Document:

altn_ex1030.htm

EXHIBIT 10.30
 
 
SUBSCRIPTION CONTRACT RELATING
 
TO A 8,628,000 EURO
 
BOND ISSUE COMPOSED OF 8,628,000 BONDS
 
[Place, __ June 2019]
  	 
	
	
 
	 

 
BETWEEN THE UNDERSIGNED:
 
1. [*]. Hereinafter referred to as the “Subscriber”.
 
2. POWER CLOUDS EUROPE B.V., a Dutch company with a capital of 10.000,00 Euros, registered under the number 66669618, with head office located at Evert van de Beekstraat, 104 The Base B, 1118CN Schiphol, Netherlands, represented by Vincent Browne in his capacity as sole director. Hereinafter referred to as the “Issuer”.
 
3. PC-ITALIA 02 S.p.A., an Italian company with a capital of 50,000 Euros, registered with the Companies Register of Caserta under no. 304731, tax and VAT code 04173980618,, with head office located at Via Ferrovie dello Stato no. 61 – Gricignano di Aversa (CE), 81030, , represented by Vincent Browne in his capacity as sole director. Hereinafter referred to as the “HoldCo”.
 
4. ALTERNUS ENERGY INC., a Nevada corporation registered with the Secretary of State of Nevada under no. E0837352006-2 with corporate headquarters located at One World Trade Center, Suite 8500, New York, NY 10007, represented by Vincent Browne in his capacity as Chief Executive Officer. Hereinafter referred to as the “Sponsor”. 
 
The Issuer, the Subscriber, and the HoldCo hereafter collectively referred to as the “Parties” or individually as “Party”.
 
AFTER HAVING PREVIOUSLY ESTABLISHED AND AGREED THAT:
 
1. The Issuer acquired the following PV projects (all jointly referred to as the “Projects”): 
 
a. Anagni project is an operational PV project of 986 kWp located in Lazio, Italy and fully owned by HoldCo;
 
b. Budrio 1 project is an operational PV project of 360 kWp located in Emilia Romagna, Italy and fully owned by HoldCo;
 
c. Budrio 2 project is an operational PV project of 898 kWp located in Emilia Romagna, Italy and fully owned by HoldCo;
 
d. CIC RT project is an operational PV project of 846 kWp located in Veneto, Italy and fully owned by CIC Treviso S.R.L. (referred to as “SPV 1”);
 
e. CIC RT 2 project is an operational PV project of 998 kWp located in Emilia Romagna, Italy and fully owned by CIC Rooftop S.R.L. (referred to as “SPV 2”);
 
f. White One project is an operational PV project of 994 kWp located in Sardinia, Italy and fully owned by White One S.R.L. (referred to as “SPV 3”);
 
g. Grotte Barca project is an operational PV project of 346 kWp located in Lazio, Italy and fully owned by New Power Italia 1 S.R.L. (referred to as “SPV 4”);
 
h. Campo Fiera project is an operational PV project of 967 kWp located in Lazio, Italy and fully owned by SPV 4;
 
i. CTS Power 1 project is an operational PV project of 346 kWp located in Sicily, Italy and fully owned by CTS Power 2 S.R.L. (referred to as “SPV 5”);
 
j. CTS Power 2 project is an operational PV project of 546 kWp located in Lazio, Italy and fully owned by SPV 5.
 
SPV 1, SPV 2, SPV 3, SPV 4 and SPV 5 jointly referred to as the “SPVs”.
 
	 
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2. The SPVs are fully owned by HoldCo.
 
3. The business plan related to the Projects (the “Business Plan”) has been provided to the Subscriber on May 7, 2019 and is attached in Appendix 3. 
 
4. The Issuer is willing to enter into a bridge financing (the “Bridge Facility”), which is intended to stay in place until long term senior debt financing is secured for the Projects at the Issuer’s, HoldCo’s or SPVs’ level (the “Long Term Debt Refinancing”).
 
5. The Subscriber is hereby willing to provide said Bridge Facility, through the subscription of bonds issued by the Issuer, as governed by this contract (the “Subscription Contract”).
 
6. This Subscription Contract governs the bond issue for a total amount of EIGHT MILLION AND SIX HUNDRED TWENTY-EIGHT THOUSAND Euros (€ 8,628,000) (the “Bond Issue”), in the form of cash-settled bonds (the “Bonds”). The Subscription Contract also governs the irrevocable undertaking by the Subscriber to subscribe the Bonds issued, subject to conditions listed in Section 3.3. and pay-up the subscription amount upon signature of the Subscription Contract (the “Subscription”).
 
7. Upon receipt of the funds, the proceeds of the Issue of the Bonds shall be destined solely to repay in full the principal and interests of the Class S promissory note (the “ Class S Note”) signed on December 20, 2018 between the Issuer, Inmost Partners LLC (the “Noteholder Agent”) and Discovery Europe Solar Senior fund #1 (the “Class S Noteholder”), and issued by the Issuer on December 28, 2018 as well as the different fees related to the execution of the Bridge Facility (hereinafter referred as the “Use of Proceeds of the Issuance”). 
 
8. In addition to the Class S Note, the Issuer issued on December 28, 2018 a class J promissory note, as modified and extended on June 3, 2019 (the “Class J Note”) following the signing of a note issuance and purchase agreement on December 20, 2018 between the Issuer, the Noteholder Agent and IDC DR Fund LP (the “Class J Noteholder”). In addition to the Class S Note and the Class J Note, the Issuer issued on December 18, 2018 a promissory note to IDC DR Fund LP which was modified and extended on June 3, 2019 (the “IDC Note”) This Class J Note and the IDC Note will remain in place and will not be repaid before the Bond Redemption Date (as defined hereinbelow).
 
9. The Bonds issued and subscribed shall be repaid by March 31, 2020 at the latest (the “Maturity Date”). 
 
The issuance period (the “Issuance Period”) will last between the date of issuance of the Bonds (the “Issuance Date”) and the date at which all Bonds will have been repaid, including due interests and fees (the “Issuance Redemption Date”).
 
