able to attend the Special Meeting online and submit your questions during the meeting by visiting https://www.cstproxy.com/altuspower/sm2025. You also will be able to vote your shares electronically at the Special Meeting.

 

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To participate in the Special Meeting, you will need the 16-digit control number included on your proxy card or on the instructions that accompanied your proxy materials.

The meeting webcast will begin promptly at  a.m. EDT on   , 2025. We encourage you to access the meeting prior to the start time. Online check-in will begin at  a.m. EDT, and you should allow ample time for the check-in procedures.

Providing Voting Instructions by Proxy

To ensure that your shares of Class A Common Stock are voted at the Special Meeting, we recommend that you provide voting instructions by proxy as soon as possible, whether or not you plan to attend the Special Meeting online.

Shares of Class A Common Stock Held by a Record Holder

If you are a stockholder of record and your shares of Class A Common Stock are registered in your name with our transfer agent, Continental Stock Trust & Transfer Company, you may provide voting instructions by proxy using one of the methods described below.

Submit a Proxy by Telephone or via the Internet. This proxy statement is accompanied by a proxy card with instructions for submitting voting instructions. You may vote by telephone by calling the toll-free number or via the Internet by accessing the Internet address as specified on the enclosed proxy card. Your shares of Class A Common Stock will be voted as you direct in the same manner as if you had completed, signed, dated, and returned your proxy card, as described below. You must have the enclosed proxy card available, and follow the instructions on the proxy card, in order to submit a proxy electronically over the Internet or by telephone.

Submit a Proxy Card. If you complete, sign, date, and return the enclosed proxy card by mail so that it is received in time for the Special Meeting, your shares of Class A Common Stock will be voted in the manner directed by you on your proxy card.

Voting instructions are included on your proxy card. All shares represented by properly executed proxies received in time for the Special Meeting will be voted at the Special Meeting in accordance with the instructions of the stockholder. If you sign, date, and return your proxy card without indicating how you wish to vote, your proxy will be voted “FOR” each of the Merger Proposal and the Adjournment Proposal, if necessary or appropriate, including to solicit additional proxies if there are insufficient votes to approve the Merger Proposal at the time of the Special Meeting. The failure to vote your shares or an abstention from voting your shares will have the same effect as a vote “AGAINST” the Merger Proposal, and an abstention from voting your shares will also have the same effect as a vote “AGAINST” the Adjournment Proposal. Failure to vote your shares will not have an effect on the outcome of the Adjournment Proposal.

Shares of Class A Common Stock Held in “Street Name”

If your shares of Class A Common Stock are held in “street name” through a broker, bank, or other nominee, your broker, bank, or other nominee will send you instructions as to how to provide voting instructions for your shares. You may vote through your broker, bank, or other nominee by completing and returning the voting form provided by your broker, bank, or other nominee, or over the Internet, or by telephone through your broker, bank, or other nominee if such a service is provided by them to you. To vote via the Internet or telephone through your broker, bank, or other nominee, you should follow the instructions on the voting form provided by your broker, bank, or other nominee.

The failure to vote your shares, an abstention from voting your shares, or a broker non-vote, if any, will have the same effect as a vote “AGAINST” the Merger Proposal, and an abstention from voting your shares will also have the same effect as a vote “AGAINST” the Adjournment Proposal. Failure to vote your shares or a broker non-vote, if any, will not have an effect on the outcome of the Adjournment Proposal.

 

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Revocability of Proxies

Any person giving a proxy pursuant to this solicitation has the power to revoke it or change it any time before it is voted at the Special Meeting. If you are a stockholder of record, you may change your vote or revoke your proxy at any time before it is voted at the Special Meeting by:

 

•

granting a new proxy bearing a later date (which automatically revokes the earlier proxy) and returning it to us prior to the Special Meeting;

 

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submitting a new proxy electronically over the Internet or by telephone after the date of the earlier submitted proxy;

 

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providing a written notice of revocation to the Secretary at our offices at Altus Power, Inc., 2200 Atlantic Street, Sixth Floor, Stamford, CT 06902, prior to your shares being voted; or

 

•

attending the virtual Special Meeting online and voting your shares electronically during the Special Meeting.

Please note, however, that only your last-dated proxy will count. Participating in the Special Meeting without taking one of the actions described above will not in itself revoke your proxy. Please note that if you want to revoke your proxy by mailing a new proxy card to the Company or by sending a written notice of revocation to the Company, you should ensure that you send your new proxy card or written notice of revocation in sufficient time for it to be received by the Company before the Special Meeting. Please note that to be effective, your new proxy card, Internet, or telephonic voting instructions or written notice of revocation must be received by our Secretary prior to the Special Meeting and, in the case of Internet or telephonic voting instructions, must be received before 11:59 p.m. EDT on   , 2025.

If you hold your shares of Class A Common Stock in “street name,” you should contact your broker, bank, or other nominee for instructions regarding how to change your vote or submit new voting instructions. Any continuation, adjournment, or postponement of the Special Meeting for the purpose of soliciting additional proxies will allow the Company stockholders who have already sent in their proxies to revoke them at any time prior to their use at the Special Meeting, as continued, adjourned, or postponed.

Abstentions

An abstention occurs when a stockholder attends a meeting, either by remote communication or represented by proxy, but abstains from voting. Abstentions will be included in the calculation of the number of shares of Class A Common Stock represented at the Special Meeting for purposes of determining whether a quorum has been achieved. Abstaining from voting will have the same effect as a vote “AGAINST” the Merger Proposal and the Adjournment Proposal.

Adjournments and Postponements

Although it is not currently expected, subject to certain restrictions in the Merger Agreement, the Special Meeting may be continued, adjourned, or postponed for the purpose of soliciting additional proxies. Under our Bylaws, the Special Meeting may be postponed by action of the Board at any time in advance of the meeting, or may be adjourned by the chairperson of the Special Meeting if a quorum is not present. If the Board fixes a new record date for the adjourned meeting, or if the adjournment is for more than 30 days, a notice of the adjourned meeting will be given to each stockholder of record entitled to vote at the adjourned meeting as of such new record date. If the Special Meeting is continued, adjourned, or postponed to solicit additional proxies, stockholders who have already submitted their proxies will be able to revoke them at any time prior to their use at the Special Meeting as so continued, adjourned, or postponed.

In the event that there is present at the Special Meeting, in person (which includes by remote communication) or represented by proxy, sufficient favorable voting power to secure the vote of our stockholders necessary to adopt the Merger Agreement by approving the Merger Proposal, we do not anticipate that we will adjourn or postpone the Special Meeting.

 

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Board Recommendation

The Board, after considering various factors described under the section entitled “The Merger—Recommendation of the Board and Reasons for the Merger” of this proxy statement, unanimously determined that the Merger Agreement and the Transactions are advisable, fair to, and in the best interests of the Company and its stockholders, approved the Merger Agreement and the Transactions, and directed that the Merger Agreement be submitted to the stockholders of the Company for their adoption.

The Board recommends that you vote “FOR” the Merger Proposal and “FOR” the Adjournment Proposal.

Solicitation of Proxies

The Board is soliciting your proxy, and we will bear the cost of this solicitation of proxies, including the preparation, assembly, and mailing of the proxies and soliciting material, as well as the charges and expenses of brokerage firms and others for forwarding solicitation material to beneficial owners of shares of Class A Common Stock.

Proxies may be solicited by mail, personal interview, e-mail, telephone, facsimile, or via the Internet, without additional compensation, by certain of the Company’s directors, officers, and employees.

Anticipated Date of Consummation of the Merger

We currently anticipate that the Merger will be consummated in the second quarter of 2025, assuming satisfaction or waiver of all of the conditions to the Merger. However, because the Merger is subject to certain conditions, it is possible that factors outside the control of the Company and Parent could result in the Merger being consummated at a later time or not at all.

Appraisal Rights

If the Merger is consummated, stockholders who continuously hold shares of Class A Common Stock through the Effective Time, who do not vote in favor of the Merger (whether by voting against the Merger, abstaining, or otherwise not voting with respect to the Merger), who properly demand an appraisal of their shares, who continuously hold (in the case of holders of record) or continuously own (in the case of beneficial owners) their shares of Company Shares through the effective date of the Merger, who otherwise comply with the statutory requirements of Section 262, and who do not withdraw their demands or otherwise lose their rights to appraisal, subject to the conditions thereof will be entitled to seek appraisal of the fair value of their shares in connection with the Merger under Section 262. This means that holders of shares of Class A Common Stock who perfect their appraisal rights, who do not thereafter withdraw their demand for appraisal, and who follow the procedures in the manner prescribed by Section 262 may be entitled to have their shares appraised by the Delaware Court of Chancery and to receive payment in cash of the “fair value” of their shares of Class A Common Stock, exclusive of any elements of value arising from the accomplishment or expectation of the Merger, as determined by the Delaware Court of Chancery, together with interest to be paid on the amount determined to be fair value, if any (or in certain circumstances described in further detail in the section of this proxy statement captioned “The Merger—Appraisal Rights,” on the difference between the amount determined to be the fair value and the amount paid by the Surviving Corporation in the Merger to each stockholder entitled to appraisal prior to the entry of judgment in any appraisal proceeding). Due to the complexity of the appraisal process, stockholders who wish to seek appraisal of their shares are encouraged to review Section 262 carefully and to seek the advice of legal counsel with respect to the exercise of appraisal rights.

 

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Stockholders considering seeking appraisal should be aware that the fair value of their shares as determined pursuant to Section 262 could be more than, the same as, or less than the value of the consideration that they would receive pursuant to the Merger Agreement if they did not seek appraisal of their shares.

To exercise your appraisal rights, you must: (a) submit a written demand for appraisal to Altus Power before the vote is taken on the adoption of the Merger Agreement; (b) not submit a proxy or otherwise vote in favor of the proposal to adopt the Merger Agreement; (c) continue to hold your shares of Class A Common Stock of record through the Effective Time; and (d) strictly comply with all other procedures for exercising appraisal rights under Section 262. Your failure to follow exactly the procedures specified under Section 262 may result in the loss of your appraisal rights. In addition, the Delaware Court of Chancery will dismiss appraisal proceedings in respect of the Merger unless certain stock ownership conditions are satisfied by the stockholders seeking appraisal. The DGCL requirements for exercising appraisal rights are described in further detail in the section of this proxy statement captioned “The Merger—Appraisal Rights,” which is qualified in its entirety by Section 262, the relevant section of the DGCL regarding appraisal rights. A copy of Section 262 is reproduced and attached as Annex B to this proxy statement and incorporated herein by reference. If you hold your shares of Class A Common Stock through a broker, bank, or other nominee and you wish to exercise appraisal rights, you should consult with your broker, bank, or other nominee to determine the appropriate procedures for the making of a demand for appraisal by such broker, bank, or nominee.

Delisting and Deregistration of Class A Common Stock

If the Merger is completed, the shares of Class A Common Stock will be delisted from the NYSE and deregistered under the Exchange Act, and shares of Class A Common Stock will no longer be publicly traded.

Other Matters

At this time, we know of no other matters to be voted on at the Special Meeting. If any other matters properly come before the Special Meeting, your shares of Class A Common Stock will be voted in accordance with the discretion of the appointed proxy holders.

Householding of Special Meeting Materials

Some brokers, banks, and other nominees may be participating in the practice of “householding” proxy statements and annual reports. This means that only one copy of this proxy statement for the Special Meeting may have been sent to multiple stockholders in each household. We will promptly deliver a separate copy of this proxy statement to any stockholder upon written or oral request to Continental at 917-262-2373 or in writing at Continental, Proxy Department, 1 State Street, 30th Floor, New York, New York 10004. All stockholders may also call us at the number below or write to us at the following address to request a separate copy of the proxy materials: Altus Power, Inc., Attention Sophia Lee, Corporate Secretary, 2200 Atlantic Street, 6th Floor, Stamford, CT 06902, telephone: (888) 882-5887. Any stockholder who wants to receive separate copies of this proxy statement or annual report to stockholders in the future, or any stockholder who is receiving multiple copies and would like to receive only one copy per household, should contact such stockholder’s broker, bank, or other nominee, or the stockholder may contact the Company at the above address and phone number.

 

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Questions and Additional Information

If you have any questions concerning the Merger, the Special Meeting, or this proxy statement, would like additional copies of this proxy statement, or need help voting your shares of Class A Common Stock, please contact our proxy solicitor:

SODALI & CO.

333 Ludlow Street, 5th Floor, South Tower

Stamford, Connecticut 06902

Toll-Free: (800) 662-5200

Banks and brokers call: (203) 658-9400

Email: [email protected]

 

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement, and the documents to which we refer you in this proxy statement, as well as information included in oral statements or other written statements made or to be made by us or on our behalf, contain certain information, including financial estimates and statements as to, among other things, the expected timing of the closing of the Transactions; any anticipated effects of the announcement, pendency, or completion of the Transactions on the value of the Class A Common Stock; the ability of the parties to obtain any required regulatory approvals in connection with the Transactions and to complete the Transactions considering the various closing conditions; the availability of debt and equity financing; the expected benefits of the Transactions; expenses related to the Transactions and any potential future costs; the Company’s future growth and financial results, business strategy, value provided to customers and patients, and competitive position; the Company’s plans with respect to the 2025 Annual Meeting of Stockholders, if any; and any assumptions underlying any of the foregoing, which may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act.

All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements, including statements containing the words “expect,” “anticipate,” “intend,” “aim,” “plan,” “believe,” “could,” “seek,” “see,” “should,” “will,” “may,” “would,” “might,” “considered,” “potential,” “predict,” “projection,” “estimate,” “forecast,” “continue,” “likely,” “target,” or similar expressions or the negatives of these words or other comparable terminology that convey uncertainty of future events or outcomes. The absence of such terminology does not mean that a statement is not forward-looking.

The forward-looking statements are based on the Company’s current plans and expectations and involve risks and uncertainties which are, in many instances, beyond its control, and which could cause actual results to differ materially from those included in or contemplated or implied by the forward-looking statements. Such risks and uncertainties include, among others:

 

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the possibility that any or all of the various conditions to the completion of the Transactions, including obtaining required stockholder and regulatory approvals, may not be satisfied or waived in a timely manner or at all;

 

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the ability of Parent to obtain the necessary financing arrangements set forth in the commitment letters received in connection with the Transactions;

 

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potential litigation relating to the Transactions that could be instituted against Parent, Merger Sub, the Company, or their respective directors, managers, or officers, including the effects of any outcomes related thereto;

 

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the risk that disruptions from the Transactions may harm the Company’s business, including current plans and operations;

 

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the ability of the Company to retain and hire key personnel;

 

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potential adverse reactions or changes to business relationships resulting from the announcement or completion of the Transactions;

 

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continued availability of capital and financing and rating agency actions;

 

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legislative, regulatory, and economic developments affecting the Company’s business;

 

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general economic and market developments and conditions;

 

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potential business uncertainty, including changes to existing business relationships, during the pendency of the Transactions that could affect the Company’s financial performance;

 

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certain restrictions during the pendency of the Transactions that may impact the Company’s ability to pursue certain business opportunities or strategic transactions;

 

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•

unpredictability and severity of catastrophic events, including but not limited to acts of terrorism, pandemics, outbreaks of war, or hostilities, as well as the Company’s response to any of the aforementioned factors;

 

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significant transaction costs associated with the Transactions;

 

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the possibility that the Transactions may be more expensive to complete than anticipated, including as a result of unexpected factors or events;

 

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the occurrence of any event, change, or other circumstance that could give rise to the termination of the Merger Agreement, including in circumstances requiring the Company to pay a termination fee or other expenses, including the failure to close the Transactions by November 5, 2025;

 

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the possibility that competing offers or acquisition proposals may be made in response to the announcement of the Transactions;

 

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the effect of the announcement or pendency of the Transactions on the Company’s Class A Common Stock prices and/or operating results and uncertainty as to the long-term value of Company’s Class A Common Stock;

 

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the possibility that the Transactions may not achieve some or all of any anticipated benefits with respect to the Company’s business and the Transactions may not be completed in accordance with our expected plans or at all; and

 

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the risks and uncertainties pertaining to the Company’s business, including those set forth in Part I, Item 1A of the Company’s most recent Annual Report on Form 10-K and Part II, Item 1A of the Company’s subsequent Quarterly Reports on Form 10-Q, as such risk factors may be amended, supplemented, or superseded from time to time by other reports filed by the Company with the SEC, copies of which are available free of charge on the Company’s website at https://investors.altuspower.com.

Consequently, all of the forward-looking statements we make in this proxy statement are qualified by the information contained or incorporated by reference herein, including, but not limited to, the information contained under this heading (see the section entitled “Where You Can Find More Information” of this proxy statement). No assurance can be given that these are all of the factors that could cause actual results to vary materially from the forward-looking statements.

Except as required by applicable law, we undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events, or otherwise. Stockholders are cautioned not to place undue reliance upon any of these forward-looking statements. Our stockholders are advised, however, to consult any future disclosures we make on related subjects as may be detailed in our other filings made from time to time with the SEC.

 

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MARKET PRICES

Our Class A Common Stock has been traded on the NYSE under the symbol “AMPS” since December 9, 2021. Prior to that time, there was no public market for our shares. The table below sets forth, for the periods indicated, the range of high and low closing prices per share of our Class A Common Stock as reported by the NYSE.

 

		High				Low
2025
1st Quarter		$	4.9200				3.2900
		High				Low
2024
4th Quarter		$	4.4380				2.7100
3rd Quarter		$	4.6000				2.7950
2nd Quarter		$	5.5000				3.4050
1st Quarter		$	7.2800				4.3100
		High				Low
2023
4th Quarter		$	7.0900				4.2350
3rd Quarter		$	6.6700				4.2850
2nd Quarter		$	7.4050				4.0800
1st Quarter		$	8.5800				5.1250
		High				Low
2022
4th Quarter		$	11.8200				6.1200
3rd Quarter		$	14.7150				5.8200
2nd Quarter		$	8.8800				4.2600
1st Quarter		$	10.7800				6.2450

As of the Record Date, there were    shares of Class A Common Stock outstanding, held by approximately    stockholders of record. The actual number of stockholders is considerably greater than this number of record holders and includes stockholders who are beneficial owners but whose shares are held in street name by brokers, banks, and other nominees. The Company had    shares of Class B common stock outstanding on the Record Date.

On February 4, 2025, the last trading day prior to the public announcement of the execution of the Merger Agreement, the closing price of our Class A Common Stock on the NYSE was $3.9600 per share. On   , 2025, the latest practicable trading day before the printing of this proxy statement, the closing price of our Class A Common Stock on the NYSE was $  per share. You are encouraged to obtain current market quotations for Class A Common Stock.

Our Class A Common Stock is currently registered under the Exchange Act. If the Merger is consummated, the Company will cease to be a publicly traded company and will become a wholly owned subsidiary of Parent, and the Class A Common Stock will be delisted from the NYSE and deregistered under the Exchange Act.

 

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THE MERGER

This discussion of the Merger does not purport to be complete and is qualified in its entirety by reference to the Merger Agreement, which is attached to this proxy statement as Appendix A and incorporated by reference into this proxy statement. You should read the entire Merger Agreement carefully as it is the legal document that governs the Merger.

Parties Involved in the Merger

Altus Power, Inc.

The Company is a Delaware corporation with principal executive offices located at 2200 Atlantic Street, Sixth Floor, Stamford, CT 06902, telephone number (203) 698-0090. The Company is a national full-service solar power company that provides clean electric power to businesses, towns, and homes, made from commercial-scale solar arrays that the Company owns and operates. Our Class A Common Stock is listed on the NYSE under the symbol “AMPS”. Additional information about the Company is contained in certain of its public filings that are incorporated by reference herein. See the section entitled “Where You Can Find More Information” of this proxy statement.

Avenger Parent, Inc.

Parent is a privately held Delaware corporation affiliated with TPG through the TPG Guarantor. Parent was formed in 2025 solely for the purpose of engaging in the Transactions. Parent has not carried on any activities on or prior to the date of this proxy statement, except for activities incidental to its formation and activities undertaken in connection with the Transactions. Parent’s principal executive offices are located at 301 Commerce Street, Suite 3300, Fort Worth, TX 76102, telephone number (817) 871-4000.

Avenger Merger Sub, Inc.

Merger Sub is a privately held Delaware corporation and a direct wholly owned subsidiary of Parent that was formed in 2025 solely for the purpose of engaging in the Transactions. Merger Sub has not carried on any activities on or prior to the date of this proxy statement, except for activities incidental to its formation and activities undertaken in connection with the Transactions. Upon the consummation of the Merger, Merger Sub will merge with and into the Company, and the separate corporate existence of Merger Sub will cease. Merger Sub’s principal executive offices are located at 301 Commerce Street, Suite 3300, Fort Worth, TX 76102, telephone number (817) 871-4000.

Certain Effects of the Merger on the Company

If the Merger Agreement is adopted by the Company stockholders and all other conditions to the closing of the Merger set forth in the Merger Agreement are either satisfied or waived, Merger Sub will merge with and into the Company, with the Company continuing as the Surviving Corporation.

Upon consummation of the Merger, at the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub, or the Company, or their respective stockholders, each share of Class A Common Stock issued and outstanding immediately prior to the Effective Time, including shares of Class A Common Stock issued upon conversion of shares of Class B Common Stock (but excluding any Canceled Shares, Dissenting Shares or Rollover Shares) will be automatically canceled and converted into the right to receive the Merger Consideration, without interest and minus any applicable withholding taxes. If the Merger is consummated, you will no longer own any shares of capital stock of the Company as of the Effective Time.

In connection with the Merger and pursuant to the terms of the Company Certificate, on the business day immediately prior to the Effective Time, each share of Class B Common Stock then issued and outstanding will be automatically converted into shares of Class A Common Stock in accordance with the terms of, and subject to

 

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the limitations set forth in, the Company Certificate, and upon such conversion, each such share of Class B Common Stock will automatically be canceled and will cease to exist, and each former holder of Class B Common Stock will thereafter cease to have any rights with respect to such securities.

Our Class A Common Stock is currently registered under the Exchange Act and is listed on the NYSE under the symbol “AMPS”. If the Merger is consummated, the Company will cease to be a publicly traded company and will become a wholly owned subsidiary of Parent, and our Class A Common Stock will be delisted from the NYSE and deregistered under the Exchange Act.

Effect on the Company if the Merger is Not Consummated

If the Merger Proposal is not approved by our stockholders or if the Merger is not consummated for any other reason, the Company stockholders will continue to hold their shares of Class A Common Stock and will not receive any payment for such shares. Instead, the Company will remain an independent publicly traded company, our Class A Common Stock will continue to be listed and traded on the NYSE and registered under the Exchange Act, and we will continue to file periodic reports with the SEC.

Furthermore, if the Merger is not consummated, and depending on the circumstances that would have caused the Merger not to be consummated, it is possible that the price of our Class A Common Stock may decline significantly. If that were to occur, it is uncertain when, if ever, the price of our Class A Common Stock would return to the price at which it trades as of the date of this proxy statement.

Accordingly, if the Merger is not consummated, there can be no assurance as to the effect of these risks and opportunities on the future value of your shares of Class A Common Stock. If the Merger is not consummated, the Board will continue to evaluate and review our business operations, assets, operating results, financial condition, prospects, and business strategy, among other things, and make such changes as are deemed appropriate and continue to seek to enhance stockholder value. If the Merger Agreement is not adopted by our stockholders or if the Merger is not consummated for any other reason, there can be no assurance that any other transaction acceptable to the Company will be offered or that our business, prospects, or results of operations will not be adversely impacted.

In addition, under specified circumstances, we may be required to pay Parent a termination fee or expense reimbursement upon the termination of the Merger Agreement, as described under the section entitled “Proposal No. 1: The Merger Proposal—Termination Fees” of this proxy statement.

Merger Consideration

Upon consummation of the Merger, at the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub, or the Company, or their respective stockholders, each share of Class A Common Stock issued and outstanding immediately prior to the Effective Time, including shares of Class A Common Stock issued upon conversion of shares of Class B Common Stock (but excluding any Canceled Shares, Dissenting Shares or Rollover Shares), will be automatically canceled and converted into the right to receive an amount in cash equal to $5.00, which we refer to as the Merger Consideration, without interest and minus any applicable withholding taxes. From and after the Effective Time, all of the shares of Class A Common Stock will no longer be outstanding and will automatically be canceled and retired and will cease to exist, and each holder of a Certificate and each holder of a Book-Entry Share, in each case, outstanding immediately prior to the Effective Time previously representing any such shares of Class A Common Stock will thereafter cease to have any rights with respect to such securities other than the right to receive, upon surrender of such Certificates and Book-Entry Shares, the Merger Consideration in accordance with the Merger Agreement, without interest. As described further under the section entitled “Proposal No. 1: The Merger Proposal—Payment for Class A Common Stock” of this proxy statement, at or prior to the Effective Time, Parent will deposit or cause to be deposited (a) with the Paying Agent, cash in an amount sufficient to pay the aggregate Merger Consideration

 

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required to be paid by the Paying Agent to the holders of Class A Common Stock in accordance with the Merger Agreement and (b) with the Company, cash in an amount sufficient to pay the aggregate RSU Consideration in accordance with the Merger Agreement. Promptly following the Effective Time and in any event no later than the second business day following the Effective Time, the Paying Agent will send each holder of Certificates or Book-Entry Shares, as applicable, a letter of transmittal instructing you to send your Certificates to the Paying Agent in order to receive the Merger Consideration, without interest and minus any applicable withholding taxes, for each share of Class A Common Stock represented by such Certificates or Book Entry Shares.

If any cash payment is to be made to a person other than the person in whose name the applicable surrendered Certificate or Book-Entry Share is registered, it will be a condition of such payment that the person requesting such payment will pay, or cause to be paid, any transfer taxes required by reason of the making of such cash payment to a person other than the registered holder of the surrendered Certificate or Book-Entry Share or will establish to the reasonable satisfaction of the Paying Agent that such taxes have been paid or are not payable.

After the Merger is consummated, under the terms of the Merger Agreement, you will have the right to receive the Merger Consideration (except with respect to Dissenting Shares), without interest and minus any applicable withholding taxes, but you will no longer have any rights as a Company stockholder as a result of the Merger (except with respect to Dissenting Shares), nor will you be entitled to receive any shares in Parent or the Surviving Corporation.

