solar 350 eis brochure

ENTERPRISE INVESTMENT SCHEME PLACINGOffEREd fOR SubSCRIPTION: 350,000 A SHARES PRICEd AT £14.00

SOLAR 350 LTd22 Hanover Square, London, w1S 1jp T: 0203 151 1 350 F: 0203 151 9 350 w: solar350.co.uk

Solar 350 Ltd Registered Office: Unit 42, The Coach House, St Mary’s Business Centre,66-70 Bourne Road, Bexley, Kent. DA5 1LU T: 0203 151 1 350 T: 0203 151 9350 w: solar350.co.uk

Solar 350 Ltd is registered in The United Kingdom under Company Number: 07678367

Commercial Solutions to Climate Change

This offer will open on the 1st of May 2013 and close on Friday 7th of June 2013 or when fully subscribed, whichever is sooner

In the event that Solar 350 does not raise at least £3,000,000 across SEIS, EIS and Institutional Placings, all funds received will be returned to investors with no deductions

Seed enterprise investment scheme offers also available

Allocations based on completed subscription documents, KYC documentation and cleared funds.

For High Net Worth and Sophisticated Investors Only

http://www.solar350.co.uk

1. Executive Summary

2. The fight against Global Warming

3. Solar 350 Ltd3.1 Grue og Hornstrup A/s3.2 Solar 350’s Board3.3 Additional Team Members3.4 Corporate Participants3.5 Organisational Structure for 2013

4. Renewable Energy Markets4.1 Solar Voltaic Technology4.2 Solar Design provided by

Grue and Hornstrup A/s4.3 Solar Projects Due Diligence4.4 Solar Projects Undergoing Due Diligence

5. Key Performance Indicators5.1 Solar Irradiation5.2 Renewable Energy Subsidy5.3 Electricity Price5.4 Existing Energy Generation5.5 Land and Labour Cost

6. Mitigation of Solar Risks

7. financials7.1 Valuation7.2 Financial Illustration7.3 Cash flow7.4 Notes

8. SEIS Tax Reliefs8.1 EIS Tax Reliefs 8.2 Further Information on Tax Relief8.3 Suitability8.4 Corporate Governance

9. Addendum and Supporting InformationA Certificate of IncorporationB Certificate of Name Change

INDEX

C Financial Information on Solar 350D Stakeholders ShareholdingE Shareholdings Post Equity RaiseF Stakeholder AgreementsG Additional References for G+H A/sH Project Design and SlateI Solar EquipmentJ Equipment Transport AssessmentK Project CostingsL O&M Cost BreakdownM 1st Year G&A Cost BreakdownN Future Year G&A Cost BreakdownO Cash Flow Forecast Sample ProjectP Letter of Intent for Equipment and

Mezzanine FinanceQ Conditional Letter of Intent for

Debt FinanceR EU Press Release on Romania’s Green

Certificate SchemeS Opinion on Romania’s Green Certificate

Scheme by Grue og Hornstrup & Supporting Press Releases in Romanian and English

T Legal Opinion on Romanian Green Certificate Scheme

U Confirmation of Advanced Assurance in Relation to Tax Status from HMRC

10. Subscription bundle10.1 Procedure10.2 Terms and Conditions of the Restricted

Offer10.3 Application Form10.4 Agreement10.5 Statement of High Net Wealth Status10.6 Statement of Sophisticated Investor

Status

1 Within this document SOLAR 350 LTD shall be known as SOLAR 350.

IMPORTANT INFORMATION

This information memorandum has been delivered to in-terested parties for information only and on the express understanding that they shall use it only for the purpose set out above. SOLAR 350 gives no undertaking to pro-vide the recipient with access to any additional informa-tion or to update this information memorandum or any additional information, or to correct any inaccuracies in it which may become apparent, and it reserves the right, without giving reasons, at any time and in any respect, to amend or terminate the procedure for the issue of its shares or to terminate negotiations with any prospective purchaser. The issue of this information memorandum shall not be deemed to be any form of commitment on the part of SOLAR 350 to proceed with any transaction.

This information memorandum is being distributed on the basis that each person in the United Kingdom to whom it is issued is reasonably believed to be such a person as is described in Article 19 (Investment profes-sionals) or Article 48 (certified high net worth individu-als) or Article 50 (certified sophisticated investors) or Article 50A (self-certified sophisticated investors) or Ar-ticle 49 (High net worth companies, unincorporated as-sociations etc.) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 as amended or is a person to whom this information memorandum may otherwise lawfully be distributed. Persons who do not fall within such descriptions may not act upon the information contained in it.

This communication is exempt from the general restric-tion (in section 21 of the Financial Services Act 2000) on the communication of invitations or inducements to engage in investment activity on the grounds that it is made to professionals/ certified high net worth individu-als / self-certified investors. You should consider carefully any decision to engage in investment activity to which the communication relates.

If you are in any doubt about the investment to which the communication relates you should consult an autho-rised person specialising in advising on investments of the kind in question.

This information memorandum is being issued by SOLAR 3501 to a limited number of parties in connec-tion with the issue of shares in SOLAR 350.

The content of this promotion has not been approved by an authorised person within the meaning of the Finan-cial Services and Markets Act 2000. Reliance on this pro-motion for the purpose of engaging in any investment activity may expose an individual to a significant risk of losing all of the property or other assets invested.

The purpose of this information memorandum is to as-sist the recipient in deciding whether it wishes to pro-ceed with further investigations of SOLAR 350’s offering. This information memorandum does not constitute an offer or invitation for the sale or purchase of securities or any of the businesses or assets described in it.

The information in this information memorandum, which does not purport to be comprehensive, has been provid-ed by SOLAR 350 and has not been independently veri-fied. While this information has been prepared in good faith, no representation or warranty, express or implied, is or will be made and no responsibility or liability is or will be accepted by SOLAR 350 or by any of its respective of-ficers, employees or agents in relation to the accuracy or completeness of this information memorandum or any other written or oral information made available to any interested party or its advisers and any such liability is expressly disclaimed. In particular, but without prejudice to the generality of the foregoing, no representation or warranty is given as to the achievement or reasonable-ness of any future projections, management estimates, prospects or returns contained in this Memorandum or in such other written or oral information.

No information set out or referred to in this information memorandum shall form the basis of any contract. Any prospective purchaser of shares in SOLAR 350 shall be required to acknowledge that it has not relied on or been induced to enter into such an agreement by any repre-sentation or warranty, save as expressly set out in such agreement.

This information memorandum is not being distributed to persons outside the UK. However, any recipient of this information memorandum in jurisdictions outside the UK should inform themselves about and observe any appli-cable legal requirements. This information memorandum does not constitute an offer to sell or an invitation to pur-chase securities in the Company in any jurisdiction.

This information memorandum shall not exclude any li-ability for, or remedy in respect of, fraudulent misrepre-sentation.

By accepting this information memorandum, the recipi-ent agrees to be bound by the foregoing limitations. If you have not received this document directly from SO-LAR 350, your receipt is unauthorized. Please return this document to SOLAR 350 LTD immediately or delete any electronic copies.

IMPORTANT INFORMATION (Cont.)

2 Outside Investors being investors not directly connected to the business’s operations

3 http://ec.europa.eu/clima/policies/package/index_en.htm4 http://www.350ppm.co.uk/0projects

icant political momentum to encourage energy genera-tion from renewable sources. This presents a significant opportunity for companies and investors to participate in the emerging ‘green economy’.

To promote these changes, Governments around the world have set challenging targets to reduce sovereign emissions and promote renewable energy generation. The European Union has been a leader in this field.

The EU’s Climate and Energy Package3 is a set of bind-ing legislation which aims to ensure the European Union meets its ambitious climate and energy targets for 2020. These targets, known as the “20-20-20” targets, set three key objectives for 2020. These are:

> A 20% reduction in EU greenhouse gas emissions from 1990 levels;

> Raising the share of EU energy consumption produced from renewable resources to 20%;

> A 20% improvement in the EU’s energy efficiency.

A commitment to support the shift to renewable energy has now been made by the majority of OECD countries. The form of regulatory and policy support varies from measures such as caps on industrial emissions to price support mechanisms to stimulate capital investment in renewable energy infrastructure.

Solar 350

Solar 350 (formerly Carbon 350 Direct Limited) was formed in June 2011. The company is linked via its per-sonnel to Carbon 350 Ltd. Carbon 350 was formed in 2008 and went on successfully to broker and/or Exec-utive Develop 214 Carbon Abatement / Green Energy Projects with an aggregate Capex of in excess of €1

Planning for Solar 350 Ltd officially began in May 2012.

The stakeholders of Solar 350 are the team behind the 350 Group (www.350ppm.co.uk) and Grue og Hornstrup A/S, (http://www.g-h.dk/) the Danish Engineering Company.

As of 15th April 2013, all components of the businesses op-eration have been identified and sourced. Documents sup-porting these developments can be found in Section 9.

Solar 350’s business model, just like solar power, is highly scalable. Significant efforts have been made to reduce fixed costs to a minimum and ensure that Solar 350’s management’s objectives are aligned with the share-holders.

Solar 350 is now launching SEIS, EIS and Institutional Eq-uity Placings aiming to raise circa £7.9 Million in equity. This equates to a 2013 CAPEX of £31M when combined with debt finance.

Subject to Solar 350 raising at least £3M, the placing and issuance of shares will proceed. In the event that Solar 350 does not raise at least £3M, all funds raised via this placing will be returned to investors with no deductions or charges.

The £3M mark relates to approximately 2 Mega Watts of installed capacity.

background

As global energy demands increase, the existing domi-nance of fossil fuels in the energy generation sector is becoming increasingly unsustainable.

In addition, there has been a growing consensus that a reduction of carbon emissions is vital to avoid the risk of climate change. These factors have brought about signif-

EXECUTIVE SUMMARY

5 Grue og Hornstrup A/S is the full Danish Company name. The English translation is Grue and Hornstrup A/s. In this document, we use G+H to refer to Grue og Hornstrup A/s.6 http://www.g-h.dk/uk/profile.html

3 http://ec.europa.eu/clima/policies/package/index_en.htm

http://www.350ppm.co.uk/projects

http://www.g-h.dk/uk/profile.html

Solar 350’s objective is to install 20MW of Solar Power in Romania in 2013 and 100MW of Solar Power in 2014 and each subsequent year. Our country focus is not lim-ited to Romania. However, we have selected Romania because of a number of factors:

> Romania’s day time electricity price averages circa €55 per MWh, and peaks at over €70 during the peak hours of the day7. This is a relatively high en-ergy price. The electricity market in Romania is de-regulated and the market is traded via the OPCOM exchange. Thus, our output (electricity) can be sold at a relatively good price in a liquid market.

> Romania offers an EU Approved Subsidy Program8

though the issuance of Green Certificates for every MWh of electricity produced from renewable energy. The Green Certificate Program is running well and again is a liquid market. Thus our second output (Green Certificates), can be sold at a rela-tively high price in a liquid market. Once capacity is installed, the Green Certificate program runs for 15 years under the terms of the subsidy in the year of installation.

> Energy Generation in Romania is currently highly carbon intensive. Romania possesses huge re-sources of coal and thus historically, they have based their energy generation strategy on coal fired power stations. In order to comply with the EU legislation of 20% of energy generation com-ing from renewable means by 2020, and to achieve their own renewable energy targets, it is necessary that Romania increases it’s renewable energy instal-lations significantly. In addition to this, any increase

billion. (Executive Development being the identifica-tion, due diligence, accreditation, development and subsequent sale of assets created through carbon abatement projects).

The objective of Solar 350 is to develop and commer-cialise projects for the benefit of the company’s share-holders. SOLAR 350 aims to exploit the commercial potential for solar energy generation in countries that exhibit favorable characteristics for solar energy gen-eration. These characteristics are defined below.

In September of last year (2012) Solar 350 signed a Memorandum of Understanding with Grue of Horn-strup5 A/S (“G+H”). G+H is an AA rated6 Danish engi-neering consultancy with extensive experience within renewable energy, environmental technologies, energy management and carbon abatement projects.

Under this Memorandum of Understanding (MOU), G+H will act as Consulting Engineers on all Solar 350’s projects and will source and manage the acquisition and develop-ment of Solar Projects on behalf of Solar 350. G+H has agreed to defer their fees until Solar 350 is in a position to pay them. In February 2013, under the terms of the MOU, G+H purchased a 50% share in Solar 350 Ltd.

1. EXECUTIVE SUMMARY (Cont.)

7 http://www.opcom.ro/pp/grafice_ip/raportPIPsiVolumTranzactionat.php?lang=en (daily prices by hour)8http://europa.eu/rapid/press-release_IP-11-867_en.htm9http://www.gfmag.com/gdp-data-country-reports/194-romania-gdp-country-report.html#axzz2IpJ6rJxy10http://www.gfmag.com/gdp-data-country-reports/194-romania-gdp-country-report.html#axzz2IpJ6rJxy

High Electricy PriceSignificant subsidy

available and stable sovereign credit rating

Existing energy generation is highly carbon intensive

Low land and labour costs relative to other

performance indicators

High levels of Solar irradiation

http://www.opcom.ro/pp/grafice_ip/raportPIPsiVolumTranzactionat.php?lang=en

http://europa.eu/rapid/press-release_IP-11-867_en.htm

http://www.gfmag.com/gdp-data-country-reports/194-romania-gdp-country-report.html#axzz2IpJ6rJxy

ttp://www.gfmag.com/gdp-data-country-reports/194-romania-gdp-country-report.html#axzz2IpJ6rJxy

10http://www.gfmag.com/gdp-data-country-reports/194-romania-gdp-country-report.html#axzz2IpJ6rJxy11Please note: within this document we have assumed the GBP/EURO Currency Rate to be 1.16.12This is the anticipated level of mezzanine finance provided; 80% Mezzanine to 20% equity. We have modelled 75% mezzanine to 25% equity in the financial illustration.13Please see Letter of Intent for mezzanine finance in Addendum Section.

in the carbon price should increase the price of electricity in Romania significantly. This would not be the case in countries whose Renewables per-centage capacity is higher.

> Romania, while growing at 2.5% per annum9, with a BBB+ Stable Credit Rating and with unemployment at 7.2%10 and falling, still has relatively low land and labour costs. Hence, the costs to build and subse-quently operate the installations will be relatively low relative to other factors.

> In terms of Solar Irradiation, Romania is one of the preferred locations across Europe with 3.4 Hours of peak sunshine per day and up to between 1400-1500 KWh/m2 of sunlight. The United Kingdom, at its most southern point receives 1000-1100.

> In addition to the above factors, which make the business case for Romanian Solar generation, So-lar 350’s management have been active in Roma-nia since 2010 through a branch office of Carbon 350 Ltd (Solar 350’s sister company) and G+H have been active in the Romanian Market since 1998.

Recent developments

Solar 350 has now identified 4 Solar Projects to acquire and commercialise. G&H are negotiating, on behalf of Solar 350 Ltd for the purchase of the rights to these projects. In addition to these projects we are complet-ing due diligence on additional projects. These addi-tional projects can be found in Section 9H of this docu-ment,

1. EXECUTIVE SUMMARY (Cont.)

We have also conducted discussions with a Chinese Solar Panel Manufacturer that is willing to provide both Solar Panels and project finance for the initial build of the projects (on the condition that an exit is provided to the manufacturer once the project is complete). The most likely source of these funds are from either Chi-nese banks or the Chinese Export Bank, which is ru-mored to have over €50 billion of financing capacity to assist in the promotion of Chinese industry. Within this document we have termed this “Mezzanine Finance”. A Letter of Intent from the Solar Panel Manufacturer can be found in Section 9P. We have removed reference to the actual supplier for obvious reasons.

We have also identified a number of European Banks that, once the project is completed and producing elec-tricity, have indicated their potential interest to lend to the project, replacing the mezzanine finance provided by the Chinese Export Bank.

Lately, we have identified a European Lender who has offered to provide debt finance to the projects. In this case, the debt finance would be a single step approach where the lender lends to the project pre-build phase with the tenure of the loan being 10 years. The interest rate on this loan would be 8%. Details of this offer can be found in Section 9Q on page 82.

