Prime Sun Power Inc. Financing Agreement
This
Financing Agreement is
hereby made by and between Prime Sun Power Inc. (“Company")
and the subscriber set forth on the signature page hereto ("Subscriber"), dated
as of the date set forth on the signature page hereto (this “Agreement”).
WITNESSETH:
WHEREAS, Subscriber desires to
obtain Company’s right, title, and interest, in and to twenty percent (20%) of
net profits rights of the sales of Prime Sun Power Italia S.r.l. in Italy with
the assets which are composed of one hundred megawatt (100 Mwp) solar
photovoltaic (“PV”)
power plants (the “Net
Profit Rights”) to an institutional investor, upon the terms and subject
to the conditions hereinafter set forth;
WHEREAS, The Company’s purpose
is to serve as a utility company developing, building and operating PV power
plants in Italy as to which 100 Mwp licensed capacity will be sold;
WHEREAS, the Company desires
to accept special purpose financing offered by the Subscriber (the “Financing”),
whereby a condition of such Financing is the participation of Subscriber in the
Net Profit Rights described herein;
WHEREAS, in consideration of
the Financing
offered by Subscriber to the Company, the Company
desires to convey to Subscriber Net Profit Rights, consisting of 20% of the Net
Profit Rights of the sale of Prime Sun Power Italia S.r.l., in Italy that will
be determined according to the market standard accounting rules and the balance
sheet of the Company, upon the terms and subject to the conditions set
forth herein;
NOW, THEREFORE, in consideration
of the foregoing, the agreements herein contained, and other good and valuable
consideration the sufficiency of which are hereby acknowledged as adequate in
all respects, the parties hereto agree as follows:
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1.
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Conveyance:
Subscriber has hereby transferred the amount of €290,000.00 (Two Hundred
and Ninety Thousand Euros) and will transfer €180,000.00 (One Hundred
Eighty Thousand Euros) immediately following execution hereby for a total
of €470,000.00 (Four Hundred Thousand and Seventy Thousand Euros) (“Purchase
Price”) as consideration for the Company hereby conveying to
Subscriber the Net Profit Rights to Prime Sun Power Italia
S.r.l. Upon receipt of the full Purchase Price, all of the Net
Profit Rights shall be assigned to the Subscriber (the “Closing”).
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2.
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Reinvestment.
The Subscriber formally agrees to reinvest at least fifty percent (50%) of
the proceeds of the Net Profits Rights into one or both of the following
as determined by the Subscriber: (a) new projects of Prime Sun Power Inc.
or (b) shares of Prime Sun Power Inc., in each case at the purchase price
as mutually agreed by the parties. Determination of the
reinvestment and precise amount will be decided by both parties before
releasing the proceeds of the Net Profit Rights to the Subscriber,
provided, however not less than twenty percent (20%) of the proceeds from
the Net Profits Rights shall be delivered to the Subscriber not later than
ten (10) business days following the closing of each and every transaction
by the Company pertaining to the Net Profits
Rights.
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3.
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Subscriber
Representations and Warranties.
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The
Subscriber acknowledges that the offering and sale of the Net Profit Rights is
intended to be exempt from registration under the securities laws of the United
States and all other applicable jurisdictions and hereby acknowledges,
represents and warrants to all of the following:
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a.
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The
Subscriber represents and warrants that it is an individual, or a legal
entity regulated under the laws of the jurisdiction set forth on the
signature page hereto and the Subscribe is not “U.S. Person” as
such term is defined in Rule 902(k) of Regulations S promulgated under the
Securities Act of 1933, as amended. The Subscriber acknowledges
and agrees that it is acquiring the Net Profit Rights solely for its own
account for investment purposes only, and not with a view to, or for,
resale, distribution or fractionalization thereof in whole or in part; and
no other person has a direct beneficial interest in such Net Profit Rights
thereof or any portion thereof. The Subscriber does not have
any contract, undertaking, agreement or arrangement with any person to
sell, transfer or grant participations to such person or to any third
person, with respect to the Net Profit Rights for which the Subscriber is
subscribing or any part of the Net Profit Rights. The
Subscriber does not control, nor is the Investor controlled by or under
common control with, any other Subscriber or investor in the
Company. No person or persons other than Subscriber has a
beneficial interest subscribed hereunder. The Subscriber
acknowledges and agrees that the Net Profit Rights do not constitute an
equity investment in the Company and such rights are not publicly tradable
and will not become publicly tradable and may not be assigned by
Subscriber except in compliance with this
Agreement.
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b.
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The
Subscriber has full power and authority to enter into this Agreement, the
execution and delivery of this Agreement has been duly authorized, if
applicable, and this Agreement constitutes a valid and legally binding
obligation of the Subscriber.
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c.