Background of the Merger

The terms of the Merger Agreement are the result of arm’s-length negotiations between representatives of the Company and TPG. The following is a summary of the material events leading to the signing of the Merger Agreement and key meetings, negotiations, discussions and actions among the Company, TPG and their respective advisors that preceded the execution of the Merger Agreement and public announcement of the transaction. This summary does not purport to describe every conversation or interaction among the parties or their representatives.

The Board and the management of the Company (“Company Management”) regularly evaluate the Company’s business, strategy, and financial plans and prospects. As part of this evaluation, the Board and Company Management, together with legal and financial advisors, also periodically consider strategic alternatives to attract growth capital and maximize value for the Company’s stockholders, including strategic transactions such as a strategic acquisition or a potential sale of the Company. In November 2023, Company Management had discussions with various investment banks, including Moelis, regarding the solar market and solar industry and the Company’s possible strategic alternatives. Company Management continued discussions with these banks to better understand their views of the industry and the Company’s position in the market, including trends and conditions affecting the Company and the solar industry; the Company’s business, competitive position and growth prospects; and the Company’s overall long-term strategic, operational and financial goals and ability to enhance stockholder value. In March 2024, Company Management had discussions with certain of these banks, including Moelis, regarding the possibility of assisting the Company in engaging in conversations with additional potential sources of capital, including with private capital investors.

During the period from April 30, 2024 to July 24, 2024, Company Management, in conjunction with the Board, undertook an in-depth review of the Company’s long-term plan. During this review, the Board provided instructions to Company Management with respect to updates to the Company’s long-term plan.

During the period from May 2024 to August 2024, at the direction of Company Management, Moelis contacted various private investment firms and strategic firms to discuss private capital-raising opportunities. Several of these firms expressed an interest in discussing various ways to partner with the Company, from supplying private capital to the Company to a potential strategic transaction involving the Company.

 

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On July 4, 2024, the Board discussed potential sources of private capital and the Company’s financial model. During the meeting, Sophia Lee, the Company’s Chief Legal Officer, made a presentation to the Board regarding the fiduciary duties of directors and other obligations of Board members in connection with a strategic review and potential sale process.

During the period from July 2024 through August 2024, Moelis introduced the Company to various potential counterparties with respect to a potential capital raise and strategic investment transactions. Following negotiations between the Company and each potential counterparty, the Company entered into customary confidentiality agreements with 29 potential counterparties (including TPG) that had expressed interest to either the Company or to Moelis in exploring such transactions. Following the entry into these confidentiality agreements, during that same time period, members of senior management of the Company (“Senior Management”) held initial exploratory meetings with the potential counterparties to discuss the Company’s business, financial position and prospects and to better understand the counterparties’ interest in a potential transaction involving the Company. Each of the confidentiality agreements entered into by the Company in connection with its evaluation of strategic alternatives included a customary standstill provision that expired upon the public announcement by the Company that it had entered into a definitive agreement in respect of a transaction involving the Company. Following execution of the confidentiality agreements, each party was provided due diligence materials and access to the virtual data room.

On July 24, 2024, the Board met to discuss the Company’s strategic plan, including strategic alternatives available to the Company, merger and acquisition activity in the Company’s industry, perceived liquidity in capital markets and appropriate timing for the Company to explore strategic transactions, including a potential sale process. At the end of the meeting, the Board unanimously resolved to initiate a formal process to explore, review and evaluate strategic alternatives that might be available to the Company.

On August 5, 2024, the Board reviewed the Company’s financial model that was to be provided in a virtual data room available to potential counterparties and delegated independent directors Christine Detrick and Richard Peretz with responsibility to interview bankers to potentially be engaged by the Company to assist in exploring a strategic transaction. The Board delegated this authority to Ms. Detrick and Mr. Peretz for efficiency and not because of any actual or potential conflicts of interest involving any member of the Board.

On August 13, 14 and 15, 2024, Ms. Detrick, Mr. Peretz, and certain members of Senior Management interviewed several investment banks, including Moelis.

On August 20, 2024, Ms. Detrick, Mr. Peretz, and certain members of Senior Management held meetings via videoconference with Moelis and another investment bank regarding their respective proposed terms for an engagement with the Company.

On August 22, 2024, the Board discussed the selection of a financial advisor for the Company in connection with the proposed transaction. Following the discussion, the Board selected Moelis as financial advisor for the Company due to Moelis’s experience in transactions similar to the proposed transaction, its reputation in the investment community, and its familiarity with the Company and its business. The Board approved signing an engagement letter with Moelis, and subsequently Moelis was engaged as the Company’s financial advisor to assist the Company in exploring potential counterparties to engage in a potential strategic transaction with the Company.

On September 4, 2024, the Board held a meeting by videoconference, with members of Senior Management, to discuss initiating a review of strategic alternatives to enhance stockholder value, including a potential sale of the Company, and formation of a transaction committee of the Board (the “Transaction Committee”). The purpose of the Transaction Committee was to assist the Board in evaluating the Company’s long-term strategic plan and strategies, oversee the review and evaluation of any potential strategic transaction involving the Company and, if deemed desirable, oversee the negotiation of the terms and conditions of one or more strategic transactions on behalf of the Company, should the Board determine to evaluate any such potential strategic transactions. The

 

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Transaction Committee was formed for convenience and efficiency and not because of any actual or potential conflicts of interest involving any member of the Board; the authority to approve any potential strategic transaction remained with the Board. Following discussion, the Board unanimously resolved to approve the creation of the Transaction Committee, which was composed of Ms. Detrick and Mr. Peretz. The Board also approved the Company’s financial model to be posted to the virtual data room available to potential counterparties.

On September 12, 2024, the Board formalized the creation of the Transaction Committee by unanimous written consent and tasked the Transaction Committee with interviewing outside legal counsel, including Latham & Watkins LLP (“Latham”), for the strategic review of a potential transaction.

On September 16, 2024, the Transaction Committee held a meeting by videoconference, with members of Senior Management, to discuss retaining outside legal counsel for any potential transaction.

On September 24, 2024, the Transaction Committee held a meeting by videoconference with representatives of Moelis and members of Senior Management to discuss the potential transaction process.

Also on September 24, 2024, the Board met by videoconference, with members of Senior Management in attendance. The Board selected Latham as counsel to the Company in connection with the evaluation of potential strategic alternatives on the basis of Latham’s expertise advising companies in the renewable energy industry and its expertise in mergers and acquisitions and approved the engagement of Latham as outside legal counsel to the Company for the potential transaction. The Board approved the Phase 1 process letter to be posted to the virtual data room for potential counterparties and affirmed the Board’s prior approval of uploading the financial model to the virtual data room for potential counterparties.

On September 24, 2024, Moelis posted the Phase 1 process letter to the virtual data room for potential counterparties. The process letter stated that preliminary indications of interest in a strategic transaction involving the Company should be submitted by October 21, 2024. The process letter did not discuss any of the potential terms of continued employment for Company Management or the possibility that current stockholders of the Company may be asked to roll over their equity interests into the surviving entity after the completion of a business combination, because the Board had instructed Company Management and the stockholders with Board representation not to engage in discussions with potential bidders regarding those topics until the Board could conclude that the transaction consideration and other material terms of the proposed transaction had been agreed by the parties. During the first phase of the process, the Company made available business, financial and legal due diligence materials to the potential counterparties and their respective representatives, including the financial model. The Company also regularly answered selected due diligence requests and follow-up questions from potential counterparties. Additionally, Company Management conducted meetings with 19 potential counterparties to discuss the Company’s business, financial information, and prospects, as well as follow-up due diligence calls and meetings upon request with eight potential counterparties.

On October 11, 2024, the Transaction Committee held a meeting by videoconference with representatives of Moelis and members of Senior Management in attendance to discuss the potential transaction process.

On October 15, 2024, the Company issued a press release announcing that its Board was conducting an ongoing formal review of strategic alternatives, the goal of which was to assess and determine potential strategic alternatives to unlock shareholder value and optimize access to capital for the Company.

Between October 21 and 24, 2024, seven potential counterparties submitted written, non-binding expressions of interest to purchase all of the outstanding shares of common stock of the Company through merger or other business combination. One counterparty submitted an oral, non-binding expression of interest, which was conditioned upon entering into an exclusive process with the Company. In each written proposal, the potential counterparty indicated confidence in its ability to obtain the necessary financing to consummate a transaction but

 

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did not otherwise provide financing commitments or other details as to how a transaction would be financed. In addition, each proposal from potential counterparties was subject to further due diligence review of the Company.

During October 2024, Company Management and representatives of Moelis held meetings via videoconference with representatives of the potential counterparties that had submitted non-binding expressions of interest, including TPG, to understand further their interest in pursuing a potential strategic transaction with the Company including the proposed terms of, and the manner in which such potential counterparties intended to finance, any such potential transaction.

On October 25, 2024, the Transaction Committee held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management in attendance, to discuss the terms of the non-binding expressions of interest submitted to the Company during the first round of the transaction process. During the meeting, Moelis reviewed the steps taken to date in connection with the strategic review being conducted by the Company as well as feedback received to date from the potential counterparties that had submitted non-binding expressions of interest, including TPG. The Transaction Committee discussed the areas of opportunity relating to the business that were identified by these potential counterparties and the key challenges that had been discussed between the Company and these potential counterparties during the first phase of the process, as well as the reasons that participants in the process who had elected not to submit an acquisition proposal gave for withdrawing from the process, to the extent any reasons were given. Moelis also presented certain preliminary financial information and data regarding the Company and the indications of interest. Following discussion with the financial advisors and Company Management, the Transaction Committee agreed to present all eight non-binding expressions of interest (written and oral) for the Board’s consideration, and to recommend that the Board invite the four potential counterparties offering the highest price per share (provided the Board believed they were capable of financing and executing a potential transaction at the offered price per share) to move forward to the next stage of the process. The Transaction Committee also evaluated the possibility of contacting other potential strategic counterparties, including competitors of the Company. Following discussion, the Transaction Committee determined not to affirmatively contact additional strategic counterparties. In making this determination, the Transaction Committee took into account (a) the fact that no strategic counterparty had contacted the Company or its financial advisors despite the Company’s October 15 press release publicly announcing the strategic review process and several other media reports speculating regarding the ongoing strategic review process, (b) the low likelihood that strategic counterparties would engage if contacted, based on the lack of expressed interest from strategic counterparties whom Moelis had contacted previously, and (c) the potential harm to the success of the ongoing process and to the business of the Company if other strategic counterparties were involved, including the risk (i) of confidential information of the Company being made available to competitors or (ii) that customers and other commercial partners may learn that a potential sale of the Company to another industry participant was being considered.

Later in the day, on October 25, 2024, the Board held a meeting by videoconference, with representatives of Moelis and Latham and members of Company Management in attendance, to discuss the terms of the non-binding expressions of interest submitted to the Company during the first round of the transaction process, the steps taken to date in connection with the strategic review being conducted by the Company, and additional feedback received to date from the potential counterparties that had submitted non-binding expressions of interest, including TPG. Moelis and the Transaction Committee reviewed with the Board the areas of opportunity relating to the business that were identified by these potential counterparties and the key challenges that had been discussed between the Company and these potential counterparties, as well as the reasons that participants in the process who had elected not to submit an acquisition proposal gave for withdrawing from the process, to the extent any reasons were given. Moelis also presented certain preliminary financial information and data regarding the Company and the indications of interest. The Transaction Committee also shared its recommendation that the Board invite the four potential counterparties offering the highest price per share (provided the Board believed they were capable of financing and executing a potential transaction at the offered price per share) to move forward to the next stage of the process. Following discussion with Moelis, Company

 

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Management and the Transaction Committee, the Board authorized Company Management and the Company’s advisors to move forward to the next stage of the process and invite the four potential counterparties offering the highest price per share, which included TPG and three other potential counterparties to whom we refer as Party A, Party B and Party C, to continue in the process. The Board determined to condition Party C’s participation in the next stage of the process on the satisfactory resolution of concerns regarding the sharing of competitively sensitive information with Party C. The Board also authorized representatives of Moelis to inform each potential counterparty that had submitted a non-binding expression of interest, other than TPG and Party A, that they would be expected to improve the financial terms of their proposals if they were to be the successful bidder.

Over the following two weeks, representatives of Moelis invited TPG and Party A, Party B and Party C to move forward to the next stage of the process and held meetings with the four potential counterparties to encourage them to improve the financial terms of their proposals. During this period, (a) Party B expressed an interest in joining with one potential counterparty that had submitted an oral non-binding expression of interest conditioned on an exclusive process, to whom we refer as Party D, to bid as a consortium through the Company’s ongoing process, (b) one potential counterparty, to whom we refer as Party E, improved the financial terms of its initial proposal, and (c) Party F and Party G, the remaining two potential counterparties, indicated to Moelis that they would not improve the financial terms of their proposals and therefore did not intend to continue pursuing a potential transaction with the Company. Additionally, during this period, representatives of Moelis and Company Management engaged in discussions with Party C in an effort to address the competitive concerns identified by the Board.

On November 4, 2024, the Transaction Committee held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management in attendance, to discuss the review of strategic alternatives of the Company and the non-binding expressions of interest Company Management received from TPG and each of Party A, Party B and Party C. Moelis provided an update to the Transaction Committee regarding its discussions with the other potential counterparties, including Party B’s interest in moving forward to the next stage of the process as part of a consortium with Party D, which the Transaction Committee agreed to permit. Moelis discussed with the Transaction Committee the timing and structure of a potential transaction and contemplated sources of financing in order for the Board to assess whether any such proposal would be viable, and reviewed the then-current state of the capital markets and potential difficulties in financing any transaction involving the Company, as well as observations on the renewable energy market. Representatives of Moelis also discussed with the Transaction Committee and Company Management other existing opportunities and strategic alternatives that might be available to the Company, including continuing to execute on its business plan as a public company. Representatives of Latham made a presentation to the Transaction Committee regarding fiduciary duties of directors and other obligations of the Board members.

On November 6, 2024, the Board held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management in attendance, to discuss the non-binding expressions of interest received and the potential transaction process. Moelis discussed with the Board the timing and structure of a potential transaction and contemplated sources of financing in order for the Board to assess whether such a proposal would be viable, and reviewed the then current state of the capital markets and potential difficulties in financing any transaction involving the Company, as well as certain observations on the renewable energy market, including strategic transactions announced by peer group companies in the Company’s industry. Representatives of Moelis also discussed with the Board and Company Management other existing opportunities and strategic alternatives that might be available to the Company, including continuing to execute on its business plan as a public company. Representatives of Latham made a presentation to the Board regarding fiduciary duties of directors and other obligations of the Board members.

On November 11, 2024, the Transaction Committee held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management in attendance, to discuss the potential transaction process. Moelis and Company Management discussed with the Transaction Committee that, following several weeks of negotiation, the Company and Party C were unable to agree to confidentiality and other protections necessary to address the competitive concerns raised by the Board. Moelis also discussed the improved financial

 

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terms offered by Party E. Following discussion with Company Management and its advisors, the Transaction Committee determined not to continue to pursue a transaction with Party C, and authorized Company Management and its advisors to invite Party E to move forward to the next stage of the process.

On November 12, 2024, the Company reported its results for the third quarter of 2024.

On November 13, 14, 18 and 19, 2024, Company Management and representatives of Moelis held in person management presentations with representatives of TPG and Party A, Party B and Party D (as a consortium), and Party E and provided on-site visits and tours of one of the Company’s solar facilities in New York.

On November 20, 2024, the Transaction Committee held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management in attendance, to discuss updates in the potential transaction process.

On November 25, 2024, the Transaction Committee held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management in attendance, to review the steps taken to date in connection with the strategic review being conducted by the Company as well as feedback received to date from the potential counterparties. The Transaction Committee also reviewed the projections of Company Management included in the financial model and questions regarding the financial model that had been received from potential counterparties.

During November and December 2024, the Company made additional business, financial, legal, tax and operational information available in the online virtual data room to TPG, Party A, Party B and Party D (as a consortium) and Party E, and also hosted TPG for additional on-site visits and tours of certain solar facilities owned by the Company. In November 2024, Party D informed Moelis that it did not intend to continue pursuing a potential transaction with the Company, citing concerns regarding the political landscape. Additionally, in December 2024, Party B informed Moelis that it did not intend to continue pursuing a potential transaction with the Company due to inability to find another partner following Party D’s decision to drop from the process and lack of confidence in its ability to bid competitively.

On December 2, 2024, Moelis posted a Phase 2 process letter and a draft merger agreement that had been prepared by Latham to the virtual data room for potential counterparties, requesting Phase 2 proposals and markups of the draft merger agreement by January 10, 2025.

On December 9, 2024, the Transaction Committee held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management, to discuss updates on the ongoing transaction process and to review again the terms of the non-binding expressions of interest submitted to the Company during the first round of the transaction process.

On December 10, 2024, the Board held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management in attendance, to discuss updates on the ongoing transaction process and the market’s views of the Company, the Transaction Committee’s activities in connection with the process, and recommendations from the Company’s advisors with respect to the next steps of the process.

On December 12, 2024, Company Management provided Moelis with revised financial projections that included the Company’s results for the third quarter of 2024 and expectations regarding the Company’s performance for the fourth quarter of 2024 and subsequent quarters. The revised financial projections were subsequently shared with the counterparties remaining in the process.

During December 2024, the Company made additional business, financial, legal, tax and operational information available to the potential counterparties remaining in the process in the online virtual data room.

 

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Prior to the January 10^th bid deadline, Party A and Party E each informed Moelis that it did not intend to continue pursuing a potential transaction with the Company, but indicated a willingness to reengage on an extended timeline.

On January 14, 2025, consistent with TPG’s prior conversations with Moelis, representatives of TPG delivered to representatives of Moelis a proposal for the acquisition of all the outstanding shares of common stock of the Company, along with a revised draft of the merger agreement and an exclusivity letter. TPG proposed to acquire all of the issued and outstanding shares of Common Stock for a purchase price per share in cash of $5.00, which represented a 66% premium to the Company’s unaffected closing price on October 15, 2024, the last trading day prior to the Company’s announcement of a formal review of strategic alternatives by the Board.

The revised draft of the merger agreement that was included in TPG’s proposal contemplated that, among other things, (a) certain stockholders of the Company would deliver voting and support agreements in connection with the execution of the merger agreement, (b) the Board would not have the right to cause the Company to terminate the merger agreement to enter into a definitive agreement with respect to a superior proposal (the “superior proposal termination right”), (c) the Board would not have the right to change its recommendation to Company stockholders to adopt the merger agreement and approve the proposed transaction other than with respect to a superior proposal, (d) the Company would be obligated to submit the proposed transaction to its stockholders even if the Board (in accordance with the terms of the merger agreement) changed its recommendation to Company stockholders with respect to the proposed transaction (the “force-the-vote provision”), (e) TPG would have an unlimited number of matching rights in the event the Company received a competing offer, (f) the Company and TPG would each be required to pay a termination fee under certain circumstances equal to 5% of the equity value of the Company, (g) in the event the Company’s stockholders did not vote to adopt the merger agreement and approve the proposed transaction, the Company would reimburse TPG for its transaction expenses up to 2% of the equity value of the Company (the “naked no-vote reimbursement provision”), (h) TPG would have no obligation to pursue remedies to obtain antitrust approval of the proposed transaction, (i) the closing would be conditioned on there being no more than a specified percentage of shares exercising appraisal rights with respect to the proposed transaction (the “appraisal condition”), (j) the Company would agree to a broader set of representations and warranties, and (k) the Company would agree to additional restrictions with respect to the operation of the Company while the proposed transaction is pending.

After receiving TPG’s proposal, the Transaction Committee held a meeting by video conference, with representatives of Moelis and Latham and Senior Management, to discuss the terms of such proposal and next steps. The Transaction Committee discussed TPG’s active engagement in the process, as well as the benefits of engaging in a transaction with TPG, including TPG’s reputation and deep expertise in the clean energy sector, the belief that TPG could negotiate and execute definitive transaction documents expeditiously and the high confidence in TPG’s ability to execute a transaction.

On January 15, 2025, the Board held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management in attendance, to discuss TPG’s proposal. The Board authorized Moelis to contact TPG to discuss the Board’s initial reactions to its proposal, including the Board’s request that TPG increase its proposed merger consideration, minimize financing conditionality in the transaction, provide comfort regarding its ability to obtain antitrust and other required regulatory approvals for the transaction, provide the Company with a meaningful ability to consider alternative proposals required by the Board’s fiduciary duties, and modify the amount of the termination fees payable by the Company and TPG in certain circumstances. Moelis thereafter discussed the Board’s feedback to TPG’s proposal with a representative of TPG via telephone call. Mr. Felton also discussed the Board’s feedback on the financial terms of TPG’s proposal with a representative of TPG via a telephone call.

On January 17, 2025, TPG confirmed that the offer price included in its January 14^th proposal was final, but agreed to modify its proposal with respect to certain key provisions of the merger agreement, including (a) agreeing to provide an equity backstop for the full amount of the merger consideration, (b) removing the

 

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force-the-vote provision and the appraisal condition, (c) reducing the termination fee payable by the Company under certain circumstances from 5% to 4% of the Company’s equity value, and (d) increasing the termination fee payable by Parent under certain circumstances from 5% to 6% of equity value.

On January 19, 2025, the Board held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management in attendance, to discuss TPG’s revised proposal and updates to the financial model, which included the Company’s revised financial projections shared with Moelis and potential counterparties in December 2024. Based on the perceived benefits of engaging in a transaction with TPG, including TPG’s reputation and deep expertise in the clean energy sector, the belief that TPG could negotiate and execute definitive transaction documents expeditiously and the high confidence in TPG’s ability to execute a transaction, and the additional deal certainty resulting from, among other things, TPG’s agreement to provide a full equity backstop and the removal of the force-the-vote provision and the appraisal condition, the Board authorized the Company and its advisors to continue to negotiate with TPG and to send TPG a revised merger agreement consistent with the discussions at the Board meeting. The Board also approved using the updated financial model for Moelis’ financial analysis and sharing the updated financial model with TPG. During the meeting, Moelis presented certain preliminary financial information and data regarding the Company and the Merger Consideration. At the meeting, the Board also reviewed and discussed disclosures provided by Moelis on January 18, 2025 of certain relationships between Moelis, on the one hand, and TPG, on the other hand, and determined that the relationships disclosed by Moelis did not reflect a material conflict that would prevent Moelis acting as an effective financial advisor in the proposed transaction.

On January 22, 2025, Latham sent a revised draft of the merger agreement to Kirkland & Ellis LLP (“Kirkland”), outside legal counsel to TPG, that reflected, among other things, (a) decreasing the company termination fee to 3% of the Company’s equity value, (b) increasing TPG’s termination fee to 7% of the Company’s equity value, (c) removing the naked no-vote reimbursement provision, (d) reinserting the Board’s ability to consider alternative proposals under circumstances, including the superior proposal termination right and the Board’s ability to change its recommendation in the event of an intervening event, (e) limiting the number of times TPG can attempt to match the terms of a competing proposal, (f) removing the force-the-vote provision and the appraisal condition, (g) proposing that TPG would be obligated to pursue remedies to obtain antitrust approval of the proposed transaction if the remedies would not have a material and adverse impact on TPG or the Company, (h) revising the representations and warranties of the Company to better align with market standards, (i) adding additional flexibility under the interim operating covenants to ensure that the Company would be able to operate in the ordinary course of business during the interim period, and (j) reflecting TPG’s obligation to provide an equity backstop for the full amount of the merger consideration.

On January 24, 2025, the Board held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management in attendance, to discuss the status of negotiations with TPG. The Board provided direction on the material remaining issues and also approved entering into an exclusivity agreement with TPG for a limited period of time. After further discussions, the parties determined not to enter into that agreement.

On January 26, 2025, Kirkland sent a revised draft of the merger agreement to Latham that reflected, among other things, (a) increasing the company termination fee to 3% of the Company’s enterprise value, (b) decreasing TPG’s termination fee to 6% of the Company’s equity value, (c) setting the expense reimbursement cap equal to 2% of the Company’s equity value, (d) reinserting that TPG would have an unlimited number of matching rights in the event the Company received a competing offer, (e) eliminating any obligation of TPG to pursue remedies to obtain antitrust approval of the proposed transaction, and (f) an expanded set of interim operating covenants of the Company, including limits on the Company’s ability to incur indebtedness under certain existing credit facilities during the interim operating period without TPG’s consent.

On January 27, 2025, the Board held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management in attendance, to discuss the status of negotiations with TPG. The Board provided direction on the material remaining issues for negotiation.

 

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On January 27, 2025, representatives of Latham and Kirkland discussed certain open terms in the merger agreement, including the following key changes, among others, that would be reflected in Latham’s next version of the merger agreement: (a) the relative dollar values of the termination fees payable by TPG and the Company under certain circumstances; (b) reinserting certain obligations of TPG with respect to securing equity commitments; and (c) limitations on the scope of certain interim operating covenants of the Company to better align with market standards. Following this discussion, on January 28, 2025, Latham sent a revised draft of the merger agreement to Kirkland that reflected, among other things: (a) increasing TPG’s termination fee to $75,000,000, (b) decreasing the company termination fee to $60,000,000, (c) decreasing the expense reimbursement cap to $8,000,000, and (d) reflecting the other changes discussed on the January 27, 2025 call between representatives of Latham and Kirkland.

On January 29, 2025, representatives of Latham and Kirkland discussed certain open terms in the merger agreement, including (a) the amount of the termination fee payable by TPG under certain circumstances proposed in the prior draft from Latham, (b) the number of times TPG can attempt to match the terms of a competing proposal, (c) the Company’s cooperation in obtaining in the Required Debt Consents, and (d) adding a condition to closing that TPG shall have obtained approval under Section 203 of the Federal Power Act. Later that day, Kirkland indicated that Parent would be agreeable to a $70,000,000 Parent Termination Fee subject to the negotiation of the other open terms.

On January 30, 2025, the Board held a meeting by videoconference, with representatives of Moelis and Latham and members of Senior Management in attendance, to discuss the resolution of the final material transaction issues, including the equity commitment letter, the “superior proposal” match rights in favor of TPG, and the treatment of certain representations and warranties as “fundamental” for purposes of conditions to closing. The Board concluded that all material legal terms of the potential transaction had been resolved and, accordingly, that the merger consideration and other material deal terms had been agreed with TPG. On this basis, the Board authorized Company Management to commence discussions with TPG regarding their post-transaction positions and compensation, and the Board authorized Company Management and the significant stockholders with Board representation to commence discussions with TPG regarding potentially rolling over their equity interests in the Company post-transaction.

Representatives of TPG thereafter provided drafts of an equity rollover agreement to certain Company stockholders, and those stockholders engaged in negotiations with TPG over the equity rollover agreement over the following days.