Returns

Throughout this document we are basing our assump-tions on utilizing a debt to equity ratio of 75/25. This has been confirmed by our potential lenders. Utilizing debt finance allows us to leverage the operations of the busi-ness significantly.

ttp://www.gfmag.com/gdp-data-country-reports/194-romania-gdp-country-report.html#axzz2IpJ6rJxy

pacity, after General & Administration Fees (15% of oper-ating profit) and while servicing debt finance, Solar 350 generates circa £2M of free cash flow every year.

This free cash flow can be utilized to scale the opera-tions of the company further. Based on our model with-in Romania; £2M of free cash flow reinvestment equates to a further 5MW of installed capacity each year.

Conversely, in the event that debt finance is not forth-coming, Solar 350 may consider issuing an additional 20% of equity to existing investors and financing with 100% equity. In this case, the equity ROI for investors before tax benefits are taken into account are 45.40%.

future Plans

Please note, Solar 350 reserves the rights to develop other renewable energy installations in addition to Solar in future years subject to the following:

> the additional development would enhance the commercial returns of a Solar site (for instance Wind+Solar combined) and, or;

> the stakeholders have a successful record of de-velopment in the specific project type (for example Hydro Electric (350) or Biomass Combined Heat and Power (CHP) in the case of G+H.

In order to complete our objective of 20MW in 2013, in total, Solar 350 needs to sell 600,000 Shares (60% of Solar 350) at an average price of £13.20. A placement price of £13.20 when matched with 75% of debt finance creates an equity IRR of 28% and a ROI of 197%.

These figures are based on an exit strategy where the business is valued at the end of every year from year 3 to year 12 and each year Solar 350 offers to repurchase 10% of investor shares at the valuation level. We cannot guarantee we will adopt this strategy and it is in no way a predetermined exit yet it does provide a method of measurement for equity returns. In terms of actual exit strategy, Solar 350 objective is to list on an exchange within three years. Thus, this will provide investors with a suitable exit point should they wish for one.

SEIS and EIS investors will notice that they are paying a small premium to the average share price. This is be-cause Solar 350 anticipates the majority of equity fund-ing will come from institutional investors.

In terms of returns to the SEIS and EIS Investor, a place-ment price of £14.00 provides for an overall Return on Investment (ROI) of 136% before tax reliefs and tax ben-efits are taken into consideration. Please see pages 44 and 45 for SEIS and EIS financial illustrations.

It may be worth nothing that this calculation does not take into account the following: At 20MW of installed ca-

14 http://www.esrl.noaa.gov/gmd/ccgg/trends/15 National Snow and Ice Data Centre: http://nsidc.org/cryosphere/quickfacts/icesheets.html

The Intergovernmental Panel on Climate Change (IPCC) was formed by the United Nations in 1988 to prove the link between Green House Gas concentrations and glob-al warming.

This chart details the increases in CO2 Concentrations over the last 50 years14:

Subsequently, the United Nations formed its climate change division, the UNFCCC (United Nations Frame-work Convention on Climate Change) to assist in the fight against Climate Change and assist poorer coun-tries to adapt to the changes climate change will bring.

During the 1990’s global negotiations began to estab-lish a global treaty in order to fight climate change and to deal with the anticipated effects of climate change, both from a humanitarian and economic point of view. Greater concentrations of Green House Gases in the at-mosphere were expected to result in increasing global

2. THE FIGHT AGAINST GLOBAL WARMING

temperatures. This would lead to changes in ecosys-tems, wild fires, droughts, increases in desert areas and increased precipitation, which in turn was expected to lead to freak weather events including hurricanes, torna-does, and flooding.

Of serious concern is the increase in global temperatures through the erosion of the world’s ability to regulate its own temperature within predefined limits through:

I. The erosion/destruction of carbon sinks (the forests and vegetation) through fire leading to further GHG emissions, leading to further global warming.

II. The oceans ability to absorb CO2 and the potential for temperature increases within the oceans resulting in methane releases from the sea bed, leading to fur-ther global warming.

III. Reductions in ice leading to increasing absorption of heat from the sun and less reflection of the sun’s rays back into the atmosphere, leading to further global warming.

IV. Increased development and burning of fossil fuels.

However, the ultimate concern results from the melting of sea ice, the melting of the Greenland ice sheets (includ-ing the Arctic) and the melting of ice in Antarctica. For unknown reasons, increases in global temperature are especially pronounced at the top and bottom of the globe.

If the Greenland Ice Sheet melted, scientists estimate that sea level would rise about 6 meters (20 feet). If the Antarctic Ice Sheet melted, sea level would rise by about 60 meters (200 feet)15.

http://www.esrl.noaa.gov/gmd/ccgg/trends/

http://nsidc.org/cryosphere/quickfacts/icesheets.html

16 http://www.ipcc.ch/publications_and_data/ar4/wg1/en/faq-5-1-figure-1.html17European Commission: http://ec.europa.eu/clima/policies/package/index_en.htm

This chart details Sea Level rise projections to 2100:

Past and projected global average sea level: The gray shaded area shows the estimates of sea level change from 1800 to 1870 when measurements are not available. The red line is a reconstruction of sea level change measured by tide gauges with the surround-ing shaded area depicting the uncertainty. The green line shows sea level change as measured by satel-lite. The purple shaded area represents the range of model projections for a medium growth emissions scenario (IPCC SRES A1B). For reference 100mm is about 4 inches. Source: IPCC (2007)

The Kyoto Protocol (including the Clean Development Mechanism) was adopted in 1997 and came into force in February 2005. As a result of the Kyoto Protocol, a few countries that had ratified the Protocol developed their own emission reductions frameworks. Europe took the lead and created the European Union Emis-sions Trading Scheme (The EU ETS) in 2005.

Today, the European Union Emissions Trading Scheme covers 15,000 polluting installations in Europe across the eight heavy industries. These industries account for approximately 60% of Europe’s emissions. Each one of these installations must monitor and verify its emissions every year and retire an equal number of Carbon Permits (EUAs – European Union Allowances) and/or EU ETS CER to those emissions. As a conse-quence, each year, the installations’ emissions are re-duced.

In addition to the utilization of emissions market to re-duce emissions, governments also laid down legisla-tion to promote the development of renewable energy in line with the EU Directive of 20% of energy genera-tion achieved through renewable means by 202017.

http://www.ipcc.ch/publications_and_data/ar4/wg1/en/faq-5-1-figure-1.html

http://ec.europa.eu/clima/policies/package/index_en.htm

18 Please see Letter of Advanced Assurance of SEIS from HMRC in addendum section of document.19 http://unfccc.int/kyoto_protocol/mechanisms/clean_development_mechanism/items/2718.php

Project NameAnnual

Emission Reductions

Initial Crediting

period

Emissions Reductions

Initial Crediting Period

Total Emissions

ReductionsStatus

Municipal Solid waste based Composting at Kolhapur, Maharashtra

30430 7 213010 639030OPERATIONAL &

REGISTERED

Anning River wa’nao Hydropower Station in Xichang City Liangshan prefecture

116684 10 1166840 1166840OPERATIONAL &

REGISTERED

pengshui County Xiamakou Hydropower project 35894 7 251258 753774 UNSUBMITTED

Kuanping 1st Level and Kuanping 2nd Level Bundle Small Hydropower project

11246 7 78722 236166OPERATIONAL &

REGISTERED

Fang County wafangping 2nd Level Hydropower project 56179 7 393253 1179759

OPERATIONAL & REGISTERED

Yulong County Gezihe 1st Level and Gezihe 2nd Level Bundle Hydropoewr project

40647 7 284529 853587OPERATIONAL &

REGISTERED

Yongping County Dawantang 2nd Level Hydropower project 22697 7 158879 476637


Yongping County Dawantang 1st Level Hydropower project 63116 7 441812 1325436


Yunnan Yongde County Dedanghe 3rd Cascade Hydropower project

48463 7 339241 1017723OPERATIONAL &

REGISTERED

Yunnan Yongde County Manglinghe 2nd and 3rd Cascade Bundled Small Hydropower project

35130 7 245910 737730OPERATIONAL &

REGISTERED

Yunnan Yongde County Manghaihe 6th and 7th Cascade Bundled Small Hydropower project

33966 7 237762 713286OPERATIONAL &

REGISTERED

Taizhou Municipal Solid waste power Generation 104217 7 729519 2188557


Shantou Municipal Solid waste power Generation 92087 10 920870 920870


jinshan Municipal Solid waste power Generation 98129 10 981290 981290 UNSUBMITTED

Guangxi jinyuan Methane Recovery project 197,172 10 1971720 1971720


Guangxi Heng County Methane Recovery project 98,812 10 988120 988120


Rural Eco-energy project of Henan Hengyou Husbandry Development Co., Ltd

166,546 7 1165822 3497466OPERATIONAL &

REGISTERED

Sichuan Da County jiujietan Hydropower project 131,078 7 917546 6422822


Xingjiang Aletai Kesaiyi hydropower project 257,532 7 1802724 12619068


Qinghai Xining Calcium Carbide Residue Utilization for Clinker production project

239607 10 2396070 2396070 DEVELOPMENT

Hebei Yuaishi Huaiyang Biomass Coproduction 145227 7 1016589 3049767 DEVELOPMENT

SOLAR 350 Ltd was formed in June 2011 (formerly Carbon 350 Direct Ltd) and is associated via its personnel with CARBON 350 Ltd. CARBON 350 is an Executive Project Developer of Green Energy Projects. Both companies share the same office at 22 Hanover Square, London, W1S 1JP.

CARBON 350 was formed in 2008 and gained Advanced Assurance18 under the Enterprise Investment Scheme from HMRC in January 2009. Subsequently, CARBON 350 raised approximately £78,000 and began trading in 2009. CARBON 350 has brokered and/or Execu-tive Developed 21 Clean Develop-ment Mechanism19 (CDM) Projects. These projects are due to produce approximately 44 Million United Nations Certified Emission Reduc-tions (CERs) between 2012 and 2034 resulting in success fees for Carbon 350 of between €3.9M and €26M dependent on price of the asset on the day of delivery. Although Carbon 350 does not own any of the underlying projects itself, the approximate capex of all projects is in excess of €1 Billion.

Carbon 350 has acted as Broker (1st two projects) and Executive Developer on the following Clean Development Mechanism Projects:

3. SOLAR 350 LTD

http://unfccc.int/kyoto_protocol/mechanisms/clean_development_mechanism/items/2718.php

20Grue og Hornstrup A/S is the full Danish Company name. The English translation is Grue and Hornstrup A/s. In this document, we use G+H to refer to Grue og Hornstrup A/s.

3.1 GRUE OG HORNSTRUP A/S

SOLAR 350 has commissioned Grue og Hornstrup A/S20, a Danish Engineering company to act as Consulting Engineers on all Solar Farms developed by SOLAR 350. Grue og Hornstrup has purchased a 50% shareholding in SOLAR 350 Ltd.

Grue og Hornstrup A/S was one of the first engineering consultancies to provide tailor-made services to the environmental mar-kets. Since 2001 G+H has directly participated in the development and implementation of over 30 green projects (including CDM/JI) and has provided customized Post Implementation engineering and monitoring services to more than 20 operational green projects from Asia to Eastern Europe. Grue + Hornstrup have been active in the Romanian Market since 1998 and have completed a number of industrial scale projects including the following:

Sawdust 2000 is a €13M investment into the establishment of biomass central heating plants and district heating systems in five towns in western Romania. The projects were developed by Grue + Hornstrup during the years from 2000 to 2004. G+H is involved in monitoring the operational quality of the projects.

Geothermal in Oradea & Beus is a €5M investment into the establishment of geothermal based central heating plants and district heating systems in two towns in western Romania. The projects were developed by Grue + Hornstrup during the years from 2002 to 2004. G+H is involved in monitoring the opera-tional quality of the projects.

Solar Power in Holstebro is a €1.9M investment by the Holstebro Municipality in Denmark for grid connected Solar Power installa-tion in public buildings. Grue + Hornstrup are responsible for the concept design, tender, and engineering supervision of the entire project which includes over a dozen different installations.

3.2 SOLAR 350 LTD BOARD

John Nicol Chairman of Solar 350 Ltd

John began his working life as an Electronics Design Engineer. In 1972 he founded Nor-bain Electronics Ltd. The company was taken public via the USM in 1984 and over the next decade became the largest distributor of CCTV in Europe and one of the largest manufacturers in the UK. When John sold his interests in 1996, the company was capi-talised at £60m, was fully listed, employed some 600 people and he was the Chairman with a 30% shareholding.

Since then he has been involved in several start up SME’s in various fields including mining in Zambia. John was a founding member of Carbon 350 in 2008 and has served as Chair-man of Carbon 350 since this date.

douglas A. Marett Non Executive director, Solar 350 Ltd

Douglas is a Partner at Grue + Hornstrup and head of the company’s Energy & Environment Group. He has a decade of experience with project development, design, implementation, and due diligence of renewable energy and environmental projects predominately in Eu-rope and Asia. Douglas has since 2003 worked on the development and implementation of Grue + Hornstrup‘s projects in Romania which include operational biomass, geothermal, and energy efficiency projects.

Douglas has a Msc from the Technical University of Denmark, and a BSc from Clemson University in USA. In 2009 Douglas was awarded the “Young Consultant of the Year” award by the Danish Association of Consulting Engineers, and one of “Top 100 Talents” in Den-mark by Berlingske News Magazine.

Nick dimmock Managing director

Nick has a BA Honours Degree in Business Science and a Masters of Business Administra-tion from CASS Business School. From 1996-2001, Nick worked as a foreign exchange broker and subsequently as a stockbroker, finishing his stock broking career as an institutional equity salesperson at Raymond James in 2002. In 2003, Nick became a founding member of Azure Films Plc which executive produced a number of feature films and TV Series. Nick completed his Executive MBA at Cass Business School London in 2007 and sold out of the film business in 2008.

Post MBA, Nick joined Tullet Prebon‘s emissions trading desk and subsequently founded CARBON 350 LTD in 2008. Carbon 350 has Executive Developed 21 Carbon Abatement Projects with aggregate Capex of over €1 Billion.

3.2 SOLAR 350 LTD BOARD

david burns Non-Executive director, Solar 350 Ltd

David is a Finance professional (MCT, FCCA, DipIoD), with a background in major indus-trial companies which includes twenty years’ experience with Shell, BASF, Basell Poly-olefins and Lyondell Basell Industries. As Project Finance Manager at Shell he designed key parts of the launch of Knightsbridge Tankers on NASDAQ in 1997; other highlights included the creation of the Treasury function as Group Treasurer for the Elenac carve-out from Shell and BASF from 1997 to 2000, and Chief Audit Executive for Basell from 2000 to 2007.

At Solar 350, drawing on his strong background in internal controls for international com-panies, David’s role as Senior Independent Director will be to represent the interests of those equity investors who are not involved in the day-to-day direction of the Company.

Tessa Laws, Non Executive director, Solar 350 Ltd

Tessa is a fully qualified lawyer. After a distinguished career at Rosenblatts, Tessa set up New Laws Legal in 2010. New Laws Legal is a full service law firm authorised and regulated by the Solicitors Regulation Authority.

The practice is run by Tessa Laws as a sole practitioner and gives corporate and commercial legal advice to individuals and businesses. Tessa has been active in the Renewables field since 2008 and also organises the New Energy Awards at the Natural History Museum. Tessa has assisted in the development of 200MW of Wind and 40MW of Solar Power and has worked as Carbon 350’s legal council since 2012.

3.3 ADDITIONAL TEAM MEMBERS

bill Goldie Head of Procurement and Mezzanine finance at Solar 350 Ltd.

In 1994 Bill became the General Manager of Ingram Electronics (part of Beales Hunter Plc) and was responsible for setting up ‘mirror’ manufacturing partners in China. In 1996 he was promoted to Managing Director and in 1998 the company was bought by Stadium Plc.

In 1999 he was promoted to divisional MD running the Power and automotive facilities in the South of England and managing the Asia based supply chain and manufacturing partner-ships. In 2002 he completed his MBA at Canterbury University and left Stadium to set up a company with his previous group Managing Director called Anglo China Strategies Ltd. From 2003 to 2010 his major focus was assisting a UK company called Retronix set up a China facil-ity in Tianjin setting up further facilities in Zhuhai and Shenzhen.

