Exhibit 10.1

AGREEMENT PROVIDING FOR THE SALE OF ALL OF THE SHARES OF ZEPHYR FARMS

LIMITED

THIS AGREEMENT MADE EFFECTIVE AS OF THE 24th day of August, 2011.

BETWEEN:

SCHNEIDER POWER INC.,

a corporation existing under the laws of the Province of Ontario

(hereinafter referred to as the “Purchaser”).

-and-

GREEN BREEZE ENERGY INC.,

a corporation existing under the laws of the Province of Ontario

(hereinafter referred to as the “Vendor”)

WHEREAS:

 

A. The Vendor is the owner of all of the issued and outstanding shares of Zephyr
Farms Limited (the “Corporation”).

 

B. The Corporation is currently developing a 10 MW wind farm in Brooke-Alvinston
Township in the Province of Ontario known as the Brooke-Alvinston Project
pursuant to the Renewable Energy Standard Offer Program of the Ontario Power
Authority.

 

C. The Vendor wishes to sell and the Purchaser wishes to purchase the Purchased
Shares (as hereinafter defined) subject to and in accordance with the terms and
conditions set out herein.

NOW THEREFORE THE PARTIES AGREE AS FOLLOWS:

ARTICLE 1

INTERPRETATION

 

  1.1 Definitions

In this Agreement and the Schedules hereto, in addition to the definitions
above, capitalized words and terms shall have the following meanings:

 

1.1.1 “Acquisition” means the purchase and sale of the Purchased Shares in
accordance with the terms hereof;

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1.1.2 “Affiliate” means, with respect to any specified Person, any person that
directly, or indirectly through one or more intermediaries, controls, is
controlled by or is under common control with such specified Person with the
terms “control” and “controlled” meaning for purposes of this definition, the
power to direct the management and policies of a Person, directly or indirectly,
whether through the ownership of voting securities or partnership or other
ownership interests, or by contract or otherwise;

 

1.1.3 “Agreement” means this agreement including all schedules and exhibits as
the same may be supplemented or amended from time to time;

 

1.1.4 “Applicable Law” means with respect to any Person, all laws (including
common law), by-laws, statutes, rules, regulations, principles of law, orders,
ordinances, judgments, decrees, guidelines, instruments, policies or other
requirements, whether domestic or foreign, and the terms and conditions of any
licence of any Governmental Authority as are applicable to such Person or its
business, undertaking, property or securities and emanate from a Governmental
Authority having jurisdiction over such Person or its business, undertaking,
property or securities;

 

1.1.5 “Balance of Plant Costs” has the meaning given to it in Subsection 2.3;

 

1.1.6 “Books and Records” means books, ledgers, files, lists, reports, plans,
logs, deeds, surveys, correspondence, operating records, Tax Returns and other
data and information, including all data and information stored on
computer-related or other electronic media, maintained with respect to the
Business and the Corporation;

 

1.1.7 “Brooke-Alvinston Project” or “Project” means the 10 MW wind energy
facility in Brooke-Alvinston Township in the Province of Ontario;

 

1.1.8 “Business” means the ownership, development, construction and operation of
the Brooke-Alvinston Project and all activities ancillary or incidental thereto;

 

1.1.9 “Business Day” means any day excluding a Saturday, Sunday or a statutory
holiday in the Province of Ontario, and also excluding any day on which the
principal chartered banks located in the City of Toronto are not open for
business during normal banking hours;

 

1.1.10 “Claim” means any claim, demand, action, cause of action, suit,
arbitration, investigation, proceeding, complaint, grievance, charge,
prosecution, assessment or reassessment, including any appeal or application for
review;

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1.1.11 “Closing” means the completion of the sale by the Vendor to and purchase
by the Purchaser of the Purchased Shares pursuant to this Agreement;

 

1.1.12 “Closing Date” means the later of (a) the fifth Business Day after the
first day by which each Party has delivered to the other, notice that the
conditions set out in Sections 5.1 and 5.2 have been satisfied and
(b) August 30, 2011; provided however that notwithstanding the foregoing, the
Closing Date shall be no later than September 30, 2011 or such other date as the
Purchaser and the Vendor may agree;

 

1.1.13 “Closing Time” means 1.00 p.m. (Eastern Standard Time) on the Closing
Date or any other time on the Closing Date as may be agreed by the Parties;

 

1.1.14 “Commercial Operation” has the meaning set out in the definitions under
the RESOP Agreement;

 

1.1.15 “Consulting Agreement” means the consulting agreement in the form
attached hereto as Exhibit C dated the date hereof between the Vendor and
Corporation with effect as of the Closing Date and which will, inter alia,
terminate the Development Agreement dated July 1, 2010 between the Vendor and
the Corporation;

 

1.1.16 “Contractual Consents” has the meaning given to it in Subsection
7.1.21(b);

 

1.1.17 “Encumbrance” means any security interest, mortgage, charge, pledge,
hypothec, lien, encumbrance, restriction, option, adverse claim, right of others
or other encumbrance of any kind;

 

1.1.18 “Environmental Laws” means any Laws relating to the Environment and
protection of the Environment, the regulation of chemical substances or
products, health and safety including occupational health and safety, and the
transportation of dangerous goods;

 

1.1.19 “Financial Statements” has the meaning given to it in Subsection 7.1.7;

 

1.1.20 “Governmental Authority” means any (a) multinational, federal,
provincial, territorial, state, regional, municipal, local or other government,
governmental or public department, court, tribunal, commission, board or agency,
domestic or foreign, or (b) regulatory authority, including any securities
commission or stock exchange;

 

1.1.21 “Governmental Regulation” means Applicable Law applicable to the
Corporation;

 

1.1.22

“Hazardous Substance” means any substance, waste, liquid, gaseous or solid
matter, fuel, micro-organism, sound, vibration, ray, heat, odour, radiation,

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  energy vector, plasma, organic or inorganic matter which is or is deemed to
be, alone or in any combination, hazardous, hazardous waste, solid or liquid
waste, toxic, a pollutant, a deleterious substance, a contaminant or a source of
pollution or contamination, regulated by any Environmental Laws;

 

1.1.23 “Independent Accountant” means an independent public accounting firm
mutually agreed upon by the Vendor and the Purchaser;

 

1.1.24 “Intellectual Property” means trade-marks and trade-mark applications,
trade names, certification marks, patents and patent applications, copyrights,
domain names, industrial designs, trade secrets, know-how, formulae, processes,
inventions, technical expertise, research data and other similar property, all
associated registrations and applications for registration, and all associated
rights, including moral rights;

 

1.1.25 “ITA” means the Income Tax Act (Canada);

 

1.1.26 “Losses” means any losses, liabilities, damages, costs (including but not
limited to reasonable legal fees), charges, expenses, actions, proceedings,
claims and demands, including fines and penalties howsoever arising and any Tax
payable in relation to such matters;

 

1.1.27 “Material Adverse Effect” means any change, effect, event, situation or
condition that, when considered either individually or in the aggregate together
with all other adverse changes or effects with respect to which such phrase is
used in this Agreement is materially adverse to the business, results of
operations, properties or condition (financial or otherwise) of the Business
taken as a whole; provided, however, that in determining whether there has been
a Material Adverse Effect, any adverse effect attributable to the following
shall be disregarded: (i) general economic, business or financial market
conditions, including without limitation, changes in the markets or industry in
which the Business operates; (ii) the announcement or pendency of the
transactions contemplated by this Agreement; or (iii) the breach by the
Purchaser of this Agreement;

 

1.1.28 “Material Contract” means a Contract that:

 

  (a) involves or may result in the payment of money or money’s worth by or to
the Corporation or to the Vendor on behalf of the Corporation in an amount in
excess of $25,000;

 

  (b) has an unexpired term of more than 2 years (including renewals);

 

  (c) cannot be terminated without penalty upon less than 30 days’ notice; or

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  (d) the termination of which, or under which the loss of rights, would
constitute a Material Adverse Effect.

 

1.1.29 “OPA” means the Ontario Power Authority;

 

1.1.30 “Ordinary Course” means with respect to an action taken by a Person, that
such action is consistent with the past practices of the Person and is taken in
the ordinary course of the normal day-to-day operations of such Person;

 

1.1.31 “Parties” means collectively, the Vendor and the Purchaser and “Party”
means any one of them;

 

1.1.32 “Permit” means the authorizations, registrations, permits, certificates
of approval, approvals, grants, licences, quotas, consents, commitments, rights
or privileges (other than those relating to the Intellectual Property) issued or
granted by any Governmental Authority to the Corporation or the Vendor and which
are necessary for the conduct of the Business as it is presently conducted;

 

1.1.33 “Person” means an individual, body corporate, sole proprietorship,
partnership, trust, unincorporated association, unincorporated syndicate,
unincorporated organization, or another entity, and a natural person acting in
his or her individual capacity or in his or her capacity as executor, trustee,
administrator or legal representative, and any Governmental Authority;

 

1.1.34 “Personal Information” means any factual or subjective information,
recorded or not, about a consultant, officer, director, executive, client,
supplier or natural person or about any other identifiable individual, including
any record that can be manipulated, linked or matched by a reasonably
foreseeable method to identify an individual;

 

1.1.35 “Privacy Laws” means any laws that regulate the collection, use or
disclosure of Personal Information;

 

1.1.36 “Project Premises” means all of the lands and premises upon which the
Brooke-Alvinston Project is to be constructed;

 

1.1.37 “Purchased Shares” means the 1,000 common shares in the capital of the
Corporation;

 

1.1.38 “REA Permit” means a Renewable Energy Approval for the Brooke-Alvinston
Project to be issued by the Ontario Ministry of the Environment;

 

1.1.39 “Real Property Agreements” means those agreements listed in Schedule
7.1.23(b);

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1.1.40 “Regulatory Approvals” means those approvals, consents, authorizations,
exemptions, permits, rulings, sanctions, acknowledgements and other approvals of
Governmental Authorities (including the giving of notice and the lapse, without
objection, of a prescribed time under an Applicable Law that states that a
transaction may be implemented if a prescribed time lapses following the giving
of notice without an objection being made) of Governmental Authorities required
to be obtained in connection with the sale and purchase of the Purchased Shares
in accordance with this Agreement;

 

1.1.41 “Release” means to release, spill, leak, pump, pour, emit, empty,
discharge, deposit, inject, leach, dispose, dump or permit to escape;

 

1.1.42 “Remedial Order” means any remedial order, including any notice of
non-compliance, order, other complaint, direction or sanction issued, filed or
imposed by any Governmental Authority pursuant to Environmental Laws, with
respect to the existence of Hazardous Substances on, in or under Project
Premises, or any other properties, or the Release of any Hazardous Substance
from, at or on the Project Premises, or with respect to any failure or neglect
to comply with Environmental Laws;

 

1.1.43 “RES Canada” means RES Canada Construction L.P., the general contractor
for the Project;

 

1.1.44 “RESOP” means the Renewable Energy Standard Offer Program of the OPA;

 

1.1.45 “RESOP Agreement” means the RESOP contract in respect of the Project
dated June 5, 2008, as amended by an amending agreement dated February 10, 2011
and as may be further amended from time to time;

 

1.1.46 “Samsung” means Samsung Heavy Industries Co., Ltd.;

 

1.1.47 “Samsung Credit Agreement” means the Credit Agreement between the
Corporation, as borrower and Samsung, as lender, dated November 26, 2010 in
respect of the financing of the Project;

 

1.1.48 “Samsung Security” means the General Security Agreement dated
November 26, 2010 granted by the Corporation in favour of Samsung, the Limited
Resource Guarantee and Pledge Agreement dated July 20, 2010 between the Vendor,
the Corporation and Samsung, the Guarantee dated July 20, 2010 provided by
Oneworld Energy Inc. in favour of Samsung and the Pledge Agreement dated
July 20,2010 between Oneworld Energy Inc. and Oneworld Solar Corp. in favour of
Samsung;

 

1.1.49

“Tax” or “Taxes” means all taxes, duties, fees, premiums, assessments, imposts,
levies, rates, withholdings, dues, government contributions and

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  other charges of any kind whatsoever, whether direct or indirect, together
with all interest, penalties, fines, additions to tax or other additional
amounts, imposed by any Governmental Authority;

 

1.1.50 “Tax Return” means any return, report, declaration, designation,
election, undertaking, waiver, notice, filing, information return, statement,
form, certificate or any other document or materials relating to Taxes,
including any related or supporting information with respect to any of the
foregoing, filed or to be filed with any Governmental Authority in connection
with the determination, assessment, collection or administration of Taxes;

 

1.1.51 “Turbine Supply Agreement” means the Turbine Supply Agreement dated
June 30, 2010 between Samsung and the Corporation; and

 

1.1.52 “Vendor Receivable” means the sum of $259,116 owing by the Vendor to the
Corporation.