	 
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PURSUANT TO THE ABOVE IT HAS BEEN SETTLED AND AGREED THAT:
 
1. REPRESENTATIONS AND UNDERTAKINGS MADE BY THE PARTIES
 
1.1 Representations and Undertakings by the Issuer and the HoldCo.
 
The Issuer acknowledges that the Subscriber subscribes to the Bonds in consideration of the following representations by the Issuer, the HoldCo on its own behalf and the HoldCo on behalf of the SPVs (the “Representations of the Issuer and the HoldCo”):
 
a) there is no shareholder loan or intercompany loan between the Issuer and its sole shareholder, the Sponsor;
 
b) the Issuer owns directly 100% of the HoldCo; 
 
c) the HoldCo owns directly 100% of the SPVs;
 
d) the Issuer, the HoldCo and the SPVs are legally constituted entities, in compliance with their applicable laws, and are fully entitled to hold assets and are fully authorised to exercise their business activities in their current form;
 
e) the HoldCo and the SPVs own, directly or indirectly, 100% of the existing rights of the Projects; 
 
f) the Issuer, the HoldCo and the SPVs are not involved in, or, are not aware of any circumstance which may lead to any litigation, particularly with their contracting or administrative counterparties;
 
g) the Issuer has full powers and the legal capacity to undertake and fulfil its obligations under this Subscription Contract;
 
h) the Issuer has obtained all of the authorisations from internal bodies required by the law and under its corporate articles to undertake and fulfil its obligations under this Subscription Contract;
 
i) at the date of the Subscription Contract, no procedures are pending, or have been initiated against, or by, the Issuer or the HoldCo (with the understanding that any submission or filing made in order to initiate such a procedure shall only be considered as pending if it has already been deemed admissible by the competent jurisdiction) with the objective of (i) seeking an out-of-court settlement, (ii) a conciliation procedure or the designation of a special purpose trustee, (iii) a judicial insolvency procedure, or (iv) a judicial liquidation procedure;
 
j) HoldCo’s, SPVs’ and Issuer’s assets, shares, shareholder loans, and future payments associated to the Projects are not pledged except in relation with the Class J Note and IDC Note which shall be governed by the Subordination Agreement (as defined hereinbelow);
 
	 
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k) the Issuer, at the date of signing of the present Subscription Contract, does not have any debt towards any entity, different than the Subscriber, except the debt towards the Class J Noteholder as described in Section 8 above;
 
l) the HoldCo and the SPVs, at the date of signing of the present Subscription Contract, do not have any debt towards any entity, except the shareholder loan granted by the Issuer to the HoldCo;
 
m) the HoldCo owns directly Sant’Angelo Energy S.r.l. which has signed a leasing agreement with UniCredit Leasing S.pA. on 3 October 2012 (the “Leasing Agreement”). Under the terms and conditions of the Leasing Agreement, there is no recourse on the HoldCo. No terms or conditions in the Leasing Agreement may hinder the enforcement of any pledge included as part of the Collateral. 
 
1.2 The Issuer acknowledges that the Subscriber subscribes to the Bonds in consideration of the following undertakings by the Sponsor, the Issuer, the HoldCo on its own behalf and the HoldCo on behalf of the SPVs (the «Undertakings of the Issuer and the HoldCo »):
 
a) there will not be any shareholder loan or intercompany loan between the Issuer and the Sponsor;
 
b) the Issuer will own directly 100% of the HoldCo during the whole Issuance Period;
 
c) the HoldCo will own directly 100% of the SPVs during the whole Issuance Period;
 
d) the HoldCo and the SPVs will own, directly or indirectly, 100% of the existing rights of the Projects; 
 
e) the Issuer, the SPVs and the HoldCo will not incur into any further debt;
 
f) the Issuer will not during the whole Issuance Period pay to the Sponsor any dividend or shareholder loan payment (principal or interests) or any other payment;
 
g) the Issuer will not during the whole Issuance Period pay any sums under the Class J Note or the IDC Note (including principal repayment, interests, late-payment interests, fees, penalties and associated sums); 
 
h) During the whole Issuance Period, Issuer’s, SPVs and HoldCo’s assets, shares, shareholder loans, and future payments associated to the Projects, will not be pledged, except in relation with the Class J Note and IDC Note, which shall be governed by the Subordination Agreement (as defined hereinbelow);
 
i) the Issuer undertakes to comply with the Use of Proceeds of the Issuance during the whole Issuance Period;
 
j) the Issuer and the HoldCo undertake to take all the necessary steps in order to transform the SPVs into “Società per azioni” (“Transformation of the SPVs”) within three (3) months after the Subscription Date;
 
k) the HoldCo undertakes to give a first rank pledge on the SPVs’ shares by the earlier of (i) October 31, 2019 and (ii) the date three (3) months after the date of the Transformation of the SPVs;
 
	 
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l) the Sponsor is required and undertakes to give a first ranking right of pledge on the shares in the capital of the Issuer, as security for the fulfilment of all monetary payment obligations of the Issuer under the Subscription Contract; 
 
m) the Issuer undertakes to repay, on or immediately after the Subscription Date (as defined hereinbelow), in full the principal and interests of the Class S Note and to report to the Subscriber within three (3) Working Days:
 
(i) a certified document evidencing the full repayment of this the Class S Note;
 
(ii) a certified copy of the release statement of the pledge from Class S Noteholder over all Issuer’s assets of every kind and nature.
 
“Working Day” means a day, other than a Saturday or Sunday, on which the banks are opened for business in (i) Amsterdam, the Netherlands and (ii) Paris, France. 
 
n) The Issuer undertakes to report to the Subscriber:
 
(i) on the tenth Working Day of every other month: (i) the state of progress regarding the negotiation of the Long Term Debt Refinancing (ii) the production in (kwh) of the Projects and revenues earned by the HoldCo and the SPVs, if any; it has been agreed between the Parties that the first report shall be submitted to the Subscriber by the Issuer on July 10th and every other month thereafter;
 
(ii) the sixtieth Working Day of every other quarter: the P&L report of the SPVs, the HoldCo and of the Issuer, that the first report shall be submitted to the Subscriber by the Issuer before August 31st. 
 
1.3 Subscriber Representations
 
The Subscriber acknowledges that the Issuer agrees to the Subscription Contract in consideration of the following representations by the Subscriber (the “Subscriber Declarations”):
 
a) the Subscriber is a legally constituted entity, in compliance with its applicable laws, and is fully entitled to hold assets and is fully authorised to exercise its business activities in their current form;
 
b) the Subscriber has full powers and the legal capacity to undertake and fulfil its obligations under this Subscription Contract;
 
c) the Subscriber has obtained all of the authorisations from internal bodies required by the law and under its corporate articles to undertake and fulfil its obligations under this Subscription Contract;
 
d) the Subscription Contract constitutes for the Subscriber valid commitments and rights for the Issuer, which commit the Subscriber under its terms;
 
e) the signature and the application by the Subscriber of the Subscription Contract does not contravene any laws or regulatory or statutory requirements, or any ruling or authorisation to which the Subscriber may be subject; 
 
f) at the date of the Subscription Contract, no procedures are pending, or have been initiated against, or by, the Subscriber (with the understanding that any submission or filing made in order to initiate such a procedure shall only be considered as pending if it has already been deemed admissible by the competent jurisdiction) with the objective of (i) seeking an out-of-court settlement, (ii) a conciliation procedure or the designation of a special purpose trustee, (iii) a judicial insolvency procedure, or (iv) a judicial liquidation procedure.
 
	 
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2. Bond issue amount 
 
The total amount of the Bond Issue, that the Issuer undertakes to issue and that the Subscriber undertakes to subscribe to, under the conditions set out herein, is set at EIGHT MILLION SIX HUNDRED TWENTY-EIGHT THOUSAND Euros (€8,628,000), which corresponds to the subscription price (the “Subscription Price”). 
 
