# EDGAR Filing Document

**Accession Number:** 0001811470
**File Stem:** 0001811470-23-000002
**Filing Date:** 2023-2
**Character Count:** 23996
**Document Hash:** f4d669c76a84012b23dcaebccebd2b60
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001811470-23-000002.hdr.sgml**: 20230207

**ACCESSION NUMBER**: 0001811470-23-000002

**CONFORMED SUBMISSION TYPE**: 1-U

**PUBLIC DOCUMENT COUNT**: 1

**CONFORMED PERIOD OF REPORT**: 20230201

**ITEM INFORMATION**: Fundamental Changes

**FILED AS OF DATE**: 20230207

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Energea Portfolio 2 LLC
- **CENTRAL INDEX KEY:** 0001811470
- **STANDARD INDUSTRIAL CLASSIFICATION:** ELECTRIC, GAS & SANITARY SERVICES [4900]
- **IRS NUMBER:** 844611704
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 1-U
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 24R-00395
- **FILM NUMBER:** 23593333

**BUSINESS ADDRESS:**
- **STREET 1:** 62 CLEMENTEL DRIVE
- **CITY:** DURHAM
- **STATE:** CT
- **ZIP:** 06422
- **BUSINESS PHONE:** 8603167466

**MAIL ADDRESS:**
- **STREET 1:** 62 CLEMENTEL DRIVE
- **CITY:** DURHAM
- **STATE:** CT
- **ZIP:** 06422

***UNITED STATES***

***SECURITIES AND EXCHANGE COMMISSION***

***Washington, D.C. 20549***

***FORM 1-U***

***CURRENT REPORT PURSUANT TO REGULATION A***

***February 1, 2023***

***(Date of Report (Date of earliest event reported))***

***ENERGEA PORTFOLIO 2 LLC***

***(Exact name of registrant as specified in its charter)***

***Delaware***

***(State or other jurisdiction of incorporation or organization)***

***84-4611704***

***(I.R.S. Employer Identification No.)***

***62 Clementel Drive, Durham, CT 06422***

***(Full mailing address of principal executive offices)***

***860-316-7466***

***(Issuer's telephone number, including area code)***

***Class A Investor Shares<br> (Title of each class of securities issued pursuant to Regulation A)***

*This IC Memo includes projections and forward-looking information that represent Energea's assumptions and expectations in light of currently available information. Except for statements of historical fact, the information contained herein constitutes forward-looking statements and they are provided to allow potential investors the opportunity to understand management's beliefs and opinions in respect of the future so that they may use such beliefs and opinions as one factor in evaluating an investment. These forward-looking statements are not guarantees of future performance and necessarily involve known and unknown risks and uncertainties, which may cause actual performance and financial results in future periods to differ materially from any projections of future performance.*

 **<u>Executive Summary</u>**

*São Francisco de Itabapoana is a 3.13 MWp solar power plant to be located at Areia, Areia Areia Farm in the São Francisco de Itabapoana municipality, Rio de Janeiro State ("Project"). The Project will be connected to the Enel-RJ electricity distribution grid, as established through the Brazilian Federal Law 14.300/2022 and Normative Resolution (REN) No 1000/2021 of ANEEL (National Electrical Energy Agency).* 

*This solar plant will be rented to a consortium, made up of residential and commercial customers for a period of 25 years.* 

*The project is at Development Stage with Interconnection secured and a Land Lease fully executed with a 25-year term. This IC Memo refers to the approval of investment of 500,000 BRL ($96,724) for the development of the Project.*

*The estimated total cost of the project is 19.584.566 BRL (3.756.699 USD) with a projected IRR of 17.74% ($USD).*