Bill joined Carbon 350 in January 2010, and brought with him his team from China. Bill is responsible for procurement of solar based equipment, mezzanine and equity finance from China.

doru Laslau Commercial Manager, Romania

Having graduated in Marketing and International Economics from the University of Bucharest, Doru started his career with TNT in 2004 within Integrated Logistics. Doru then progressed from TNT to Mobius and then onto Schenker in 2008 gaining stature in each organisation.

Doru joined Carbon 350 in 2009 and has assisted with the development of Carbon 350 Romanian operations since this time. Doru has been working with Solar 350 since September 2012 and is assisting in the operation of the Romanian Businesses and the sales of electricity and green certificates produced by the solar farms.

Please note that we have agreed in principal contract terms with a further individual in regard to assisting with the operations of the Solar Farms in Romania. As we are negotiating the contract and these negotiations are not concluded we cannot disclose identities and background.

3.4 CORPORATE PARTICIPANTS

PROJECT dEVELOPER

SOLAR 350 LTd 22 Hanover Square London. W1S 1JP United Kingdom

CONSuLTING ENGINEERS

GRuE OG HORNSTRuP A/S Nupark 51 – DK-7500 Holstebro Denmark

CORPORATE fINANCIERS

CASSLEY GROuP LTd Level 17, Dashwood House 69 Old Broad Street, London, EC2M 1QS United Kingdom

COMMERCIAL LAWYERS TO THE PROJECT PARTICIPANT

NEW LAWS LEGAL 21 Arlington Street, London. SW1A 1RN, United Kingdom

ACCOuNTANTS TO THE PROJECT PARTICIPANT

POMfREY & CO LTd Unit 42/ The Old Coach House Bexley, DA5 1LU United Kingdom

LAWYERS IN ROMANIA

MuSCAT & ASOCIATII 43 Aviatorilor Blvd., 1st District, Code 011853, Bucharest.Romania

3.5 ORGANISATIONAL STRUCTURE FOR 2013

Below is the organisation structure that we will create in 2013. It is most likely that this structure will be replicated around the world in countries where Solar 350 chooses to develop solar power installations.

SOLAR 350 LtduNITEd KINGdOM

SOLAR 350 PROJECTSPV 1




GRuE OGHORNSTRuP A/S(ENGINEERING)

the UK business with whatever was left being paid to Management as a form of success fee. Thus, Solar 350’s Management objectives would be aligned to the shareholders of the company, in that they would be incentivised to grow the scale and profitability of the business while reducing costs where possible. A breakdown of the 2014 G&A fee (15% of operating profit) can be in Section 9N on page 80.

> In this way, G+H’s objectives would be to carry out the engineering necessary for the business to be-come operational and would be fully aligned with the objectives of the shareholders. Solar 350’s objec-tives would be to grow the scale and profitability of the business which again would be fully aligned with the objectives of the shareholders. Please note, So-lar 350’s management would not have access to the free cash flow generated from the business and thus this should be considered shareholders funds for divi-dends or expansion of the business.

> In addition to the operational objectives as detailed above, due to the restrictions on payments of both Solar 350’s management and G+H, both stakehold-ers objectives would be fully aligned with sharehold-ers objectives in terms of the potential generation of capital gains which may be available from selling individual projects after they are operational and es-tablished.

3.6 STAKEHOLDERS & STAKEHOLDERS AGREEMENTS

G+H originally approached Carbon 350 in regard to Solar Power generation in Romania in May 2012. Both compa-nies then agreed via a Memorandum of Understanding to develop the business through a specific Special Pur-pose Vehicle. This was created from a dormant company that had never traded or become operational, namely Carbon 350 Direct Ltd. A name change then occurred and Carbon 350 Direct became Solar 350 Ltd.

The full details of the Memorandum of Understanding can be seen in the addendum section (9F). However, key clauses were as follows:

> Solar 350’s management and G+H would own 50% of the business each pre outside investment.

> G+H would charge fees in accordance with the stan-dard agreement from the International Federation of Consulting Engineers (FIDIC), but would not charge fees until the company had funds available.

> Solar 350 Management would not take salaries from the business (with the exception of David Burns, who would act as a Senior Independent Non Execu-tive Director specifically representing the rights of outside shareholders). Instead, Solar 350’s Manage-ment would levy a 15% charge against operational profit of the business (this would become known as the the General and Administrative (G&A) Expense). This charge would cover all operational aspects of

3.7 TIMELINE

Week No Week starting Action

1 01/04/2013 Finalise EIS and Institutional Information Memorandum.

2 08/04/2013 Source Projects, Source Debt Finance and Institutional Equity




6 06/05/2013 Finalise Institutional Equity




10 03/06/2013 Order Equipment




14 01/07/2013 Build: Build may occur on multiple sites through multiple contractors.

















31 28/10/2013 Connect to Grid




35 25/11/2013 Gain Final Licenses




39 23/12/2013 Sell Electricity and Green Certificates

40 30/12/2013 Sell Electricity and Green Certificates

21https://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=4&cad=rja&sqi=2&ved=0CEUQFjAD&url=http%3A%2F%2Fbnef.com%2FDownload%2Fpressreleases%2F134%2Fpdffile%2F&ei=AO0sUdrMIcex0AXU8YC4BA&usg=AFQjCNGXreTMmH4hAGNOdcu05cuJdaaNrw&sig2=5I_OVUQR-L-r94P1ANAtvg22http://www.bloomberg.com/news/2011-11-16/clean-energy-investment-may-double-to-395-billion-by-2020.html

As the global economies grow and energy demands increase, the existing dominance of fossil fuels in the energy generation sector is becoming increasingly un-sustainable. In addition, there has been a growing con-sensus that the reduction of carbon emissions is vital to avoid the risk of climate change.

These factors have brought about significant political momentum to encourage energy generation from re-newable sources, presenting an opportunity for compa-nies and investors to participate in the emerging ‘green economy’. This is anticipated to show rapid growth as the world shifts to new models of energy generation.

A commitment to support the shift to renewable ener-gy has been made by the majority of OECD countries. The form of regulatory and policy support varies from measures such as caps on industrial emissions to price support mechanisms to stimulate capital investment in renewable energy infrastructure. Early adopters of price support mechanisms such as Germany and Spain have been followed more widely by OECD countries with the UK introducing a renewable obligation regime in 2002 and a FiT (Feed In Tariff) regime in 2010.

Such price support mechanisms were designed to build capacity in the renewable energy sector in the relevant

4.1 SOLAR PHOTOVOLTAIC TECHNOLOGY

Solar Photovoltaic is a method of converting the power of solar radiation into electrical power using semi-conducting materials such as crystalline silicon. These semi-conductors are typically arranged into cells which are assembled into panels to protect cells from the elements. The capacity of Solar PV technol-ogy is usually referred to in Watts-Peak (Wp), which is the maximum output of solar panels. For larger in-stallations the terms kilo Watts-Peak (kWp) or mega Watts-Peak (MWp) are used.

A series of linked panels mounted on the ground or on a roof, make up the solar installation. The panels produce direct current electricity and so an inverter is connected to the system to convert the power com-ing from the panels into alternating current power which can then be utilized by the Grid.

Solar PV technology is well developed, long lasting and comes with high performance level guarantees. Opera-tional risk is relatively low as there are few moving parts.

market and they were intended to be incrementally re-duced as costs in the supply chain reduced such that Renewable Energy Projects required less regulatory price support to compete with traditional electricity generation.

The UK price support regimes, like Germany and other OECD price support regimes, have been successful in stimulating capacity growth in the renewable energy sector and the UK has been able to reduce the level of price support (particularly the high initial level of FiT for certain technologies). However, other OECD countries that were not able to mobilize capital at the rate the UK was still offer very significant subsidies.

Global investment in clean energy grew to $243 billion in 2010 – over a 30% increase from 2009 levels of $186 billion21. Significant further investment in renewable en-ergy infrastructure is required, however, to deliver the optimum mix of global energy supply to reduce the de-pendence on fossil fuel and achieve a more affordable and secure distribution of energy.

It is forecast that the total value of renewable energy proj-ects across the globe could reach $395 billion by 202022, with Europe remaining as one of the biggest markets for money spent on renewable energy projects for the next three years.

4. THE RENEWABLE ENERGY MARKET

https://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=4&cad=rja&sqi=2&ved=0CEUQFjAD&url=http%3A%2F%2Fbnef.com%2FDownload%2Fpressreleases%2F134%2Fpdffile%2F&ei=AO0sUdrMIcex0AXU8YC4BA&usg=AFQjCNGXreTMmH4hAGNOdcu05cuJdaaNrw&sig2=5I_OVUQR-L-r94P1ANAtvg

https://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=4&cad=rja&sqi=2&ved=0CEUQFjAD&url=http%3A%2F%2Fbnef.com%2FDownload%2Fpressreleases%2F134%2Fpdffile%2F&ei=AO0sUdrMIcex0AXU8YC4BA&usg=AFQjCNGXreTMmH4hAGNOdcu05cuJdaaNrw&sig2=5I_OVUQR-L-r94P1ANAtvg

http://www.bloomberg.com/news/2011-11-16/clean-energy-investment-may-double-to-395-billion-by-2020.html

4.2 SOLAR DESIGN PROVIDED BY GRUE AND HORNSTRUP A/S

Multi- Panel

Systems:

Central Inverter Concept

Ensured Access & Security

2 – 3 layer mounted

Multiple 1000k Units

Viable multi access

roads

Galvanised Steel Structure

Lower electricity

losses

Access maintenance

lanes

Sigma Post of Ballast

Mount

Better maintenance

solution

Perimeter security fencing

Single grid

connection

24 Hour CCTV

security

SOLAR 350 is acquiring Solar Power Projects in the following stages of Development.

> Late Stage Projects which are “shovel ready” with all licence and

constriction permits, including grid connection rights and off-take agreement Certificate/FiT agreements.

> Medium Stage Project with land rights, initial engineering, have started the

licence and constriction permit applications.

> Early Stage Project with only land rights, but close to viable grid

connection points.

SOLAR 350 will utilise G+H’s “Centralised Design Concepts” to develop the sites through:

Construction Format

4.3 SOLAR PROJECT DUE DILIGENCE

All commercial due diligence on potential project sites is being carried out by G+H.

> G+H has a 15 year history of performing Due Diligence and more in-depth feasibility studies worldwide.

> Typical clients are governments, energy companies, financial institutions, industry... (exp. Danish Energy Agency, Deutsche Bank, NEFCO, Vattenfall etc).

> Level 1 - To evaluate the general project potential and determine whether the project meets the basic needs/demands of the client (a screening step).

> Level 2 - To evaluate the project from a technology and output point of view, and as-sess any evident counter party or regulation problems. Thus the basis for deciding on and preparing offers or decisions to proceed with initial agreements.

> Level 3 - To ensure that the client knows as much about the project and counterpart as possible. To determine in detail the technical and output quality of the project, and full evaluation of the counterparty and reputational risk, plus legal ownership and stages of projects under regulations.

G+H carries out due diligence on projects every year. The following represents due dili-gence performed by G+H over the last 10 years.

Project Type Level 1 Level 2 Level 3

Biogas-Fugitive (CH4) Abatement 20+ 20+ 5+

Biogas to Energy 15+ 15+ 10+

Biomass to Energy 15+ 15+ 10+

Solar Power 20+ 20+ 10+

Energy Efficiency in Cement Industry 5+ 5+ 2

Coal Bed Methane to Power 2 1 1

Energy Efficiency in Power Generation 7 7 4

Energy Efficiency Other Industries 5+ 5+ 4

Hydro Power (<20MW) 5+ 5+ 2

Hydro Power (>20MW) 5+ 5+ 0

Landfill Gas Abatement 20+ 15+ 10+

Industrial Emissions Abatement 40+ 20+ 20+

Wind Power 20+ 20+ 3

Geothermal Energy 10+ 10+ 2

23 Please note: additional projects under consideration and project budgets are listed in Sections 9H and 9K of this document.

4.4 SOLAR PROJECTS UNDERGOING DUE DILIGENCE23

2.1 MW Solar Project

> 2.10 MWp PV power installation

> 2,215 MWh generation per year

> 4.0 ha land

> Connection point to 20 kVA step-up station (2.5 km)

> Estimated time for commissioning = 10-11 months

Completed Next Steps

Authentication capabilities for connecting to the PV Plant

X

Ownership of land X (25%) X (75%)

Engineering Design X

Certicate de Urbanism X

CEZ Notice and request for reservation - AA

X

Study of connectivity and temporary authorization– ATR

X

Removing the land from agricultural land (urban)

X

Planning permission (PUZ) & Building permits

X

Pay ATR Fee X

Implementation of PV Plant X

License for electricity production RES and Qualification Certificate - ANRE

X

Registration of seller of elec and green certificates - OPCOM

X

4.4 SOLAR PROJECTS UNDERGOING DUE DILIGENCE23




> 2.8 ha land

> Connection point to 20 kVA step-up station

> Estimated time for commissioning = Operational now



X

Ownership of land X




X


X


X


X

Pay ATR Fee X



X


X




> 4.5 ha land




Authentication capabilities for

connecting to the PV Plant

X

Ownership of land X



CEZ Notice and request for reservation

- AA

X

Study of connectivity and temporary

authorization– ATR

X

Removing the land from agricultural

land (urban)

X

Planning permission (PUZ)

& Building permits

X

Pay ATR Fee X


License for electricity production RES

and Qualification Certificate - ANRE

X

Registration of seller of elec and green

certificates - OPCOM

X

4.4 SOLAR PROJECTS UNDERGOING DUE DILIGENCE (Cont.)

4.4 SOLAR PROJECTS UNDERGOING DUE DILIGENCE (Cont.)

4 MW Solar Project



> 4.5 ha land





X

Ownership of land X




X


X


X


X

Pay ATR Fee X



X


X

5. KEY PERFORMANCE INDICATORS24

Within this section we examine the ingredients of the key performance indicators of Solar Power as de-fined below with specific reference to Romania.

These are defined by way of a schematic right.

High Electricy PriceSignificant subsidy

available and stable sovereign credit rating

Existing energy generation is highly carbon intensive

Low land and labour costs relative to other

performance indicators

High levels of Solar irradiation

24Information within this section is sourced from Grue and Hornstrup A/s White Paper – Un-derstanding Solar Power Investments in Romania. This can be found at http://www.g-h.dk/files/manager/nyheder/120904_12860_understanding%20solar%20power%20investments%20in%20romania.pdfIn turn, their sources are made up of the following: Musat & Asociatii, ”Energy” Chapter 23 www.opcom.ro “Company” ANRE “The Energy Sector in Romania, Present and Future” April 2012 Total gross electricity generation - Eurostat ANRE ”Report on Results of Monitoring the Romanian Electricity Market December 2011” Renewable energy for final energy consumption - Eurostat “Energy Road Map 2050”, COM(2011) 885 Final

ANRE “The Energy Sector in Romania, Present and Future” April 2012 ANRE “The Energy Sector in Romania, Present and Future” April 2012 www.opcom.ro “Green Certificates issued…” July 2012 Emergency Ordinance no. 88/2011 Green Certificates issued, traded on centralized market and on bilateral market” 29th August 2012, OPCOMTranselectria “Certificate verzi pentru luna 7 anul 2012” 29.08.2012“Photovoltaic Barometer” April 2010 & April 2012 Transelectria “Certificate verzi pentru luna 7 anul 2012” 29.08.2012“South-East European PV Market Review” Sep 2012 see-industry.com and IBCOENERG “Planned Project in Romania Solar PV Market” May 2012 “Doing Business” The World Bank and International Finance Corporation, 2012

5.1. SOLAR IRRADIATION

Because of its position on the south-eastern portion of the European continent, Romania has a climate which ranges from temperate to continental. Climatic conditions are somewhat modified by the country’s varied topography.

The Carpathians serve as a barrier to Atlantic air masses, limiting their oceanic influences to the west and centre of the country (Transilvania, Banat and Maramureş), which have milder winters and heavier rainfalls as a result.

The mountains also block the continental influences of the vast plain to the north in the Ukraine, which results in frosty winters and less rain to the south and southeast. In the extreme southeast, Black Sea influences offer a milder, maritime climate.