Each Bond shall have a nominal value of one (1) euro.
 
Each Bond is redeemable under the conditions stipulated hereinbelow.
 
3. Bond issue characteristics
 
3.1 Issue duration
 
The Bond Issue is granted for a period starting on the Issuance Date and closing on the Maturity Date at the latest, which is the date on which the Bonds shall be redeemed in cash by right of priority.
 
3.2 Subscription and payment in full
 
The Bonds shall be issued at the unit price of one (1) euro and shall be subscribed by the Subscriber at their nominal value of one (1) euro, i.e. a total amount of EIGHT MILLION AND SIX HUNDRED TWENTY-EIGHT THOUSAND Euros (€ 8,628,000) for the EIGHT MILLION AND SIX HUNDRED TWENTY-EIGHT THOUSAND Bonds issued and subscribed, if applicable, as agreed upon in the Subscription Contract.
 
The Bonds shall be subscribed by the Subscriber (the “Subscription”) on the Issuance Date, subject to the conditions precedent having been fulfilled (“Conditions Precedent”), in the terms agreed in Section 3.3 hereinbelow (the “Subscription Date”).
 
Bonds will carry interest from the Subscription Date in accordance with Sections 3.7 through 3.12 .
 
3.3 Conditions Precedent
 
The Conditions Precedent shall be fulfilled when the Issuer provides to the Subscriber the relevant documentation certifying that the following conditions precedent have been met: 
 
	 
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a) the conclusion in favour of the Subscriber of the following pledges (the “Collateral”), in order to secure payment of all sums due under the Subscription Contract (including interests, late-payment interests, fees, penalties and associated sums due);
 
i. First rank pledge on the Issuer’s shares owned by the Sponsor;
 
ii. First rank pledge on HoldCo’s shares owned by the Issuer;
 
iii. First rank assignment by way of security over the shareholder loan receivables granted by the Issuer to the HoldCo.
 
b) The conclusion of a subordination agreement between the Issuer, the Subscriber, the Noteholder Agent and the Class J Noteholder in order to establish that the Subscription Contract is senior to the Note in any case (hereafter referred as the “Subordination Agreement”);
 
c) the issuance of a copy of the written resolutions of the Issuer’s general assembly and/or the governing body, as appropriate,: 
 
i. authorising the signature and application of the Subscription Contract; 
 
ii. authorising the signature and application of the relevant Collateral; 
 
iii. authorising the signature and application of the Subordination Agreement;
 
iv. approving the Bond Issue.
 
d) a copy of the current corporate articles of the SPVs, the HoldCo and the Issuer;
 
e) an original of the SPVs’, HoldCo’s and Issuer’s corporate registration certificates issued no later than thirty (30) days prior to the Issuance Date; and
 
f) an original of the SPVs’, HoldCo’s and Issuer’s certificates of good standing issued no later than thirty (30) days prior to the Issuance Date.
 
	 
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3.4 Subscription Price Payment Terms
 
a) The Subscriber shall submit to the Issuer a filled-in and signed subscription form relating to the Bonds subscribed to by the Subscriber, using the standard form provided in Appendix 1.
 
b) A cash amount in Euros equal to the total amount of the Subscription Price of the subscribed Bonds shall be credited by the Subscriber to the Issuer’s account using the bank account details recorded in Appendix 2 of this Subscription Contract. 
 
Subject to points (a) and (b) above, the Issuer shall register the subscribed Bonds in the name of the Subscriber.
 
3.5 Subscription Price Allocation
 
The Subscription Price for the entire Bonds issued shall be allocated by the Issuer to the Use of Proceeds of the Issuance.
 
The Subscriber is not obliged to check whether the Issuer has used the Subscription Price in accordance with the Use of Proceeds of the Issuance and cannot therefore be held liable on this account. 
 
3.6 Form of the Bonds
 
The Bonds are issued in registered form recorded in a register held by the Issuer. No request has been made, or shall be made, to list the Bonds for trading on a regulated market.
 
3.7 Interest
 
Each Bond bears interest to the benefit of the Subscriber from its respective Subscription Date until the date on which the Bond shall be redeemed (the “Bond Redemption Date”), either in the context of (i) the Redemption at the Maturity Date, (ii) a Voluntary Early Redemption as defined in Section 4.3 , (iii) a Debt Refinancing Redemption as defined in Section 4.2 , or (iv) in the event of an Acceleration Event (as defined in Section 4.4 ) or a Case of Default under the conditions stipulated in Section 4.6. 
 
3.8 Interest Period
 
Interest is calculated according to the period (“Interest Period”) during which the Bonds are subscribed and not redeemed:
 
a) The first Interest Period starts on the Issuance Date and ends on 31 October, 2019 (the “First Interest Period”); and
 
b) The second Interest Period starts on November 1, 2019 and shall last until the Maturity Date (the “Second Interest Period”).
 
	 
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3.9 Interest Rates
 
The fixed annual interest rate, calculated on the subscribed and outstanding amount of the Bonds (the “Rate”) over three hundred and sixty (360) days, is set as followed:
 
(i) for the First Interest Period, the Rate is seven-point five percent (7.5 %); 
 
(ii) for the Second Interest Period, the Rate is ten percent (10 %).
 
3.10 Interest Calculation
 
Interest for the Interest Periods shall be calculated prorate temporis on the basis of the number of actual days during which each bond is drawn and until it is redeemed, divided by 360. 
 
3.11 Interest Payments
 
Interest payable for each Bond shall be paid at the date of Redemption Date of the Bond.
 
In the event of the early redemption of a Bond, the accrued interest on the Bond shall be paid concomitantly to its redemption. All amounts subject to early redemption shall be accompanied by interest accrued by the Issuer for the Bonds which have been redeemed early and, where applicable, Early Redemption Compensation, as defined in Section 4.7 .
 
3.12 Late Payment of Interest
 
In the event of payment default at due date of an amount due by the Issuer with regard to the Bonds and/or the Subscription Contract (a “Payment Default”), the amount in question shall bear full interest, without prior notice, from the due date until the date of effective payment for the sum in question, at a rate of ten percent (10 %) (“the Late Payment Interest Rate”).
 
The Subscriber shall notify the Issuer of the Payment Default and shall grant to the Issuer a grace period of five (5) Working Days (the “Grace Period”). Once the Grace Period has lapsed without remedy, the Subscriber will be entitled to apply the Late Payment Interest Rate. 
 
3.13 Structuring fees
 
The Subscription shall give rise to the payment by the Issuer to the Subscriber of structuring fees (the “Structuring Fees”) totalling FIFTY THOUSAND Euros (€50,000). The Structuring Fees are payable by the Issuer on the Subscription Date. The Structuring Fees shall be deducted from the Subscription Price of the subscribed Bonds due by the Subscriber. The fees due to Ardour Capital Investments LLC shall be paid from the Subscription Price under the Use of Proceeds of the Issuance.
 
