EXPLANATORY NOTE
This Offering Circular of Energea
Portfolio 4 USA LP is filed as a Post-Qualification Amendment No. 1 ("PQA")
to the offering statement qualified by the U.S. Securities and Exchange
Commission on June 26, 2024 pursuant to Rule 252(f) of Regulation A under the
Securities Act of 1933, which was filed by Energea Portfolio 4 USA LLC prior to
its conversion to a limited partnership as described below.
This PQA includes audited
financial statements as of December 31, 2024, and updates certain disclosures
in the previously qualified Offering Circulars. In particular, this PQA
consolidates disclosures made in all Form 1-U, Form 1-SA, Form 253(g) and Form
1-K filings made on behalf of the Company since June 17, 2024. It is filed to
maintain the qualification of the offering beyond twelve months from the
original qualification date.
Unless otherwise indicated or the
context otherwise requires, all information in this Offering Circular reflects
the terms and conditions of the as of the date of this amendment.
No material changes have been
made to the terms of the securities being offered.
Post-Qualification
Offering Circular
Amendment No. 1
File No. 024-12389
Part II -
Information Required in Offering Circular
AN OFFERING STATEMENT PURSUANT
TO REGULATION A RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE U.S.
SECURITIES AND EXCHANGE COMMISSION (THE "SEC"). INFORMATION CONTAINED IN
THIS PRELIMINARY OFFERING CIRCULAR IS SUBJECT TO COMPLETION OR AMENDMENT. THESE
SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED BEFORE THE
OFFERING STATEMENT FILED WITH THE COMMISSION IS QUALIFIED. THIS PRELIMINARY
OFFERING CIRCULAR SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF
AN OFFER TO BUY NOR MAY THERE BE ANY SALES OF THESE SECURITIES IN ANY STATE IN
WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL BEFORE REGISTRATION OR
QUALIFICATION UNDER THE LAWS OF ANY SUCH STATE. WE MAY ELECT TO SATISFY OUR
OBLIGATION TO DELIVER A FINAL OFFERING CIRCULAR BY SENDING YOU A NOTICE WITHIN
TWO BUSINESS DAYS AFTER THE COMPLETION OF OUR SALE TO YOU THAT CONTAINS THE URL
WHERE THE FINAL OFFERING CIRCULAR OR THE OFFERING STATEMENT IN WHICH SUCH FINAL
OFFERING CIRCULAR WAS FILED MAY BE OBTAINED.
Energea Portfolio
4 USA LP
Up to $50,000,000
in Class A Investor Shares
Offering Circular (Subject to
Completion)
Dated June 16, 2025
This Offering
Circular Follows the Form 1-A Disclosure Format
Energea Portfolio 4 USA LP (the "Company",
"us", "we", "our" and similar terms) is a limited partnership organized under
the laws of Delaware to invest in the acquisition, development, and operation
of solar energy projects in the United States (each a "Project"). The
Company may also lend money to Development Companies and use solar projects as
collateral rather than acquiring Projects for direct ownership (each a "Loan").
The Company's day-to-day operations are managed by Energea Global LLC (the "General
Partner" and together with its affiliates "Energea Global").
The Company is currently offering
up to $50.0 million in limited partnership interests designated as "Class A
Investor Shares" (the "Offering") pursuant to Regulation A ("Regulation
A") of the Securities Act of 1933, as amended (the "Securities Act").
The current price of the Class A Investor Shares is $1.10 per Class A Investor
Share, and the minimum initial investment is $100.
Page i
There is currently no
established secondary market for the Class A Investor Shares, and Investors may
not be able to sell their Class A Investor Shares. While Investors should view
an investment in the Company as long-term, the Company offers a Redemption Plan
in order to provide Investors with an opportunity to obtain liquidity. See
"Securities Being Offered: The Class A Investor Shares-Summary of LP Agreement
and Authorizing Resolution-Redemption Plan" and "Risk Factors-No Market for the
Class A Investor Shares; Limits on Transferability".
Investors
may not be able to sell their Class A Investor Shares except by submitting a
Redemption Request to the Company through our General Partner's website,
www.energea.com (the "Platform"). Pursuant to
the Redemption Plan, Investors must hold their Class A Investor Shares for at
least 60 days before they can request redemption of their Class A Investor
Shares via the Platform; if the General Partner agrees to honor a Redemption
Request, the Company has 90 days to make payment on such redemption; and the
General Partner may, in its sole discretion, amend, suspend, or terminate the
Redemption Plan at any time without prior notice. Additionally, Class A
Investor Shares may not be transferred without the Company's consent, which can
be withheld in its sole discretion, and the General Partner has a right of
first refusal to purchase any Class A Investor Shares proposed to be
transferred. See "Redemption Plan" and "Risk Factors-No Market for the
Class A Investor Shares".
Investors should note that
the General Partner may decide to sell the
Projects or the Company at any time. Should the General
Partner decide to sell the Company, Investors could be forced to sell
their Class A Investor Shares at the direction of the General
Partner. See "Drag-Along Right".
The purchase of these
securities involves a high degree of risk. Before investing, you should read
this entire Offering Circular and exhibits hereto, including "Risk Factors".
The Company is selling Class A
Investor Shares directly to the public through the Platform. Neither the
Company nor any affiliated entity involved in this Offering is a member firm of
the Financial Industry Regulatory Authority, Inc. ("FINRA"), and no
person associated with this Offering will be deemed to be a broker solely by
reason of his or her participation in the sale of our Class A Investor Shares.
Investors will not pay upfront selling commissions or broker fees in connection
with the purchase of Class A Investor Shares. We will reimburse our General
Partner for certain expenses incurred on our behalf, and pay our General
Partner certain fees, as described further under "Compensation of General
Partner".
This is a
"best efforts - no minimum" offering. The Offering commenced on June 26,
2024, and will end on the date we raise the maximum amount being offered,
unless earlier terminated by the Company. We will reimburse the General Partner
for marketing expenses in an amount up to 5% of the total Offering amount
raised. See "Use of Proceeds".
|
|
Per Share
|
Total Maximum
|
|
Public Offering Price
|
$1.09
|
$50,000,000
|
|
Organization, Offering and Marketing Expenses
|
$0.055
|
$2,500,000
|
|
Proceeds to the Company from
this Offering to the Public
|
$1.035
|
$47,500,000
|
THE SEC DOES NOT PASS UPON THE
MERITS OF OR GIVE ITS APPROVAL TO ANY SECURITIES OFFERED OR THE TERMS OF THE
OFFERING, NOR DOES IT PASS JUDGEMENT UPON THE ACCURACY OR COMPLETENESS OF ANY
OFFERING CIRCULAR OR OTHER SOLICITING MATERIALS. THESE SECURITIES ARE OFFERED
PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE COMMISSION; HOWEVER, THE
COMMISSION HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE SECURITIES
OFFERED ARE EXEMPT FROM REGISTRATION.
GENERALLY, NO SALE MAY BE MADE
TO A NON-ACCREDITED INVESTOR FROM THIS OFFERING IF THE AGGREGATE PURCHASE PRICE
THE NON-ACCREDITED INVESTOR PAYS IS MORE THAN 10% OF THE GREATER OF THEIR
ANNUAL INCOME OR NET WORTH. DIFFERENT RULES APPLY TO ACCREDITED INVESTORS AND
NON-NATURAL PERSONS. BEFORE MAKING ANY REPRESENTATION THAT YOUR INVESTMENT DOES
NOT EXCEED APPLICABLE THRESHOLDS, WE ENCOURAGE YOU TO REVIEW RULE
251(D)(2)(I)(C) OF REGULATION A. FOR GENERAL INFORMATION ON INVESTING, WE
ENCOURAGE YOU TO REFER TO WWW.INVESTOR.GOV FOR MORE INFORMATION, SEE "LIMIT
ON AMOUNT A NON-ACCREDITED INVESTOR CAN INVEST".
NEITHER THE SEC NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED
UPON THE ADEQUACY OR ACCURACY OF THIS OFFERING CIRCULAR. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
Page ii
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Page iii
We
make statements in this Offering Circular that are forward-looking statements.
The words "outlook," "believe," "estimate,"
"potential," "projected," "expect,"
"anticipate," "intend," "plan," "seek,"
"may," "could" and similar expressions or statements
regarding future periods are intended to identify forward-looking statements.
These forward-looking statements involve known and unknown risks, uncertainties
and other important factors that could cause our actual results, performance or
achievements, or industry results, to differ materially from any predictions of
future results, performance or achievements that we express or imply in this
Offering Circular or in the information incorporated by reference into
this Offering Circular.
The
forward-looking statements included in this Offering Circular are based upon
our current expectations, plans, estimates, assumptions and beliefs that
involve numerous risks and uncertainties. Assumptions relating to the foregoing
involve judgments with respect to, among other things, future economic,
competitive and market conditions and future business decisions, all of which
are difficult or impossible to predict accurately and many of which are beyond
our control. Although we believe that the expectations reflected in such
forward-looking statements are based on reasonable assumptions, our actual
results and performance could differ materially from those set forth in the
forward-looking statements. Factors which could have a material adverse effect on
our operations and future prospects include, but are not limited to:
·
our ability to effectively deploy the proceeds raised from this
Offering;
·
ability to attract and retain Investors on the Platform;
·
risks associated with breaches of our data security;
· public health
crises, pandemics and epidemics, such as those caused by new strains of
viruses such as H5N1 (avian flu), severe acute respiratory syndrome (SARS) and,
most recently, the novel coronavirus (COVID-19);
· climate change
and natural disasters that could adversely affect our Projects and our
business;
· changes
in economic conditions generally and the renewable energy and securities
markets specifically;
· limited
ability to dispose of assets because of the relative illiquidity of renewable
energy Projects and Loans;
· our failure
to obtain necessary outside financing;
· risks
associated with derivatives or hedging activity;
· intense
competition in U.S. renewable energy markets that may limit our ability to
attract or retain Customers (as defined below);
· defaults
under Supporting Contracts (see "Summary of Supporting Contracts");
· increased
interest rates and/or operating costs;
· the
risk associated with potential breach or expiration of a ground lease, if any;
· our
failure to successfully construct, interconnect, operate or maintain the
Projects;
· inability
of a Borrower to make payments on a Loan;
· the
failure of Projects and Loans to yield anticipated results;
· exposure
to liability relating to environmental and health and safety matters;
Page 1
· our
level of debt and the terms and limitations imposed on us by our debt
agreements;
· our
General Partner's ability to retain executive officers and other
key personnel;
· the
ability of our General Partner to source, originate and service our
Projects and Loans;
· the
ability for our engineering, procurement and construction contractors and
equipment manufacturers to honor their contracts including warranties and
guarantees;
· regulatory
changes impacting our business or our assets (including changes to the laws
governing the taxation of corporations and SEC guidance related to Regulation
A, or the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act");
· changes
in business conditions and the market value of our Projects, including changes
in renewable energy policy, interest rates, prepayment risk, operator or
Borrower defaults or bankruptcy, and generally the increased risk of loss if
our investments fail to perform as expected;
· our
ability to implement effective conflicts of interest policies and procedures
among the various renewable energy investment opportunities sponsored by our General
Partner;
· our
compliance with applicable local, state and federal laws, including the
Investment Advisers Act of 1940, as amended (the "Advisers Act"), the
Investment Company Act of 1940, as amended, and other laws; and
· changes
to U.S. generally accepted accounting principles ("U.S. GAAP").
Any
of the assumptions underlying forward-looking statements could be inaccurate.
You are cautioned not to place undue reliance on any forward-looking statements
included in this Offering Circular. All forward-looking statements are made as
of the date of this Offering Circular and the risk that actual results will
differ materially from the expectations expressed in this Offering Circular
will increase with the passage of time. We undertake no obligation to publicly
update or revise any forward-looking statements after the date of this Offering
Circular, whether because of new information, future events, changed
circumstances or any other reason. Considering the significant uncertainties
inherent in the forward-looking statements included in this Offering Circular,
including, without limitation, those named above and those named under
"Risk Factors", the inclusion of such forward-looking statements
should not be regarded as a representation by us or any other person that the
objectives and plans set forth in this Offering Circular will be achieved.
Energea Portfolio 4 USA LP (the "Company")
is a limited partnership organized under the laws of Delaware. The Company has elected
to be taxed as a "C" corporation for United States federal and state income tax
purposes. The Company's day-to-day operations are managed by Energea Global LLC
(the "General Partner").
The Company was created to invest
in the acquisition, development, and operations of solar energy projects in the
United States (each a "Project"). The Projects will sell power and, in
some cases, environmental commodities, to offtakers (we collectively refer to
offtakers of electricity and environmental commodities as "Customers")
who purchase the power or the environmental commodities under long-term
contracts. The Company may also lend money to Development Companies (which we
collectively refer to as "Borrowers") and use solar projects as
collateral rather than acquiring Projects for direct ownership (each a "Loan").
To date, the Projects and Loans
have produced a stable and predictable stream of cash flow from Customers and
Borrowers. As the Company earns revenue, it uses the revenue to pay for
operating expenses (see "Our Operating Costs and Expenses") and
distributes the remaining cash to the holders of our Class A Investor Shares
(our "Investors"), our Reg D Investors (as such term is defined herein
and together with the Investors, the "Preferred Equity Investors") and
the holders of our Common Shares (which is currently the General Partner). See
"Company Operations and Other Matters".
Page 2
Projects are currently owned by
special-purpose entities (each, a "SPE"). Each SPE is organized as a
U.S. limited liability company. Generally speaking, under U.S. law, the assets
and liabilities of different legal entities are distinct. Thus, the liabilities
of a Project held in one SPE should not affect the assets of another Project
held in a different SPE.
The Company is offering up to
$50.0 million of Class A Investor Shares pursuant to Regulation A. The proceeds
of our Offering will be used to construct and/or acquire Projects and to issue
Loans.
We
are offering to sell, and seeking offers to buy, the shares only in
jurisdictions where such offers and sales are permitted. You should rely only
on the information contained in this Offering Circular. We have not authorized
anyone to provide you with any information other than the information contained
in this Offering Circular. The information contained in this Offering Circular
is accurate only as of its date, regardless of the time of its delivery or of
any sale or delivery of our securities. Neither the delivery of this Offering
Circular nor any sale or delivery of our securities shall, under any
circumstances, imply that there has been no change in our affairs since the
date of this offering circular. This offering circular will be updated and made
available for delivery to the extent required by the federal securities laws.
The Company generates cash flow
in three ways: (i) payments from Projects, (ii) payments from Loans and (iii)
returns from investments (for example, interest gained from a money market
savings account from cash-on-hand) ("Company Investments"). Cash flow
will first be used to pay operating costs and expenses, including fees and
reimbursements payable to our General Partner (see "Our Operating Costs and
Expenses"). The remaining cash flow, if any, is distributed to the
Preferred Equity Investors and the General Partner in the following
order of priority:
·
First, a preferred return equal to a 6% IRR payable to Preferred Equity
Investors, as more fully described in the Authorizing Resolutions (the "Preferred
Return");
·
Thereafter, any additional cash flow will be split between the Preferred
Equity Investors and the General Partner such that 80% is distributed to
Preferred Equity Investors and 20% to the General Partner (the "Carried
Interest")
Be advised that only proceeds on
the interest, and not on the repayment of the principal, which the Company
receives from Loans and returns from Company Investments will be eligible for
distribution. Repayment of principal of either Loans or Company Investments
will not be eligible to be distributed to either the General Partner or the
Limited Partners (together, the "Partners") and will be available for
investment by the Company, in the General Partner's sole discretion.
See "Compensation of General
Partner" and "Calculating Distributions" for more detailed
information regarding fees and distributions payable to the General Partner.
Preferred Equity Investors have
no voting rights.
CAUTION: ALTHOUGH THE CASH FLOW
FROM OUR PROJECTS AND LOANS WILL LARGELY BE ESTABLISHED BY CONTRACT IN ADVANCE,
THERE IS NO GUARANTEE THAT OUR PROJECTS OR LOANS WILL GENERATE ANY POSITIVE
CASH FLOW.
BUYING CLASS
A INVESTOR SHARES IS SPECULATIVE AND INVOLVES SIGNIFICANT RISK, INCLUDING THE
RISK THAT INVESTORS COULD LOSE SOME OR ALL OF THEIR MONEY. THIS SECTION
DESCRIBES SOME OF THE MOST SIGNIFICANT FACTORS THAT THE COMPANY BELIEVES MAKE
AN INVESTMENT IN THE CLASS A INVESTOR SHARES RISKY. THE ORDER IN WHICH THESE
FACTORS ARE DISCUSSED IS NOT INTENDED TO SUGGEST THAT SOME FACTORS ARE MORE
IMPORTANT THAN OTHERS. You should
carefully consider the following risk factors in conjunction with the other
information contained in this offering circular before purchasing the CLASS
A INVESTOR SHARES.
Page 3
Risks Associated with
Renewable Energy Projects: The market for renewable energy is changing
rapidly. If renewable technology proves unsuitable for widespread commercial
deployment or if demand for renewable energy products, especially solar energy
products, fails to develop sufficiently, our Projects and Loans might not be
able to generate enough revenues to achieve and sustain profitability. The
factors influencing the widespread adoption of renewable energy technology
include but are not limited to: cost-effectiveness of renewable energy
technologies as compared with conventional technologies; performance and
reliability of renewable energy products as compared with conventional energy
products; and the success of other enabling technologies such as battery
storage and Distributed Energy Resource Management Systems ("DERMS").
The Investment Environment May
Change Over Time: The Company's investment in the Projects and Loans
is intended to extend over a period of years, during which the business,
economic, political, regulatory, and technology environment within which the
Company operates may undergo substantial changes, some of which may be adverse
to the Company. The General Partner will have the exclusive right and authority
(within limitations set forth in the LP Agreement) to determine the manner in
which the Company shall respond to such changes, and Limited Partners generally
will have no right to withdraw from the Company or to demand
specific modifications to the Company's operations in consequence thereof. A
major recession or adverse developments in the securities or credit markets
might have an impact on the Company's investments in the Projects and Loans. In
addition, factors specific to the Projects and Loans may have an adverse effect
on the Company.
Changes in the Solar
Investment Tax Credit Could Adversely Affect Our Business: The Solar
Investment Tax Credit ("ITC"), which is administered by the Internal
Revenue Service ("IRS"), allows qualified applicants to claim an amount equal
to 20% of the eligible cost basis for qualifying solar energy property. Any
changes to the laws or IRS guidance regarding ITC could materially and
adversely affect our business and financial results. Moreover, the legislative
agenda in Washington remains fluid, with the proposed "Big Beautiful Bill"
signaling potential structural changes to the ITC framework and other key
federal incentives. These developments are already causing some project
sponsors to delay financial closes or rework underwriting assumptions and may
ultimately slow the pace of greenfield development over the coming quarters.
Net
Losses: We are currently incurring net losses and may continue incurring
net losses in the future. If our operating expenses exceed our expectations,
our financial performance could be adversely affected. If our revenue does not
grow to offset these increased expenses, we may never become profitable. In
future periods, we may not have any revenue growth, or our revenue could
decline.