Also on January 30, 2025, Kirkland sent a revised draft of the merger agreement to Latham that reflected, among other things, (a) decreasing TPG’s termination fee to $70,000,000, (b) adding FERC 203 Approval as a condition to Closing, and (c) reinserting that TPG has an unlimited number of matching rights in the event the Company receives competing offers.

From February 1 through February 4, 2025, representatives of Kirkland and Latham continued to exchange drafts of the merger agreement to, among other things, agree upon the appropriate scope of the level of flexibility that the Company will have to continue to operate the business in the ordinary course during the interim operating period, and the form of company support agreement.

On February 5, 2025, the Board held a meeting by videoconference, with representatives of Moelis, representatives of Latham, and members of Senior Management in attendance. Representatives of Latham gave a presentation to the Board regarding fiduciary duties of directors and other obligations of the Board members and provided disclosure of certain relationships between Latham, on the one hand, and the Phase 2 potential counterparties, on the other hand, and provided a summary of the material terms of the merger agreement. The Board determined that the relationships disclosed by Latham did not reflect a material conflict in the context of the proposed transaction. Representatives of Moelis then reviewed and discussed with the Board Moelis’ financial analyses regarding the Company and the Merger Consideration. At the request of the Board, Moelis

 

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rendered its oral opinion on February 5, 2025 to the Board, which was subsequently confirmed in writing by delivery of Moelis’ written opinion addressed to the Board dated the same date, to the effect that, as of February 5, 2025 and subject to the assumptions made, procedures followed, matters considered and other limitations set forth in the opinion, the Merger Consideration to be received by holders of Company Class A Common Stock, other than the Excluded Holder, in the Merger was fair, from a financial point of view, to such holders. The Moelis opinion is more fully described in the section of this proxy statement titled “The Merger— Fairness Opinion of Moelis & Company LLC.“ Following discussion, the Board unanimously (a) approved the Merger Agreement and the transactions contemplated thereby, including the Merger, (b) determined that the Merger Agreement and the transactions contemplated by the Merger Agreement are advisable, fair to and in the best interests of the Company and its stockholders, (c) approved the execution, delivery and performance by the Company of the Merger Agreement, (d) directed that the adoption of the Merger Agreement be submitted to a vote of the Company’s stockholders, and (e) resolved to recommend adoption of the Merger Agreement by the Company’s stockholders.

On February 5, 2025, the parties and their respective financial and legal advisors finalized the Merger Agreement and related transaction agreements, and the Company and TPG then executed and delivered the Merger Agreement and related transaction agreements. The stockholders party to the support agreements and the Rollover Agreement also executed and delivered those agreements on the same day.

On February 6, 2025, before the commencement of trading hours, the Company and TPG issued a joint press release announcing the Transactions. The Company filed with the SEC on Form 8-K a copy of the Merger Agreement, the form of Company Support Agreement and the press release announcing the Merger as exhibits.

Recommendation of the Board and Reasons for the Merger

The Board evaluated, with the assistance of its outside legal and financial advisors, the Merger Agreement and the Merger and unanimously determined that the Merger Agreement and the Transactions are advisable, fair to, and in the best interests of the Company and its stockholders, unanimously approved the Transactions, and unanimously recommended that Company stockholders adopt the Merger Agreement.

The Board recommends that you vote “FOR” the Merger Proposal and “FOR” the Adjournment Proposal (the “Company Recommendation”).

On February 5, 2025, the Board unanimously (a) determined that the Merger Agreement and the Transactions are advisable, fair to, and in the best interests of the Company and our stockholders, (b) approved the Merger Agreement and approved the Transactions, (c) approved the execution, delivery, and performance by the Company of the Merger Agreement, (d) directed that the adoption of the Merger Agreement be submitted to a vote of our stockholders, and (e) recommended that the Company stockholders adopt the Merger Agreement.

In recommending that our stockholders vote their shares of Class A Common Stock in favor of the Merger Proposal, the Board considered a number of reasons, including the following (not necessarily in order of relative importance):

 

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Attractive Value. The Board’s belief that the Merger Consideration represents an attractive value for the shares of Class A Common Stock, taking into account the Board’s familiarity with our business, operations, assets, operating results, financial condition, prospects, and business strategy, and the Board’s belief, based on the course and history of the negotiations between Parent and the Company, that the Merger Consideration represented the highest consideration that Parent was willing to pay.

 

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Best Alternative for Maximizing Stockholder Value. The Board considered that the Merger Consideration was more favorable to our stockholders than the potential value that might result from other alternatives reasonably available to the Company, including the potential stockholder value based on our business plan that could be expected to be generated from remaining a publicly traded company, the possibility of being acquired by other companies, the possibility of acquisitions or mergers with

 

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other companies and other transactions, as well as the potential benefits, risks, and uncertainties associated with such alternatives.

 

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Timing. The Board considered current market activity, changes in general economic and political conditions, and timing for the Company to explore a potential strategic transaction, including in light of recent trends in its industry and the impact of market volatility on the Company. The Board concluded that it was an opportune time for the Company to consider a sale of the Company in light of these factors.

 

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Risks Relating to Remaining a Publicly Traded Company. The Board reviewed the Company’s business, operations, assets, operating results, financial condition, prospects, business strategy, competitive position, and industry, including the potential impact of those factors on the trading price of our Class A Common Stock, to assess the prospects and risks associated with remaining a publicly traded company. The Board believed that the acquisition of the Company by Parent for $5.00 per share (excluding Canceled Shares, Dissenting Shares, and Rollover Shares) in cash was more favorable to our stockholders than the value of remaining a publicly traded company, after accounting for the risks and uncertainties associated with achieving and executing upon our business and financial plans in the short- and long-term.

 

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Certainty of Value. The Merger Consideration consists solely of cash, which provides immediate liquidity and certainty of value to our stockholders compared to any transaction in which our stockholders would receive shares of an acquirer’s stock. The Board weighed the certainty of realizing a compelling value for shares of Class A Common Stock by virtue of the Merger against the risks and uncertainties associated with our business, including those described above, as well as the other risks and uncertainties discussed in the Company’s public filings with the SEC. See the section entitled “Where You Can Find More Information” of this proxy statement.

 

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Historical Value. The Board considered the value represented by the Merger Consideration compared against the current and historical trading prices of our Class A Common Stock, including the market performance of our Class A Common Stock relative to those of other participants in the Company’s industry and general market indices, and the fact that the Merger Consideration represents a 66% premium to the Company’s unaffected closing price on October 15, 2024, the last trading day prior to the Company’s announcement of a formal review of strategic alternatives by the Board.

 

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Review Process. The Board considered the fact that it had engaged in extensive discussions with Company Management, representatives of its financial advisors, and outside legal counsel, and also took into consideration the financial expertise held by a number of its directors. In particular, the Board contacted or responded to inbound interest from the most feasible potential buyers and engaged in an extensive competitive auction and due diligence process with multiple potential buyers. The Board further considered that the Transaction Committee (as defined in the section entitled “The Merger—Background of the Merger” of this proxy statement) reviewed and assessed, and assisted the Board in reviewing and assessing, the Transactions.

 

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Ability to Respond to Acquisition Proposals. The Board considered the “fiduciary out” provisions of the Merger Agreement, which, subject to the terms and conditions thereof, permit the Company to furnish information to and conduct negotiations with third parties that make Acquisition Proposals under certain circumstances, permit the Board to change its recommendation to our stockholders regarding the Merger, and permit the Company to terminate the Merger Agreement in order to enter into a Superior Proposal, subject to payment of a termination fee to Parent. The Board further considered the fact that such $60,000,000 termination fee (approximately 3% of the enterprise value of the Company) payable by the Company to Parent upon a termination in accordance with the Merger Agreement in certain circumstances (a) is reasonable in light of the overall terms of the Merger Agreement and the benefits of the Merger and (b) would not preclude another party from making a competing proposal.

 

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Terms of the Merger Agreement. The Board considered all of the terms and conditions of the Merger Agreement, including the structure of the transaction, the all-cash form of the Merger Consideration,

 

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the limited scope of the conditions to closing, the Rollover, the Company Support Agreements, and the customary nature of the representations, warranties, and the covenants and agreements of the parties. The Board further considered the course and nature of negotiations with Parent, which were conducted at arm’s length and during which the Transaction Committee and the Board were advised by independent legal and financial advisors. These negotiations ultimately resulted in terms that (a) provide for a significant premium over the trading price of our Class A Common Stock and (b) provide robust provisions to increase certainty of the consummation of the Merger, absent certain prohibitive events or the submission of a Superior Proposal. The Board believed, based on these negotiations, that these were the most favorable terms available to the Company and its stockholders on which Parent, or an alternative purchaser, would be willing to transact.

 

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Fairness Opinion. The financial analyses reviewed and discussed with the Board on February 5, 2025 by representatives of Moelis in connection with the consideration by the Board of the proposed Merger, as well as the oral opinion of Moelis rendered to the Board on February 5, 2025, which was subsequently confirmed in writing by delivery of Moelis’ written opinion addressed to the Board dated the same date, to the effect that, as of February 5, 2025 and subject to the assumptions made, procedures followed, matters considered and other limitations set forth in the opinion, the Merger Consideration to be received by holders of Company Class A Common Stock, other than the Excluded Holder, in the Merger was fair, from a financial point of view, to such holders. For more information, see the sections entitled “The Merger—Fairness Opinion of Moelis & Company LLC” of this proxy statement.

 

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Likelihood of Consummation. The likelihood that the Merger will be consummated, based on, among other things, the Merger Agreement having a limited number of conditions to the Merger, including the absence of a financing condition, the relative likelihood of obtaining required regulatory approvals, the remedies available under the Merger Agreement to the Company in the event of various breaches by Parent, the fact that Parent had already obtained committed equity and debt financing for the Transactions, the limited nature of the conditions to such equity and debt financing, and TPG’s reputation, its financial capacity to complete an acquisition of this size and its prior track record of successfully completing acquisitions, all of which the Board believed supported the conclusion that a transaction with Parent could be completed relatively quickly and in an orderly manner.

 

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Stockholder Approval; Appraisal Rights. The Board considered that the Merger would be subject to the approval of our stockholders, that stockholders would be free to reject the Merger, and that stockholders (and beneficial owners) who do not vote to adopt the Merger Agreement and who follow certain prescribed procedures are entitled to dissent from the Merger and receive the appraised fair value of their shares, as provided under Delaware law.

The Board also considered and balanced against the potentially positive factors a number of uncertainties, risks, and other potentially negative factors in its deliberations concerning the Merger and the other Transactions, including the following (not necessarily in order of relative importance):

 

•

No Stockholder Participation in Future Earnings or Growth. The Board considered the fact that the Company will no longer be a publicly traded company, and accordingly, our stockholders will no longer participate in any future growth the Company may experience or any potential future appreciation in the value of shares of our Class A Common Stock.

 

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Inability to Solicit Other Takeover Proposals. The Board considered that the Merger Agreement includes a covenant prohibiting the Company from soliciting, initiating, seeking, or knowingly facilitating or encouraging any inquiry, discussion, offer, or request that constitutes, or would reasonably be expected to lead to, an Acquisition Proposal. The Board also considered, but did not consider preclusive, the fact that the right afforded to Parent under the Merger Agreement to re-negotiate the terms of the Merger Agreement in response to a Superior Proposal may discourage other parties, who might otherwise have an interest in a business combination with, or an acquisition of, the Company, from making such a proposal.

 

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•

Termination Fee. The Board considered the fact that the Company may be required to pay a termination fee of $60,000,000 (approximately 3% of the enterprise value of the Company) if the Merger Agreement is terminated under certain circumstances, including to enter into a Superior Proposal, and that the amount of the termination fee is comparable to termination fees in transactions of a similar size was reasonable, would not likely deter competing bids, and would not likely be required to be paid unless the Company entered into a more favorable transaction. The Board also recognized that Parent considered the provisions relating to these fees to be of critical importance to Parent.

 

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Effect of Public Announcement. The Board considered the effect of the public announcement of the Company entering into the Merger Agreement on our operations, including our relationships with customers, vendors, and employees and other business relationships, as well as our ability to attract and retain key personnel while the proposed transaction is pending and the potential adverse effects on our financial results as a result of that disruption, as well as the possibility of any suit, action, or proceeding in respect of the Merger Agreement or the Transactions.

 

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Opportunity Costs and Interim Operating Covenants. The Board considered that the focus and resources of Company Management may become diverted from other important business opportunities and operational matters while working to implement the Merger, which could adversely affect our business. The Board also considered the restrictions on the conduct of our business and prohibitions on taking certain actions during the pendency of the Merger, which may delay or prevent the Company from undertaking potential business opportunities that may arise or any other action it would otherwise take with respect to the operations of the Company absent the pending completion of the Merger, or may negatively affect our ability to attract, retain, and motivate key personnel.

 

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Risk the Merger May Not Be Consummated. The Board considered the fact that consummation of the Merger is subject to the satisfaction of certain closing conditions that are not within our control, including receipt of the necessary regulatory clearances and approvals and that no Company Material Adverse Effect has occurred. There can be no assurance that all conditions to the parties’ obligations to consummate the Merger will be satisfied, and as a result, it is possible that the Merger may not be consummated even if the Merger is approved by our stockholders. The Board considered the fact that if the Merger is not consummated (a) we will have incurred significant transaction and opportunity costs, including the possibility of disruption to our operations, diversion of Company Management and employee attention, employee attrition, and a potentially negative effect on our business and customer relationships; (b) the trading price of our Class A Common Stock could be adversely affected; and (c) the market’s perceptions of our prospects could be adversely affected.

 

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Financing May Not Be Obtained. The possibility that the Equity Financing contemplated by the Equity Commitment Letter and the Committed Debt Financing contemplated by the Debt Commitment Letter will not be obtained prior to the outside date set forth in the Merger Agreement or the date of expiration or termination of the Lenders’ commitments under the debt commitment letter, or obtained at all, resulting in Parent not having sufficient funds to complete the Merger.

 

•

Litigation. The Board considered the potential for distracting litigation from stockholder suits in connection with the Merger and the risk of incurring substantial costs and expenses related thereto.

 

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Transaction Costs. The Board considered the fact that we have incurred and will continue to incur significant transaction costs and expenses in connection with the Merger, regardless of whether the Merger is consummated.

 

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Potential Differing Interests of Directors and Officers. The Board considered the risk that certain directors and officers may have interests in the Transactions as individuals that are in addition to, or that may be different from, the interests of our stockholders. See the section entitled “The Merger—Interests of the Directors and Executive Officers of the Company in the Merger” of this proxy statement.

 

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Tax Treatment. The Board considered the fact that the Merger will be a taxable transaction to our stockholders that are U.S. Holders for U.S. federal income tax purposes, and, therefore, such

 

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stockholders generally will be required to pay U.S. federal income tax on any gains they recognize as a result of the Merger.

 

•

Other Risks. Other risks described in and incorporated by reference in this proxy statement. See the section entitled “Where You Can Find More Information” of this proxy statement.

The Board believed that, overall, the risks and uncertainties associated with the Merger were outweighed by the potential benefits of the Merger to our stockholders.

The foregoing discussion of factors considered by the Board is not intended to be exhaustive, but summarizes the material factors considered by the Board. In light of the variety of factors considered in connection with their evaluation of the Merger, the Board did not find it practicable to, and did not, quantify or otherwise assign relative weights to the specific factors considered in reaching their determinations and recommendations. Moreover, each member of the Board applied their own personal business judgment to the process and may have given different weight to different factors. The Board did not make any specific determination as to whether any factor, or any particular aspect of any factor, supported or did not support its ultimate determinations. The Board based its recommendation on the totality of the information presented, including thorough discussions with, and questioning of, our Senior Management and outside financial advisors and legal counsel. The Board recommends that you vote “FOR” the Merger Proposal and the Adjournment Proposal. It should be noted that this explanation of the reasoning of the Board and certain information presented in this section is forward-looking in nature and should be read in light of the factors set forth in the section entitled “Cautionary Statement Regarding Forward-Looking Statements” of this proxy statement.

Fairness Opinion of Moelis & Company LLC

At the meeting of the Board on February 5, 2025 to evaluate and approve the Merger contemplated by the Merger Agreement, Moelis delivered an oral opinion, which was confirmed by delivery of a written opinion, dated February 5, 2025, addressed to the Board to the effect that, as of the date of the opinion and based upon and subject to the assumptions made, procedures followed, matters considered and other limitations set forth in the opinion, the Merger Consideration to be received by the holders of Altus Power Class A Common Stock, other than the Excluded Holder, in the Merger was fair, from a financial point of view, to such holders.

The full text of Moelis’ written opinion dated February 5, 2025, which sets forth the assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Appendix C to this proxy statement and is incorporated herein by reference. Moelis’ opinion was provided for the use and benefit of the Board (in its capacity as such) in its evaluation of the Merger. Moelis’ opinion was limited solely to the fairness, from a financial point of view, to the holders of Altus Power Class A Common Stock, other than the Excluded Holder, of the Merger Consideration to be received by such holders in the Merger, and does not address Altus Power’s underlying business decision to engage in the Transactions or the relative merits thereof as compared to any alternative business strategies or transactions that might be available to Altus Power. Moelis’ opinion does not constitute a recommendation to any stockholder of Altus Power as to how such stockholder should vote or act with respect to the Transactions or any other matter. Moelis’ opinion was approved by a Moelis fairness opinion committee.

In arriving at its opinion, Moelis, among other things:

 

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reviewed certain publicly available business and financial information relating to Altus Power;

 

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reviewed certain internal information relating to the business, earnings, cash flow, assets, liabilities, and prospects of Altus Power furnished to Moelis by Altus Power, including financial forecasts provided to or discussed with Moelis by the management of Altus Power;

 

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reviewed information regarding the capitalization of Altus Power furnished to Moelis by Altus Power;

 

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•

conducted discussions with members of senior management and representatives of Altus Power concerning the information described in the foregoing bullets, as well as the business and prospects of Altus Power generally;

 

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reviewed the reported prices and trading activity for Altus Power Class A Common Stock;

 

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considered the results of efforts by or on behalf of Altus Power, including by Moelis at Altus Power’s direction, to solicit indications of interest from third parties with respect to a possible acquisition of all or a portion of Altus Power;

 

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reviewed publicly available financial and stock market data of certain other companies in lines of business that Moelis deemed relevant;

 

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reviewed the financial terms of certain other transactions that Moelis deemed relevant;

 

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reviewed a draft, dated February 5, 2025, of the Merger Agreement;

 

•

participated in certain discussion and negotiations among representatives of Altus Power and Parent and their advisors; and

 

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conducted such other financial studies and analyses and took into account such other information as Moelis deemed appropriate.

In connection with its financial analysis and opinion, Moelis relied on the information supplied to, discussed with or reviewed by it being complete and accurate in all material respects. Moelis did not independently verify any such information or assume any responsibility for the independent verification of any such information. Moelis also relied on the representation of Altus Power’s management that they are not aware of any facts or circumstances that would make any such information inaccurate or misleading. Moelis relied upon, without independent verification, the assessment of Altus Power and its legal, tax, regulatory and accounting advisors with respect to legal, tax, regulatory, and accounting matters. With respect to the financial forecasts referred to above, Moelis assumed, at the direction of the Board, that they had been reasonably prepared on a basis reflecting the best currently available estimates and judgments of the management of Altus Power as to the future performance of Altus Power. Moelis expressed no views as to the reasonableness of any financial forecasts or the assumptions on which they are based. In addition, Moelis did not make any independent evaluation or appraisal of any of the assets or liabilities (contingent, derivative, off-balance-sheet, or otherwise) of Altus Power, nor was Moelis furnished with any such evaluation or appraisal.

Moelis’ opinion did not address Altus Power’s underlying business decision to effect the Merger or the relative merits of the Merger as compared to any alternative business strategies or transactions that might be available to Altus Power. Moelis’ opinion did not address any legal, regulatory, tax or accounting matters. Moelis was not asked to, nor did it, offer any opinion as to any terms of the Merger Agreement or any aspect or implication of the Merger (including any rollover that may be available to one or more stockholders in the Merger and any voting and support agreement to be entered into in connection with the Merger), except for the fairness of the Merger Consideration from a financial point of view to the holders of Altus Power Class A Common Stock, other than the Excluded Holder. Moelis’ opinion did not address, and Moelis expressed no opinion regarding, any aspects or implications of the Conversion, and Moelis assumed for purposes of its analyses and opinion that the Conversion is effected on the terms described to Moelis by representatives of Altus Power. Moelis did not express any opinion as to fair value, viability or the solvency of Altus Power following the Closing. In rendering its opinion, Moelis assumed that the final executed form of the Merger Agreement would not differ in any material respect from the draft that it had reviewed, that the Merger would be consummated in accordance with its terms without any waiver or modification that could be material to Moelis’ analysis, that the representations and warranties of each party set forth in the Merger Agreement were accurate and correct, and that the parties to the Merger Agreement would comply with all the material terms of the Merger Agreement. Moelis assumed that all governmental, regulatory or other consents or approvals necessary for the completion of the Merger would be obtained, except to the extent that could not be material to its analysis.

 

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Moelis’ opinion was necessarily based on economic, monetary, market and other conditions as in effect on, and the information made available to Moelis as of, the date of the opinion and Moelis assumed no responsibility to update its opinion for developments occurring or coming to its attention after the date thereof.

Moelis’ opinion did not address the fairness of the Merger or any aspect or implication thereof to, or any other consideration of or relating to, the holders of any class of securities, creditors or other constituencies of Altus Power (other than the fairness of the Merger Consideration from a financial point of view to the holders of Altus Power Class A Common Stock, other than the Excluded Holder). In addition, Moelis did not express any opinion as to the fairness of the amount or nature of any compensation to be received by any officers, directors or employees of any parties to the Merger, or any class of such persons, relative to the Merger Consideration or otherwise. Moelis’ opinion was approved by a Moelis fairness opinion committee.

This summary of the financial analyses is not a complete description of Moelis’ opinion or the analyses underlying, and factors considered in connection with, Moelis’ opinion. The preparation of a fairness opinion is a complex analytical process and is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analyses or summary set forth above, without considering the analyses as a whole, could create an incomplete view of the processes underlying Moelis’ opinion. In arriving at its fairness determination, Moelis considered the results of all of its analyses and did not attribute any particular weight to any factor or analysis. Rather, Moelis made its fairness determination on the basis of its experience and professional judgment after considering the results of all of its analyses.

No company used in the analyses described below is identical to Altus Power. In addition, such analyses do not purport to be appraisals, nor do they necessarily reflect the prices at which businesses or securities actually may be sold. Analyses based upon forecasts of future results are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by such analyses. Because the analyses described below (including much of the information used therein) are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of the parties or their respective advisors, neither Altus Power nor Moelis or any other person assumes responsibility if future results are materially different from those forecasts.

The Merger Consideration was determined through arms’ length negotiations between Altus Power and Parent, and was approved by the Board. Moelis did not recommend any specific consideration to Altus Power or the Board, or that any specific amount or type of consideration constituted the only appropriate consideration to be paid in the Merger.

Summary of Financial Analyses

The following is a summary of the material financial analyses prepared by Moelis in connection with its opinion to the Board at a meeting held on February 5, 2025. This summary describes the material analyses underlying Moelis’ opinion but does not purport to be a complete description of the analyses performed by Moelis in connection with its opinion.

Some of the summaries of financial analyses below include information presented in tabular format. In order to fully understand Moelis’s analyses, the tables must be read together with the text of each summary. The tables alone do not constitute a complete description of the analyses. Considering the data described below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of Moelis’ analyses.

For purposes of Moelis’ analyses:

 

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“Adjusted EBITDA” was generally calculated as the relevant company’s earnings before interest, taxes, depreciation and amortization; provided that references in this section to Adjusted EBITDA of Altus Power reflect Altus Power management estimates (for the definition Adjusted EBITDA used by Altus Power, including adjustments thereto, see “The Merger—Certain Financial Forecasts”).

 

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•

“Total Enterprise Value” (or “TEV”) was generally calculated as the market value of the relevant company’s fully diluted common equity based on its closing stock price on a specified date, plus (a) indebtedness, less (b) cash and cash equivalents, plus (c) the book value of preferred stock and non-controlling interests, plus (d) asset retirement obligations, where applicable (in each of the foregoing cases as of the relevant company’s most recently reported quarter end).

Discounted Cash Flow Analysis

Utilizing the Altus Power forecasted financial information and other information and data provided by Altus Power management, Moelis performed a discounted cash flow (“DCF”) analysis of Altus Power to calculate the present value, as of September 30, 2024, of (a) the estimated future unlevered after-tax free cash flows projected to be generated by Altus Power for the three months ended December 31, 2024 and the calendar years ending December 31, 2025 through December 31, 2030 and (b) the estimated terminal value of Altus Power, as described below. For purposes of the DCF analysis, unlevered free cash flow was calculated as Adjusted EBITDA less capital expenditures, adjusted for stock-based compensation being treated as a cash expense and tax equity proceeds, distributions and buyout cash flows (each as reflected in the Altus Power financial forecasts).

Moelis utilized a range of discount rates of 8.25% to 10.25% based on an estimated range of the weighted average cost of capital (“WACC”) for Altus Power. The estimated WACC range was derived using the Capital Asset Pricing Model and a size premium. Moelis used the foregoing range of discount rates to calculate the present values as of September 30, 2024 of (a) the estimated unlevered after-tax free cash flows of Altus Power for the three months ended December 31, 2024 and the calendar years ending December 31, 2025 through December 31, 2030 (in each case, discounted using a mid-year discounting convention) and (b) the estimated terminal value range derived by applying a range of selected terminal multiples of 11.00x to 12.00x to an estimate of Altus Power’s terminal year Adjusted EBITDA approved by the Board (see “The Merger—Certain Financial Forecasts”). The range of terminal multiples used by Moelis was selected based on its professional judgment and experience and reflected the multiple range applied in Moelis’ selected publicly traded companies analysis to Altus Power’s 2025E Adjusted EBITDA, as further described below. The DCF analysis indicated an implied per share value range for Altus Power Class A Common Stock of $2.13 to $6.91 per share, as compared to the Merger Consideration.