 **<u>Key Information</u>**

 ***General Info***

---

| | |
|:---|:---|
| *Project Owner* | *Energea Portfolio 2 LLC.* |
| *Project Location* | *São Francisco de Itabapoana/RJ, Brazil* |
| *Technology* | *Ground-Mounted Solar* |
| *System Size (AC/DC)* | *2.50 MW/ 3.13 MWp* |
| *Estimated Year 1 Production* | *6,325 MWh* |
| *Coordinates* | *21.499576° S 41.08733° W* |
| *Land Status* | *Rented* |
| *Project Status* | *Notice to Proceed* |
| *Useful Equipment Life (Years)* | *25* |

---

 ***Stakeholders***

---

| | |
|:---|:---|
| *SPE* | *Energea Itabapoana Ltda.* |
| *Offtaker* | *Consorcio II de Geracao Compartilhada de Energia Elétrica Energea* |
| *EPC Contractor* | *T.B.D.* |
| *O&M Contractor* | *T.B.D.* |
| *Land Owner* | *Rafael da Silva Imobiliária - ME* |

---

 ***Uses of Capital and Project Economics***

---

| | |
|:---|:---|
| &nbsp;&nbsp; *Project Hard Costs* | &nbsp;&nbsp; *17.887.500 BRL* |
| &nbsp;&nbsp; *Project Soft Costs* | &nbsp;&nbsp; *1.033.025 BRL* |
| &nbsp;&nbsp; *Developer Fee*  | &nbsp;&nbsp; *500.000 BRL* |
| &nbsp;&nbsp; *Total Project Financing* | &nbsp;&nbsp; *19.584.566 BRL* |
| &nbsp;&nbsp; *Debt Funding*  | &nbsp;&nbsp; *N/A* |
| &nbsp;&nbsp; *Equity Funding* | &nbsp;&nbsp; *19.584.566 BRL* |
| &nbsp;&nbsp; *Project IRR (USD)* | &nbsp;&nbsp; *17,74%*  |

---

 **<u>Project Review</u>**

***SPE***

*The Project's Special Purpose Entity (SPE) was fully formed on March 09, 2022, Energea Portfolio 2 LLC. being the sole member of the company. The SPE General Information is described on Table 1.*

*Table 1 - SPE General Information*

---

| | |
|:---|:---|
| &nbsp;&nbsp; *SPE* | &nbsp;&nbsp; *Energea Itabapoana Ltda.* |
| &nbsp;&nbsp; *Registered Office* | &nbsp;&nbsp; *280 Barão de Jaguaripe Street, room 501, Ipanema, Rio de Janeiro - RJ, Zip Code: 22.421-000* |
| &nbsp;&nbsp; *CNPJ* | &nbsp;&nbsp; *45.575.582/0001-72* |

---

***Site***

*Rafael da Silva Imobiliária - ME ("Land Owner") owns the site for the project. The SPE entered into a Site Lease Agreement with the Land Owner to secure approximately 6,0 hectares of the site on March 17th, 2022. The agreed monthly lease payment is 7,200 BRL from the beginning of operation and going forward. The values are adjusted on each contract year in accordance with the IPCA.* 

***Design***

*The Project final design has not been defined yet. Nevertheless, it is expected to employ Energea's standard solution with bifacial solar modules manufactured by Longi, a Tier 1 solar manufacturer based in China and SMA String inverters.* 

*According to the initial Energy Production Assessment, the Project is estimated to produce around 6,325 MWh/year with an AC Capacity Factor of 28.9%.*

***Interconnection***

*The Interconnection for the project is secured through the Parecer de Acesso issued in November 07<sup>th</sup>, 2022 by Ampla Energia e Servicos S.A. ("Enel-RJ" or "Utility Company") to the Offtaker.* 

*On a distribution grid level, system modifications priced at 422,913 BRL by ENEL-RJ will be necessary for the project's interconnection. The grid works scope involves the cable replacement of 0.5 km and 1.2 km extension of 1.2 km of a new distribution line. The works will be performed by Light with a 12-month schedule.*

***Offtaker***

*The Offtaker will be Consorcio II de Geracao Compartilhada de Energia Elétrica Energea. The SPE and the Offtaker will sign an Equipment Rental Agreement, which determines a monthly fixed price to be paid to the SPE. Both parties will also execute an O&M Agreement, that stipulates a variable remuneration to the SPE.*