 

  1.2 Certain Rules of Interpretation.

 

1.2.1 In this Agreement, words signifying the singular number include the plural
and vice versa, and words signifying gender include all genders. Every use of
the word “including” in this Agreement is to be construed as meaning “including,
without limitation”.

 

1.2.2 The division of this Agreement into Articles and Sections, the insertion
of headings and the provision of a table of contents are for convenience of
reference only and do not affect the construction or interpretation of this
Agreement.

 

1.2.3 Wherever in this Agreement reference is made to a calculation to be made
in accordance with “GAAP”, the reference is to the generally accepted accounting
principles approved by the Canadian Institute of Chartered Accountants, or its
successor, applicable as at the date on which the calculation is made or
required to be made in accordance with GAAP.

 

1.2.4 References in this Agreement to an Article, Section, Schedule or Exhibit
are to be construed as references to an Article, Section, Schedule or Exhibit of
or to this Agreement.

 

1.2.5 Any money to be paid or tendered by one Party to another pursuant to this
Agreement must be paid by bank draft, certified cheque or wire transfer of
immediately available funds payable to the Person to whom the amount is due.
Unless otherwise specified, the word “dollar” and “$” sign refer to Canadian
currency, and all amounts to be advanced, paid or calculated under this
Agreement are to be advanced, paid or calculated in Canadian currency.

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1.2.6 If any payment is required to be made or other action is required to be
taken pursuant to this Agreement on a day which is not a Business Day, then such
payment or action shall be made or taken on the next Business Day. References to
times of the day are (unless otherwise expressly provided) to Eastern Standard
Time and references to a day are to a period of 24 hours running from midnight
on the previous day.

 

1.2.7 Unless otherwise specified, any reference in this Agreement to any statute
includes all regulations made under or in connection with that statute from time
to time, and is to be construed as a reference to that statute as amended,
supplemented or replaced from time to time.

 

1.2.8 Any reference in this Agreement to a Person includes its successors and
permitted assigns.

 

  1.3 Entire Agreement.

This Agreement constitutes the exclusive, final and entire agreement between the
Parties with regard to the subject matter hereof and supersedes all other
contemporaneous and prior agreements, understandings and information, whether
written or oral, express or implied, between the Parties with regard to the
subject matter hereof (including the letter of intent dated May 27, 2011 among
the Vendor and the Purchaser, which is hereby terminated and is no longer in
force or effect) and (along with the Schedules, Exhibits and other documents
delivered pursuant to this Agreement) is a complete and exclusive statement of
the terms of the agreement among the Parties with respect to its subject matter.

 

  1.4 Party Drafting Agreement.

The Parties hereto acknowledge that their respective legal counsel have reviewed
and participated in settling the terms of this Agreement, and the Parties hereby
agree that any rule of construction to the effect that any ambiguity is to be
resolved against the drafting Party shall not be applicable in the
interpretation of this Agreement.

 

  1.5 Knowledge and Materiality.

Where any statement, representation or warranty is qualified by the expression
“so far as the Vendor is aware” or “to the best of the knowledge, information
and belief of the Vendor” or words of like effect or refers to the Vendor’s
knowledge, awareness or belief, such statement, representation or warranty means
the actual knowledge of the officers and directors of the Vendor after having
made reasonable enquiry regarding the relevant subject matter from third
parties, including the Corporation’s legal and financial advisors.

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Where a definition, representation, warranty, covenant or other term hereunder
is qualified by the term “Material”, Material shall mean a matter or event which
individually or in combination with other matters or events has a value or
economic impact of not less than $25,000.

 

  1.6 Schedules and Exhibits.

The following Schedules and Exhibits are attached to and incorporated by
reference into this Agreement:

 

Schedule or Exhibit

   Subject Matter

Exhibits

Exhibit A

  

Limited Recourse Guarantee and Pledge Agreement

Exhibit B

  

Replacement Guarantee and Pledge

Exhibit C

  

Consulting Agreement

Exhibit D

  

Form of Mutual Release between the Vendor and the Corporation

Exhibit E

  

Form of Directors and Officers’ Release

Schedules

  

Schedule 2.3

  

Pro Forma Budget

Schedule 7.1.1(d)

  

Corporate Organization and Power of the Vendor

Schedule 7.1.7

  

Indebtedness

Schedule 7.1.8

  

Litigation

Schedule 7.1.13

  

Non-Competition

Schedule 7.1.15

  

Permits

Schedule 7.1.16

  

Matters which are not disclosed in the Books and Records and Financial
Statements

Schedule 7.1.17

  

Indebtedness

Schedule 7.1.18

  

Related Party Transactions

Schedule 7.1.19

  

Business Carried on in the Ordinary Course

Schedule 7.1.21

  

Material Contracts

Schedule 7.1.21(b)

  

Contractual Consents and Regulatory Approvals

Schedule 7.1.22

  

Bank Accounts and Attorneys

Schedule 7.1.23

  

Real Property

Schedule 7.1.24

  

Intellectual Property

Schedule 7.1.28

  

Environmental Matters

Schedule 7.1.29

  

Personal Information

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ARTICLE 2

PURCHASE AND SALE

 

  2.1 Agreement of Purchase and Sale

Subject to the terms and conditions of this Agreement, at the Closing, the
Purchaser will purchase and accept from the Vendor and the Vendor will sell,
assign, transfer and deliver to the Purchaser, all of its right, title and
interest in and to the Purchased Shares free and clear of all Encumbrances.

 

  2.2 Aggregate Purchase Price

Subject to the adjustment set out in Subsection 2.3 hereof, the aggregate
purchase price payable by the Purchaser to the Vendor for the Purchased Shares
(the “Aggregate Purchase Price”) shall be $2,500,000 (Two Million Five Hundred
Thousand Dollars). Such Aggregate Purchase Price shall be paid and satisfied by
the Purchaser to the Vendor as set forth below:

 

2.2.1 $800,000 (the “Closing Funds”) shall be paid on the Closing Date;

 

2.2.2 $500,000 shall be paid within eight (8) Business Days of issuance of the
REA Permit to the Corporation;

 

2.2.3 $400,000 shall be paid on the date that is eight (8) Business Days
following the date of delivery of a notice from the Purchaser to the Vendor
confirming that the Final Notice to Proceed has been delivered to RES Canada and
the amount due to RES Canada on the delivery of the Final Notice to Proceed has
been advanced to the Corporation under the Samsung Credit Agreement, and the
permits required to commence construction have been secured;

 

2.2.4 $300,000 shall be paid on the date that is eight (8) Business Days
following the date the Brooke – Alvinston Project has attained Commercial
Operation; and

 

2.2.5 subject to Subsections 2.3 and 2.4, the balance (the “Final Balance”) in
the aggregate amount of $500,000 (subject to any adjustments calculated in
accordance with Subsection 2.3) shall be paid on or before the thirtieth
(30th) Business Day (the “Adjustment Date”) following the date the
Brooke-Alvinston Project attains Commercial Operation.

 

  2.3 Post-Closing Adjustment of the Aggregate Purchase Price

 

2.3.1

Within 15 Business Days of attaining Commercial Operation, the Purchaser shall
provide to the Vendor, a certificate confirming the Balance of Plant Costs

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  (the “Balance of Plant Costs Certificate”) in respect of the Brooke-Alvinston
Project. For the purposes of this Agreement, the “Balance of Plant Costs” means
the total construction costs for the Brooke-Alvinston Project excluding all
costs of the Project relating to the Turbine Supply Agreement, refundable
deposits made to Hydro One Networks Inc. and the OPA, if any, any interest
accrued in respect of the Project, real property lease costs, management fees or
other amounts paid to the Purchaser or Persons who are not at arm’s length to
the Purchaser, depreciation and amortization, financing fees, and Taxes to be
calculated in accordance with the categories set forth in the 2011-2012 pro
forma budget attached hereto as Schedule 2.3.

 

2.3.2 In the event that the Balance of Plant Costs exceed $7,000,000, there
shall be a reduction in the Aggregate Purchase Price equal to such excess
provided that such price reduction shall not exceed $500,000.

 

  2.4 Disputes in respect of the Balance of Plant Costs

 

2.4.1 The Vendor shall have ten (10) Business Days from the date of delivery by
the Purchaser of the Balance of Plant Costs Certificate (such period, the
“Dispute Period”) to notify the Purchaser, in writing, as to whether the Vendor
agrees or disagrees with the Balance of Plant Costs (such written notice, the
“Dispute Notice”). If the Vendor fails to deliver a Dispute Notice to the
Purchaser during the Dispute Period, the Balance of Plant Costs as prepared by
the Purchaser shall be deemed to have been correctly prepared and shall be
binding upon the Parties.

 

2.4.2 If the Vendor delivers a Dispute Notice to the Purchaser during the
Dispute Period, the Vendor and the Purchaser shall, for a period of fifteen
(15) Business Days from the date the Dispute Notice is delivered to the
Purchaser (such period, the “Resolution Period”), use their respective best
efforts to amicably resolve the items in dispute. Any items so resolved shall be
deemed to be final and correct as so resolved and shall be binding upon each of
the Parties.

 

2.4.3

If the Vendor and the Purchaser are unable to resolve all of the items in
dispute during the Resolution Period, then either of them may refer the items
remaining in dispute to the Independent Accountant. Such referral shall be made
in writing to the Independent Accountant, copies of which shall concurrently be
delivered to the non-referring Party. The referring Party shall furnish the
Independent Accountant, at the time of such referral, with the Balance of Plant
Costs Certificate and the Dispute Notice. The Parties shall also furnish the
Independent Accountant with such other information and documents as the
Independent Accountant may reasonably request to resolve the items in dispute.
The Parties shall also, within ten (10) Business Days of the date the items in
dispute are referred to the Independent

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  Accountant, provide the Independent Accountant with a written notice (a
“Position Statement”) describing in reasonable detail their respective positions
on the items in dispute (copies of which will concurrently be delivered to the
other Party hereto).