Selected Publicly Traded Companies Analysis

Moelis reviewed financial and stock market information of the selected publicly traded companies noted below (the “Selected Companies”), which Moelis determined, based on its professional judgment and experience, to be generally relevant in certain respects to Altus Power for purposes of this analysis. Although none of the selected publicly traded companies that Moelis considered in its financial analysis are directly comparable to Altus Power, in determining the publicly traded companies to use in this analysis, Moelis referenced publicly traded companies that were renewable independent power producers whose primary business consists of generating clean, renewable power, principally to sell to customers under long-term power purchase agreements, operate an at-scale portfolio of generation assets and have plans to develop or acquire further generation assets. The estimates of the future financial performance for the selected publicly traded companies listed below were based on publicly available research analyst estimates for those companies.

The Selected Companies used by Moelis in this analysis are as follows:

 

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Clearway Energy, Inc. (“Clearway”)

 

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Innergex Renewable Energy Inc. (“Innergex”)

 

•

Boralex Inc. (“Boralex”)

 

•

Northland Power Inc. (“Northland Power”)

 

•

XPLR Infrastructure, LP (“XPLR”), formerly named NextEra Energy Partners, LP

 

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Moelis reviewed and analyzed, among other things, the TEV of each of the Selected Companies, as well as Altus Power, as a multiple of estimated Adjusted EBITDA for each of the calendar years 2025 and 2026 (as of January 31, 2025 for the Selected Companies and as of January 31, 2025 and October 15, 2024 (the last trading day prior to Altus Power’s announcement regarding its strategic alternatives review process) for Altus Power), in each case based on publicly available consensus research estimates.

The Selected Companies and their implied TEV to estimated Adjusted EBITDA multiples for each of the calendar years 2025 and 2026 used by Moelis in this analysis are summarized in the following table:

 

		TEV / 2025E Adjusted EBITDA				TEV / 2026E Adjusted EBITDA
Selected Companies
Clearway			11.0x				10.2x
Innergex			10.0x				10.0x
Boralex			9.2x				8.5x
Northland Power			9.1x				8.0x
XPLR			8.7x				9.2x
Mean			9.6x				9.2x
Median			9.2x				9.2x
Altus Power (10/15/24)			12.8x				10.5x
Altus Power (1/31/25)			14.8x				12.4x

Based on the foregoing analysis and its professional judgement and experience, Moelis selected (a) a reference range for TEV/2025E Adjusted EBITDA multiples for Altus Power of 11.0x to 12.0x and (b) a reference range for TEV/2026E Adjusted EBITDA multiples for Altus Power of 9.5x to 10.5x. Moelis then applied these multiples to Altus Power’s 2025E Adjusted EBITDA and 2026E Adjusted EBITDA based on the Altus Power forecasted financial information.

This analysis indicated implied per share value ranges for Altus Power Class A Common Stock of $2.31 to $3.25 per share (based on 2025E Adjusted EBITDA) and $3.39 to $4.59 (based on 2026E Adjusted EBITDA), as compared to the Merger Consideration.

Other Information

Moelis also noted for the Board certain additional factors that were not considered part of Moelis’s financial analysis with respect to its opinion but were referenced for informational purposes only, including, among other things:

Leveraged Buyout Analysis

Moelis also considered theoretical per share purchase prices that could be paid by a hypothetical financial buyer for 100% of the Altus Power Class A Common Stock. Moelis based its analysis on the Altus Power financial forecasts. Moelis noted that assuming a target annualized internal rate of return of 12.00% to 18.00%, a range of exit multiples of 11.0x to 12.0x informed by the 2025E EBITDA multiple range used in the selected publicly traded companies analysis described above and a 6.25-year investment hold period, the analysis indicated potential transaction prices that could be paid and generate the required returns of $2.99 per share to $7.02 per share.

Selected Precedent Transactions Analysis

Moelis considered and reviewed select precedent transactions that involved target companies that focus on renewable power generation and non-regulated power providers. In performing its analysis, Moelis reviewed and

 

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analyzed, among other things, the TEV of the target business implied by the transaction price for each of the selected precedent transactions as a multiple of the last twelve months prior to transaction announcement (“LTM”) and full calendar year in which transaction was announced (“CY”) EBITDA for each target business. Financial data for such selected precedent transactions were based on public filings and other publicly available information relating to the relevant transaction, and LTM and CY EBITDA for each target company were calculated based on publicly available financial data at the time of announcement of the relevant selected precedent transaction and equity research estimates. Based on the foregoing analysis and its professional judgement and experience, Moelis selected a reference range of TEV / 2024E Adjusted EBITDA multiples for Altus Power of 12.0x to 14.0x. Moelis then applied these multiples to Altus Power’s 2024E Adjusted EBITDA based on the Altus Power’s forecasted financial information. This analysis indicated an implied per share value range for Altus Power Class A Common Stock of $0.15 per share to $1.51 per share.

52-Week High / Low

Moelis reviewed the historical trading performance of Altus Power Class A Common Stock over a 52-week period ending October 15, 2024 (the last trading day prior to Altus Power’s announcement regarding its strategic review process), which ranged from a closing share price low of $2.75 on October 10, 2024 to a closing share price high of $7.27 on February 15, 2024.

Equity Research Analyst Share Price Targets

Moelis reviewed publicly available share price targets from eight selected Wall Street equity research reports for Altus Power Class A Common Stock published between November 13, 2024 and January 14, 2025 which ranged from $4.00 per share to $6.50 per share.

Miscellaneous

Moelis acted as financial advisor to Altus Power in connection with the Merger and will receive a transaction fee (currently estimated to be approximately $10 million) based on the transaction value to be determined at Closing, against which Altus Power may credit the fee, to the extent paid, of $2 million which became payable upon Moelis having substantially completed its work in connection with rendering its opinion (regardless of the conclusions reached in the opinion). In addition, Altus Power agreed to indemnify Moelis and certain related persons and entities for certain liabilities, including liabilities under the federal securities laws, arising out of its engagement.

Moelis’ affiliates, employees, officers and partners may at any time own securities or other interests (long or short) in Altus Power and TPG Capital, the financial sponsor of Parent, and its related entities (collectively, “PE Sponsor”). Moelis provided and currently provides investment banking and other services to PE Sponsor unrelated to the Merger and in the future may provide such services to PE Sponsor, and have received and may receive compensation for such services. In the past two years prior to its opinion, Moelis and its affiliates acted as financial advisor to PE Sponsor in connection with the following completed assignments: (a) three buyside transactions, (b) three sellside transactions and (c) one valuation analysis, each of which was unrelated to the Merger and for which Moelis and its affiliates received fees of approximately $71 million. Moelis is currently acting as financial advisor to PE Sponsor in connection with one or more potential transactions that are unrelated to the Merger. If such potential transactions are completed, Moelis estimates it will receive fees of up to $2 million. The Board selected Moelis as its financial advisor in connection with the Merger because Moelis has substantial experience in similar transactions and familiarity with sector in which Altus Power is engaged. Moelis is regularly engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, strategic transactions, corporate restructurings, and valuations for corporate and other purposes.

Certain Financial Forecasts

The Company’s management prepares projections of the Company’s expected financial performance as part of its management of the business. Other than guidance in connection with its regularly scheduled earnings releases,

 

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as a matter of course, the Company does not publicly disclose any projections due to the inherent unpredictability of the underlying assumptions and estimates. However, the Company is including certain unaudited prospective financial information for the years 2025 through (and including) 2030, which we refer to as the “Company Forecasts” in this proxy statement in order to provide stockholders access to a summary of certain nonpublic, unaudited prospective financial information that was made available to the Board in connection with its consideration of the Merger, and was also provided by the Company to Moelis in connection with the rendering of its opinion to the Board and performing its related financial analyses.

In connection with the Board’s review of the Company’s strategic alternatives, including the consideration and evaluation of a potential transaction with Parent, the Senior Management prepared and provided the Company Forecasts to the Board. The Company Forecasts were reviewed by the Board and shared with Moelis. At the direction of the Board, Moelis used and relied upon the Company Forecasts in connection with its financial analyses and opinion, as summarized in the section entitled “The Merger—Fairness Opinion of Moelis & Company LLC” of this proxy statement. The Company Forecasts were not prepared with a view toward public disclosure and reflect subjective judgment in many respects and, therefore, are susceptible to multiple interpretations and do not reflect actual results or business developments after the date they were prepared.

The Company Forecasts were also provided to Parent in connection with its consideration of the potential transaction, as well as to other potential counterparties who executed confidentiality agreements and participated in the Company’s process. For these reasons, the Company has elected to summarize the Company Forecasts in this proxy statement.

The Company’s internal financial forecasts, such as the Company Forecasts, and the assumptions upon which the Company Forecasts were based, are subjective in many respects and thus subject to interpretation. Although presented with numerical specificity, the Company Forecasts are forward-looking statements and are based upon a variety of estimates and numerous assumptions made by the Company’s management with respect to, among other matters, industry performance, general business, economic, market, and financial conditions, and other matters, including the factors described under the section entitled “Cautionary Statement Regarding Forward-Looking Statements” of this proxy statement and other risk factors described in the Company’s filings with the SEC, many of which are difficult to predict, are inherently uncertain, are beyond the Company’s control, are subject to significant uncertainties, and may not reflect current prospects for the Company’s business, changes in general business, economic, market, and financial conditions, and other matters, transactions, or events that have occurred or that may occur and that were not anticipated when the Company Forecasts were prepared. In addition, since the Company Forecasts cover multiple years, such information, by its nature, becomes less reliable with each successive year. There can be no assurance that the estimates and assumptions made in preparing the Company Forecasts will prove accurate, that the projected results will be realized, or that actual results will not be significantly higher or lower than projected. In addition, the Company Forecasts do not take into account the Merger or any of the other Transactions that might also cause actual results to differ materially. The Company’s stockholders are urged to review the Company’s filings with the SEC for a description of the Company’s actual reported results of operations and financial condition.

The Company Forecasts are not intended to comply with, and include financial metrics that were not prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), the published guidelines of the SEC regarding financial projections, and the use of non-GAAP measures or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of financial projections and forecasts.

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared and presented in compliance with GAAP, and non-GAAP financial measures as used by the Company may not be comparable to similarly titled measures used by other companies. The non-GAAP financial measures used in the Company Forecasts were relied upon by Moelis for the purposes of its opinion and by our Board in connection with its consideration of the Merger. Financial measures included in projections provided to a financial advisor and a board of directors in connection with a business combination transaction, such as the

 

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Company Forecasts, are excluded from the definition of “non-GAAP financial measures” under the rules of the SEC, and therefore such projections are not subject to SEC rules regarding disclosures of non-GAAP financial measures, which would otherwise require a reconciliation of a non-GAAP financial measure to a GAAP financial measure. Reconciliations of non-GAAP financial measures were not relied upon by Moelis for purposes of its opinion, or by our Board in connection with its consideration of the Merger. Accordingly, we have not provided a reconciliation of the financial measures included in the Company Forecasts to the relevant GAAP financial measures. Neither Grant Thornton LLP, the Company’s independent registered public accounting firm, nor any other independent registered public accounting firm has examined, compiled, or performed any procedures with respect to the Company Forecasts, and, accordingly, neither Grant Thornton LLP nor any other public accounting firm expresses an opinion or any other form of assurance with respect to the Company Forecasts, and assume no responsibility for, and disclaim any association with, the prospective financial information. Reports by Grant Thornton LLP incorporated by reference into this proxy statement relate solely to the Company’s historical financial information. They do not extend to the prospective financial information and should not be read to do so.

The Company defines “Adjusted EBITDA” as net income adjusted for interest expense, depreciation, amortization and accretion expense, income tax expense, or benefit, acquisition, and entity formation costs, stock-based compensation expense, and excluding the effect of certain non-recurring items we do not consider to be indicative of our ongoing operating performance such as, but not limited to, gain or loss on fair value remeasurement of contingent consideration, gain or loss on disposal of property, plant, and equipment, change in fair value of redeemable warrant liability, change in fair value of Alignment Shares liability, loss on extinguishment of debt, net, and other miscellaneous items of other income and expenses. The Company uses Adjusted EBITDA because the Company believes it is useful to management, investors, and analysts in providing a measure of core financial performance adjusted to allow for comparisons of results of operations across reporting periods on a consistent basis. Factors in this determination include the exclusion of (1) variability due to gains or losses related to fair value remeasurement of contingent consideration and the change in fair value of redeemable warrant liability and Alignment Shares liability, (2) strategic decisions to acquire businesses, dispose of property, plant, and equipment or extinguish debt, and (3) the non-recurring nature of stock-based compensation and other miscellaneous items of income and expense, which affect results in a given period or periods. In addition, adjusted EBITDA represents the business performance of the Company before the application of statutory income tax rates and tax adjustments corresponding to the various jurisdictions in which the Company operates, as well as interest expense and depreciation, amortization and accretion expense, which are not representative of our ongoing operating performance. Adjusted EBITDA is also used by our management for internal planning purposes, including our consolidated operating budget, and by our board of directors in setting performance-based compensation targets.

None of the Company, the Board, Moelis, or any of their respective affiliates, advisors, or other representatives has made or makes any representation regarding the information included in the Company Forecasts. Stockholders and other readers of this proxy statement are cautioned not to rely unduly, if at all, on the Company Forecasts. Some or all of the assumptions that have been made regarding, among other things, the timing of certain occurrences or effects, may have changed since the date the Company Forecasts were prepared. The Company has not updated or otherwise revised, and does not intend to update or otherwise revise, the Company Forecasts to reflect circumstances existing after the date when prepared or to reflect the occurrence or non-occurrence of events after the date when prepared, even if any or all of the assumptions on which the Company Forecasts were based are shown to be inaccurate. Subject to the foregoing qualifications, set forth below is a summary of the Company Forecasts. Unlevered Free Cash Flow presented in the table below is calculated as Adjusted EBITDA, less capital expenditures and adjusted for tax equity proceeds, distributions and buyout cash flows and stock-based compensation (the Unlevered Free Cash Flow estimates provided by the Company to Parent were unburdened by stock-based compensation). As approved by Company management and authorized by the Company’s Board, an estimate of terminal year Adjusted EBITDA of $736 million was provided by the Company to Moelis for purposes of Moelis’ discounted cash flow analysis.

 

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(in millions)		2025P				2026P				2027P				2028P				2029P				2030P
Revenue		$	253			$	320			$	413			$	521			$	670			$	868
Adj. EBITDA		$	155			$	199			$	265			$	342			$	448			$	595
Unlevered Free Cash Flow		($	307	)		($	401	)		($	509	)		($	663	)		($	890	)		($	1,140	)

Interests of the Directors and Executive Officers of the Company in the Merger

When considering the recommendation of the Board with respect to the Merger Proposal, you should be aware that our directors and executive officers may have interests in the Merger that are different from, or in addition to, your interests as a stockholder. The Board was aware of these interests and considered them, among other matters, in evaluating and approving the Merger Agreement and the Merger and in recommending that the Merger Proposal be approved by our stockholders. See the sections entitled “The Merger—Background of the Merger” and “The Merger—Recommendation of the Board and Reasons for the Merger” of this proxy statement. You should take these interests into account in deciding whether to vote “FOR” the Merger Proposal.

These interests are described in more detail below. The dates used below to quantify these interests have been selected for illustrative purposes only and do not necessarily reflect the dates on which certain events occur.

Treatment of the Company Equity Awards, Company Stock Plan, and ESPP in the Merger

Certain directors and executive officers hold outstanding Company Compensatory Awards.

Under the Merger Agreement, except as otherwise agreed upon in writing between the applicable holder and Parent prior to the Effective Time, effective immediately prior to the Effective Time, each Company RSU Award and Company PSU Award will be treated as follows:

 

•

Each Vested Company RSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into the right to receive an amount in cash (without interest) equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Vested Company RSU Award by (b) the Merger Consideration, payable as soon as practicable following the Closing.

 

•

Each Unvested Company RSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into a Post-Closing Cash Award, equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Unvested Company RSU Award by (b) the Merger Consideration, and such Post-Closing Cash Award will vest and become payable pursuant to the same vesting schedule applicable to the Unvested Company RSU Award from which it was converted (including any accelerated vesting terms), subject to the holder’s continued employment with Parent and its subsidiaries (including the Surviving Corporation) through the applicable vesting date.

 

•

Each Company TSR PSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into a Post-Closing Cash Award, if any, equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Company TSR PSU Award (with the Merger Consideration used to determine the Company’s percentile rank relative to the applicable peer groups and such performance-based goals deemed to be achieved based on such relative percentile rank as of the date of the Merger Agreement) by (b) the Merger Consideration, and such Post-Closing Cash Award will vest and become payable pursuant to the same time-vesting schedule applicable to the Company TSR PSU Award from which it was converted (including any accelerated vesting terms), subject to the holder’s continued employment with Parent and its subsidiaries (including the Surviving Corporation) through the applicable vesting date.

 

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•

Each Company GW PSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into a Post-Closing Cash Award, if any, equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Company GW PSU Award (with any per share stock price performance-based goals deemed to be achieved based on the Merger Consideration) by (b) the Merger Consideration, and such Post-Closing Cash Award will vest and become payable pursuant to the same time-vesting schedule and based on the achievement of the same installed solar capacity goals applicable to the Company GW PSU Award from which it was converted (including any accelerated vesting terms), subject to the holder’s continued employment with Parent and its subsidiaries (including the Surviving Corporation) through the applicable vesting date.

 

•

Each Company Stock Price PSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time for no consideration.

All amounts payable with respect to the Company RSU Awards and Company PSU Awards will be subject to deduction for any required tax withholding.

Subject to the consummation of the Merger, the 2021 Plan will terminate effective immediately prior to the Effective Time.

Effective as of the date of the Merger Agreement, no participants have been (or will be) allowed to participate in the ESPP. Subject to the consummation of the Merger, the ESPP will terminate as of immediately prior to the Effective Time.

The following table sets forth, for each of our current and former executive officers and non-employee directors who served in such role at any point since January 1, 2024, the aggregate number of shares of Class A Common Stock and Class B Common Stock owned (directly or indirectly) or subject to outstanding Company Compensatory Awards (excluding Company Stock Price PSU Awards, which will be terminated and canceled for no consideration in connection with the Merger), in each case as of February 14, 2025.

 

Name		Performance Stock Units (#)(1)				Value of Performance Stock Units ($)(2)				Restricted Stock Units (#)				Value of Restricted Stock Units ($)(2)				Shares of Common Stock (#)				Value of Common Stock ($)(2)
Executive Officers
Gregg Felton			206,955			$	1,034,775				1,376,317			$	6,881,585				12,166,973			$	60,834,865
Anthony Savino			110,781			$	553,907				416,091			$	2,080,455				3,542,562			$	17,712,810
Dustin Weber			113,408			$	567,040				308,823			$	1,544,115				1,542,951			$	7,714,755
Lars Norell(3)(4)			—				—				—				—				6,598,766			$	32,993,830
Non-Employee Directors
Christine Detrick			—				—				111,111			$	555,555				167,779			$	838,895
Robert Horn			—				—				—				—				—				0
Richard Peretz			—				—				76,832			$	384,160				57,788			$	288,940
Tina Reich			—				—				39,413			$	197,065				20,136			$	100,680
Robert Bernard(5)			—				—				44,410			$	222,050				0				0
Richard Shapiro			—				—				48,357			$	241,785				0				0
William Concannon(3)(6)			—				—				—				—				199,667			$	998,335
Diane Brink(3)(7)			—				—				—				—				—				0

 

(1)

The number of outstanding performance stock units includes the number of units that will achieve applicable performance goals based on the Merger Consideration (but which have not satisfied service-vesting conditions), and assumes that installed solar capacity goals applicable to Company GW PSU Awards are achieved. As mentioned above, Company Stock Price PSU Awards will be canceled for no consideration, and therefore are not included in this table.

 

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(2)	Dollar values are calculated based on the Merger Consideration of $5.00 per share.

(3)

Ms. Brink and Messrs. Norell and Concannon are no longer providing services to the Company; accordingly, information related to their current ownership of Class A Common Stock is not readily determinable. For Ms. Brink and Mr. Concannon, the information related to each individual’s ownership of Class A Common Stock set forth in this table is as of the last day the applicable individual was employed or engaged by the Company.

(4)	As reported on a Schedule 13D/A filed on February 7, 2025, Mr. Norell is the beneficial owner of 6,598,766 shares.

(5)	Mr. Bernard has transferred all Company RSU Awards granted to him to CBRE Acquisition Sponsor, LLC.

(6)	As reported on a DEF 14A filed on April 12, 2023. William Concannon is the beneficial owner of 199,647 shares.

(7)	As reported on a DEF 14A filed on April 12, 2023. Diane Brink is the beneficial owner of 0 shares.

Director and Executive Officer Compensation Arrangements

Employment Agreements; Restrictive Covenant Agreements; Equity Award Agreements

Each of Messrs. Felton and Weber has entered into an employment agreement with the Company (each, an “Employment Agreement”).

Under his Employment Agreement, Mr. Felton is eligible to receive the following payments and benefits if his employment is terminated by the Company without “cause” or if he resigns for “good reason” (as such terms are defined in the Employment Agreement): (a) 12 months’ base salary continuation at the rate in effect at the time of such termination of employment; (b) Company-subsidized health continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 for 12 months following such termination of employment or, if earlier, until he becomes eligible for medical benefits from a subsequent employer; (c) any earned but unpaid bonus for the year prior to the year in which such termination occurs; and (d) a prorated bonus for the year in which such termination occurs, based on actual performance, subject, in each case, to his execution of a release of claims and continued compliance with restrictive covenants in favor of the Company.

Under his Employment Agreement, Mr. Weber is eligible to receive continued payment of base salary and provision of health and dental benefits following his termination of employment during the period that the Company intends to enforce the non-competition covenant under his Employment Agreement (up to six months post-termination).

In addition, each of Messrs Felton, Weber, and Savino have entered into a Confidential Information, Inventions, and Proprietary Rights Agreement with the Company (each, a “Restrictive Covenant Agreement”) pursuant to which the executive officer is eligible to receive continued payment of base salary and provision of health and dental benefits following the executive officer’s termination of employment during the period that the Company intends to enforce the non-competition covenant thereunder (up to 12 months post-termination). Any such payments and benefits under an executive officer’s Restrictive Covenant Agreement will be offset by any severance payments and benefits the Company otherwise is required to provide under his Employment Agreement or otherwise.

The current executives’ equity award agreements also provide for vesting in full (to the extent then-unvested) upon a termination of employment by the Company without “cause” (as defined in the 2021 Plan) within 12 months following a change in control of the Company. The current directors’ equity award agreements provide for vesting in full (to the extent then-unvested) upon a change in control of the Company.

2024 Annual Bonuses

The Merger Agreement provides that in the event the Closing occurs prior to the payment of bonuses under the Company’s 2024 bonus program, Parent will cause each continuing employee, including each current executive,

 

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to be paid such employee’s 2024 annual bonus pursuant to the terms and conditions set forth in such program consistent with the Company’s past practice. The annual bonuses will be paid no later than April 10, 2025, subject to the employee’s continued employment through the payment date, except that an employee will remain entitled to receive such employee’s 2024 bonus if the employee dies or incurs a termination of employment without “cause” or due to the employee’s “disability” (each such term as defined in the 2021 Plan), in any case, prior to the payment date.

Transaction Bonuses

On February 4, 2025, in connection with the Merger, the Compensation Committee of the Board (the “Compensation Committee”) recommended to the Board, and the Board approved, cash payments of $60,000 and $20,000 to each of Christine Detrick and Richard Peretz, respectively, who served on the Transaction Committee of the Board, payable on or about March 28, 2025.

On February 5, 2025, in connection with the Merger, the Compensation Committee approved transaction bonus awards for certain Company employees, including each of our current executive officers. Each transaction bonus will be made pursuant to a transaction bonus agreement with the Company and is payable upon the consummation of the Merger, subject to the executive’s continued service through the Closing. The transaction bonus amounts for our executives are set forth in the table below.

 

Name		Transaction Bonus
Gregg Felton		$	572,500
Dustin Weber		$	500,000
Anthony Savino		$	175,000

2025 Company RSU Awards

On February 5, 2025, the Compensation Committee approved our current executives’ annual bonuses with respect to 2024. Consistent with past practice, our executives’ bonuses were approved in the form of Company RSU Awards, which will be subject to time-based vesting over two years, with 50% of the award vesting on each of the first two anniversaries of the grant date (expected to be March 28, 2025), subject to the executive’s continued employment through the applicable vesting date. The number of shares subject to these Company RSU Awards will be determined by dividing the dollar-denominated value (set forth in the table below) by the Merger Consideration.

 

Name		STI RSU Award
Gregg Felton		$	516,937
Dustin Weber		$	309,914
Anthony Savino		$	309,914

On February 5, 2025, the Compensation Committee also approved annual Company RSU Awards for employees, including our named executive officers. Such Company RSU Awards will be subject to time-based vesting over three years, with one-third of the award vesting on each of the first, second, and third anniversaries of the grant date (expected to be March 28, 2025), subject to the employee’s continued service through the applicable vesting date. The number of shares subject to these Company RSU Awards will be determined by dividing the dollar-denominated value (set forth in the table below) by the Merger Consideration.

 

Name		Annual RSU Award
Gregg Felton		$	2,310,000
Dustin Weber		$	1,293,000
Anthony Savino		$	1,265,000

Each of the Company RSU Awards granted in 2025 will be subject to the treatment of Company RSU Awards described above under “—Treatment of the Company Equity Awards, Company Stock Plan, and ESPP in the Merger.”

 

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Employee Benefits

The Merger Agreement requires Parent (or the Surviving Corporation) to provide certain compensation and benefits for a period of 12 months following the Effective Time for continuing employees of the Company, and to take certain actions in respect of employee benefits provided to such continuing employees, including its executive officers. For a detailed description of these requirements, please see the section entitled “Proposal No.  1: The Merger Proposal—Employee Matters” of this proxy statement.

Insurance and Indemnification of Directors and Executive Officers

Parent has agreed that it will cause the Surviving Corporation to take all actions necessary or appropriate to ensure that, from and after the Effective Time, all rights to indemnification, exculpation, and advancement of expenses now existing in favor of (a) each present and former director, officer, and employee of the Company and its subsidiaries against any costs or expenses (including reasonable attorneys’ fees), judgments, fines, losses, claims, damages, or liabilities incurred in connection with any claim, action, suit, proceeding, or investigation, whether civil, criminal, administrative, or investigative, arising out of or pertaining to matters existing or occurring at or prior to the Effective Time, whether asserted or claimed prior to, at or after the Effective Time, to the fullest extent permitted under or required by applicable law or the respective certificates of incorporation, bylaws, or other organizational documents of the Company or its subsidiaries, as applicable, or indemnification agreements to which the Company or its subsidiaries, as applicable, are a party or otherwise bound, in each case as in effect on the date of the Merger Agreement, and (b) each person entitled to such indemnification or exculpation under the provisions of the contracts set forth on the Company Disclosure Letter to the fullest extent permitted thereunder, in each case, will continue in full force and effect in accordance with its terms.