*The consortium will be made up of residential and commercial customers known as "subscribers". They may opt into and out of the program without penalty. In the case any subscriber does not make a payment, the Offtaker may replace them with another subscriber from the waiting list.* 

*Table 2 - PPA Main Terms*

---

| | |
|:---|:---|
| *Revenue Contract Term* | *25 years* |
| *Equipment Rental Price* | *330,000 BRL/mth* |
| *O&M Price* | *Variable* |
| *Resulting Energy Credit* | *794,23 BRL/MWh* |

---

***EPC***

*The EPC contractor has not been selected yet. The SPE will do an RFP to price and scope the necessary works and, consequently, to select the EPC partner for the project.* 

***O&M***

*The final O&M service provider has not been selected yet. The Contractor will be chosen and contracted in duly time, prior to the Project's COD.*

**<u>*Financial Analysis*</u>**

***The resulting nominal IRR, in US Dollars, of each individual Micro is projected to be 17.74%****, with an estimated payback of 6 years, 8 months, and 19 days from the NTP date. The income statement, cash flow statement and balance sheet up until 2030 (shown annually) are presented on Exhibit I in the website IC Memo.*

*The project's nominal IRR was stress tested on scenarios with a range of variations applied to the discounted price. The resulted average was an impact of negative 24.1 basis points per percentage point increased. Another test was conducted on the effects of the devaluation of the Brazilian Real currency towards the U.S. dollar, with it resulting in a negative 105.0 basis points per percentage point devalued.* 

*Two macroeconomic assumptions are assumed within the financial model to better reflect the reality of Brazil's regional condition. For currency inflation, it was assumed a 4.00% year-to-year price readjustments for all years, apart from year 2022, which was defined at a 10.00% rate. On Foreign Exchange ("FX"), this model assumes a base rate of 5.18 $BRL / $USD in the month of June, resulted from the last 12-month average, being devalued month-to-month at a yearly 2.00% compounded rate.* 

***Revenue***

*The source of the project's revenue is split in between two 25-year term contracts with Consórcio RJ de Geração Compartilhada de Energia Elétrica Energea, an Equipment Rental Contract, with a fixed monthly price, with its value defined in Table 4, and an O&M Contract, containing a true-up mechanism with the goal of adjusting the overall revenue to match a target price per energy compensated.*

*In the case of São Francisco de Itabapoana, the true-up formula first calculates the utility's energy credit value, after discounting the non-compensable taxes from the grossed up low voltage rates, and applies a fixed discount on it to extract the total on which to charge the consortium members. This method allows for a higher realized revenue in the project, as the basis for the application of the discount (the credit value) is lower than the utility tariff. It is, then, deducted from the collected billed amount, after a 3.00% projected default rate is applied, the demand charge (TUSD up until the expected revision date of May 25<sup>th</sup>, 2023, and TUSDg thereafter, as a direct scenario where PL 5829/2019 passes is being accounted for), and the fixed monthly price of the Rental Contract. The result, if positive, gets collected by the SPE and, if negative, discounts the fixed monthly value of the Equipment Rental.*

*This analysis used a 30-day billing cycle to realize each month's revenue.*

*Inflation readjustments of both contracts are timed, in the model, with the utility's price refresh. Historically, ENEL RJ's rates tend to readjust once per year, in the month of March. Currently, the model uses as a basis for adjustment, the Brazilian Central Bank's 2020's target inflation rate of 4.00%, defined in the IPCA index. However, energy inflation in Rio de Janeiro has been, historically, above IPCA, with ENEL RJ's last three years readjustments at 17.30% (2021 to 2022), 4.50% (2020 to 2021), 2.31% (2019 to 2020) and -2.03% (2018 to 2019) and, cumulatively for the last 5 years, 34.60% versus IPCA's 27.68%.*