Distributions to Investors:
Whether to distribute operating cash flow or capital proceeds and how much to
distribute, is at the sole discretion of the General Partner. No returns are
guaranteed, and Investors will receive distributions only if the Company
generates distributable cash flow from the Projects and Loans. Investors will
not have any recourse in the event we are unable to pay distributions. Because
we have not made any profit to date and have no current or accumulated earnings
and profits, such cash, any such distributions to Investors will be considered
a return of capital for U.S. federal income tax purposes to the extent that the
distributions do not exceed the adjusted tax basis of the U.S. Holder's Class A
Investor Shares. See "Management Discussion and Analysis of Financial
Condition and Result of Operation-Distributions."
Distributions Generally:
Our ability to achieve our investment objectives and to pay distributions depends
upon the performance of our General Partner in the acquisition of our Projects
and Loans and the ability of our General Partner to source investment
opportunities for us. In the event we are unable to timely locate suitable
investments, we may be unable or limited in our ability to pay distributions,
and we may not be able to meet our investment objectives. If we pay
distributions from sources other than our cash flow from Projects and Loans, we
will have less funds available for investments and your overall return will be
reduced.
Competition: There are
many solar developers actively acquiring solar projects in the United States.
Some of which are multi-national independent power producers (such as
Brookfield and NextEra). In addition to these large established players, there
are several smaller developers the Company views as direct competition.
Aggressive pricing by competitors or the entrance of new competitors could
reduce the Company's profitability and ability to acquire and develop Projects
or to issue high-quality Loans.
Page 4
Our
Customers and/or Borrowers Might Default: The Company will have a variety
of Customers and Borrowers, including businesses, utility companies,
municipalities and schools. Some Customers could default. A default would hurt
the Project in question financially, reducing the anticipated returns to Investors.
Customers and Borrowers may face intense competition, changing business and
economic conditions, risks of technological acceptance and obsolescence or
other developments that may adversely affect their ability to pay. Within the
limitations set forth in the LP Agreement, the General Partner will have the
right and authority to cause the Company's investment management and
liquidation strategies and procedures to deviate from those described in this
Offering Circular.
We Might Own Only a Small
Number of Projects: If the Company is successful in raising the current
maximum offering amount of $50.0 million in this Offering, the Company would
likely acquire or invest in between 10 and 20 Projects. If the Company raises
significantly less than the maximum offering amount, it may not be able to
invest in as many Projects. If the Company owns only a small number of
Projects, Investors will be exposed to greater concentration risk.
Possible
Changes in Governmental Policies: The Projects depend on both state and
federal level energy policies. These policies could expire, phase-out over
time, require renewal by the applicable authority, or become a victim of
political pressure. The U.S. government and many states have instituted several
changes to their policies over the past several years. Some of those changes
have positively affected our business while others have had a negative impact.
The new policies could disfavor solar projects in general and our Projects in
particular.
Delays in
Connecting to Power Grid: The Projects must be physically connected to the
power grid, a process that involves sophisticated engineering and government
regulation. Delays are not uncommon. For example, the utility involved might be
required to perform physical upgrades to allow for the safe and consistent
generation, distribution, and/or transmission of electricity from a Project to
the grid. Delays in the performance of the interconnecting utility's
obligations to make such grid upgrades can negatively impact the financial
performance of the Company.
Operational
Risks: The Projects are subject to operating and technical risks, including
risk of mechanical breakdown, failure to perform according to design
specifications, labor and other work interruptions and other unanticipated
events that adversely affect operations. The success of each Project, once
built, depends in part upon efficient operations and maintenance.
Construction
and Development Risks: In some cases, the Company will invest in Projects
before construction is complete. Construction of any kind involves risk,
including labor unrest, bad weather, design flaws, the unavailability of
materials, fluctuations in the cost of materials, and labor shortages. Delays
are common, which could adversely affect the economics of the Company.
Equipment
Supply Constraints: The construction of renewable energy facilities relies
on the availability of certain equipment that may be in limited supply, such as
solar modules, trackers, inverters and monitoring systems. Much of this
equipment comes from China. There is no guarantee that the production of this
equipment will match demand and this may adversely impact the ability to
construct and the cost of the Projects.
Finding
Credible Development Companies and Projects: Attracting and retaining
relationships with Development Companies who can originate Projects with
quality Customers is critical to the success of the Company (see "Investment
Strategy"). If we are unable to acquire a large enough volume of quality
Projects, our revenues may be lower than projected.
Risks Upon Disposition of
Investments: If the Company sells a Project, it might be required to make
representations about the business and financial affairs of the Project, and to
indemnify the purchaser if those representations prove to be inaccurate or
misleading. These arrangements may result in contingent liabilities.
Regulatory
Risks: The Projects will be subject to extensive regulatory requirements,
including those imposed by U.S. environmental, safety, labor and other
regulatory and political authorities. These regulatory requirements may impose
substantial costs on the Projects or an SPE. Further, should any Project or SPE
fail to comply with one or more regulatory requirements, it could result in
substantial fines and penalties or a shutdown of the Project or SPE.
Unavailability
of Insurance Against Certain Catastrophic Losses: Certain losses of a
catastrophic nature, such as earthquakes, wars, terrorist attacks or other
similar events, may be either uninsurable or insurable at such high rates that
to maintain such coverage would cause an adverse impact on the related Project.
As a result, not all Projects may be insured against all possible risks. If a
major uninsured loss occurs, the Company could lose both the amount it invested
in and anticipated profits from the affected Projects.
Page 5
Potential
Environmental Liability: The Projects, like any large-scale physical plant,
could cause environmental contamination under some circumstances. Further, the
SPE could be found liable for environmental contamination that occurred before
the Project was built. The cost of remediation and penalties could be very
large.
Liability
for Personal Injury and Damage to Property: The Company could be held
liable for accidents and injuries at the Project site. The SPE will carry
insurance to protect against the potential losses, but the insurance might not
be adequate.
Global or National Economic
Conditions: An economic slowdown the U.S. or globally could affect our
Customers and therefore our Projects.
No
Participation in Management: Investors will have no voting rights and no
right to participate in the management of the Company or the Projects. Instead,
the General Partner will make all decisions. You will have the ability to
replace our management team only under very limited circumstances, as described
in "Summary of LP Agreement and Authorizing Resolution".
Reliance
on Management: The success of the Company and its Projects will depend in
part on the skills of our General Partner and its management team. If our
General Partner fails to retain its key personnel, the Company and its
Investors could suffer.
Sale of
Other Securities: The Company could, at any time, sell classes of Company
shares other than those being offered by this Offering, for example, in a
private placement (including, but not limited to, the sale of Reg D Shares). A
different class of securities could have greater rights than those associated
with the Class A Investor Shares, including but not limited to preferential
rights to distributions.
Limitations
on Rights in Investment Agreements: To purchase Class A Investor Shares,
you are required to sign an investment agreement, in the form attached hereto
and if you decide to invest over time or automatically reinvest your
distributions, you will be required to sign an additional investment agreement
(such investment agreements, the "Investment Agreements"). The
Investment Agreements will limit your rights in several important ways if you
believe you have claims against us arising from the purchase of your Class A
Investor Shares:
·
Any claims arising from your purchase of Class A Investor Shares must be
brought in the state or federal courts located in Wilmington, Delaware, which
might not be convenient to you.
·
You would not be entitled to recover any lost profits or special,
consequential, or punitive damages. However, that limitation does not apply to
claims arising under Federal securities laws.
Following your initial purchase
of Class A Investor Shares, you may to continue to participate in this Offering
by electing to either (i) establish with the Company, a plan for you to
automatically invest in the Offering on a periodic basis, subject to the terms
of an Auto-Invest Agreement signed by you and the Company or (ii) to reinvest
the distributions you receive from your Class A Investor Shares into the
purchase of additional Class A Investor Shares, subject to the terms and
conditions of the applicable Investment Agreement, signed by you and the
Company.
General Partner's Drag-Along
Rights: The General Partner may decide to sell the Projects or the Company
at any time. Should the General Partner decide to sell the Company, Investors
could be forced to sell their Class A Investor Shares at the direction of the
General Partner according to the General Partner's drag-along rights granted to
them in the LP Agreement (see "Summary of LP Agreement and Authorizing
Resolution").
Forum Selection Provision:
Our Investment Agreements and our LP Agreement both provide that disputes will
be handled solely in the state or federal courts located in the state of
Delaware. We included this provision primarily because (i) the Company is
organized under Delaware law, (ii) Delaware courts have developed significant
expertise and experience in corporate and commercial law matters and
investment-related disputes (which typically involve very complex legal
questions), particularly with respect to alternative entities (such as LPs),
and have developed a reputation for resolving disputes in these areas in an
efficient manner, and (iii) Delaware has a large and well-developed body of
case law in the areas of corporate and alternative entities law and
investment-related disputes, providing predictability and stability for the
Company and its Investors. This provision could be unfavorable to an Investor
to the extent a court in a different jurisdiction would be more likely to find
in favor of an Investor or be more geographically convenient to an Investor. It
is possible that a judge would find this provision unenforceable and allow an
Investor to file a lawsuit in a different jurisdiction.
Page 6
Section 27 of the Securities
Exchange Act of 1934 (the "Exchange Act") provides that Federal courts
have exclusive jurisdiction over lawsuits brought under the Exchange Act, and
that such lawsuits may be brought in any Federal district where the defendant
is found or is an inhabitant or transacts business. Section 22 of the
Securities Act provides that Federal courts have concurrent jurisdiction with
State courts over lawsuits brought under the Securities Act, and that such
lawsuits may be brought in any Federal district where the defendant is found or
is an inhabitant or transacts business. Investors cannot waive our (or their)
compliance with federal securities laws. Hence, to the extent the forum
selection provisions of the Investment Agreements or the LP Agreement conflict
with these Federal statutes, the Federal statutes would prevail.
Waiver of
Right to Jury Trial: The Investment Agreements and the LP Agreement both
provide that legal claims will be decided only by a judge, not by a jury. The
provision in the LP Agreement will apply not only to an Investor who purchases
Class A Investor Shares in the Offering, but also to anyone who acquires Class
A Investor Shares in secondary trading. Having legal claims decided by a judge
rather than by a jury could be favorable or unfavorable to the interests of an
owner of Class A Investor Shares, depending on the parties and the nature of
the legal claims involved. It is possible that a judge would find the waiver of
a jury trial unenforceable and allow an owner of Class A Investor Shares to
have his, her, or its legal claim decided by a jury. In any case, the waiver of
a jury trial in both the Investment Agreements and the LP Agreement do not
apply to claims arising under the federal securities laws.
Conflicts
of Interest: The interests of the Company and the General Partner could
conflict with the interests of Investors in a number of ways, including:
·
Our General Partner and its officers perform similar roles for other
entities that are affiliated with the General Partner and are not required to
devote all of their time and effort to the Company and are only required to
devote such time to our affairs as their duties require.
·
Our General Partner will receive fees based, in part, on the amount of
cash flow the Company generates. The General Partner might, therefore, have an
incentive to raise more capital and invest in more Projects and Loans than they
would otherwise, leading them to invest in borderline Projects and Loans.
·
The entire business of the General Partner consists of investing in
solar projects, including solar projects in the United States. There could be
conflicts between Projects they decide to invest in through the Company and
projects they invest in through other vehicles.
Risk of Failure to Comply with
Securities Laws: The Offering relies on an exemption from registration with
the SEC pursuant to Regulation A. If the Offering did not qualify for exemption
from registration under the Securities Act, the Company could be subject to
penalties imposed by the federal government and state regulators, as well as to
lawsuits from Investors.
No Market for the Class A
Investor Shares; Limits on Transferability: There is currently no
established market for the Class A Investor Shares. An Investor who wishes to
sell or otherwise transfer their Class A Investor Shares may be limited
because:
·
There will be no established market for the Class A Investor Shares,
meaning the Investor could have a hard time finding a buyer for its shares.
·
Although the Company offers a Redemption Plan, there is no guarantee
that an Investor who wants to sell his, her, or its Class A Investor will be
able to do so.
·
Class A Investor Shares may not be transferred without the Company's
consent, which we can withhold in our sole discretion. The Company also has a
right of first refusal to purchase any Class A Investor Shares proposed to be
transferred.
Page 7
Our General Partner reserves the
right to reject any Redemption Request for any reason or no reason or to amend
or terminate the Redemption Plan without prior notice. Therefore, you may not
have the opportunity to make a Redemption Request prior to a potential
termination of the Redemption Plan and you may not be able to sell any of your
Class A Investor Shares back to the Company pursuant to the Redemption Plan.
Moreover, if you do sell your Class A Investor Shares back to the Company
pursuant to the Redemption Plan, you may not receive the same price you paid
for the Class A Investor Shares being redeemed. In addition, pursuant to our
Redemption Plan, an Investor may only (a) have one outstanding Redemption
Request at any given time and (b) request that we redeem up to $50,000 worth of
Class A Investor Shares per each Redemption Request.
For more information regarding
the Redemption Plan see "Redemption Plan".
"Best efforts-no minimum"
offering. The Offering is a "best efforts" basis and does not require a
minimum amount to be raised. This means that any investment made could be the
only investment in this Offering, leaving the Company without adequate capital
to pursue its business plan. If we are not able to raise sufficient funds, we
may not be able to fund our investment strategy as planned, and our growth
opportunities may be materially adversely affected. This could increase the
likelihood that an investor may lose their entire investment.
Corporate Governance Risk:
As a non-listed company conducting an exempt offering pursuant to Regulation A,
the Company is not subject to a number of corporate governance requirements
that an issuer conducting a registered offering or listed on a national stock
exchange would be. For example, the Company does not have (i) a board of
directors of which a majority consists of "independent" directors under the
listing standards of a national stock exchange, (ii) an audit committee
composed entirely of independent directors and a written audit committee
charter meeting a national stock exchange's requirements, (iii) a
nominating/corporate governance committee composed entirely of independent
directors and a written nominating/corporate governance committee charter
meeting a national stock exchange's requirements, (iv) a compensation committee
composed entirely of independent directors and a written compensation committee
charter meeting the requirements of a national stock exchange, and (v)
independent audits of the Company's internal controls.
The Company is an "Emerging
Growth Company" Under the JOBS Act: Today, the Company qualifies as an
"emerging growth company" under the JOBS Act of 2012. If the Company were to
become a public company (e.g., following a registered offering of its
securities) and continued to qualify as an emerging growth company, it would be
able to take advantage of certain exemptions from the reporting requirements
under the Exchange Act and exemptions from certain investor protection measures
under the Sarbanes Oxley Act of 2002. Using these exemptions could benefit the
Company by reducing compliance costs but could also mean that Investors receive
less information and fewer protections than they would otherwise. However,
these exemptions - and the status of the Company as an "emerging growth
company" in the first place - will not be relevant unless and until the Company
becomes a public reporting company.
The Company has elected to delay
complying with any new or revised financial accounting standard until the date
that a company that is not an "issuer" (as defined under Section 2(a) of the
Sarbanes-Oxley Act of 2002) is required to comply with such new or revised
accounting standard, if such standard also applies to companies that are not
issuers. As a result, owners of Class A Investor Shares might not receive the
same disclosures as if the Company had not made this election.
For example, because we are an
emerging growth company, you will not be able to depend on any attestation from
our independent registered public accounting firm as to our internal control
over financial reporting for the foreseeable future. Our independent registered
public accounting firm will not be required to attest to the effectiveness of
our internal control over financial reporting pursuant to Section 404 of the
Sarbanes-Oxley Act until the later of the year following our first annual
report required to be filed with the Commission or the date we are no longer an
"emerging growth company" as defined in the JOBS Act. Accordingly, you will not
be able to depend on any attestation concerning our internal control over
financial reporting from our independent registered public accounting firm for
the foreseeable future.
Breaches
of Security: It is possible that our Platform, systems or the systems of
third-party service providers could be "hacked," leading to the theft or
disclosure of confidential information Investors provide to us. Because
techniques used to obtain unauthorized access or to sabotage systems change
frequently and generally are not recognized until they are launched, the
Company, General Partner and our service providers may be unable to anticipate
these techniques or to implement adequate defensive measures.
Page 8
Unanticipated changes in our
tax laws that may impact us, the enactment of new tax legislation, or exposure
to additional income tax liabilities could affect our profitability: We are
obligated to comply with income tax laws in the regions where we operate,
including recent changes like the Inflation Reduction Act. These evolving tax
regulations could impact our financial health. We also face potential tax
audits that may result in additional tax assessments, with uncertain outcomes.
Changes to our effective tax rate, driven by shifts in our operational
structure, could have significant effects on our financial well-being.
The price of Class A Investor
Shares was determined by our General Partner (see "Price of Class A Investor
Shares"). The Company sells shares to raise capital for the purchase and
construction of Projects and to issue Loans. As new Investors purchase Class A
Investor Shares (or other classes of stock, see "Other Concurrent Offerings"),
existing Investors may be temporarily diluted until new Projects are acquired
and/or constructed and new Loans are originated and contribute to monthly cash
flow. Cash in treasury may be invested into Company Investments to optimize
yield and minimize the dilution impact. Such Company Investments will not earn
as high of a return as we expect to earn on our investments in Projects and
Loans.
Additionally, we may in the
future offer additional classes and/or series of Investor Shares (such as in
the Reg D Offering) or other securities convertible into or exchangeable for
such class or series of Investor Shares. Although no assurances can be given
that we will consummate a financing, in the event we do, or in the event we
sell additional classes and/or series of Investor Shares (such as in the Reg D
Offering) or other securities convertible into shares of our Class A Investor
Shares in the future, additional and substantial dilution will occur. In
addition, investors purchasing Class A Investor Shares or other securities in
the future could have rights superior to Class A Investor Shares Investors in
this Offering. Subsequent offerings at a lower price (a "down round") could
result in additional dilution.
The Company is offering to sell
up to $50,000,000 of Class A Investor Shares to the public. This Offering is
being conducted as a continuous offering pursuant to Rule 251(d)(3) of
Regulation A, meaning that while the offering of securities is continuous,
active sales of securities may happen sporadically over the term of the
Offering. Further, the acceptance of subscriptions, whether via the Platform or
otherwise, may be briefly paused at times to allow us to effectively and
accurately process and settle subscriptions that have been received.
The Offering will commence as
soon as this offering statement is "qualified" by the SEC and will end on the
sooner of (i) a date determined by the Company, or (ii) the date the Offering
is required to terminate by law.
Only the Company is offering
securities in this Offering. None of our existing officers, directors, or
stockholders are offering or selling any of their securities of the Company in
this Offering.
The Company is not using an
underwriter or broker to sell the Class A Investor Shares and is not paying
commissions. Class A Investor Shares will be offered and sold only through the
Platform.
This is a "best efforts - no
minimum" offering. This means that the Offering does not have a minimum
threshold amount that we must raise before we can have a closing. Even if a
very small number of Class A Investor Shares are sold, the Company does not plan
to return funds to Investors.
The Company reserves the right to
reject any subscription to purchase Class A Investor Shares in this Offering in
whole or in part and for any reason (or no reason). If the Company rejects an
investment, it will promptly return all the Investor's money without interest
or deduction.
