Document:

ex10-36.htm

Exhibit 10.36

 

PRINCIPAL SOLAR 

PROMISSORY NOTE

 

 

	
$300,000.00 
	 	
Date: February 25, 2016 

	
 
	 	
Dallas, Texas 

 

FOR VALUE RECEIVED, Principal Solar, Inc., of Dallas, Texas ("Borrower" or "Company"), hereby promises to pay to The Pearl M Thompson Trust dated March 24, 2004 an irrevocable trust for of Matthew A. Thompson, an individual residing at _______ ("Lender"), in lawful money of the United States of America and in immediately available funds, the principal sum of Three Hundred Thousand Dollars ($300,000.00) (the "Loan"), payable on the dates and in the manner set forth below.

 

	 	
1.
	
Repayment. The outstanding principal amount of the Loan shall be payable in full on June 24, 2016 ("Maturity Date"), subject to the terms and limitations hereunder. The Borrower may prepay this Note in whole or in part at any time prior to the Maturity Date without the written consent of Lender, at Borrower's sole discretion (a "Prepayment").

 

	 	
2.
	
Fee. As consideration for making this loan, Lender shall receive a one-time funding fee in an amount calculated as 15% of the amount advanced.

 

	 	
3.
	
Interest Rate. This Promissory Note is non-interest bearing, except for any amounts outstanding beyond the Maturity Date shall earn interest at a rate of 12% per annum.

 

	 	
4.
	
Place of Payment. All principal payable hereunder shall be payable to Lender at the address it specifies to Borrower in writing.

 

	 	
5.
	
Application of Payments. Any payments on this Note shall be applied to the outstanding principal balance hereof.

 

	 	
6.
	
Use of Proceeds. The proceeds from this Note shall be used by Borrower to make a pay amounts due to Duke Energy Progress, Inc. for interconnections and other expenses associated with Borrowers development of Innovative Solar 42, LLC.

 

	 	
7.
	
Governing Law. This Note shall be governed by, construed and enforced in accordance with, the laws of the State of Texas, excluding conflict of laws principles that would cause the application of laws of any other jurisdiction. Any action brought to enforce or interpret this Note shall be brought in the courts located in Dallas County, Texas.

  

 

 

 

 

Exhibit 10.36

 

	 	
8.
	
Transfers, Successors and Assigns. The provisions of this Note shall inure to the benefit of and be binding on any successor to Borrower and shall extend to any holder hereof; provided, however, that the Lender may not, without the prior written consent of Borrower (such consent not to be unreasonably withheld and such consent not to be required if an Event of Default exists), assign, transfer or negotiate this Note to any Person. Any such transfer or assignment must be in full compliance with applicable securities laws.

 

 

 

IN WITNESS WHEREOF, the Borrower and the Lender have duly executed this Promissory Note as of the date first written above.

 

 

 

	
BORROWER: 
	
 
	
 
	
LENDER: 
	
 

	Michael Gorton, 	 	 	Matthew A. Thompson, Trustee for	 
	CEO Principal Solar, Inc.	 	 	The Pearl M. Thompson Trust	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	
/s/ Michael Gorton
	
 
	
 
	
/s/ Matthew Thompsonex10-37.htm

Exhibit 10.37

  

 

PRINCIPAL SOLAR, INC.

 

PROMISSORY NOTE

 

	
$200,000.00 
	
 
	
Date: April 1, 2016 

	
 
	
 
	
 Dallas, Texas

 

FOR VALUE RECEIVED, Principal Solar, Inc., of Dallas, Texas ("Borrower" or "Company"), hereby promises to pay to the G. Marmol and G. Marmol Revocable Trust dated_____________ for the benefit of Guillermo G. Marmol and Gail A. Marmol, individuals residing at ______________ ("Lender"), in lawful money of the United States of America and in immediately available funds, the principal sum of Two Hundred Thousand Dollars ($200,000.00) (the "Loan"), payable on the dates and in the manner set forth below.

