Definitive Agreement follows the previously announced addition of sales personnel to Solar Alliance team
VANCOUVER , BC--(Marketwired - April 26, 2017) - Solar Alliance Energy Inc. ('Solar Alliance') or (the 'Company') (TSX VENTURE: SAN) (OTC: SAENF) is pleased to announce it has signed a definitive agreement (the "Definitive Agreement") to complete the previously announced acquisition of a pipeline of residential solar projects from a U.S. solar company (the "Seller") based in Los Angeles, California. The Definitive Agreement follows the accelerated transition of the Seller's sales team to Solar Alliance announced on April 12, 2017 and completes the transaction described in the Company's letter of intent first announced on April 4, 2017. The expanded sales team, responsible for more than 7 MW of residential solar systems sales and revenue of more than US$34,305,000 (unaudited) in 2016, has been hired by the Company and has already started selling Solar Alliance residential solar systems to Los Angeles homeowners.
"This transaction expands the Solar Alliance brand into the Los Angeles area and fits perfectly with our growth strategy," said Chairman and CEO Jason Bak. "The assumption of these service contracts for residential solar systems will increase our revenue in the short term. More importantly, the high-performance sales team that has already joined Solar Alliance will drive increased revenues long term and expand our geographic diversification beyond San Diego."
In consideration for the pipeline of residential solar projects, Solar Alliance will pay up to US$2,000,000 in contingent payments, subject to the following payment waterfall:
- Prior to any payment to the Seller, Solar Alliance will be repaid any working capital injected by Solar Alliance, plus an agreed upon return on that capital.
- Once the working capital and working capital return have been paid to Solar Alliance, Solar Alliance will then receive all profit from the Seller up to a 6% net profit threshold.
- For profit in excess of the 6% net profit threshold, 50% will be paid to the Seller until such time as the US$2,000,000 contingent payment is fulfilled. 50% of profits above the 6% net profit threshold will be paid to Solar Alliance.
- There is also a provision for an additional US$2,000,000 contingent payment to the Seller, subject to the same waterfall described above, if revenue from the Seller exceeds US$50,000,000 in any fiscal year.
Chairman and CEO
About Solar Alliance Energy Inc. (www.solaralliance.com)
Solar Alliance is a sales, marketing and development company focused on residential, commercial and industrial solar installations. Since we were founded in 2003, we have developed wind and solar projects that provide enough electricity to power 150,000 homes. Solar Alliance is committed to an exceptional customer experience, effective marketing campaigns and superior lead generation in order to drive sales and generate value for shareholders. Our passion is improving life through ingenuity, simplicity and freedom of choice. We make solar simple and our goal is to install solar on every available rooftop in America.
Statements in this news release, other than purely historical information, including statements relating to the Company's future plans and objectives or expected results, constitute Forward-looking statements. The words "would", "will", "expected" and "estimated" or other similar words and phrases are intended to identify forward-looking information. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the Company's actual results, level of activity, performance or achievements to be materially different than those expressed or implied by such forward-looking information. Such factors include, but are not limited to: uncertainties related to the ability to raise sufficient capital, changes in economic conditions or financial markets, litigation, legislative or other judicial, regulatory and political competitive developments and technological or operational difficulties. Consequently, actual results may vary materially from those described in the forward-looking statements.
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