 

2.4.4 If any Party fails to timely deliver its Position Statement to the
Independent Accountant, the Independent Accountant shall resolve the items in
dispute solely upon the basis of the information otherwise provided to them. The
Independent Accountant shall resolve all disputed items in a written
determination to be delivered to each of the Parties within twenty (20) Business
Days after such matter is referred to them; provided, however, that any delay in
delivering such determination shall not invalidate such determination or deprive
the Independent Accountant of jurisdiction to resolve the items in dispute. The
decision of the Independent Accountant as to the items in dispute shall be final
and binding upon the Parties and shall not be subject to judicial review. The
fees and expenses of the Independent Accountant incurred in the resolution of
any items in dispute shall be determined by the Independent Accountant and set
forth in its report and shall be borne by the Parties in proportion to the
aggregate dollar amount of items unsuccessfully disputed by each Party (as
finally determined by the Independent Accountant) bears to the aggregate dollar
amount of all disputed items.

 

2.4.5 In the event of the delivery of a Dispute Notice, the Purchaser shall pay
to the Vendor on the Adjustment Date an amount equal to the Final Balance minus
the amount that is in dispute.

 

2.4.6 Within ten (10) Business Days after the final determination of the Balance
of Plant Costs (whether through failure of the Vendor to timely deliver a
Dispute Notice, agreement of the Parties, or determination of the Independent
Accountant), the Purchaser shall pay the remaining unpaid portion, if any, of
the Final Balance to the Vendor.

 

2.4.7

Notwithstanding the foregoing, in the event that the Purchaser is unable to
complete the final accounting of costs within 15 Business Days of attaining
Commercial Operation by reason of not being able to obtain a final accounting of
costs from either Hydro One Networks Inc. or RES Canada, the dates referenced in
Subsections 2.3 and 2.4 shall be adjusted as may be agreed by the Parties to
reflect the delay in the completion of the final accounting; provided however
that if the final accounting is not completed within ninety (90) days of
attaining Commercial Operation, the Purchaser shall pay $500,000 to counsel for
the Purchaser, in trust, (the “Escrow Agent”) to be held on account of the
remaining unpaid portion of the Final Balance and to be remitted by the Escrow
Agent to the Vendor or the

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  Purchaser as appropriate once the Final Balance is determined. Any interest on
the funds held by the Escrow Agent shall be remitted to the Vendor and the
Purchaser in the same proportion as the principal amount.

 

  2.5 Pledge of Purchased Shares

Immediately following Closing, the Purchaser and the Vendor shall enter into a
pledge agreement (the “SPI Pledge”) which is substantially in the form of the
limited recourse guarantee and pledge agreement attached hereto as Exhibit A,
pursuant to which the Purchaser will pledge the Purchased Shares to the Vendor
as continuing security for the payment of portions of the Aggregate Purchase
Price which are not payable on Closing.

ARTICLE 3

CLOSING

 

  3.1 Closing

Upon and subject to the terms and conditions of this Agreement, the Closing of
the transactions contemplated by this Agreement will take place on the Closing
Date, at the offices of the Purchaser’s counsel, Macleod Dixon LLP, located at
Suite 2300, Toronto-Dominion Centre, TD Waterhouse Tower, 79 Wellington Street
West, Toronto, Ontario, M5K 1H1 or at such other place as the Parties may agree,
or by PDF or fax exchange of signatures.

 

  3.2 Steps to Close

Each Party covenants to use its reasonable commercial efforts to satisfy (or
cause the satisfaction of) the conditions precedent to its obligations hereunder
which are reasonably under its control and to take, or cause to be taken, all
other actions and to do, or cause to be done, all other things necessary, proper
or advisable under Applicable Laws and regulations to complete the Acquisition
in accordance with the terms of this Agreement.

ARTICLE 4

COVENANTS AND ACKNOWLEDGMENTS

 

  4.1 The Parties acknowledge and agree as follows:

 

4.1.1

on Closing, the Purchaser and the Corporation will deliver a limited recourse
guarantee and pledge agreement in favour of Samsung, substantially in the

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  form attached hereto as Exhibit B (the “Replacement Guarantee and Pledge”),
which will replace the Limited Recourse Guarantee and Pledge Agreement, dated
July 20, 2010 issued by the Vendor and the Corporation in favour of Samsung (the
“Existing Limited Recourse Guarantee and Pledge Agreement”);

 

4.1.2 on Closing, the Vendor and the Purchaser will enter into the consulting
contract which is substantially in the form attached hereto as Exhibit C (the”
Consulting Contract”) pursuant to which the Vendor will agree to act as
consultant for the Project; and

 

4.1.3 except pursuant to the SPI Pledge, the Vendor will not have a retained
interest in the Project under the Consulting Contract or otherwise.

 

  4.2 Certain Deliveries

 

4.2.1 The Vendor shall use its reasonable commercial efforts to obtain and
deliver prior to Closing or as soon as possible following Closing, the
following:

 

  (a) ESA certification;

 

  (b) CSA certification;

 

  (c) an Operation and Maintenance Agreement between the Corporation and
Samsung;

 

  (d) the Transport Canada Lighting Design in respect of the Project;

 

  (e) the Distribution Connection Agreement in respect of the Project; and

 

  (f) the second amendment to the RESOP Agreement in respect of the extension of
the maximum time period for the calculation and payment of liquidated damages by
200 days.

 

4.2.2 Following Closing, the Purchaser shall deliver or cause the Corporation to
deliver notice of change of control of the Corporation to the OPA.

 

  4.3 Carrying on Business during the Interim Period

During the period from the date of this Agreement to the Closing Date (the
“Interim Period”), the Vendor shall cause the Corporation to carry on the
Business in the Ordinary Course.

During the Interim Period, except as (i) expressly permitted herein, (ii) as may
be disclosed in the Schedules, or (iii) as the Purchaser shall consent to in
writing, the

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Vendor shall use its reasonable commercial efforts to preserve the business
organization, goodwill and material business relationships with other Persons
and for greater certainty, the Corporation shall in all material respects
conduct itself so as to keep the Purchaser fully informed as to the material
decisions or actions required or required to be made with respect to the
operation of the Business, and, without limiting the generality of the
foregoing, it will not, without the prior written consent of the Purchaser, such
consent not to be unreasonably withheld:

 

  (a) enter into any material transaction which is out of the Ordinary Course
provided however, the Corporation may enter into a Balance of Plant Engineering,
Procurement and Construction Contract and related escrow agreement
(collectively, the “EPC Agreement”) with RES Canada, which shall be
substantially in the form of the draft of the EPC Agreement which shall have
been reviewed and approved by the Purchaser, acting reasonably;

 

  (b) alter or amend its articles or by-laws other than in connection with the
transactions contemplated herein;

 

  (c) engage in any business enterprise or other activity materially different
from that carried on as of the date hereof;

 

  (d) redeem, purchase or offer to purchase any of the Purchased Shares;

 

  (e) enter into or modify any agreements, policies or arrangements with, or
grant any bonuses, salary increases or termination pay to, any of its officers
or directors other than pursuant to agreements in effect (without amendment) on
the date hereof;

 

  (f) acquire, directly or indirectly, any assets, including but not limited to
securities of other companies;

 

  (g) declare or pay any dividends or distribute any of its properties or assets
to the Vendor save and except for management fees to the Vendor in an amount
equal to the Vendor Receivable;

 

  (h) issue, sell, assign, transfer, pledge or otherwise deal with the Purchased
Shares;

 

  (i) amend, modify, or terminate any organizational document of the
Corporation;

 

  (j) sell, assign, transfer, license or lease any right in or to the Business;

 

  (k) amend, modify, extend or terminate, or fail to comply with, any Material
Contract;

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  (l) incur any indebtedness, obligation or liability, or acquire any interest
or asset, or make any investment in any business or asset, other than in the
Ordinary Course;

 

  (m) hire any employees or engage any consultants or contribute to any employee
benefit plan;

 

  (n) cancel or waive any material claim or right;

 

  (o) institute, compromise or settle any Claim or proceeding;

 

  (p) sell, pledge, lease, dispose of, grant any interest in, encumber or agree
to sell, pledge, lease, dispose of, grant any interest in or encumber any of its
assets;

 

  (q) other than as required by Applicable Laws make or change any Tax election,
change any annual Tax accounting period, adopt or change any method of Tax
accounting, amend any Tax Return, enter into any closing agreement, settle any
Tax claim or assessment, surrender any right to claim a Tax refund, offset or
reduce any Tax liability, or consent to any extension or waiver of the
limitations period applicable to any Tax claim or assessment;

 

  (r) make any change in accounting methods, principles or practices of the
Business, except insofar as may be required by a change in GAAP;

 

  (s) authorize, or commit to do or agree to take, in writing or otherwise, any
of the foregoing actions; and

 

  (t) not (without prior written consent of the Purchaser), directly or
indirectly: (i) initiate, solicit, cause, facilitate or participate in any offer
(confidential or otherwise) or expression of interest to acquire any assets of
the Corporation outside of the Ordinary Course or any of its issued or unissued
securities, whether directly or indirectly, induce, directly or indirectly, or
attempt to induce any other Person to initiate any shareholders proposal; or
(ii) except with regard to the Acquisition, pursue any other material
amalgamation, merger, arrangement or sale of assets of or for the Corporation or
make any other material change to the business, capital or affairs of the
Corporation.

 

  4.4 Notice During the Interim Period

Each Party will give prompt written notice to the other Party of any development
during the Interim Period causing, or which would reasonably be expected
(including with due notice or the passage of time) to cause, a breach of or
inaccuracy in any representations

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or warranties of any such Party in this Agreement, including if such
representations or warranties were given as of the time of such development.
Each Party will give prompt written notice to the other Party if it becomes
aware of the breach of any covenant given by such Party or the occurrence of any
event that makes the satisfaction of any of the conditions to Closing set forth
in this Agreement impossible or unlikely. No disclosure by a Party pursuant to
this Subsection 4.4 however, shall be deemed to amend or supplement the
Schedules to this Agreement or to prevent or cure any misrepresentation, breach
or inaccuracy of any warranty or breach or default under any covenant.

 

  4.5 Filings; Cooperation; Information

Promptly after the execution of this Agreement, each Party will prepare and make
(or cause to be prepared and made) all required filings, submissions and
notifications under the laws of any domestic or foreign jurisdictions to the
extent necessary to consummate the transactions contemplated by this Agreement.
In addition, each party shall promptly apply for and diligently seek the
consents required by each of them pursuant to Article 5 with a view to having
the conditions set out therein satisfied as soon as possible and each Party
shall promptly notify the other Party upon the satisfaction of each of the
conditions inserted for the benefit of such Party.

Subject to Applicable Laws and governmental regulations, each Party will
promptly consult with the other Party with regard to, and provide to the other
Party any necessary information and reasonable assistance, and copies of all
filings, submissions and notifications made and other information supplied by
such Party with or to any Governmental Authority in connection with this
Agreement or any of the transactions contemplated by this Agreement. Each Party
will furnish to all Governmental Authorities such necessary information and
reasonable assistance as such Governmental Authorities may reasonably request in
connection with the foregoing. Each Party will promptly furnish the other with
any communication it receives from any Governmental Authority in connection with
any filings made pursuant to this Subsection 4.5.