The Company may purchase a pre-paid, non-cancelable six-year “tail” policy (containing terms not less favorable than the terms of such current insurance coverage), of directors’ and officers’ liability insurance with respect to matters existing or occurring at or before the Effective Time. If the Company does not purchase such “tail” policy, Parent may cause the Surviving Corporation to do so.

Rollover Shares

Pursuant to the Merger Agreement and that certain Rollover Agreement, dated February 5, 2025, by and among the Rollover Stockholders and Parent, the Rollover Stockholders will, immediately prior to the Effective Time, contribute to Parent certain of their respective Rollover Shares in exchange for newly issued equity interests of Parent in accordance with the terms of the Rollover Agreement.

In addition, the Rollover Agreement provides that the Rollover RSUs held by Gregg Felton will be converted into awards that will be settled in equity interests of Parent pursuant to the terms and conditions of a separate agreement between Parent and Mr. Felton.

Financing of the Merger

The Merger Agreement is not conditioned upon receipt of financing by Parent. We anticipate that the total amount of funds necessary to consummate the Merger and the other Transactions, not including fees and expenses, will be approximately $905,371,158, including the estimated funds needed to (a) pay our stockholders the Merger Consideration due to them under the Merger Agreement; (b) make payments in respect of outstanding Company RSU Awards pursuant to the Merger Agreement; and (c) pay, redeem, or otherwise terminate any outstanding net indebtedness of the Company as of Closing.

Pursuant to the Equity Commitment Letter, the TPG Guarantor has committed, subject to the terms and conditions set forth therein, to capitalize Parent in an aggregate amount of up to $920,371,158 at or prior to the Closing. The proceeds from the Equity Financing will be used to fund: (a) the payment of the aggregate Merger

 

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Consideration and RSU Consideration to which holders of Company’s common stock and Company Compensatory Awards will be entitled at the Effective Time pursuant to the Merger Agreement; (b) the repayment of the APAGH Term Loan (as defined in the Merger Agreement) and outstanding borrowings under the APAG Revolver (as defined in the Merger Agreement) as of the date of the Equity Commitment Letter (including principal, interest, premiums, fees, and charges related thereto) unless such facilities are refinanced or applicable lender consents are received prior to the Closing; and (c) the payment of all fees and expenses to be paid by Parent or Merger Sub in connection with the Transactions.

Additionally, Parent has obtained the Debt Commitment Letter for the purpose of (a) the Refinancing the APAGH Term Loan concurrently with the Closing of the Merger and the other Transactions, (b) paying fees and expenses incurred in connection with the Refinancing and the transactions related thereto and (c) making distributions to indirectly cover a portion of the Merger Consideration.

The TPG Guarantor has also provided a Limited Guaranty with respect to the payment of the termination fee payable by Parent pursuant to the Merger Agreement, and certain associates fees and expenses, in the event such termination fee becomes payable, subject to the terms and conditions set forth in the Merger Agreement and the Limited Guaranty.

The Merger Agreement provides that Parent will use reasonable best efforts to take, or cause to be taken, all actions and do, or cause to be done, all things necessary or advisable to consummate the Equity Financing on or prior to the Closing Date in accordance with the terms, and subject to the conditions, set forth in the Equity Commitment Letter. The Merger is not conditioned on Parent’s or Merger Sub’s receipt of the Committed Debt Financing or the Equity Financing.

Financing Cooperation

Prior to the consummation of the Merger, the Company has agreed to, and to cause each of its subsidiaries to, use its reasonable best efforts to provide customary or necessary cooperation in connection with obtaining the Committed Debt Financing and the refinancing or extension of the maturity of the APAG Revolver (collectively, the “Debt Financing”) as the Parent may reasonably request, including, among other enumerated assistance, assisting Parent in connection with (a) the process of obtaining the Other Debt Consents (as defined under the section entitled “Proposal No. 1: The Merger Proposal—Conduct of Business Pending the Merger” of this proxy statement), (b) if any such Other Debt Consent is not obtained, as applicable, or any of the APAGH Term Loan or APAG Revolver (each, as defined in the Merger Agreement) is not refinanced prior to the Closing Date, as applicable: (w) the process of prepayment and termination of the APAGH Term Loan, (x) the process of prepayment and termination of the APAG Revolver, (y) the extension of the maturity of the APAG Revolver on terms reasonably satisfactory to Parent or (z) the process of cash collateralizing certain letters of credit under the API L/C Facility (as defined in the Merger Agreement) and (c) replacing certain other letters of credit with new letters of credit under the APAG Revolver or another facility.

The Company has the right to review and comment on marketing materials used in connection with the arrangement of the Debt Financing prior to the dissemination of such materials to potential lenders or other counterparties to any proposed financing transaction (or filing with any governmental authority); provided, that the Company must communicate in writing its comments, if any, to Parent and its counsel within a reasonable period of time. The Company will not be required to agree to any contractual obligation relating to the Debt Financing that is not effective or conditioned upon the Closing or that does not terminate without liability to the Company and its affiliates upon the termination of the Merger Agreement.

Pursuant to the Merger Agreement, Parent is required to indemnify and hold harmless the Company and its subsidiaries, and each of their respective representatives, from and against any and all liabilities, costs, or expenses suffered or incurred in connection with the its or their cooperation related to the Debt Financing or any information, assistance, or activities provided in connection therewith, in each case, except to the extent that any

 

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such liabilities, costs, or expenses are suffered or incurred as a result of the Company’s (or any of its subsidiaries’) gross negligence, bad faith, fraud, willful misconduct, material breach of the Merger Agreement, or arise out of a material misstatement in or failure to state a material fact pertinent to the information provided by or on behalf of the Company pursuant to the Merger Agreement, as applicable. Parent is required to promptly reimburse Company and its subsidiaries for any and all reasonable and documented out-of-pocket third-party costs and expenses incurred by Company or its subsidiaries and each of their respective representatives in connection with their cooperation in connection with the Debt Financing or such assistance. Obtaining the Debt Financing is not a condition to closing of the Merger.

Parent shall consult with and keep the Company informed in reasonable detail of the status of Parent’s efforts to arrange the Equity Financing and the Debt Financing.

Closing and Effective Time of the Merger

Subject to the terms and conditions of the Merger Agreement, the closing of the Merger will take place at the offices of Latham & Watkins LLP, 811 Main Street, Suite 3700, Houston, TX 77002, at 9:00 a.m. EDT on the date that is five business days after the date on which all of the closing conditions set forth in the Merger Agreement (described under the section entitled “Proposal No. 1: The Merger Proposal—Conditions to the Merger” of this proxy statement) have been satisfied or waived (other than those conditions that by their terms are to be satisfied immediately prior to or at the Closing, but subject to the satisfaction or waiver of such conditions), unless another time, date, or place is agreed to by the Company and Parent.

Concurrently with, or as promptly as practicable after, the Closing, the parties to the Merger Agreement will cause to be filed with the Delaware Secretary of State, a duly completed and executed certificate of merger with respect to the Merger in accordance with the DGCL. The Merger will become effective upon the filing of such certificate of merger, or at such later date and time as is agreed by Parent and the Company and specified in such certificate of merger.

Anticipated Accounting Treatment of the Merger

The Merger will be accounted by Parent as a “business combination” for financial accounting purposes.

Appraisal Rights

If the Merger is consummated, record holders and beneficial owners of Class A Common Stock who do not vote in favor of the Merger (whether by voting against the Merger, abstaining, or otherwise not voting with respect to the Merger), who properly demand an appraisal of their shares, who continuously hold (in the case of holders of record) or continuously own (in the case of beneficial owners) their shares of Company Shares through the effective date of the Merger, who otherwise comply with the statutory requirements of Section 262, and who do not withdraw their demands or otherwise lose their rights to appraisal, subject to the conditions thereof, are entitled to seek appraisal of their shares in connection with the Merger under Section 262 and to receive payment in cash for the fair value of their shares of Class A Common Stock as determined by the Delaware Court of Chancery, together with interest, if any, as determined by the Court, in lieu of the consideration such record holder or beneficial owner would otherwise be entitled to pursuant to the Merger Agreement, subject to the requirements and limitations set forth in Section 262 described herein. These rights are known as appraisal rights. Stockholders and beneficial owners electing to exercise appraisal rights must comply with the provisions of Section 262 in order to perfect their rights. Strict compliance with the statutory procedures is required to perfect appraisal rights under Delaware law.

The following discussion is not a complete statement of the law pertaining to appraisal rights under the DGCL and is qualified in its entirety by the full text of Section 262, which is attached to this proxy statement as Appendix B. The full text of Section 262 is also accessible at the following publicly available website: https://delcode.delaware.gov/title8/c001/sc09/index.html#262 and incorporated by reference herein. All

 

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references in Section 262 and in this summary to “stockholder” (and all references in this summary to “holder”) are to the record holder of the shares of Class A Common Stock immediately prior to the Effective Time as to which appraisal rights are asserted. All references within Section 262 and this summary to “beneficial owner” mean the beneficial owner of shares of Class A Common Stock held either in voting trust or by a nominee on behalf of such person. Failure to comply strictly with the procedures set forth in Section 262 will result in the loss of appraisal rights. The following summary does not constitute any legal or other advice nor does it constitute a recommendation that stockholders exercise their appraisal rights under Section 262.

Under Section 262, record holders and beneficial owners of shares of Class A Common Stock who make the demand described below with respect to such shares, do not vote in favor of the Merger Proposal, continuously hold such shares through the Effective Time, and otherwise comply with the statutory requirements of Section 262 will be entitled to an appraisal of their shares of Class A Common Stock and to receive payment in cash for the fair value of their shares as of the Effective Time, exclusive of any element of value arising from the accomplishment or expectation of the Merger, as determined by the Delaware Court of Chancery, together with interest, if any, to be paid upon the amount determined to be fair value. The “fair value” of the shares of Class A Common Stock as determined by the Delaware Court of Chancery may be more than, less than, or equal to the Merger Consideration per share that holders thereof are otherwise entitled to receive under the terms of the Merger Agreement. Stockholders and beneficial owners should be aware that an investment banking opinion as to the fairness, from a financial point of view, of the consideration payable in a sale transaction, such as the Merger, is not an opinion as to, and does not otherwise address “fair value” under Section 262.

Under Section 262, when a merger agreement is to be submitted by a corporation’s board of directors for adoption at a meeting of such corporation’s stockholders, not less than 20 days before such meeting, the corporation submitting the matter to a vote of stockholders must notify the stockholders who were stockholders on the record date for notice of such meeting with respect to shares for which appraisal rights will be available pursuant to Section 262 that such appraisal rights will be available. A copy of Section 262 must be included with such notice. This proxy statement constitutes the Company’s notice to its stockholders and beneficial owners that appraisal rights are available in connection with the Merger and the full text of Section 262 is attached to this proxy statement as Appendix B, in compliance with the requirements of Section 262. Record holders and beneficial owners who wish to exercise such appraisal rights should carefully review the text of Section 262 contained in Appendix B. Failure to comply timely and properly with the requirements of Section 262 may result in the loss of such holder’s or beneficial owner’s appraisal rights under the DGCL. Moreover, because of the complexity of the procedures for exercising appraisal rights, the Company believes that a stockholder or beneficial owner considering the exercise of such rights should seek the advice of legal counsel.

If you are a Company stockholder or beneficial owner and wish to exercise the right to seek an appraisal of your shares of Company, you must satisfy each of the following conditions:

 

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You must deliver to the Company a written demand for appraisal before the vote on the Merger Agreement at the Special Meeting. This written demand for appraisal must be in addition to and separate from any proxy or vote abstaining from, voting against, or otherwise failing to vote for the adoption of the Merger Agreement. Voting against or failing to vote for the adoption of the Merger Agreement by itself does not constitute a demand for appraisal within the meaning of Section 262. The demand must reasonably inform us of the identity of the stockholder of record holding the shares for which appraisal is demanded, the intention of the person to demand appraisal of his, her, their, or its shares, and, in case of a demand made by a beneficial owner, must be accompanied by documentary evidence of such beneficial owner’s beneficial ownership of the shares and a statement that such documentary evidence is a true and correct copy of what it purports to be and must provide an address at which such beneficial owner consents to receive notices given by the Surviving Corporation under Section 262 and to be set forth on the verified list required by Section 262(f) of the DGCL. A stockholder’s and beneficial owner’s failure to make a written demand for appraisal before the vote with respect to the Merger is taken will constitute a waiver of appraisal rights;

 

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•

You must not vote in favor of, or consent in writing to, the adoption of the Merger Agreement with respect to such shares. A vote in favor of the adoption of the Merger Agreement, whether by proxy submitted by mail, over the Internet, or by telephone or at the Special Meeting, will constitute a waiver of your appraisal rights in respect of the shares so voted and will nullify any previously filed written demands for appraisal. A proxy which does not contain voting instructions will, unless revoked, be voted in favor of the adoption of the Merger Agreement. Therefore, a stockholder who submits a proxy voting in favor of the adoption of the Merger Agreement or a proxy which does not contain voting instructions (which, unless revoked, will be voted in favor of the adoption of the Merger Agreement) and who wishes to exercise appraisal rights must effectively revoke that proxy pursuant to one of the means described in this proxy statement;

 

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You must continuously hold (in the case of a stockholder demanding appraisal) or beneficially own (in the case of a beneficial owner demanding your appraisal) your shares of Class A Common Stock from the date of making the demand through the Effective Time. You will lose your appraisal rights if you are a stockholder of record and transfer the shares, of if you are a beneficial own and cease to beneficially own such shares, before the Effective Time;

 

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Any stockholder or beneficial owner who has complied with the requirements of Section 262 or the Company must file a petition in the Delaware Court of Chancery requesting a determination of the fair value of the shares within 120 days after the Effective Time. The Company is under no obligation to file any petition and has no present intention of doing so; and

 

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You must otherwise comply with the applicable procedures and requirements set forth in Section 262.

If you fail to comply with any of these conditions and the Merger is completed, you will be entitled to receive the Merger Consideration, but you will have no appraisal rights with respect to your shares of Class A Common Stock.

A proxy that is submitted and does not contain voting instructions will, unless properly revoked, be voted “FOR” the Merger Proposal, and it may result in the loss of the stockholder’s right of appraisal and nullify any previously delivered written demand for appraisal. Therefore, a stockholder who submits a proxy and who wishes to exercise appraisal rights must either submit a proxy containing instructions to vote “AGAINST” the Merger Proposal or “ABSTAIN” from voting on the Merger Proposal. Voting against or failing to vote on the Merger Proposal by itself does not constitute a demand for appraisal within the meaning of Section 262. The written demand for appraisal must be in addition to and separate from any proxy or vote on the Merger Proposal.

All demands for appraisal should be addressed to:

Altus Power, Inc.

2200 Atlantic Street, Sixth Floor

Stamford, CT 06902

Attention: Corporate Secretary

Only a holder of record or beneficial owner of shares of Class A Common Stock may assert appraisal rights for the shares of Class A Common Stock registered in that holder’s name. A demand for appraisal must be executed by or on behalf of the stockholder of record or beneficial owner of the shares. The demand must reasonably inform the Company of the identity of the record holder of the shares and that the stockholder or beneficial owner intends to demand appraisal of his, her, their, or its Class A Common Stock. In addition, if a demand is made by a beneficial owner, the demand must also (a) reasonably identify the holder of record of the shares for which the demand is made, (b) provide documentary evidence of such beneficial owner’s beneficial ownership and a statement that such documentary evidence is a true and correct copy of what it purports to be, and (c) provide an address at which such beneficial owner consents to receive notices given by the Company and the office of Register in Chancery and to be set forth on the verified list required by Section 262(f) of the DGCL. A holder of record, such as a bank, broker, or other nominee, who holds shares of Class A Common Stock as a

 

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nominee or intermediary for others, may exercise his, her, their, or its right of appraisal with respect to the shares of Class A Common Stock held for one or more beneficial owners, while not exercising this right for other beneficial owners. In that case, the written demand should state the number of shares of Class A Common Stock as to which appraisal is sought. Where no number of shares of Class A Common Stock is expressly mentioned, the demand will be presumed to cover all shares of Class A Common Stock held in the name of the holder of record or beneficially owned by the beneficial owner.

If you own shares of Class A Common Stock jointly with one or more other persons, as in a joint tenancy or tenancy in common, demand for appraisal should be executed by or for you and all other joint owners. An authorized agent, including an agent for two or more joint owners, may execute the demand for appraisal for a stockholder of record or beneficial owner; however, the agent must identify the holder or holders of record (and, if by an authorized agent of any beneficial owner or owners, must identify the beneficial owner or owners and otherwise comply with the requirements applicable to appraisal demands made by beneficial owners) and expressly disclose the fact that, in exercising the demand, such person is acting as agent.

If the Merger is consummated, then within 10 days after the Effective Time, the Surviving Corporation in the Merger must give written notice of the Effective Time to each stockholder and beneficial owner who has demanded appraisal in accordance with Section 262 and who did not vote in favor of the Merger Proposal. At any time within 60 days after the Effective Time, any stockholder or beneficial owner who has not commenced an appraisal proceeding or joined a proceeding as a named party may withdraw the stockholder’s or beneficial owner’s demand and accept the Merger Consideration, without interest and minus any applicable withholding taxes, for that holder’s shares of Class A Common Stock by delivering to the Surviving Corporation a written withdrawal of the demand for appraisal. However, any such attempt to withdraw the demand made more than 60 days after the Effective Time will require written approval of the Surviving Corporation. No appraisal proceeding in the Delaware Court of Chancery will be dismissed as to any stockholder or beneficial owner without the approval of the Delaware Court of Chancery, with such approval conditioned upon such terms as the Delaware Court of Chancery deems just. If the Surviving Corporation does not approve a request to withdraw a demand for appraisal when that approval is required, or, except with respect to any stockholder or beneficial owner who withdraws such person’s right to appraisal in accordance with the proviso in the immediately preceding sentence, if the Delaware Court of Chancery does not approve the dismissal of an appraisal proceeding, the stockholder or beneficial owner will be entitled to receive only the appraised value of his, her, their, or its shares of Class A Common Stock determined in any such appraisal proceeding, which value may be more than, less than, or equal to the Merger Consideration per share, without interest and minus any applicable withholding taxes.

Within 120 days after the Effective Time, but not thereafter, either the Surviving Corporation or any stockholder or beneficial owner who has complied with the requirements of Section 262 and is entitled to appraisal rights under Section 262 may commence an appraisal proceeding by filing a petition in the Delaware Court of Chancery demanding a determination of the fair value of the shares held by all such stockholders and beneficial owners. Upon the filing of the petition by a stockholder or beneficial owner, service of a copy of such petition will be made upon the Surviving Corporation. The Surviving Corporation has no obligation to file such petition and has no present intention to file a petition and holders should not assume that the Surviving Corporation will file a petition. In the event that the Surviving Corporation does not file such petition, it is the obligation of the stockholders or beneficial owners of Class A Common Stock who have complied with the requirements of Section 262 to initiate all necessary action to perfect their appraisal rights with respect to shares within the time prescribed in Section 262. In addition, within 120 days after the Effective Time, any stockholder or beneficial owner who has theretofore complied with the applicable provisions of Section 262 will be entitled to receive from the Surviving Corporation, upon written request, a statement setting forth the aggregate number of shares not voted in favor of the Merger Proposal and with respect to which demands for appraisal have been received and the aggregate number of holders or beneficial owners holding or owning those shares (for which purpose the record holder of shares held by a beneficial owner who has made a demand for appraisal shall not be considered a separate stockholder holding such shares). The statement must be given within the later of (a) 10 days after such written request has been received by the Surviving Corporation or (b) 10 days after the expiration of the period for delivery of demands for appraisal.

 

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If a petition for appraisal is duly filed by a stockholder and a copy of the petition is delivered to the Surviving Corporation, then the Surviving Corporation will be obligated, within 20 days after receiving service of a copy of the petition, to file with the Delaware Register in Chancery in which the petition was filed a duly verified list containing the names and addresses of all stockholders and beneficial owners who have demanded an appraisal of their shares and with whom agreements as to the value of their shares have not been reached. After notice to stockholders and beneficial owners who have demanded appraisal from the Delaware Register in Chancery, if such notice is ordered by the Delaware Court of Chancery, the Delaware Court of Chancery will conduct a hearing upon the petition and determine those stockholders and beneficial owners who have complied with Section 262 and who have become entitled to the appraisal rights provided by Section 262. Additionally, because the Class A Common Stock will have been publicly listed on the NYSE, the Delaware Court of Chancery is required under Section 262 to dismiss the proceedings as to all holders of such shares who are otherwise entitled to appraisal rights unless (a) the total number of shares entitled to appraisal exceeds 1% of the outstanding shares of Class A Common Stock or (b) the value of the Merger Consideration for such total number of shares of Class A Common Stock exceeds $1 million.

After determination of the stockholders and beneficial owners entitled to appraisal of their shares, the Delaware Court of Chancery will appraise the shares, determining their fair value as of the Effective Time after taking into account all relevant factors exclusive of any element of value arising from the accomplishment or expectation of the Merger, together with interest, if any, to be paid upon the amount determined to be the fair value. When the fair value has been determined, the Delaware Court of Chancery will direct the payment of such value by the Surviving Corporation to the stockholders and beneficial owners entitled thereto. Unless the Delaware Court of Chancery in its discretion determines otherwise for good cause shown, and except as provided in the following sentence, interest from the Effective Time through the date of payment of the judgment will be compounded quarterly and will accrue at 5% over the Federal Reserve discount rate (including any surcharge) as established from time to time during the period between the Effective Time and the date of payment of the judgment. At any time before the entry of judgment in the appraisal proceeding, the Surviving Corporation may pay to each person entitled to appraisal an amount in cash, in which case interest will accrue thereafter as provided in the preceding sentence only upon the sum of (a) the difference, if any, between the amount so paid and the fair value of shares as determined by the Delaware Court of Chancery and (b) interest theretofore accrued, unless paid at that time.

Neither the Company nor Parent anticipates offering more than the Merger Consideration provided for in the Merger Agreement to any stockholder or beneficial owner exercising appraisal rights and they reserve the right to assert, in any appraisal proceeding, that, for purposes of Section 262, the “fair value” of a share of the Class A Common Stock is less than the per share Merger Consideration. In determining “fair value,” the Delaware Court of Chancery is required to take into account all relevant factors. In Weinberger v. UOP, Inc., 457 A.2d 701 (Del. 1983), the Delaware Supreme Court discussed the factors that could be considered in determining fair value in an appraisal proceeding, stating that “proof of value by any techniques or methods which are generally considered acceptable in the financial community and otherwise admissible in court” should be considered and that “[f]air price obviously requires consideration of all relevant factors involving the value of a company.” The Delaware Supreme Court has stated that in making this determination of fair value, the court must consider market value, asset value, dividends, earnings prospects, the nature of the enterprise, and any other facts that could be ascertained as of the date of the merger that throw any light on future prospects of the merged corporation. Section 262 provides that fair value is to be “exclusive of any element of value arising from the accomplishment or expectation of the merger.” In Cede & Co. v. Technicolor, Inc., 634 A.2d 345 (Del. 1993), the Delaware Supreme Court stated that such exclusion is a “narrow exclusion [that] does not encompass known elements of value,” but which rather applies only to the speculative elements of value arising from such accomplishment or expectation. In Weinberger, the Delaware Supreme Court also stated that “elements of future value, including the nature of the enterprise, which are known or susceptible of proof as of the date of the merger and not the product of speculation, may be considered.”

Costs of the appraisal proceeding (which do not include attorneys’ fees or the fees and expenses of experts) may be determined by the Delaware Court of Chancery and imposed upon the Surviving Corporation and the

 

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stockholders and beneficial owners participating in the appraisal proceeding by the Delaware Court of Chancery, as it deems equitable in the circumstances. Each dissenting stockholder or beneficial owner is responsible for his, her, their, or its attorneys and expert witness expenses, although upon the application of a dissenting stockholder or beneficial owner, the Delaware Court of Chancery may order all or a portion of the expenses incurred by any stockholder or beneficial owner in connection with the appraisal proceeding, including, without limitation, reasonable attorneys’ fees and the fees and expenses of experts used in the appraisal proceeding, to be charged pro rata against the value of all shares entitled to appraisal. Any stockholder or beneficial owner who demanded appraisal rights will not, after the Effective Time, be entitled to vote shares subject to that demand for any purpose or to receive payments of dividends or any other distribution with respect to those shares other than with respect to any such payment as of the Record Date prior to the Effective Time.

At any time within 60 days after the Effective Time, any stockholder or beneficial owner who has not commenced an appraisal proceeding or joined that proceeding as a named party will have the right to withdraw such demand for appraisal and to accept the terms offered in the Merger; after this period, the stockholder or beneficial owner may withdraw such demand for appraisal only with the consent of the Surviving Corporation. If no petition for appraisal is filed with the Delaware Court of Chancery within 120 days after the Effective Time, or if the stockholder or beneficial owner otherwise fails to perfect, successfully withdraws, or loses such holder’s right to appraisal, then the stockholder’s right to appraisal will cease, and such stockholder or beneficial owner will be entitled to receive the Merger Consideration, without interest and minus any applicable withholding taxes. Inasmuch as the Surviving Corporation has no obligation to file such a petition, and has no present intention to do so, any record or beneficial holder of shares who desires such a petition to be filed is advised to file it on a timely basis. As indicated above, any stockholder or beneficial owner may withdraw such stockholder’s or beneficial owner’s demand for appraisal by delivering to the Surviving Corporation a written withdrawal of his, her, their, or its demand for appraisal and acceptance of the Merger Consideration, without interest and less any applicable withholding taxes, except (a) that any such attempt to withdraw made more than 60 days after the Effective Time will require written approval of the Surviving Corporation and (b) that no appraisal proceeding in the Delaware Court of Chancery will be dismissed as to any stockholder or beneficial owner without the approval of the Delaware Court of Chancery, and such approval may be conditioned upon such terms as the Delaware Court of Chancery deems just, provided, however, that the preceding clause (b) will not affect the right of any stockholder or beneficial owner who has not commenced an appraisal proceeding or joined that proceeding as a named party to withdraw such stockholder’s or beneficial owner’s demand for appraisal and to accept the Merger Consideration, without interest and less any applicable withholding taxes, on terms offered upon the Merger within 60 days after the Effective Time.