Anyone can buy Class A Investor
Shares. The General Partner does not intend to limit investment to people with
a certain income level or net worth, although there are limits on how much
non-accredited investors may invest in this Offering (see "Limit on the
Amount a Non-Accredited Investor Can Invest").
Page 9
After the Offering has been
"qualified" by the SEC, the General Partner intends to advertise the Offering
using the Platform and through other means, including public advertisements,
social media and audio-visual materials, in each case, only as we authorize and
in compliance with the rules and regulations of Regulation A. Although these
materials will not contain information that conflicts with the information in
this Offering Circular and will be prepared with a view to presenting a
balanced discussion of risk and reward with respect to the Class A Investor
Shares, the advertising materials will not give a complete understanding of
this Offering, the Company, or the Class A Investor Shares and are not to be
considered part of this Offering Circular.
The Offering is made only by
means of this Offering Circular and prospective Investors must read and rely on
the information provided in this Offering Circular in connection with their
decision to invest in Class A Investor Shares.
In
addition to this Regulation A offering, the Company may conduct concurrent
private offerings of securities under Rule 506(c) of Regulation D of the
Securities Act of 1933. These private offerings (the "Reg D Offerings")
will be open exclusively to verified accredited investors and may be offered
through general solicitation and advertising, in compliance with applicable
securities laws. Each of these classes of Company shares ("Reg D Shares")
offered to investors participating in these private offerings (the "Reg D
Investors") shall participate in distributions with the Investors on a pari
passu basis.
Securities
sold pursuant to Regulation D will not be registered with the SEC and will be
subject to transfer restrictions. The Regulation D offering will sell different
classes of stock in the Company, but other terms of investment (including the
price for a share and fees paid to the General Partner) will be identical
across the offerings with one exception: while Investors are subject to a 5%
marketing reimbursement back to the General Partner, Reg D Investors will
instead pay a similar expense to broker-dealers and registered investment
advisors.
Proceeds from the Regulation D
offering will be combined with proceeds from this Offering and used by the
Company for the same common purpose (see "Use of Proceeds").
We expect to use all of the net
proceeds of this Offering, after marketing expenses, to acquire, develop and
construct Projects and to issue Loans. Proceeds waiting to be invested into
Projects and Loans may be invested into short-term investment products like
government bonds or money market accounts. The Company expects to use Offering
proceeds first to fund construction of current Projects, then to fund new
Projects and Loans. For more information regarding our investment strategy, see
"Description of Business-Investment Strategy". For more information
regarding current Projects and Loans, see "Description of Property".
We expect to pay for operating
expenses at the Company with cash flow from the Projects and Loans, but if the
Projects and Loans have not earned enough revenue to pay for any given
operating expense, the General Partner may use the proceeds from this Offering
to pay such operating expense. The types of operating expenses at the Company
level are described in "Our Operating Costs and Expenses".
The capital raised in this
Offering will not be used to compensate officers or directors because the
Company has no employees. However, Offering proceeds will be used to pay fees
owed to the General Partner and its affiliates (see "Compensation of General
Partner"). The Company does not expect to pay
fees to the General Partner from the proceeds of the Offering. Fees are instead
expected to be paid with revenue produced by the Projects, Loans and Company
Investments. However, it is possible that the revenue would be insufficient to
pay management fees, at which time, fees may be paid for from the proceeds of
this Offering.
The General Partner may make
short term advances to the Company to make payments on an as-needed basis. The
General Partner has also secured a loan on behalf of the Company. We do not
anticipate any additional sources of capital apart from funds from operations,
the advances, funds generated through this Offering (and other concurrent
offerings) and the loan to fund the Projects and Loans and to cover marketing
expenses.
Page 10
It is important to note that no
capital will be allocated to any Project or Loan until it has received formal
approval from the Investment Committee and has been reported in accordance with
the appropriate procedures (see "Investment Committee").
We might invest in Projects or
Loans using the General Partner's capital before we have raised enough capital
from Investors. In that case, we will replace the General Partner's capital
with capital from Investors as soon as we raise it. To the extent the General
Partner or its affiliates invest capital, they will do so on the same price and
terms as other Investors (see "Compensation of General Partner").
The table below sets forth our
estimated use of proceeds from this Offering assuming we sell $50.0 million in
Class A Investor Shares. This is a "best effort" offering. This Offering
does not have a minimum to close. The Company is not paying commissions to
underwriters, brokers, or anyone else in connection with the sale or
distribution of the Class A Investor Shares. In some cases, retirement
custodians, investment advisers, and other intermediaries will offer to invest
on behalf of their clients. In such cases, the custodian, adviser, or
intermediary will be paid a fee from their client's invested funds. In such
cases, the client (rather than the Company) is paying those fees.
|
|
|
Maximum
Offering
|
|
10% of Maximum
|
|
25% of Maximum
|
|
50% of Maximum
|
||||
|
|
|
Amount (1)
|
|
Amount
|
|
Amount
|
|
Amount
|
||||
|
Gross Offering Proceeds
|
|
$
|
50,000,000
|
|
|
5,000,000
|
|
|
12,500,000
|
|
|
25,000,000
|
|
Less: Marketing Expenses1
|
|
$
|
2,500,000
|
|
|
250,000
|
|
|
625,000
|
|
|
1,250,000
|
|
Net Proceeds from this Offering
|
|
$
|
47,500,000
|
|
|
4,750,000
|
|
|
11,875,000
|
|
|
23,750,000
|
|
Estimated Amount Available for New Projects and Loans
|
|
$
|
47,500,000
|
|
|
4,750,000
|
|
|
11,875,000
|
|
|
23,750,000
|
|
TOTALS
|
|
$
|
50,000,000
|
|
|
5,000,000
|
|
|
12,500,000
|
|
|
25,000,000
|
|
(1) The Company will reimburse
the General Partner in an amount up to 5% of proceeds from this Offering to
pay for organization and offering expenses, including marketing expenses. Any
such amounts in excess of such 5% will be paid, without reimbursement, by the
General Partner.
|
||||||||||||
The Company reserves the right to
change the above use of proceeds without notice if the General Partner believes
it is in the best interests of the Company.
The Company's offices are located
at 52 Main Street, Chester, CT 06412. The Company itself has no employees.
Rather, the Company has engaged the General Partner to manage the Company and
utilizes employees and services provided by the General Partner as described
more fully in the section "Directors, Executive Officers & Significant
Employees".
Energea Portfolio 4 USA LP is a limited
partnership, treated as a "C" corporation for United States federal and state
income tax purposes, and organized under the laws of Delaware as of March 11,
2021. The Company and its day-to-day operations are managed by Energea Global
LLC (the "General Partner" or "Energea Global"). The Company was
created to invest in the acquisition, development, and operations of solar
energy projects in the USA (each a "Project"). The Company may also lend
money to Development Companies and use solar projects as collateral rather than
acquiring Projects for direct ownership (each a "Loan").
Page 11
The primary sources of revenue
for the Company comes from payments made by customers who buy energy from the
Projects ("Customers") and borrowers who make principal and interest
payments on Loans ("Borrowers"). The Company's profitability depends on
generating revenues from Projects and Loans that exceed the operating costs
(see "Our Operating Costs and Expenses").
Projects are each owned by a
special-purpose entity ("SPE"). As of the date of this Offering
Circular, the Company owns 100% of each SPE (except for Tax Equity, as
hereinafter defined), although there could be instances where the Company is a
partner in a SPE with another party. In all cases, the Company expects to
exercise management control over each SPE.
The Company generally plans to
hold the Projects indefinitely, creating a reliable stream of cash flow for
Investors. Should the Company decide to sell Projects in the future, however,
the General Partner would consider the following factors:
·
Yield and Cashflow: Many investment funds look for reliable
cashflows generating a targeted yield. With both revenue and most expenses
locked in by contract, the cash flow from any Project should be predictable and
consistent for as long as 25 years.
·
Project Consolidation: Some of the Projects will be too small or
unusual for institutional buyers to consider purchasing on their own. The
Company could package these Projects into a larger, more standardized portfolio
that will be attractive to these larger, more efficiency-focused players. In
the aggregate, a portfolio of Projects might be expected to generate 50+
megawatts of power with relatively uniform power contracts, engineering
standards, and underwriting criteria. A portfolio of that size can bear the
fees and diligence associated with an institutional-grade transaction or
securitization.
·
Cash Flow Stabilization: When the Company buys a Project, it will
typically share the construction or repowering risk with the Development
Company that originated the Project. Larger investors are generally unwilling
to take on construction risk and will invest only in Projects that are already
generating positive cash flow, referred to as "stabilization". Thus, the
Company may acquire Projects before stabilization and sell them after
stabilization. Institutional investor interest in the Portfolio should increase
as the portfolio stabilizes.
·
Increase in Residual Value: When the Company acquires a Project,
the appraisal is based solely on the cash flows projected from executed Power
Purchase Agreement (see "Summary of Supporting Contracts"), with no
residual value assumed for the Project. There is a high probability that a
Project will continue to create revenue after its initial contract period in
the form of a contract extension, repositioning, or sale of energy into the
merchant energy markets. This creates a sort of built-in "found value" for our
Projects, which may be realized upon sale.
The Company sources most of its
Projects from third parties in the United States who specialize in developing
solar projects ("Development Companies"). The Company's relationship
with Development Companies may take several different forms. A Development
Company might: (i) identify a potential project and permit, engineer and
construct it, (ii) provide operations and maintenance support for a Project
after it is built, or (iii) sell a Project to us and exit entirely.
Development Companies are
compensated for their work and their risk. As of the date of this Offering
Circular, the General Partner does not currently own a Development Company in
the U.S. and the Company acquires all Projects from unrelated Development Companies.
The General Partner may create or acquire a Development Company if Projects
from third parties become overpriced, if an exceptional market opportunity
presents itself or if deal flow is slow and we require additional development
capacity. If the Company were to acquire a Project from a Development Company
that is related to the General Partner or an affiliate of the General Partner,
we will cap the related-party origination fee at 5.0% of the overall Project's
cost, which we believe is below the standard market rate for developing a
Project (see "Compensation of General Partner").
The General Partner reviews
Projects submitted by the Development Companies and seeks to identify Projects
that we believe represent the greatest opportunity for risk-adjusted returns.
We are specifically searching for Projects in states with what we believe to be
favorable economic conditions, large addressable markets and well-defined
renewable energy policies, like Connecticut, New York, Massachusetts and
California. When we find a Project that meets these fundamental criteria, we
consider the Project for investment and attempt to negotiate a Project Purchase
and Sale Agreement (see "Summary of Supporting Contracts"), allowing the
Company to take ownership of the Project.
Page 12
The Company is particularly
focused on investing in Projects that have been operational for at least five
years, because we believe that these seasoned assets are more predictable and
buying them at this stage helps the Company avoid the complexity and expenses
related to tax equity project finance (a form of investment typical at the
beginning of a project's life in the U.S. solar market). We believe there are a
large number of small to medium-scale solar projects in the U.S. that are aging
and could be acquired for attractive prices.
We primarily invest in Projects
with the following characteristics:
·
Power Capacity: We intend to focus on Projects of between 0.1
megawatts and 10 megawatts, although we may pursue larger projects if the right
opportunity presents itself. (NOTE: The capacity of a solar project is
determined in accordance with "standard testing conditions" established by
certain laboratories worldwide. The actual output of a solar project fluctuates
with solar irradiance.)
·
Locations: We select locations based primarily on:
o Demand for alternative energy;
o Efficient access for maintenance;
o Interconnection points with the
electricity grid;
o Solar irradiance; and
o State-level policies that enable
the development of renewable energy projects.
·
Right to Land: Some Projects owned by the Company will be installed
on Customer's rooftops, while others will be located on remote parcels of real
estate. In either scenario, the Company, and more specifically, the SPE, will
obtain rights to access the Project ("Access Rights") to construct and
maintain the Project. For rooftop Projects, Access Rights are most commonly
granted through the Power Purchase Agreement with the Customer. For Projects on
remote real estate, the SPE will either purchase or lease the site to ensure adequate
Access Rights are protected.
·
Connecting Projects to the Distribution Grid: All Projects
acquired or constructed by the Company will require permission to interconnect
to the local electric grid. This permission is granted by the local
interconnecting utility company through an Interconnection Agreement and an
associated Permission to Operate.
·
Our Solar Equipment: Generally, we use the same basic equipment
that is used across the solar industry: the solar panels themselves, which turn
sunlight into electrical energy, and the inverters, which convert the direct
current from the panels to the alternating current used in homes and
businesses. However, we buy our equipment only from certain manufacturers who
we believe are known for high quality and financial strength.
·
State-Level Incentives and Environmental Commodities: Many states
in the United States have certain incentives to promote the development of
renewable energy projects. There is a wide range of state-level incentives that
include an environmental commodity known as renewable energy credits ("RECs"),
property and sales tax exemptions, net metering and community solar. The
Company will seek to optimize those state-level incentives in order to increase
the expected return on investment for Investors which may include transactions
with third parties to monetize the RECs.
·
Tax Incentives: In addition to state-level incentives, the
federal government of the United States has created multiple tax-related
incentives to promote the development of renewable energy projects. The
incentives include the Investment Tax Credit ("ITC") and Modified
Accelerated Cost Recovery System ("MACRS") accelerated depreciation and
bonus depreciation. The Company will seek to optimize those federal-level
incentives in order to increase the expected return on investment for Investors
which may include transactions with third parties for the purpose to monetizing
certain tax advantages ("Tax Equity").
·
Minimum Technical Requirements ("MTR"): All technical
aspects of each Project we invest in must meet the Company's MTR. The MTR is a
comprehensive list of all venders and equipment makes/models which have gotten
through the General Partner's due diligence process and are acceptable for use
in the Projects. We analyze venders and the equipment they make to predict the
field performance of the equipment and the financial strength behind warranties
and guarantees. In addition to tracking venders and materials used in the
construction, we also track best installation practices through the MTR. Each
Project leaves lessons learned, and those lessons are incorporated into the
collective memory of the General Partner by being added to the best practices
component of the MTR.
Page 13
·
When the Company Invests in Projects: Normally, the Company will
not invest in a Project until the applicable contracts named above in Rights
to Land, Connecting Projects to the Distribution Grid, and Our Solar
Equipment have been negotiated and executed. Thus, in most
cases Investors are not exposed to significant Project-level risks until all
these agreements are signed. However, the General Partner might make exceptions
for Projects which we believe to be exceptionally promising. The General Partner
will have sole discretion over whether to acquire or invest in a Project. See "Risk
Factors" for more information.
The
Company may provide Loans to Borrowers in the United States. Borrowers are
usually Development Companies or a project SPE owned by a Development Company.
These Loans are designed to finance the development of new solar energy
projects while relying on the credit of existing projects or other collateral
that rests on the balance sheet of the Borrower as collateral. Each time a
new project reaches commercial operation; it contributes to the Borrower's
overall collateral which allows the Company to extend additional credit to the
Borrower.
· Loan Issuance: As the
Company raises capital through this Offering, the General Partner may lend some
or all of it to Borrowers each month. Each disbursement is amortized on a
separate amortization schedule which adheres to the terms and conditions of the
Loan Agreement (see "Summary of Supporting Contracts").
· Collateral: The Loans
are senior debt and collateralized by a pledge of the shares in the Borrower's
enterprise which includes solar projects held on the corporate balance sheet.
Thus, by serving as the sole lender to a Borrower, the solar projects act as
the primary form of collateral. As Loans are issued, the Borrower uses the loan
proceeds to develop and construct more projects which are added to the overall
collateral calculations.
As the Projects achieve commercial operation, the
Borrower's customer begins to make payments to our Borrower for energy produced
by the Projects. In some cases, payments from the customers to our Borrower are
made directly to a segregated account controlled by the Company. As a condition
to close a Loan, the Borrower grants the Company controlling rights to the
trust account and/or collateralized assets so that, in the event of a default,
the General Partner can easily step into the Borrower's cash flow to prevent
revenue leakage during a default event. We believe the Company is
particularly well-suited to issue Loans when solar projects act as collateral
due to our General Partner's extensive experience owning and operating solar
projects.
· Loan Management: The
General Partner will oversee the performance and compliance of Borrowers and
the associated collateral. Their responsibilities include continuous monitoring
of construction progress, energy production and cash flows to help ensure that
loan terms are met. By working closely with the Borrowers and their projects,
we mitigate risks associated with project delays and underperformance which
could impair the Borrower. Close scrutiny of underlying projects during due
diligence and loan servicing also ensures an efficient step-in during a default
scenario.
The ITC, a foundational element
of U.S. renewable energy policy, was significantly restructured through the
Inflation Reduction Act of 2022 ("IRA") and subsequent regulatory
developments. Historically, the ITC allowed renewable energy
developers-particularly in solar and wind-to claim a federal tax credit based
on a percentage of project capital expenditures. This credit was used to offset
the developer's tax liability, reducing effective project costs and
incentivizing investment. However, the previous framework posed challenges for
entities without sufficient tax appetite, requiring them to engage in complex
and expensive tax equity structures such as partnership flips or
sale-leasebacks, which often excluded smaller sponsors due to scale and cost
constraints.
Page 14
The IRA introduced a major change
by making ITCs transferrable, allowing project sponsors like our SPEs to sell
unused tax credits to unrelated third parties for cash. We believe that this
change addresses one of the key inefficiencies in the original structure by
opening access to the value of tax credits regardless of the sponsor's own tax
capacity which should result in a more flexible and efficient path to
monetizing tax incentives, improving capital recycling, and enabling broader
participation in renewable energy finance. Recent IRS guidance has further
clarified implementation of this provision, including registration requirements
and anti-abuse rules, which should further enable a growing market of tax
credit buyers and sellers to transact with greater certainty. The Company
expects to benefit from improved pricing, reduced transaction costs, and the
ability to monetize credits at the individual project level rather than relying
exclusively on aggregated or institutional-scale tax equity transactions.
However, it is important to note
that the tax credit regime remains subject to change, and future legislation
could materially alter the structure, availability, or value of the ITC. In
particular, the sweeping federal legislative package currently under
discussion-commonly referred to as the "Big Beautiful Bill"-is rumored to
include substantial changes to U.S. energy tax policy. While the precise
contents and timeline of such legislation remain uncertain, there is a risk
that it could modify or limit the transferability of credits, introduce new
eligibility requirements, or impose additional constraints on credit buyers or
sellers. These potential changes could impact the Company's ability to have its
SPEs monetize tax credits as anticipated and may cause our investment strategy
to focus exclusively on acquiring operational projects which are no longer
impacted by ITC considerations.
