Mr. Steve Dalton reports

REVOLVE EXPANDS ITS DISTRIBUTED GENERATION PORTFOLIO

On Jan. 5, 2024, Revolve Renewable Power Corp. signed a power purchase agreement (PPA) for a new 450-kilowatt-peak rooftop solar project in Mexico as part of its growing distributed generation (DG) portfolio.

Project details

• The project will be installed at the site of a food manufacturing business in central Mexico and will assist the customer in meeting its sustainability objectives while also reducing its electricity cost.
• Revolve will be the owner and have the responsibility to finance, install and operate the project.
• A 15-year PPA has been signed between the company and the customer, structured as a fixed price per kilowatt-hour generated by the project. The price per kilowatt-hour is increased annually by inflation.
• An engineering procurement contract (EPC) has been signed with a Mexican corporation -- Inventive Power, a highly experienced installer and operator of solar photovoltaic (PV) and thermal projects in Mexico -- to deliver a turnkey solution for the installation and commissioning of the project. Under this contract, Inventive will also be responsible for all scheduled and unscheduled maintenance required for the project.
• The project is targeted to be operational in June this year and will add to the recurring revenue base of the company's distributed generation business.
• The project is expected to cost approximately $540,000 to install and commission inclusive of all related financing and transaction costs.

Project financing

The project will be financed through a combination of cash on hand and a $415,000 new secured loan to be provided by RE Royalties Ltd. The financing agreements will consist of a secured loan agreement and a royalty agreement between Revolve and RE Royalties. Finalization of the financing agreements is expected to be completed in the next few weeks.

The secured loan will be drawn down per a schedule commencing upon signing of the definitive financing agreements and will have a term of 24 months. It will be repayable at maturity, bear interest at 12 per cent on drawn funds, with interest payable on a quarterly basis during the term. The company will pay RE Royalties a financing fee of 1 per cent of the secured loan amount on signing. The secured loan will be secured by certain assets of the company. The company will also enter into a royalty agreement with RE Royalties under which RE Royalties will receive a royalty of 5 per cent on gross revenues generated by the project for the term of the PPA.

Currency considerations

All transactions over the course of this contract as well as the agreement with the installer will be in Mexican pesos. For ease of reference, all dollar amounts have been presented in Canadian dollars at exchange rate of one Mexican peso to 7.9 cents.

About Revolve Renewable Power Corp.

Revolve was formed in 2012 to capitalize on the growing global demand for renewable power. Revolve develops utility-scale wind, solar and battery storage projects in the United States, Canada and Mexico with a portfolio of approximately 2,838 megawatts under development. The company has a second division, Revolve Renewable Business Solutions, which installs and operates sub-20-megawatt behind-the-meter distributed generation (DG) assets. Revolve Renewable Business Solutions currently has an operating portfolio of six megawatts with an additional three megawatts under construction phase and 156 megawatts under development.

Revolve has an accomplished management team with a demonstrated record of taking projects from greenfield through to ready-to-build (RTB") status and successfully concluding project sales to large operators of utility-scale renewable energy projects. To date, Revolve has developed and sold over 1,550 megawatts of projects.

Revolve is targeting 5,000 megawatts of utility-scale projects under development in the United States, Canada and Mexico and, in parallel, is rapidly growing its portfolio of revenue-generating DG assets.

We seek Safe Harbor.