Failure to comply strictly with all of the procedures set forth in Section 262 may result in the loss of a stockholder’s or beneficial owner’s statutory appraisal rights.

Material U.S. Federal Income Tax Consequences of the Merger to Holders of Class A Common Stock

The following discussion is a summary of the material U.S. federal income tax consequences of the Merger that generally are relevant to holders of shares of Class A Common Stock whose shares are converted into the right to receive cash pursuant to the Merger, but does not purport to be a complete analysis or description of all potential tax effects of the Merger. This discussion is based upon the Internal Revenue Code of 1986, as amended (the “Code”), Treasury Regulations promulgated under the Code, court decisions, published positions of the Internal Revenue Service (the “IRS”), and other applicable authorities, all as in effect on the date of this proxy statement and all of which are subject to change or differing interpretations, possibly with retroactive effect. Any such change or differing interpretation could affect the accuracy of the statements and conclusions set forth in this discussion. This discussion is limited to holders who hold their shares of Class A Common Stock as “capital assets” within the meaning of Section 1221 of the Code (generally, property held for investment purposes). This summary does not describe any of the tax consequences arising under the laws of any state, local, or foreign tax jurisdiction and does not consider any aspects of U.S. federal tax law other than income taxation (e.g., estate, gift, or alternative minimum tax or the Medicare net investment income surtax). In addition, this summary does

 

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not address the U.S. federal income tax consequences to holders of shares who exercise appraisal rights under the DGCL. For purposes of this discussion, a “holder” means either a U.S. Holder or a Non-U.S. Holder or both, as the context may require.

This discussion is for general information only and does not address all of the tax consequences that may be relevant to holders in light of their particular circumstances, including, without limitation:

 

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banks, insurance companies, and other financial institutions;

 

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mutual funds;

 

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brokers or dealers in securities, currencies, or commodities;

 

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traders in securities that elect to use the mark-to-market method of accounting;

 

•

regulated investment companies and real estate investment trusts;

 

•

pension plans, tax-qualified retirement plans, individual retirement, or other tax-deferred accounts;

 

•

partnerships, S Corporations, or other entities or arrangements classified as partnerships or pass-through entities for U.S. federal income tax purposes (and investors therein);

 

•

tax-exempt organizations, governmental agencies, instrumentalities, or other governmental organizations, and pension funds;

 

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holders that participate in the Rollover and sign the Rollover Agreement (as defined in the Merger Agreement) or otherwise exchange any Class A Common Stock for any equity interests in Parent, or other consideration other than the Merger Consideration;

 

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holders holding the shares as part of a hedging, constructive sale, or conversion, straddle, or other risk reducing transaction;

 

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holders required to accelerate the recognition of any item of gross income as a result of such income being recognized on an applicable financial statement;

 

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holders that received their shares of Class A Common Stock in a compensatory transaction;

 

•

holders that are “controlled foreign corporations” or “passive foreign investment companies,” as those terms are used in the Code;

 

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holders that have held at any time, directly, indirectly, or constructively, more than 5% of our Class A Common Stock;

 

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holders who own an equity interest, actually or constructively, in Parent or the Company continuing as the Surviving Corporation; or

 

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U.S. Holders whose “functional currency” is not the U.S. dollar.

If an entity or arrangement classified as a partnership for U.S. federal income tax purposes is an owner of shares of Class A Common Stock, the tax treatment of a partner in such partnership will generally depend upon the status of the partner and the activities of the partnership. Partnerships holding shares of Class A Common Stock and partners therein should consult their tax advisors regarding the consequences of the Merger.

We have not sought, and do not intend to seek, any ruling from the IRS with respect to the statements made and the conclusions reached in the following summary. No assurance can be given that the IRS will agree with the views expressed in this summary, or that a court will not sustain any challenge by the IRS in the event of litigation.

THIS DISCUSSION IS PROVIDED FOR GENERAL INFORMATION ONLY AND DOES NOT CONSTITUTE LEGAL ADVICE TO ANY HOLDER. A HOLDER SHOULD CONSULT ITS OWN TAX

 

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ADVISORS CONCERNING THE U.S. FEDERAL INCOME TAX CONSEQUENCES RELATING TO THE MERGER IN LIGHT OF ITS PARTICULAR CIRCUMSTANCES AND ANY CONSEQUENCES ARISING UNDER THE LAWS OF ANY STATE, LOCAL, OR FOREIGN TAXING JURISDICTION OR OTHER TAX LAWS.

U.S. Holders

For purposes of this discussion, a “U.S. Holder” is a beneficial owner of shares of Class A Common Stock who or that is for U.S. federal income tax purposes:

 

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an individual who is a citizen or resident of the United States;

 

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a corporation, or other entity taxable as a corporation, created or organized in or under the laws of the United States, any state thereof, or the District of Columbia;

 

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an estate, the income of which is subject to U.S. federal income taxation regardless of its source; or

 

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a trust (a) that is subject to the primary supervision of a court within the United States if one or more United States persons (as defined in section 7701(a)(30) of the Code) have the authority to control all substantial decisions of the trust or (b) that has a valid election in effect under applicable Treasury Regulations to be treated as a United States person for U.S. federal income tax purposes.

The receipt of cash by a U.S. Holder in exchange for shares of Class A Common Stock pursuant to the Merger will be a taxable transaction for U.S. federal income tax purposes. In general, such U.S. Holder’s gain or loss will be equal to the difference, if any, between the amount of cash received pursuant to the Merger (determined before deduction of any applicable withholding taxes) and the U.S. Holder’s adjusted tax basis in the shares surrendered pursuant to the Merger. A U.S. Holder’s adjusted tax basis generally will equal the amount that such U.S. Holder paid for the shares, reduced (but not below zero) by the amount of distributions previously received (if any) that were not treated as dividends for U.S. federal income tax purposes. Such gain or loss generally will be capital gain or loss and will be long-term capital gain or loss if such U.S. Holder’s holding period in such shares is more than one year at the time of the consummation of the Merger. A reduced tax rate on capital gain generally will apply to long-term capital gain of a non-corporate U.S. Holder. There are limitations on the deductibility of capital losses. If a U.S. Holder acquired different blocks of Class A Common Stock at different times and/or for different prices, that U.S. Holder must determine its, his, or her gain or loss, adjusted tax basis, and holding period separately with respect to each block of Class A Common Stock.

Non-U.S. Holders

For purposes of this discussion, the term “Non-U.S. Holder” means a beneficial owner of shares of Class A Common Stock who or that is not a U.S. Holder nor an entity or arrangement treated as a partnership for U.S. federal income tax purposes.

Any gain realized by a Non-U.S. Holder pursuant to the Merger generally will not be subject to U.S. federal income tax unless:

 

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the gain is effectively connected with a trade or business of such Non-U.S. Holder in the United States (and, if required by an applicable income tax treaty, is attributable to a permanent establishment maintained by such Non-U.S. Holder in the United States), in which case such gain generally will be subject to U.S. federal income tax at rates generally applicable to U.S. persons, and, if the Non-U.S. Holder is a corporation, such gain may also be subject to an additional branch profits tax at a rate of 30% (or a lower rate under an applicable tax treaty);

 

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such Non-U.S. Holder is a nonresident alien individual who is present in the United States for 183 days or more in the taxable year of that disposition, and certain other specified conditions are met, in which case such gain (net of certain losses) will be subject to U.S. federal income tax at a rate of 30% (or a lower rate under an applicable tax treaty); or

 

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•

our Class A Common Stock constitutes a United States real property interest (“USRPI”) by reason of the Company being or having been a United States real property holding corporation (“USRPHC”) for U.S. federal income tax purposes, at any time during the shorter of the five-year period ending on the Closing Date or the period that the Non-U.S. Holder held the applicable Class A Common Stock, in which case, subject to the “regularly traded” exception discussed below, such gain generally will be subject to U.S. federal income tax at rates generally applicable to U.S. persons and generally will be subject to a withholding tax equal to 15% of the Merger Consideration received by the Non-U.S. Holder (for which a credit or refund generally may be applied for to the extent such withholding exceeds such Non-U.S. Holder’s actual U.S. federal income tax liability on such holder’s gain realized in the Merger).

With respect to the third bullet point above, the Company believes it currently is not, and has not been at any time during the five-year period ending on the Closing Date, a USRPHC. However, because the determination of whether we are a USRPHC depends on the fair market value of the Company’s real property interests and other business assets, there can be no assurance that the Company currently is not a USRPHC or has not been a USRPHC in the past. Even if the Company were a USRPHC, gain arising from the conversion of a Non-U.S. Holder’s shares of Class A Common Stock into the right to receive cash pursuant to the Merger will not be subject to U.S. federal income tax pursuant to the third bullet point above if our Class A Common Stock is “regularly traded,” as defined by applicable Treasury Regulations, on an established securities market and such Non-U.S. Holder owned, actually and constructively, 5% or less of the Class A Common Stock throughout the Non-U.S. Holder’s entire holding period or, if shorter, the five-year period ending on the Closing Date.

Non-U.S. Holders should consult their tax advisors regarding potentially applicable income tax treaties that may provide for different rules.

Information Reporting and Backup Withholding

Information reporting and backup withholding may apply to the proceeds received by a holder pursuant to the Merger. The current backup withholding rate is 24%. Backup withholding generally will not apply to (a) a U.S. Holder who furnishes a correct taxpayer identification number and certifies that such holder is not subject to backup withholding on IRS Form W-9 or otherwise establishes an exemption, or (b) a Non-U.S. Holder who provides a certification of such holder’s non-U.S. status on the applicable IRS Form W-8 or otherwise establishes an exemption. Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against the holder’s U.S. federal income tax liability, provided that the required information is timely furnished to the IRS. Copies of information returns that are filed with the IRS may be made available to the tax authorities of the country in which a Non-U.S. Holder resides or is established.

Regulatory Approvals Required for the Merger

Under the HSR Act, and the rules promulgated thereunder by the FTC, the Merger cannot be consummated until the Company and Parent each file a notification and report form with the FTC and the Antitrust Division of the Department of Justice under the HSR Act and the applicable waiting period thereunder has expired or been terminated. A transaction notifiable under the HSR Act may not be completed until the expiration of a 30-calendar-day waiting period following the parties’ filing of their respective HSR Act notification forms or the early termination of that waiting period. The Company and Parent and their respective affiliates filed their respective HSR Act notifications on February 6, 2025. The 30-day waiting period with respect to the Merger, which cannot expire on a Saturday, Sunday, or a U.S. federal holiday, is expected to expire at 11:59 p.m. EDT on March 10, 2025, unless the FTC or the DOJ earlier terminates the waiting period, the period is lengthened by a pull-and-refile, or the FTC or the DOJ issues Second Requests.

At any time before or after consummation of the Merger, notwithstanding the expiration or termination of the waiting period under the HSR Act, the Antitrust Division of the DOJ, or the FTC could take such action under

 

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the antitrust laws as it deems necessary or desirable in the public interest, including seeking to enjoin the consummation of the Merger, seeking divestiture of substantial assets of the parties, or requiring the parties to license, or hold separate, assets or terminate existing relationships and contractual rights. At any time before or after the consummation of the Merger, and notwithstanding the expiration or termination of the waiting period under the HSR Act, any state could take such action under the antitrust laws as it deems necessary or desirable in the public interest. Such action could include seeking to enjoin the consummation of the Merger or seeking divestiture of substantial assets of the parties. Private parties may also seek to take legal action under the antitrust laws under certain circumstances.

Parent is subject to the jurisdiction of FERC under Part II of the FPA. Section 203(a)(1) of the FPA provides that no public utility shall sell, lease, or dispose of its jurisdictional facilities or merge or consolidate, either directly or indirectly, such facilities without securing an order from FERC authorizing it to do so. Section 203(a)(2) of the FPA further provides that no holding company in a holding company structure that includes a transmitting utility or an electric utility may purchase, acquire, merge, or consolidate with a transmitting utility, an electric utility company, or a holding company in a holding company structure that includes a transmitting utility or electric utility company without prior FERC authorization. Because all of Altus Power’s subsidiaries’ operational projects are Qualifying Facilities (as defined in the Merger Agreement) exempt from Section 203 of the FPA, Altus Power will not need approval under Section 203(a)(1) of the FPA for the Merger. However, FERC’s approval of the Merger under Section 203(a)(2) of the FPA is required and FERC must authorize the Merger if it finds that the Merger is consistent with the public interest (the “FERC 203 Approval”). The Company and Parent filed an application with FERC on February 20, 2025.

In connection with obtaining any approval or consent related to any applicable law, the Company and Parent have agreed to use their reasonable best efforts to (and shall cause their respective Subsidiaries and Affiliates to) take, or cause to be taken, all appropriate action and do, or cause to be done, all things necessary, proper, or advisable under applicable law, including Antitrust Law, or otherwise to consummate and make effective the Transactions as promptly as practicable.

Delisting and Deregistration of Class A Common Stock

Our Class A Common Stock is currently registered under the Exchange Act and is listed on the NYSE under the symbol “AMPS”. If the Merger is consummated, the Company will cease to be a publicly traded company and will become a wholly owned subsidiary of Parent, and our Class A Common Stock will be delisted from the NYSE and deregistered under the Exchange Act.

 

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PROPOSAL NO. 1: THE MERGER PROPOSAL

The following summary describes certain material provisions of the Merger Agreement. This summary is not complete and is qualified in its entirety by reference to the Merger Agreement, which is attached to this proxy statement as Appendix A and incorporated into this proxy statement by reference. We encourage you to read the Merger Agreement carefully in its entirety because this summary may not contain all the information about the Merger Agreement that is important to you. The rights and obligations of the parties are governed by the express terms and conditions of the Merger Agreement and not by this summary or any other information contained in this proxy statement.

Explanatory Note Regarding the Merger Agreement

The Merger Agreement and this summary of its terms have been included to provide you with information regarding the terms of the Merger Agreement. Factual disclosures about the Company contained in this proxy statement or in the Company’s public reports previously filed with the SEC that are incorporated by reference into this proxy statement may supplement, update, or modify the factual disclosures about the Company contained in the Merger Agreement and described in this summary. The representations, warranties, and covenants made in the Merger Agreement by the Company, Parent, and Merger Sub were made only for purposes of the Merger Agreement and as of specified dates and were qualified and subject to important limitations agreed to by the Company, Parent, and Merger Sub in connection with negotiating the terms of the Merger Agreement. In particular, in your review of the representations and warranties contained in the Merger Agreement and described in this summary, it is important to bear in mind that the representations and warranties were negotiated solely for the benefit of the parties to the Merger Agreement with the principal purpose of contractually allocating risk between the parties to the Merger Agreement, rather than establishing matters as facts. The representations and warranties may also be subject to a contractual standard of materiality different from those generally applicable to stockholders and reports and documents filed with the SEC, and in some cases were qualified by confidential disclosures that were made by each party to the other, which disclosures are not reflected in the Merger Agreement. Moreover, information concerning the subject matter of the representations and warranties, which do not purport to be accurate as of the date of this proxy statement, may have changed since the date of the Merger Agreement, and subsequent developments or new information qualifying a representation or warranty may have been included in this proxy statement or in the respective public filings made by each of the Company or Parent with the SEC. Accordingly, the representations and warranties and provisions of the Merger Agreement should not be read alone, but instead should be read together with the information provided elsewhere in this proxy statement and the documents incorporated by reference into this proxy statement. You should not rely on the representations, warranties, and covenants or any descriptions thereof as characterizations of the actual statement of facts or conditions of the parties thereto or any of their respective subsidiaries or affiliates. You should carefully read and consider the entire Merger Agreement, which is the legal document that governs the Merger, because this summary may not contain all the information about the Merger Agreement that is important to you. The rights and obligations of the parties are governed by the express terms of the Merger Agreement and not by this summary or any other information contained in this proxy statement.

Additional information about the Company may be found elsewhere in this proxy statement and the Company’s other public filings. See the section entitled “Where You Can Find More Information” of this proxy statement.

Closing; When the Merger Becomes Effective

Subject to the terms and conditions of the Merger Agreement, the closing of the Merger will take place at the offices of Latham & Watkins LLP, 811 Main Street, Suite 3700, Houston, TX 77002, at 9:00 a.m. EDT on the date that is five business days after the date on which all of the closing conditions set forth in the Merger Agreement (described under the section entitled “Proposal No. 1: The Merger Proposal—Conditions to the Merger” of this proxy statement) have been satisfied or waived (other than those conditions that by their terms

 

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are to be satisfied immediately prior to or at the Closing, but subject to the satisfaction or waiver of such conditions), unless another time, date, or place is agreed to by the Company and Parent.

Concurrently with, or as promptly as practicable after the Closing, the parties to the Merger Agreement will cause to be filed with the Delaware Secretary of State an appropriate, executed certificate of merger with respect to the Merger in accordance with the DGCL. The Merger will become effective upon the filing of such certificate of merger, or at such later date and time as is agreed by Parent and the Company and specified in such certificate of merger.

Structure of the Merger; Certificate of Incorporation; Bylaws; Directors and Officers

Upon the terms and conditions of the Merger Agreement, at the Effective Time, Merger Sub will merge with and into the Company and the separate corporate existence of Merger Sub will cease, with the Company continuing as the Surviving Corporation. From and after the Effective Time, the Surviving Corporation will possess all properties, rights, privileges, powers, and franchises of the Company and Merger Sub, and all of the debts, liabilities, and duties of the Company and Merger Sub will become the debts, liabilities, and duties of the Surviving Corporation.

At the Effective Time, the Third Amended and Restated Certificate of Incorporation of the Company in effect immediately prior to the Effective Time will be amended and restated in its entirety in the form of the certificate of incorporation of the Merger Sub immediately prior to the Effective Time, and as so amended and restated shall be the certificate of incorporation of the Surviving Corporation until thereafter amended. At the Effective Time, the Bylaws of the Company will be amended and restated in their entirety in the form of the bylaws of Merger Sub immediately prior to the Effective Time, and as so amended and restated shall be the bylaws of the Surviving Corporation until thereafter amended.

From and after the Effective Time, unless otherwise determined by Parent prior to the Effective Time, the officers of the Company immediately before the Effective Time will be the initial officers of the Surviving Corporation and, unless otherwise determined by Parent prior to the Effective Time, the directors of Merger Sub immediately before the Effective Time will be the initial directors of the Surviving Corporation and, in each case, will hold office until their respective successors are duly elected and qualified, or until their earlier death, resignation, or removal, in accordance with the Surviving Corporation’s certificate of incorporation and bylaws.

Effect of the Merger on the Class A Common Stock

At the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub, or the Company, or their respective stockholders, each share of Class A Common Stock issued and outstanding immediately prior to the Effective Time, including shares of Class A Common Stock issued upon conversion of shares of Class B Common Stock (but excluding any Canceled Shares, Dissenting Shares or Rollover Shares) will be automatically canceled and converted into the right to receive the Merger Consideration, without interest and minus any applicable withholding taxes. From and after the Effective Time, all of the shares of Class A Common Stock will no longer be outstanding, will automatically be canceled and retired, and will cease to exist, and each holder of a Certificate and each holder of a Book-Entry Share, in each case, outstanding immediately prior to the Effective Time previously representing any such shares of Class A Common Stock will cease to have any rights with respect thereto, except the right to receive, upon surrender of Certificates or Book-Entry Shares in accordance with the Merger Agreement, the Merger Consideration, without interest.

At the Effective Time, any shares of Class A Common Stock that are Canceled Shares will automatically be canceled and retired without any conversion thereof and will cease to exist, and no consideration or payment will be delivered in exchange for such shares.

Prior to the Effective Time, the Merger Consideration will be equitably adjusted to provide the same economic effect as contemplated in the Merger Agreement to reflect the effect of any reclassification, recapitalization,

 

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stock split (including reverse stock split), or combination, exchange, or readjustment of shares, or any stock dividend or stock distribution with a record date occurring on or after the date of the Merger Agreement and prior to the Effective Time.

Conversion of Class B Common Stock

In connection with the Merger and pursuant to the terms of the Company Certificate, on the business day immediately prior to the Effective Time, each share of Class B Common Stock then issued and outstanding will be automatically converted into shares of Class A Common Stock in accordance with the terms of, and subject to the limitations set forth in, the Company Certificate, and upon such conversion, each such share of Class B Common Stock will automatically be canceled and will cease to exist, and each former holder of Class B Common Stock will thereafter cease to have any rights with respect to such securities.

Treatment of Equity Awards

Company Compensatory Awards. Under the Merger Agreement, except as otherwise agreed upon in writing between the applicable holder and Parent prior to the Effective Time, effective immediately prior to the Effective Time, each Company RSU Award and Company PSU Award will be treated as follows:

 

•

Each Vested Company RSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into the right to receive an amount in cash (without interest) equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Vested Company RSU Award by (b) the Merger Consideration, payable as soon as practicable following the Closing.

 

•

Each Unvested Company RSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into a Post-Closing Cash Award, equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Unvested Company RSU Award by (b) the Merger Consideration, and such Post-Closing Cash Award will vest and become payable pursuant to the same vesting schedule applicable to the Unvested Company RSU Award from which it was converted (including any accelerated vesting terms), subject to the holder’s continued employment with Parent and its subsidiaries (including the Surviving Corporation) through the applicable vesting date.

 

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Each Company TSR PSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into a Post-Closing Cash Award, if any, equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Company TSR PSU Award (with the Merger Consideration used to determine the Company’s percentile rank relative to the applicable peer groups and such performance-based goals deemed to be achieved based on such relative percentile rank as of the date of the Merger Agreement) by (b) the Merger Consideration, and such Post-Closing Cash Award will vest and become payable pursuant to the same time-vesting schedule applicable to the Company TSR PSU Award from which it was converted (including any accelerated vesting terms), subject to the holder’s continued employment with Parent and its subsidiaries (including the Surviving Corporation) through the applicable vesting date.

 

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Each Company GW PSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time and converted into a Post-Closing Cash Award, if any, equal to the product obtained by multiplying (a) the aggregate number of shares of Class A Common Stock underlying such Company GW PSU Award (with any per share stock price performance-based goals deemed to be achieved based on the Merger Consideration) by (b) the Merger Consideration, and such Post-Closing Cash Award will vest and become payable

 

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pursuant to the same time-vesting schedule and based on the achievement of the same installed solar capacity goals applicable to the Company GW PSU Award from which it was converted (including any accelerated vesting terms), subject to the holder’s continued employment with Parent and its subsidiaries (including the Surviving Corporation) through the applicable vesting date.

 

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Each Company Stock Price PSU Award that remains outstanding immediately prior to the Effective Time will automatically be canceled and terminated as of immediately prior to the Effective Time for no consideration.

Payments. At or prior to the Effective Time, Parent will deposit, or cause to be deposited, with the Company, cash in an amount sufficient to pay the aggregate Merger Consideration payable to all of the holders of vested Company RSU Awards (solely with respect to such awards that are vested as of Closing), which will be payable through the Company’s payroll system. Parent will cause the Post-Closing Cash Awards to be paid through the Company’s payroll system as soon as practicable following the date on which such payment becomes due. All amounts payable with respect to the Company RSU Awards and Company PSU Awards will be subject to deduction for any required tax withholding.

Company Stock Plan and ESPP. Pursuant to the terms of the Merger Agreement, subject to the consummation of the Merger, the 2021 Plan will terminate effective as of immediately prior to the Effective Time.

Following the date of the Merger Agreement, no new participants have been (or will be) allowed to participate in the ESPP. Subject to the consummation of the Merger, the ESPP will terminate effective as of immediately prior to the Effective Time.

Payment for the Class A Common Stock

At or prior to the Effective Time, Parent will deposit, or cause to be deposited, with the Paying Agent, cash in an amount sufficient to pay the aggregate Merger Consideration payable to all of the holders of Class A Common Stock, other than the Canceled Shares and except for any Dissenting Shares.

As soon as reasonably practicable after the Effective Time and in any event within two business days following the Effective Time, Parent will cause the Paying Agent to send to each holder of record of Certificates or Book-Entry Share that immediately prior to the Effective Time represented outstanding shares of Class A Common Stock (other than the Canceled Shares and except for any Dissenting Shares) (a) a letter of transmittal, which will specify that delivery will be effected, and risk of loss and title will pass, only upon proper delivery of the Certificates (or effective affidavits of loss in lieu thereof) or Book-Entry Shares, as applicable, to the Paying Agent, for use in effecting delivery of the Class A Common Stock to the Paying Agent, and (b) instructions for use in effecting the surrender of such Certificates (or effective affidavits of loss in lieu thereof) or Book-Entry Shares, as applicable, in exchange for the Merger Consideration in such form as Parent and the Company may reasonably agree.

Representations and Warranties

The Merger Agreement contains representations and warranties of each of the Company, Parent, and Merger Sub, subject to certain qualifications or exceptions in the Merger Agreement and the applicable disclosure letter delivered in connection with the Merger Agreement, as to, among other things:

 

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corporate organization, existence, good standing, and corporate power and authority;

 

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corporate power and authority to enter into the Merger Agreement and the Company Support Agreements and to perform their obligations thereunder;

 

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required regulatory filings or actions and authorizations, consents, or approvals of any governmental authority;

 

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•

the absence of certain violations, defaults, or consent requirements under certain contracts, organizational documents, and laws, in each case arising out of the execution, delivery, or performance of, consummation of the transactions contemplated by, or compliance with any of the provisions of, the Merger Agreement;

 

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the absence of proceedings related to Parent and its subsidiaries or the Company and its subsidiaries (as applicable);

 

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matters relating to information to be included in required filings with the SEC in connection with the Merger, including this proxy statement; and

 

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the absence of any fees owed to investment bankers or brokers in connection with the Merger, other than those specified in the Merger Agreement.