The Purchaser covenants and agrees with the Vendor that during the Interim
Period, the Purchaser will not contact, directly or indirectly, any Vendor
supplier or associate involved with the Brooke-Alvinston Project (regarding the
Project), including, without limitation, Samsung, RES Canada, RES Americas,
Stantec Consulting, Garrad Hassan, Hydro One Networks Inc., the OPA, the Ontario
Ministry of Energy, and the Ontario Ministry of Environment, without the consent
of the Vendor, which consent shall not be unreasonably withheld.

 

  4.6 Tax Returns

The Vendor will prepare or cause to be prepared on a timely basis, all Tax
Returns for the Corporation for any period which ends on or before the Closing
Date and for which

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Tax Returns have not been filed as of the Closing Date and provide such Tax
Returns to the Purchaser for execution and filing. The Purchaser will also cause
to be prepared and filed on a timely basis, all Tax Returns for the Corporation
for all periods following the Closing Date. The Vendor and the Purchaser will
co-operate fully with each other and make available to each other in a timely
fashion all available data and other information as may reasonably be required
for the preparation of all Tax Returns and will preserve such data and other
information until the expiration of any applicable limitation period for
maintaining Books and Records under any applicable Tax Law with respect to Tax
Returns.

ARTICLE 5

CONDITIONS TO CLOSING

 

  5.1 Conditions to the obligations of the Purchaser

The obligations of the Purchaser to complete the Acquisition are subject to the
fulfillment of the following conditions at or prior to the Closing Time:

 

5.1.1 the Vendor shall have complied with all agreements, obligations, covenants
and conditions required by this Agreement to be performed or complied with by it
at the Closing Time;

 

5.1.2 the pledge of the Purchased Shares by the Vendor in favour of Samsung
shall have been terminated;

 

5.1.3 the Vendor Receivable shall have been settled between the Corporation and
the Vendor in a manner that does not create any adverse tax consequences for the
Corporation;

 

5.1.4 no material adverse change in the business, affairs, financial condition
or operations of the Corporation shall have occurred in the Interim Period,
including any material adverse change to the (i) the preliminary wind resource
assessment prepared by Garrad Hassan on October 4, 2010, (ii) the anticipated
interconnections costs from Hydro One Networks Inc. in the amount of $716,000,
and (iii) the anticipated total capital costs of $23,016,551;

 

5.1.5 during the Interim Period, no action, suit or proceeding shall have been
taken by any Person against the Corporation (whether or not purportedly on
behalf of the Corporation) that would, if successful, have a Material Adverse
Effect on the Corporation or that would impose any condition or restriction upon
the Corporation (after giving effect to the Acquisition) which would so
materially adversely impact the economic or business benefits of the Acquisition
as to render inadvisable the consummation of the Acquisition;

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5.1.6 the board of directors and/or shareholders of the Purchaser, as
applicable, shall have adopted all necessary resolutions;

 

5.1.7 the lender to the shareholder of the Purchaser shall have approved the
Acquisition;

 

5.1.8 the RESOP Agreement shall be in good standing;

 

5.1.9 Samsung shall have consented to the Acquisition;

 

5.1.10 the Vendor shall have obtained and provided to the Purchaser:

 

  (a) confirmation from Samsung of the amounts outstanding under the Samsung
credit facility created by the Samsung Credit Agreement as of the Closing Date;

 

  (b) the revised Hydro One Connection Impact Assessment in respect of the
Project; and

 

  (c) the Hydro One Connection Cost Agreement in respect of the Project.

 

5.1.11 RES Canada shall have entered into the EPC Agreement with the
Corporation;

 

5.1.12 the Vendor shall have obtained or caused to be obtained and delivered to
the Purchaser a valid lease in respect of the Project Premises in form and
substance reasonably satisfactory to the Purchaser, which shall have been
registered on title to the subject properties;

 

5.1.13 the Vendor shall have obtained or caused to be obtained and delivered a
non-disturbance agreement from any mortgagee with a registered interest in the
Project Premises;

 

5.1.14 the board of directors and shareholders of the Corporation and Vendor
shall have adopted all necessary resolutions, and all other necessary corporate
action shall have been taken by the Corporation and the Vendor to permit the
consummation of the Acquisition;

 

5.1.15 the representations and warranties of the Vendor contained herein and in
any other agreement or document delivered pursuant to this Agreement shall be
true and accurate in all material respects (save and except for any
representation or warranty already qualified by materiality, which shall be true
and correct in all respects) as of the date of this Agreement and at and as of
the Closing Date, as though such representations and warranties were made at and
as of the Closing Date, except to the extent that any such representations and
warranties were made as of a specific date (and as to any such representations
and warranties, the same continue on the Closing Date to have been so true and
correct in all material respects as of such specified date); and

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5.1.16 the Vendor shall have furnished the Purchaser and the Purchaser shall
have received the documents and other deliveries called for by Subsection 6.1.1.

The foregoing conditions precedent are for the benefit of the Purchaser and may
be waived by the Purchaser, in whole or in part, without prejudice to its right
to rely on any other condition in favour of the Purchaser. If any of the said
conditions shall not have been satisfied by the Vendor or waived by the
Purchaser on or before the date required for their performance and provided such
non-compliance did not arise from acts or omissions of the Purchaser, the
obligations of the Purchaser to complete the Acquisition shall be at an end upon
written notice to the Vendor.

 

  5.2 Conditions to the obligations of the Vendor

The obligations of the Vendor to complete the Acquisition are subject to the
fulfillment of the following conditions on or before the Closing Time:

 

5.2.1 payment by the Purchaser of the Closing Funds;

 

5.2.2 each of the acts and undertakings of the Purchaser to be performed on or
before the Closing Date pursuant to the terms of this Agreement shall have been
duly performed by the Purchaser;

 

5.2.3 the board of directors and/or shareholders of the Vendor, as applicable,
shall have adopted all necessary resolutions, and all other necessary corporate
action shall have been taken by the Vendor to permit the consummation of the
Acquisition;

 

5.2.4 Samsung shall have consented to the Acquisition;

 

5.2.5 the Purchaser shall have furnished the Vendor with the documents and other
deliveries called for by Subsection 6.1.2; and

 

5.2.6 the representations and warranties of the Purchaser set forth in this
Agreement and any other document delivered pursuant to this Agreement shall be
true and accurate in all material respects as of the date of this Agreement and
at and as of the Closing Date as though such representations and warranties were
made at and as of the Closing Date, except to the extent that any such
representations and warranties were made as of a specified date (and as to any
such representations and warranties, the same continue on the Closing Date to
have been so true and correct in all material respects as of such specified
date).

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The foregoing conditions precedent are for the benefit of the Vendor and may be
waived by the Vendor, in whole or in part, without prejudice to the Vendor’s
right to rely on any other condition in favour of the Vendor. If any of the said
conditions shall not have been satisfied by the Purchaser or waived by the
Vendor on or before the date required for their performance and provided such
non-compliance did not arise from acts or omissions of Vendor, the Vendor’s
obligations to complete the Acquisition shall be at an end upon written notice
to the Purchaser.

 

  5.3 Mutual Conditions Precedent

The respective obligations of the Parties to consummate the transactions
contemplated herein are subject to the satisfaction, on or before the Closing
Date, of the following conditions any of which may be waived by the mutual
consent of such Parties without prejudice to their rights to rely on any other
or others of such conditions:

 

5.3.1 there shall not exist any prohibition at law against the completion of the
Acquisition; and

 

5.3.2 there shall not be in force any order or decree restraining or enjoining
the consummation of the Acquisition.

ARTICLE 6

CLOSING DELIVERABLES

 

6.1.1 On or prior to Closing, the Vendor shall deliver (or cause to be
delivered) the following in form and substance satisfactory to the Purchaser:

 

  (a) original share certificates representing the Purchased Shares, in fully
transferable form;

 

  (b) confirmation that the pledge of the Purchased Shares in favour of Samsung
has been terminated;

 

  (c) a certificate of an officer of the Corporation: certifying that attached
to such certificate are true and complete copies of (a) the constitutional
documents of the Corporation as amended through and in effect on the Closing
Date, (b) the by-laws of the Corporation, (c) resolutions of the Corporation’s
board of directors and if required, the shareholder authorizing the transfer of
the Purchased Shares;

 

  (d) a certificate of an officer of the Vendor confirming the amounts, if any,
that are owing to the contractors of the Corporation as of the Closing Date;

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  (e) a statement from Samsung confirming the amount owing under the credit
facility created by the Samsung Credit Agreement as of the Closing Date;

 

  (f) an estoppel certificate from the landowners of the lands and premises
constituting the Project Premises in form and substance reasonably satisfactory
to the Purchaser;

 

  (g) the Consulting Agreement, duly executed by the Vendor and the Corporation;

 

  (h) a certificate of an officer of the Vendor (1) certifying that attached to
such certificate are true and complete copies of the constitutional documents of
the Vendor, resolutions of the Vendor’s board of directors and, if required, its
shareholder(s), authorizing the execution, delivery and performance of this
Agreement and the related agreements to which the Vendor is a party and
(2) certifying as to the incumbency of the officer(s) of the Vendor executing
this Agreement and the related agreements to which the Vendor is a party;

 

  (i) duly executed resignations effective as at the Closing Time of each
director and officer of the Corporation specified by the Purchaser;

 

  (j) a mutual release between the Vendor and the Corporation substantially in
the form of the full and final release attached as Exhibit D, duly executed by
the Vendor and the Corporation;

 

  (k) mutual releases between the directors and officers of the Corporation and
the Corporation substantially in the form of the directors and officers release
attached as Exhibit E, duly executed by the directors and officers of the
Corporation and the Corporation;

 

  (l) a certificate of an officer of the Vendor in respect of the Vendor’s
compliance with the conditions to Closing set out in Subsections 5.1.1 and
5.1.15

 

  (m) a certificate of status or equivalent in respect of the Vendor, dated the
Closing Date;

 

  (n) a certificate of status or equivalent in respect of the Corporation, dated
the Closing Date;

 

  (o) all Books and Records of and related to the Corporation and the Business;

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  (p) a copy of the limited recourse guarantee issued by the Vendor in favour of
Samsung;

 

  (q) an undertaking of the Vendor to use reasonable commercial efforts to
obtain any third party consents which may be necessary for the assignment of
legal title to Permits, licences or Material Contracts issued in the name of the
Vendor as of the Closing Date, provided that any associated costs, charges and
expenses shall be borne by the Vendor;

 

  (r) a Project-specific insurance quote or binder;

 

  (s) all records, correspondence, documents, files, memoranda and other papers
belonging to the Corporation in the Vendor’s possession; and

 

  (t) all other agreements, documents, instruments and writings required or
contemplated to be delivered by the Vendor at or prior to the Closing pursuant
to this Agreement or otherwise in connection with the Acquisition.