3.14 Legal Costs
 
All reasonable legal costs incurred by the Subscriber related to the preparation or the execution of the Subscription Contract or of the Collateral will be borne by the Issuer.
 
	 
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3.15 Sale of the Bonds
 
The Subscriber undertakes not to sell the Bonds until the Maturity Date, or, in the event of a Case of Default or an Acceleration Event, until the Date of the Acceleration Notice, as described in Section 4.6, with the exception of any sale of 100% of the Bonds by the Subscriber to an Affiliate of the Subscriber, or a fund managed by the Subscriber, or one of its Affiliates, provided that the Affiliate or the fund concerned agrees to the Subscription Contract, being understood that if the transferee ceases to be an Affiliate of the Subscriber, the Subscriber undertakes to repurchase the Bonds.
 
For the requirements of this Section 3.10, “Affiliate” designates any entity which:
 
(i) controls the Subscriber; or 
 
(ii) is controlled by the Subscriber; or 
 
(iii) is controlled by an entity which controls the Subscriber; 
 
The Subscriber undertakes to inform the Issuer fifteen (15) Working Days in advance of any sale of all or part of the Bonds which may occur in accordance with the stipulations of this Section 3.10, with the sale or transfer of the Bonds processed by the Issuer by inter-account transfer upon receipt of proof of a contract note signed by the seller and then transcribed in the register held by the Issuer.
 
Any transfer of the Bonds shall entail full agreement with all of the Issue and Subscription terms and the divestment of all rights attached to each Bond.
 
Notwithstanding the above, the Subscriber only sell and/or transfer Bonds to any person if:
 
(i) after such sale or transfer, such person holds at least ONE HUNDRED THOUSAND (100,000) Bonds; and
 
(ii) after such sale or transfer, the Subscriber (or the relevant seller) will either (a) no longer hold any Bonds, or (b) still hold at least ONE HUNDRED THOUSAND (100,000) Bonds,
 
and the Parties agree that any sale and/or transfer in violation of the above requirements shall be null and void. 
 
3.16 Subordination – Collateral
 
The Issuer undertakes to refrain from concluding any type of commitment whatsoever which would entail the payment of amounts due pertaining to the Bonds and to the Subscription Contract becoming subordinated to the payment of any new financial debt subscribed by the Issuer. 
 
It is specified that the undertaking stipulated above does not prohibit the Issuer from subscribing to financial debt or obtaining any other kind of financial indebtedness with the aim of funding the total redemption of the Bonds and the payment of all sums of any nature due by the Issuer to the Subscriber under the Subscription Contract. 
 
At the Subscription Contract signature date, other than the Collateral (as defined in Section 3.3), no financial security or collateral currently exists except for the undertaking to post collateral in relation with the Class J Note and IDC Note.
 
From the Subscription Contract signature date and until the Issuance Redemption Date, no further financial security or collateral shall be granted, on the Issuer ́s receivables, securities or assets related to the Projects.
 
	 
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The Issuer undertakes to maintain the validity of the Collateral as long as the full amounts due to the Subscriber have not been definitively paid and redeemed. 
 
4. Redemption of the Bonds
 
4.1 Period for the Redemption of Bonds
 
The Bonds shall be redeemed by the Issuer to the Subscriber at the latest at the Maturity Date.
 
4.2 Debt Refinancing Redemption 
 
If a Long Term Debt Refinancing is executed, the Issuer shall, immediately after obtaining the relevant loan proceeds, redeem in cash (the “Debt Refinancing Redemption”) the totality of the Bonds, including the outstanding principal and interest, and the Early Redemption Compensation. 
 
The Subscriber shall reasonably cooperate with the release of all Collateral in connection with and in order for the Issuer to obtain the Long Term Debt Financing, and shall in any case release the Collateral upon the redemption of the Bonds, including the outstanding principal and interest, and the Early Redemption Compensation.
 
The redeemed Bonds shall be cancelled immediately. 
 
4.3 Voluntary Early Redemption
 
The Issuer reserves the right at any time to redeem all or part of the Bonds at an earlier date than the Maturity Date (“Voluntary Early Redemption”) without incurring any penalties other than, where applicable, the Early Redemption Compensation.
 
The redeemed Bonds shall be cancelled immediately. 
 
4.4 Acceleration Events
 
Apart from the cases provided for in Sections 4.1, 4.2 and 4.3, each of the events referred to below constitutes an acceleration event (“Acceleration Event”): 
 
a) The modification of the business purpose set in the bylaws of the Issuer, the HoldCo or the SPVs at the time of the Subscription Contract;
 
b) One representation of the Issuer is false or inaccurate, at the time when it was made, this potentially leading, in the reasonable analysis of the Subscriber, to non-payment by the Issuer of the amounts due to the Subscriber;
 
c) Non-compliance by the Issuer or the HoldCo with one of the Undertakings of the Issuer and the HoldCo;
 
d) The Subordination Agreement is terminated, except in the case of the redemption of the Class J Note;
 
	 
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e) Any change of control with respect to the Issuer, whereby the term “control” is defined as ownership of at least 50% of the voting rights attached to the shares in the capital of the Issuer or any legal entity controlling the Issuer, unless with the prior written consent of the Subscriber;
 
f) Any change in regulation, decision from the administrative authorities, or signing of contract, causing a negative effect of more than 5% on the cash flow available for debt service over the life of the Projects, as determined in the Business Plan, which would not be compensated by positive factors that were unknown at the Issuance Date.
 
4.5 Case of Default
 
Each of the events referred to below constitutes a case of default, if it is not resolved within ten (10) Working Days from the earlier of the day on which the Subscriber notifies the Issuer in writing of such event and the day on which the event is observed by the Issuer (a “Case of Default”):
 
a) The non-repayment of any amount due under the Subscription Contract, including due interests and fees, by the Issuer at the due date,
 
b) The dissolution of the Issuer, the HoldCo or of one of the SPVs, the initiation against, or by, the Issuer, the HoldCo or one of the SPVs, of an insolvency process, or of any process with the objective of (i) seeking an out-of-court settlement, (ii) a conciliation procedure or the designation of a special purpose trustee, (iii) a judicial insolvency procedure, or (iv) a judicial liquidation procedure (with the understanding that any submission or filing made in order to initiate such a procedure shall only be considered as pending if it has already been deemed admissible by the competent jurisdiction).
 
4.6 Procedure in the event of an Acceleration Event or a Case of Default 
 
In the event of an Acceleration Event associated with the Issuer, or a Case of Default, the Subscriber may request cash redemption by providing the Issuer with a written notice to such effect (the “Acceleration Notice”). 
 
The Issuer shall be obliged to proceed with cash redemption of all of the Bonds and any other amount due under the Subscription Contract, within ten (10) Working Days from the receipt of the Acceleration Notice. As such, the Issuer’s available cash position, net of all debts and social charges, as well as all monies owed to the tax administration and social security bodies, shall be allocated by right of priority to the redemption of the Bonds concerned (including all interests and costs due under the Subscription Contract).
 