The Merger Agreement also contains representations and warranties of the Company, subject to certain qualifications or exceptions in the Merger Agreement and the “Company Disclosure Letter” (as defined in the Merger Agreement) delivered in connection with the Merger Agreement, as to, among other things:

 

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the capitalization and authorized issuance of the Company’s equity securities, including the authorized capital stock and outstanding restricted stock unit awards and performance stock unit awards;

 

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the organization and capitalization of the Company’s subsidiaries;

 

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the timeliness and accuracy of the Company’s filings with the SEC and of financial statements included in its SEC filings;

 

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the Company’s disclosure controls and procedures and internal control over financial reporting and compliance with the Sarbanes-Oxley Act;

 

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the absence of certain events or changes in the business of the Company between December 31, 2023 and February 5, 2025, including that there has not been a Company Material Adverse Effect;

 

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the absence of undisclosed liabilities;

 

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certain categories of specified material contracts, including as to effectiveness and absence of breach or default for such contracts and the absence of any material claims or disputes pending or threatened under such material contracts;

 

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the compliance by the Company and its subsidiaries with applicable law and their respective permits, approvals, licenses, and other authorizations, including franchises and ordinances issued or granted by a governmental authority;

 

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certain property owned or leased by the Company and its subsidiaries;

 

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the ownership of or rights with respect to, and lack of infringement with respect to, intellectual property owned or used by the Company and its subsidiaries and data privacy matters;

 

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insurance policies of the Company or any of its subsidiaries;

 

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the payment of taxes, the filing of tax returns, lack of tax audits or proceedings, and other tax matters related to the Company and its subsidiaries;

 

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the Company’s employee benefit plans and other agreements with its employees and other service providers and labor matters;

 

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environmental matters and compliance with environmental laws by the Company and its subsidiaries;

 

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energy regulatory matters;

 

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the compliance by Company and its subsidiaries with all US customs and import laws;

 

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the required stockholder approval in order to effect the Merger;

 

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•

the inapplicability of takeover statutes to the Company, the Merger Agreement, the Company Support Agreements, the Rollover Agreement, or the Transactions;

 

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tax credits;

 

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receipt of the Moelis fairness opinion;

 

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absence of requirement by the Company or its subsidiaries to be registered as an investment company; and

 

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the absence of any other representations and warranties.

The Merger Agreement also contains representations and warranties of Parent and Merger Sub, subject to certain qualifications or exceptions in the Merger Agreement and the “Parent Disclosure Letter” (as defined in the Merger Agreement) delivered in connection with the Merger Agreement, as to, among other things:

 

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the absence of ownership by Parent and Merger Sub and their respective subsidiaries of any capital stock of the Company;

 

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the financing commitments received by Parent, and the sufficiency of the funds committed to be provided therein;

 

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the Limited Guaranty delivered to the Company (including the enforceability thereof);

 

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the solvency of Parent and the Company following the consummation of the Merger;

 

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the ownership by Parent of all of the issued and outstanding capital stock of Merger Sub and the absence of any prior obligations or liabilities of Merger Sub;

 

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the absence of arrangements between Parent and Merger Sub and the Company’s directors, officers, and affiliates;

 

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the absence of agreements between Parent, Merger Sub, and their respective Affiliates and third parties that would be reasonably expected to limit Parent’s or Merger Sub’s ability to comply with the Merger Agreement or materially delay or prevent consummation of the Transactions; and

 

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the absence of any other representations and warranties.

Some of the representations and warranties in the Merger Agreement are qualified by materiality qualifications or a Company Material Adverse Effect.

For purposes of the Merger Agreement, a “Company Material Adverse Effect” means any change, effect, event, occurrence, state of facts, or development (an “Effect”), individually or in the aggregate, that:

 

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has prevented or materially impaired, materially interfered with, or materially delayed, or would reasonably be expected to prevent or materially impair, materially interfere with, or materially delay, the ability of the Company to consummate the Transactions; or

 

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has or would reasonably be expected to have a material adverse effect on the results of operations or financial condition of the Company and its subsidiaries, taken as a whole,

 

•

provided, however, that, for the purposes of the foregoing clause, in no event would any of the following, alone or in combination, be deemed to constitute, nor shall any of the following (including any Effect resulting from any of the following) be taken into account in determining whether there has been or will be, a “Company Material Adverse Effect”:

 

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any change in applicable law, GAAP, or any authoritative interpretation thereof (except to the extent that such Effect has a disproportionate adverse impact on the Company and its subsidiaries (taken as a whole) relative to other businesses in the industries in which the Company and its subsidiaries operate, in which case only the incremental disproportionate adverse impact may be taken into account in determining whether a Company Material Adverse Effect has occurred);

 

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•

general economic or business conditions in the United States or any other country or region in the world or changes therein or changes in conditions in the global economy generally (except to the extent that such Effect has a disproportionate adverse impact on the Company and its subsidiaries (taken as a whole) relative to other businesses in the industries in which the Company and its subsidiaries operate, in which case only the incremental disproportionate adverse impact may be taken into account in determining whether a Company Material Adverse Effect has occurred);

 

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general financial, credit, and capital markets conditions in the United States or any other country or region in the world, including interest rates, credit ratings, inflation, and currency exchange rates, and any changes therein (except to the extent that such Effect has a disproportionate adverse impact on the Company and its subsidiaries (taken as a whole) relative to other businesses in the industries in which the Company and its subsidiaries operate, in which case only the incremental disproportionate adverse impact may be taken into account in determining whether a Company Material Adverse Effect has occurred);

 

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volcanoes, tsunamis, earthquakes, hurricanes, mudslides, wildfires, or other natural disasters, pandemics, epidemics, or other disease outbreaks or any response of any governmental authority (including any requirements for business closures or “sheltering-in-place”) related to any of the foregoing, weather conditions, or any other acts of God or other force majeure events, or the escalation, worsening, or other changes thereof (except to the extent that such Effect has a disproportionate adverse impact on the Company and its subsidiaries (taken as a whole) relative to other businesses in the industries in which the Company and its subsidiaries operate, in which case only the incremental disproportionate adverse impact may be taken into account in determining whether a Company Material Adverse Effect has occurred);

 

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regulatory, legislative, or political conditions in the United States or any other country or region in the world, acts of terrorism, the commencement, continuation, or escalation of war, armed hostilities (whether or not declared), or national or international calamity, or any escalation, worsening, or other changes thereof (except to the extent that such Effect has a disproportionate adverse impact on the Company and its subsidiaries (taken as a whole) relative to other businesses in the industries in which the Company and its subsidiaries operate, in which case only the incremental disproportionate adverse impact may be taken into account in determining whether a Company Material Adverse Effect has occurred);

 

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seasonal fluctuations in the business of the Company and its subsidiaries not attributable to any change in the manner of operation of the business of the Company and its subsidiaries;

 

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general economic or business changes affecting the industries in which the Company and its subsidiaries operate (except to the extent that such Effect has a disproportionate adverse impact on the Company and its subsidiaries (taken as a whole) relative to other businesses in the industries in which the Company and its subsidiaries operate, in which case only the incremental disproportionate adverse impact may be taken into account in determining whether a Company Material Adverse Effect has occurred);

 

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the negotiation, entry into, or announcement of the Merger Agreement or the pendency or consummation of the Transactions (including (1) the initiation of litigation by any Person with respect to the Merger Agreement or the Transactions, (2) any termination of, reduction in, or similar negative impact on relationships, contractual or otherwise, with any customers, suppliers, distributors, partners, or employees of the Company and its subsidiaries, or (3) any loss or diminution of rights or privileges, or any creation of, increase in, or acceleration of obligations, pursuant to Contract or otherwise, on the part of Company and its subsidiaries, in each case due to the negotiation, entry into, or announcement of the Merger Agreement or the pendency or consummation of the Transactions) (it being understood that this clause shall not apply to, and shall be disregarded with respect to, references to “Company Material Adverse Effect” in any representations and warranties made by the Company that are intended to address the

 

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consequences of the negotiation, execution, or announcement of the Merger Agreement or the pendency or consummation of the Transactions or with respect to any condition to Closing to the extent such condition relates to any such representation or warranty);

 

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the Company’s taking of any action (or its omission of any action) expressly required or permitted by the Merger Agreement or requested by Parent;

 

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any change in the price or trading volume of the Company’s securities or other financial instruments, in and of itself (it being understood that this clause shall not prevent a determination that any Effect underlying such change has resulted in a Company Material Adverse Effect (to the extent such Effect is not otherwise excluded from this definition of Company Material Adverse Effect)); or

 

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any failure of the Company and its subsidiaries to meet any internal or published projections, estimates, or forecasts (it being understood that this clause shall not prevent a determination that any Effect underlying such failure to meet projections, estimates, or forecasts has resulted in a Company Material Adverse Effect (to the extent such Effect is not otherwise excluded from this definition of Company Material Adverse Effect)).

Other Covenants and Agreements

Access and Information

Subject to certain exceptions and limitations, until the Effective Time, the Company will, and will cause its subsidiaries to, (upon reasonable notice and at Parent’s sole cost and expense) afford Parent, Merger Sub, and their respective representatives reasonable access, during normal business hours, in such a manner as to not interfere with the operation of the business of the Company and its subsidiaries, to the properties, books, contracts, commitments, tax returns, records, and appropriate officers and employees of the Company and its subsidiaries and will furnish such representatives of Parent and Merger Sub with existing financial and operating data and other information concerning the affairs of the Company and its subsidiaries as such representatives of Parent may reasonably request.

Minimum Cash Maintenance

Until the Effective Time, the Company will, and will cause its subsidiaries to, maintain a specified level of aggregate amount of cash and cash equivalents.

No-Shop; Acquisition Proposals

From and after the date of the Merger Agreement until the earlier of the Effective Time or the date, if any, on which the Merger Agreement is validly terminated in accordance with its terms, except as expressly permitted pursuant to the Merger Agreement, the Company will (and will cause its subsidiaries and will use commercially reasonable efforts to cause its and their representatives to) (a) cease and cause to be terminated any existing solicitation, encouragement, discussion, or negotiation with any third party with respect to an Acquisition Proposal, and promptly request the prompt return or destruction of any non-public information concerning the Company and any of its subsidiaries that was previously furnished in connection therewith and immediately terminate all physical and electronic data room access previously granted to any such third party and (b) take the necessary steps to promptly inform any third parties with whom discussions and negotiations were occurring or who make an Acquisition Proposal after the date of the Merger Agreement of the no-shop obligations of the Company.

In addition, from and after the date of the Merger Agreement until the earlier of the Effective Time or the date, if any, on which the Merger Agreement is validly terminated in accordance with its terms, except as expressly

 

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permitted pursuant to the Merger Agreement, the Company will not (and will cause its subsidiaries and will use commercially reasonable efforts to cause its and their representatives not to):

 

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solicit, initiate, seek, or knowingly facilitate or encourage any inquiry, discussion, offer, or request that constitutes, or would reasonably be expected to lead to, an Acquisition Proposal;

 

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enter into, continue, or otherwise participate in any negotiations or discussions with, or furnish any non-public information relating to the Company and its subsidiaries to, or afford access to the books or records, properties, assets, facilities, or officers, employees, or other personnel of the Company and its subsidiaries to, or provide any physical or electronic data room access to, any third party with respect to an Acquisition Proposal or any inquiry, proposal, or offer that would reasonably be expected to lead to an Acquisition Proposal; provided that, the Company is permitted to grant a waiver of or terminate any “standstill” or similar agreement or obligation of any third party with respect to the Company and its subsidiaries to allow such third party to submit an Acquisition Proposal if (a) the Board determines in good faith, after consultation with its outside legal advisors, that the failure to take such action would violate the directors’ fiduciary duties under applicable law and (b) any such waiver is limited to the extent necessary to permit a third party to make an Acquisition Proposal, on a confidential basis, to the Board and communicate such waiver to the applicable third party (provided, however, that the Company is required to advise Parent at least two business days prior to taking such action);

 

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approve, endorse, recommend, or enter into (or publicly propose to approve, endorse, recommend, or enter into) any letter of intent, memorandum of understanding, agreement in principle, acquisition agreement, merger agreement, or other definitive agreement with respect to any Acquisition Proposal, other than an Acceptable Confidentiality Agreement (as defined in the Merger Agreement); or

 

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submit any Acquisition Proposal to the vote of the Company’s stockholders.

Notwithstanding the limitations in the preceding paragraph, if the Company receives, at any time following the date of the Merger Agreement and prior to obtaining the Required Company Stockholder Approval, a bona fide written Acquisition Proposal from a third party that was not solicited at any time following the execution of the Merger Agreement and that did not result from a breach of the no-shop and related provisions of the Merger Agreement and the Board determines in good faith, after consultation with its independent financial advisor and outside legal counsel, that (a) such Acquisition Proposal constitutes, or would reasonably be expected to lead to, a Superior Proposal, and (b) the failure to take the action described immediately below would violate the Board’s fiduciary duties to the Company’s stockholders under applicable law, then the Company and its representatives may (i) furnish non-public information and afford access to the books, records properties, assets, facilities, and officers, employees, and other personnel of the Company and its subsidiaries to such third party and its representatives pursuant to an Acceptable Confidentiality Agreement, (ii) engage in discussions and negotiations with such third party and its affiliates and representatives with respect to the Acquisition Proposal, and (iii) otherwise facilitate such Acquisition Proposal or assist such third party (and its affiliates, representatives, prospective debt and equity financing sources, or their respective representatives) with such Acquisition Proposal, in each case, if requested by such third party. Any material non-public information provided to any third party making an Acquisition Proposal or its representatives must also be provided to Parent as promptly as reasonably practicable after such information is made available to such third party. In any event, the Company is permitted to contact any third party making an Acquisition Proposal to the extent necessary to clarify the terms of such inquiry or proposal solely to determine whether such inquiry or proposal constitutes, or would reasonably be expected to lead to, a Superior Proposal and inform such third party that has made or, to the knowledge of the Company, is considering making an Acquisition Proposal of the no-shop and related provisions of the Merger Agreement.

Except as expressly permitted by the Merger Agreement in respect of a Superior Proposal, neither the Board nor any committee thereof may take any action described immediately below (any such action, an “Adverse Recommendation Change”):

 

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withdraw, modify, or propose publicly to withdraw or modify, in a manner adverse to Parent, its recommendation in favor of adoption of the Merger Agreement;

 

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•

fail to include the Board’s recommendation in favor of adoption of the Merger Agreement in this proxy statement; or

 

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approve or recommend, or publicly propose to approve or recommend, any Acquisition Proposal made or received after the date of the Merger Agreement.

The Board has also agreed not to cause or permit the Company to enter into any letter of intent, memorandum of understanding, agreement in principle, acquisition agreement, merger agreement, or other definitive agreement with respect to any Acquisition Proposal, other than an Acceptable Confidentiality Agreement (an “Alternative Acquisition Agreement”).

Before obtaining the Required Company Stockholder Approval and after first complying with the no-shop and related provisions of the Merger Agreement described in this proxy statement, the Board, in response to a bona fide Acquisition Proposal received by the Company or the Board that did not arise from a breach of the no-shop and related provisions of the Merger Agreement (other than any breach that is both immaterial and unintentional), may:

 

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effect an Adverse Recommendation Change; or

 

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authorize the Company to terminate the Merger Agreement and substantially concurrently with such termination enter into a definitive agreement providing for such Superior Proposal;

provided, however, that the Board is not permitted to take the actions described in the two bullet points immediately above unless, among other things, (a) the Board determines in good faith, after consultation with its independent financial advisor and outside legal counsel, that failure to effect an Adverse Recommendation Change or terminate the Merger Agreement in accordance with the second bullet point above would violate its fiduciary duties pursuant to applicable law; (b) at least four business days have elapsed after the Company provided Parent with written notice that it intended to effect an Adverse Recommendation Change and terminate the Merger Agreement, which such written notice includes, among other things, written notice of the material terms of the Acquisition Proposal and an unredacted copy of the Alternative Acquisition Agreement in respect of such Acquisition Proposal; (c) in such four-business day period, the Company and its representatives have used commercially reasonable efforts to negotiate with Parent in good faith (to the extent Parent so desires to negotiate) any proposed modifications to the terms and conditions of the Merger Agreement, the Equity Commitment Letter, the Limited Guaranty provided by the TPG Guarantor, and the debt commitment letter so that such Acquisition Proposal ceases to constitute a Superior Proposal; and (d) following the end of such four business day period described in the preceding clause (c), the Board determines in good faith, after consultation with its independent financial advisor and outside legal counsel, taking into account any changes to the Merger Agreement and the other transaction documents offered in writing by Parent in response to the notice described in clause (b) above, that the Superior Proposal giving rise to the notice of Adverse Recommendation Change continues to constitute a Superior Proposal. In the event of any material amendment of such Superior Proposal, the Board (or any committee thereof) shall be required to issue a new written notice that it intends to effect an Adverse Recommendation Change and again comply with the procedures described in clauses (c) and (d) of this paragraph; provided, however, that for purposes of this sentence, references to the four-business day period above shall be deemed to be references to a two-business day period from the time of Parent’s receipt of the new notice.

For purposes of the Merger Agreement, “Acquisition Proposal” means:

 

•

other than the Transactions or any other proposal or offer from Parent or any of its Subsidiaries, any proposal or offer from a third party relating to (a) any acquisition or purchase, in a single transaction or series of related transactions, of (i) the assets of the Acquired Companies constituting 15% or more of the assets of the Acquired Companies, taken as a whole (based on the fair market value thereof), or to which 15% or more of the Acquired Companies’ net revenues or earnings on a consolidated basis are attributable, or (ii) 15% or more of the combined voting power of the Company; (b) any tender offer or

 

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exchange offer that if consummated would result in any Person or “group” (as defined in the Exchange Act) acquiring beneficial ownership of 15% or more of the combined voting power of the Company; or (c) any merger, consolidation, business combination, recapitalization, liquidation, dissolution, share exchange, or other transaction involving the Company or any of its Subsidiaries in which a third party, a “group” (as defined in the Exchange Act), or their respective stockholders, if consummated, would acquire 15% or more of the combined voting power of the Company or the surviving entity or the resulting direct or indirect parent of the Company or such surviving entity.

For purposes of the Merger Agreement, “Required Company Stockholder Approval” means:

 

•

the affirmative vote of the holders of at least a majority of the outstanding shares of Class A Common Stock entitled to vote in accordance with the DGCL to adopt the Merger Agreement at the Company’s stockholders’ meeting.

For purposes of the Merger Agreement, “Superior Proposal” means:

 

•

a bona fide written Acquisition Proposal (except the references therein to “15% or more” shall be replaced by “all or substantially all”) made by a third party that the Board determines in good faith, after consultation with its independent financial advisor and outside legal counsel, (a) is, if accepted, reasonably likely to be consummated on the terms proposed (or, alternatively, at least as likely as the Merger to be consummated), taking into account any legal, financial, regulatory, and stockholder approval requirements, the sources, availability, and terms of any financing, financing market conditions, and the existence of a financing contingency, breakup, or termination fee or expense reimbursement provisions, the likelihood of termination, the timing of closing, the identity of the third party making the proposal, and any other aspects or factors considered relevant by the Board, and (b) taking into account such factors as the Board acting in a manner consistent with its fiduciary duties under applicable law considers to be appropriate, would result in a transaction that is more favorable from a financial point of view to the Company’s stockholders than the Transactions (if applicable, after taking into account any adjustments or revisions to the terms of the Merger Agreement offered by Parent in response to such proposal).

From the date of the Merger Agreement until the Effective Time or the date, if any, on which the Merger Agreement is validly terminated in accordance with its terms, the Company will (a) provide Parent as promptly as practicable (and in any event within 24 hours) written notice of the receipt by the Company or any of its representatives of any Acquisition Proposal from any third party or any request for non-public information or inquiry that could reasonably be expected to lead to an Acquisition Proposal from any third party, and a copy of such Acquisition Proposal, request, or inquiry (or if such Acquisition Proposal, request, or inquiry is not made in writing, a written summary of the material terms and conditions of such Acquisition Proposal, request, or inquiry), and (b) promptly (and in any event within 24 hours) provide Parent such information as is reasonably necessary to keep Parent reasonably informed in all material respects, on a reasonably current basis, of oral or written communications regarding, and the status and material details (including material amendments or proposed material amendments) of, any such Acquisition Proposal, request, or inquiry and provide Parent with a copy of any such written proposal or offer.

The Merger Agreement provides that nothing therein will prohibit the Company or the Board (or any committee thereof), directly or indirectly through its representatives, from (a) taking and disclosing to the Company’s stockholders a position with respect to a tender or exchange offer by a third party pursuant to Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act (or any similar communication to its stockholders), (b) making any “stop, look, and listen” communication to its stockholders pursuant to Rule 14d-9(f) promulgated under the Exchange Act or a factually accurate public statement that describes the Company’s receipt of an Acquisition Proposal and the operation of the Merger Agreement with respect thereto, or (c) complying with Item 1012(a) of Regulation M-A promulgated under the Exchange Act, other than an Adverse Recommendation Change (unless such Adverse Recommendation Change is made in accordance with the Company’s no-shop obligations under

 

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the Merger Agreement) if the Board has determined in good faith, after consultation with its financial and outside legal advisors, that the failure to do so would be inconsistent with the Board’s fiduciary duties to the Company’s stockholders under applicable law.

Special Meeting and Related Actions

Pursuant to the Merger Agreement and in accordance with the Company’s organizational documents, applicable law, and the rules of the NYSE, the Company is required to use reasonable best efforts to, as promptly as reasonably practicable following the execution of the Merger Agreement, establish a record date for, duly call, give notice of, convene, and hold a Special Meeting of the stockholders of the Company for the purpose of seeking the Required Company Stockholder Approval. Unless there has been an Adverse Recommendation Change in compliance with the terms of the Merger Agreement, the Company will use its reasonable best efforts to solicit from its stockholders proxies in favor of the adoption of the Merger Agreement. Unless the Merger Agreement has been terminated pursuant to its terms, the Company will submit the Merger Agreement to its stockholders for adoption at such meeting, whether or not the Board at any time after the date of the Merger Agreement has effected an Adverse Recommendation Change.

Employee Matters

For a period of 12 months following the Effective Time (or until the employment of a continuing employee terminates, if earlier), Parent and the Surviving Corporation will provide each continuing employee with (a) an annual base salary or hourly wage rate (as applicable) at least equal to the annual base salary or hourly wage rate (as applicable) provided to such continuing employee immediately prior to the Effective Time, (b) annual cash bonus or other short-term cash incentive opportunities that are no less favorable than the annual cash bonus or other short-term cash incentive opportunities (excluding equity and equity-based compensation opportunities) provided to such continuing employee immediately prior to the Effective Time, (c) severance benefits and protections that are no less favorable than those provided to the continuing employee immediately prior to the Effective Time (if any), taking into account such continuing employee’s period of service and increases in compensation following the Closing, and (d) employee and fringe benefits (including vacation/leave, health, welfare, and retirement benefits, but excluding any equity or equity-based compensation, severance, cash incentive opportunities, retention benefits, transaction benefits, bonuses, change in control benefits, nonqualified deferred compensation, defined benefit pension compensation, and post-employment welfare benefits) that are at least as favorable, in the aggregate, to those provided to the continuing employee immediately prior to the Effective Time. For any continuing employees who have historically received an annual equity award as a portion of their overall compensation, Parent will take into account any such historical equity awards issued to such continuing employee and disclosed to Parent prior to the date of the Merger Agreement when evaluating the compensation and benefits offered by Parent and the Surviving Corporation. The covenants of this paragraph also apply with respect to the compensation and benefits (including severance) set forth in the offer letter for each individual who has signed an employment offer letter with the Company or any of its subsidiaries but who has not commenced employment as of the Effective Time.

As of the Effective Time and thereafter, Parent will recognize, or will cause the Surviving Corporation to recognize, each continuing employee’s years of employment or service with the Company or any of its subsidiaries prior to the Closing for purposes of determining, as applicable, eligibility for participation, vesting, entitlement of any continuing employee, and future vacation accruals under analogous employee benefit plans maintained by Parent, the Surviving Corporation, or the Surviving Corporation’s affiliates in which such continuing employees become participants (including vacation plans or arrangements, 401(k), or other retirement plans and any severance or welfare plans, but not for vesting of future equity awards or accrual or entitlement to any pension benefits or post-employment welfare benefits, or to the extent such recognition would result in a duplication of benefits).

Effective as of the Effective Time and thereafter, Parent will, or will cause the Surviving Corporation to use commercially reasonable efforts to (a) cause any pre-existing conditions or limitations, eligibility waiting

 

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periods, actively at work requirements, evidence of insurability requirements, or required physical examinations under any corresponding health or similar plan of Parent, the Surviving Corporation, or any of the Surviving Corporation’s affiliates to be waived with respect to continuing employees and their eligible dependents, except to the extent that any waiting period, exclusions, or requirements still applied to such continuing employee under the corresponding plan in which such continuing employee participated immediately before the Effective Time, and (b) fully credit each continuing employee with all deductible payments, co-payments, and other out-of-pocket expenses incurred by such continuing employee and his or her covered dependents under the corresponding group medical, dental, pharmaceutical, and vision benefit plans of the Company and its subsidiaries prior to the Closing during the plan year in which the Closing occurs for the purpose of determining the extent to which such continuing employee has satisfied the corresponding deductible, co-payments, or maximum out-of-pocket requirements applicable to such continuing employee and his or her covered dependents for such plan year under any comparable medical, dental, pharmaceutical, or vision benefit plan of Parent, the Surviving Corporation, or any of the Surviving Corporation’s affiliates, as if such amounts had been paid in accordance with such plan.

The Merger Agreement also provides that in the event the Closing occurs prior to the payment of bonuses under the Company’s 2024 annual bonus program, Parent will cause each continuing employee to be paid such continuing employee’s 2024 annual bonus pursuant to the terms and conditions set forth in such program consistent with the Company’s past practice. The annual bonuses will be paid no later than April 10, 2025, subject to the continuing employee’s continued employment through the payment date, except that a continuing employee will remain entitled to receive such employee’s 2024 annual bonus if the continuing employee dies or incurs a termination of employment without “cause” or due to the employee’s “disability” (each such term, as defined in the 2021 Plan), in any case, prior to the payment date.

Efforts to Consummate the Merger

The Company, Parent, and Merger Sub will each use its reasonable best efforts to (and will cause their respective subsidiaries and affiliates to): (a) take all appropriate action and do all things necessary, proper, or advisable under applicable law (including antitrust and foreign investment law) or otherwise to consummate the Transactions as promptly as practicable; (b) obtain from any governmental authority any consents, licenses, permits, waivers, approvals, authorizations, or orders required to be obtained by the Company, Parent, or Merger Sub or any of their respective subsidiaries or affiliates, or to avoid any action or proceeding by any governmental authority (including those in connection with the antitrust and foreign investment laws), in connection with the authorization, execution, and delivery of the Merger Agreement and the consummation of the Transactions; (c) as promptly as reasonably practicable after the date of the Merger Agreement (and in any event within 10 business days following the date of the Merger Agreement), make all necessary filings, and thereafter make any other required submissions, with respect to the Merger Agreement required under the HSR Act; (d) as promptly as reasonably practicable, and in any event using reasonable best efforts to do so within specified time periods, make all necessary filings, and thereafter make any other required submissions, with respect to the Merger Agreement required under any other applicable antitrust and foreign investment laws; (e) as promptly as reasonably practicable after the date of the Merger Agreement, make all necessary filings, and thereafter make any other required submissions, with respect to the Merger Agreement required under any other applicable law; and (f) deliver required notices to, and the obtaining of required consents or waivers from, third parties (provided that the Company will not be obligated to make any payment or commercial concession to any third party, or incur any liability, as a condition to (or in connection with) obtaining any such consent or waiver, unless such payment, concession, or liability is requested in writing by Parent and is conditioned and effective only upon the Closing). The Company and Parent will furnish to each other all information required for any application or other filing under the rules and regulations of any applicable law in connection with the Transactions.