 

6.1.2 On or prior to Closing, the Purchaser shall deliver (or cause to be
delivered) the following, in form and substance satisfactory to the Vendor:

 

  (a) a certificate of an officer of the Purchaser: (1) certifying that attached
thereto are true and complete copies of the constitutional documents and by-laws
of the Purchaser, (2) resolutions of the Purchaser’s board of directors
authorizing the execution, delivery and performance of this Agreement and the
related agreements to which the Purchaser is a party and (3) certifying as to
the incumbency of the officer(s) of the Purchaser executing this Agreement and
the related agreements to which the Purchaser is a party;

 

  (b) the SPI Pledge duly executed by the Purchaser;

 

  (c) the Replacement Guarantee and Pledge, duly executed by the Purchaser;

 

  (d) a certificate of an officer of the Purchaser in respect of the Purchaser’s
compliance with the conditions to Closing set out in Subsections 5.2.2 and
5.2.6; and

 

  (e) all other agreements, documents, instruments and writings required or
contemplated to be delivered by the Purchaser at or prior to the Closing
pursuant to this Agreement or otherwise in connection with the Acquisition.

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ARTICLE 7

REPRESENTATIONS AND WARRANTIES OF THE VENDOR

The Vendor hereby represents and warrants to and in favour of the Purchaser as
follows in this Article 7 and acknowledges that the representations and
warranties set forth below are a material inducement for the Purchaser entering
into this Agreement and completing the transactions contemplated by this
Agreement and are intended to be relied upon by the Purchaser.

 

7.1.1 Corporate Organization and Power of the Vendor

 

  (a) The Vendor is a corporation duly incorporated and validly existing under
the laws of the Province of Ontario and has all necessary corporate power to own
or lease its properties and to carry on its business as now being conducted.

 

  (b) The Vendor has all necessary corporate power and authority to enter into
this Agreement and perform its obligations hereunder.

 

  (c) This Agreement has been, and each additional agreement or instrument to be
delivered pursuant to this Agreement will be, duly authorized, executed and
delivered by the Vendor and each is or will be, a legal, valid and binding
obligation of the Vendor, enforceable against the Vendor in accordance with its
terms, subject to applicable bankruptcy, insolvency and other laws of general
application limiting the enforcement of creditors’ rights generally and to the
fact that equitable remedies, including specific performance, are discretionary
and may not be ordered in respect of certain defaults.

 

  (d) Except as disclosed in Schedule 7.1.1(d), the execution and delivery of
this Agreement and the completion of the transactions contemplated hereunder do
not and will not at the Closing Date:

 

  (i) result in a breach or violation of any term or provision of or constitute
a default under the articles or by-laws of the Vendor or the Corporation;

 

  (ii) conflict with, result in a breach of, constitute a default under or
accelerate the performance required by or result in the suspension,
cancellation, material alteration or creation of an Encumbrance upon any
Material Contract, licence, permit or authority to which the Vendor or the
Corporation is a party or by which either of them is bound or to which their
respective material assets or property are subject;

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  (iii) with the exception of the security interests in favour of Samsung and
the Vendor to be created by the Replacement Guarantee and Pledge Agreement and
the SPI Pledge respectively, result in the creation or imposition of any
Encumbrance on the Purchased Shares;

 

  (iv) require any Regulatory Approval or Contractual Consents; or

 

  (v) result in any violation of, be in conflict with, contravene, constitute a
default under, or give any Governmental Authority or other Person the right to
challenge or to exercise any remedy or obtain any relief under any Applicable
Law or any order served upon the Vendor or the Corporation or to which the
Vendor or the Corporation or any of their respective assets may be subject,
violate any provision of law or regulation or any judicial or administrative
order, award, judgment or decree applicable to the Vendor or the Corporation.

 

  (e) The Vendor is not an insolvent Person within the meaning of the Bankruptcy
and Insolvency Act (Canada) and has not initiated proceedings with respect to
compromise or arrangement with its creditors or for its winding up, liquidation
or dissolution and no receiver has been appointed in respect of it or in respect
of its assets and no execution or distress has been levied against its assets.

 

  (f) The Vendor is not a non-resident of Canada within the meaning of
Section 116 of the ITA.

 

7.1.2 Corporate Organization and Power of the Corporation; Solvency

 

  (a) The Corporation is a corporation duly incorporated and validly existing
under the laws of the Province of Ontario and has all necessary corporate power
to own or lease its properties and to carry on the Business as it is now being
conducted.

 

  (b) The Corporation is qualified to do business in the Province of Ontario.
Neither the character nor location of the properties owned or leased by the
Corporation or by the Vendor on behalf of the Corporation nor the nature of the
Business requires qualification to do business in any other jurisdiction.

 

  (c) The Corporation is duly licensed, registered and qualified to carry on its
Business in accordance with Applicable Law.

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  (d) The Corporation is not an insolvent Person within the meaning of the
Bankruptcy and Insolvency Act (Canada) and has not initiated proceedings with
respect to compromise or arrangement with its creditors or for its winding up,
liquidation or dissolution and no receiver has been appointed in respect of it
or in respect of its assets and no execution or distress has been levied against
its assets.

 

7.1.3 Capitalization

 

  (a) The Corporation’s authorized capital consists of an unlimited number of
common shares. The Purchased Shares represent the entire allotted and issued
capital of the Corporation. No other securities (such as bonds, convertible
bonds, warrants, profit certificates or other securities with or without voting
rights and with or without profit participation rights) have been authorized or
issued by the Corporation.

 

  (b) The Purchased Shares have been validly issued and are outstanding as fully
paid and non-assessable.

 

  (c) Other than this Agreement and the Existing Limited Recourse Guarantee and
Pledge Agreement which will terminate on Closing, there is no agreement,
arrangement or obligation requiring the creation, allotment, issue, sale,
transfer, redemption or repayment of, or the grant to a Person of the right
(conditional or not) to require the allotment, issue, sale, transfer, redemption
or repayment of, any share in the capital of the Corporation (including an
option or right of pre-emption or conversion).

 

7.1.4 Authorization to transfer the Purchased Shares

 

  (a) The Vendor is the legal and beneficial owner of the Purchased Shares and
has the absolute right, title and authority to sell, transfer and assign the
Purchased Shares to the Purchaser free and clear of all liens, charges,
mortgages, security interests, pledges, demands, Claims and other Encumbrances
whatsoever, except those restrictions on transfer arising under the articles of
incorporation of the Corporation and except for a security interest in favour of
Samsung pursuant to the Existing Limited Recourse Guarantee and Pledge Agreement
which will be terminated on Closing.

 

  (b) The transfer of the Purchased Shares by the Vendor to the Purchaser has
been duly and validly authorized by all required corporate actions of the Vendor
and/or the directors of the Corporation.

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7.1.5 Constitutional Documents

 

  (a) The copies of the constitutional documents of the Corporation which have
been delivered to the Purchaser are true and complete and set out in full the
rights and restrictions attaching to the share capital of the Corporation.

 

  (b) All resolutions, annual returns and other documents required to be
delivered to the Registrar of Companies or analogous authority in the
jurisdiction in which the Corporation is organized have been properly prepared
and filed, unless the failure to so file would not reasonably be expected to
have a Material Adverse Effect on the Corporation or the Business.

 

7.1.6 Subsidiaries and Interest in other Persons

 

  (a) The Corporation does not own or have any agreements of any nature to
acquire, directly or indirectly, any shares in the capital of or proprietary
interest in any Person. The Corporation does not have any agreements to acquire
or lease any other business operations.

 

  (b) The Corporation has no subsidiaries and does not own nor have any
obligation to acquire any securities or assets of any other Person.

 

7.1.7 Financial Statements

 

  (a)

The Corporation’s 2010 financial statements (the “Financial Statements”) and the
management prepared unaudited financial statements for the six-month period
ending on June 30th, 2011 (without notes and adjusting entries) which have been
delivered to the Purchaser prior to the date hereof have been prepared in
accordance with GAAP applied on a basis consistent with prior periods, are
correct and complete and present fairly the assets, liabilities (whether
accrued, absolute, contingent or otherwise) and financial condition of the
Corporation as at each balance sheet date and the revenues, earnings, and
results of operations of the Corporation for the periods that they cover. The
Financial Statements are accurate and complete in all material respects.

 

  (b) Except as set forth in Schedule 7.1.7 the Corporation is not engaged in
any financing of a type which would not be required to be shown or reflected in
the Financial Statements.

 

  (c)

Except to the extent reflected or reserved in the Financial Statements or
disclosed in Schedule 7.1.7, there are no liabilities or obligations of

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  any nature (whether known or unknown, liquidated or unliquidated, due or to
become due and whether absolute, accrued, contingent or otherwise) of the
Corporation of any kind whatsoever, and there is no basis for any assertion
against the Corporation of any liabilities or obligations of any kind.

 

7.1.8 Litigation

 

  (a) Except as disclosed in Schedule 7.1.8, there is no suit, action or
proceeding pending, or to the knowledge of the Vendor threatened against the
Vendor or the Corporation that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect upon the Corporation or
the Business or refrain or prevent completion of the purchase by the Purchaser
of the Purchased Shares, and there is no judgment, decree, injunction, rule or
order of any Governmental Authority with jurisdiction over the Corporation
outstanding against the Corporation or the Vendor causing, or which insofar as
can reasonably be foreseen, in the future would cause, a Material Adverse Effect
on the Corporation or the Business.

 

  (b) There is no outstanding judgment, decree, order, ruling or injunction
involving the Corporation or the Business or relating in any way to the
transactions contemplated by this Agreement.

 

7.1.9 Corporation’s Property and Assets

The Corporation holds all rights and entitlements to the undertaking, property
and assets of the Business (other than any undertaking, property or assets in
respect of which the Corporation is a lessee, in which case it has a valid
leasehold interest), and has good and marketable title to all of such
undertakings, property and assets free and clear of all Encumbrances, except for
Encumbrances against such assets in respect of security interests granted in the
Ordinary Course and the Samsung Security. The undertaking, property and assets
of the Corporation comprise all of the undertaking, assets and property
necessary to carry on the Business as it is currently operated.

 

7.1.10 Taxation

 

  (a)

The Corporation has duly and timely filed all Tax Returns required to be filed
by it and has paid all Taxes which are due and payable and has paid all
assessments and reassessments, and all other Taxes, governmental charges,
penalties, interest and fines due and payable on or before the date hereof, and
adequate provision has been made for Taxes payable for the current period for
which Tax Returns are not yet required to be filed. There are no actions, suits,
or Claims asserted or assessed against the Corporation in respect of Taxes,
governmental charges or assessments, nor are any matters under discussion with
any Governmental Authority relating to Taxes, governmental

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  charges or assessments asserted by such Governmental Authority. The
Corporation has withheld from each payment made by it to any Person and remitted
to the proper tax and other receiving offices within the time required all
income tax and other deductions required to be withheld from such payments. The
Corporation has not filed a waiver for any taxation year under any applicable
Tax Law.

 

  (b) The Corporation is a taxable Canadian corporation pursuant to the
provisions of Paragraph 89(1)(i) of the ITA.

 

  (c) The Corporation is a registrant for the purposes of the goods and services
tax provided for under the Excise Tax Act (Canada) and its GST Registration
Number is 856547419RT0001.

 

7.1.11 Compliance with Applicable Laws

The Business is being conducted in all material respects in compliance with all
Applicable Laws, regulations and ordinances of all authorities having
jurisdiction, except where the failure to comply would not be reasonably likely,
individually or in the aggregate, to have a Material Adverse Effect on the
Corporation or the Business.