4.7 Early Redemption Compensation
 
In the event of early redemption of all of the Bonds, resulting from a Voluntary Early Redemption, a Debt Refinancing Redemption or for any other reason whatsoever (including an Acceleration Event or a Case of Default), the Issuer must pay the Subscriber the difference (the “Early Redemption Compensation”), if positive, between: 
 
i. ONE HUNDRED FIFTY THOUSAND EUROS (€150,000); and
 
ii. the sum of all paid and accrued Interests. 
 
	 
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The Early Redemption Compensation referred to above shall be due by the Issuer and payable on the date on which all of the Bonds are redeemed early.
 
5. Collateral
 
As security for the payment of all amounts due, of any kind, or which shall become due by the Issuer to the Subscriber (including interests, late-payment interests, fees, penalties and associated sums due) under the Subscription Contract, the Issuer will grant in favour of the Subscriber, on the Subscription Contract signature date, the Collateral. 
 
The Collateral shall be immediately released at the date of the Issuance Redemption Date.
 
6. Interpretation rules
 
All references to the Subscription Contract include the Subscription Contract and the previously-established points section and the Appendixes, which are an integral part of the Subscription Contract and shall be considered as such for all legal purposes.
 
7. Enforced Execution
 
The Parties acknowledge that each of the stipulations within this Subscription Contract may be enforced by the competent courts.
 
8. Applicable law and Jurisdiction
 
This Subscription Contract is governed by Dutch law. 
 
Any litigation between the Parties shall be judged by the courts of the city of Amsterdam, the Netherlands. The Parties expressly relinquish the right to file any litigation between the Parties with any other court than the courts of Amsterdam, the Netherlands. 
 
9. Modification of the Subscription Contract
 
The Subscription Contract can only be modified with the written agreement of the Parties.
 
	 
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10. Confidentiality 
 
The Subscription Contract, its object and content are confidential. The Parties acknowledge that the stipulations of this Section 10 do not apply to the respective advisors of the Parties, provided that the advisors are held by confidentiality obligations.
 
The Parties shall undertake all necessary measures to ensure confidentiality. Exemption may be granted only with written prior agreement from the other Party, or in order to enable one of the Parties to respect a legal or administrative obligation, if so permitted by the applicable regulations, provided that the other Party has been informed in advance and, in all cases, strictly respecting the scope of the prior agreement and these obligations.
 
11. Notification
 
Any notification, request or communication in application of this Subscription Contract shall be sent by registered post, with confirmation of receipt, to the address of the recipient Party recorded on page 1 of this Subscription Contract.
 
In witness whereof, the Parties hereby sign this Agreement in [...] sheets of unstamped paper on their both sides, appendices included, in one version in English language, and in two counterparts and the place and on the date shown in the heading. 
 
	_______________
POWER CLOUDS EUROPE B.V. 
Mr. Vincent Browne
		 
[*]

			 
____________________

			 

	PC-ITALIA 02 S.p.A.
Mr. Vincent Browne
	 
	ALTERNUS ENERGY INC.
Mr. Vincent Browne
____________________

 
 
	 
	15altn_ex1031.htm

EXHIBIT 10.31
 
SUBORDINATION AGREEMENT
 
THIS SUBORDINATION AGREEMENT (the “Agreement”) is made and executed as of __ June, 2019, by and among (i) Power Clouds Europe B.V., a Netherlands limited liability company, having an address at The Base B, Evert van de Beeksgtraat 104, Schiphol, 1118CN, the Netherlands, represented by Mr. Vincent Browne, in his capacity as sole director (the “Borrower”), (ii) PC-Italia-02 S.p.A., a company incorporated under the laws of Italy, having its registered offices at Via Ferrovie dello Stato snc, 81030 Gricignano di Aversa (CE), Italy, corporate capital Euro 10,000, fully paid in, registered with the Companies’ Registrar of Caserta, tax code and VAT number 04173980618, represented by Mr. Vincent Browne, in his capacity as sole director (together with the Borrower, collectively, the “Credit Parties”), (iii) [*] (“[*]”), and (iv) InMost Partners LLC and IDC Dr Fund LP, each having an address at 1500 Broadway, Suite 704, New York, NY 10036 (together, collectively, the “Subordinated Creditor”).
 
W I T N E S S E T H:
 
WHEREAS, the Subordinated Creditor has made and secured obligations outstanding and owed by the Borrower (collectively, the “Existing Obligations”), which obligations are evidenced by (i) that certain Security Agreement, Pledge, Guarantee and the €3,849,333.26 Note issued on December 18, 2018 by and among the Borrower and the Subordinated Creditor, as modified to reflect the current outstanding principal balance of €450,000 and extended on June 3, 2019, and (ii) that certain Note Issuance and Purchase Agreement, dated December 20, 2018, including the €2,580,000 Class J Promissory Note, by and among the Borrower and the Subordinated Creditor, as modified and extended on June 3, 2019; and
 
WHEREAS, [*] will subscribe to the bonds issued by the Borrower in a total amount of Eight Million Six Hundred Twenty Eight Thousand and No/100 Euros (EUR €8,628,000.00) (the “[*] Bonds”), which [*] Bonds will be secured by collateral to be posted by the Credit Parties and certain affiliates of the Borrower, such collateral as further described in that certain Subscription Contract related to a EUR €8,628,000 Bond Issue Composed of €8,628,000 Bonds dated as of [05] June, 2019 (the “Bond Subscription Contract”); and
 
WHEREAS, all of Credit Parties’ obligations to [*] under the Bond Subscription Contract are secured by those certain Security Agreements (as defined hereinafter), each dated of even date with the Bond Subscription Contract, each made by and between each Credit Party and [*] (the “Security Agreements”), which Security Agreements provide to [*] a continuing and unconditional first priority security interest (“[*]’s Security Interest”) in the “Collateral” (as used in this Agreement, such term means the assets that are subject to the security rights created pursuant to the Security Agreements) of the Credit Parties; and
 
WHEREAS, the Subordinated Creditor has agreed to subordinate: (i) all of Credit Parties’ indebtedness and obligations to the Subordinated Creditor, whether presently existing or arising in the future, as amended, restated, renewed or supplemented from time to time (the “Subordinated Debt”); and (ii) all of the Subordinated Creditor’s security interests of any nature or kind in the Credit Parties’ property and assets, to the Senior Debt (as defined hereinafter) and to [*]’s Security Interest, all as more specifically hereinafter set forth;
 
	 
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NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and other good and valuable consideration, the Credit Parties, [*] and the Subordinated Creditor do hereby agree as follows:
 
1. Recitals; Definitions. The recitals set forth above are true and correct and are incorporated herein by reference. Capitalized terms used in this Agreement and not otherwise defined herein, shall have the same meanings ascribed to such terms in the Bond Subscription Contract.
 