 

1.  Repayment. The outstanding principal amount, fee, and interest, if any, of the Loan shall be payable in full at the earlier of (i) financial close of the assignment of Innovative Solar 42, LLC, (ii) the receipt of the "IS 46 COD Payment" (as defined in Exhibit A hereto) resulting from the August 2015 assignment of Innovative Solar 46, LLC, or (ii) July 29, 2016 ("Maturity Date"), subject to the terms and limitations hereunder. The Borrower may prepay this Note in whole or in part at any time prior to the Maturity Date without the written consent of Lender, at Borrower's sole discretion (a "Prepayment"). For purposes of clarity, Lender and Borrower acknowledge that the repayment of the Loan is not conditioned upon the financial close of the assignment of Innovative Solar 42, LLC, nor is the source of funds for the repayment of the Loan limited to such financial close. Failure to pay on or before the Maturity Date shall constitute a default. For purposes of clarification, to the extent any part of the principal amount, fee and interest, if any, of the Loan is outstanding at the time Borrower receives the IS 46 COD Payment, the proceeds of such IS 46 COD Payment shall be used to repay the principal amount, fee and interest, if any, of the Loan.

 

2.  Fee. As consideration for making this Loan, Lender shall receive a one-time funding fee in an amount calculated as 15% of the amount advanced, which fee shall be paid no later the Maturity Date.

 

3.  Interest Rate. This Promissory Note is non-interest bearing, except for any amounts outstanding beyond the Maturity Date shall earn interest at a rate of 10% per annum, compounded daily.

 

4.  Priority. Payment of this Note shall be (i) subordinate to amounts due under that certain Release, Accord And Satisfaction Agreement dated February 8, 2016, between Principal Solar, Inc. and Vis Solis, Inc. et al (ii) to the extent all or any part of the principal amount, fee and interest, if any, of the Loan is outstanding at the time of the maturity date of that certain Promissory Note dated February 25, 2016, between Principal Solar, Inc. and The Pearl M Thompson Trust dated March 24, 2004 (the “PMT Trust Note”), pari pasu to such PMT Trust Note and (iii) senior to all other unsecured debts of Borrower (past, current and future). 

 

5.  Place of Payment. All principal payable hereunder shall be payable to Lender at the address it specifies to Borrower in writing.

 

6.  Application of Payments. Any payments on this Note shall be applied first to fees, second to interest due, if any, and lastly to the outstanding principal balance hereof.

  

 

 

 

 

7.  Use of Proceeds. The proceeds from this Note shall be used by Borrower to pay amounts due to Duke Energy Progress, Inc. for interconnections and other expenses associated with Borrowers development of Innovative Solar 42, LLC. Use of less than $190,000 of the proceeds from this Note for any other purpose shall constitute a default of this Note, upon which all unpaid fees, accrued but unpaid interest (if any) and outstanding principal balance hereof shall become immediately due and payable.

 

8.  Governing Law. This Note shall be governed by, construed and enforced in accordance with, the laws of the State of Texas, excluding conflict of laws principles that would cause the application of laws of any other jurisdiction. Any action brought to enforce or interpret this Note shall be brought in the courts located in Dallas County, Texas.

 

9.  Transfers, Successors and Assigns. The provisions of this Note shall inure to the benefit of and be binding on any successor to Borrower and shall extend to any holder hereof; provided, however, that the Lender may not, without the prior written consent of Borrower (such consent not to be unreasonably withheld and such consent not to be required if an Event of Default exists), assign, transfer or negotiate this Note to any Person. Any such transfer or assignment must be in full compliance with applicable securities laws.

 

 

IN WITNESS WHEREOF, the Borrower and the Lender have duly executed this Promissory Note as of the date first written above.

 

 

	 	
BORROWER: 
	 	
 
	
 
	
LENDER: 
	 
	 	Michael Gorton, 	 	 	 	Guillermo G. Marmol, Trustee for	 
	 	CEO Principal Solar, Inc.	 	 	 	G. Marmol and G. Marmol Revocable Trust 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	
/s/ Michael Gorton
	 	
 
	
 
	
/s/ Guillermo G. Marmol
	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	
Dated: __April 1, 2016________________
	 	
 
	
 
	
Dated: _April 18, 2016
	 
	 	 	 	 	 	 	 

 

 

 

 

 

Exhibit 10.37 

Exhibit A

 

 

The Company is entitled to receive from Carolina Energy Partners II, LLC within 5 days of the commercial operation date ("COD") of the solar project Innovative Solar 46, LLC, the sum of $1,000,000 pursuant to Section 1.5(d) of that certain Assignment Agreement between Principal Solar, Inc.; Carolina Energy Partners II, LLC; Innovative Solar Systems, LLC; and Innovative Solar 46, LLC dated August 11, 2015; and

 

Further, the Company is entitled to receive from Innovative Solar Systems, LLC the sum of $624,000 pursuant to that certain Agreement between Principal Solar, Inc. and Innovative Solar Systems, LLC dated August 11, 2015.