 

7.1.12 Management and Employee Matters

The Corporation does not have any employees or independent contractors
consisting of individuals providing their services.

 

7.1.13 Non-Competition

Except as disclosed in Schedule 7.1.13, neither the Vendor nor the Corporation
are parties to, or bound or affected by, any contract containing any covenant
expressly limiting the Corporation’s ability to compete in any line of business,
or transfer or move any of its assets or operations or which could reasonably be
expected to have a Material Adverse Effect on the Business.

 

7.1.14 Expropriation

No property or asset of the Corporation has been taken or expropriated by any
Governmental Authority and no notice or proceeding in respect of any such
expropriation has been given or commenced nor, to the knowledge of the Vendor,
is there any intent or proposal to give any such notice or commence any such
proceeding.

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7.1.15 Permits and Qualifications

 

  (a) All Permits are listed in Schedule 7.1.15. Except as disclosed in the
Schedule and except for those Permits which are the responsibility of RES Canada
pursuant to the EPC Agreement, the Permits are the only authorizations,
registrations, permits, certificates of approval, approvals, grants, licences,
quotas, consents, commitments, rights or privileges (other than those relating
to Intellectual Property) necessary for the conduct of the Business as it is
presently conducted. To the knowledge of the Vendor, the Corporation has or the
Vendor on behalf of the Corporation has made all required registrations with any
Governmental Authority that is required to enable the Business to be carried on
as it is currently conducted and to enable the Corporation to own, lease and
operate its assets. All Permits which have been obtained prior to the date
hereof, are valid, subsisting, in full force and effect and unamended, and the
Corporation is not in default or breach of any Permit; and to the knowledge of
the Vendor, no proceeding is pending or threatened to revoke or limit any
Permit, and the completion of the transactions contemplated by this Agreement
will not result in the revocation of any Permit or the breach of any term,
provision, condition or limitation affecting the ongoing validity of any Permit.
The Corporation and/or the Vendor, as applicable, have complied with and are in
compliance with all such Permits.

 

  (b) There are no facts or circumstances known to the Vendor which would
interfere with or prevent the Corporation from obtaining any remaining Permits,
authorizations, registrations, certificates of approval, approvals, grants,
licences, quotas, consents, commitments, rights or privileges necessary for the
full operation of the Business; provided however opposition to the issuance of
the REA Permit is anticipated.

 

7.1.16 Books and Records

 

  (a) Except as set out in Schedule 7.1.16, the Books and Records and the
Financial Statements fairly and correctly set out and disclose in accordance
with GAAP, the financial position of the Corporation and all financial
transactions of the Corporation as of their respective dates and all financial
transactions of the Corporation have been accurately recorded in the Books and
Records.

 

  (b)

The corporate records and minute books of the Corporation are up-to-date and
contain complete and accurate minutes of all meetings of its directors and
shareholders and all resolutions consented to in writing

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  since the incorporation of the Corporation. All such meetings were held, all
such resolutions were passed and the share certificate books, registers of
shareholders, registers of transfers and registers of directors of the
Corporation are complete and accurate in all respects.

 

7.1.17 Indebtedness

Except to the extent reflected or reserved in the Financial Statements and:

 

  (a) disclosed in Schedule 7.1.17; or

 

  (b) incurred in the Ordinary Course of the Corporation’s Business,

the Corporation has no outstanding material indebtedness or any liabilities or
obligations (whether accrued, absolute, contingent or otherwise, including under
any guarantee of any debt) of a nature customarily reflected or reserved against
in a balance sheet in accordance with GAAP. For the purposes of this
Section 7.1.17 only, indebtedness, liabilities or obligations owing to any third
party, individually or in the aggregate, in excess of $10,000 will be deemed to
be material.

 

7.1.18 Related Party Transactions

Except as set forth in the Financial Statements and/or Schedule 7.1.18, the
Corporation has no indebtedness (including guaranties thereof) outstanding in
favour of, or owing to, the Vendor or any affiliate of the Vendor.

 

7.1.19 Business Carried on in the Ordinary Course

Except as disclosed in Schedule 7.1.19, to the knowledge of the Vendor, since
the date of the Financial Statements, the Business has been carried on in the
Ordinary Course.

 

7.1.20 Costs to Complete the Project

The anticipated interconnections costs payable to Hydro One Networks Inc. in
respect of the Project are $131,500 for transport and $716,000 for
interconnection, and the anticipated total capital costs in respect of the
Project are $22,175,551 exclusive of the transport and interconnection costs
payable to Hydro One Networks inc.

 

7.1.21 Material Contracts

 

  (a)

Schedule 7.1.21 contains a list of all Material Contracts to which the
Corporation is a party as of the date hereof and all Material Contracts to which
the Vendor is a party as of the date hereof which are in respect of the
Brooke-Alvinston Project. Each Material Contract has

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  been provided to the Purchaser, is in full force and effect, has not been
amended and is a valid and legally binding agreement of the Corporation and/or
the Vendor and the other parties thereto. Except as disclosed in the Schedule,
neither the Corporation nor the Vendor is in default or breach of any Material
Contract and to the knowledge of the Vendor, there exists no state of facts
which, after notice or lapse of time or both would constitute such a default or
breach.

 

  (b) All notices and all consents and approvals required under Material
Contracts to complete the transactions contemplated herein (“Contractual
Consents”), and all Regulatory Approvals are listed in Schedule 7.1.21(b).
Copies of all such Regulatory Approvals and Contractual Consents have been
provided to the Purchaser.

 

7.1.22 Bank Accounts and Attorneys

Schedule 7.1.22 lists the name of each bank or other depository in which the
Corporation maintains any bank account, trust account or safety deposit box and
the names of all individuals authorized to draw on them or who have access to
them.

 

7.1.23 Real Property.

 

  (a) The Corporation does not own any real property.

 

  (b) Except for the Real Property Agreements which are described in Schedule
7.1.23 and as disclosed in Schedule 7.1.23, the Corporation is not a party to
any agreement relating to any real property constituting the Project Premises or
any other real property.

 

  (c) Except as disclosed in Schedule 7.1.23:

 

  (i) the Corporation has (i) all rights of ingress and egress to and from the
Project Premises and (ii) all rights necessary to use and access the Project
Premises in order to conduct the Business;

 

  (ii) the Real Property Agreements provide all interests in land to the
Corporation which are necessary for the conduct of the Business;

 

  (iii) the Project Premises are sufficient for the conduct of the Business;

 

  (iv) the Project Premises are not situated on First Nations’ lands, do not
have to be accessed from First Nations’ lands and to the best of the knowledge
and belief of the Vendor, the Project Premises are not subject to or affected by
any Aboriginal land claims;

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  (v) the Real Property Agreements are in full force and effect and unamended
and no party is in breach under, or threatening the termination of, any Real
Property Agreement;

 

  (vi) the Real Property Agreements are on normal market terms and the optionor
and optionee thereunder are at arm’s length;

 

  (vii) the Real Property Agreements are registered on title to the subject
properties;

 

  (viii) all Taxes and other payments required to be paid by the Corporation or
the Vendor in respect of the Real Property Agreements have been duly paid to
date and the Corporation and/or the Vendor, as applicable, are not otherwise in
default in meeting their obligations under any of the Real Property Agreements.
No event exists which, with the passing of time or the giving of notice, or
both, would constitute a default by the Vendor or the Corporation, or, to the
knowledge of the Vendor, any third party, to any Real Property Agreement and no
party to any Real Property Agreement is claiming any such default or taking any
action purportedly based upon any such default;

 

  (ix) all consents to a change in control of the Corporation required under any
of the Real Property Agreements as a consequence of the transactions
contemplated by this Agreement have been obtained;

 

  (x) neither the Corporation nor the Vendor has waived, or omitted to take any
action in respect of, any of their respective rights under the Real Property
Agreements;

 

  (xi) neither the Vendor nor the Corporation has received any notification of,
nor, to the knowledge of the Vendor, does there exist any outstanding deficiency
notice or work order, or any pending deficiency notice or work order in respect
of any of the Project Premises; and

 

  (xii) neither the Vendor nor the Corporation has received any notification,
and the Vendor has no knowledge of, any application by any Person for any
rezoning, or any proposed or pending change to the zoning, of any part of the
Project Premises or affecting the Project Premises.

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  (d) Except as described in Schedule 7.1.23, and to the knowledge of the
Vendor, there are no building or use restrictions affecting the right and
interest of the Corporation in and to any of the Project Premises which, in the
aggregate, would affect the ability to carry on the Business upon the Project
Premises.

 

  (e) Except as disclosed in Schedule 7.1.23, all accounts for work and services
performed and materials placed or furnished upon or in respect of the Project
Premises at the request of the Corporation or the Vendor have been fully paid
and satisfied and no one is entitled to claim a lien under the Construction Lien
Act (Ontario) against any part of the Project Premises.

 

  (f) Except as disclosed in Schedule 7.1.23, there is nothing owing in respect
of the Project Premises by the Corporation or the Vendor to any municipal
corporation, or to any other Person owning or operating a public utility or
other distributor, for the supply or use of water, gas, electrical power or
energy, steam or hot water, other than current accounts accrued in the Ordinary
Course of the Business in respect of which the payment due date has not yet
passed.

 

  (g) Except as disclosed in Schedule 7.1.23 and to the knowledge of the Vendor,
no part of the Project Premises has been taken or expropriated by any
Governmental Authority and no notice or proceeding in respect of any such
expropriation has been given or commenced.

 

7.1.24 Intellectual Property

Schedule 7.1.24 includes a list of all Intellectual Property that is used in
connection with the conduct of the Business, the jurisdictions (if any) in which
that Intellectual Property is registered (or in which application for
registration has been made) and the applicable expiry dates of all listed
registrations. All necessary legal steps have been taken by the Vendor and/or
the Corporation to preserve the Corporation’s rights to the Intellectual
Property listed in the Schedule. Schedule 7.1.24 also includes a list of all
licence agreements pursuant to which the Corporation has been granted a right to
use, or otherwise exploit Intellectual Property owned by third parties. The
Intellectual Property that is owned by the Corporation is owned free and clear
of any Encumbrances, and no Person other than the Corporation has any right to
use that Intellectual Property except as noted in the Schedule. To the knowledge
of the Vendor, the use by the Corporation of any Intellectual Property owned by
third parties is valid and the Corporation is not in default or breach of any
licence agreement relating to that Intellectual Property and

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there exists no state of facts which, after notice or lapse of time or both,
would constitute such a default or breach. To the knowledge of the Vendor, the
conduct of the Business does not infringe the Intellectual Property of any
Person.

 

7.1.25 Accounts Receivable

All accounts receivable of the Corporation reflected in the Financial
Statements, or which have come into existence since the date of the Financial
Statements, were created in the Ordinary Course of the Business from bona fide
arm’s length transactions (except for the Vendor Receivable), and, except to the
extent that they have been paid in the Ordinary Course of the Business since the
date of the Financial Statements, are valid and enforceable and payable in full,
without any right of set-off or counterclaim or any reduction for any credit or
allowance made or given, except to the extent of the allowance for doubtful
accounts reflected in the Financial Statements and, in the case of accounts
receivable which have come into existence since the date of the Financial
Statements, of a reasonable allowance for doubtful accounts, which allowances
are adequate and calculated in a manner contained in the Books and Records of
the Corporation and consistent with the Corporation’s previous accounting
practice.