2. Subordination. Until the [*] Bonds, and all other obligations of any nature or kind of the Credit Parties to [*] under the Bond Subscription Contract, whether now existing or hereafter arising, together with all costs of collection (including attorneys’ fees and court costs and expenses throughout all trial and appellate levels and all negotiations, mediations, arbitrations and bankruptcy proceedings) (collectively, the “Senior Debt”) are indefeasibly paid in full (hereinafter referred to as a “Discharge” or as the Senior Debt being “Discharged”), the Subordinated Creditor does hereby subordinate any right to payment or distribution by or on behalf of the Credit Parties, directly or indirectly, of assets of the Credit Parties of any kind or character for or on account of the Subordinated Debt , to the prior payment in full of the Senior Debt, and the Subordinated Creditor agrees that until such time as the Senior Debt has been Discharged. The Subordinated Creditor, to the fullest extent permitted by applicable law, waives as to [*], any requirement regarding, and agree not to demand, request, plead or otherwise claim the benefit of, any marshaling, appraisement, valuation or other similar right that may otherwise be available to the Subordinated Creditor under applicable law with respect to any Collateral.
 
3. Subordinated Creditor Liens. The Subordinated Creditor hereby agrees with [*] and the other parties that any and all security interests, liens, charges, encumbrances or other interests that are to be created in favor of the Subordinated Creditor in any assets of the Credit Parties or any shares in the capital of the Credit Parties as security for the Subordinated Debt (the “Subordinated Creditor Liens”), shall be second ranking to the Collateral (as defined in the Bond Subscription Contract), and shall not be created, and the Subordinated Creditor shall not request any person to create any Subordinated Creditor Lien, prior to a valid security interest, lien, charge, encumbrance or other interest having been created on such assets in favor of [*] as security for the [*] Bonds
 
4. No Payments or Enforcement. Until the Senior Debt is Discharged, the Subordinated Creditor will not demand or receive from the Credit Parties, and the Credit Parties will not pay to the Subordinated Creditor, all or any part of the Subordinated Debt, by way of payment, prepayment, setoff, lawsuit or otherwise, nor will the Subordinated Creditor exercise any remedy with respect to any of the Existing Liens against any assets or property of the Credit Parties, nor will the Subordinated Creditor commence, or cause to commence, prosecute or participate in any administrative, legal or equitable action against the Credit Parties.
 
	 
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5. Subordination Upon Any Distribution of Assets of the Credit Parties. In the event of any payment or distribution of assets of the Credit Parties of any kind or character, whether in cash, property, or securities, upon the dissolution, winding up, or total or partial liquidation or reorganization, readjustment, arrangement, or similar proceeding relating to the Credit Parties or its property, whether voluntary or involuntary, or in bankruptcy, insolvency, receivership, arrangement, or similar proceedings or upon an assignment for the benefit of creditors, or upon any other marshaling or composition of the assets and liabilities of the Credit Parties, or otherwise (such events, collectively, the “Insolvency Events”): 
 
i. all amounts owing on account of the Senior Debt shall first be paid in full and in cash, or payment provided for in cash or in cash equivalents, before any payment or distribution is made on account of the Subordinated Debt; and
 
ii. to the extent permitted by applicable law, any payments or distributions on account of the Subordinated Debt to which the Subordinated Creditor would be entitled except for the provisions hereof, shall be paid or delivered by the trustee in bankruptcy, receiver, assignee for the benefit of creditors, or other liquidating agent making such payment or distribution directly to [*] for application to the payment of the Senior Debt in accordance with clause (i), after giving effect to any concurrent payment or distribution or provision therefor to [*] in respect of such Senior Debt.
 
6. Payment Over to Senior Lender. In the event that any payments or distributions on account of the Subordinated Debt or in any way relating to the Collateral or any assets or property of the Credit Parties shall be received in contravention of this Agreement by the Subordinated Creditor before all Senior Debt is Discharged, such payments or distributions shall be immediately paid over or delivered to [*], in the same form as received, with any necessary endorsements, for application to the payment of the Senior Debt remaining unpaid, after giving effect to any concurrent payments or distributions to [*] in respect of the Senior Debt.
 
7. Release of Collateral Upon Permitted Collateral Sale. In connection with any sale, lease, exchange, transfer or other disposition of Collateral or any other assets of the Credit Parties by [*], the Subordinated Creditor hereby agrees: (i) that upon the written request of [*] with respect to the Collateral or other assets subject to such sale or other disposition (which written request shall specify the proposed closing date), release or otherwise terminate any Existing Liens on such Collateral or other assets; (ii) to promptly deliver such terminations of financing statements, partial lien releases, mortgage satisfactions and discharges, endorsements, assignments or other instruments of transfer, termination or release (collectively, “Release Documents”) and take such further actions as [*] shall reasonably require in order to release and/or terminate the Existing Liens or any other claims that the Subordinated Creditor may have on the Collateral or any other assets of the Credit Parties subject to such sale or other disposition; provided that no such Release Documents shall be filed or become effective until the closing of such sale or other disposition; and (iii) shall be deemed to have consented under the documents evidencing the Existing Obligations to such sale or disposition free and clear of such Existing Liens or other claims or security interests the Subordinated Creditor may have and to have waived the provisions of the documents evidencing the Existing Obligations to the extent necessary to permit such transaction.
 
	 
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8. Authorization to Senior Lender. If, while any Subordinated Debt is outstanding, any Insolvency Event shall occur and be continuing with respect to any of the Credit Parties or its property that constitutes a default or Default Event under the Bond Subscription Contract: (i) [*] is hereby irrevocably authorized and empowered (in the name of the Subordinated Creditor or otherwise), to demand, sue for, collect, and receive every payment or distribution in respect of the Subordinated Debt on the terms and conditions provided herein and give acquittance therefor and to file claims and proofs of claim and take such other actions (including voting the Subordinated Debt) as it may deem necessary or advisable for the exercise or enforcement of any of the rights or interests of [*] hereunder (but in no event shall [*] have any obligation to take any such actions); and (ii) the Subordinated Creditor shall promptly take such action as [*] reasonably may request to effectuate the provisions of this Agreement: (A) to collect the Subordinated Debt for the account of [*] and to file appropriate claims or proofs of claim in respect of the Subordinated Debt; (B) to execute and deliver to [*] such powers of attorney, assignments, and other instruments as it may request to enable it to enforce any and all claims with respect to the Subordinated Debt consistent with the terms of this Agreement; and (C) to collect and receive any and all payments and distributions on account of the Subordinated Debt as provided herein until the Senior Debt is Discharged.
 