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The
Subscriber is (i) experienced in making investments of the kind described
in this Agreement and the related documents, (ii) able, by reason of the
business and financial experience of its officers (if an entity) and
professional advisors (who are not affiliated with or compensated in any
way by the Company or any of its affiliates or selling agents), to protect
its own interests in connection with the transactions described in this
Agreement, and the related documents, and (iii) able to afford the entire
loss of its investment in the Net Profit Rights. The Subscriber
further understands that the Company is in inception stage of development
and has no Net Profit generating operations; the Company currently has no
agreements or arrangements with any persons in connection
therewith.
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d.
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The
Subscriber is aware that no federal or state governmental agency has (i)
made any finding or determination as to the fairness of this investment,
(ii) made any recommendation or endorsement of the Net Profit Rights or
the Company, or (iii) guaranteed or insured any investment in the Net
Profit Rights or any investment pertaining to the
Company
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e.
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The
Subscriber acknowledges its understanding that the offering and sale of
the Net Profit Rights is intended to be exempt from registration under the
securities laws of the United States and all other jurisdictions, and
furthermore acknowledges, represents and warrants to all of the following:
(i) The Subscriber acknowledges that the basis for the exemption from
registration of the Net Profit Rights may not be present if,
notwithstanding such representations, the Subscriber is merely acquiring
the Net Profit Rights for a short term fixed or short determinable period
in the future for less than one year, or for a market rise, or for sale if
the market does not rise, provided, however, the Subscriber reserves the
right to make decisions regarding disposition of the Net Profit Rights at
its own discretion; (ii) The Subscriber has the financial ability to bear
the economic risk of his investment, has adequate means for providing for
his current needs and personal contingencies and has no need for liquidity
with respect to his investment in the Company; (iii) The Subscriber has
such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of the prospective investment
in the Net Profit Rights, and the represents it has not been organized for
the purpose of acquiring the Net Profit Rights; (iv) The Subscriber has
been provided an opportunity for a reasonable period of time prior to the
date of signature by the Subscriber of this Agreement to obtain additional
information concerning the offering of the Net Profit Rights, the Company
and all other information to the extent the Company possesses such
information or can acquire it without unreasonable effort or
expense.
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f.
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The
Subscriber is not relying on the Company, or its affiliates or agents with
respect to economic considerations involved in this
investment. The Subscriber has relied solely on its own
respective advisors in making an investment determination. The
Subscriber has received all documents, records, books and other
information pertaining to the Subscriber’s investment in the Company that
have been requested by the Subscriber and the Company has answered
all questions of the Subscriber consistent with the information presented
in the Offering Memorandum.
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g.
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No
representations or warranties have been made to the Subscriber by the
Company, or any officer, employee, agent, affiliate or subsidiary of the
Company, other than the representations of the Company contained herein,
and in subscribing for the Net Profit Rights the Subscriber is not relying
upon any representations other than those contained herein. The
Subscriber has been furnished, has carefully read, and has relied solely
upon the information provided by the
Company.
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h.
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The
Subscriber will not offer to sell or sell the Net Profit Rights in any
jurisdiction unless the Subscriber obtains all applicable required legal
consents and regulatory approvals, including consent of the Company which
will not be unreasonably withheld.
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i.
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The
Subscriber understands that the prices of the Net Profit Rights bears no
relation to the assets, book value or net worth of the Company and were
determined arbitrarily by the Company. The Subscriber understands that an
investment in the Net Profit Rights is a speculative investment which
involves a high degree of risk and the potential loss of investment. The
Subscriber's overall commitment to investments which are not readily
marketable is not disproportionate to the Subscriber's net worth, and an
investment in the Net Profit Rights will not cause such overall commitment
to become excessive.
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j.