 

7.1.26 Reports

The Corporation has filed with all applicable Governmental Authorities, true and
complete copies of all forms, reports, schedules, statements and other documents
required to be filed by it and such documents and any other documents at the
time filed: (i) did not contain any misrepresentation of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they are made,
not misleading, and (ii) complied with the requirements of Applicable Law. The
Corporation has not filed any confidential report with any Governmental
Authority which at the date hereof remains confidential.

 

7.1.27 Compliance with Privacy Laws

The collection, use and retention of Personal Information by the Corporation and
the disclosure or transfer of Personal Information by the Corporation to any
third parties complies with all Privacy Laws and is consistent with the
Corporation’s own privacy policies.

 

7.1.28 Environmental Matters

Except as disclosed in Schedule 7.1.28:

 

  (a)

the conduct of the Business and to the knowledge of the Vendor, the current use
and condition of the Project Premises have been and are in compliance with all
applicable Environmental Laws, and to the

--------------------------------------------------------------------------------

  knowledge of the Vendor, there are no facts which would give rise to
non-compliance of the Corporation or the Vendor with any Environmental Laws in
the conduct of the Business or in the current uses and condition of the Project
Premises;

 

  (b) the Corporation and/or the Vendor has all Permits required by all
Environmental Laws for the conduct of the Business as it has been conducted to
date and is currently in compliance with all such Permits;

 

  (c) the Corporation and any Person for whom it is responsible pursuant to all
Environmental Laws, have imported, manufactured, processed, distributed, used,
treated, stored, disposed of, transported, exported or handled Hazardous
Substances in strict compliance with all Environmental Laws;

 

  (d) to the knowledge of the Vendor, no Hazardous Substances have been disposed
of on any of the Project Premises;

 

  (e) to the knowledge of the Vendor, there has been no Release of any Hazardous
Substance in the course of the conduct of the Business from, at, on, or under
the Project Premises or from or to any adjoining properties except in compliance
with all Environmental Laws;

 

  (f) the Corporation has not received any notice of any kind of any Release or
possible Release of any Hazardous Substance from, at, on, or under any of the
Project Premises;

 

  (g) to the knowledge of the Vendor, there are no Hazardous Substances on any
adjoining properties to any of the Project Premises which may adversely affect
the Business or any of the Project Premises;

 

  (h) there has been no Remedial Order issued to the Vendor or to the
Corporation in respect of the Business, or with respect to any of the Project
Premises and to the knowledge of the Vendor, no such Remedial Orders are
threatened, and to the knowledge of the Vendor, there are no facts which could
give rise to any such Remedial Orders;

 

  (i) the Vendor and the Corporation have not received any notice of claim,
summons, order, direction or other communication relating to non-compliance with
any Environmental Laws from any Governmental Authority or other third party;

 

  (j) there is no pending or to the knowledge of the Vendor, threatened matter,
act or fact which could cause the Vendor or the Corporation, the Business or any
of the Project Premises to no longer be in compliance with any Environmental
Laws; and

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  (k) Schedule 7.1.28 lists all material reports and documents relating to
environmental matters affecting the Project Premises or the Business which are
in the possession or control of the Vendor or the Corporation. Copies of all
such reports and documents have been delivered to the Purchaser.

 

7.1.29 Personal Information

 

  (a) except as disclosed in Schedule 7.1.29, all Personal Information in the
possession of the Corporation has been collected, used and disclosed in
compliance with all applicable Privacy Laws in the Province of Ontario; and

 

  (b) except as disclosed in Schedule 7.1.29, there are no Claims pending or, to
the knowledge of the Vendor, threatened, with respect to the Corporation’s
collection, use or disclosure of Personal Information.

ARTICLE 8

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

 

  8.1 Corporate Existence of Purchaser

The Purchaser is a corporation duly incorporated and validly existing under the
laws of the Province of Ontario.

 

  8.2 Capacity to Enter Agreement

The Purchaser has all necessary corporate power, authority and capacity to enter
into and perform its obligations under this Agreement.

 

  8.3 Binding Obligation

The execution and delivery of this Agreement and the completion of the
transactions contemplated by this Agreement have been duly authorized by all
necessary corporate action on the part of the Purchaser. This Agreement has been
duly executed and delivered by the Purchaser and constitutes a valid and binding
obligation of the Purchaser, enforceable against the Purchaser in accordance
with its terms, subject to applicable bankruptcy, insolvency and other laws of
general application limiting the enforcement of creditors’ rights generally and
to the fact that equitable remedies, including specific performance, are
discretionary and may not be ordered in respect of certain defaults.

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  8.4 Absence of Conflict

None of the execution and delivery of this Agreement, the performance by the
Purchaser of its obligations under this Agreement, or the completion of the
transactions contemplated by this Agreement will directly or indirectly (with or
without notice or lapse of time or both):

 

8.4.1 result in or constitute a breach of any term or provision of, or
constitute a default under the articles or by-laws of the Purchaser or any
agreement or other commitment to which the Purchaser is a party or by which it
or any of its property or assets are bound;

 

8.4.2 result in a breach of any law, regulation, order, judgment or decree to
which the Purchaser is subject or by which it or any of its property or assets
are bound; or

 

8.4.3 result in any violation of, be in conflict with, contravene, constitute a
default under, or give any Governmental Authority or other Person the right to
challenge or to exercise any remedy or obtain any relief under any Applicable
Law or any order served upon the Purchaser or to which the Purchaser may be
subject.

 

  8.5 Solvency

The Purchaser is not an insolvent Person within the meaning of the Bankruptcy
and Insolvency Act (Canada).

 

  8.6 Regulatory Approvals

No authorization, approval, order, consent of, or filing with, any Governmental
Authority is required on the part of the Purchaser in connection with the
execution, delivery and performance of this Agreement or any other documents and
agreements to be delivered under this Agreement except for the notice of change
of control which must be filed with the OPA.

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ARTICLE 9

INDEMNIFICATION

 

  9.1 Indemnification by the Vendor

Subject to the limitations set out in this Agreement, the Vendor shall defend,
indemnify and hold harmless the Corporation, the Purchaser and their respective
directors, officers, employees, agents, representatives and affiliates against
all Losses suffered or incurred by the Purchaser or the Corporation arising as a
result of, in respect of or arising out of:

9.1.1 any breach or inaccuracy in any representation or warranty given by the
Vendor in this Agreement or under any other agreement, certificate or instrument
executed and delivered pursuant to this Agreement as it relates to any
representation or warranty made in this Agreement;

 

9.1.2 any breach or non-performance of any covenant, procurement or agreement of
the Vendor under this Agreement or under any other agreement, certificate or
instrument executed and delivered pursuant to this Agreement as it relates to a
covenant, procurement or agreement in this Agreement;

 

9.1.3 any Claim in respect of Taxation for a taxation year or period of the
Corporation ending on or before the Closing Date or any taxation year or period
of the Corporation ending after the Closing Date which includes a period prior
to the Closing Date and results from an event occurring on or prior to the
Closing Date (a “Straddle Period”). Taxation for a Straddle Period shall be
determined on the basis that the Corporation had a notional tax year or fiscal
period ending on the Closing Date.

 

  9.2 Indemnification by the Purchaser

The Purchaser will defend, indemnify and hold harmless the Vendor and its
directors, officers, employees and agents from and against all Losses arising
out of or resulting from:

 

9.2.1 any breach or inaccuracy in any representation or warranty of the
Purchaser contained in this Agreement or under any other agreement, certificate
or instrument executed and delivered pursuant to this Agreement as it relates to
any representation or warranty made in this Agreement; and

 

9.2.2 any breach or non-performance of any covenant or agreement of the
Purchaser or of any covenant or agreement of the Corporation to be performed
after the Closing contained in this Agreement or under any other agreement,
certificate or instrument executed and delivered pursuant to this Agreement as
it relates to a covenant or agreement in this Agreement.

 

  9.3 Fraud and Intentional Misconduct

Notwithstanding any other provision of this Agreement, the limitations with
respect to time contained in Subsection 9.7 shall not apply to any Indemnified
Claim made against the Vendor in respect of fraud, intentional
misrepresentations or misconduct.

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  9.4 Procedure for Submitting and Resolving Claims for Indemnification

If any Party entitled to indemnification under this Agreement (in this
Section 9, the “Indemnified Party”) receives notice of or discovers any Claim or
the commencement of any action for which one or more other Parties (in this
Section 9, the “Indemnitor”) is or may be liable under this Agreement (the
“Indemnified Claim”), the Indemnified Party will promptly notify the Indemnitor
of the Indemnified Claim in writing. Such notice shall specify whether the
Indemnified Claim arose as a result of a Claim by a Person against the
Indemnified Party (a “Third Party Claim”) or whether the Claim does not so arise
(a “Direct Claim”) and shall also specify with reasonable particularity (to the
extent that the information is available):

 

9.4.1 the factual basis of the Claim; and

 

9.4.2 the amount of the Claim, if known.

The failure to give such notice shall not relieve the Indemnitor of any
liability or obligation under this Agreement or otherwise, except to the extent,
and only to the extent, such Indemnitor is prejudiced in the defence of such
Indemnified Claim as a result of such failure and can show the monetary amount
by which it was so prejudiced.

 

  9.5 Direct Claims.

In the case of a Direct Claim, the Indemnitor shall have 45 days from receipt of
notice of the Direct Claim within which to make such investigation of the Direct
Claim as the Indemnitor considers necessary or desirable. For the purpose of
such investigation, the Indemnified Party shall make available to the Indemnitor
the information relied upon by the Indemnified Party to substantiate the Direct
Claim, together with all such other information as the Indemnitor may reasonably
request. If both Parties agree at or before the expiration of such 45 day period
(or any mutually agreed upon extension thereof) to the validity and amount of
such Direct Claim, the Indemnitor shall pay to the Indemnified Party, the amount
of such Direct Claim failing which the matter shall be determined by a court of
competent jurisdiction. Notwithstanding the foregoing, the Purchaser and the
Corporation shall be entitled to set-off any portion of an amount payable by an
Indemnitor in respect of a Direct Claim against any amounts payable to such
Indemnitor regardless of whether there is an outstanding dispute in respect of
such Direct Claim.

 

  9.6 Third Party Claims.

 

9.6.1

In the case of a Third Party Claim, the Indemnitor will be entitled to
participate in the defence of such Third Party Claim, and, if it so elects, to
assume the defence of such Third Party Claim, with counsel reasonably
satisfactory to the Indemnified Party; provided, however, that the Vendor

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  shall not be entitled to assume the defence of any Third Party Claim arising
out of any breach of (or any alleged breach of or allegation or assertion
inconsistent with) any representation, warranty or covenant in respect of Tax
matters. After written notice from the Indemnitor to the Indemnified Party of
such election to assume the defence, the Indemnitor will not be liable to the
Indemnified Party for any legal or other expenses subsequently incurred by the
Indemnified Party in connection with the defence of the Third Party Claim, other
than costs and expenses of the Indemnified Party incurred at the request of the
Indemnitor. The assumption of the defence of any such Third Party Claim will
only be permitted if the Indemnitor first acknowledges, in writing, that it is
liable for such Third Party Claim and reasonably demonstrates to the Indemnified
Party that it has the financial ability to carry-out such defence.

