Areia Branca Hydroelectric Project

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In September 2006, Econergy International Plc. [USA] entered into an agreement with HydroPartners, LLC to invest in Hidreletrica Areia Branca, a 19 MW Hydroelectric facility in Minas Gerais. The license to built and operate the power plant was initially granted to HP1 do Brasil Ltda in May 2000, with a 30-year duration (subject to extension pending negotiations between the parties). In 2006, the license was transferred to Hidreletrica Areia Branca S.A., a partnership of Econergy International Plc. [USA] and HydroPartners, LLC. In December 2008, when the project company was a wholly-owned subsidary of Ecoenergy, Suez GDF, a subsidiary of Suez [France] acquired Econergy International Plc and all its subsidiaries. The project benefitted from its participation in Proinfa. Proinfa was a program designed to stimulate alternative energy projects. Under the program, the federal power utility Eletrobras contracted for a 20-year period the electricity production of alternative projects to provide sustainable development of the sector. The total project cost was estimated to be US $48 million. In January 2008, Econergy's subsidiary, Hidreletrica Areia Branca, signed a construction and non recourse long-term take-out loan agreement for the project with Brazil's Banco Nacional de Desenvolvimento Economico e Social (BNDES) for R$55.6 MM (US $31.8 million) or 66.4% of total project cost. The loan had A term of 14 years, post an initial grace period on payment of interest and principal during construction and 6 months after commercial operation and an interest rate of TJLP (Taxa de Juros de Longo Prazo, the long-term interest rate in Brazil) plus 2.5%, an overall interest rate of 8.75%. Econergy International was to provide an unsecured guarantee for the full amount of the loan during the construction period. After commercial operation Econergy was to provide annual payment support until stated debts ervice coverage ratios were met at which time the loan will become fully non-recourse to the Company for the remainder of its term. In March 2010, the power plant began to operate. Will become operational 1Q 2009.