The solar power generation potential in Romania is one of the higher levels in Europe. The average daily solar power generation potential is between 3.2 and 3.4 kWh/

As evident from the above, Romania receives relative high levels of Solar Irradiation, with the southern states benefitting the most.

http://www.g-h.dk/files/manager/nyheder/120904_12860_understanding%20solar%20power%20investments%20in%20romania.pdf



25 http://ec.europa.eu/clima/policies/package/index_en.htm

5.1 SOLAR IRRADIATION (Cont.)

kWp in Romania depending on location, in com-parison to London, UK with 3.0 kWh/kWp and Co-penhagen, Denmark with 2.8 kWh/kWp.

The radiation reaching the earth’s surface can be represented in a number of different ways. Global Horizontal Irradiance (GHI) is the total amount of shortwave radiation received from above by a surface horizontal to the ground. This value is of particular interest to photovoltaic installations and includes both Direct Normal Irradiance (DNI) and Diffuse Horizontal Irradiance (DIF).

DNI is solar radiation that comes in a straight line from the direction of the sun at its current posi-tion in the sky. DIF is solar radiation that does not arrive on a direct path from the sun, but has been scattered by molecules and particles in the atmosphere and comes equally from all direc-tions.

On a clear day, most of the solar radiation received by a horizontal surface will be DNI, while on a cloudy day most will be DIF.

For the purposes of a Solar Farm, average annual sunshine dictates the amount of energy that can be generated from solar photo voltaic panels.

The previous chart show the average annual amount of Solar Irradiation in kWh/m2 reaching Romania.

“The European Union’s Climate and Energy” package is a set of binding legislation which aims to ensure the Eu-ropean Union meets its ambitious climate and energy targets for 2020. These targets, known as the “20-20-20” targets, set three key objectives for 2020:

> A 20% reduction in EU greenhouse gas emissions from 1990 levels;

> Raising the share of EU energy consumption pro-duced from renewable resources to 20%;

> A 20% improvement in the EU’s energy efficiency.

A commitment to support the shift to renewable energy has now been made by the majority of OECD countries. The form of regulatory and policy support varies from measures such as caps on industrial emissions to price support mechanisms to stimulate capital investment in renewable energy infrastructure”25.

Point 2 within this directive has forced European States to develop market based mechanisms to ensure they achieve this target.

Within the United Kingdom, the government implement-ed Feed In Tariffs (which it subsequently withdrew for Solar and Renewable Energy Certificates (REC). These can be traded between renewable energy providers and incumbent energy providers, such that a coal based Farm can through purchasing the appropriate amount of renewable energy certificates and subsequently sub-

5.2 RENEWABLE ENERGY SUBSIDIES

http://ec.europa.eu/clima/policies/package/index_en.htm

26The range is dependent on if the small-hydro plant is new (receiving 15 years and 3 GCs) or its existing age (receiving as low as 3 years and 0.5 GCs).27For new wind power receiving 2 GCs until 2017 and 1 GC from 2018 28New power generation, with +1 GC for high efficiency cogeneration

5.2 RENEWABLE ENERGY SUBSIDIES

mitting them to their energy regulator can be seen, by proxy to have produced 20% of its energy through re-newable means.

Each European State has developed its own Renewable Energy Strategy.

5.21 Romanian Green Certificate Scheme

The Green Certificate (“GC”) program in Romania was established under Law 220/2008, with amendments in 2010 and 2011, and endorsed by the European Com-mission in July 2011. Law 220/2008 took full legal effect in Romania in October 2011. Law 220/2008 applies to specific project based renewable energy installations offering GCs for a defined time span, and for the follow-ing renewable energy technologies.

New beneficiaries may enter the GC scheme until the 31st December 2016, and this is currently interpreted as specific installations generating electric power by the date with all approvals in place.

The revised Law 220/2008 sets a mandatory quota allo-cation starting at 10% in 2011 and up to 20% in 2020, with an approximate 1% raise annually. This quota is based on the GCs issued per MWh of final consumption of energy in a given year. ANRE estimates the actual percentage to be 11% in 2012, This approximately corresponds with cur-rently available information issued by OPCOM.

A driving legal force of Law 220/2008 is that each sup-plier as well as each producer which has the obligation to purchase GCs, must meet their portion of the manda-tory national quota for purchasing GCs, otherwise face a fine of 110 EURs per non-purchased GC. ANRE is the authority who regulates the number of GCs each sup-plier and producer must purchase each year.

The GC allocation may be adjusted by ANRE in individual cases where they receive investment aid, or in the broad case that producers using a technology are achieving a higher IRR exceeding 10% of the benchmark set by ANRE and taking effect at the start of each year.

Type GC / MWh Time (yrs)

Small Hydro (<10MW)26 0.5 - 3 3 - 15

Wind Energy27 1 - 2 15

Biomass28 2 – 3 (+1) 15

Biogas & Landfill gas 1 15

Geothermal 2 15

Solar 6 15

Table 2: Green Certificate allocation scheme and time frame by project type

29 Point Carbon: http://www.pointcarbon.com/30 We have rounded 950 grams CO2 to 1000, due to generally inefficient production of electricity in Romania.

5.23 The Value of Green Certificates

OPCOM effectively administers the centralized (clear-ing exchange) and bilateral trading of GCs. Under Law 220/2008 the GCs can fluctuate under a trading market mechanism with a legally set price band of 27 EUR/GC (min.) and 55 EUR/GC (max.).

The price is indexed on an annual basis based on infla-tion within EuroStat. The GC trading market is for the time being restricted to Romanian suppliers and produc-ers, however Law 220/2008 allows for an opened door of trading within a future harmonized inter-EU Green Certificate system. Up to 80% of GCs trade on a bilateral basis, with the remaining traded on the centralized mar-ket at OPCOM.

5.24 The Volatility of Green Certificates

There is little risk that Law 220/2008 will be revoked or revised in the future, as it is also endorsed by the Euro-

pean Commission as a part of Romania’s obligation to meet EU and national renewable energy goals. Should the current Law stay as is, there is foreseen to be a ma-jor swing in supply (downward) in 2018 when GCs from wind power are cut in half. GCs from wind power cur-rently make up 74% of the supply. Future supply of Green Certificates will thus depend on new capacity entering the Green Certificate Scheme.

The wholesale price of electricity in Romania fluctuates based on base, peak, and off-peak loads.

Trading in 2012 (Jan. to Sep.) via OPCOM indicates that daily base load prices (hrs 1-24) ranged from 45 to 73 EURs/MWh, with peak load (hrs 7-22) prices ranging from 60 to 82 EURs/MWh.

As Romania’s power markets are relatively reliant on coal power generation, due to its abundance in Romania, it is anticipated that Romania’s electricity price will be es-pecially affected by any increase in the carbon price charged as part of the European Unions Emissions Trad-ing Scheme (The EU ETS).

This price per permit to pollute sits at circa €529 per ton of CO2 emitted. This offers little incentive for energy gen-erators to reduce their emissions. It is anticipated that for a fully effective market, prices should be closer to €50 per ton.

Based on Coal Fired PowerStations producing 95030

Grams of CO2 per KWh and thus 0.95 tons CO2 per MWh, any change in the carbon price can essentially be added directly to the existing electricity price. Thus a Carbon Price of €50 per ton would increase the electric-ity price to €100MWh (€55 existing electricity price+50 new carbon price-5 existing carbon price).

5.3 ELECTRICITY PRICES

5.2 RENEWABLE ENERGY SUBSIDIES (Cont.)

Figure 2: Electricity Price Romania (OPCOM 2012)

Chart Detailing Price and Volume of Green Certificates during 2011

Point Carbon: http://www.pointcarbon.com/

Electricity in Romania is primarily generated from ther-mal power plants (coal, natural gas, and oil), with the balance of production from hydroelectric facilities and a recently commissioned nuclear power plant.

Romania began to deregulate its power sector in 1998 from a state owned system; regulations in the early years were followed by substantial changes in 2006 and 2007. The current liberalized market is under primary regulation by the National Authority of Energy Regula-tion (“ANRE”) and the National Authority for Regulation of Public Community Services (“ANRSC”).

In 2000 the electricity administrator Romanian Power Market Operator (“OPCOM”) was established and cur-

5.4 CURRENT ENERGY GENERATION

rently ensures the impartial viability of wholesale trading within the Romanian market. Romania has a generation capacity exceeding 20 GW, and a gross electricity gen-eration of 60.6 TWh (Tera Watt Hour) in 2010. In 2011 the amount of renewable electricity dispatched to the na-tional grid was 27.9%.

5.41 Romanian National Renewable Energy Strategy

In the EU Renewables Directive (2009/28/EC) Romania has pledged a target of 24% renewable energy for final energy consumption. In 2010 Romania achieved 23.4%.

At the national level the Romanian energy strategy for the period of 2007-2020 (and revised to 2035), as ap-proved by the Government Decision No 1069/2007, establishes the level of national targets concerning the shares of electricity generated from renewable energy sources in the final consumption of electricity at 35% (2015) and 38% (2020). Romania’s national targets corre-spond to the long term strategy of the EU Commission’s Energy Roadmap 2050 which reflects a renewable en-ergy share of 55-75% in gross final energy consumption, and to 97% in electricity consumption.

When addressing the Romanian national target for re-newable energy sources in final consumption for 2020 and the actual renewable energy generation in 2011, Ro-mania will need to increase such renewable energy gen-eration by 35% by the end of 2020.

The Romanian national strategy has anticipated the fol-lowing levels of new installed power generation capacity for renewable energy as indicated below.

Figure 1: Electricity Delivered by Generators by source – 2011

5.4 CURRENT ENERGY GENERATION

GW 2010 2015 2020 2025 2030 2035

Wind 0.56 3.20 4.00 4.50 4.80 5.00

biomass 0 0.34 0.46 0.52 0.56 0.58

Solar 0 0.15 0.26 0.32 0.40 0.49

Hydro 6.46 6.78 7.05 7.32 7.59 7.86

Table 1: RE-Power Capacity (National Strategy)

This need and perspective to increase the share of renewable energy generated in Romania is one of the main drivers of the Romanian Green Certificate regulation.

5.5 LAND AND LABOUR COSTS

While Romania is currently growing at 2.5% per an-num in terms of GDP, has a sovereign credit rating of BBB+ Stable and unemployment is 6.7% and falling, labour costs are still very low relative to the rest of Europe.

Land prices however, have been increasing of late ac-cording to local reports.

6. MITIGATION OF SOLAR RISKS31

There are several identified risks related to investing in so-lar power projects in Romania, and the majority of these risks can be mitigated as follows:

> According to “Doing Business” Romania ranks in the top 35% of countries in starting a new business, and the top 40% in ease of business. Business risk can be mitigated by working with companies with a long history in the Romanian renewable energy sector who operate at the level of international standards.

> Monitoring and Reporting under the Green Certificate Scheme is comprehensive and on a monthly basis, thus it is important to have professional and experi-enced local management and oversight.

> There is a deadline of participating in the GC scheme by the end of 2016, therefore it is recommended that any solar project investment start by the end of 2015 to allow for permitting and project implementation. ADD: Target for 2013 is that funds are ready for deployment by mid June 2013.

> ANRE may adjust GC issuance impacting investor re-turns in the future, but will not remove an installation without cause. A positive note is that in 2012 ANRE has not adjusted the GC allocation for solar power. In the case of any future adjustment then the expected impact on investment is an IRR of no lower than 12.7%.

> Currently the GC trading market is still gaining traction, and ANRE’s regulation of GC quota obligations of power producers is also developing. This means that the next year or two may have high volatility in trading volume.

31Information within this section is sourced from Grue and Hornstrup A/s White Paper – Understanding Solar Power Investments in Romania. This can be found at http://www.g-h.dk/files/manager/nyheder/120904_12860_understanding%20solar%20power%20investments%20in%20romania.pdf


7. FINANCIALS

The Solar Farms will produce two saleable assets:

> Electricity > Green Certificates

We anticipate selling the electricity on a weekly basis to ensure we maximise prices in a market where we believe risk is to the upside.

In regard to Green Certificates, we anticipate selling these by forward contract for the whole 15 years, subject to being able to agree reasonably commercial terms.

Solar 350’s is currently owned by Solar 350’s Manage-ment and Board (50.34%), Grue og Hornstrup A/S (46.83%) (collectively, the “operators”) and SEIS 1 Inves-tors (2.83%).

Solar 350’s management and Grue og Hornstrup A/S have invested approximately £180,000 in the business to achieve the current level of development across all projects. In addition, SEIS 1 Investors have invested ap-proximately £43,600 in the business. Our target is now to increase equity involvement by bringing in new equity investors (the “investors”).

Within this document as per the details on the front cover, Solar 350 are offering 350,000 shares priced at

7.1 VALUATION

32Please note: within this document we have assumed the GBP/EURO Currency Rate to be 1.16. Thus, £12.39, (our target average share price) is shown in the financial illustration at €14.38. This is £12.39*1.16 = €14.38.33Shovel Ready is a term used to define when projects are actually ready to start building.

34Valuing Solar Farm Developers, Deloitte: http://oportunidades.deloitte.cl/marketing/Web/Energia-solar.pdf35Warren Buffett to build world’s largest solar power project: http://www.telegraph.co.uk/finance/newsbysector/energy/9777016/Warren-Buffett-to-build-worlds-largest-solar-ener-gy-project.html

Please note:

> The financial illustration and cash flow detailed in the following sections does not take into account additional capacity that can be added through utiliz-ing the free cash flows generated by the business.

> Grue og Hornstrup A/S have built in 8.5% of project cost contingencies into the project development budget.

> All figures within the Sections 7 and 8 are denomi-nated in Euros.

> Although actual amounts may differ in terms of the financial illustration and actual cash flows of the busi-ness in practice the Directors believe the financial il-lustration and cash flow as detailed in this section are representative of the business given current legislation.

7.1 VALUATION (Cont.)

£14 for a total of £4.9M. In addition, Solar 350 is raising a further £2.8M of equity through other sources for a combined capex deployed equity raise of £7.5M. When combined with debt at a ratio of 75/25 this would then provide the Solar 350 with project development capabili-ties to the value of £30M.

The value of Solar 350 once 20MW is installed is esti-mated to be circa £36 Million based on a discount rate of 5%. Even though our current cost of capital is 8%, we anticipate issuing a Solar 350 Bond in the near future to refinance all the projects at a lower rate and add ad-ditional capacity. The interest rate on this bond is antici-pated to be 5%.

Deloitte Touche Tohmatsu Limited, within their report of August 2011; Valuing Solar Farm Developers34, places an average metric on Solar Farm Developers of Enterprise Value (millions) / MW of 4.2 times. This means that they value each MW of installed capacity at €4.2 Million or circa £3.6 Million. Based on this metric and 20MW of in-stalled capacity, the Enterprise Value of Solar 350 would be 20*3.6 Million = £72 Million.

http://http://oportunidades.deloitte.cl/marketing/Web/Energia-solar.pdf

http://http://oportunidades.deloitte.cl/marketing/Web/Energia-solar.pdf

http://http://www.telegraph.co.uk/finance/newsbysector/energy/9777016/Warren-Buffett-to-build-worlds-largest-solar-energy-project.html



7.2 FINANCIAL ILLUSTRATION

The Solar farms:

Area (m2) 400,000

Location ROMANIA

Capacity in kW 20,000

Peak sun hours/day (average) 3.40

Power System Losses 15%

Electricity Generation kWh/yr 21,097,000

Capex & Maintanence:

Investment Costs in Euro/kW 1,750

Total investment 35,000,000

O & M Costs in Euro/MW 60,000

Electricity & Subsidy Prices:

Electricity sales price in Euro/MW 55

Assumed Annual increase 0.00%

Green Certificate Per MW 6

Green Certificate Sales Price in Euro/MW 55

Assumed Annual Increase 0.00%

Shares & Ownership:

Solar 350 Management 20.00%

Grue & Hornstrup A/S 20.00%

Investors 60.00%

Check 100.00%

financed Via:

Equity 25.00%

Debt Funding 75.00%

Summary:

Equity 8,750,000

Loan 26,250,000

Capex 35,000,000

Loan Interest 8%

Loan payback 10

Loan Repayments PA 3,912,024

Share Valuation Entry:

Initial Funding 9,187,500

Float Pre Funding 400,000

Share Float Post Funding 1,000,000

Of which: Investor Shares 600,000

Price Per Share Euro 15.31

Anticipated Returns:

Equity IRR 28.05%

Total Cash Returned to Investors 23,054,132

NPV of Investor Cashflows Received 11,704,707

Undiscounted Return on Investment 150.93%

Discounted Return on Investment 27.40%

The table below is a financial illustration of the anticipated operations of Solar 350 from the development of 20MW of solar capacity in 2013. Please note, all figures in this section are in Euros.