 

9.6.2 The Indemnitor may, at its election and following its admission that it is
liable for such Third Party Claim, settle or compromise such Third Party Claim,
but (1) no such settlement or compromise may be effected without the Indemnified
Party’s consent, which will not be unreasonably withheld, unless there is no
finding or admission of any violation of any Governmental Regulation or any
violation of the rights of any Person and no effect on any other claims that may
be made against the Indemnified Party, and (2) the Indemnified Party will have
no liability with respect to any settlement or compromise of such Claims
effected without its consent.

 

9.6.3 The Indemnified Party will not settle or compromise any Third Party Claim
without the prior consent of the Indemnitor, unless the Indemnitor has failed or
refused to assist the Indemnified Party in the defence of the Third Party Claim
or has unreasonably refused to settle or has withheld its consent to a proposed
settlement or compromise of such Third Party Claim.

 

9.6.4 The Parties will use their commercially reasonable best efforts to agree
on whether indemnifiable damages exist and, if so, the amount. Any amounts
determined to be owed will be paid within 45 days of such determination. The
Parties will cooperate with each other in all reasonable respects in the defence
of Claims under this Agreement.

 

  9.7 Survival of Representations, warranties and Indemnities

 

9.7.1

Each of the representations, warranties and indemnities set forth in this
Agreement or in any certificate, agreement or other document furnished by or on
behalf of the Parties pursuant to this Agreement, shall survive Closing and,
notwithstanding Closing or any documents delivered or investigations made by the
Parties in connection therewith, shall continue in full force and effect for the
benefit of the Party to whom such representation, warranty and indemnity was
made for a period of one year following the date of

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  Commercial Operation provided that representations and warranties set forth in
Subsections 7.1.10 and 7.1.28 shall survive until the expiration of the statute
of limitations applicable to the underlying Claim, if any (the applicable date
until which the representations, warranties and indemnities survive is referred
to in this Agreement as the “Representation Survival Date”); and
representations, warranties and indemnities pertaining to the Purchased Shares
in Subsections 7.1.3 and 7.1.4 shall survive without limit of time.

 

9.7.2 No Claim, lawsuit or other proceeding arising out of or related to the
breach of any representation or warranty contained in this Agreement may be made
by any Party unless notice of such Claim, lawsuit or other proceeding is given
to the applicable Party prior to the applicable Representation Survival Date.

 

9.7.3 Each of the covenants set forth in this Agreement will survive the Closing
in accordance with its terms.

 

9.7.4 Notwithstanding anything in this Agreement to the contrary, the rights and
remedies under this Subsection 9.7 with respect to any Claim, lawsuit or other
proceeding (including without limitation recovery of Losses in respect thereof)
for which notice has been given prior to the applicable Representation Survival
Date will survive until such Claim, lawsuit or other proceeding has been
resolved.

 

  9.8 Recourse

The Purchaser shall have the right of equitable set-off with respect to any
amounts owed to it or to the Corporation by the Vendor under any provision of
this Agreement. Accordingly, and without limiting the generality of the
foregoing, the Purchaser may, at its option, set-off any such amounts owed to it
or to the Corporation by the Vendor against amounts owed by the Purchaser to the
Vendor under this Agreement or any agreement between the Purchaser and/or the
Corporation and the Vendor.

ARTICLE 10

TERMINATION

 

  10.1 Termination

This Agreement may be terminated at any time prior to the Closing:

 

10.1.1 by mutual written consent of the Vendor and the Purchaser;

 

10.1.2 by the Vendor and the Purchaser at any time after September 30, 2011 if,
through no fault of, or breach of any material representation, warranty or
covenant by, the Vendor or the Purchaser, the Closing has not occurred as of
such date;

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10.1.3 by the Vendor or the Purchaser, if any Governmental Authority has issued
an order, or Governmental Regulation or taken other action restraining,
enjoining or otherwise prohibiting the transactions contemplated herein and such
order or other action has become final and non-appealable;

 

10.1.4 by the Purchaser, if there has been a material violation or breach by the
Vendor of any agreement, representation or warranty contained in this Agreement
which has not been waived by the Purchaser; or

 

10.1.5 by the Vendor, if there has been a material violation or breach by the
Purchaser of any agreement, representation or warranty contained in this
Agreement, which has not been waived by the Vendor.

 

  10.2 Procedure and Effect of Termination

 

10.2.1 If this Agreement and the transactions contemplated by this Agreement are
terminated pursuant to Subsection 10.1 above, written notice of such termination
will forthwith be given to the other Party and this Agreement (with the
exception of Subsections 11.3, 11.9 and 11.10 each of which will continue
notwithstanding any such termination) will terminate, and the transactions
contemplated by this Agreement will be abandoned.

 

10.2.2 If this Agreement is terminated by a Party because of a breach of this
Agreement by the other Party or because a condition for the benefit of the
terminating Party has not been satisfied because the other Party has failed to
perform any of its obligations or covenants under this Agreement, the
terminating Party’s right to pursue all legal remedies will survive such
termination unimpaired

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ARTICLE 11

GENERAL

 

  11.1 Notices

Any notice, consent, waiver, direction or other communication required or
permitted to be given under this Agreement shall be in writing and may be given
by delivering same or sending same by facsimile transmission or electronic mail
addressed to the party to which the notice is to be given at its address for
service herein. Any notice, consent, waiver, direction or other communication
aforesaid shall, if delivered, be deemed to have been given and received on the
date on which it was delivered to the address provided herein (if a Business
Day, if not, the next succeeding Business Day) and if sent by facsimile or
electronic mail transmission be deemed to have been given and received at the
time of receipt unless actually received after 4:00 p.m. at the point of
delivery in which case it shall be deemed to have been given and received on the
next Business Day.

The address for service of the parties shall be as follows:

(a) if to the Purchaser and the Corporation:

Schneider Power Inc.

49 Bathurst Street

Suite 101

Toronto, Ontario M5V 2P2

 

Attention:    Thomas Schneider, Vice-Chairman & President Email:   
T.S@schneiderpower.com Facsimile:    416-847-3729

(b) if to the Vendor:

2700 Matheson Boulevard Avenue East

Suite 300, West Tower

Mississauga, ON L4W 4V9

 

Attention:    John Cobb, President Email:    john.cobb@greenbreeze.ca Facsimile:
   1-877-679-4633

 

  11.2 Amendment and Modification.

No amendment, supplement, restatement or termination of any provision of this
Agreement is binding unless it is in writing and signed by the Vendor and the
Purchaser.

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  11.3 Confidentiality

Subject to the provisions of Subsection 11.9 and Applicable Law, each Party will
keep confidential and refrain from using all information obtained by it in
respect of the other Party in connection with the transactions contemplated by
this Agreement relating to the other Party hereto, provided however that such
obligation shall not apply to any information which was in the public domain at
the time of its disclosure to a Party or which subsequently comes into the
public domain other than as a result of a breach of such Party’s obligations
under this Subsection 11.3. This provision shall survive the closing of the
Acquisition or any termination of this Agreement.

 

  11.4 Waiver; Extension

The Party entitled to the benefit of any respective term or provision of this
Agreement may (1) extend the time for the performance of any of the obligations
or other acts of the other Party, (2) waive any inaccuracies in the
representations and warranties of the other Party contained in this Agreement or
(3) waive compliance with any obligation, covenant or agreement of the other
Party contained in this Agreement. Any agreement with regard to any such
extension or waiver will be valid only if set forth in an instrument in writing
by the Party granting such extension or waiver. A waiver or failure to enforce
any of the terms or provisions of this Agreement will not in any way affect,
limit or waive any Party’s rights at any time to enforce strict compliance
thereafter with such term and every other term and provision of this Agreement.

 

  11.5 Assignment

Neither this Agreement nor any related agreements nor any of the rights,
interests or obligations under this Agreement nor any of such related agreements
may be assigned by operation of law or otherwise by any Party without the prior
written consent of the other Party. This Agreement will be binding upon and
inure to the benefit of the Parties named in this Agreement and their
respective, heirs, executors, representatives, successors and permitted assigns
as the case may be.

 

  11.6 Severability

The provisions of this Agreement will be deemed severable, and if any provision
of this Agreement is determined to be illegal or invalid under Applicable Law,
such provision may be changed to the extent reasonably necessary to make the
provision, as so changed, legal, valid and binding. If any provision of this
Agreement is determined to be illegal or invalid in its entirety, such
illegality or invalidity will have no effect on the other provisions of this
Agreement, which will remain valid, operative and enforceable.

--------------------------------------------------------------------------------

  11.7 Governing Law

This Agreement, its construction and the determination of any rights, duties or
remedies of the Parties arising out of or relating to this Agreement shall be
governed by, enforced under and construed in all respects in accordance with the
laws of the Province of Ontario and the laws of Canada applicable therein.

 

  11.8 Choice of Forum

Any suit, action or proceeding arising out or relating to this Agreement shall
be brought in any court in Toronto, Ontario having jurisdiction over the subject
matter thereof and the Parties irrevocably and unconditionally attorn and submit
to the jurisdiction of such court. The Parties irrevocably waive and agree not
to raise any objection that they either might now or hereafter have to the
bringing of any such suit, action or proceeding in any such court, including any
objection that the place where such court is located is an inconvenient forum or
that there is any other suit, action or proceeding in any other place relating
in whole or in part to the same subject matter. Each Party agrees that any final
judgment or order being recognized and enforced in the courts of its
jurisdiction of incorporation or any other jurisdiction where it carries on
business or has assets.

 

  11.9 Public Announcements

Each Party shall cooperate with the other Party in releasing information
concerning this Agreement and the transactions contemplated herein, and shall
furnish to and discuss with the other Party drafts of all press and other
releases prior to publication. No press release or other public announcement
concerning the transactions contemplated by this Agreement will be made by any
Party without the prior consent of the other Party, such consent not to be
unreasonably withheld or delayed; provided that nothing contained herein shall
prevent any Party at any time from furnishing any information to any
Governmental Authority or to the public if so required by Applicable Laws.

 

  11.10 Expenses

Each Party will pay its own expenses in connection with the negotiation,
execution and performance of this Agreement, the transactions contemplated by
this Agreement including the fees and expenses of counsel, accountants and other
advisors.

 

  11.11 Time of Essence

Time is of the essence of this Agreement and of each of its provisions.

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  11.12 Further Assurances

Each party will, upon request but without further consideration, from time to
time promptly execute and deliver all further documents and take all further
action necessary or appropriate to give effect to and perform the provisions and
intent of this Agreement and to complete the transactions contemplated hereby.

 

  11.13 Counterparts and Facsimile Signatures

This Agreement and any amendment, supplement or restatement of this Agreement
may be executed and delivered in one or more counterparts and may be executed
and delivered by facsimile and each of which when executed and delivered shall
be deemed an original and all of which counterparts and facsimiles together
shall be deemed to constitute one and the same instrument.

SIGNATURE PAGE FOLLOWS

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IN WITNESS WHEREOF, the undersigned have caused this Share Purchase Agreement to
be executed and delivered as of the date first above written.

 

SCHNEIDER POWER INC. Per:  

/s/ Thomas Schneider

  Name: Thomas Schneider   Title: President

 

 

GREEN BREEZE ENERGY INC. Per:  

/s/ John Cobb

  Name: John Cobb   Title: President