*Table 3 - Revenue Assumptions*

---

| | |
|:---|:---|
| &nbsp;&nbsp; *Revenue Contract Term* | &nbsp;&nbsp; *25 years* |
| &nbsp;&nbsp; *Fixed Discount on Credit Value* | &nbsp;&nbsp; *13.00%* |
| &nbsp;&nbsp; *Rental Revenue Price* | &nbsp;&nbsp; *330,000 BRL / month* |
| &nbsp;&nbsp; *O&M Revenue Price* | &nbsp;&nbsp; *Variable* |
| &nbsp;&nbsp; *Resulting Energy Credit Rate* | &nbsp;&nbsp; *794,23 BRL / MWh* |
| &nbsp;&nbsp; *Energea's Rate (Taxes Discounted)* | &nbsp;&nbsp; *794,23 BRL / MWh* |
| &nbsp;&nbsp; *Demand Charge (TUSD rate)*  | &nbsp;&nbsp; *38,85 BRL / kWac* |
| &nbsp;&nbsp; *Demand Charge (TUSDg rate)* | &nbsp;&nbsp; *10,72 BRL / kWac* |
| &nbsp;&nbsp; *Default Rate* | &nbsp;&nbsp; *3.00%* |

---

***Operating Expenses***

*The model assumes the operating expenses as they are valued on Table 5.*

*All prices used on Table 5 are readjusted by IPCA, currently assumed at a 4.00% rate, once per year.*

*Table 4 - Operating Expenses Assumptions*

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; *Operations & Maintenance* | &nbsp;&nbsp; *20,000 BRL / month* | &nbsp;&nbsp; *Paid by SPE* |
| &nbsp;&nbsp; *Security* | &nbsp;&nbsp; *2,500 BRL / month* | &nbsp;&nbsp; *Paid by SPE* |
| &nbsp;&nbsp; *Land of Roof Rental* | &nbsp;&nbsp; *1,200 BRL / month* | &nbsp;&nbsp; *Paid by SPE* |
| &nbsp;&nbsp; *Insurance (GL & Property)* | &nbsp;&nbsp; *57.282 BRL / year* | &nbsp;&nbsp; *Paid by SPE* |
| &nbsp;&nbsp; *Banking & FX Fees* | &nbsp;&nbsp; *200.00 BRL / month* | &nbsp;&nbsp; *Paid by SPE* |
| &nbsp;&nbsp; *Utilities* | &nbsp;&nbsp; *1,000 BRL / month* | &nbsp;&nbsp; *Paid by SPE* |
| &nbsp;&nbsp; *Postage and Courier Services* | &nbsp;&nbsp; *100 BRL / month* | &nbsp;&nbsp; *Paid by SPE* |
| &nbsp;&nbsp; *Travel* | &nbsp;&nbsp; *1,000 BRL / month* | &nbsp;&nbsp; *Paid by SPE* |
| &nbsp;&nbsp; *Entity Expenses* | &nbsp;&nbsp; *1,000 BRL / month* | &nbsp;&nbsp; *Paid by SPE* |
| &nbsp;&nbsp; *Marketing Commission* | &nbsp;&nbsp; *5.00% of Revenue* | &nbsp;&nbsp; *Paid by Consortium* |
| &nbsp;&nbsp; ***Average OPEX per Month*** | &nbsp;&nbsp; ***60,445 BRL/ month*** | &nbsp;&nbsp; *-* |

---

 *\*On the energy compensated* 

 *\*\*All values readjusted with IPCA annually.*

***CAPEX***

*For this analysis, it was considered, in the model, the latest EPC market prices.*

*As the project currently finds itself in a development stage, the standard assumption of 3% contingency on the EPC total is assumed as part of the total Soft Costs, alongside other expected budgeted items.*