When we find a Project or Loan
that meets the fundamental criteria described above, we consider the
opportunity at a multi-disciplinary committee of experienced renewable energy
executives of the General Partner ("Investment Committee"). To approve a
Project or Loan for funding, a unanimous approval of the investment by the Investment
Committee is required to move forward. A copy of the memorandum prepared by the
General Partner for each Project or Loan is provided to Investors on the
Platform and in our filings with the SEC through Form 1-U and 253(g)(2)
filings. As of the date of this Offering Circular, the Investment Committee
consists of the members outlined in the table below:
|
Name
|
Title
|
Due Diligence
Responsibility
|
|
Arthur
Issa /
Daniel
Chavez
|
Financial Analyst
|
Review
historical financials and prepare projections for each Project and Loan
incorporating cash flow, tax, technical and energy market variables.
|
|
Dave Rutty
|
Project Analyst
|
Compiles the IC Memos for
Projects.
|
|
Francielle
Assis
|
HR & HSEC Legal Coordinator
|
Examines
the area where a Project is located for environmental, crime and
community-related risk factors.
|
|
Isabella Mendonca
|
General Counsel
|
Examine and/or prepares all
documents related to a Project or Loan to ensure contracts meet Energea
Global's requirements.
|
|
Juan
Carvajales
|
Loan Analyst
|
Compiles
the IC Memo for Loans.
|
|
Julio Cezar dos Santos de Morais
|
Electrical Engineer
|
Ensures all Projects meet our Minimum
Technical Requirements in the field. Produces a punch list of failures to be
remedied if necessary.
|
|
Mike
Silvestrini
|
Managing Partner
|
Originate
and negotiate deal flow and diligence the counterparties and their
operational quality for all Projects and Loans.
|
|
Paulo Vieira
|
Director of Operations & Maintenance
|
Confirms cost and strategy for
operating and maintaining Project investments.
|
Our net income depends, in large
part, on our ability to source, acquire and manage investments with attractive
risk-adjusted yields. We compete with many other entities engaged in renewable
energy in the U.S. market, including individuals, corporations, private funds,
and other entities engaged in renewable energy investment activities, many of
which have greater financial resources and lower costs of capital available to
them than we have. In addition, there are numerous companies with asset
acquisition objectives similar to ours, and others may be organized in the
future, which may increase competition for the investments suitable for us.
Page 15
Competitive variables include
market presence and visibility, amount of capital to be invested per Project
and underwriting standards. To the extent that a competitor is willing to risk
larger amounts of capital in a particular transaction or to employ more liberal
underwriting standards when evaluating potential investments than we are, our
investment volume and profit margins could be impacted. Our competitors may
also be willing to accept lower returns on their investments and may succeed in
buying the Projects that we have targeted for acquisition. Although we believe
that we are well-positioned to compete effectively in each facet of our
business, there is enormous competition in the market and there can be no
assurance that we will compete effectively or that we will not encounter
increased competition in the future that could limit our ability to grow the
portfolio in the future and conduct our business effectively.
The revenue from our Projects and
Loans consists primarily of the payments we receive from Customers and
Borrowers under their respective agreements. For the fiscal years ended
December 31, 2024 and 2023, respectively, the Company's total revenue was $329,680
and $189,884, respectively, which is broken down below:
|
Revenue Recognition
|
Amount as of
12/31/2024
|
Amount as of
12/31/2023
|
|
Project Revenue
|
$329,680
|
$189,884
|
|
Loan Revenue
|
$0
|
$0
|
In addition to the revenue
described above, the company may also earn additional income from short term
treasury investments and gains from the sale of a Project. For the fiscal years
ended December 31, 2024 and 2023, respectively, the Company's total other
income was $25,166 and $4,589, respectively, which is broken down below:
|
Other Income Recognition
|
Amount as of
12/31/2024
|
Amount as of
12/31/2023
|
|
Short Term Investments
|
$25,166
|
$4,589
|
|
Sale of Projects
|
$0
|
$0
|
Our Revenue Recognition Policy
follows ASC-606 which is a five-step procedure:
|
Procedure
|
Example
|
|
Step 1 - Identify the Contract
|
Power Purchase Agreement or Loan
Agreement
|
|
Step 2 - Identify the Performance Obligations
|
Delivery of electricity from solar plant or issuance of
debt
|
|
Step 3 - Determine the
Transaction Price
|
Amount contractually signed with
Customer or Borrower
|
|
Step 4 - Allocate the Transaction Price
|
Obligation is satisfied by transferring control of the
electricity produced to the Customer
|
|
Step 5 - Recognize Revenue
|
At a point in time when the
Customer or Borrower is invoiced
|
The Company incurs a variety of
costs and expenses, including:
·
banking fees;
·
legal expenses;
·
payments to the General Partner for fees;
·
payments to U.S. states to comply with their respective securities law
("Blue Sky Laws");
·
debt service and transactional payments (where we borrow money at the
Company level);
·
annual financial audit expenses;
·
depreciation; and
·
U.S. taxes.
Page 16
The Projects also incur a variety
of costs and expenses, including:
·
payments to third parties to operate and maintain the Projects;
·
lease payments to landowners (if applicable);
·
debt service and transactional payments (where we borrow money at the
Project level);
·
utilities;
·
property taxes;
·
banking fees;
·
taxes levied on SPEs;
·
depreciation; and
·
Project insurance.
The Company's total operating expenses
for the fiscal year ended December 31, 2024 were $315,129.
This PQA is not providing, or
purporting to provide, any tax advice to Investors. Every potential
Investor is advised to seek the advice of his, her or its own tax professionals
before making this investment. The securities sold in this Offering may have
issues related to taxation at many levels, including tax laws and regulations
at the state, local and federal levels in the United States, and at all levels
of government in non-U.S. jurisdictions.
It is impractical to comment on
all aspects of federal, state, local and foreign tax laws that may affect the
tax consequences of participation in the Company. Therefore, each prospective
Investor should satisfy himself, herself or itself as to the tax consequences
of participating in the Company by obtaining independent advice from his, her
or its own tax advisers. Furthermore, while the Company will furnish to you any
information required to be provided to you under applicable tax laws,
preparation and filing of each Investor's tax returns shall be such Investor's
responsibility.
The following summarizes certain
significant Federal income tax consequences of acquiring Class A Investor
Shares. This summary is based on the current tax laws in the U.S. Internal
Revenue Code of 1986, as amended (the "Code"), the Treasury regulations
issued by the Internal Revenue Service ("Regulations"), and current
administrative rulings and court decisions, all as they exist today. All of
these tax authorities could change in the future (and such change may possibly
be retroactive so as to result in different U.S. federal income tax
consequences from those set forth below).
This is only a summary,
applicable to a generic Investor. Your personal situation could differ. We
encourage you to consult with your own tax advisor before investing.
Page 17
As used herein, the term "U.S.
Holder" means a beneficial owner of the Class A Investor Shares that is,
for U.S. federal income tax purposes, an individual citizen or resident of the
United States, a corporation (or any other entity taxable as a corporation for
U.S. federal income tax purposes) created or organized in or under the laws of
the United States or any state or political subdivision thereof or the District
of Columbia, an estate the income of which is subject to U.S. federal income
taxation regardless of its source, or a trust, if a court within the United
States is able to exercise primary supervision over the administration of the
trust and one or more U.S. persons control all of the substantial decisions of
the trust or if a valid election is in place to treat the trust as a U.S.
person.
In addition, if a partnership, including any entity or
arrangement, domestic or foreign, classified as a partnership for United States
federal income tax purposes, holds Class A Investor Shares, the tax treatment
of a partner generally will depend on the status of the partner and upon the
activities of the partnership. Accordingly, partnerships that hold Class A
Investor Shares, and partners in such partnerships, should consult their tax
advisors.
The Company is a Delaware limited
partnership but has affirmatively elected to be treated as a corporation under
Subchapter C of the Code for federal income tax purposes. Thus, the
Company will be taxed at regular corporate rates on its income before making
any distributions to holders of Class A Investor Shares as described
below.
Distributions to U.S. Holders out
of the Company's current or accumulated earnings and profits, if any, will be
taxable as dividends. A non-corporate U.S. Holder who receives a distribution
constituting "qualified dividend income" may be eligible for reduced federal
income tax rates. U.S. Holders are urged to consult their tax advisors
regarding the characterization of corporate distributions as "qualified
dividend income." Dividends received by a corporate U.S. Holder may be eligible
for the corporate dividends-received deduction if certain holding periods are
satisfied. Distributions in excess of the Company's current and accumulated
earnings and profits will not be taxable to a U.S. Holder to the extent that
the distributions do not exceed the adjusted tax basis of the U.S. Holder's
Class A Investor Shares. Rather, such distributions will reduce the adjusted
basis of such U.S. Holder's Class A Investor Shares. Distributions in excess of
current and accumulated earnings and profits that exceed the U.S. Holder's
adjusted basis in its Class A Investor Shares will be taxable as capital gain
in the amount of such excess if the Class A Investor Shares are held as a
capital asset. In addition, Section 1411 of the Code imposes on individuals,
trusts and estates a 3.8% tax on certain investment income (the "3.8% NITT").
Upon any taxable sale or other
disposition of Class A Investor Shares, a U.S. Holder will recognize gain or
loss for federal income tax purposes on the disposition in an amount equal to
the difference between the amount of cash and the fair market value of any
property received on such disposition; and the U.S. Holder's adjusted tax basis
in the Class A Investor Shares. A U.S. Holder's adjusted tax basis in the Class
A Investor Shares generally equals his or her initial amount paid for the Class
A Investor Shares and decreased by the amount of any distributions to the
Investor in excess of the Company's current or accumulated earnings and
profits. In computing gain or loss, the proceeds that U.S. Holders receive will
include the amount of any cash and the fair market value of any other property
received for their Class A Investor Shares, and the amount of any actual or
deemed relief from indebtedness encumbering their Class A Investor Shares. The
gain or loss will be long-term capital gain or loss if the Class A Investor
Shares are held for more than one year before disposition. Long term capital
gains of individuals, estates and trusts currently are taxed at a maximum rate
of 20% (plus any applicable state income taxes) plus the 3.8% NIIT.
The Code imposes an alternative
minimum tax on individuals and corporations. Certain items of the Company's
income and loss may be required to be taken into account in determining the
alternative minimum tax liability of Investors.
Page 18
The Company will report its
income and losses using the calendar year.
The Company will furnish each
Investor with the information needed to be included in his or her federal
income tax returns, if any; provided, however, the Investors shall be
responsible for determining their adjusted basis in their respective Class A
Investor Shares. Each Investor is personally responsible for preparing and
filing all personal tax returns that may be required as a result of his
purchase of Class A Investor Shares. The tax returns of the Company will be
prepared by accountants selected by the Company.
If the tax returns of the Company
are audited, it is possible that substantial legal and accounting fees will
have to be paid to substantiate our position and such fees would reduce the
cash otherwise distributable to Investors.
Each Investor must either report Company
items on his or her tax return consistent with the treatment on the information
return of the Company or file a statement with his tax return identifying and
explaining the inconsistency. Otherwise the IRS may treat such inconsistency as
a computational error and re-compute and assess the tax without the usual
procedural protections applicable to federal income tax deficiency proceedings.
The Code imposes interest and a
variety of potential penalties on underpayments of tax.
The foregoing discussion
addresses only selected issues involving Federal income taxes and does not
address the impact of other taxes on an investment in the Company, including
federal estate, gift, or generation-skipping taxes, or State and local income
or inheritance taxes. Prospective Investors should consult their own tax
advisors with respect to such matters.
The Company will cause the SPEs
to enter into six (6) main contracts for each Project:
·
Purchase and Sale Agreements: When the General Partner identifies
a project that it believes, in its sole discretion, meets the investment
criteria of the Company, it signs a "Purchase and Sale Agreement" to
acquire the rights to the Project from a Development Company.
·
Tax Equity Agreements: In the U.S., some solar projects qualify
for one or more tax incentives. These incentives reduce tax liabilities to both
federal and state government in exchange for making an investment into a solar
project (see "Tax Equity"). When we elect to transfer tax credits to a
Tax Equity investor under the rules specified in the IRA, we will do so under
the terms and conditions of a "Tax Equity Agreement".
·
Power Purchase Agreements: In all cases, the SPEs will sell
electricity produced by the Projects to Customers pursuant to a contract we
refer to as a "Power Purchase Agreement".
·
Purchase and Sale Agreements for Environmental Commodities: In
some cases, the SPEs will sell environmental commodities produced by the
Projects to third parties pursuant to a contract we refer to as an "Purchase
and Sale Agreement for Environmental Commodities".
·
Construction Contracts: To build the Projects, the SPE will hire
a third party to provide engineering, procurement, and construction services
pursuant to a contract referred to as a "Construction Contract".
·
Project Maintenance Contracts: The SPE will then hire a third
party to operate and maintain the Projects pursuant to a contract we refer to
as a "Project Maintenance Contract".
Although the final terms and conditions
and contract title will most likely differ from Project to Project, we will
attempt to ensure that the rights and obligations of the parties will
generally be consistent across all of the Projects. However, there is no
assurance that we will be able to negotiate consistent terms, and the terms and
conditions of each contract may contain material differences.
Page 19
The Company will enter into three
(3) main contracts when making a Loan to a Borrower:
·
Loan Agreement: A Loan Agreement ("Loan Agreement") is a
contract where the Lender provides funds to a Borrower up to a specified limit
over a set borrowing period. The Borrower uses these funds to construct new
solar projects. The Borrower grants the Lender a first-priority lien on all its
assets as collateral, including the solar projects. The agreement includes
conditions for advances, default triggers, and remedies for the Lender, with
covenants ensuring compliance and asset segregation.
·
Collateral Agreements: The "Collateral Agreements" are a
collection of agreements and instruments designed to secure obligations under a
Loan Agreement between a Borrower and the Company. These documents collectively
establish, and perfect the Company's security interests in various assets and
equity interests of the Borrower and related parties. They may include personal
guarantees, corporate guarantees, promissory notes outlining repayment terms,
and pledge agreements granting the Company priority liens on specific
collateral. Supporting resolutions and certificates confirm the Borrower's
authorization and compliance. The Collateral Agreements address repayment
conditions, default remedies, rights over collateral, and ensure the Company's
enforcement capabilities while defining limits on recourse where applicable.
·
Trust Agreement: Some, but not all, Loans will also have a "Trust
Agreement". In circumstances where the General Partner requires more fiscal
oversite over a Borrower, we will set up a trust which will receive all of the
Borrowers revenue (usually payments for energy from their customers). The
General Partner will instruct the Trustee to pay principal and/or interest
payments owed to the Company prior to distributing the remaining cash to the
Borrower for their use in operations.
Material Legal Proceedings
As of the date of this Offering
Circular, neither the Company, nor any of the Company's SPEs, are currently
involved in any material legal proceedings.
A comprehensive discussion on
risks of investing in the Company can be found at the beginning of this
Offering Circular. Below are risks that we believe deserve specific attention,
as they have the highest likelihood of impacting Investor returns. Following
each risk is a brief description of mitigating strategies to be employed by the
General Partner:
· Solar Irradiance: Energea Global forecasts the energy production of each
Project based on historical weather patterns. A deviation from historical
weather patterns could result in lower-than-expected electrical production and
decreased dividends. Projected returns use a P-50 production estimate. P-50 is
an estimate of electrical production where there is a 50% statistical
probability that the Project will produce more electricity and a 50%
probability that the Project will produce less. This is an industry standard
method of weather prediction and production estimating.
o Mitigating Strategy:
Diversifying across many Projects and different geographical markets helps to
mitigate the solar irradiance risk of any specific Project. The Projects are
impossible to predict one day to the next, but over a year, it is actually
quite predictable for experienced managers. Loans carry a lower exposure to
solar irradiance than Projects. A "debt service coverage ratio" is designed to
"make room" for the collateral to underperform and still make the debt service
payment as scheduled. While the effects of solar irradiance on Projects in the
short term are almost impossible to predict, we believe that in the long term
the effects of solar irradiance become more predictable.
Page 20
·
Theft / Damage: The equipment
may be subject to theft or damage which is beyond the Company's control.
Mitigating Strategy:
Energea Global always carries insurance to protect against major loss. We carry
property insurance to cover theft or unexpected damage to the equipment as well
as business interruption insurance to cover lost income during Project
downtime. Many of the Projects are on Customer's rooftops where they enjoy some
level of protection. Loans are less exposed to theft and damage losses.
·
Construction: There is a risk that
the Project could encounter unforeseen delays or costs during the construction
phase that could potentially delay dividends and result in a lower-than
expected IRR.
o Mitigating Strategy: All
Construction Contracts (see summary of "Summary of Supporting
Contracts") have liquidated damages clauses. Liquidated damages hold the
contractor building the Project responsible for any lost revenue resulting from
construction delays. The Company has been successful capturing liquidated
damages from construction companies in the past when Projects are delayed, but
we may not be able to capture them in the future. The Company also acquires all
Projects on a fixed-price basis to limit our exposure to cost overruns during
construction.
·
Customer Default: The primary source of
revenue from Projects and Loans will come from long-term Purchase Power
Agreements and Loans. There is a risk that an entity could default on the
Purchase Power Agreement or Loan.
o Mitigating
Strategy: Energea Global carefully
evaluates the credit risk of the Customers and Borrowers. Most of the contracts
with the Company or SPEs are with large utility companies, large corporations
and U.S. municipalities, which we believe mitigates risk.
·
Materials / Equipment: Equipment may fail or
break down resulting in lower than anticipated production or unplanned
additional operating expenses.
o Mitigating
Strategy: Equipment used in the Projects
come with warranties (ranging from 2 to 25 years depending on the component)
and guarantees from contractors (ranging from 2 to 5 years). Warranties and
guarantees protect against failure when they are properly managed and pursued.
Energea Global also accounts for degradation in our project models and sets
aside a contingency reserve for unforeseen mechanical issues that may arise.
The only assets owned by the
Company are the Projects. To date, the Company has not issued any Loans.
As of the date of this Offering
Circular, the Company holds 4 Projects. The table below lists the total
amount the Company invested into each Project and the estimated Project cost.
Please refer to the links in the column labeled "Form 1-U" for the
Project Memo which gives in-depth information regarding each Project such as
its location, the system size, contractors used to construct the Project,
information about other stakeholders, information about the buyer of the energy
and environmental commodities and the estimated economics of the Project. The
Project Memos can also be found on the Platform.
|
Project Name
|
Entity Name
|
Project Size (AC)
|
Estimated
Projected Cost
|
Amount Invested
|
Form
1-U
|
|
West School
|
Energea West School LLC
|
240 kW
|
$494,821
|
$494,821
|
|
|
Waltham
|
Energea Waltham LLC
|
466 kW
|
$878,557
|
$878,557
|
|
|
Fresno Airport
|
Energea Fresno LLC
|
1.8 MW
|
$2,843,872
|
$2,601,840
|
|
|
Redwood Valley
|
Energea Redwood LLC
|
95 kW
|
$201,920*
|
$0
|
|
|
Total
|
|
|
$4,217,250
|
$3,975,218
|
|
*Estimated cost for Redwood
Valley assumes a complete project refurbishment in 2028.
Page 21
The following discussion of our
financial condition and results of operations should be read in conjunction
with our financial statements and the related notes thereto contained in this
Offering Circular. The following discussion contains forward-looking statements
that reflect our plans, estimates, and beliefs. Our actual results could differ
materially from those discussed in herein (see "Caution Regarding
Forward-Looking Statements" and "Risk Factors"). Unless otherwise
indicated, the latest results discussed below are as of December 31, 2024.
For financial statement purposes,
the Company accounts for investments in Projects under ASC 360. The Projects
are carried at cost and will be depreciated on a straight-line basis over the
estimated useful life of the related assets.