9. Power of Attorney. The Subordinated Creditor hereby irrevocably constitutes and appoints [*], and any agent or representative of [*], with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of the Subordinated Creditor and in the name of Subordinated Creditor or in [*]’s own name, from time to time in [*]’s discretion, for the purpose of carrying out the terms of this Agreement, to take any and all action and to execute any and all documents and instruments, in each case, which may be necessary or commercially reasonable and appropriate to accomplish the purposes of this Agreement, including any Release Documents, such power of attorney being coupled with an interest and irrevocable. The Subordinated Creditor hereby ratifies all that said attorneys shall lawfully do or cause to be done pursuant to the power of attorney granted in this Section. No Person to whom this power of attorney is presented, as authority for [*] to take any action or actions contemplated hereby, shall be required to inquire into or seek confirmation from the Subordinated Creditor as to the authority of [*] to take any action described herein, or as to the existence of or fulfillment of any condition to this power of attorney, which is intended to grant to [*] the authority to take and perform the actions contemplated herein.
 
10. Certain Agreements of the Subordinated Creditor.
 
(a) No Benefits. The Subordinated Creditor understands that there are various agreements between [*] and the Credit Parties evidencing and governing the Senior Debt, and the Subordinated Creditor acknowledge and agree that such agreements are not intended to confer any benefits on the Subordinated Creditor, and that [*] shall not have any obligation to the Subordinated Creditor, or any other parties, to exercise any rights, enforce any remedies, or take any actions which may be available to them under such agreements.
 
	 
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(b) No Interference. The Subordinated Creditor acknowledges that Credit Parties have granted to [*] security interests in all of the Collateral, and agrees not to interfere with or in any manner oppose a disposition of any Collateral by [*] in accordance with applicable law and the terms of the Bond Subscription Contract.
 
(c) Reliance by Senior Lender. The Subordinated Creditor acknowledge and agree that [*] has relied upon and will continue to rely upon the subordination provisions provided for herein and the other provisions hereof in consenting to any loans or other financial accommodations by the Subordinated Creditor to the Credit Parties.
 
(d) Obligations of Credit Parties Not Affected. The Subordinated Creditor hereby agrees that at any time and from time to time, without notice to or the consent of the Subordinated Creditor, without incurring any responsibility or obligation to the Subordinated Creditor, and without impairing or releasing the subordination provided for herein or otherwise impairing the rights of [*] hereunder: (i) the time for Credit Parties’ performance of or compliance with any of its agreements contained in the Bond Subscription Contract may be extended or such performance or compliance may be waived by [*]; (ii) the agreements of Credit Parties under the Bond Subscription Contract may from time to time be modified by [*] and Credit Parties for the purpose of adding any requirements thereto or changing in any manner the rights and obligations of the respective parties thereunder; (iii) the manner, place, or terms for payment of the Senior Debt or any portion thereof may be altered or the terms for payment extended, or the Senior Debt may be renewed in whole or in part, all in accordance with the terms of the Bond Subscription Contract; (iv) the maturity of the Senior Debt may be accelerated in accordance with the terms of any present or future agreement between the Credit Parties and [*]; (v) any Collateral may be sold, exchanged, released, or substituted and any of [*]’s Security Interests may be terminated, subordinated, or fail to be perfected or become unperfected; (vi) any guarantor or obligor or other person liable in any manner for Senior Debt may be discharged, released, or substituted; and (vii) all other rights against the Credit Parties , any other party, or with respect to any Collateral, may be exercised by [*] (or [*] may waive or refrain from exercising such rights).
 
(e) Rights of Senior Lender Not to Be Impaired. No right of [*] to enforce the subordination provided for herein or to exercise its other rights hereunder shall at any time in any way be prejudiced or impaired by any act or failure to act by the Credit Parties or [*] hereunder or under or in connection with the Bond Subscription Contract, or by any noncompliance by the Credit Parties with the terms and provisions and covenants herein, in the Bond Subscription Contract, regardless of any knowledge thereof [*] may have or otherwise be charged with.
 
(f) Financial Condition of the Credit Parties. The Subordinated Creditor shall not have any right to require [*] to obtain or disclose any information with respect to: (i) the financial condition or assets or liabilities of the Credit Parties, or the ability of the Credit Parties to pay the Senior Debt, or perform their respective obligations under the Bond Subscription Contract; (ii) the Senior Debt; (iii) the Collateral or other security for any or all of the Senior Debt; (iv) the existence or nonexistence of any guarantees of, or any other subordination agreements with respect to, all or any part of the Senior Debt; (v) any action or inaction on the part of [*] or any other party; or (vi) any other matter, fact, or occurrence whatsoever, except that [*] agrees to provide written notice of any default or Default Event by Credit Parties under the Bond Subscription Contract, provided, however, that no rights or benefits conferred upon [*] by this Agreement or under the Bond Subscription Contract shall be impaired or adversely affected by any failure of [*] to provide such notice.
 
	 
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11. Restrictions on Transferability of Subordinated Debt. The Subordinated Creditor agrees that it shall not transfer, assign, encumber, hypothecate or subordinate, at any time while this Agreement remains in effect, any right, claim or interest of any kind in or to any of the Subordinated Debt, either principal or interest or otherwise, and there shall promptly be placed on each promissory note or other document or agreement constituting a portion of the Subordinated Debt, a legend reciting that the same is subject to this Agreement; provided, however, the Subordinated Creditor shall have the right to transfer or assign the Subordinated Debt, or any portion thereof, so long as a condition precedent to such transfer or assignment, the transferee or assignee shall execute and deliver to [*] a subordination agreement substantially in the same form as this Agreement with respect to such transferred portion of the Subordinated Debt.
 
12. Statement of Account. The Subordinated Creditor hereby agrees that it will provide and deliver to [*], upon demand, from time to time, a statement of the account of Credit Parties with the Subordinated Creditor.
 
13. Miscellaneous.
 
(a) Subrogation. The Subordinated Creditor hereby agree that until the Senior Debt is Discharged, it shall waive any claims and shall not exercise any right or remedy, direct or indirect, arising by way of subrogation or otherwise, against the Credit Parties .
 
(b) Continuing Agreement. This Agreement is a continuing agreement of subordination and shall continue in effect and be binding upon the Credit Parties and the Subordinated Creditor until the Senior Debt is Discharged, or until the Subordinated Debt is paid in full in accordance with the provisions of this Agreement. The subordinations, agreements, and priorities set forth herein shall remain in full force and effect regardless of whether any party hereto in the future seeks to rescind, amend, terminate, or reform, by litigation or otherwise, its respective agreements with the Credit Parties.
 
(c) Reinstatement. This Agreement shall continue to be effective or shall be reinstated, as the case may be, if, for any reason, any payment of the Senior Debt by or on behalf of the Credit Parties shall be rescinded or must otherwise be restored or returned by [*], whether as a result of an Insolvency Event or otherwise.
 