*Lastly, no interconnection cost is assumed by the project.*

*Table 5 - Capital Expenditures Assumptions*

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp; **<u>*Brazilian Reais (BRL)*</u>** | &nbsp;&nbsp; **<u>*Brazilian Reais (BRL)*</u>** | &nbsp;&nbsp; **<u>*US Dollars (USD)*</u>** | &nbsp;&nbsp; **<u>*US Dollars (USD)*</u>** |
| &nbsp;&nbsp; ***Acquisition Costs*** | &nbsp;&nbsp; ***500,000 BRL*** | &nbsp;&nbsp; ***0.15 BRL/Wdc*** | &nbsp;&nbsp; ***96,724 USD*** | &nbsp;&nbsp; ***0.03 USD/Wdc*** |
| &nbsp;&nbsp; ***Hard Costs*** | &nbsp;&nbsp; ***17,887,500 BRL*** | &nbsp;&nbsp; ***5.30 BRL/Wdc*** | &nbsp;&nbsp; ***3,430,524 USD*** | &nbsp;&nbsp; ***1.02 USD/Wdc*** |
| &nbsp;&nbsp; *Solar Modules* | &nbsp;&nbsp; *7,038,896 BRL* | &nbsp;&nbsp; *2.09 BRL/Wdc* | &nbsp;&nbsp; *1,354,038 USD* | &nbsp;&nbsp; *0.40 USD/Wdc* |
| &nbsp;&nbsp; *Solar Inverters* | &nbsp;&nbsp; *934,638 BRL* | &nbsp;&nbsp; *0.28 BRL/Wdc* | &nbsp;&nbsp; *179,792 USD* | &nbsp;&nbsp; *0.05 USD/Wdc* |
| &nbsp;&nbsp; *Mounting Materials* | &nbsp;&nbsp; *2,906,053 BRL* | &nbsp;&nbsp; *0.86 BRL/Wdc* | &nbsp;&nbsp; *559,023 USD* | &nbsp;&nbsp; *0.17 USD/Wdc* |
| &nbsp;&nbsp; *Electrical Materials* | &nbsp;&nbsp; *1,897,917 BRL* | &nbsp;&nbsp; *0.56 BRL/Wdc* | &nbsp;&nbsp; *362,839 USD* | &nbsp;&nbsp; *0.11 USD/Wdc* |
| &nbsp;&nbsp; *Civil Materials* | &nbsp;&nbsp; *457,610 BRL* | &nbsp;&nbsp; *0.14 BRL/Wdc* | &nbsp;&nbsp; *87,717 USD* | &nbsp;&nbsp; *0.03 USD/Wdc* |
| &nbsp;&nbsp; *Engineering Drawings* | &nbsp;&nbsp; *369,880 BRL* | &nbsp;&nbsp; *0.11 BRL/Wdc* | &nbsp;&nbsp; *71,152 USD* | &nbsp;&nbsp; *0.02 USD/Wdc* |
| &nbsp;&nbsp; *Site Works* | &nbsp;&nbsp; *802,847 BRL* | &nbsp;&nbsp; *0.24 BRL/Wdc* | &nbsp;&nbsp; *153,551 USD* | &nbsp;&nbsp; *0.05 USD/Wdc* |
| &nbsp;&nbsp; *Electrical Work* | &nbsp;&nbsp; *1,730,337 BRL* | &nbsp;&nbsp; *0.51 BRL/Wdc* | &nbsp;&nbsp; *329,800 USD* | &nbsp;&nbsp; *0.10 USD/Wdc* |