The Company, Parent, and Merger Sub will (and will cause their respective subsidiaries and affiliates to): (a) give the other parties prompt notice of the making or commencement of any request, inquiry, investigation, action, or legal proceeding by or before any governmental authority with respect to the Merger or any of the

 

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other Transactions; (b) keep the other parties reasonably informed as to the status of the foregoing; (c) promptly inform the other parties of any substantive communications to or from any governmental authority regarding approval of the Merger or any of the other Transactions; (d) respond as promptly as practicable to additional requests for information received by any party from any antitrust and foreign investment authorities any other governmental authority with respect to the Transactions or filings contemplated in the Merger Agreement; and (e) use reasonable best efforts to obtain the expiration or termination of all waiting periods under the HSR Act and such other approvals, consents, and clearances under any applicable law (including any other applicable antitrust and foreign investment laws) necessary to consummate the Transactions. In addition, except as may be prohibited by any governmental authority or applicable law, in connection with any such request, inquiry, investigation, action, or legal proceeding, the Company, Parent, and Merger Sub will permit the representatives of the other parties to be present at each meeting or conference relating to such request, inquiry, investigation, action, or legal proceeding and to have access to and be consulted in connection with any document, opinion, or proposal made or submitted to any governmental authority in connection with such request, inquiry, investigation, action, or legal proceeding. Parent will (and will cause its subsidiaries and affiliates to) consult with the Company before agreeing to (1) “pull and refile” any filing made under the HSR Act or (2) offer, negotiate, or enter into any commitment or agreement, including any timing agreement, with any governmental authority to delay the consummation of, or not to close before a certain date, any of the Transactions.

Parent and the Company will (and will cause their respective subsidiaries and affiliates to) cooperate in good faith with governmental authorities and use their respective reasonable best efforts to undertake promptly (a) any and all action to complete lawfully the Transactions as soon as practicable (but in any event prior to the End Date) and (b) any and all action necessary or advisable to avoid, prevent, eliminate, or remove the actual or threatened commencement of any legal proceeding in any forum or the issuance of any governmental order that would (or to obtain the agreement or consent of any governmental authority to the Transactions the absence of which would) delay, enjoin, prevent, restrain, or otherwise prohibit the consummation of the Merger. However, neither Parent, Merger Sub, nor any of their affiliates, or any portfolio company of any investment fund affiliated with or managed by TPG Inc. be obligated to offer, propose, negotiate, agree to, consent to, and effect: (i) the sale, divestiture, license, or other disposition or transfer of any assets, businesses, or interests; (ii) the termination, amendment, or assignment of any commercial relationships, ventures, other arrangements, contractual rights, or obligations; (iii) the grant of any right or commercial or other accommodation, or other contractual or other commercial relationship, to any third; (iv) limitations or restrictions on Parent or any of its subsidiaries or affiliates with respect to the ownership, conduct or operation of any assets, businesses or interests; (v) any other change or restructuring of Parent or any of its subsidiaries or affiliates, or the Company and its subsidiaries; or (vi) any other remedy, condition, commitment, or undertaking of any kind.

Conduct of Business Pending the Merger

The Merger Agreement provides that, subject to certain exceptions in the Company Disclosure Letter, and except as may be expressly contemplated by the Merger Agreement, required by law or as consented to by Parent in writing (such consent not to be unreasonably withheld, conditioned, or delayed for certain of the actions described below), during the period from the date of the Merger Agreement to the Effective Time (or the date, if any, on which the Merger Agreement is terminated by its terms), (a) the Company will, and will cause each of its subsidiaries to, conduct its operations, in all material respects, in the ordinary course of business and use commercially reasonable efforts to preserve its goodwill and current relationships with customers, suppliers, and other persons having material business relations with the Company and its subsidiaries, and (b) the Company will not, and will cause each of its subsidiaries not to:

 

•

amend the certificate of incorporation or bylaws of the Company or amend the certificate of incorporation, bylaws, or other organizational documents of any subsidiary of the Company in any material respect or in any manner that would prevent or materially delay consummation of the Transactions;

 

•

issue, sell, grant options or rights to purchase, or receive, pledge, or authorize or propose the issuance, sale, grant of options or rights to purchase or pledge, or issue any additional shares of, or securities

 

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convertible or exchangeable for, or warrants exercisable for, any Class A Common Stock, other than (i) in connection with the vesting or settlement of Company RSU Awards or Company PSU Awards outstanding as of the date of the Merger Agreement, in each case, in accordance with their terms or granted after the date of the Merger Agreement in accordance with clause (ii) or (ii) Company Compensatory Awards granted after the date of the Merger Agreement in accordance with certain parameters specified in the Company Disclosure Letter;

 

•

(i) make, declare, or pay any dividend or distribution (whether in cash, stock, or property or any combination thereof) on or in respect of any outstanding capital stock of, or other equity interests in, the Company or its subsidiaries, except for dividends and distributions by a wholly owned subsidiary of the Company to the Company or to another direct or indirect wholly owned subsidiary of the Company, (ii) split, combine, or reclassify any capital stock of, or other equity interests in, or issue or authorize or propose the issuance of any other securities in respect of, in lieu of, or in substitution for equity interests in the Company or any of its subsidiaries, or (iii) purchase, redeem, or otherwise acquire, or offer to purchase, redeem, or otherwise acquire, any shares in the capital of, or other equity interests in, any of the Company or its subsidiaries, except as between the Company and a wholly owned subsidiary of the Company or between wholly owned subsidiaries of the Company;

 

•

(i) enter into any new Tax Equity Agreement (as defined in the Merger Agreement) or materially modify, materially amend, assign, or waive any rights under or terminate any existing Tax Equity Agreement or (ii) except in the ordinary course of business, (A) enter into any contract that would be a material contract (other than Tax Equity Agreement) if it were in effect on the date of the Merger Agreement or (B) materially modify, materially amend, assign, or waive any rights under or terminate (excluding any expiration in accordance with its terms) any material contract (other than Tax Equity Agreement);

 

•

acquire any other Person or all or a material portion of the business of any other Person (whether by merger or consolidation, acquisition of stock or assets, or by formation of a joint venture or otherwise) or make any investment in any Person other than a wholly owned subsidiary of the Company, in each case, other than such acquisitions or investments as would not exceed $25,000,000 individually;

 

•

except as required by the terms of an existing employee benefit plan in existence as of the date of the Merger Agreement and set forth on the Company Disclosure Letter:

 

•

grant any severance or termination pay to (or amend any such existing agreement with) any of its current or former employees, directors, officers, or other individual service providers;

 

•

enter into, establish, adopt, materially amend, or terminate certain “plans” (as defined in the Merger Agreement) (excluding entering into offer letters for “at will” employment or individual independent contractor or consultant agreements with new hires as permitted below) or other benefit or compensation plan, program, contract, agreement, or arrangement that would be a “plan” if in effect on the date of the Merger Agreement (except any ordinary course amendments that do not increase the cost to the Company, in the aggregate, of maintaining such plan);

 

•

increase or accelerate the funding, payment, or vesting of the compensation or benefits payable to any of its current or former directors, officers, employees, or other individual service providers, other than annual merit increases to base salary or base wage rate in the ordinary course of business consistent with past practice for such individuals whose annualized base compensation would not equal or exceed $300,000 following such increase (provided that any increase does not cause the aggregate of all such employees’ annualized base compensation to exceed 105% of the total annualized base compensation in the aggregate for such employees as of December 31, 2024);

 

•

grant or announce any cash incentive awards, bonus retention, change in control, or transaction compensation payable to any current or former employees, officers, directors, or other individual service providers;

 

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•

hire, promote, or engage any employee, officer, or individual service provider whose annualized base compensation would equal or exceed $300,000; or

 

•

terminate the employment or engagement of any employee, officer, director, or individual service provider (other than for cause or due to death or disability) whose annualized base compensation would equal or exceed $300,000;

 

•

modify, extend, terminate, or enter into any collective bargaining agreement or other contract with a labor union or works council or recognize or certify any labor union, labor organization, works council, or group of employees as the bargaining representative for any employees;

 

•

implement or announce any employee layoffs, furloughs, reductions in force, plant closings, reductions in compensation, or other similar actions that would trigger notice obligations under the WARN Act;

 

•

intentionally waive or release any noncompetition, nonsolicitation, nondisclosure, or other restrictive covenant obligation of any current or former employee with a title of Vice President (or above) or independent contractor of the Company or any of its subsidiaries;

 

•

other than the Merger, merge, consolidate, combine, or amalgamate the Company or any of its subsidiaries with any Person or adopt a plan of complete or partial liquidation or resolutions providing for a complete or partial liquidation, dissolution, restructuring, recapitalization, or other reorganization of any of the Company or any of its subsidiaries;

 

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sell, lease, transfer, license, or otherwise dispose of, or agree to sell, lease, transfer, license, or otherwise dispose of, any material portion of its assets or properties, other than (i) transactions pursuant to contracts existing on the date of the Merger Agreement that are set forth on the Company Disclosure Letter, (ii) acquisitions of supplies or sales of inventory in the ordinary course of business, (iii) transfers among the Company and its wholly owned subsidiaries or (iv) sales, leases, transfers, licenses, or dispositions for which the consideration is less than $10,000,000 in the aggregate;

 

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incur, create, assume, repay, or otherwise become liable for indebtedness for borrowed money, or terminate or modify in any material respect in a manner adverse to the Company or its applicable subsidiaries, the terms of any indebtedness for borrowed money, or assume, guarantee, or endorse the obligations of any Person for indebtedness for borrowed money, other than (i) indebtedness incurred in connection with any action permitted by the Merger Agreement, (ii) intercompany loans between the Company and any of its wholly owned subsidiaries or between any wholly owned subsidiaries, and (iii) indebtedness (including indebtedness incurred pursuant to the Company Credit Facilities) reasonably incurred in response to any emergency, disaster, catastrophe, or other similar emergency condition to protect life, employee safety, property, or the environment or to comply with public requirements applicable; provided, however, that in the case of each of clauses (i) through (iii), such indebtedness (A) is not incurred under the APAG Revolver or APAGH Term Loan (each, as defined in the Merger Agreement) or (B) does not impose or result in any additional restrictions or limitations that would be materially adverse to the Company and its subsidiaries, or, following the Closing, Parent and its subsidiaries, other than any obligation to make payments on such indebtedness and other than any restrictions or limitations substantially similar to restrictions or limitations to which the Company or its applicable subsidiaries are currently subject under the terms of any indebtedness outstanding as of the date hereof; provided, further, that the Company shall promptly inform Parent of any indebtedness incurred or action taken in accordance with this clause and any such indebtedness or action shall not require any consent in order to complete the Transactions and shall not reasonably be expected to adversely affect Parent’s ability to consummate the Equity Financing or the Debt Financing; provided, further, that this clause did not restrict the Company or its applicable subsidiaries from entering into those certain consents which were required under the Company’s guaranty agreements with respect to each of the APAF III Term Loan, the APAF IV Term Loan, and the APACF II Facility (each, as defined in the Merger Agreement), in each case as a result of the execution of the Merger Agreement and as required to effect the Transactions (the “Required Debt Consents”), and this clause shall not restrict the Company or its applicable subsidiaries from entering into any and all waivers or consents

 

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(which may be effectuated in the form of an amendment or other modification) required with respect to the APAG Revolver (including the Ultimate Parent Guaranty, as defined in the APAG Revolver), the APAGH Term Loan, or the API L/C Facility (each, as defined in the Merger Agreement), in each case as a result of the execution of the Merger Agreement and as required to effect the Transactions (the “Other Debt Consents”);

 

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waive, release, assign, settle, or compromise any proceedings (other than any stockholder litigation relating to the Transactions) that (i) with respect to the payment of monetary damages, involves the payment of monetary damages exceeding $2,500,000 individually or $7,500,000 in the aggregate; (ii) with respect to any non-monetary terms and conditions therein, imposes or requires actions that would or would be reasonably expected to be material to the Company and any of its subsidiaries, taken as a whole; (iii) involves an admission of guilt or liability by the Company or any of its subsidiaries or would constitute a finding or admission of a violation of Law; (iv) would result in any restriction on future activity or conduct by Parent, the Surviving Corporation, or their subsidiaries; or (v) would prevent or materially delay the consummation of the Transactions;

 

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fail to use its commercially reasonable efforts to maintain in full force and effect in all material respects, or fail to replace or renew, the Insurance Policies at a level at least comparable to current levels (or current market terms);

 

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make or authorize any capital expenditures, except for those (i) that do not exceed $5,000,000 in the aggregate other than capital expenditures that are included in the Company’s capital expenditure budget for fiscal year 2025 set forth on the Company Disclosure Letter, or (ii) reasonably required in the event of an emergency, disaster, catastrophe, or other similar emergency condition to protect life, employee safety, property, or the environment or comply with public health requirements applicable thereto (provided that the Company shall notify Parent of any such emergency expenditure as soon as reasonably practicable);

 

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other than in accordance with Contracts in effect on the date hereof, make any loans or advances of money to any Person (other than for transactions among the Company and any of its subsidiaries), except for (i) advances to employees or officers of the Company and any of its subsidiaries for expenses or (ii) extensions of credit to customers, in each case, made or incurred in the ordinary course of business consistent with past practice and not in excess of $50,000;

 

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sell, transfer, assign, abandon, permit to lapse, or otherwise dispose of, or grant any license or sublicense of, any rights under or with respect to, any material intellectual property rights, except for non-exclusive licenses granted in the ordinary course of business;

 

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disclose to any Person any trade secret or other material confidential information of the Company or any of its subsidiaries other than to Persons subject to contractual, legal, or binding ethical obligations of confidentiality with respect to such information;

 

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(i) make, change, or rescind any material election relating to Taxes, (ii) change an annual Tax accounting period with respect to material taxes, (iii) adopt or change any material Tax accounting method, (iv) file any material amended Tax Return that is reasonably likely to result in a material increase to a Tax liability (other than as required pursuant to a “determination” within the meaning of Section 1313(a) of the Code (or any similar provision of state, local, or non-U.S. Law)), (v) enter into any closing agreement with respect to material Taxes, (vi) settle or compromise any material Tax claim, audit, assessment, or dispute or surrender any right to claim a material refund of Taxes, or (vii) agree to an extension or waiver of the statute of limitations with respect to the assessment or determination of any material Tax;

 

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except as required or permitted by GAAP, change any material accounting principles, methods, or practices;

 

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other than Permitted Liens or Liens relating to (i) securing indebtedness and other obligations in existence at the date of the Merger Agreement or any indebtedness incurred in compliance with the

 

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Merger Agreement or (ii) between the Company or to a subsidiary of the Company in connection with any indebtedness or loan to the extent not otherwise restricted by the Merger Agreement, create or incur any Lien on any assets of the Company or any of its subsidiaries; or

 

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authorize, agree to take, enter into any agreement, or otherwise become obligated to do, any of the foregoing.

Indemnification of Directors and Officers; Insurance

Parent has agreed that it will cause the Surviving Corporation to take all actions necessary or appropriate to ensure that, from and after the Effective Time, all rights to indemnification, exculpation, and advancement of expenses now existing in favor of (a) each present and former director, officer, and employee of the Company and its subsidiaries against any costs or expenses (including reasonable attorneys’ fees), judgments, fines, losses, claims, damages, or liabilities incurred in connection with any claim, action, suit, proceeding, or investigation, whether civil, criminal, administrative, or investigative, arising out of or pertaining to matters existing or occurring at or prior to the Effective Time, whether asserted or claimed prior to, at or after the Effective Time, to the fullest extent permitted under or required by applicable law or the respective certificates of incorporation, bylaws, or other organizational documents of the Company or its subsidiaries, as applicable, or indemnification agreements to which the Company or its subsidiaries, as applicable, are a party or otherwise bound, in each case as in effect on the date of the Merger Agreement and (b) each person entitled to such indemnification or exculpation under the provisions of the contracts set forth on the Company Disclosure Letter to the fullest extent permitted thereunder, in each case, will continue in full force and effect in accordance with its terms.

The Company may, and if the Company does not, Parent will cause the Surviving Corporation to, purchase a pre-paid, non-cancelable six-year “tail” policy (containing terms not less favorable than the terms of such current insurance coverage), of directors’ and officers’ liability insurance with respect to matters existing or occurring at or before the Effective Time; provided that in no event will the aggregate premiums payable for such “tail” policy or policies for its or their entire period exceed an amount equal to 300% of the current aggregate annual premiums paid by the Company for the existing directors’ and officers’ liability insurance.

Miscellaneous Covenants

The Merger Agreement contains additional agreements among the Company, Parent, and Merger Sub relating to, among other matters:

 

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the filing by the Company of this proxy statement with the SEC and cooperation in response to any comments from the SEC with respect to this proxy statement;

 

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the coordination of press releases and other public announcements or filings relating to the Transactions;

 

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actions required to cause the disposition of certain options, awards, and securities by individuals subject to the reporting requirements of Section 16(a) of the Exchange Act to be exempt from Section 16(b) of the Exchange Act;

 

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any stockholder litigation brought or threatened against the Company and/or its directors or its officers relating to or in connection with the Merger Agreement or any of the Transactions;

 

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the paying of expenses, fees, or concessions by the Company or any of its subsidiaries in connection with the Required Debt Consents or the Other Debt Consents;

 

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notice upon the occurrence of certain events, such as notices received from governmental authorities in connection with the Merger Agreement or the Transactions and any proceedings commenced or threatened against any party which relate to the Merger Agreement or the Transactions;

 

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the delisting of the Class A Common Stock from the NYSE and the deregistration of Class A Common Stock under the Exchange Act;

 

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actions necessary to cause Merger Sub to perform its obligations under the Merger Agreement;

 

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approval of the Merger Agreement and the Transactions by Parent as the sole stockholder of Merger Sub;

 

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actions required to ensure no takeover statute becomes applicable to the Merger Agreement, the Company Support Agreements, the Rollover Agreement, or the Transactions;

 

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Parent’s use of reasonable best efforts to obtain the Equity Financing pursuant to the Equity Commitment Letter entered into by Parent and its affiliates on the date of the Merger Agreement, as well as the Company’s commercially reasonable efforts to provide cooperation in connection with obtaining the Debt Financing; and

 

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unless applicable debt consents have been obtained, the repayment and termination of certain of the Company’s existing credit agreements with the lenders party thereto and delivery of a payoff letter in connection therewith;

Conditions to the Merger

The respective obligations of the Company, Parent, and Merger Sub to consummate the Merger and the other Transactions are subject to the satisfaction (or written waiver by all parties, if permissible under applicable law) at or prior to the Effective Time, of each of the following conditions:

 

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the Company will have obtained the Required Company Stockholder Approval;

 

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any applicable waiting period (and any extension thereof) under the HSR Act, and any commitment to, or agreement with, any governmental authority to delay the consummation of, or not to consummate before a certain date, the Merger, shall have expired or been terminated and the FERC 203 Approval shall have been obtained; and

 

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the consummation of the Transactions will not then be enjoined, prohibited, or made unlawful by any governmental order or any applicable law (whether temporary, preliminary, or permanent).

The obligations of Parent and Merger Sub to consummate the Merger are subject to the satisfaction (or waiver by Parent, if permissible under applicable law) at or prior to the Closing, of the following additional conditions:

 

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certain specified fundamental representations and warranties made by the Company will be true and correct, in each case, as of the Closing Date as if made at and as of the Closing Date (except to the extent that any such representation and warranty expressly speaks as of a particular date, in which case such representation and warranty will be true and correct only as of such date);

 

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certain representations and warranties with respect to the capitalization of the Company will be true and correct in all respects, except for any de minimis inaccuracies, as of the Closing Date as if made on the Closing Date (except for any such representations and warranties that speak as of a particular date, which will be true and correct in all respects, except for any de minimis inaccuracies, only as of such date);

 

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each of the other representations and warranties made by the Company (without giving effect to any references to any “Company Material Adverse Effect” or other materiality qualifications) will be true and correct in all respects as of the Closing Date as if made on the Closing Date (except for representations and warranties that speak as of a particular date, which will be true and correct in all respects only as of such date), in each case, except where the failure to be so true and correct has not had and would not reasonably be expected to have a Company Material Adverse Effect;

 

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the Company’s compliance with the covenants and obligations that the Company is required to comply with or perform under the Merger Agreement prior to the Closing in all material respects;

 

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since the date of the Merger Agreement, there will not have occurred any Company Material Adverse Effect (as defined under the section entitled “Proposal No. 1: The Merger Proposal—Representations and Warranties” of this proxy statement);

 

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the Required Debt Consents will have been obtained; and

 

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Parent will have received a certificate executed on behalf of the Company by its authorized representative to the effect that the conditions described in the six preceding bullet points have been satisfied.

The obligations of the Company to consummate the Merger and the other Transactions are subject to the satisfaction (or waiver by the Company, if permissible under applicable law), at or prior to the Closing, of the following additional conditions:

 

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certain specified fundamental representations and warranties made by Parent and Merger Sub will be true and correct in all respects as of the Closing Date as if made on and as of the Closing Date (except for representations and warranties that speak as of a particular date, which will be true and correct in all respects as of such date);

 

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each of the other representations and warranties made by Parent and Merger Sub in the Merger Agreement (without giving effect to any references to materiality qualifications) will be true and correct in all respects as of the date of the Closing Date as if made on and as of the Closing Date (except for representations and warranties that speak as of a particular date, which shall be true and correct in all respects only as of such date), in each case, except where the failure to be so true and correct has not had and would not reasonably be expected to have a material adverse effect on the ability of Parent and Merger Sub to consummate the Merger or perform their respective obligations under the Merger Agreement;

 

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Parent’s and Merger Sub’s compliance with the covenants and obligations that Parent and Merger Sub are required to comply with or perform under the Merger Agreement prior to the Closing in all material respects; and

 

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the Company will have received a certificate duly executed on behalf of Parent by its authorized representative to the effect that the conditions described in the three preceding bullet points have been satisfied.

Termination

The Merger Agreement may be terminated and the Merger and the other Transactions may be abandoned at any time prior to the Effective Time notwithstanding receipt of the Required Company Stockholder Approval (except as expressly noted), only as follows:

 

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by mutual written agreement of Parent and the Company.

 

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by either Parent or the Company:

 

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if the Closing has not occurred on or before 5:00 p.m. ET on November 5, 2025 (the “End Date”), whether such date is before or after the date of the receipt of the Required Company Stockholder Approval, so long as the terminating party’s failure to perform or comply with any covenant or obligation under the Merger Agreement is not the principal cause of, or did not result in, the failure of the Closing to have occurred on or before the End Date;

 

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if any governmental authority shall have issued, entered, enacted, or promulgated a governmental order or other applicable law permanently enjoining or otherwise permanently prohibiting or making unlawful, the consummation of the Transactions and such governmental order or other

 

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applicable law shall, if applicable, have become final and nonappealable, so long as the terminating party’s failure to perform any covenant or obligation under the Merger Agreement has not been the principal cause of, or resulted in, the issuance of such order, decree, or ruling or law; or

 

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if the Special Meeting (including any adjournments and postponements thereof) shall have been held and completed and the Company stockholders did not vote to adopt the Merger Agreement;

 

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by the Company:

 

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if there is a breach of any representation, warranty, covenant, or agreement set forth in the Merger Agreement on the part of Parent or Merger Sub such that the conditions to the Merger for the benefit of the Company relating to Parent’s and Merger Sub’s representations, warranties, covenants, and agreements cannot be satisfied at the Closing and has not been cured by the date that is the earlier of (x) 45 days after the Company notified Parent of such breach and (y) two business days prior to the End Date; provided that the Company will only have this termination right so long as there is no material breach of any of its material obligations under the Merger Agreement such that the conditions to the Merger for the benefit of Parent and Merger Sub relating to the Company’s representations, warranties, covenants, and agreements cannot be satisfied at the Closing;

 

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prior to receipt of the Required Company Stockholder Approval, in order to enter into a definitive agreement with respect to a Superior Proposal, so long as the Company has complied with the no-shop and related provisions in the Merger Agreement described in the section entitled “Proposal No. 1: The Merger Proposal—Other Covenants and Agreements—No Shop; Acquisition Proposals” of this proxy statement, the Company enters into such definitive agreement substantially concurrently with such termination, and the Company pays or causes to be paid to Parent the termination fee described below within five business days following such termination; or

 

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if (a) (i) the mutual conditions to the Merger for the benefit of the Company, Parent, and Merger Sub and (ii) the conditions to the Merger for the benefit of Parent and Merger Sub (in each case, other than conditions which are to be satisfied by actions taken at the Closing) have been satisfied or waived, (b) Parent failed to consummate the Closing or the Closing would have occurred pursuant to the terms of the Merger Agreement, (c) the Company delivered to Parent an irrevocable notice that (i) the Company stood ready, willing, and able to consummate the Closing on the date such notice is delivered and through the end of the next three-business day period, and (ii) all of the conditions to the Merger for the benefit of the Company (other than conditions that are to be satisfied by actions taken at the Closing) have been satisfied or waived, and (d) Parent failed to consummate the Closing within three business days following receipt of such notice from the Company described in the foregoing clause (c);

 

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by Parent:

 

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if there is a breach of any representation, warranty, covenant, or agreement on the part of the Company set forth in the Merger Agreement such that the conditions to the Merger for the benefit of Parent and Merger Sub relating to the Company’s representations, warranties, covenants, and agreements cannot be satisfied at the Closing and has not been cured by the date that is the earlier of (x) 45 days after Parent notified the Company of such breach and (y) two business days prior to the End Date; provided that Parent will only have this termination right if there is no material breach of any of its material obligations under the Merger Agreement on behalf of Parent or Merger Sub such that the conditions to the Merger for the benefit of the Company relating to Parent and Merger Sub’s representations, warranties, covenants, and agreements cannot be satisfied at the Closing; or

 

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