(d) Obligations of the Credit Parties Not Affected. The provisions of this Agreement are intended solely for the purpose of defining the relative rights of the Subordinated Creditor, on the one hand, and of [*], on the other hand, with respect to the obligations of the Credit Parties to [*] and the Subordinated Creditor. Nothing contained in this Agreement shall: (i) impair, as between the Subordinated Creditor and the Credit Parties, the obligation of the Credit Parties to pay their respective obligations with respect to the Subordinated Debt as and when the same shall become due and payable (subject, however, to the terms of this Agreement as applicable to [*]’s rights hereunder); or (ii) otherwise affect the relative rights of the Subordinated Creditor against the Credit Parties, on the one hand, and of the other creditors (other than [*]) of the Credit Parties against the Credit Parties, on the other hand.
 
	 
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(e) Further Assurances and Additional Acts. The Subordinated Creditor shall execute, acknowledge, deliver, file, notarize, and register at its own expense all such further agreements, instruments, certificates, financing statements, documents, and assurances, and perform such acts as [*] reasonably shall deem necessary to effectuate the purposes of this Agreement, and promptly provide [*] with evidence of the foregoing reasonably satisfactory to [*].
 
(f) Entire Agreement. This Agreement: (i) is valid, binding and enforceable against the Subordinated Creditor and Credit Parties in accordance with its terms and provisions and no conditions exist as to its legal effectiveness; and (ii) constitutes the entire agreement between the parties with respect to the subject matter hereof. No promises, either expressed or implied, exist between [*], the Subordinated Creditor and Credit Parties, unless contained herein. This Agreement is the result of negotiations between the Subordinated Creditor, Credit Parties and [*] and has been reviewed (or have had the opportunity to be reviewed) by counsel to all such parties, and is the product of all parties. 
 
(g) Amendments; Waivers. No delay on the part of [*] in the exercise of any right, power or remedy shall operate as a waiver thereof, nor shall any single or partial exercise by [*] of any right, power or remedy preclude other or further exercise thereof, or the exercise of any other right, power or remedy. No amendment, modification or waiver of, or consent with respect to, any provision of this Agreement shall in any event be effective unless the same shall be in writing and acknowledged by [*], and then any such amendment, modification, waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. The rights and remedies of [*] under this Agreement are cumulative and not exclusive of any rights, remedies, powers, and privileges that may otherwise be available to [*] provided by law.
 
(h) Mandatory Forum Selection. The courts of first instance (rechtbank) of Amsterdam, the Netherlands have exclusive jurisdiction to settle any dispute arising out of or in connection with this Agreement (including a dispute relating to the existence, validity or termination of this Agreement or the consequences of its nullity or any non-contractual obligations arising out of or in connection with this Agreement).
 
(i) Governing Law. This Agreement and any non-contractual obligations arising out of or in connection with it are governed by and shall be interpreted in accordance with Dutch law. 
 
(j) Notices. All notices of request, demand and other communications hereunder shall be addressed to the parties as follows:
  
	 
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If to the Credit Parties: One World Trade Center, Suite 8500
 
New York, NY 10007
Attn: Vincent Browne
Telephone: +1 913-815-1557
E-Mail: vb@alternusenergy.com 
 
If to [*]: [*] 
 
If to Subordinated Creditors: 
 
Creditors: InMost Partners LLC and IDC DR Fund LP
1500 Broadway, Suite 704, New York, NY 10036
Attn: Eliot Kang
Telephone: +1 917-952-8288
E-Mail: eliot@inmostpartners.com
 
unless the address is changed by the party by like notice given to the other parties. Notice shall be in writing and shall be deemed delivered: (i) if mailed by certified mail, return receipt requested, postage prepaid and properly addressed to the address below, then three (3) business days after deposit of same in a regularly maintained U.S. Mail receptacle; or (ii) if mailed by Federal Express, UPS or other nationally recognized overnight courier service, next business morning delivery, then one (1) business day after deposit of same in a regularly maintained receptacle of such overnight courier; or (iii) if hand delivered, then upon hand delivery thereof to the address indicated on or prior to 5:00 p.m., EST, on a business day. Any notice hand delivered after 5:00 p.m., EST, shall be deemed delivered on the following business day. Notwithstanding the foregoing, notice, consents, waivers or other communications referred to in this Agreement may be sent by e-mail, or other method of delivery, but shall be deemed to have been delivered only when the sending party has confirmed (by reply e-mail or some other form of written confirmation from the receiving party) that the notice has been received by the other party.
 
(k) Binding Effect. This Agreement shall become effective upon execution by the parties hereto and shall be binding on the parties hereto and their respective successors and assigns.
 
(l) Enforceability. Wherever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by, unenforceable or invalid under any jurisdiction, such provision shall as to such jurisdiction, be severable and be ineffective to the extent of such prohibition or invalidity, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.
 
(m) Counterparts; Electronic Signatures. This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts and each such counterpart shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Agreement. Receipt of an executed signature page to this Agreement by electronic transmission shall constitute effective delivery thereof. Electronic records of this Agreement maintained by [*] shall be deemed to be originals thereof for all purposes.
 
	 
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(n) Costs, Fees and Expenses. Borrower shall pay or reimburse [*] for all reasonable costs, fees and expenses incurred by [*] or for which [*] becomes obligated in connection with the enforcement of this Agreement, including costs and expenses and attorneys’ fees, costs and time charges of counsel to [*] throughout all court levels.
 
(o) Termination. This Agreement shall not terminate until the Senior Debt is Discharged, or until the Subordinated Debt is paid in full in accordance with the provisions hereof.
 
(p) Specific Performance. To the extent possible under applicable law, [*] is hereby authorized to demand specific performance of this Agreement, whether or not the Credit Parties shall have complied with any of the provisions hereof applicable to them, at any time when the Subordinated Creditor shall have failed to comply with any of the provisions of this Agreement applicable to it. To the extent possible under applicable law, the Subordinated Creditor hereby irrevocably waive any defense based on the adequacy of a remedy at law, which might be asserted as a bar to such remedy of specific performance.
 
(q) Authority. Each party hereby represents and warrants to the others that each party has the requisite power and authority to enter into this Agreement and otherwise to carry out its respective obligations hereunder, and that the execution, delivery and performance by each party of this Agreement have been duly authorized by all necessary action on the part of each party, respectively and as applicable, and that the person executing this Agreement on behalf of each party has been fully authorized to do so in accordance with applicable law and the governing documents of each party.
 
[Signatures on the following page]
 
	 
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IN WITNESS WHEREOF, the undersigned have executed this Subordination Agreement as of the date first written above.
 
Power Clouds Europe B.V.
 
By: ______________________________
Name: Vincent Browne
Title: Director
 
PC-Italia-02 S.p.A.
 
By: ______________________________
Name: Vincent Browne
Title: Director
 
[*] 
 
By: ______________________________
Name: 
Title: President
 
InMost Partners LLC
 
By: ______________________________
Name: Eliot S. Kang
Title: CEO/Managing Member
 
IDC DR FUND LP 
 
By: ______________________________
Name: Eliot S. Kang
Title: General Partner
 
Subordination Agreement – Signature Page
 
	 
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