| &nbsp;&nbsp; *Mechanical Work* | &nbsp;&nbsp; *187,950 BRL* | &nbsp;&nbsp; *0.06 BRL/Wdc* | &nbsp;&nbsp; *35,819 USD* | &nbsp;&nbsp; *0.01 USD/Wdc* |
| &nbsp;&nbsp; *Others* | &nbsp;&nbsp; *1,561,372 BRL* | &nbsp;&nbsp; *0.46 BRL/Wdc* | &nbsp;&nbsp; *296,795 USD* | &nbsp;&nbsp; *0.09 USD/Wdc* |
| &nbsp;&nbsp; ***Soft Costs*** | &nbsp;&nbsp; ***1,033,025 BRL*** | &nbsp;&nbsp; ***0.31 BRL/Wdc*** | &nbsp;&nbsp; ***198,182 USD*** | &nbsp;&nbsp; ***0.06 USD/Wdc*** |
| &nbsp;&nbsp; *Contingency* | &nbsp;&nbsp; *536,625 BRL* | &nbsp;&nbsp; *0.16 BRL/Wdc* | &nbsp;&nbsp; *103,306 USD* | &nbsp;&nbsp; *0.03 USD/Wdc* |
| &nbsp;&nbsp; *Entity Costs* | &nbsp;&nbsp; *10,000 BRL* | &nbsp;&nbsp; *0.00 BRL/Wdc* | &nbsp;&nbsp; *1,925 USD* | &nbsp;&nbsp; *0.00 USD/Wdc* |
| &nbsp;&nbsp; *Independent Engineer* | &nbsp;&nbsp; *90,000 BRL* | &nbsp;&nbsp; *0.03 BRL/Wdc* | &nbsp;&nbsp; *17,212 USD* | &nbsp;&nbsp; *0.01 USD/Wdc* |
| &nbsp;&nbsp; *Insurance* | &nbsp;&nbsp; *100,000 BRL* | &nbsp;&nbsp; *0.03 BRL/Wdc* | &nbsp;&nbsp; *19,521 USD* | &nbsp;&nbsp; *0.01 USD/Wdc* |
| &nbsp;&nbsp; *Land Rental* | &nbsp;&nbsp; *26,400 BRL* | &nbsp;&nbsp; *0.01 BRL/Wdc* | &nbsp;&nbsp; *5,049 USD* | &nbsp;&nbsp; *0.00 USD/Wdc* |
| &nbsp;&nbsp; *Legal Fees* | &nbsp;&nbsp; *50,000 BRL* | &nbsp;&nbsp; *0.01 BRL/Wdc* | &nbsp;&nbsp; *9,626 USD* | &nbsp;&nbsp; *0.00 USD/Wdc* |
| &nbsp;&nbsp; *Marketing Channels* | &nbsp;&nbsp; *50,000 BRL* | &nbsp;&nbsp; *0.01 BRL/Wdc* | &nbsp;&nbsp; *9,515 USD* | &nbsp;&nbsp; *0.00 USD/Wdc* |
| &nbsp;&nbsp; *Spare Parts* | &nbsp;&nbsp; *170,000 BRL* | &nbsp;&nbsp; *0.05 BRL/Wdc* | &nbsp;&nbsp; *32,298 USD* | &nbsp;&nbsp; *0.01 USD/Wdc* |
| &nbsp;&nbsp; ***Pre-COD OpEx*** | &nbsp;&nbsp; ***164,041 BRL*** | &nbsp;&nbsp; ***0.05 BRL/Wdc*** | &nbsp;&nbsp; ***31,269 USD*** | &nbsp;&nbsp; ***0.01 USD/Wdc*** |
| &nbsp;&nbsp; ***Total CapEx (All-In)*** | &nbsp;&nbsp; ***19,584,566 BRL*** | &nbsp;&nbsp; ***5.80 BRL/Wdc*** | &nbsp;&nbsp; ***3,756,699 USD*** | &nbsp;&nbsp; ***1.11 USD/Wdc*** |