 

The two amounts receivable described above, considered together as a single amount of $1,624,000, defines the term "IS 46 COD Payment" as used in the Promissory Note of which this Exhibit A is a part.ex10-38.htm

Exhibit 10.38

 

SETTLEMENT AGREEMENT AND RELEASE OF CLAIMS

 

This Settlement Agreement and Release of Claims (the “Agreement”) is made and entered into by Turtle Creek Holdings, LLC (“TCH”) and TCH Principal Solar, LP (“TCHPS”) (together, “Turtle Creek”) on the one hand, and Principal Solar, Inc. (“PSI”) and Michael Gorton (“Gorton”) (together the “PSI Parties”) on the other. Turtle Creek and the PSI Parties are collectively referred to in this Agreement as the “Parties.”

 

I.

 

RECITALS

 

A.     Turtle Creek invested approximately $1.0 million in PSI by the purchase of PSI’s common stock in 2015.

 

B.     As a result of that investment, Turtle Creek has asserted certain legal claims against the PSI Parties and is prepared to file a lawsuit against the PSI Parties in pursuit of those claims.

 

C.     The PSI Parties have denied liability for the claims asserted against them. The Parties have agreed to settle their disputes related to Turtle Creek’s investment in PSI without resort to litigation, pursuant to the terms set forth in this Agreement.

 

D.     PSI is in the process of closing the sale of a solar facility it refers to as ISS 42 NC, located in the state of North Carolina (the “ISS 42 Sale”). 

 

II. 

 

TERMS AND CONDITIONS

 

NOW, THEREFORE, in consideration of the covenants, promises, and releases set forth herein, and in full settlement of all claims between the Parties, the Parties hereby agree on behalf of themselves and any and all of their respective agents, servants, employees, and all persons, natural and corporate, in privity with them, as follows:

 

	 	
A.
	
Settlement Consideration

 

	 	
1.
	
Upon closing of the ISS 42 Sale, TCH will receive the first $300,000 of net proceeds that would otherwise be paid to PSI. Additionally, TCH will receive ten percent (10%) of the total net proceeds that would otherwise be paid to PSI. The initial $300,000 shall not be counted toward the 10% amount; however, the maximum proceeds payable to TCH is $800,000.1 “Net proceeds” as used herein refers to the total sale price of the ISS 42 Sale, minus any costs and fees incurred as part of the sale.

 

 

1 By way of example, if PSI is to receive net proceeds from the sale of $2 million, TCH will be paid $300,000 plus 10% of $2 million ($200,000), for a total of $500,000; however, if the sale were $6 million, TCH would be paid the maximum payment of $800,000, as the $6 million sale would yield $900,000, but for the $800,000 cap ($300,000, plus 10% of $6 million [$600,000] = $900,000).

 

 

1

 

 

	 	
2.
	
All payments due to TCH, as set forth in paragraph A.1. above, shall be directly funded to TCH at the closing of the ISS 42 Sale and shall not be paid to PSI first. 

 

	 	
3.
	
Upon receiving the amounts set forth above, TCH will return and transfer ownership of all its shares in PSI back to PSI, and the releases set forth below in Sections B.1 and B.2. shall become effective.

 

	 	
4.
	
Should the ISS 42 Sale fail to close, then this Agreement shall be void, TCH will retain its shares in PSI, and the releases set forth below in Section B shall not be effective.

 

	 	
B.
	
Releases

 

	 	
1.
	
Only upon the conditions set forth in Paragraph A.3 above, PSI and Gorton, for themselves and on behalf of all of their present and former principals, employees, staff, predecessors and successors, fully release and discharge TCH and TCHPS, and all of their present and former managers, employees, agents, consultants, attorneys, directors, and officers, and their respective insurers in their capacities as such from any and all claims, demands, damages, liabilities, actions, causes of action or suits at law or in equity, arising out of or relating to the claims asserted or that could have been asserted in any lawsuit relating to TCH’s and TCHPS’s investment in or relationship with PSI.

