Evolving Beyond a Traditional Remediation Approach

Traditional Approach to Brownfields Solicit Bids from Contractors & Consultants Negotiate Contracts Possibly Hire Additional Staff Manage the Demolition & Remedial Work Comply with Permits Coordinate with Regulatory Authorities Manage Cleanup Agreements

Regulatory Uncertainty Brownfields Before A Catalyst Brownfields Remain at Rest Due to Inherent Uncertainty… Known Unknown Environmental Costs Approvals Zoning & Entitlements Delays Time Value of Money Project Timeframe Unclear Guidance Slow Response Times Regulatory Uncertainty Reticent Lenders Time Value of Money Financing Demolition Reclamation Repositioning Costs But where does a traditional cleanup get you in the context of brownfields…there is many areas of uncertainty for which a traditional approach does not advance the ball …and perhaps never reach their full redevelopment potential

Regulatory Uncertainty With a Catalyst The Removal of Uncertainty through Liability Assumption Providers… Assume all environmental liabilities and indemnify all parties Environmental Obtain zoning & entitlements for highest & best use Zoning & Entitlements Reach regulatory closure faster than PRPs and regulatory agencies Project Timeframe Provide certainty & indemnify against regulatory change Regulatory Uncertainty Increase the likelihood of lender engagement Financing Render the site as “Shovel ready” for vertical redevelopment Repositioning Costs But with a catalyst, like liability assumption—the outcome can be vastly different. Prepares Brownfields for Redevelopment

Liability Assumption Real Estate Purchase (optional) Transfer of Liability Fully-Funded Remediation Trust Environmental Insurance Corporate Indemnification Regulatory Compliance Repositioning for Redevelopment So what it meant by Liability Assumption? 4

Integrated with Brownfields Category #1 Category #2 Category #3 Real Estate Value Exceeds Environmental Liability Represents 60% of Brownfield Development But only 15% of Brownfield Sites Environmental Liability Exceed Real Estate Value (Polluter Pays) Represents 20% of Brownfield Development But only 25% of Brownfield Sites (No Polluter to Pay) But 60% of Brownfield Sites How does it work with Brownfields. Let’s look at the types of brownfields that we most often see. 6 6

Liability Assumption Scenarios Liability Assumption with Real Estate Purchase Liability Assumption Without Sale Leaseback and Creative Capital Solutions Available Guaranteed Fixed Price Remediation How can these brownfield deals be structured? 4

ELTC = (FMV) – (IC+EL+EI+CC+X+R+P) Methodology Assets Liabilities ELTC = (FMV) – (IC+EL+EI+CC+X+R+P) ELTC Environmental Liability Transfer Costs FMV Fair Market Value of Assets IC Investigative Costs EL Environmental Liabilities EI Environmental Insurance CC Carry Costs X Contingency R Repositioning Costs P Profit In these various scenarios, there are several factors to consider in structuring a transactions ELT’s assumption of environmental liabilities will exhaustively include all remedial issues that are known, unknown, above grade, at grade, below grade, onsite, offsite (but originating onsite and naturally migrating offsite) whether the issues occurred or were caused to occur in the past, present or future. 5

Brayton Point- Somerset MA

Brayton Point- Demolition 2018

Former Transformer Repair Facility- Buckhead Neighborhood

Former Transformer Repair Facility- Buckhead Neighborhood

Top Golf Redevelopment

Former Wood Treatment Facility- Port of Savannah

Former Wood Treatment Facility- Port of Savannah

Benefits of Transferring Environmental Liabilities Corporate Indemnification Affords the maximum allowable release and insulation from future liability with complete indemnification of the Seller. Financial and Economic Considerations Liability transference allows the Seller to report to stakeholders a financially more stable and liability free balance sheet. Guaranteed Cost Certainty Provides a fixed-cost solution for environmental obligations and uncertainties. Human Capital Relief Transferring environmental liabilities allows the Seller to focus on their core business and not be hindered with managing a cleanup project that exhausts time, energy and additional expenses. Elimination of Compliance Issues Assumes all regulatory compliance obligations, freeing up manpower and capital. Sustainability Benefits Following remediation, the site will be repurposed for its highest and best use, in line with any guidance set forth by the Seller. Brownfield remediation preserves the legacy and brand of the Seller when they cease operations, and provides ancillary benefits to the local community, such as job creation. Elimination of Regulatory Reopeners Assumes all environmental liabilities regardless of whether regulations change ensuring that environmental liabilities never revert back to the Seller/Transferer. 6

Contacts CORPORATE HQ Colleen Kokas 1515 Des Peres Road, Suite 300 St. Louis, MO 63131 ONLINE www.cdcco.com www.eltransfer.com www.enviroanalyticsgroup.com www.industrial-demolition.com www.industrial-recovery.com Colleen Kokas Executive Vice President Environmental Liability Transfer Email: Ckokas@eltransfer.com Phone: (215) 630-0482