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The
Subscriber represents and warrants to the Company that the consideration
tendered by the Subscriber to the Company are not and will not be directly
or indirectly derived from activities that may contravene federal, state
and international laws and regulations, including anti-money laundering
laws;1 and the
OFAC prohibits, among other things, the engagement in transactions with,
and the provisions of services to, certain foreign countries, territories,
entities and individuals. The lists of OFAC prohibited
countries, territories, persons and entities can be found on the OFAC
website. The Subscriber hereby represents and warrants, to the
best of its knowledge, that none of the Subscriber, any person
controlling, controlled by, or under common control with, the Subscriber,
any person having a beneficial interest in the Subscriber, or any person
for whom the Subscriber is acting as agent or nominee in connection with
this investment is: a country, territory, individual or entity named on an
OFAC list, or is an individual or entity that resides or has a place of
business in a country or territory named on such lists, a
senior foreign political figure2, or any immediate
family member3
or close associate4 of a senior foreign
political figure within the meaning of the U.S. Department of Treasury’s
Guidance on Enhanced Scrutiny for Transactions That May Involve the
Proceeds of Foreign Official Corruption5 and as referenced
in the USA Patriot Act of 2001;6 or a "foreign shell
bank"7 and does
not transact business with a "foreign shell bank." The Subscriber agrees
to promptly notify the Company should the Subscriber become aware of any
change in the information set forth in these
representations. The Subscriber understands that, by law, the
Company may be obligated to "freeze the account" of such Subscriber,
either by prohibiting additional amounts, declining any redemption
requests and/or segregating the assets in the account in compliance with
governmental regulations, and the Company may also be required to report
such action and to disclose the Subscriber’s identity to OFAC. The
Subscriber understands that the Company may not accept any contributed
amounts from the Subscriber if the Subscriber cannot make the
representation set forth above and the Company may return any amounts to
Subscriber if the information provided to the Company is incomplete or is
deemed suspicious. The Subscriber represents and warrants that
the acceptance of this Agreement together with the appropriate remittance
will not breach any applicable anti-money laundering rules and
regulations. The Subscriber undertakes to provide verification of
its identity reasonably satisfactory (on a confidential basis), to the
Company and/or any entity acting on the Company’s behalf in respect of the
acceptance of this Agreement, promptly on
request.
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1 See, U.S. Treasury Department’s Office of
Foreign Assets Control ("OFAC") website at xxxx://xxx.xxxxx.xxx/xxxx.
2 A
“senior foreign political figure” is defined as a current or former official in
the executive, legislative, administrative, military or judicial branches of a
non-U.S. government (whether elected or not), a senior official of a major
non-U.S. political party, or a senior executive of a non-U.S. government-owned
corporation. In addition, a “senior foreign political figure”
includes any corporation, business or other entity that has been formed by, or
for the benefit of, a senior foreign political figure.
3
“Immediate family” of a senior foreign political figure typically includes the
figure’s parents, siblings, spouse, children and in-laws.
4 A “close
associate” of a senior foreign political figure is a person who is widely and
publicly known to maintain an unusually close relationship with the senior
foreign political figure, and includes a person who is in a position to conduct
substantial domestic and international financial transactions on behalf of the
senior foreign political figure.
5 Please see xxxx://xxx.xxxxxxxxxxxxxx.xxx/xxxxxxxxx/xxxxxxxxx/0000/xx0000x0.xxx for a more extensive discussion of the
referenced terms and definitions.
6 The
Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001, Pub. I. No. 107-56
(2001).
7 A
“foreign shell bank” is a foreign bank that does not have a physical presence in
any country.
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4.
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Development
Stage. Except as provided herein, Company does not give or make
any representations or warranties to Subscriber in connection with the Net
Profit Rights. The Net Profit Rights are hereby purchased and conveyed “as
is,” “where is,” and Company makes no representations or warranties of any
nature whatsoever with respect to the Net Profit Rights, including no
representation or warranty as to whether or not any subject matter
underlying the Net Profit Rights meets applicable electrical, machine
guarding and/or other environmental, health and safety regulations,
parameters or operational conditions. Subscriber acknowledges
and agrees that Subscriber is not relying on any additional
representations or warranties of any kind whatsoever, express, oral,
statutory or implied. No implied statutory warranty of merchantability or
fitness for a particular purpose applies
hereby.
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5.
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Obligations:
Any tax obligation or liability that may accrue in connection with the Net
Profit Rights or payment of the Purchase Price or otherwise in connection
with this transaction, or in any way arising in connection with the Net
Profit Rights, including without limitation, any and all Value Added Tax,
shall be at the sole account and charge of
Subscriber.
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6.
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Modification. Neither
this Agreement nor any provisions hereof shall be modified, discharged or
terminated except by an instrument in writing signed by the party against
whom any waiver, change, discharge or termination is
sought.
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7.
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Successors
and Assigns. This Agreement and the Net Profits Rights are not
transferable or assignable by the Subscriber without the written consent
of the Company which shall not be unreasonably withheld, subject to
compliance with all laws, rules and applicable regulations. The
provisions of this Agreement shall be binding upon and insure to the
benefit of the parties hereto and their respective successors and
assigns. The rights of the Company under this Agreement may be
assigned by the Company without consent of the Subscriber provided that
all obligations of performance on the part of the Company shall otherwise
remain subject to performance by the
Company.
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8.
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Determinations. Subscriber
has had ample opportunity to engage counsel or third party experts to
independently assess and conduct due diligence of all terms, conditions,
status of underlying materials, equipment, land options, third party
agreements and all required governmental approvals underlying the Net
Profit Rights, and Subscriber has independently determined to proceed with
this Agreement.
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9.