20 MW SOLAR CAPACITY

7.2 FINANCIAL ILLUSTRATION

Guide Notes per Section:

The Solar Farms: Area relates to land required. Capacity detailed in Kilo Watts: kilowatts*peak sun hours, less power system losses = elec-tricity generation capacity.

Capex & Maintenance: Capital Expenditure; how much the project costs are to build per kw. Multiply this with the capacity on this project as detailed in Solar Farms line 3, and this is overall project cost. O&M is ongoing operations, security and maintenance of the farms.

Electricity and Subsidy: These are the outputs; electricity and green certificates.

Shares and Ownership: Details of shareholdings post equity raise which would include both SEIS, EIS and subsequent institutional funding.

Financed Via: Equity or Debt; what are the percentages of both utilized in the company.

Summary: Equity plus Debt = Capex. Capex figure matches our Total Investment in The Capex and Maintenance Section. Then loan interest and a calculation for complete payback after 10 years.

Share Valuation Entry: This takes the initial funding required plus cost of equity, divides this figure by new shares for investors and gives us a price per share in Euros. Please note, this figure in Euros is the average price we need to attain for complete financing of 20MW.

Anticipated Returns: Equity IRR is the internal rate of return achieved by the equity portion of the project. Total Cash Returned to Investors is the sum of all cash flows received by investors, based on company valuation and repurchase of investors equity over 10 years from year 3 onwards.. NPV of Investor Cash Flows received discounts cash flows received by investor to give a value today. Undiscounted Return on Investment, details total returns to investors. Discounted Return on In-vestment uses the discounted value of investor’s cash flow to create a Return on Investment today.

7.3 SOLAR 350 CASHFLOW ILLUSTRATION

The table below is a cash flow illustration of operations of Solar 350 from the development of Solar Farms in 2013. Debt finance is not detailed though repayment of debt is, and is based on the repayment of capital and interest over 10 years.

Year Electricity Production kWh

Electricity & Green Certificate

Revenue

build, Loan Repayment & Maintenance

Operating Cash flow*

General & Administrative

Costs (G&A)**

free Cash

flow***

2013 0 0 -8,750,000 -8,750,000 -437,500 -9,187,500

2014 21,097,000 8,122,345 -5,112,024 3,010,321 -451,548 2,558,773

2015 20,886,030 8,041,122 -5,100,024 2,941,097 -441,165 2,499,933

2016 20,677,170 7,960,710 -5,088,144 2,872,566 -430,885 2,441,681

2017 20,470,398 7,881,103 -5,076,383 2,804,720 -420,708 2,384,012

2018 20,265,694 7,802,292 -5,064,739 2,737,553 -410,633 2,326,920

2019 20,063,037 7,724,269 -5,053,212 2,671,057 -400,659 2,270,399

2020 19,862,407 7,647,027 -5,041,800 2,605,226 -390,784 2,214,442

2021 19,663,783 7,570,556 -5,030,502 2,540,054 -381,008 2,159,046

2022 19,467,145 7,494,851 -5,019,318 2,475,533 -371,330 2,104,203

2023 19,272,473 7,419,902 -5,008,245 2,411,657 -361,749 2,049,909

2024 19,079,749 7,345,703 -1,085,258 6,260,445 -939,067 5,321,378

2025 18,888,951 7,272,246 -1,074,406 6,197,840 -929,676 5,268,164

2026 18,700,062 7,199,524 -1,063,662 6,135,862 -920,379 5,215,483

2027 18,513,061 7,127,528 -1,053,025 6,074,503 -911,175 5,163,328

2028 18,327,930 7,056,253 -1,042,495 6,013,758 -902,064 13,861,694

Plus asset value after depreciation (in 2028) 8,750,000

Please note:

a) We have assumed no reinvestment of free cashflows for additional projects.

b) General and Administrative (G&A) Costs set at maximum of: 15.00%

c) Asset value after depreciation based on 20% depreciation per annum.

d) Discount Rate used for Discounted Return on Investment 8%

* Please note: In 2013 only, Operating Cash Flow details the equity capex of the projects

** Please note: In 2013 only, G&A costs stated relate to additional start up costs.

*** Please note: In 2013, Free Cash Flow relates to the equity capex plus start up costs.

Guide Notes per Section

> Electricity production Kwh: is total electricity produced based on the in-stallation detailed on previous page for each year.

> Electricity and Green Certificate Rev-enue: is the total income derived from the quantity of electricity produced multiplied by the output prices as de-tailed in Electricity & Subsidy detailed in the financial illustration.

> Build, Loan Repayment and Mainte-nance: is a deduction from revenue in the previous box.

> Operating Cash Flow: is the revenue less build, repayment and maintenance.

> General and Administrative (G&A) Costs: are the other operating costs of the business, including notably man-agement team salaries and bonuses in the UK as well as legal and professional fees.

> Free Cash Flow: is the free cash flow generated when build, loan, mainte-nance and G&A costs are deducted from the revenues generated from elec-tricity and green certificates.

7.3 SOLAR 350 CASHFLOW ILLUSTRATION

i. Within the financial illustration, we have chosen to illustrate General and Administrative (G&A) costs with a maximum 15% charge against Oper-ating Cash flow. G&A as defined here, includes all costs other than build, interest, loan repayments, and operations of the farms. This will include the costs of managing the company in London, in-cluding fees, commissions and performance-re-lated pay. Detailed budgets inevitably involve as-sumptions for each item. The total will effectively be subsidised by the fact that until the company becomes operational, costs are being born by the operators. The maximum 15% charge is in our view a conservative assessment which allows ample room for contingencies. The Audit and Risk Committee will be charged with scrutinising the management of total G&A cost. The G&A cost in year 1 is 5%.

ii. Within the financial illustration, we have assumed 20MW of installed Solar Power in 2013. The Di-rectors of Solar 350 have analysed all opportuni-ties being presented by Grue and Hornstrup and believe that, subject to financing, this is easily achievable.

iii. Within the financial illustration, we have assumed a investment CAPEX cost of 1,750 €/kw. This figure is intentionally high and accounts for the additional costs that may be encountered from purchasing “semi developed” Solar Farms. “Semi Developed” So-lar Farms is a term used to describe sites that already have most of the required licenses but require fur-ther development before they are “shovel ready”.

iv. Within the financial illustration, we have assumed no increase or decrease in the electricity price from December 2012 levels.

v. Within the financial illustration, we have assumed no increase or decrease in the price of the subsidy; green certificates.

vi. Within the financial illustration we have illustrated the returns to the investor based on the repurchase of 1/10th of investor shares each year for 10 years start-ing in year 3. There are no guarantees this will hap-pen and this is not a predetermined exit, however, the Directors are keen to repurchase investor shares where free cash flow of the business allows it.

vii. We have assumed a discount rate for equity inves-tors of 8%. We believe this is a high value for stable infrastructure projects.

viii. Within the financial illustration, we have assumed the proportion of debt to equity that we will utilize to finance the projects. No specific and detailed ar-rangements for debt or equity funding are currently in place. However, it is the Directors belief that fund-ing in this manner will be available to the company.

ix. Within the financial illustration, we have assumed the interest on the debt to be 8% on a 10 year loan.

x. Within the cash flow forecast, we have not assumed that we are able to carry forward corporation tax losses from the 1st year of operations.

xi. Within the cash flow forecast, we have not assumed that we will reinvest the free cash flow into addition-al capacity or development of additional sites. We can however confirm that the free cash flow will be used to either grow the business or pay dividends or repurchase investor shares. It will not be used to pay salaries or bonuses or other payments in kind.

xii. Within the cash flow forecast, in 2028, we have as-sumed an asset valuation based on depreciation of 20%, but discounted back to today. In reality, we an-ticipate the assets to be worth considerably more than this figure; however it is difficult to foresee what the future value will be as we do not know the electricity price at this time.

7.4 NOTES ON ILLUSTRATION AND CASHFLOW FORECAST

36http://www.hmrc.gov.uk/seedeis/background.htm

8. SEIS TAX RELIEFS36

Solar 350 Ltd has received Advanced Assurance from HMRC in regard to its Status as an SEIS/EIS company. Con-firmation of this can be found in Section 9U of this docu-ment. This provides the following:

> Income Tax Relief: Investors can claim back income tax of 50% of the amount invested up to a maximum of £100,000.

> Capital Gains Tax Relief: Provided the SEIS investment is held for more than three years, any gain on sale is free from capital gains tax.

> Capital Gains Reinvestment Relief (only for tax year 2012/2013): If an investor has an existing capital gains liability and he invests the capital gains in an SEIS

qualifying investment, there will be no capital gains to pay on the original investment (that generated the capital gain in the first place). Of course the investor will still benefit from the Capital Gains Tax Relief from the SEIS as detailed above.

With the potential for 78% tax relief in the first year, (50% income tax, 28% capital gains tax exemption relief on exist-ing tax liabilities) and loss relief for 50% of the investment at investor marginal rate, SEIS investments are designed to be attractive to potential investors. A basic illustration of investor returns incorporating SEIS Reliefs is detailed below:

Please note: The Share Price detailed below (€16.24) is equivalent to £14.00 as detailed on the front cover.

SEIS Investor financial Illustration: All figures detailed in Euros.

Summary:

Capital In -8120.00

Positive Cashflows 25545.38

Gain 17425.38

ROI 214.60%

Please note, the above calculations are based on the investor utilising CGT Exemptions on SEIS.

ALL FIGURES IN EUROS

YearShares

Purchased / Sold

PriceInvest-

ment Cash flows

Income Tax Rebate

CGT Ex-emption

Summary Cash flows

2013 500 16.24 -8120.00 -8120.00

2014 0 4060.00 4060.00

2015 0 2273.60 2273.60

2016 -50 27.51 1375.50 1375.50

2017 -50 29.01 1450.49 1450.49

2018 -50 30.76 1537.88 1537.88

2019 -50 32.81 1640.56 1640.56

2020 -50 35.25 1762.31 1762.31

2021 -50 38.17 1908.26 1908.26

2022 -50 41.71 2085.46 2085.46

2023 -50 46.08 2303.89 2303.89

2024 -50 51.56 2578.20 2578.20

2025 -50 51.38 2569.23 2569.23

http://http://www.hmrc.gov.uk/seedeis/background.htm

37http://www.hmrc.gov.uk/eis/index.htm

8.1. EIS TAX RELIEFS37

Solar 350 Ltd has received Advanced Assurance from HMRC in regard to its Status as an SEIS/EIS company. Confirmation of this can be found in Section 9U of this document. This provides the following:

> Income Tax Relief: 30% income tax relief on the amount invested provided that the shares are held for a minimum of three years. The maximum amount on which investors may obtain income tax relief in any tax year is £1 million.

> Capital Gains Tax: CGT Exemption on capital gains re-alised on the disposal of an EIS investment, provided that the shares have been held for at least three years.

> Capital Gains Tax (CGT) Deferral from gains on other investments: Providing the EIS investment is made in the period beginning 12 months before and ending 3 years after the date of the disposal of the asset which is subject to CGT.

> Loss Relief: In the event of a capital loss on the EIS investment, the loss (less any reliefs already obtained can be set against capital gains of that tax year or a later tax year, or against income of that tax year or the preceding tax year.

> Inheritance Tax (IHT): Exemption providing the shares have been held for at least two years and are held at the time of death.

Summary:

Capital In -8120.00

Positive Cashflows 21647.78

Gain 13527.78

ROI 166.60%

Please note, the above calculations due not model the benefits of Capital Gains Reliefs on entry or exit..

ALL FIGURES IN EUROS

EIS Investor financial Illustration: All figures detailed in Euros.

YearShares

Purchased / Sold

PriceInvestment

Cash flows

Income Tax Rebate

Summary Cash

flows

2013 500 16.24 -8120.00 -8120.00

2014 0 2436.00 2436.00

2015 0 0.00

2016 -50 27.51 1375.50 1375.50

2017 -50 29.01 1450.49 1450.49

2018 -50 30.76 1537.88 1537.88

2019 -50 32.81 1640.56 1640.56

2020 -50 35.25 1762.31 1762.31

2021 -50 38.17 1908.26 1908.26

2022 -50 41.71 2085.46 2085.46

2023 -50 46.08 2303.89 2303.89

2024 -50 51.56 2578.20 2578.20

2025 -50 51.38 2569.23 2569.23

http://http://www.hmrc.gov.uk/eis/index.htm

8.2 FURTHER INFORMATION ON TAX RELIEF

It has recently become apparent to the government and HMRC that individuals were using EIS and SEIS funds solely for the purpose of tax mitigation.

The schemes under scrutiny are characterized by low risk, low return vehicles whose only benefit seems to be the reclamation of individuals tax, financial gain for the structuring company and intermediary and which pro-vide no benefit to the UK economy or government.

Investors considering these types of SEIS and EIS schemes need to be aware that EIS and SEIS were de-signed to encourage investments in riskier companies, offering tax relief to mitigate the higher associated risks. Ultimately, it was anticipated that SEIS and EIS companies would provide more employment within the UK and Eu-

rope and additional tax revenues for the UK government.

In order to counter such tax avoidance, s.178 of the 2007 Act provides that “The relevant shares must be issued for genuine commercial reasons and not as part of a scheme or arrangement the main purpose or one of the main purposes of which is the avoidance of tax.

Clearly, Solar 350 is a fully commercial company, which will trade indefinitely and grow its operations just as Car-bon 350 has. Thus, the tax relief offered, while being a significant incentive does not provide the sole motivation for the investor.

Shares from Private Limited Companies are also eligible for inclusion with Self Invest Pension Plans under HMRC rules.

8.3 SUITABILITY

This opportunity would be suitable for UK taxpaying inves-tors who want direct access to the fast growing renewable energy sector, have a higher tolerance of risk, are looking for a medium term investment and whose personal cir-cumstances allow them to take advantage of the SEIS/EIS reliefs, such that they are able to benefit from the income tax relief and/or defer capital gains. For example:

> An investor who wishes to claim back income tax rebate of 50% (SEIS) / 30% (EIS) of his investment.

> An investor wishing to gain an exemption from a taxable capital gain (SEIS).

> An investor, who wishes all gains to be free from capital gains tax (SEIS/EIS)

> An investor, who wishes his investment to be free from inheritance tax (EIS)

> An investor who is happy to hold their investment for at least 3 years and does not expect an income from the investment over this time.

There are of course other combinations relevant to in-vestor’s individual circumstances.

8.4 CORPORATE GOVERNANCE

All executive directors as well as the majority of non-executive directors are due to receive success fees and commissions based on results as opposed to ba-sic salaries. We believe that this will provide the right basis for results focus.

At the same time, there will be at least one non-execu-tive director who will not take part in any share option or performance-related pay scheme. We believe this

will provide the right basis for corporate governance based on independent scrutiny at board level by the Company’s Audit and Risk Committee.

The overall arrangement will where relevant be in line with best practice guidance applicable to listed com-panies in the UK (currently set out in the Corporate Governance Code published by the FRC), adapted to the unlisted status of Solar 350 Ltd at the present time.

9. ADDENDUM AND SUPPORTING INFORMATION

A. Certificate of Incorporation

CERTIFICATE OF INCORPORATIONOF A

PRIVATE LIMITED COMPANY

Company Number. 7678367

The Registrar of Companies for England and Wales, hereby certifies that

CARBON 350 DIRECT LIMITED

is this day incorporated under the Companies Act 2006 as a private company, that thecompany is limited by shares, and the situation of its registered office is in Englandand Wales.

Given at Companies House, Cardiff, on 22nd June 2011.

