Polaris Infrastructure Inc. Announces Acquisition Transaction in the Dominican Republic

TORONTO, ON / ACCESSWIRE / April 20, 2022 / (All amounts in US dollars unless otherwise stated) - Polaris Infrastructure Inc. (TSX:PIF) ("Polaris" or the "Company"), announced today that it has signed a Share Purchase Agreement ("SPA") for an operational solar energy project in the Dominican Republic.

The Dominican Republic - Solar

Polaris signed the SPA with a Canadian-based renewable energy developer, Potentia Renewables Inc., to acquire a 32.0 MWdc⁽¹⁾ operational solar project named Canoa 1 (the "Project") located in the Barahona Province, Dominican Republic. The Project reached COD in March 2020 and has a 20-year power purchase agreement ("PPA") in place with Edesur Dominicana SA (EDESUR), a local Dominican distributor.

The key terms and attributes of the acquisition are as follows:

• Polaris agreed to purchase all of the issued and outstanding common shares of Emerald Solar Energy SRL which owns 100% of the Project and the licenses and permits, in exchange for $18.4 million in cash at closing;
• Such purchase price is subject to customary working capital changes from signing of the SPA until closing;
• Polaris will own 100% of the Project, which includes the Canoa 2 expansion as described below;
• Polaris will assume non-recourse debt at the project level of approximately $35.0 million;
• The Project has a PPA denominated in US dollars with an estimated price for 2022 of $128.10 per Mwhr. Such PPA has an inflator of 1.22% per annum until the price reaches $142.80 per Mwhr at which point the price remains fixed until the end of the PPA in 2040;
• The closing of the acquisition is subject to customary conditions including approval of the share transfer by appropriate local ministries and the project lender. Such closing is anticipated to take place within 90 days.

The Project has an extendable 30-year lease agreement with the original developer and is located on a portion of a land parcel totaling approximately 1.4 square kilometers. The Canoa 1 project represents approximately 30% of the total land parcel. The definitive concession allows for the capacity installed to be doubled from the current operating capacity of 32.6 MWdc⁽¹⁾ to approximately 65.0 MWdc⁽¹⁾.

A second PPA for Canoa 2 with the local distributor would be required and these discussions are underway. To the extent a PPA for Canoa 2 is reached, Polaris will look to commence construction shortly thereafter.

"We are very pleased to have signed this acquisition" stated Marc Murnaghan, Chief Executive Officer of Polaris, "The combination of operational and development assets is the mix of assets we have been looking for and aligns with our strategic objectives. Once the acquisition is closed, our jurisdictions will increase to five and our plants in operation will increase to six, with solar added to the generation mix. This is all aligned with the goal of diversification by asset class and generation mix while maintaining 100% of revenues derived in US dollars. In addition, we view the Dominican Republic as a very attractive market for Polaris to grow and develop further renewable projects."

Polaris plans to fund the acquisition with cash on hand.

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1. MWdr refers to megawatt direct current.

About Polaris Infrastructure Inc.

Polaris Infrastructure Inc. is a Toronto-based company engaged in the operation, acquisition and development of renewable energy projects in Latin America. Currently, the Company owns and operates a geothermal project located in Nicaragua, three hydro projects located in Peru and a solar project in Panama, currently under construction.

Investor Relations
Polaris Infrastructure Inc.
Phone: +1 647-245-7199
Email: info@polarisinfrastructure.com

This press release contains certain "forward-looking information" which may include, but is not limited to, statements with respect to future events or future performance, management's expectations regarding the ability to complete the acquisition of the Projects on the terms described in this press release or at all, the anticipated MWdr of the Projects, the anticipated investments required to complete construction of the Project, the anticipated timeline required to achieve commercial operation, the ability to fund construction with cash on hand and funds generated through operations, the expected benefits from the acquisition of the Project and diversification into the Dominican Republic and the availability of similar acquisition opportunities in the Dominican Republic. Such forward-looking information reflects management's current beliefs and is based on information currently available to management. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "predicts", "intends", "targets", "aims", "anticipates" or "believes" or variations (including negative variations) of such words and phrases or may be identified by statements to the effect that certain actions "may", "could", "should", "would", "might" or "will" be taken, occur or be achieved. A number of known and unknown risks, uncertainties and other factors may cause the actual results or performance to materially differ from any future results or performance expressed or implied by the forward-looking information. Such factors include, among others, general business, economic, competitive, political and social uncertainties; the actual results of current renewable energy production, development and/or exploration activities and the accuracy of probability simulations prepared to predict prospective renewable energy resources; changes in project parameters as plans continue to be refined; possible variations of production rates; failure of plant, equipment or processes to operate as anticipated; accidents, labor disputes and other risks of the renewable energy industries; political instability or insurrection or war; labor force availability and turnover; delays in obtaining governmental approvals or in the completion of development or construction activities, or in the commencement of operations; the ability of the Company to continue as a going concern and general economic conditions, as well as those factors discussed in the section entitled "Risk Factors" in the Company's Annual Information Form. These factors should be considered carefully and readers of this press release should not place undue reliance on forward-looking information.

Although the forward-looking information contained in this press release is based upon what management believes to be reasonable assumptions, there can be no assurance that such forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. The information in this press release, including such forward-looking information, is made as of the date of this press release and, other than as required by applicable securities laws, Polaris assumes no obligation to update or revise such information to reflect new events or circumstances.

SOURCE: Polaris Infrastructure, Inc.