---

***Taxes***

*São Francisco de Itabapoana stands with an effective tax rate of 14.21%, compared with its gross revenues, with PIS / COFINS representing 3.65%, ISS at 0.08%, IRPJ at 7.60% and CSLL at 2.88%.*

*As the project contains an average Profit margin of 50.18% (after depreciation), it is benefited by the Presumed Profit tax basis as it locks the taxable income at 32% of gross revenue. The downside of adopting a Presumed Profit basis is the loss of 196,214 BRL in Net Operating Losses ("NOLs") and 1,654,594 BRL in PIS / COFINS tax credits. After running both scenarios, the model assumes that a Presumed Profit tax basis is more beneficial to be used in the SPE.*

*IOF tax is assumed, given that all contributions, distributions and intercompany transactions are done internationally, in between the SPE and an American holding company.*

*Indirect taxes are not charged to the SPE but are both paid indirectly through demand charge (as it's grossed up by both PIS / COFINS and ICMS) and deducted from the energy credit's value. Rio de Janeiro currently contains medium rates for indirect taxes, for Shared Generation projects, if compared with other States, representing, for the São Francisco de Itabapoana, a total of 18.68% of the gross revenue and an annual average of 1,154,569.31 BRL.*

*Table 6 - Tax Assumptions*

---

| | |
|:---|:---|
| &nbsp;&nbsp; ***Direct Taxes*** | &nbsp;&nbsp; ***Direct Taxes*** |
| &nbsp;&nbsp; *PIS / COFINS on Revenue* | &nbsp;&nbsp; *3.65% of Gross Revenue* |
| &nbsp;&nbsp; *ISS on Revenue* | &nbsp;&nbsp; *5.00% of O&M Revenue* |
| &nbsp;&nbsp; *Tax Basis* | &nbsp;&nbsp; *Presumed Profit* |
| &nbsp;&nbsp; *Taxable Income Basis* | &nbsp;&nbsp; *32.00% of Gross Revenue* |
| &nbsp;&nbsp; *IRPJ on Profit* | &nbsp;&nbsp; *15.00% of Taxable Income* |
| &nbsp;&nbsp; *Additional IRPJ on Profit (If monthly taxable income is greater than 20,000)* | &nbsp;&nbsp; *10.00% of Taxable Income* |
| &nbsp;&nbsp; *CSLL on Profit* | &nbsp;&nbsp; *9.00% of Taxable Income* |
| &nbsp;&nbsp; *IOF on Financial Transactions* | &nbsp;&nbsp; *0.38% of Financial Transactions* |
| &nbsp;&nbsp; ***Indirect Taxes*** | &nbsp;&nbsp; ***Indirect Taxes*** |
| &nbsp;&nbsp; *PIS / COFINS on Demand Charge* | &nbsp;&nbsp; *5.50%* |
| &nbsp;&nbsp; *ICMS on Demand Charge* | &nbsp;&nbsp; *18.00%* |
| &nbsp;&nbsp; *Non-Compensable PIS / COFINS* | &nbsp;&nbsp; *57.67 BRL / MWh* |

---

**<u>*Legal Review*</u>**

***Relevant Documents***

*A Legal review was performed in the project's available documentation. The most relevant documents are listed below:*

*1. Social Contract of Energea Itabapoana Ltda.;*

*2. Property Lease Agreement.*

***Issues List***

*Table 7 - Issues List*

*EPC Agreement* *There's no EPC Agreement.* <br> *Revenue Agreements* <u> *The Revenue Agreements (Equipment Rental Agreement and O&M) are not signed.* </u>

***Contract Summary***

*Table 8 - SPE Social Contract Summary*

---

| | |
|:---|:---|
| &nbsp;&nbsp; *Contract* | &nbsp;&nbsp; *Social Contract of Energea Itabapoana Ltda.* |
| &nbsp;&nbsp; *Incorporation Date* | &nbsp;&nbsp; *March 9th, 2022*  |
| &nbsp;&nbsp; *Structure* | &nbsp;&nbsp; *Limited Liability Company (Brazilian Limitada)* |
| &nbsp;&nbsp; *Quotaholder* | &nbsp;&nbsp; *Energea Portfolio Holding Ltda. (100%)* |
| &nbsp;&nbsp; *Management* | &nbsp;&nbsp; *Christopher Joseph Sattler*<br> *Frederico Gomes*<br> *Antonio Pires* |