The above information was communicated by electronic means and authenticated by theRegistrar of Companies under section 1115 of the Companies Act 2006

1

9. ADDENDUM AND SUPPORTING INFORMATION (Cont.)

B. Certificate of Incorporation of Change of Name

Name Position Hours Value per hour Total Contribution

Nicholas Dimmock Managing Director 960 100 £96,000

William Goldie Procurement Manager 120 100 £12,000

Larry Luo Procurement (China) 40 50 £2,000

Daniel Ken Procurement (China) 20 50 £1,000

Doru Laslau Electricity/GC Sales (RO) 40 50 £2,000

Ric Hallikeri Project Acquisitions (RO) 20 50 £1,000

John Nicol Chairman 60 250 £15,000

David Burns Non Executive Director 60 250 £15,000

Tessa Laws Non Executive Director 40 250 £10,000

Expenses £2,250

£156,250

Name Position Hours Value per hour Total Contribution

Douglas Marett Head of E&E Group 255 107 £21,400

Thomas Bosse Engineer, E&E Group 57 80 £4,560

Lars Grue Managing Director 4 114 £456

Dennis Rasmusen Development Consultant (Romania) 32 40 £1,280

Mihai Brasoveanu Operations Manager (Romania) 40 45 £1,800

Expenses £3,250

£32,746


C. Financial Information on Solar 350 Ltd

Solar 350 is a newly formed company.

As of 5th April, Solar 350 has had physical investment of circa £43,000.

As of 1st March Solar 350 has received “sweat equity” in lieu of shares awarded as detailed below from Solar 350 Management. Thus Solar 350 has paid for this benefit and nothing more is due.

As of 1st March, the following billable contribution has been made by Grue and Hornstrup A/s. Under Solar 350’s MOU with G+H, this amount will be paid when Solar 350 has funds to pay.

Post SEIS, EIS and InstitutionalBill Goldie 10,000 1.00%

Tessa Laws 20,000 2.00%

John Nicol 20,000 2.00%

Nick Dimmock 150,000 15.00%

Grue og Hornstrup A/S 200,000 20.00%

David Burns 15,000 1.50%

SEIS 1 Investors 12,080 1.21%

SEIS 2+3 Investors 10,000 1.00%

EIS Investors 350,000 35.00%

Institutional Investors 212,920 21.29%

1,000,000 100%

Pre SEIS, EIS and Institutional PlacingsBill Goldie 10,000 2.34%

Tessa Laws 20,000 4.68%

John Nicol 20,000 4.68%

Nick Dimmock 150,000 35.12%

Grue and Hornstrup A/S 200,000 46.83%

David Burns 15,000 3.51%

Family and Friends SEIS 12,080 2.83%

427,080 100%


D. Shareholders and Shareholdings Pre Institutional Equity Raise

E. Shareholders Post Equity Raise


F. Stakeholder Agreements

a) Memorandum of Understanding



B) Particular Conditions


1 Costs are based on a 3 MW Photovoltaic Power Plant. For any extra capacity in increments of 0-1 MW to be installed2 the Consultants will have an additional budget. Billing rates are provided in Annex A to this document





Project Title Host Country Client Status

Biomass Fuel Switch at Sapphire Finishing Mills Pakistan Confidential AT VALIDATION

Sector Focus on waste water, Energy Efficiency, and Renewable Energy Uganda Confidential UNDER DEVELOPMENT

Methane avoidance project at Colony Sugar Mills Ltd. Pakistan Confidential AT VALIDATION

Methane avoidance project at Abdullah Sugar Mills Ltd. Pakistan Confidential CLOSED

Methane avoidance project at pinnacle Distilleries Ltd. Pakistan Confidential CLOSED

Methane avoidance project at Habib Sugar Mills Ltd. Pakistan Confidential CLOSED

permeate gas utilization project (200Mwe) at Engro Pakistan Engro Energy AT VALIDATION

CO2 stripping at Engro Chemical pakistan Limited Pakistan

Engro Chemical Pakistan Limited

CLOSED

purge gas utilization at Engro Chemical pakistan Limited Pakistan

Engro Chemical Pakistan Limited

CLOSED

N2O abatement at jinan Chemical Fertilizers (2) China Vitol S.A.REGISTERED AND CURRENTLY

MONITORING (410,000 T/YR)

N2O abatement at 10 fertilizer plants China Confidential REGISTERED (>5 MIO T/YR)

N2O Abatement project at Feng XI China Vitol A.S. CLOSE

Lovochemie N2O abatement from nitric acid Czech Republic Danish Energy Agency

OPERATIONAL AND MONITORING (500,000 T/YR)

Biomass Energy Romania Romania Danish Energy AgencyOPERATIONAL AND MONITORING

(70,000 T/YR)

Geothermal energy in Oradea and Beius Romania Danish Energy AgencyOPERATIONAL AND MONITORING

(20,000 T/YR)

Energy efficiency improvement of the district heating system in Drobeta Turnu-Severin Romania Danish Energy Agency


Energy efficiency improvement at Holboca CET Iasi II power Station Romania Danish Energy Agency


Landfill gas extraction and utilisation in Focsani Romania Danish Energy Agency COMPLETED

Landfill gas extraction and utilisation in Tirgu Mures Romania Danish Energy Agency Closed

Landfill gas extraction and utilisation in Iasi Romania Danish Energy Agency Closed

Landfill gas extraction and utilisation in Suceava Romania Danish Energy Agency Closed

Landfill gas extraction and utilisation in Galati Romania Danish Energy Agency Closed

Landfill gas extraction and utilisation in Cluj Napoca Romania Danish Energy Agency Closed

Demand Side Energy Efficiency in ResitaRomania Danish Energy Agency Closed

Below is a selection of approved references from G+H’s International Energy & Environmental Business

Project development


G. Additional References for Grue og Hornstrup A/s


N2O Abatement JI Project at an Nitric Acid production facility (2) Ukraine Confidential COMPLETED

Large Scale biomass Waste to Energy Project (2) Russia Confidential COMPLETED

Large Scale biomass Waste to Energy Project Russia Confidential COMPLETED

Energy efficiency improvement Pulp and Paper facility Russia Confidential COMPLETED

Waste heat recovery in Pulp and Paper facility Russia Confidential COMPLETED

N2O Abatement JI Project at an Nitric Acid production facility Ukraine Confidential COMPLETED

N2O Avoidance/ destruction JI Project at Adipic Acid production Germany Confidential COMPLETED

Waste Heat Recovery in Cement Plant China Confidential COMPLETED

Raw Material blending (E.E.) in Cement Plant China Confidential COMPLETED

Cole Mine Methane utilization China Confidential COMPLETED

Small Scale Hydro Projects (2) Peru Confidential COMPLETED

Raw Material blending and Waste Heat Recovery in Cement Plant Saudi Arabia Confidential COMPLETED

biomass Co-Generation in Palm Oil Sector (3) Malaysia Confidential COMPLETED

biomass/Wastewater Aerobic Composting in Palm Oil Sector (7) Malaysia Confidential COMPLETED

N2O Abatement CdM Projects at an Nitric Acid production plants (4) China Confidential COMPLETED

N2O Abatement CdM Projects at Nitric Acid production facilities (2) North Africa Confidential COMPLETED

Landfill gas recovery and utilization (3) Russia Confidential COMPLETED


Timisoara Combined Heat and power Rehabilitation project for CET SUD Location Romania

Swedish Energy Agency

COMPLETED

South west Region fuel switch and Energy Efficiency RussiaDanish Energy

AgencyCOMPLETED

Kirov Region fuel switch and Energy Efficiency Russia NEFCO COMPLETED

Landfill gas utilization project Romania NEFCO COMPLETED

Biomass Energy RomaniaDanish Energy

AgencyONGOING

Geothermal energy in Oradea and Beius RomaniaDanish Energy

AgencyONGOING

Energy efficiency improvement of the district heating system in Drobeta Turnu-Severin Romania

Danish Energy Agency

ONGOING

Energy efficiency improvement at Holboca CET Iasi II power Station Romania

Danish Energy Agency

ONGOING

N2O abatement at jinan Chemical Fertilizers (2) China Vitol S.A. ONGOING


G. Additional References for Grue og Hornstrup A/s

Selected Post Implementation Services for monitoring and operation

Selected due diligence

5.45 Mwp shovel ready

4.86 Mwp near shovel ready

54 Mwp Shovel ready, but needs to be divided into smaller sites.

2.4 Mwp Shovel Ready



7.0 Mwp Close to shovel ready

9.0 Mwp Shovel ready

3.1 Mwp Close to shovel ready

In addition to the projects detailed in this Information Memorandum, we are currently progressing due dili-gence on the following projects.


H. Project Design and Project Slate

It is anticipated that the design of the solar projects will be in line with Grue and Hornstrup‘s centralized design concept as detailed in this document.

However, on the basis that Solar 350 will be purchasing some semi-developed sites, changing the design param-eters may mean resubmitting the design proposals to the Romanian government. As Solar farms are relatively simple and gains from improved design are marginal, So-lar 350 does not anticipate that it will utilize one design for all solar farms.

Thus, it is much more important to review the individual semi-developed solar farms, conduct appropriate due diligence and then select them on the basis their com-mercial and operational attributes.

Solar 350 is currently in discussions with a number of equipment manufacturers. As technology has devel-oped and proliferated throughout the world solar panels have increasingly become fungible commodity.

There are, of course variables such of size, build qual-ity and to certain extents efficiency. So while there are equipment suppliers that should be avoided, the choice


I. Solar Equipment

of solar power provider is now more related to cost and business terms and other ancillary benefits that the pan-el manufacturer can provide.

Grue and Hornstrup are responsible for the decision on which panels to use.

to Constanta in Romania and then managing the over ground route from there. G+H will be responsible for this section of the process.


J. Equipment Transport Assessment

Solar 350 anticipates that the solar panels and mounts will either be sourced from China or Germany. This pro-vides Solar 350 with either managing an over ground route directly from Germany or shipping from China


K. Projects Costings

The following has been provided by G+H. Essentially, this demonstrates to increased economies of scale available from larger projects. Solar 350 base costs for development of 20MW is €1.5M per MW of installed power. However, Solar 350 will endeavor to lower costs and increase efficiencies without decreasing the quality of the projects.

Project details

Name2.4MW Example Project

Developer

Owner

Data of Costs Assessment 07/02/2013

II Electricity Regulations (Processing & Application fees) unit Quantity unit Cost Itemized Cost

i Authentication for connection to the grid MW 2.40 3500 8400

ii Notice and request for capacity reservation (distributor) fee 1.00 2500 2500

iii Study of Connectivity (ATR) MW 2.40 2500 6000

iv Final Reservation Fees + Secured Connection Agreement (ATR) MW 2.40 7500 18000

v Licenses for electricity production from RES - ANRE MW 2.40 3500 8400

vi Qualification certificate of preferential production of electricity - ANRE MW 2.40 3500 8400

vii Registration as an Electricity seller at OPCOM fee 1.00 5000 5000

viii Registration for Green Certificate trading at OPCOM fee 1.00 5000 5000

61700

TOTAL Regulatory Costs 123,300

I Land Regulations (Processing & Application fees) unit Quantity unit Cost Itemized

CostI Environmental Impact Assessment Ha 4 2000 8000

ii Rezoning of Land (Certificate de Urbanism) Ha 4 1500 6000

iii Planning Permission Ha 4 900 3600

iv Building Permits Ha 4 1500 6000

v Purchase Price of Land Ha 4 8,000 32000

vi Constructed Approval Ha 4 1500 6000

61600

Cost breakdown

Sheet A1 - Regulatory Costs 123300

Sheet A2 - Engineering Costs 133200

Sheet B1 - Mechanical Costs 2366480

Sheet B2 - Mechanical Installation Costs 173620

Sheet C1 - Civil Works Costs 177750

Sheet D1 - Miscellaneous Costs 706964Euro

Total Project Costs 3,681,314

Price Per MWp 1,533,881

Technical Parameters to fill Out

PV Plant Capacity MW 2.40

Land Requirements ha 4.00

Transmission line km 2.8

Access Roads m 200

Perimeter Roads m 500



A) 2.4MW Example Costings

Sheet A1 - Regulatory Costs

I Power Transmission Side unit Quantity unit Cost Itemized Cost

I Transmission line (underground insulated line up to 15 kV) km 2.8 27000 75600

ii Transmission line marking & protection km 2.8 4500 12600

iii Switch boxes Breakers no. 2.0 12000 24000

iv Electricity Meters no. 2.0 7000 14000

126200



IV Control / Office building unit Quantity unit Cost Itemized Cost

i 220/380 v installation in control building 45A no. 1.0 15000 15000

ii Internal Lighting and heating units no. 4.0 200 800

iii External lighting (150W) no. 3.0 200 600

iv Low V cabling m 300 10 3000

19400

TOTAL Mechanical Costs 2,366,480

III Panels/frames and dC side equipment unit Quantity unit Cost Itemized Cost

i Internal site (coated) main DC cabling 25A m 2640 12 31680

ii Lightening projection units no. 240 35 8400

iii Panels (250wp) Wp 2400000 0.5 1200000

iv Mounting frames - Wp 2400000 0.11 264000

v Array boxes no. 24 3300 79200

vi Security CCTV…etc. no. 1.0 40000 40000

1623280

II Inverter/Transformer and AC side Equipment unit Quantity unit Cost Itemized Cost

i Combined Inverter/Transformer Station - Container (1 MW) no. 2 186000 372000

ii Combined Inverter/Transformer Station - Container (0.5 MW) no. 1 93000 93000

iii Internal site (coated) main DC cabling 350A m 2400 12 28800

iv Internal site (coated) main AC cabling 1000 kVA m 1200 15 18000

v Line marking & protection m 3600 3 10800

vi SCADA control unit no. 1 75000 75000

597600

Sheet b1 - Mechanical Costs


i Internal site (coated) main DC cabling 25A w/ protection man-days 53 150 7920

ii Lightening projection units man-days 48 150 7200

iii Panels (250wp) man-days 96 150 14400

iv Mounting frames - man-days 192 150 28800

v Array boxes man-days 24 250 6000

vi Security CCTV…etc. man-days 10.0 250 2500

vii Rented Equipment (post ramming machine) Lease-mon 7.2 7500 54000

120820

II Inverter/Transformer and AC side Equipment Int unit Quantity unit Cost Itemized Cost

i Combined Inverter/Transformer Station Installation man-days 30 250 7500

ii Internal site (coated) main DC cabling 350A w/ protection man-days 48 150 7200

iii Internal site (coated) main AC cabling 1000 kVA w/ protection man-days 24 150 3600

iv SCADA control unit man-days 5 250 1250

v Supplier commissioning engineer man-days 10 1500 15000

34550

I Power Transmission Side Int unit Quantity unit Cost Itemized Cost

I Transmission cables laying man-days 84 150 12600

ii Connection of Switch boxes Breakers man-days 4.0 250 1000

iii Elect Meters man-days 4.0 250 1000

14600

IV Control / Office building Int unit Quantity unit Cost Itemized Cost

i 220/380 v installation in control building 45A man-days 3.0 250 750

ii Internal Lighting and heating units man-days 5.0 250 1250

iii External lighting (150W) man-days 3.0 250 750

iv Low V cabling man-days 6.0 150 900

3650

TOTAL Mechanical Costs 173,620



Sheet b2 - Mechanical Installation Costs

I Power Transmission Side Civil Works unit Quantity unit Cost

Itemized Cost

I Transmission line trench and cover (<1.5m) km 2.8 12000 33600

33600



II On Site Civil Works plus Installation unit Quantity unit Cost Itemized Cost

i Access Road - compaction and gravel for 40t trucks m 200 60 12000

ii Perimeter Road - compaction and gravel for 40t trucks m 500 60 30000

iiiPerimeter Road - drainage trench - 50cmx50cm one side - w/ >0.25% slope (950m)

m 500 5 2500

iv Catchment basin for road (w/ livestock fence) m3 100 35 3500

v Perimeter Fencing - steel m 800 10 8000

vi Perimeter main gate - steel no. 1 3000 3000

vii Perimeter person gate no. 1 750 750

viii Level and compaction of land - w/ >0.25% slope ha 4.00 10000 40000

ix Seeding (grass) of land ha 4.00 3000 12000

x Control Building - 40’ Livable Container no. 1 7500 7500

xi Storage Building - 40’ Container no. 1 3500 3500

xii Parking lot and internal road - compacted and gravel m2 300 15 4500

xiiiParking lot and internal road - drainage - drainage trench - 30cmx30cm

w/ >0.25% slopem 80 5 400

xivLay down yard and Container Pads - compacted and gravel - for - 40’ containers

no. 5 750 3750

xv Concrete Foundations for Inverter stations - 9x 7mx2.5m containers 18t no. 3 1500 4500

xvi Compacting land for Inverter stations - 9x 7mx2.5m containers 18t no. 3 750 2250

xvii Housing containers lease during construction no. 2 1500 3000

xviii Sewage (20m sewage line, 30 leachate line, and septic tank 2000 l) no. 1 3000 3000