The Company evaluates for
impairment under ASC 360, utilizing the following required steps to identify,
recognize and measure the impairment of a long-lived asset to be held and used:
·
Indicators of impairment - Consider whether indicators of impairment are
present
· Test for
recoverability - If indicators are present, perform a recoverability test by
comparing the sum of the estimated undiscounted future cash flows attributable
to the long-lived asset in question to its carrying amount (as a reminder,
entities cannot record an impairment for a held and used asset unless the asset
first fails this recoverability test).
·
Measurement of an impairment - If the undiscounted cash flows used in
the test for recoverability are less than the carrying amount of the long-lived
asset, determine the fair value of the long-lived asset and recognize an
impairment loss if the carrying amount of the long-lived asset exceeds its fair
value.
The company follows ASC 606
guidelines for revenue recognition. To apply this principle, the standard
establishes five key steps:
· Step 1:
Recognize the contract with the Customer/Borrower
· Step 2:
Specify performance obligations
· Step 3:
Establish transaction price
· Step 4:
Allocate transaction price to performance obligations
· Step 5:
Recognize revenue
We believe that the U.S. solar
sector is entering a period of heightened uncertainty, marked by several
interlocking headwinds that are beginning to reshape the near-term landscape
for developers and investors alike. Rising interest rates have increased the
cost of capital for project sponsors, which we believe has put pressure on
development pipelines and caused repricing of risk across the market. At the
same time, supply chain disruptions-particularly in the sourcing of
photovoltaic modules-continue to challenge project timelines and budgets. These
disruptions have been compounded by recent trade policy developments, including
the Biden Administration's decision to reinstate tariffs on solar panels
imported from Southeast Asia starting in mid-2024, following the expiration of
the two-year moratorium on duties for certain countries. The decision has
injected renewed uncertainty into module pricing and availability, particularly
for developers reliant on lower-cost imports to maintain economic project structures.
Page 22
Layered atop these logistical and
financial challenges is the uncertain U.S. policy environment regarding solar
energy. While the IRA is believed to broadly strengthen the long-term outlook
for U.S. clean energy investment, the implementation of its tax credit
provisions-including domestic content requirements, prevailing wage standards,
and credit transferability protocols-have introduced a complex set of
compliance and timing risks. Moreover, the legislative agenda in Washington
remains fluid, with the proposed "Big Beautiful Bill" signaling potential
structural changes to the ITC framework and other key federal incentives. These
developments are already causing some project sponsors to delay financial
closes or rework underwriting assumptions and may ultimately slow the pace of
greenfield development over the coming quarters.
In contrast to these pressures,
our belief is that the Company's current investment strategy is designed to be
largely insulated from the risks facing new project development. Our focus on
issuing secured loans and acquiring operational renewable energy assets offers
a different risk-return profile than ground-up construction. By targeting
projects that are already generating cash flows-or underwriting against
contracted revenue streams from seasoned operators-we should be able to
sidestep interconnection delays, module sourcing risk, and the execution
uncertainty that has become more prevalent in today's market. This approach
also reduces our reliance on Tax Equity at a time and in a market that we
believe remains undersupplied and volatile.
Importantly, our belief is that
periods of market dislocation can create compelling entry points. As developers
and asset owners face margin compression, policy risk, or constrained access to
capital, we anticipate an increase in high-quality operating assets coming to
market-sometimes from sellers under financial duress. These conditions may
allow the Company to acquire attractive, performing assets at discounted
valuations, creating the potential for enhanced yields and long-term value for
our investors. Rather than being exposed to the cyclical downturn in
development activity, our belief is that the Company is positioned to act as a
stable source of capital and a disciplined acquirer, taking advantage of
dislocations while adhering to a conservative underwriting philosophy. This
defensive posture, paired with opportunistic flexibility, is expected to serve
our investors well amid an increasingly bifurcated market.
The Company intends to make
distributions monthly, to the extent the General Partner, in its discretion,
determines that cash flow is available for distributions and in a manner
consistent with the Authorizing Resolutions. Any other distributions shall be
made pursuant to the terms of the LP Agreement which gives the General Partner
broad discretion whether to make any distributions. To date, the Company
has not made a profit, although it has had distributable cash flow. Below are
the activities of the Company that generate the cash flow which could be used
to fund distributions:
- Net income received from the Projects;
- Interest payments received from the Borrowers;
- Interest payments received from Company Investments;
- Net Proceeds from Capital Transactions;
- Originates from the sale or refinancing of Projects;
- Net proceeds are the gross proceeds of the capital transaction minus associated expenses, including debt repayment; and
- Liquidated Damages from Construction Agreements;
- Penalties paid by EPC Contractors when Projects are delivered behind schedule;
- Liquidated Damages are not booked as revenue but are considered distributable cash flow.
When the Company has
distributable cash flow and the General Partner determines to make a
distribution, here is an overview of how these distributions are allocated and
calculated:
Page 23
Distributable cash flow, if any,
is distributed to the Preferred Equity Investors, on a pari passu basis,
and the General Partner in the following order of priority:
- First, the Preferred Return;
- Thereafter, any additional cash flow shall be distributed 80% to Preferred Equity Investors and the Carried Interest to the General Partner.
The General Partner discounts
each month of Estimated NOI (see "Price of Class A Investor Shares") by
the same discount rate until the cash flow results in an internal rate of
return ("IRR") of 6% ("Adjusted NOI"). The IRR is
calculated using the extended internal rate of return ("XIRR") function
and is based upon the price an Investor paid per Class A Investor Share. The
resulting Adjusted NOI is the monthly distribution that would need to be paid
to Investors for them to receive their Preferred Return. Since all months of
Estimated NOI are discounted evenly, the Adjusted NOI maintains the same
seasonality curve as the Estimated NOI. If the actual NOI for any month is less
than the Adjusted NOI, the Investors receive all the cash distributed that
month and the shortfall is carried forward so that Investors catch up on their
Preferred Return prior to any Carried Interest being paid. The IRR is
calculated based upon the price an Investor paid per Class A Investor Share,
and not on any revenue or profit achieved by the Company. To date, the Company
has not made a profit, although it has had distributable cash flow. To the
extent the Company has distributable cash flow but has no current or
accumulated earnings and profit, such distributions are considered a return of
capital for U.S. federal income tax purposes to the extent that the
distributions do not exceed the adjusted tax basis of the U.S. Holder's Class A
Investor Shares.
If the General Partner determines
that a distribution can be made with distributable cash flow, and the amount of
distributable cash flow is greater than the Adjusted NOI for the month (and the
Investors are therefore on track to receive their Preferred Return), the
General Partner will receive a Carried Interest. Any distributable cash flow
that is greater than the Adjusted NOI (plus any shortfall from previous months)
will be divided between the General Partner and the Preferred Equity Investors
where the General Partner will get 20% of the excess and Preferred Equity
Investors will get 80% of the excess.
Provided we have distributable
cash flow (see "Sources of Distributable Cash Flow"), we will authorize and
declare distributions based on the Projects' net income, interest paid on Loans
and interest earned on Company Investments during the preceding month minus any
amounts held back for reserves.
While we are under no obligation
to do so, our General Partner may declare other periodic distributions as
circumstances dictate.
To date, the Company has not made
a profit, although it has had distributable cash flow. To the extent the
Company has distributable cash flow but has no current or accumulated earning
and profit, such distributions are considered a return of capital for U.S.
federal income tax purposes to the extent that the distributions do not exceed
the adjusted tax basis of the U.S. Holder's Class A Investor Shares and
reported to Investors on a Form 1099-B. To the extent the Company makes
distributions from profits in the future, such distributions will be classified
as dividends and reported to Investors on a Form 1099-DIV.
Please note that in some cases,
Investors have cancelled their purchase of Class A Investor Shares after
distributions were made. In that case, the distribution allocated to that
Investor is returned to the Company and the bookkeeping is updated to reflect
the change in cash distributed. Thus, all figures below are subject to change.
Page 24
Below is a table depicting the
fees paid and distributions made from the Company since inception. Note that
whenever the table shows that the General Partner has received its Carried
Interest, the Investors have received their full Preferred Return, as defined
in "Allocations of Distributions". In those cases where the General
Partner does not receive its Carried Interest, distributions were not
sufficient to distribute to Investors their Preferred Return.
|
Distribution Date
|
Distributable Cash Flow
|
Preferred Return
|
Additional Cash Flow (80%)
|
Promoted Interest* (20%)
|
Class A Investor Distributions**
|
Cash on Cash Yield***
|
|
10/29/21
|
1,863.54
|
1,800.75
|
62.79
|
0.00
|
1,863.54
|
0.19%
|
|
11/30/21
|
2,069.77
|
1,972.32
|
97.45
|
0.00
|
2,069.77
|
0.20%
|
|
12/24/21
|
1,672.23
|
1,605.48
|
66.75
|
0.00
|
1,672.23
|
0.16%
|
|
2021 Total
|
$5,605.54
|
$5,378.55
|
$226.99
|
$0.00
|
$5,605.54
|
0.55%
|
|
1/26/22
|
3,341.03
|
3,211.77
|
129.26
|
0.00
|
3,341.03
|
0.32%
|
|
2/24/22
|
928.47
|
892.57
|
28.72
|
7.18
|
921.29
|
0.08%
|
|
3/29/22
|
1,520.21
|
1,505.01
|
15.20
|
0.00
|
1,520.21
|
0.14%
|
|
4/29/22
|
257.37
|
239.48
|
17.89
|
0.00
|
257.37
|
0.03%
|
|
5/31/22
|
1,522.02
|
1,416.23
|
105.79
|
0.00
|
1,522.02
|
0.14%
|
|
6/30/22
|
6,805.81
|
6,343.86
|
369.56
|
92.39
|
6,713.42
|
0.63%
|
|
7/29/22
|
10,186.42
|
10,186.42
|
0.00
|
0.00
|
10,186.42
|
0.94%
|
|
8/27/22
|
10,369.88
|
9,598.53
|
617.08
|
154.27
|
10,215.61
|
0.95%
|
|
9/27/22
|
9,030.53
|
8,404.69
|
625.84
|
0.00
|
9,030.53
|
0.83%
|
|
10/27/22
|
7,087.15
|
6,531.83
|
555.32
|
0.00
|
7,087.15
|
0.59%
|
|
11/29/22
|
7,397.12
|
6,817.51
|
579.61
|
0.00
|
7,397.12
|
0.58%
|
|
12/28/22
|
6,292.48
|
5,799.42
|
493.06
|
0.00
|
6,292.48
|
0.46%
|
|
2022 Total
|
$64,738.49
|
$60,947.32
|
$3,537.33
|
$253.84
|
$64,484.65
|
5.69%
|
|
1/27/23
|
7,474.82
|
6,889.12
|
585.70
|
0.00
|
7,474.82
|
0.50%
|
|
2/27/23
|
6,450.12
|
5,815.77
|
507.48
|
126.87
|
6,323.25
|
0.38%
|
|
3/27/23
|
7,627.85
|
6,913.90
|
571.16
|
142.79
|
7,485.06
|
0.42%
|
|
4/27/23
|
7,223.89
|
6,603.84
|
496.04
|
124.01
|
7,099.88
|
0.37%
|
|
5/30/23
|
9,128.07
|
8,338.42
|
631.72
|
157.93
|
8,970.14
|
0.43%
|
|
6/26/23
|
9,982.82
|
9,088.32
|
715.60
|
178.90
|
9,803.92
|
0.44%
|
|
7/25/23
|
9,449.19
|
8,665.49
|
626.96
|
156.74
|
9,292.45
|
0.40%
|
|
8/28/23
|
10,054.19
|
9,247.04
|
645.72
|
161.43
|
9,892.76
|
0.41%
|
|
9/27/23
|
10,556.69
|
9,842.59
|
571.28
|
142.82
|
10,413.87
|
0.41%
|
|
10/27/23
|
13,420.03
|
12,410.08
|
807.96
|
201.99
|
13,218.04
|
0.48%
|
|
11/24/23
|
13,954.97
|
12,902.52
|
841.96
|
210.49
|
13,744.48
|
0.48%
|
|
12/26/23
|
17,437.31
|
16,185.99
|
999.34
|
251.98
|
17,185.33
|
0.59%
|
|
2023 Total
|
$122,759.95
|
$112,903.08
|
$8,000.92
|
$1,855.95
|
$120,904.00
|
5.31%
|
|
1/26/24
|
17,008.87
|
15,751.07
|
1,005.88
|
251.74
|
16,756.95
|
0.57%
|
|
2/27/24
|
9,862.79
|
9,206.26
|
525.04
|
131.49
|
9,731.30
|
0.56%
|
|
3/26/24
|
18,687.60
|
16,922.56
|
1,411.40
|
353.64
|
18,333.96
|
0.31%
|
|
4/26/24
|
19,576.96
|
18,134.53
|
1,370.29
|
72.14
|
19,504.82
|
0.55%
|
|
5/24/24
|
26,630.43
|
24,895.93
|
1,734.56
|
0.00
|
26,630.49
|
0.76%
|
|
6/27/24
|
33,046.72
|
30,887.56
|
2,159.29
|
0.00
|
33,046.85
|
0.92%
|
|
7/26/24
|
19,054.09
|
17,548.88
|
1,354.42
|
150.52
|
18,903.30
|
0.50%
|
|
8/27/24
|
14,539.37
|
13,220.42
|
1,055.11
|
263.79
|
14,275.53
|
0.37%
|
|
9/27/24
|
12,513.60
|
11,614.52
|
719.12
|
179.82
|
12,333.64
|
0.31%
|
|
10/28/24
|
13,046.24
|
12,114.49
|
897.29
|
0.00
|
13,011.78
|
0.31%
|
|
11/26/24
|
10,094.10
|
9,351.02
|
716.29
|
0.00
|
10,067.31
|
0.22%
|
|
12/24/24
|
24,040.83
|
21,919.91
|
2,112.69
|
0.00
|
24,032.60
|
0.51%
|
|
2024 Total
|
$218,101.60
|
$201,567.15
|
$15,061.38
|
$1,403.14
|
$216,628.53
|
5.89%
|
|
1/24/25
|
9,582.66
|
8,773.68
|
808.98
|
0.00
|
9,582.66
|
0.19%
|
|
2/25/25
|
16,403.66
|
15,084.18
|
1,319.48
|
0.00
|
16,403.66
|
0.32%
|
|
3/27/25
|
20,550.00
|
18,939.77
|
1,610.23
|
0.00
|
20,550.00
|
0.39%
|
|
2025 Total
|
$46,536.32
|
$42,797.63
|
$3,738.70
|
$0.00
|
$46,536.32
|
0.90%
|
|
TOTAL
|
$457,741.91
|
$423,593.73
|
$30,565.31
|
$3,512.93
|
$454,159.04
|
18.34%
|
*Note: The General Partner reserves
the right to reduce its Management Fees and/or Carried
Interest payments for any reason or to protect the desired cash yield to
Investors. For more information regarding the Management Fees and Carried Interest paid to our General Partner, see
"Compensation of General Partner".
**Note: Class A Investor
distributions are equal to the Preferred Return plus any additional cash flow,
please see "Calculating Distributions".
***Note: Monthly cash-on-cash
yield values are calculated by dividing the Investor Distributions amount by
the total cost basis of all outstanding shares at the time the distribution is
issued. Year-end cash-on-cash yields are calculated by summing all monthly
cash-on-cash yields for the respective year.
Page 25
The Company experienced
significant changes in its operating results from inception through December 31,
2024, with increased revenue generated from operating Projects. However,
operating expenses also rose due to the costs of managing a larger portfolio of
operating Projects. Although no new Projects were acquired in 2024, the Company
continued to focus on maximizing the performance of its existing Projects. We
anticipate increases in revenue in future years as new Projects are acquired.
Throughout 2024, the Company met cash flow projections by selling power and
environmental commodities from the Projects at West School, Waltham, Redwood
Valley and Fresno Airport.
For
the fiscal years ended December 31, 2024 and 2023, the Company generated
revenue of $329,680 and $189,884, respectively. This significant increase was
primarily driven by the Project Fresno Airport, which began generating revenue
in 2024.
As of December 31, 2024 and 2023,
the Company's total operating expenses were $77,221 and $69,610, respectively,
including professional fees, advertising and marketing, software subscription,
taxes, depreciation, and other general and administrative expenses. As of
December 31, 2024 and 2023, the Projects' operating expenses were $237,908 and
$134,568 respectively, covering professional fees, travel, taxes, depreciation,
operation and maintenance, and other general and administrative expenses. The
increase in operating expenses was due to the addition of Projects being turned
on.
For the fiscal year ended
December 31, 2024, the Company reported operating income of $14,551, a notable
improvement from the operating loss of $14,294 recorded in 2023. In addition,
total other income in 2024 amounted to $27,889, compared to other expenses of
$10,061 in the prior year. As a result, the Company achieved a total net income
of $42,440 for 2024, reversing the net loss of $24,355 incurred in 2023.
The Company might borrow money to
invest in Projects, depending on the circumstances at the time. If the Company
needs to move quickly on a Project and has not yet raised enough capital
through the Offering, it might make up the shortfall through borrowing. The
General Partner will make this decision on an as-needed basis. As of the date
of this Offering Circular neither the Company nor the Projects currently
have any loans.
We are dependent upon the net
proceeds from the Offering to conduct our proposed investments. We will obtain
the capital required to purchase new Projects, issue new Loans and conduct our
operations from the proceeds of the Offering and any future offerings we may
conduct, from secured or unsecured financings from banks and other lenders,
from short term advances from the General Partner and from undistributed funds
from our operations. As of December 31, 2024, the Company had $916,368 of cash
on hand and equivalents, which will be used to pay for the remaining costs of
constructing the Project Fresno Airport.
Page 26
The compensation described in this
section was calculated using the accrual method in accordance with U.S. GAAP.
The Company itself has no
officers or employees. The individuals listed below are the Managing Partners,
Executive Officers, and Significant Employees of Energea Global, the General
Partner of the Company.
|
Name
|
Position with General Partner
|
Age
|
Term of Office
|
Approximate Hours Per Week If Not Full Time (1)
|
|
Executive Officers
|
|
|
|
|
|
Mike Silvestrini
|
Managing Partner
|
45
|
01/01/2017 - Present
|
Full Time
|
|
Chris Sattler
|
Managing Partner
|
45
|
01/01/2017 - Present
|
Full Time
|
|
Gray Reinhard
|
Managing Partner, CTO
|
40
|
01/01/2020 - Present
|
Full Time
|
|
Isabella Mendonça
|
Managing Partner, General
Counsel
|
33
|
10/02/2020 - Present
|
Full Time
|
|
|
|
|
|
|
|
Significant Employees
|
|
|
|
|
|
Arthur Issa
|
Financial Analyst
|
30
|
05/23/2018 - Present
|
Full Time
|
|
Paulo Vieira
|
Director of O&M
|
38
|
01/29/2024 - Present
|
Full Time
|
|
Francielle Assis
|
HR & HSEC Legal Coordinator
|
33
|
07/24/2023 - Present
|
Full Time
|
|
Marta Coelho
|
Controller, Global
|
52
|
12/07/2018 - Present
|
Full Time
|
|
Dave Rutty
|
Project Analyst
|
35
|
06/13/2022 - Present
|
Full Time
|
|
Julio Cezar dos Santos de Morais
|
Electrical Engineer
|
35
|
09/25/2023 - Present
|
Full Time
|
|
Juan Carvajales
|
Loan Analyst
|
52
|
08/01/2023 - Present
|
Full Time
|
(1) The above listed employees
do not record specific hours to each Company managed by Energea Global. Rather,
the employees focus their full-time and energy to each Project, portfolio, or
process as needed. The General Partner cannot estimate number of hours per week
spent managing this or any particular Company as the employees are salaried.