 

	 	
2.
	
Only upon the conditions set forth in Paragraph A.3 above, TCH and TCHPS, for themselves and on behalf of all of their present and former principals, employees, staff, predecessors and successors, fully release and discharge PSI and Gorton, and all of their present and former managers, employees, agents, consultants, attorneys, directors, and officers, and their respective insurers in their capacities as such from any and all claims, demands, damages, liabilities, actions, causes of action or suits at law or in equity, arising out of or relating to the claims asserted or that could have been asserted in any lawsuit relating to TCH’s and TCHPS’s investment in or relationship with PSI.

 

	 	
C.
	
General Terms and Provisions

 

	 	
1.
	
Representations and Authority to Enter into Agreement. Except as expressly stated herein, the Parties warrant, represent and agree that they: (i) have not assigned, subrogated, pledged or transferred to any person, firm, partnership, corporation or other entity whatsoever any of the claims, counterclaims, actions, demands or causes of action to be released pursuant to the releases set forth in this Agreement; and (ii) are fully authorized to enter into this Agreement without the consent of any third-parties. Specifically, each person signing the Agreement represents and warrants that upon execution of this Agreement, s/he has been authorized and empowered to sign this Agreement on behalf of the Party the person purports to represent and that this Agreement is a lawful and binding obligation of the Party on whose behalf the person is signing.

 

 

2

 

 

	 	
2.
	
Good Faith Compromise. This Agreement is entered into as a good faith compromise between the Parties for the complete and final settlement of the claims referred to above. By this settlement, the Parties do not admit liability in any respect, or make any admission as to factual or legal contentions relating to the matters settled herein.

 

	 	
3.
	
Execution of Necessary Documents. The Parties further covenant and agree to execute any and all documents reasonably necessary to effectuate the provisions of this Agreement.

 

	 	
4.
	
Plain Meaning. The Parties acknowledge that they have had the opportunity to be represented by counsel during negotiations of this Agreement and to consult with their respective attorneys regarding its meaning and effect. The Parties agree that: (a) the terms and provisions of this Agreement are not to be construed more strictly against any of the Parties; and (b) it is their mutual intention that the terms and provisions of this Agreement be construed as having the plain meaning of the terms used herein.

 

	 	
5.
	
Execution in Counterparts. This Agreement may be signed in multiple counterparts, and the separate signature pages executed by the Parties may be combined to create a document that is binding on all of the Parties and together shall constitute one and the same instrument.

 

	 	
6.
	
Choice of Law. It is understood and agreed that this Agreement shall be governed by, construed, and enforced in accordance with, and subject to, the laws of the State of Texas. Venue shall lie in Dallas County, Texas.

 

	 	
7.
	
Headings and Numbering. Any paragraph, article, and/or section headings or paragraph numbers used in this Agreement are for convenience only and shall not affect the construction of the Agreement.

 

	 	
8.
	
Severability. If any of the provisions of this Agreement, or the application thereof, shall, for any reason or to any extent, be construed by a court of competent jurisdiction to be invalid or unenforceable, the remainder of this Agreement, and application of such provisions to other circumstances, shall remain in effect and be interpreted so as best to reasonably effect the intent of the Parties.

 

	 	
9.
	
Amendments. This Agreement may be amended only by a written agreement signed by each of the Parties, and any alleged breach of this Agreement may be waived only by a written waiver signed by the party granting the waiver. 

 

 

3

 

 

DATED: May 3, 2016

PRINCIPAL SOLAR, INC.

 

 

By:       /s/ Michael Gorton            

Print Name: Michael Gorton                    

Title: Chief Executive Officer                              

 

 

 

DATED: May 3, 2016

MICHAEL GORTON

 

 

By:      /s/ Michael Gorton             

Print Name: Michael Gorton                         

 

 

 

 

DATED: March 29, 2016 

TURTLE CREEK HOLDINGS, LLC 

 

 

By:     /s/ Scott Olson

Print Name: Scott Olson                         

Title:     Member

 

 

 

DATED: March 29, 2016 

TCH PRINCIPAL SOLAR, LP

 

 

By:       /s/ Scott Olson      

Print Name: Scott Olson                    

Title:     Manager of GP     

 

 

4

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