144150

TOTAL Civil Works Costs 177,750

Sheet C1 - Civil Works Costs

I Msc unit Quantity unit Cost Itemized Cost

i Insurance During Construction no. 1.0 31000 31000

ii Workers housing compensation no. 24.0 400 9600

iii RO Additional Equipment transport 40t trips no. 30.0 4000 120000

iv Additional cost of Purchase of Project MW 2.4 100000 240000

400600

II Contingencies Cost Cont % Itemized Cost

A1 Land Regulations (Processing & Application Fees) 61600 10% 6,160

A1 Electricity Regulations (Processing & Application Fees) 61700 10% 6,170

A2 Design Concept & Tendering Engineering (DK - Consultancy) 43500 5% 2,175

A2 Design Engineering (RO - Consultancy) 31200 10% 3,120

A2 Supervision Engineering to Commissioning (Consultancy) 58500 5% 2,925

B1 Power Transmission Side 126200 15% 18,930

B1 Inverter/Transformer and AC side Equipment 597600 5% 29,880

B1 Panels/Frames and DC side equipment 1623280 10% 162,328

B1 Control / Office Building 19400 10% 1,940

B2 Power Transmission Side Int 14600 15% 2,190

B2 Inverter/Transformer and AC side Equipment Int 34550 15% 5,183

B2 Panels/Frames and DC side equipment Int 120820 15% 18,123

B2 Control / Office Building Int 3650 15% 548

C1 Power Transmission Side Civil Works 33600 15% 5,040

C1 On Site Civil Works plus Installation 144150 15% 21,623

D1 Miscellaneous Costs 400600 5% 20,030

306,364




Sheet d1 - Miscellaneous Costs

Project details

Name 7.6 MW Example Project

Developer

Owner

Data of Costs Assessment 07/02/2013



B) 7.6MW Example

Cost breakdown

Sheet A1 - Regulatory Costs 399300

Sheet A2 - Engineering Costs 241100

Sheet B1 - Mechanical Costs 7124270

Sheet B2 - Mechanical Installation Costs 494030

Sheet C1 - Civil Works Costs 481150

Sheet D1 - Miscellaneous Costs 2121337

EuROTotal project Costs 10,861,187

Price Per MWp 1,429,103

Technical Parameters to fill Out

PV Plant Capacity MW 7.60

Land Requirements ha 15.00

Transmission line km 8.5

Access Roads m 600

Perimeter Roads m 1000

II Electricity Regulations (Processing & Application fees) unit Quantity unit Cost Itemized Cost

i Authentication for connection to the grid MW 7.60 3500 26600

ii Notice and request for capacity reservation (distributor) fee 1.00 2500 2500

iii Study of Connectivity (ATR) MW 7.60 2500 19000

iv Final Reservation Fees + Secured Connection Agreement (ATR) MW 7.60 7500 57000

v Licenses for electricity production from RES - ANRE MW 7.60 3500 26600

vi Qualification certificate of preferential production of electricity - ANRE MW 7.60 3500 26600

vii Registration as an Electricity seller at OPCOM fee 1.00 5000 5000

viii Registration for Green Certificate trading at OPCOM fee 1.00 5000 5000

168300

TOTAL Regulatory Costs 399,300

I Land Regulations (Processing & Application fees) unit Quantity unit Cost Itemized Cost

i Environmental Impact Assessment Ha 15 2000 30000

ii Rezoning of Land (Certificate de Urbanism) Ha 15 1500 22500

iii Planning Permission Ha 15 900 13500

iv Building Permits Ha 15 1500 22500

v Purchase Price of Land Ha 15 8,000 120000

vi Constructed Approval Ha 15 1500 22500

231000



B) 7.6MW Example

Sheet A1 - Regulatory Costs

I design Concept & Tendering Engineering (dK - Consultancy) unit Quantity unit Cost Itemized Cost

i Project Sourcing MW 7.6 5000 38000

ii PV Power Plant Concept Design no. 1.0 4500 4500

iii Tender Dossiers and Evaluation for Civil Works no. 1.0 9000 9000

iv Tender Dossiers and Evaluation for Mechanical Works no. 1.0 9000 9000

v Tender Dossiers and Evaluation for Major Equipment no. 1.0 9000 9000

(Reimbursable costs included)

69500



B) 7.6MW Example

III Supervision Engineering to Commissioning (Consultancy) unit Quantity unit Cost Itemized Cost

i Startup Phase no. 1.0 9000 9000

ii Civil Works Phase no. 1.0 18000 18000

iii Mechanical Works Phase no. 1.0 18000 18000

iv Commissioning Phase no. 1.0 13500 13500

v Additional (over 3 MW) no. 4.6 13500 62100


120600

TOTAL Engineering Costs 241,100

II design Engineering (RO - Consultancy) unit Quantity unit Cost Itemized Cost

i Site Survey and layout Ha 15.00 1800 27000

ii Detailed Civil Works Design no. 1.00 10500 10500

iii Detailed Mechanical Works Design no. 1.00 10500 10500

iv Stamps and Approvals no. 1.00 3000 3000


51000

Sheet A2 - Engineering Costs


i Internal site (coated) main DC cabling 25A m 8360 12 100320

ii Lightening projection units no. 760 35 26600

iii Panels (250wp) Wp. 7600000 0.5 3800000

iv Mounting frames - Wp. 7600000 0.11 836000

v Array boxes no. 76 3300 250800

vi Security CCTV…etc. no. 1.0 40000 40000

5053720

IV Control / Office building unit Quantity unit Cost Itemized Cost

i 220/380 v installation in control building 45A no. 1.0 15000 15000

ii Internal Lighting and heating units no. 4.0 200 800

iii External lighting (150W) no. 3.0 200 600

iv Low V cabling m. 3O 10 3000

19400

TOTAL Mechanical Costs 7,124,270

II Inverter/Transformer and AC side Equipment unit Quantity unit Cost Itemized Cost

i Combined Inverter/Transformer Station - Container (1 MW) no. 7 186000 1302000

ii Combined Inverter/Transformer Station - Container (0.5 MW) no. 2 93000 186000

iii Internal site (coated) main DC cabling 350A m. 7600 12 91200

iv Internal site (coated) main AC cabling 1000 kVA m 3800 15 57000

v Line marking & protection m 11400 3 34200

vi SCADA control unit no. 1 75000 75000

1745400

I Power Transmission Side unit Quantity unit Cost Itemized Cost

i Transmission line (underground insulated line up to 15 kV) km 8.5 27000 229500

ii Transmission line marking & protection km 8.5 4500 38250

iii Switch boxes Breakers no. 2.0 12000 24000

iv Electricity Meters no. 2.0 7000 14000

305750



B) 7.6MW Example

Sheet b1 - Mechanical Costs


i Transmission cables laying man-days 255 150 38250

ii Connection of Switch boxes Breakers man-days 4.0 250 1000

iii Elect Meters man-days 4.0 250 1000

40250

II Inverter/Transformer and AC side Equipment Int unit Quantity unit Cost Itemized Cost

i Combined Inverter/Transformer Station Installation man-days 90 250 22500

ii Internal site (coated) main DC cabling 350A w/ protection man-days 152 150 22800

iii Internal site (coated) main AC cabling 1000 kVA w/ protection man-days 76 150 11400

iv SCADA control unit man-days 5 150 1250

v Supplier commissioning engineer man-days 10 1500 15000

72950



B) 7.6MW Example

IV Control / Office building Int unit Quantity unit Cost Itemized Cost

i 220/380 v installation in control building 45A man-days. 3.0 250 750

ii Internal Lighting and heating units man-days. 5.0 250 1250

iii External lighting (150W) man-days. 3.0 250 750

iv Low V cabling man-days. 6.0 150 900

3650

TOTAL Installation Mechanical Costs 494,030

III Panels/frames and dC side equipment Int unit Quantity unit Cost Itemized Cost

i Internal site (coated) main DC cabling 25A w/ protection man-days 167 150 25080

ii Lightening projection units man-days. 152 150 22800

iii Panels (250wp) man-days. 304 150 45600

iv Mounting frames - man-days. 608 150 91200

v Array boxes man-days. 76 250 19000

vi Security CCTV…etc. man-days. 10.0 250 2500

vii Rented Equipment (post ramming machine) Lease-mon 22.8 7500 171000

377180

Sheet b2 - Mechanical Installation Costs

II On Site Civil Works plus Installation unit Quantity unit Cost Itemized Cost

i Access Road - compaction and gravel for 40t trucks m 600 60 36000

ii Perimeter Road - compaction and gravel for 40t trucks m 1000 60 60000

iiiPerimeter Road - drainage trench - 50cmx50cm one side - w/ >0.25% slope (950m)

m 1000 5 5000

iv Catchment basin for road (w/ livestock fence) m3 100 35 3500

v Perimeter Fencing - steel m 3000 10 30000

vi Perimeter main gate - steel no. 1 3000 3000

vii Perimeter person gate no. 1 750 750

viii Level and compaction of land - w/ >0.25% slope ha 15.00 10000 150000

ix Seeding (grass) of land ha 15.00 3000 45000

x Control Building - 40’ Livable Container no. 1 7500 7500

xi Storage Building - 40’ Container no. 1 3500 3500

xii Parking lot and internal road - compacted and gravel m2 300 15 4500

xiiiParking lot and internal road - drainage - drainage trench - 30cmx30cm

w/ >0.25% slopem 80 5 400

xivLay down yard and Container Pads - compacted and gravel - for - 40’

containersno. 5 750 3750

xv Concrete Foundations for Inverter stations - 9x 7mx2.5m containers 18t no. 9 1500 13500

xvi Compacting land for Inverter stations - 9x 7mx2.5m containers 18t no. 9 750 6750

xvii Housing containers lease during construction no. 2 1500 3000

xviii Sewage (20m sewage line, 30 leachate line, and septic tank 2000 l) no. 1 3000 3000

72950



i Transmission line trench and cover (<1.5m) km 8.5 12000 102000

102000



B) 7.6MW Example

Power Transmission Side Civil Works



B) 7.6MW Example

II Contingencies Cost Cont % Itemized Cost

A1 Land Regulations (Processing & Application Fees) 231000 10% 23,100

A1 Electricity Regulations (Processing & Application Fees) 168300 10% 16,830

A2 Design Concept & Tendering Engineering (DK - Consultancy) 69500 15% 10,425

A2 Design Engineering (RO - Consultancy) 51000 25% 12,750

A2 Supervision Engineering to Commissioning (Consultancy) 120600 15% 18,090

B1 Power Transmission Side 305750 15% 45,863

B1 Inverter/Transformer and AC side Equipment 1745400 5% 87,270

B1 Panels/Frames and DC side equipment 5053720 10% 505,372

B1 Control / Office Building 19400 10% 1,940

B2 Power Transmission Side Int 40250 15% 6,038

B2 Inverter/Transformer and AC side Equipment Int 72950 15% 10,943

B2 Panels/Frames and DC side equipment Int 377180 15% 56,577

B2 Control / Office Building Int 3650 15% 548

C1 Power Transmission Side Civil Works 102000 15% 15,300

C1 On Site Civil Works plus Installation 379150 15% 56,873

D1 Miscellaneous Costs 1193733.33 5% 59,687

927,603

TOTAL Msc Costs 2,121,337

I Msc unit Quantity unit Cost Itemized Cost

i Insurance During Construction no. 1.0 110000 110000

ii Workers housing compensation no. 76.0 400 30400

iii RO Additional Equipment transport 40t trips no. 73.3 4000 293333

iv Additional cost of Purchase of Project MW 7.6 100000 760000

1193733


0&M 1 Itemized Annual O&M unit Itemized cost

Itemized cost

Itemized Cost

PV PLANT SIZE MW 2.40 5.00 7.60i On site operation and security staff per/yr 36,000 36,000 36,000

ii Permits and licenses renewals per/yr 3,600 7,500 11,4000

iii Elec. maintenance per/yr 6,000 100000 19,000

iv Land and building taxes per/yr 2,400 5,000 7,600

v Energy Audits and reporting per/yr 12,000 12,000 12,000

vi Civil works per/yr 4,800 10,000 15,200

vii M&E installation per/yr 7,200 15,000 22,800

viii Transmission line/step up per/yr 1,800 3,750 5,700

ix Solar panals per/yr 3,600 7,500 11,400

x inverters and trans per/yr 66,000 137,500 209,000

xi SCADA/ meters/Security sys per/yr 1,800 3,750 5,700

xii Mounting systems per/yr 2,400 5,000 7,600

xii Insurance per/yr 9,600 20,000 30,400

xiv Msc per/yr 8,000 24,000 30,000

EUR 165,200 299,500 423,800

EUR/MW 68,833 59,900 55,763

ANTICIPATEd fIRST YEAR G&A % based on Costs

Equity Sourcing 1.75% 9,187,500 160,781

Miscellaneous 0.75% 9,187,500 68,906

Solar 350 Operating Costs 2.50% 9,187,500 229,68

Actual 459,375

1ST YEAR G&A BUDGET 5.00% 9,187,500 459,375


L. O&M Cost Breakdown


M. 1st Year G&A Cost Breakdown based on 20MW 75% Debt / 25% Equity

Plant operation and maintenance costs

ONGOING G&A COSTS P.A € 3,010,321 15% € 451,548

MONTHLY. TERM YEARLY

Office 2500 12 30,000

Operational 2500 12 30,000

Legal 2000 12 24,000

Accounting 2000 12 24,000

Audit 500 12 6,500

SALARIES & EXpENSESDavid Burns 1200 12 14,400

Doru Laslau 750 12 9,000

A.N.Other 1000 12 12,000

FIXED COSTS p.A 137,900

GRUE AND HORNSTRUp A/S CONSULTANCY FEES EST: 65,000

Doru Bonus 0.50% 3,010,321 15,052

A.N.Other 0.50% 3,010,321 15,052

pERFORMANCE RELATED pAY (pRp) 30,103

MISCELLANEOUS COSTS 1% 3,010,321 30,103

G&A COSTS LESS FIXED COSTS, CONSULTANCY AND pRp 188,442

SUCCESS FEE pOOL 188,442

ALLOCATED AS FOLLOwS: % of poolNick Dimmock 75.00% 141,331

John Nicol 10.00% 18,844

Tessa Laws 10.00% 18,844

Bill Goldie 5.00% 9,422

SUCCESS FEE ALLOCATED 188,442

CHECK 0.00


N. G&A Cost Breakdown Ongoing based on 20MW 75% Debt / 25% Equity


O. Cash flow Forecast Project

Cash flow forecasts in excel are available upon request.



P. Letter of Intent for Equipment and Mezzanine Finance


Q. Conditional Letter of Intent for Debt Finance


R.European Commission press release


S. Opinion on Romania’s Green Certificate Scheme by Grue og Hornstrup & Supporting Press Releases in Romanian and English.



ANRE

A U T O R I T A T E A N AŢ I O N A LĂ D E R E G L E M E N T A R E

Î N D O M E N I U L E N E R G I E I

COMUNICAT

29 martie 2013

Autoritatea Natională de Reglementare în Domeniul Energiei a realizat Raportul cu privire la analiza de supracompensare a sistemului de promovare prin certificate verzi a

energiei din surse regenerabile de energie pentru anul 2012

Autoritatea Natională de Reglementare în Domeniul Energiei a discutat, în cadrul Comitetului de Reglementare din data de 29 martie a.c. Raportul cu privire la analiza de supracompensare a sistemului de promovare prin certificate verzi a energiei din surse regenerabile de energie pentru anul 2012.