The work required to manage the Company and other companies managed by Energea
Global changes from time to time depending on the number and frequency of
Projects resulting from the amount they raise in each Offering. As the
companies grow, dedicated staff are brought in to exclusively manage a specific
company. As of December 31, 2024, there are no staff members exclusively
dedicated to the Company and it is managed by the General Partner's executive
team and certain significant employees.
Marta Coelho, the General
Partner's Controller, is the sister-in-law of Mike Silvestrini, the Managing
Partner. There are no other family relationships among the executive officers
and significant employees of the General Partner.
Energea Global, the General
Partner of the Company, is majority owned by Mike Silvestrini, a resident of
Chester, Connecticut.
Page 27
Mike Silvestrini
Mike is an accomplished
professional with over 15 years of experience in the solar energy industry. He
has played an executive key role in the development of over 500 solar projects
across the United States, Brazil, and Africa while being directly responsible
for nearly one billion of combined solar project finance.
Since 2017, Mike has been the
Co-Founder & Managing Partner at Energea Global LLC. In his capacity as
Co-Founder & Managing Partner of the General Partner, Mike directs the
Investment Committee which determines the investment strategy for all funds
managed by the business. To date, Energea Global manages 3 funds formed to
acquire and operate solar power projects: the Company, Energea Portfolio 2 LP,
and Energea Portfolio 3 Africa LP. See "Other Solar Energy Funds" below
for the status each fund's offerings.
Since 2015, Mike has served as a
Board Member of the Big Life Foundation, an organization dedicated to
preserving over 1.6 million acres of wilderness in East Africa. Through
community partnerships and conservation initiatives, Big Life protects the region's
biodiversity and promotes sustainable practices.
From 2008 to 2017, Mike
co-founded and served as the CEO of Greenskies Renewable Energy LLC, a leading
provider of turnkey solar energy services. His expertise contributed to the
development, financing, design, construction, and maintenance of solar projects
across the United States. Notably, he was involved in solar installations on
Target Corporation stores and distribution centers, Wal-Marts and Sam's Clubs,
Amazon distribution centers, capped municipal landfills, and any schools and
universities.
Mike's track record in renewable energy,
his involvement in hundreds of solar projects worldwide, and his dedication to
environmental sustainability position him as a driving force in managing
investments in solar generating assets.
Chris Sattler
Chris is a seasoned energy
entrepreneur with a proven track record in building and scaling companies in
the renewable and retail energy sectors. Most recently, he served as Chief
Executive Officer of IVI Energia, a joint venture between Energea Global and
Brookfield Asset Management. Over his 18-month tenure, he led the company from
inception to a $280 million valuation before returning to his role at Energea
Global.
Earlier in his career, Chris
co-founded North American Power and served as Chief Operating Officer. Under
his leadership, the company expanded into more than 35 utility markets across
the U.S., serving over one million residential and small commercial customers.
In 2017, the company was acquired by Calpine Corporation with annual gross
sales exceeding $850 million.
Chris holds a Bachelor's degree
in Real Estate and Urban Economics from the University of Connecticut School of
Business and is an alumnus of Harvard Business School's Program for Leadership
Development. He currently resides in Rio de Janeiro.
Gray Reinhard
Gray is an experienced software
engineer specializing in business intelligence tools across multiple
industries. Early in Gray's career, he worked primarily in E-Commerce where he
built and supported sites for over 20 brands including several Fortune 500
companies. From there, Gray moved into renewable energy where he developed the
project management software for the country's largest commercial solar
installer, Greenskies. This custom platform managed everything from sales and
financing to the construction, maintenance, and performance monitoring of over
400 solar projects owned by the company.
Prior to joining Energea Global
in January 2020, Gray served as the CTO of Dwell Optimal Inc. which assists
businesses providing employees with travel accommodations.
Gray studied at Princeton
University.
Page 28
Isabella Mendonça
Isabella is a corporate lawyer
with experience in cross-border M&A transactions and the drafting and
negotiation of highly complex contracts and corporate acts in different
sectors, such as energy, oil & gas and infrastructure. Isabella has previously
worked as an attorney for Deloitte and Mayer Brown in Brazil, where she was an
associate in the Energy group, working in regulatory, contractual and corporate
matters related to renewable energy project development.
From 2016 until she joined
Energea Global, Isabella was an associate in the corporate and securities
practice at Mayer Brown in the Rio de Janeiro office.
Isabella studied law at Fundacão
Getulio Vargas, in Brazil and has a master's degree (LLM) from the University
of Chicago.
Arthur Issa
Arthur Issa was one of the first employees
at Energea Global, starting in May, 2018. Over the course of his time with the
business, Arthur has participated in the successful closing of more than 100 MW
of solar projects and developed the financial models that support more than
$300mm of AUM. Arthur is responsible for financial modeling of all Projects and
Loans at Energea Global. He also supports the company's corporate financial
planning through detailed financial modelling, reporting and cash flow
management. As an integral part of the team, he provides the tools necessary
for management to make investment decisions for Energea Global and the Company.
Arthur has a B.S. in Production Engineering from University Candido Mendes in
Rio de Janeiro, Brazil.
Paulo Vieira
Paulo is an accomplished
electrical engineer with a master's degree in Energy Resources Engineering and
over 5 years of leadership experience in the renewable energy sector. He
currently serves as the Global O&M Manager at Energea Global, where he oversees
operations and maintenance across a global portfolio of photovoltaic assets
spanning the USA, Brazil, and South Africa. Paulo is a member of Energea
Global's Investment Committee.
Specializing in solar energy
systems, Paulo has led the operations of more than 2.2 GW of solar projects.
His expertise includes O&M strategy development, performance optimization,
technical team leadership, and cost control initiatives aimed at improving
operational KPIs and financial performance. His professional journey includes
strategic roles at Recurrent Energy, Enel Green Power, COMERC Energia, Solarig,
and AKTOR SA, where he managed large-scale solar assets and drove operational
excellence through data-driven decision-making and cross-functional
coordination.
Paulo also brings a strong
academic foundation, with a postgraduate specialization in Photovoltaic Solar
Systems and international experience through Brazil's Scientific Mobility
Program in the U.S., where he studied at The University of Texas at El Paso. He
is deeply committed to advancing clean energy and delivering high-impact,
data-driven solutions in the solar power sector.
Francielle Assis
Francielle has over five years of
professional legal experience with a focus on labor and corporate law within
large-scale corporate environments. Since September 2024, she has served as HR
& HSEC Legal Coordinator at Energea Global. In that capacity, she ensures
compliance with labor laws and regulations for all corporate Human Resources
and oversees the company's Health, Safety, Environment and Community ("HSEC")
compliance and risk mitigation. Her responsibilities include managing labor
litigation, advising on employment law matters, and coordinating with
regulatory agencies and external legal counsel. She also attends site visits
for each Project to opine on the community and security risk prior to
investment and sits on Energea Global's Investment Committee.
Prior to joining Energea Global,
Francielle was a Senior Strategic Labor Attorney at CPFL Energia, one of
Brazil's largest energy companies. There, she led complex employment litigation
strategies and advised on collective labor issues. She also served as Labor
Attorney at CPFL, supporting operational and strategic labor matters across the
company's various business units.
Earlier in her career, Francielle
worked in both private law firms and governmental institutions, handling labor
and civil litigation. Her experience includes managing procedural strategies
and representing corporate clients in both individual and collective labor
disputes, demonstrating a high level of legal and operational competence.
Page 29
Marta Coelho
Since its inception in 2018,
Marta Coelho has served as the Controller at Energea Global, bringing with her
a wealth of experience and expertise in finance and accounting. As the global
Controller, Marta plays a crucial role in managing all financial aspects,
including account management, taxation, and audits, for Energea Global's
diverse range of operating entities and projects across Africa, Brazil, and the
USA. Marta leads a team of subordinate controllers and accountants at Energea
Global and coordinates with a bench of third-party accounting firms across our
jurisdictions of operation.
Dave Rutty
Dave is a highly experienced
solar professional with over 12 years of hands-on experience building,
maintaining, and managing solar projects. As a Project Analyst at Energea
Global, he plays a pivotal role in overseeing construction and maintenance
operations across all markets, ensuring projects are executed with precision,
safety, and technical excellence. Dave is responsible for preparing Investment
Committee memos across Energea Global's multidisciplinary team of experts to
ensure all investments meet the company's stringent compliance requirements.
From 2020 to 2022, Dave served as
a Managing Partner at SRES, a solar contracting company based in the
northeastern U.S. Prior to that, Dave was served as the Vice President of
Operations and Maintenance at Greenskies Renewable Energy LLC.
Julio Cezar dos Santos de
Morais
Julio is an experienced
electrical engineer specializing in photovoltaic systems, currently serving as
an Electrical Engineer at Energea Global since October 2023. He oversees
project design, field and factory inspections, and engineering analysis for distributed
generation systems. His technical expertise includes tools such as PVSyst,
AutoCAD, and protection design for medium-voltage applications.
Over the past nine years, Julio
has held engineering roles at CPFL Renováveis, Deode Energia, MEPEN Energia,
and others, where he managed solar projects exceeding 100 MW of combined solar
power generation capacity. Julio led technical teams and performed system
simulations and commissioning. He holds both bachelor's and master's degrees in
Electrical Engineering from the Federal University of Technology - Paraná
(UTFPR), with academic research published in the field of power electronics.
Juan Carvajales
Juan is a seasoned business
development professional with over 15 years of experience in the renewable
energy sector across U.S. and Latin American markets. Since August 2023, he has
worked as a Loan Analyst at Energea Global, where he supports investment
strategies and portfolio architecture, leveraging his background in project
development, financing, and cross-border renewable energy transactions to
identify private credit opportunities.
Before joining Energea Global,
Juan held key leadership roles including Director of Business Development at
GeneraSol (2007-2023) and Board Member at SUA Power Company (2021-2023), where
he focused on structuring and executing solar PV and off-grid energy projects.
He has also led utility-scale solar development at Grupo BAZ and has a
foundational background in project and operations management. Juan holds a BBA
from Politécnico Costa Atlántica and additional certifications in solar energy
and environmental science.
Page 30
Within the last five years, no
Director, Executive Officer, or Significant Employee of the Company has been
convicted of, or pleaded guilty or no contest to, any criminal matter,
excluding traffic violations and other minor offenses.
Within the last five years, no
Director, Executive Officer, or Significant Employee of the Company, no
partnership of which an Executive Officer or Significant Employee was a general
partner, and no corporation or other business association of which an Executive
Officer or Significant Employee was an executive officer, has been a debtor in
bankruptcy or any similar proceedings.
Energea Global, the General Partner
of the Company, is also the general partner of two other funds formed to
acquire and operate solar power projects, each of which is conducting an
offering under Regulation A:
·
Energea Portfolio 3 Africa LP ("Portfolio 3"), which was formed
to acquire and operate projects located in Africa.
·
Energea Portfolio 2 LP ("Portfolio 2"), which was formed to
acquire and operate projects located in the Brazil.
The status of each of the
Company's, Portfolio 3's and Portfolio 2's current and prior offerings, as of
December 31, 2024, is below:
|
Energea
Portfolio 2 LP
|
Energea
Portfolio 3 Africa LP
|
Energea
Portfolio 4 USA LP
|
|
|
Date of Prior Offering
Qualification
|
08/13/2020
|
08/2/2021
|
07/01/2021
|
|
Offering Amount Raised Through 12/31/24
|
$22,061,519.49
|
$5,152,094.63
|
$4,753,234.65
|
|
Solar Projects Owned
|
Thirteen
|
Sixteen
|
Four
|
|
Prior Offering Status
|
Terminated
|
Terminated
|
Terminated
|
|
Current Maximum Offering Amount
|
$50,000,000
|
$50,000,000
|
$50,000,000
|
|
Date of Current Offering
Qualification
|
06/06/2024
|
06/17/2024
|
06/26/2024
|
* Gross of stock issuance
costs
Our General Partner is compensated when the Company pays the
fees described in the table below ("Fees"):
|
Type of Fee
|
Timing of Fee
|
Description
|
|
Reimbursement of Marketing
Expenses
|
Ongoing
|
The Company must reimburse the
General Partner for expenses the General Partner incurs while promoting the
Company to potential investors. The maximum reimbursable amount is 5% of the
total amount raised. Types of costs that will be reimbursed by the Company to
the General Partner for marketing expenses include digital and conventional
advertisements, marketing personnel and third-party costs, promotional events
and any other cost associated with communicating this Offering to the general
public.
|
|
Management Fees
|
Ongoing
|
The General Partner will charge the Company a monthly
management fee equal to 0.167% of the aggregate capital that has been
invested into the Company.
|
|
Carried Interest
|
When the distributions exceed
the Preferred Return
|
The General Partner will receive
20% of all distributed cash flow above the monthly amount necessary for
Preferred Equity Investors to receive their Preferred Return. For more
detail, see "Carried Interest" below
|
|
When Projects and Loans are originated
|
The General Partner might originate and develop Projects
and Loans that are acquired by the Company. If so, the General Partner shall
be entitled to compensation that is no greater than 5.0% of the Project's
cost or the Loan's outstanding balance.
|
|
|
O&M and Energy Sales
Services ("Ancillary Services")
|
Ongoing as services are rendered
according to contract
|
The Company does not currently
pay the General Partner for any Ancillary Services.
|
|
Interest on Loans
|
Whenever due and payable
|
The General Partner might lend to the Company to fund the
acquisition or investment in Projects and Loans or for other purposes. Such a
loan will bear interest at market rates. The amount of interest will depend
on the amount and term of any such loans.
|
Page 31
While the General Partner is not entitled to any
compensation other than the Fees as described above, it may defer some or all of
Fees at any time based on the General Partner's assessment of the cash flow at
the Company. Some Fees may be deferred indefinitely at the discretion of the
General Partner. To date, the General Partner has provided services without
charging the full amount owed by the Company. As the Company and its cash flow
stabilize, the General Partner may charge for deferred Fees ("Deferred Fees")
- see "Fees Paid to General Partner" for more information.
Fees Paid to General Partner
As the Company grows, markets,
exceeds Preferred Returns and requires the General Partner for Ancillary
Services, fees are accrued to the General Partner, some of which are deferred,
as described above. Below is a table which calculates the total amounts paid to
the General Partner from all possible fees, which have been paid as of December
31, 2024:
|
Fee Type
|
Fees Paid to
General Partner in 2024
|
Fees Paid Since
Inception
|
|
Reimbursement of Marketing Expenses
|
$50,000.00
|
$100,000.00
|
|
Asset Management Fee
|
$39,323.35
|
$74,991.51
|
|
Carried Interest
|
$1,403.14
|
$3,512.93
|
|
Origination Fees
|
-
|
$166,780.36
|
|
Ancillary Services
|
-
|
-
|
|
Interest on Loans
|
-
|
-
|
|
TOTAL
|
$90,726.49
|
$345,284.80
|
The General Partner and its affiliates
might purchase Class A Investor Shares. If so, they will be entitled to the
same distributions as other Preferred Equity Investors. If such investment is
made to facilitate the Company's acquisition of or investment in Projects
before there are sufficient offering proceeds, the General Partner will be
entitled to redeem its Class A Investor Shares from additional Offering
proceeds as they are raised.
The individuals named below, as
well as other employees of the General Partner may own Class A Investor Shares
that they purchased privately through the Platform in the same manner as any
Investor.
The following table sets forth
the approximate beneficial ownership of our Class A Investor Shares as of
December 31, 2024, for each person or group that holds more than 10.0% of our
Class A Investor Shares, and for each director and executive officer of our
General Partner and for the directors and executive officers of our General
Partner as a group.
Page 32
|
Name of Beneficial Owner (1)(2)
|
Number of
Shares Beneficially Owned
|
Amount and
Nature of Beneficial Ownership Acquirable
|
Percent of All
Shares
|
|
Energea Global LLC
|
19,527
|
N/A
|
0.4359%
|
|
Michael Silvestrini
|
8,146(3)
|
N/A
|
0.1818%
|
|
Christopher Sattler
|
6,390(3)
|
N/A
|
0.1426%
|
|
Gray Reinhard
|
534
|
N/A
|
0.0119%
|
|
All directors and executive officers of our General
Partner as a group (3 persons)
|
702
|
N/A
|
0.0157%
|
|
-
|
|
-
|
(1) Under SEC rules, a person is deemed
to be a "beneficial owner" of a security if that person has or shares "voting
power," which includes the power to dispose of or to direct the disposition of
such security. A person also is deemed to be a beneficial owner of any securities
which that person has a right to acquire within 60 days. Under these rules,
more than one person may be deemed to be a beneficial owner of the same
securities and a person may be deemed to be a beneficial owner of securities as
to which he or she has no economic or pecuniary interest.
(2) Each listed beneficial owner,
person or entity has an address in care of our principal executive offices at
52 Main Street, Chester, CT 06412.
(3) Includes shares beneficially owned
by Energea Global LLC, under the control of its Class A Shareholders. Notably,
Michael Silvestrini and Chris Sattler, as the largest principal shareholders,
hold 41.33% and 32.24% of the shares of Energea Global LLC, respectively. (As
of December 31, 2024)
The Company might enter into
other transactions with related parties. If so, any compensation paid by the
Company to the related party shall be (i) fair to the Company, and (ii)
consistent with the compensation that would be paid to an unrelated party.
By "related party" we mean:
·
The General Partner or a subsidiary of the General Partner;
·
Any director, executive officer, or significant employee of the Company
or the General Partner;
·
Any person who has been nominated as a director of the Company or the
General Partner;
·
Any person who owns more than 10% of the voting power of the Company or
the General Partner; and
·
An immediate family member of any of the foregoing.
As of the date of this Offering
Circular, the Company has entered into transactions with related parties in one
circumstance:
·
Credit Advance: The Company entered into several credit advances
from the General Partner to accelerate the availability of capital needed to
make certain small payments. These amounts are recorded as do-to/do-from
transactions and no interest is charged to the Company for these advances.
The Company has not, and does not intend to, enter into any
related party transaction with the General Partner or its subsidiaries or any
other related party other than those transactions described above in "Compensation
of General Partner". As discussed above, the Company may pay or reimburse
the General Partner for marketing expenses, management fees, Carried Interest,
Ancillary Services and interest on loans. There are no other expenses, nor will
there be other expenses in the future, where the Company pays a related party
other than the Fees.