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Dispute
Resolution. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York, without giving
effect to conflicts of law principles. The invalidity or
unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this
Agreement. All disputes and controversies arising out of or
relating to this Agreement shall be finally settled and binding under the
Rules of International Commercial Dispute Resolution of the American
Arbitration Association (“ICDR”). The place of arbitration
shall be New York. The Arbitration shall be conducted in
English by a single arbitrator appointed in accordance with the ICDR
rules. Any award, verdict or settlement issued under such
arbitration may be entered by any party for order of enforcement by any
court of competent jurisdiction. The arbitrator shall have no
power to take interim measures he or she deems necessary, including
injunctive relief and measures for the protection or conservation of
property.
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10.
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11.
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Indemnity. The
Subscriber agrees to indemnify and hold harmless the Company, its officers
and directors, employees and its affiliates and their respective escrow
agents, successors and assigns and each other person, if any, who controls
any thereof, against any loss, liability, claim, damage and expense
whatsoever (including, but not limited to, any and all expenses whatsoever
reasonably incurred in investigating, preparing or defending against any
litigation commenced or threatened or any claim whatsoever) arising out of
or based upon any false representation or warranty or breach or failure by
the Subscriber to comply with any covenant or agreement made by the
Subscriber herein or in any other document furnished by the Subscriber to
any of the foregoing in connection with this transaction. The Subscriber
releases, indemnifies and holds harmless the Company’s attorneys in
connection with receipt of the Purchase Price into the attorney trust
account as escrow agent and irrevocable transmission of such funds to the
Company.
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12.
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Notices. Any
notice, demand or other communication which any party hereto may be
required, or may elect, to give to party hereto shall be sufficiently
given if (a) sent by registered or certified mail, return receipt
requested, addressed to the receiving party’s address as provided herein,
(b) sent by internationally recognized courier with confirmation of
delivery or evidence of refusal; or (c) delivered personally at such
address. In the case of the Company, all notices shall be
deemed given two business days after mailing to the Subscriber; and in the
case of the Subscriber, all notices shall be deemed given to the Company
upon written confirmation of receipt by the Company. The
Company may give notice of acceptance of this Agreement by verbal advice,
e-mail or fax to any address or phone number provided to the Company by
the Subscriber on the Signature page
below.
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13.
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Entire
Agreement: This Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof together with that
certain Note issued by the Company and dated as of even date herewith,
which is hereby incorporated herein by reference thereto, and supersedes
all prior agreements, understandings and negotiations, both written and
oral, between the parties with respect to the subject matter of this
Agreement. In the event of any conflict between the Note and this
Agreement, this Agreement shall control. No other
representation, inducement, promise, understanding, condition or warranty
not set forth herein or in the Note has been made or relied upon by either
party hereto.
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14.
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Survival:
The covenants, agreements, indemnities, representations and warranties
contained in this Agreement shall survive the signing and Closing of this
Agreement.
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15.
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Counterparts;
Effectiveness. This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument. Similarly,
facsimile copies shall be given the same binding effect as
originals.
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[Signature
Page Follows]
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IN
WITNESS WHEREOF, the Subscriber has executed this Agreement for the Purchase of
the Net Profit Rights:
Purchase Price :
**€470,000.00 (Four Hundred
Seventy Thousand Euros)**
SUBSCRIBER:
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Print
Full Legal Name:
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CRG Finance
AG
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Address:
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23, Bahnhofstrasse – CH-6300
Zug
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Purchaser:
CRG Finance AG
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By
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(Signature):
/s/ Xxxxxx Xxxxxxxxx
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Print
Name:
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Xxxxxx
Xxxxxxxxx
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Title:
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President
and CEO
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The
Company hereby accepts the above application for subscription for the Net Profit
Rights set forth above as of this 2nd day
of March, 2010:
Prime
Sun Power Inc.
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By:
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/s/ Xxxxxx de Vergnies
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Name:
Olivier de Vergnies
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Title:
Chief Executive Officer
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Prime
Sun Power Inc. – Financing Agreement
Wiring
Instructions
For
Payment of the Purchase Price of the Net Profit Rights:
The
following are the wire instructions for the account into which the payment of
the Purchase Price for the Net Profit Rights subscribed should be wired upon
acceptance of the Agreement by the Company.
Prime Sun
Power S.r.l. Italia
Unicredit
Banca SPA
Agenzia
08060 Torino Politecnico
X/X
Xxxxxxxxxxx Xxx X'Xxxxxx, 0 Xxxxxx 00000, Xxxxx
Account
Number: 000100826846
IBAN:
XX00X0000000000000000000000
BIC:
XXXXXXX0XX0
FOR
PROPER CREDIT, PLEASE MAKE SURE THAT THE WIRE TRANSFER INFORMATION CLEARLY
INCLUDES THE NAME OF THE SUBSCRIBER OF RECORD. PLEASE RETAIN A COPY
OF ALL WIRE TRANSFERS INSTRUCTIONS AND CONFIRMATIONS.
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