Schema de promovare prin certificate verzi a energiei produse din surse regenerabile de energie a fost autorizată prin Decizia Comisiei Europene C (2011) 4938 din 13.07.2011: Ajutorul de stat

SA 33134 – România – „Certificate verzi pentru promovarea producerii energiei electrice din

surse regenerabile de energie„.

OUG nr. 88/2011, privind modificarea şi completarea Legii nr. 220/2008 pentru stabilirea

sistemului de promovare a producerii energiei din surse regenerabile de energie, a făcut posibilă aplicarea schemei de promovare prin certificate verzi pentru producătorii de energie din surse regenerabile de energie.

Punerea în aplicare a prevederilor Legii nr. 220/2008, republicată, cu modificările şi completările ulterioare, contribuie la dezvoltarea investiţiilor în domeniul producerii energiei electrice din surse regenerabile, având ca efect îndeplinirea obiectivului naţional privind atingerea unei ponderi de 24% a energiei din surse regenerabile din cantitatea de energie pe care o va consuma România în anul 2020 stabilit în anexa I la Directiva 2009/28/CE a Parlamentului European şi a Consiliului din data de 23 aprilie 2009 privind promovarea utilizării energiei din surse regenerabile, de modificare şi ulterior de abrogare a Directivelor 2011/77/CE şi 2003/30/CE.

ANRE are în atribuţii monitorizarea costurilor şi veniturilor rezultate din activitatea de producere a E-SRE pentru producătorii care beneficiază de schema de promovare prin certificate verzi, în vederea modificării schemei pentru noii intraţi, dacă se constată tendinţe de supracompensare.

Metodologia de monitorizare a sistemului de promovare a energiei din surse regenerabile de energie prin certificate verzi detaliază modul în care se face analiza de supracompensare a activităţii de producere a E-SRE pentru producătorii beneficiari ai schemei de sprijin; analiza de supracompensare se realizează anual pe perioada în care această activitate este promovată prin schema de sprijin prin certificate verzi, pe baza evoluţiei următorilor indicatori:

1. nivelul mediu al investiţiei specifice;2. nivelul mediu al costurilor variabile specifice;3. nivelul mediu al costurilor fixe specifice;4. nivelul mediu al factorului de capacitate.

Mecanismul de revizuire a numărului de certificate rezultat în urma analizei de supracompensare se bazează pe recalcularea anuală, pe durata de aplicare a schemei de sprijin, a numărului de

Str. Constantin Nacu nr. 3, sector 2, Bucureşti, telefon: 021/311.22.44, fax: 021/312.43.65, mail: [email protected];pagină de internet: www.anre.ro




T. Preliminary overview over the possibility to reduce the GCs support scheme 19042013

Legal opinion can be provided upon request.


U. Confirmation of Advanced Assurance in Relation to Tax Status from HMRC

Please note: In order to subscribe to the EIS offering as detailed in this Information Memorandum, subscribers need to complete the following sections of the remain-der of this document:

10.3 APPLICATION fORM10.4 AGREEMENT AND EITHER 10.5 STATEMENT Of HIGH NET WORTH OR10.6 STATEMENT Of SOPHISTICATEd

INVESTOR STATuS

This document contains “inputable” fields. This means subscribers can complete the forms electronically and then print out the pages for signing.

Thus, all pages onwards from this point should be com-pleted, printed, signed and dated and placed in an enve-lope along with 2 Proofs of Address. This should then be posted to:

Pomfrey Accountants LtdSolar 350 EIS Offer

unit 42, The Coach HouseSt Mary’s business Centre

66-70 bourne Roadbexley, Kent, dA5 1Lu

united England

More in depth instructions as well as terms and condi-tion of the offer can be found in the following sections.

10. SUBSCRIPTION BUNDLE

10.1 PROCEDURE

I. This offer for Class A Ordinary Voting Shares will open on the Wednesday 1st May 2013 and will close on Fri-day 7th June 2013, or when fully subscribed, which-ever is sooner. (There is only 1 class of share in Solar 350 Ltd). In the event that Solar 350 does not raise at least £3M, all funds received from this placing will be returned to investors with no deductions.

II. Applications for subscription must be made through the Application Agreement provided in this document.

III. Applicants should complete the subscription agree-ment within this document, sign and date the agreement and also provide two sources of iden-tification. Applicants should also provide details of their status as either High Net Wealth or Sophisti-cated Investors.

IV. The document bundle should then be returned to:

Pomfrey Accountants Ltd Solar 350 EIS Offer


66-70 bourne Roadbexley, Kent, dA5 1Lu

united Kingdom

The documentation will then be reviewed for complete-ness and compliance.

Pomfrey Accountants Ltd can be contacted directly at: Telephone: 01322 315755Fax: 01322 315755E-mail: [email protected]

V. Applicants should either enclose a cheque for the subscribed amount or provide funds through bank transfer to SOLAR 350 LTD, Metro Bank, Sort Code: 230580 Account Number: 11881262.

VI. Pomfrey Accountants will confirm receipt of funds directly with the client.

VII. SOLAR 350 has commissioned Pomfrey Accoun-tants Ltd to complete all necessary paperwork in regard to SEIS/EIS subscriptions and submit this to HMRC on behalf of the subscriber. Pomfrey will li-aise directly with the subscriber in regard to this.

VIII. Oversubscription may result in subscriptions being pared back. Early subscriptions will have preference over late or last minute applications at the discre-tion of the Directors.

10.2 TERMS AND CONDITIONS OF THE RESTRICTED OFFER

1. Applications for Offer Shares (Class A Ordinary Vot-ing Shares) are subject to the terms and conditions included in the Application Form and set out below.

2. The basis of allotment will be determined by the directors in their absolute discretion. The directors reserve the right:

i. to reject any application in whole or in part or to scale down any applications or to accept applications on a “first come first served” basis;

ii. to extend the period during which the sub-scription list remains open;

iii. to treat any application as valid and binding on an applicant even if the Application Form is not complete in all respects or is not accom-panied by a power of attorney where required.

3. The Subscription Bundle should be completed in full and sent or delivered to the address set out in section 10. Procedure, point IV. Please also send 2 proofs of address. Investors are advised to allow two full business days for delivery through the post and to use first class mail.

4. Subscribers should either enclose send in a cheque in favour of SOLAR 350 Ltd or should send funds to SOLAR 350 LTD, Metro Bank, Sort Code: 230580 Account Number: 11881262 quoting subscribers “First Name Surname” as a reference.

5. The right is reserved to reject any cheques or send back any transfers, if SOLAR 350 compliance is not cleared or at the recommendation of the Directors of SOLAR 350.

6. By completing and delivering an Application Form, you irrevocably undertake as follows:

i. to subscribe for the number of shares speci-fied in the Application Form, on the terms of,

and subject to, the conditions set out in this document, including these terms and condi-tions and subject to the memorandum and articles of association of the Company;

ii. to accept such Offer Shares as may be allotted to you in accordance with the Subscription Agreement of the application form or such lesser number (being not less than in value) of Offer Shares in respect of which this applica-tion may be accepted (in this case a portion of your contribution will be refunded).

iii. that all applications, acceptances, allotments and contracts arising from it will be governed by and construed in accordance with English law;

iv. that you are not under the age of 18 and that if you sign the Application Form on behalf of somebody else or a corporation you have the authority to do so and such person will also be bound accordingly and will be deemed also to have given the confirmations, warranties and undertakings contained in these terms and conditions of application; you authorise the Company or any of its respective agents to send by post a share certificate for the num-ber of Offer Shares for which your application is accepted and/or a crossed cheque and/or return your cheque(s) or banker’s draft(s) for any monies returnable, in each case at the risk of the person(s) entitled thereto, to your ad-dress (or that of the first named applicant) as set out in the Application Form and to procure that your name (together with the name(s) of any other joint applicant(s)) is/are placed on the Register of Members of the Company in respect of such Offer Shares;

v. that this document has been provided to you for information purposes only you are not relying on any information or representation,

10.2 TERMS AND CONDITIONS OF THE RESTRICTED OFFER

warrants or statements and accordingly you agree that neither the Company nor any oth-er person shall have any liability for any such other information or representation, warrant or statement;

vi. on request by the Company, to disclose prompt-ly in writing to it any information which it may request in connection with your application;

vii. that the remittance accompanying your Appli-cation Form will be honored at first presenta-tion and agree that if it is not so honored the Company may (without prejudice to any other rights it may have) avoid the agreement to al-lot the relevant Offer Shares and may allot or sell them to some other person in which case you will not be entitled to any refund or pay-ment in respect thereof; and

viii. that you are a Certified High Net Worth Indi-vidual or Self-Certified Sophisticated Investor or a Certified Sophisticated Investor.

7. Applications will not be accepted from persons resident in the United States of America, Canada, Australia, Japan, the Republic of South Africa or the Republic of Ireland and by completing and returning the Application Form the Investor warrants that he is not a person so resident. No person receiving a copy of this Information Memorandum and/or an Application Form in any other territory (other than the United Kingdom), may treat the same as consti-tuting an invitation or offer to him, nor should he in any event use such Application Form, unless in the relevant territory such an invitation or offer could lawfully be made to him and such Application Form could lawfully be used without contravention of any regulation or other legal requirements. It is a condi-tion of any application by any such person outside the United Kingdom that he has satisfied himself as to the full observance of the laws of any relevant ter-ritory, including the obtaining of any governmental

or other consents which may be required and has observed any other formalities in such territory and paid any issue, transfer or other taxes required to be paid in such territory in respect of any Offer Shares acquired under the Restricted Offer. The completion of an Application Form shall constitute a warranty that the person completing such application form has observed such laws and formalities in full and paid such issue, transfer or other taxes. The Compa-ny reserves the right to request investors to produce evidence satisfactory to them of their right to apply for Offer Shares under the Restricted Offer and that such application would not result in the Company, its advisors or the directors being in breach of any laws or regulations of the relevant jurisdiction.

8. The Company reserves the right to treat any ap-plication, which does not comply strictly with the terms and conditions of the application as never-theless valid.

9. The Management and Directors of Solar 350 re-serve the right to issue share options to the Man-agement, Directors and Grue and Hornstrup in order that the collective shareholdings of these en-tities stays above 20% of the issued share capital of the business.

10. No letters of allotment or other renounceable or temporary documents of title or receipts will be issued in respect of accepted applications but share certificates will be dispatched within 30 days of allotment.

11. Applications will be irrevocable.

12. The verification of identity requirements under the Money Laundering Regulations 2003 applies and the verification of identity of the applicant(s) is re-quired. A failure to provide the necessary evidence of identity may result in the rejection of your appli-cation or in delays in the dispatch of a share certifi-cate or the return of application monies.

Restricted Offer for subscription for Offer Shares each payable in full. This Application Form should be com-pleted and sent to:

Pomfrey Accountants LtdSolar 350 EIS Offer


66-70 bourne Road, bexley, Kent, dA5 1Lu, united England

IMPORTANT – Before completing this Application Form you should read carefully the Terms and Conditions. Def-initions used in the Information Memorandum shall have the same meaning in this Application Form.

The Information Memorandum alone contains full de-tails of SOLAR 350 Limited, the Restricted Offer and the Offer Shares. This Application Form is only made avail-able with and as an enclosure to the Information Memo-randum. The entire contents of the section of the Infor-mation Memorandum headed “Terms and Conditions of the Restricted Offer” is deemed to be included and set out in this Application Form. Any person signing this Application Form under a power of attorney must en-close the original power of attorney (or a copy certified by a solicitor) for inspection. If you post your Application Form, you are recommended to use first class post and allow at least two working days for delivery.

Please include with your application:

1. Copy of a passport or driving license.

2. Copy of utility bill evidencing your home address (being no more than 3 months old).

3. You are welcome to also enclose a Certificate con-firming your status as a sophisticated or high net worth individual pursuant to the Financial Services & markets Act 2000 (Financial Promotions) Order 2005. Alternatively, please complete either the High Net Worth or Sophisticated Investor statements in sections 10.5 or 10.6.

10.3 APPLICATION FORM

SubSCRIbER INfORMATION

Buyer Name:

Company Name: “If Applicable”

Address:

Address:

Town / City: Postcode:

Country: Company Number: “If Applicable”

Your Email Address:

SubSCRIPTION APPLICATION

A. Requested Number of Shares:

B. Share Price: £14.00

C. Total Consideration £:

COMPLIANCE dOCuMENTS PROVIdEd

Proof Of Identity:

Proof Of Address:

Introducing Broker: Please State the name of your contact within Solar 350 Ltd

10.3 APPLICATION FORM

10.4 AGREEMENT

This Agreement has been entered into on the date stated below. Signatures confirm your agreement to the terms within:

ON bEHALf Of THE SubSCRIbER:

Signed:

Print Name:

Title:

Date:

COuNTERSIGNEd IN duE COuRSE ON bEHALf Of SOLAR 350 LTd:

Signed:

Print Name:

Title:

Date:

10.5 STATEMENT OF HIGH NET WORTH STATUS

I declare that I am a certified high net worth individual for the purposes of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005.

I understand that this means:

(a) I can receive financial promotions that may not have been approved by a person autho-rised by the Financial Services Authority;

(b) The content of such financial promotions may not conform to rules issued by the Financial Services Authority;

(c) By signing this statement I may lose signifi-cant rights;

(d) I may have no right to complain to either of the following:

(i) The Financial Services Authority; or

(ii) The Financial Ombudsman Scheme;

(e) I may have no right to seek compensation from the Financial Services Compensation scheme.

I am a certified high net worth individual because at least one of the following applies:

(a) I had, during the financial year immediately preceding the date below, an annual income to the value of £100,000 or more;

(b) I held, throughout the financial year immedi-ately preceding the date below, net assets to the value of £250,000 or more. Net assets for these purposes do not include:

(i) The property which is my primary resi-dence or any loan secured on that resi-dence;

(ii) any rights of mine under a qualifying contract or insurance within the mean-ing of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001; or

(iii) Any benefits (in the form of pensions or otherwise) which are payable on the ter-mination of my service or on my death or retirement and to which I am (or my dependants are), or may be, entitled.

PRINT NAME: __________________________________________________________________________________________ DATE ____________________________

SIGNATURE: ____________________________________________________________________________________________

I accept that I can lose my property and other assets from making investment decisions based on financial promotions. I am aware that it is open to me to seek advice from someone who specialises in advising on investments.

10.6 STATEMENT OF SOPHISTICATED INVESTOR STATUS

I declare that I am a self certified Sophisticated Investor for the purposes of the Financial Services and Markets Act (Financial Promotion) Order 2005.

I understand that this means:

(a) I can receive financial promotions that may not have been approved by a person authorised by the Finan-cial Services Authority;

(b) The content of such financial promotions may not conform to rules issued by the Financial Services Au-thority;

(c) By signing this statement I may lose significant rights;

(d) I may have no right to complain to either of the fol-lowing:

(i) The Financial Services Authority; or

(ii) The Financial Ombudsman Scheme;

(e) I may have no right to seek compensation from the Financial Services Compensation Scheme.

I am a self certified Sophisticated Investor because at least one of the following applies:

(a) I am a member of a network or syndicate of busi-ness angels and have been so for at least the last six months prior to the date below;

(b) I have made more than one investment in an unlisted company in the two years prior to the date below;

(c) I am working, or have worked in the two years prior to the date below, in a professional capacity in the pri-vate equity sector, or in the provision of finance for small and medium enterprises;

(d) I am currently, or have been in the two years prior to the date below, a director of a company with an an-nual turnover of at least £1 million.

I accept that I can lose my property and other assets from making investment decisions based on financial promotions. I am aware that it is open to me to seek advice from someone who specialises in advising on investments.

PRINT NAME: __________________________________________________________________________________________ DATE ____________________________

SIGNATURE: ____________________________________________________________________________________________

SOLAR 350 LTd22 Hanover Square, London. w1S 1jp, United Kingdom T: 0203 151 1 350 F: 0203 151 9 350 w: solar350.co.uk

Solar 350 Ltd Registered Office: Unit 42, The Coach House, St Mary’s Business Centre,66-70 Bourne Road, Bexley, Kent. DA5 1LU

T: 0203 151 1 350 T: 0203 151 9350 w: solar350.co.uk

Solar 350 Ltd is registered in The United Kingdom under Company Number: 07678367

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