The Company is offering up to
$50,000,000 of Class A Investor Shares. All of the rights and obligations
associated with the Class A Investor Shares are set forth in:
·
The LP Agreement, which can be found here; and
·
The Authorizing Resolution, which can be found here.
The fixed price of Class
A Investor Shares was determined by calculating the Net Asset Value ("NAV")
of the Company and dividing the NAV by the total number of outstanding shares.
The NAV is calculated as the Net Present Value ("NPV") of the Estimated
Net Operating Income ("Estimated NOI") of the Company.
The Estimated NOI calculation
begins with an estimation of cash flow. Cash flow comes from distributions from
Projects, interest payments from Loans and interest earned from Company
Investments. To estimate Project cash flow, we estimate monthly energy produced
by each Project using predictive software called PVsyst. PVsyst is a vital tool
in the solar industry for designing and simulating the performance of
photovoltaic systems. Its comprehensive features enable precise predictions of
solar power generation ("kWh"), considering a wide range of variables
and site-specific conditions. To estimate monthly revenue for each Project, the
energy rate described in the Power Purchase Agreement ("Energy Rate") is
multiplied by kWh throughout the term of the Power Purchase Agreement. We then
deduct the expected Project Operating Expenses to determine the cash available
for distribution to the Company from the Projects (see "Our Operating Costs
and Expenses - Project operating expenses"). In addition, to the cash
available for distribution from the Projects, in determining the Estimated NOI,
we add any anticipated interest payments from Loans and Company Investments.
We then deduct all of the
expected operating expenses at the Company level (see "Our Operating Costs
and Expenses - Company Operating Expenses") from the revenue. These
expenses are fairly easy to estimate as they are either consistent and
predictable (like a bank fee) or fixed by contract (like a Project Maintenance
Contract). By subtracting the estimated operating costs and expenses from the estimated
revenue, we establish a monthly Estimated NOI. We then use an XIRR calculation
to compute the NPV of that Estimated NOI using the Company's IRR as the
discount rate in the NPV equation. For example, if the Estimated NOI would
result in a 12% IRR, we use 12% as the discount rate when calculating the NPV
of the Estimated NOI.
Therefore, the NPV of the Estimated
NOI using the IRR as the discount rate establishes the NPV of the Company. When
we divided the NPV of the Company by the number of outstanding Class A Investor
Shares, we arrive at a price per share.
Investors will have no right to
vote or otherwise participate in the management of the Company. Instead, the
Company will be managed by the General Partner exclusively.
The
Company is governed by a Limited Partnership Agreement dated June 10, 2025 (the
"LP Agreement"). A copy of the LP Agreement can be found here. The
Class A Investor Shares being offered were created by the General Partner under
an Authorizing Resolution pursuant to Section 3.01 of the LP Agreement. A copy
of the Authorizing Resolution can be found here.
The LP Agreement establishes
Energea Global LLC, a Delaware limited liability company, as the General
Partner.
Page 34
The following summarizes some of
the key provisions of the LP Agreement and the Authorizing Resolution. This
summary is qualified in its entirety by the LP Agreement itself, a copy of
which can be found here, and by the Authorizing Resolution itself, a
copy of which can be found here.
The Company was formed in
Delaware on March 11, 2021, pursuant to the Delaware Limited Liability Company
Act. On June 10, 2025, the Company converted from a Delaware limited liability
company to a Delaware limited partnership, pursuant to the Delaware Revised
Uniform Partnership Act (the "Delaware LP Act").
Under the LP
Agreement, ownership interests in the Company are referred to as "Share",
while the owners, are referred to as "Limited Partners".
The General Partner adopted the
Authorizing Resolution to create the "Class A Investor Shares". Any
Investor who buys Class A Investor Shares in the Offering will be a "Limited
Partner" under the LP Agreement.
The interests in the Company are denominated
by 501,000,000 "Shares". The General Partner may further divide the
500,000,000 Investor Shares into one or more series, by adopting one or more
authorizing resolutions.
The Class A Investor Shares will
be owned by Investors and are the subject of this Offering. By adopting other
authorizing resolutions, the General Partner may create, offer, and sell other
classes of Investor Shares in the future, which could have rights superior to
the rights of the Class A Investor Shares.
The General Partner has complete
discretion over all aspects of the business conducted by the Company. For
example, the General Partner may (i) create classes of Shares with such terms
and conditions as the General Partner may determine in its sole discretion;
(ii) issue Shares to any person for such consideration as the General Partner
maybe determine in its sole discretion, and admit such persons to the Company
as Limited Partners; (iii) engage the services of third parties to perform
services on behalf of the Company; (iv) enter into one or more joint ventures;
(v) purchase, lease, sell, or otherwise dispose of real estate and other assets
including Projects or Loans, in the ordinary course of business or otherwise;
(vi) enter into leases and any other contracts of any kind; (vii) incur
indebtedness on behalf of the Company, whether to banks or other lenders;
(viii) determine the amount of the Company's distributable cash (as described
herein), and, subject to any authorizing resolutions, the timing and amount of
distributions to Limited Partners; (ix) determine the information to be
provided to the Limited Partners; (x) grant mortgages, liens, and other
encumbrances on the Company's assets; (xi) make all elections under the Code
and the provisions of State and local tax laws; (xiii) file a petition in
bankruptcy; (xiv) discontinue the business of the Company; and (xv) dissolve
the Company.
Investors who purchase Class A
Investor Shares will not have any right to vote on any issue other than certain
amendments to the LP Agreement, or to remove the General Partner.
The General Partner can be
removed for "cause" under a procedure set forth in Section 5.06 of the LP
Agreement.[1]
The term "cause" includes:
·
An uncured breach of the LP Agreement by the General Partner; or
·
The bankruptcy of the General Partner; or
·
Certain misconduct on the part of the General Partner, if the individual
responsible for the misconduct is not terminated.
Page 35
A vote to remove the General
Partner for cause must be approved by Limited Partners owning at least seventy
five percent (75%) of the issued and outstanding Class A Investor Shares and
the Reg D Shares, voting together as a single class (the Class A Investor
Shares and the Reg D Shares being collectively referred to herein as the "Investor
Shares"). Whether "cause" exists would then be decided in arbitration
proceedings conducted under the rules of the American Arbitration Association,
rather than in a court proceeding.
These provisions are binding on
every person who acquires Class A Investor Shares, including those who acquire
Class A Investor Shares from a third party, i.e., not from the Company.
The LP
Agreement protects the General Partner and its employees and affiliates from
lawsuits brought by Investors. For example, it provides that the General
Partner will not be liable to the Company for mistakes, errors in judgment, or
other acts or omissions (failures to act) as long as the act or omission was
not the result of the General Partner's fraud or willful misconduct under the
LP Agreement. This limitation on the liability of the General Partner and other
parties is referred to as "exculpation."
The LP Agreement also requires
the Company to indemnify (reimburse) the General Partner, its affiliates, and
certain other parties from losses, liabilities, and expenses they incur in
performing their duties. For example, if a third party sues the General Partner
on a matter related to the Company's business, the Company would be required to
indemnify the General Partner for any losses or expenses it incurs in
connection with the lawsuit, including attorneys' fees. However, if it is
judicially determined that such General Partner is not entitled to be
exculpated under the standard described in the preceding paragraph by the LP
Agreement, the General Partner shall promptly reimburse the Company for any
reimbursed or advanced expenses.
Notwithstanding the foregoing, no
exculpation or indemnification is permitted to the extent such exculpation or
indemnification would be inconsistent with the requirements of federal or state
securities laws or other applicable law.
The detailed rules for
exculpation and indemnification are set forth in section 6.02 of the LP
Agreement.
Once an Investor pays for his,
her, or its Class A Investor Shares, the Investor will have no obligation to
make further contributions to the Company (except for the return of
distributions under certain circumstances as required by Sections 17-607 and 17-804
of the Delaware LP Act, as described in more detail under "Liability To Make
Additional Contributions" below.
No Investor will be personally
liable for any of the debts or obligations of the Company.
The manner in which the Company
will distribute its available cash is described in "Securities Being Offered
- Calculating Distributions".
In general, Investors may freely
transfer their Class A Investor Shares. However, if an Investor wants to sell
Class A Investor Shares, the Investor may only offer the Class A Investor
Shares to the General Partner via the Platform. The General Partner generally
has a first right of refusal to purchase Class A Investor Shares pursuant to
Article 8 of the LP Agreement. See "Risk Factors-No Market for the Class A
Investor Shares; Limits on Transferability."
Page 36
If an Investor who is a human
being (as opposed to an Investor that is a legal entity) should die or become incapacitated,
the Investor or his, her or its successors will continue to own the Investor's
Class A Investor Shares.
The Company will pay certain
management fees and other fees to the General Partner, as summarized in "Compensation
of General Partner".
The General Partner may require an Investor to sell his,
her, or its Class A Investor Shares back to the Company:
·
If the Investor is an entity governed by the Employee Retirement Income
Security Act of 1974, Code section 4975, or any similar Federal, State, or
local law, and the General Partner determines that all or any portion of the
assets of the Company would, in the absence of the redemption, more likely than
not be treated as "plan assets" or otherwise become subject to such laws.
·
If the General Partner determines that the Investor has engaged in
certain misconduct described in the LP Agreement.
If an Investor's Class A Investor
Shares are purchased by the Company as provided above, the price will be equal
to 90% of the then-current share price of such Class A Investor Shares as
published on the Platform.
The purchase price will be paid
by wire transfer or other immediately available funds.
If the General Partner wants to
sell the business conducted by the Company, it may affect the transaction as a
sale of the Project owned by the Company or as a sale of all the Shares in the
Company. In the latter case, Investors will be required to sell their Class A
Investor Shares as directed by the General Partner, receiving the same amount
they would have received had the transaction been structured as a sale of
assets.
All documents, including all tax-related
documents, will be transmitted by the Company to Investors via email and/or
through the Platform.
The General Partner may amend the
LP Agreement unilaterally (that is, without the consent of anyone else) for a
variety of purposes, including to:
·
Cure ambiguities or inconsistencies in the LP Agreement;
·
Add to its own obligations or responsibilities;
·
Conform to this Offering Circular;
·
Comply with any law;
·
Ensure that the Company isn't treated as an "investment company" within
the meaning of the Investment Company Act of 1940;
·
Do anything else that could not reasonably be expected to have a
material adverse effect on Investors.
Page 37
An amendment that has, or could
reasonably be expected to have a material adverse effect on Investors, requires
the consent of the General Partner and Investors holding a majority of the
Class A Investor Shares.
An amendment that would require
an Investor to make additional capital contributions, delete or modify any
amendments listed in Section 11.03 of the LP Agreement or impose personal
liability on an Investor requires the consent of the General Partner and each
affected Investor.
Within a reasonable period after
the end of each fiscal year of the Company, the General Partner will provide
Investors with (i) a statement showing in reasonable detail the
computation of the amount distributed, and the manner in which it was distributed
(ii) a balance sheet of the Company, (iii) a statement of income and expenses,
and (iv) such additional information as may be required by law. The financial
statements of the Company need not be audited by an independent certified
public accounting firm unless the General Partner so elects or the law so
requires. While the Company currently maintains audited financial statements,
under the LP Agreement, the Company is not required to maintain audited
financial statements unless the General Partner so elects or the law so
requires.
As a "tier 2" issuer under
Regulation A, the Company will also be required to provide investors with additional
information on an ongoing basis, including annual audited financial statements,
annual reports filed on SEC Form 1-K, semiannual reports filed on SEC Form
1-SA, special financial reports filed on SEC Form 1-K, and current reports on
SEC Form 1-U. If, however, our Class A Investor Shares are held "of record" by
fewer than 300 persons, these reporting obligations could be terminated.
A Member's right to see
additional information or inspect the books and records of the Company is
limited by the LP Agreement.
Distributions made in liquidation
of the Company will be made in the manner described "Calculating
Distributions", depending on whether the distributions consist of ordinary
operating cash flow or net capital proceeds.
The holders of the Class A
Investor Shares will not have preemptive rights. That means that if the Company
decides to issue securities in the future, the holders of the Class A Investor
Shares will not have any special right to buy those securities.
Once an Investor pays for his,
her, or its Class A Investor Shares, the Investor will have no obligation to
make further contributions to the Company (except for the return of
distributions under certain circumstances as required by Sections 17-607 and 17-804
of the Delaware LP Act).
Under Section 17-607 of the
Delaware LP Act, a limited partnership may not make a distribution to a partner
if, after the distribution, all liabilities of the limited partnership, other
than liabilities to partners on account of their partnership interests and
liabilities for which the recourse of creditors is limited to specific property
of the limited partnership, would exceed the fair value of the assets of the
limited partnership. The Delaware LP Act provides that a partner who receives a
distribution and knew at the time of the distribution that the distribution was
in violation of Section 17-607 of the Delaware LP Act shall be liable to the
limited partnership for the amount of the distribution for three years.
Under Section 17-804 of the
Delaware LP Act, a limited partnership is required to distribute its assets:
(i) first to creditors, to the extent otherwise permitted by law, in
satisfaction of the limited partnership's liabilities other than liabilities
for which payment has been made and distributions to partners and former
partners; (ii) unless otherwise provided in its limited partnership agreement,
to partners and former partners in satisfaction of liability for distributions
under the Delaware LP Act; and (iii) unless otherwise provided in its limited
partnership agreement, to partners first for the return of their contributions
and second respecting their partnership interests, in the portions in which
they share in distributions. The Delaware LP Act provides that a member who
receives a distribution and knew at the time of the distribution that the
distribution was in violation of Section 17-804 of the Delaware LP Act shall be
liable to the limited partnership for the amount of the distribution for three years.
Page 38
In some situations, the General
Partner might be required by law to withhold taxes and/or other amounts from
distributions made to Investors. The amount we withhold will still be treated
as part of the distribution. For example, if we distribute $100 to an Investor
and are required to withhold $10 in taxes, for our purposes the Investor will
be treated as having received a distribution of $100 even though only $90 was
deposited in the Investor's bank account.
At this time, all Investors are
U.S. persons for all federal tax purposes. To the extent at any point in the
future any Investors may be non U.S. persons, the distributions to Investors
may subject to additional tax withholding and other reporting requirements.
The Company can only distribute
as much cash flow as the Company has available for distributions (see "Distributions").
There is no guarantee that the Projects will generate enough cash flow, after
paying expenses, to distribute enough to pay a positive return to Investors or
even to return all their invested capital.
Investors should note that the General
Partner may, in its sole discretion, amend, suspend,
or terminate the Redemption Plan at any time without prior notice for any
reason, and the General Partner reserves the
right to reject any Redemption Request at any time for any reason.
Our Class A Investor Shares are
currently not listed on a national securities exchange or included for
quotation on a national securities market, and currently there is no intention
to list our Class A Investor Shares. While Investors should view an investment
in the Company as long-term, we are adopting a redemption plan ("Redemption
Plan") whereby an Investor has the opportunity to obtain liquidity.
At any time after sixty (60) days
following the purchase of Class A Investor Shares, an Investor may request
redemption of their Class A Investor Shares in accordance with the Company's
Redemption Plan as set forth herein.
In order to submit a redemption
request ("Redemption Request") Investors must (1) submit a time-stamped
request via the Platform, (2) have no more than one outstanding request at any
given time, and (3) request that the Company redeem no more than $50,000 worth
of Class A Investor Shares per request. In addition, the Redemption Plan is
subject to certain liquidity limitations, which may fluctuate depending on the
liquidity of the Company. We reserve the right to reject any Redemption Request
at any time to protect our operations and our non-redeemed Investors, to
prevent an undue burden on our liquidity, or for any other reason, including,
what we deem to be a pattern of excessive, abusive or short-term trading.
As calculated below, the
redemption price ("Redemption Price") may be reduced by a discount based
on the time of the Redemption Request, rounded down to the nearest cent. The
Redemption Price will be equal to (i) the current price of the Class A Investor
Shares in effect at the time the Redemption Request is made, reduced by (ii)
the aggregate sum of distributions, if any, with record dates during the period
between the Redemption Request date and the redemption date. The current price
of the Class A Investor Shares is published on the Platform, and Investors will
be informed of the estimated Redemption Price at the time a Redemption Request
is submitted, subject to the adjustment for distributions described above.
Page 39
Based on the time when an
Investor submits a Redemption Request, the Redemption Prices are set forth
below:
|
Holding Period from Date
of Settlement
|
Redemption Price (as
percentage of per share redemption price)(1)
|
|
|
Settlement date to 60 days
|
No Redemptions
|
|
|
60 days to 3 years
|
95.0
|
% (2)
|
|
More than 3 years
|
100.0
|
% (3)
|
(1) The Redemption Price
will be the per share price for our Class A Investor Shares in effect as
of the time the Redemption Request is made (i) reduced by any distributions, if
any, with record dates during the period between the Redemption Request date
and the redemption date and (ii) rounded down to the nearest $0.01.
(2) For Class A Investor Shares held
between 60 days and three (3) years, the Redemption Price includes a fixed 5.0%
discount based on the per share price for our Class A Investor Shares in effect
at the time of the Redemption Request.
(3) There is no discount to
redemptions of Class A Investor Shares held at least three (3) years.
Investors may withdraw
their Redemption Request at any time before the redemption is paid. If we agree
to honor a Redemption Request, such Redemption Request will be paid within 90
days.
In light of the SEC's current
guidance on redemption plans, we generally intend to limit redemptions in any
calendar quarter to Class A Investor Shares whose aggregate value is 5.00% of
the NAV of all of our outstanding Class A Investor Shares on the last business
day of the preceding quarter, with excess capacity carried over to later
calendar quarters in that calendar year, up to a maximum of 20.00% of the NAV
of all of our Class A Investor Shares outstanding during any calendar year.
Notwithstanding the foregoing, we are not obligated to redeem Class A Investor
Shares under the Redemption Plan.
We cannot guarantee that the
funds, if any, set aside for the Redemption Plan will be sufficient to
accommodate all Redemption Requests. In the event our General Partner
determines, in its sole discretion, that we do not have sufficient funds
available to redeem all of the Class A Investor Shares for which Redemption
Requests have been submitted, such pending Redemption Requests will be honored
on a first in first out basis, if at all. In the event that not all Redemption
Requests are being honored in a given quarter, due to reaching the 5.00%
quarterly limit or otherwise, the Redemption Requests not fully honored will
carry over to the first business day of the next quarter and Investors will not
need to submit a new Redemption Request the following quarter. Investors will
be notified within 10 days of submitting a Redemption Request whether their
request for Redemption has been accepted or denied.
We intend to limit Investors to
one (1) Redemption Request outstanding at any given time, meaning that, if an
Investor desires to request more or less Class A Investor Shares be redeemed,
such Investor must first withdraw the first Redemption Request. For Investors
who hold Class A Investor Shares with more than one record date, Redemption
Requests will be applied to such Class A Investor Shares in the order in which
they settled, on a first in first out basis - meaning, those Class A Investor
Shares that have been continuously held for the longest amount of time will be
redeemed first. In addition, we intend to limit Redemption Requests to $50,000
worth of Class A Investor Shares per Redemption Request.
