Wed, Apr

Transeastern Power Trust Announces Closing of Wind Project Acquisition and Debenture Financing

US Canada

Transeastern Power Trust ("Transeastern" or the "Trust") is pleased to announce that it has closed the previously announced acquisition of a 17.6 MW operational wind project located in Tulcea County, Romania (the "Baia Wind Project") and an unsecured convertible debenture financing for gross proceeds of approximately $3.0 million.

Mr. J. Colter Eadie, Chief Executive Officer of Transeastern, commented: "We are pleased to have closed the acquisition of the Baia Wind Project and the related financing. This acquisition represents a major milestone for Transeastern. The wind project, being our largest acquisition to date, is a proven and stable operation with over four years of consistent operating performance that will more than double our projected generation. We look forward to continuing to build on this momentum, having now increased Transeastern's generation capacity eight fold since going public just over two years ago."

The net purchase price of the Baia Wind Project of approximately EUR14.08 million ($20.3 million) was paid to the vendor by way of approximately EUR1.5 million ($2.2 million) cash, approximately EUR5.2 million ($7.5 million) in the form of a five year vendor take-back loan, the issuance of 14,790,136 units of the Trust ("Trust Units") at a deemed price of $0.70 per Trust Unit and the issuance of $2,071,000 principal amount of 7.5% convertible unsecured debentures governed by the debenture indenture dated May 28, 2014.

The Trust has issued, on a private placement basis, 4,233 units (each, a "Unit"), with each Unit being comprised of $1,000 principal amount of 7.5% unsecured convertible debentures and 800 Trust Unit purchase warrants (each, a "Warrant"), at a subscription price of $700 per Unit. A portion of the net proceeds of the private placement were used to complete the acquisition of the Baia Wind Project, with the balance being used for working capital and general corporate purposes.

Debentures with an aggregate principal amount of $4,233,000 were issued pursuant to the private placement, of which $625,000 were issued as initial debentures (the "Initial Debentures") pursuant to the debenture indenture dated May 28, 2014 and $3,608,000 were issued as series 2 debentures (the "Series 2 Debenture") pursuant to a first supplemental debenture indenture dated September 1, 2016. An aggregate of 3,386,400 Warrants were issued, with each Warrant being exercisable into one Trust Unit at an exercise price of $1.00 until May 28, 2019.

The Units containing Series 2 Debentures were issued pursuant to an agency agreement between Leede Jones Gable Inc. (the "Agent") and the Trust. In consideration for the services of the Agent and certain finders, the Trust paid a cash commission equal to 7% of the gross proceeds of the offering and issued 176,792 broker warrants ("Broker Warrants"), with each Broker Warrant being exercisable by the Agent into one Trust Unit for an exercise price of $1.00 until September 1, 2019.

About Transeastern

The Trust, through its direct and indirect subsidiaries in Canada, the Netherlands and Romania, has been formed to acquire interests in renewable energy assets in Romania, other countries in Europe and abroad that can provide stable cash flow to the Trust and a suitable risk-adjusted return on investment. The Trust seeks to provide investors with long-term, stable distributions, while preserving the capital value of its investment portfolio through investment, principally in a range of operational assets, which generate electricity from renewable energy sources, with a particular focus on solar and hydro power. The Trust intends to qualify as a "mutual fund trust" under the Income Tax Act (Canada) (the "Tax Act"). The Trust will not be a "SIFT trust" (as defined in the Tax Act), provided that the Trust complies at all times with its investment restriction which precludes the Trust from holding any "non-portfolio property" (as defined in the Tax Act).