---

*Table 9 - Property Lease Agreement Summary*

---

| | |
|:---|:---|
| &nbsp;&nbsp; *Contract* | &nbsp;&nbsp; *Property Lease Agreement*  |
| &nbsp;&nbsp; *Date* | &nbsp;&nbsp; *March 17<sup>th</sup>, 2022* |
| &nbsp;&nbsp; *Parties* | &nbsp;&nbsp; *Energea Itabapoana Ltda. - Lessee*<br> *Rafael da Silva Imobiliária - ME - Lessor* |
| &nbsp;&nbsp; *Term* | &nbsp;&nbsp; *25 years from the start of operation date* |
| &nbsp;&nbsp; *Object* | &nbsp;&nbsp; *Lease of a rural property in São Francisco de Itabapoana, State of Rio de Janeiro, with a total leased area of 6 hectares* |
| &nbsp;&nbsp; *Basic Rent* | &nbsp;&nbsp; *R$400.00/ha from the start of implementation period until the start of operation date;*<br> *R$1,200.00/ha from the start of operation date* |
| &nbsp;&nbsp; *Rent Payment* | &nbsp;&nbsp; *Monthly* |
| &nbsp;&nbsp; *Surface Rights* | &nbsp;&nbsp; *Lessors have the obligation to provide the surface rights deed when requested by Lessee.* |

---

*Documentation Checklist*

*Table 10 - Documentation Checklist*

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp; *SPE* | &nbsp;&nbsp; *Social Contract* | &nbsp;&nbsp; *X* |
| &nbsp;&nbsp; *SPE* | &nbsp;&nbsp; *National Registration* | &nbsp;&nbsp; *X* |
| &nbsp;&nbsp; *SPE* | &nbsp;&nbsp; *Municipal Registration* |  |
| &nbsp;&nbsp; *Site* | &nbsp;&nbsp; *Site Photos* | &nbsp;&nbsp; *X* |
| &nbsp;&nbsp; *Site* | &nbsp;&nbsp; *Land Owner Documents* | &nbsp;&nbsp; *X* |
| &nbsp;&nbsp; *Site* | &nbsp;&nbsp; *Property Lease Agreement* | &nbsp;&nbsp; *X* |
| &nbsp;&nbsp; *Design and Application* | &nbsp;&nbsp; *Energy Resource Study* |  |
| &nbsp;&nbsp; *Design and Application* | &nbsp;&nbsp; *Preliminary Engineering* |  |
| &nbsp;&nbsp; *Interconnection* | &nbsp;&nbsp; *Parecer de Acesso* | &nbsp;&nbsp; *X* |
| &nbsp;&nbsp; *Interconnection* | &nbsp;&nbsp; *Interconnection Contracts* |  |
| &nbsp;&nbsp; *Permit* | &nbsp;&nbsp; *Environmental License* | &nbsp;&nbsp; *X* |
| &nbsp;&nbsp; *Offtaker* | &nbsp;&nbsp; *Offtaker Credit Analysis* |  |
| &nbsp;&nbsp; *Offtaker* | &nbsp;&nbsp; *Revenue Agreement Set* |  |
| &nbsp;&nbsp; *EPC* | &nbsp;&nbsp; *Selection of EPC* |  |
| &nbsp;&nbsp; *EPC* | &nbsp;&nbsp; *EPC Contract scoped and priced* |  |
| &nbsp;&nbsp; *O&M* | &nbsp;&nbsp; *O&M Agreement* |  |
| &nbsp;&nbsp; *Investment* | &nbsp;&nbsp; *Project Model* | &nbsp;&nbsp; *X* |

---

*The Investment Committee members have reviewed the Project Memorandum and hereby approve the investment on the São Francisco de Itabapoana Project.*

**<u>*Signatures*</u>**

*Pursuant to the requirements of Regulation A, the issuer has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.*

*Energea Global LLC*

*By <u>MICHAEL SILVESTRINI</u>*

*Name: Mike Silvestrini* 

*Title: Managing Partner*

*Date <u>February 1, 2023</u>*