In addition, our General Partner
may, in its sole discretion, amend, suspend, or terminate the Redemption Plan
at any time without prior notice, including to protect our operations and our
non-redeemed Investors, to prevent an undue burden on our liquidity, following
any material decrease in our NAV, or for any other reason. In the event that we
suspend our Redemption Plan, we expect that we will reject any outstanding
Redemption Requests and do not intend to accept any new Redemption Requests. In
the event that we amend, suspend or terminate our Redemption Plan, we will file
an Offering Circular supplement and/or Form 1-U, as appropriate, and post such
information on the Platform to disclose such action. Therefore, you may not
have the opportunity to make a Redemption Request prior to any potential
termination of our Redemption Plan.
Rights of Common Shares
Investors will own all the Class
A Investor Shares while the General Partner will own all the Common Shares. The
principal rights associated with the Common Shares are as follows:
·
Distributions: As the holder of the Common Shares, the
General Partner will be entitled to the distributions of the Carried Interest.
·
Voting Rights: The Common Shares will have no voting rights per
se. However, the General Partner, in its capacity as the general partner of
the Company, will control the Company.
·
Obligation to Contribute Capital: Holders of the Common Shares
will have no obligation to contribute capital to the Company.
·
Redemptions: Holders of the Common Shares will have no right to
have Common Shares redeemed.
Page 40
The Company has four classes of Reg D Shares reserved for
issuance to Reg D Investors in accordance with a private placement offering
under Regulation D. The principal rights associated with the Reg D Shares are
as follows:
- Distributions: As the holder of the Reg D Shares, Reg D Investors will be entitled to receive distributions with Investors on a pari passu basis.
- Voting Rights: The Reg D Shares will have no voting rights.
- Obligation to Contribute Capital: Reg D Investors will have no obligation to contribute capital to the Company.
- Redemptions: Reg D Shares will have the same redemption rights as Class A Investor Shares.
To buy Class A Investor Shares,
go to the Platform and follow the instructions. You will be asked for certain
information about yourself, including:
·
Your name and address
·
Your email address
·
Your social security number (for tax reporting purposes)
·
Whether you are an "accredited investor"
·
If you not an accredited investor, your income and net worth
You will also be asked to sign an
Investment Agreement, a copy of which is available here.
To the extent you wish to
participate in the Offering by automatically investing on a periodic basis, you
will be asked to sign an Auto-Invest Agreement, a copy of which is available here.
To the extent you wish to
participate in the Offering by electing to use the amount of distributions that
you receive to purchase additional Class A Investor Shares, you will be asked
to sign an Auto-Reinvestment Agreement, a copy of which is provided here.
The minimum investment is
$100. You will pay for your Class A Investor Shares using one of the options
described on the Platform.
The information you submit,
including your signed Investment Agreement, is called your "subscription." The
General Partner will review your subscription and decide whether to accept it.
The General Partner has the right to accept or reject subscriptions in our sole
discretion, for any reason or for no reason.
When you invest, your money will
be held in an escrow account with a third party until your subscription is
reviewed and the General Partner decides whether to accept it. When and if the
General Partner confirms that your subscription is complete and decided to
accept your subscription, the General Partner will release your money from the
escrow account to the Company.
Once the General Partner has
accepted your subscription, you will be notified by email and the investment
process will be complete. The General Partner will also notify you by email if
it does not accept your subscription, although it might not explain why.
Page 41
You will not be issued a paper
certificate representing your Class A Investor Shares.
Anyone can buy Class A Investor Shares.
The General Partner does not intend to limit investment to people with a
certain income level or net worth, although there are limits on how much
non-accredited investors may invest in this Offering.
As long as an Investor is at
least 18 years old, they can invest in this Offering. But if the Investor not
an "accredited" investor, the amount they can invest is limited by law.
Under 17 CFR §230.501, a
regulation issued by the SEC, the term "accredited investor" means:
·
A natural person who has individual net worth, or joint net worth with
the person's spouse, that exceeds $1 million at the time of the purchase,
excluding the value of the primary residence of such person;
·
A natural person with income exceeding $200,000 in each of the two most
recent years or joint income with a spouse exceeding $300,000 for those years
and a reasonable expectation of the same income level in the current year;
·
A trust with assets in excess of $5 million, not formed for the specific
purpose of acquiring the securities offered, whose purchase is directed by a
sophisticated person;
·
A business in which all the equity owners are accredited investors;
·
An employee benefit plan, within the meaning of the Employee Retirement
Income Security Act, if a bank, insurance company, or registered investment
adviser makes the investment decisions, or if the plan has total assets in
excess of $5 million;
·
A bank, insurance company, registered investment company, business
development company, or small business investment company;
·
A charitable organization, corporation, or partnership, not formed for
the specific purpose of acquiring the securities offered, with total assets
exceeding $5 million; or
·
A director, executive officer, or general partner of the company selling
the securities, or any director, executive officer, or general partner of a
general partner of that issuer.
If the Investor falls within any
of those categories, then the Investor can invest any amount permitted on the
Platform. If the Investor does not fall within any of those categories, then
the most they can invest in this Offering is the greater of:
·
10% of their annual income; or
·
10% of their net worth.
These limits are imposed by law,
not by the Company.
The Company will determine
whether an Investor is accredited when he, she, or it creates an account on the
Platform.
Page 42
We have
filed with the SEC an offering statement under the Securities Act on
Form 1-A regarding this Offering. This Offering Circular, which is part of the offering statement, does not contain
all the information set forth in the offering statement and the exhibits
related thereto filed with the SEC, reference to which is hereby made. Upon the
qualification of the offering statement, we will be subject to the
informational reporting requirements that are applicable to Tier 2 companies
whose securities are qualified pursuant to Regulation A, and accordingly, we
will file annual reports, semi-annual reports and other information with the
SEC. The SEC maintains a website at www.sec.gov that
contains reports, information statements and other information regarding
issuers that file with the SEC.
The
information incorporated by reference herein is an important part of the
offering statement and this Offering Circular.
The following documents previously filed with the SEC are incorporated by
reference into the offering statement and this Offering Circular:
·
the Company's Annual Report for the fiscal year ended December 31,
2024 on Form
1-K
You may
review these filings on our website and may also request a copy of these
filings at no cost, by contacting us at:
ENERGEA PORTFOLIO 4 USA LP
52 Main Street
Chester, CT 06412
www.energea.com
(860)-316-7466
So long
as we remain subject to the periodic reporting requirements of Regulation A,
within 120 days after the end of each fiscal year we will file on the SEC's
EDGAR website an annual report on Form 1-K. The annual report will contain
audited financial statements and certain other financial and narrative
information that we are required to provide to investors.
We also
maintain a website at www.energea.com, where there may
be additional information about our business, but the contents of that site are
not incorporated by reference in or otherwise a part of this Offering Circular.
Certain legal matters with
respect to the Class A Investor Shares will be passed upon by the law firm of
McCarter & English, LLP headquartered in Newark, New Jersey.
The Company's financial
statements for the fiscal years ended December 31, 2024 and December 31, 2023
incorporated by reference in this Offering Circular have been audited by
Whittlesey PC, an independent registered public accounting firm, as stated in its
report appearing herein. The financial statements have been included in
reliance upon that firm's report on its authority as an expert in accounting
and auditing.
·
"Item 7. Financial Statements" of the Company's Annual Report on
Form 1-K for the fiscal year ended December 31, 2024, which can be found here.
which
is incorporated herein by reference.
|
3.8% NITT
|
A 3.8% Net Investment Income Tax
on certain investment income of individuals, trusts, and estates under
Section 1411 of the Internal Revenue Code.
|
|
Adjusted NOI
|
The net operating income of the Company after being
adjusted so that the IRR of the CAFD is equal to the Preferred Return rate of
6%
|
|
Advisers Act
|
Investment Advisers Act of 1940.
|
|
Ancillary Services
|
Support
services like operations, maintenance, and credit management provided to
solar projects.
|
|
Authorizing Resolution
|
The authorization adopted by the
General Partner pursuant to the LP Agreement that created the Class A
Investor Shares.
|
|
Blue Sky Laws
|
State-level
laws governing investments.
|
|
Borrower
|
A party that repays the Company
for a Loan through principal and interest payments.
|
|
CAFD
|
Cash
available for distribution by the Company.
|
|
Carried Interest
|
The right of the General
Partner to receive distributions under the LP Agreement, over and above its
right to receive distributions in its capacity as an Investor.
|
|
Class A Investor Shares
|
The
limited partnership interests in the Company being offered to Investors in
this Offering.
|
|
Code
|
The Internal Revenue Code of
1986, as amended (i.e., the Federal tax code).
|
|
Collateral Agreements
|
A
collection of agreements and instruments designed to secure obligations under
a primary financing arrangement between a borrower and a lender.
|
|
Company
|
Energea Portfolio 4 USA LP, a Delaware
limited partnership, which is offering to sell Class A Investor Shares in
this Offering.
|
|
Company Investments
|
Cash-on-hand
investments generating returns, such as interest from savings accounts.
|
|
Construction Contract
|
The contract whereby the
Company or an SPE will hire a third party to provide to provide engineering,
procurement, and construction services for a Project.
|
|
Customer
|
Offtaker
of electricity and environmental commodities.
|
|
Deferred Fees
|
Fees postponed by the General
Partner due to cash flow considerations, to be charged later at their
discretion.
|
|
Delaware LP Act
|
Governs
the formation and operation of Delaware limited partnerships.
|
|
DERMS
|
Distributed Energy Resource
Management Systems.
|
|
Development Company
|
A
company focused on acquiring and/or developing solar power projects.
|
|
Energea Global
|
Energea Global LLC, a Delaware
limited liability company, which is owned by Michael Silvestrini and Chris
Sattler and serves as the General Partner.
|
|
Energy Rate
|
The price
charged per unit of electricity consumed, usually measured in kilowatt-hours.
|
|
EPC
|
Engineering, Construction, and
Procurement
|
|
Estimated NOI
|
The
Net Operating Income estimated to be produced by the Company.
|
|
Exchange Act
|
Securities Exchange Act of 1934
|
|
Fees
|
Compensation
paid to the General Partner.
|
Page 44
|
FINRA
|
Financial Industry Regulatory
Authority, Inc.
|
|
Form 1-U
|
SEC form
used to report significant events or changes by companies under Regulation A.
|
|
General Partner
|
Energea Global LLC, a Delaware
limited liability company.
|
|
HSEC
|
Health,
Safety, Environment and Community
|
|
Investment Agreements
|
Contracts signed to purchase or
reinvest in Class A Investor Shares.
|
|
Investment Committee
|
A
multi-disciplinary committee of experienced renewable energy executives of
the General Partner which decides which Projects the Company will invest in.
|
|
Investors
|
Anyone who purchases Class A
Shares in the Offering.
|
|
Investor Shares
|
Combined
Class A Investor Shares and Reg D Shares held by Limited Partners, voting as
a single class.
|
|
IRA
|
Inflation Reduction Act of 2022
|
|
IRR
|
Internal
rate of return.
|
|
IRS
|
Internal Revenue Service
|
|
ITC
|
Investment
Tax Credit.
|
|
JOBS Act
|
The Jumpstart Our Business Startups Act of 2012
|
|
kWh
|
Kilowatt hour
|
|
Limited Partners
|
Owners of Investor Shares
|
|
LP Agreement
|
The
Company's Limited Partnership Agreement dated June 10, 2025.
|
|
Loan
|
Money lent from the Company to
a Development Company.
|
|
Loan Agreement
|
A
deal where the Lender provides funds to the Borrower up to a specified limit
over a set period.
|
|
MACRS
|
Modified Accelerated Cost
Recovery System
|
|
MTR
|
Minimum
Technical Requirement.
|
|
NAV
|
Net Asset Value.
|
|
NOI
|
Net
Operating Income.
|
|
NPV
|
Net Present Value.
|
|
Offering
|
The
offering of Class A Investor Shares to the public pursuant to this Offering
Circular.
|
|
Offering Circular
|
The Offering Circular you are reading
right now, which includes information about the Company and the Offering.
|
|
O&M
|
Operations
and Maintenance.
|
|
Partners
|
The General Partner and the
Limited Partners, collectively.
|
|
Platform
|
The
General Partner's website located at: www.energea.com.
|
|
Portfolio 2
|
Energea Portfolio 2 LP
|
|
Portfolio 3
|
Energea
Portfolio 3 Africa LP
|
|
Power Purchase Agreement
|
A contract where the SPEs sell
electricity generated by the projects directly to customers.
|
Page 45
|
PQA
|
This Post
Qualification Amendment.
|
|
Preferred Equity Investors
|
Holders of Class A and Reg D
Shares entitled to cash distributions after expenses.
|
|
Preferred Return
|
A 6%
per year preferred to Class A Investors before the General Partner receives
the Carried Interest.
|
|
Prior Offering
|
The Company's previous
Regulation A offerings that were qualified by the SEC on July 1, 2021.
|
|
Project Maintenance Contract
|
A
contract with a third party engaged by the SPE to operate and maintain the
projects after construction.
|
|
Project
|
A solar power project acquired
or developed by the Company.
|
|
Purchase and Sale Agreement
|
A
contract used by the Company to acquire Project rights from a Development
Company.
|
|
Purchase and Sale Agreements for Environmental Commodities
|
A contract used when SPEs sell
environmental commodities (e.g., renewable energy credits) produced by the
projects to customers.
|
|
RECs
|
Renewable
energy credits
|
|
Redemption Plan
|
The redemption plan whereby
Investors may request redemption of their Class A Investor Shares following
60 days after purchase.
|
|
Redemption Price
|
The
price at which Redemption Requests will be processed, based on the current
price per Class A Investor Shares at the time the Redemption Request is made,
reduced by the aggregate sum of distributions, if any, with record dates
during the period between the Redemption Request date and the redemption
date, and subject to a discount based on the time the Redemption Request is
submitted.
|
|
Redemption Request
|
A request for redemption
submitted through the Platform for up to $50,000 in Class A Investor Shares.
|
|
Reg D Investors
|
Accredited
investors participating in Reg D Offerings.
|
|
Reg D Offerings
|
Private securities offerings
under Rule 506(c), open only to accredited investors.
|
|
Reg D Shares
|
Shares
issued in Reg D Offerings.
|
|
Regulation A
|
SEC exemption that allows companies
to raise up to $75 million annually from the public with fewer disclosure
requirements than a traditional IPO.
|
|
Regulations
|
Regulations
issued under the Code by the Internal Revenue Service.
|
|
SEC
|
The U.S. Securities and Exchange
Commission.
|
|
Securities Act
|
The
Securities Act of 1933.
|
|
Shares
|
Ownership interest in the
Company.
|
|
Site Access
|
The
Company's legal right to enter a property to build and maintain a solar
project.
|
|
SPE
|
The entity we will create to
own and operate each Project, typically in the form of a Delaware limited
liability company.
|
|
Tax Equity
|
The
monetization of tax benefits through third-party transactions.
|
|
Tax Equity Agreements
|
An agreement that enables the
transfer of tax credits to a tax equity investor under U.S. incentive
programs.
|
|
Trust Agreement
|
A
fiscal control structure where Energea Global sets up a trust to collect
revenue from a borrower and oversee the repayment process.
|
|
U.S. GAAP
|
United States Generally Accepted
Accounting Principles.
|
|
U.S. Holder
|
A
beneficial owner of Class A Investor Shares that is a U.S. citizen or
resident, a U.S. corporation, a U.S. estate, or a U.S. trust as defined for
federal income tax purposes.
|
|
XIRR
|
Extended internal rate of
return
|
Page 46
|
Exhibit No.
|
Description of Exhibit
|
|
2.1**
|
Certificate
of Formation of the Company filed with the Delaware Secretary of State on
March 11, 2021 (incorporated by reference to the copy thereof filed as
Exhibit 1A-2A to the Company's Form 1-A filed January 11, 2024).
|
|
2.2**
|
Limited
Liability Company Agreement of the Company dated March 22, 2021 (incorporated by reference to the copy
thereof filed as Exhibit 1A-2B to the Company's Form 1-A filed January 11,
2024).
|
|
2.3**
|
Authorizing
Resolution of the Company dated March 22, 2021 (incorporated by reference
to the copy thereof filed as Exhibit 1A-2C to the Company's Form 1-A-2C filed
January 11, 2024).
|
|
2.4*
|
|
|
2.5*
|
|
|
2.6*
|
|
|
3.1**
|
Redemption
Plan (incorporated by reference to the copy of thereof filed as Exhibit
3.1 to the Company's Form 1-A filed April 2, 2024)
|
|
4.1**
|
Form
of Investment Agreement (incorporated by reference to the copy thereof
filed as Exhibit 3.1 to the Company's Form 1-A filed January 11, 2024).
|
|
4.2*
|
|
|
4.3*
|
|
|
4.4*
|
|
|
6.1**
|
Solar
Power Purchase Agreement between Phytoplankton Ponus Ridge Solar LLC and New
Canaan Public Schools dated December 2, 2020 (incorporated by reference
to the copy thereof filed as Exhibit 1A-4B to the Company's Form 1-A filed
January 11, 2024).
|
|
6.2**
|
Solar
Photovoltaic (PV) System Construction Agreement between Centurion Solar
Energy LLC and Phytoplankton Ponus Ridge Solar LLC dated December 4, 2020
(incorporated by reference to the copy thereof filed as Exhibit 1A-4C to the
Company's Form 1-A filed January 11, 2024).
|
|
6.3**
|
Operation
and Maintenance Agreement between Phytoplankton Ponus Ridge Solar LLC and
Plankton Asset Management LLC dated as of December 11, 2020 (incorporated
by reference to the copy thereof filed as Exhibit 1A-4D to the Company's Form
1-A filed January 11, 2024).
|
|
6.4**
|
Development
and Construction Management Agreement between Plankton Energy LLC and the
Company dated March 31, 2021 (incorporated by reference to the copy
thereof filed as Exhibit 1A-4E to the Company's Form 1-A filed January 11,
2024).
|
|
6.5**
|
Membership
Interest Purchase Agreement between Plankton Energy LLC and the Company dated
March 30, 2021 (incorporated by reference to the copy thereof filed as
Exhibit 1A-4F to the Company's Form 1-A filed January 11, 2024).
|
|
11.1*
|
|
|
11.2*
|
Consent of McCarter & English, LLP (included in
Exhibit 12)
|
|
12.1*
|
**Previously filed
Page 47
Pursuant to the requirements of
Regulation A, the issuer certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form 1-A and has duly
caused this offering statement to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of Chester, State of Connecticut, on June
16, 2024.
Energea Portfolio 4 USA LP
By: Energea Global LLC
By MICHAEL SILVESTRINI
Name: Mike Silvestrini
Title: Co-Founder and Managing Partner
Energea Global LLC
By: Energea Global LLC
By MICHAEL
SILVESTRINI
Name: Michael Silvestrini
Title: Co-Founder and Managing Partner
This Offering Statement has been signed
by the following persons in the capacities and on the dates indicated.
By MICHAEL SILVESTRINI
Name: Mike Silvestrini
Title: Co-Founder and Managing
Partner of Energea Global LLC (Principal Executive Officer, Principal Financial
Officer and Principal Accounting
Officer)
Date: June 16, 2024
Page 48