SolarBank Corp. (NASDAQ: SUUN) (Cboe CA: SUNN) (FSE: GY2) Announces $100 Million Project Financing from CIM Group for U.S. Solar Expansion

• SolarBank and CIM Group have announced a US$100 million financing deal for a portfolio of U.S. solar energy projects totaling 97 MW.
• The deal is structured as a preferred equity investment at the project level, preserving SolarBank’s share capital, with CIM receiving a 3% annual coupon and retaining full ownership of transferred investment tax credits.
• SolarBank expects to maintain majority ownership of the 21-project portfolio post-financing, supporting SolarBank’s shift toward becoming a long-term solar asset owner in the U.S.

Disseminated on behalf of SolarBank Corporation

SolarBank (NASDAQ: SUUN) (Cboe CA: SUNN) (FSE: GY2), a premier developer and owner of renewable and clean energy projects, specializing in distributed and community solar initiatives throughout Canada and the U.S., has announced a US$100 million project-based financing with infrastructure investor CIM Group to fund a 97 MW portfolio of solar energy projects in the United States. The deal marks a significant step in SolarBank’s evolution from solar developer to long-term asset owner, offering equity-style exposure to U.S. renewable energy growth without issuing new shares (https://ibn.fm/J7XIZ).

The financing will be structured as a preferred equity investment by CIM into a newly formed entity, New HoldCo. That entity will operate as a joint venture between CIM and Abundant Solar Power (“ASP”), a wholly owned subsidiary of SolarBank.

The 97 MW portfolio includes 21 solar projects located across the U.S., all currently under development by ASP. The projects will be transferred to New HoldCo in stages, with CIM providing 20% of the purchase price at mechanical completion and the remaining 80% at substantial completion. This structure allows the company to raise capital at the project level while preserving shareholder value.

CIM’s preferred equity interest will come with a 3% annual coupon, payable semi-annually. In addition to the coupon, CIM will retain 100% of the revenue from the sale of investment tax credits (“ITCs”), which will be transferred under Section 6418 of the Internal Revenue Code to third-party buyers.

SolarBank will receive the remaining project-level cashflows after CIM’s distributions. In the event of a liquidation or casualty event, proceeds will be distributed in proportion to each party’s contributions.

The agreement also includes a future redemption mechanism. New HoldCo may redeem CIM’s equity interest starting 180 days after the fifth anniversary of the last project going into service. The redemption price would be the greater of fair market value or a defined multiple of invested capital. If SolarBank chooses not to exercise this option, CIM retains the right to force a redemption at the lower of those two metrics.

CIM Group, based in Los Angeles, has long invested in infrastructure and real estate aimed at community and environmental impact. “This transaction with SolarBank to grow its portfolio of solar projects underscores our ongoing commitment to the renewable energy sector and our focus on supporting innovative companies leading the energy transition across North America,” said Kyle Hatzes, Managing Director of Infrastructure and Impact Investments at CIM Group.

For SolarBank, the deal helps accelerate its long-term strategy to become a long-term solar asset owner and power producer. The company is currently managing a solar development pipeline exceeding 1 gigawatt, with approximately 25 MWp of solar and 60 MWh of storage under construction, and another 149 MWp in late-stage development.

“The financing is another major milestone in SolarBank’s plans to grow its status as an independent power producer. Assuming full funding, SolarBank will retain a majority ownership interest in what is expected to be 21 solar energy projects with a total capacity of 97 MW,” said Dr. Richard Lu, President and CEO of SolarBank. “The transaction has been structured such that SolarBank does not have to issue any new shares, as the financing is being completed at the project company level.”

For more information, visit the company’s website at SolarBankCorp.com.

This report contains forward looking information. Please refer to the press release entitled “US$100 Million Transformative, Project Financing Announced by SolarBank and CIM Group to Fund 97 MW of Renewable Energy Assets in the United States” for additional details on the statements, risks and assumptions.  There are several risks associated with the transaction and development of the projects. The development of any project is subject to receipt of interconnection approval, receipt of a community solar contract, required permits, the continued availability of third-party financing arrangements for the Company and the risks associated with the construction of a solar power project. In addition, governments may revise, reduce or eliminate incentives. The transaction is subject to the execution of definitive documentation. SolarBank will also need to secure the financing required to develop the projects to mechanical completion and substantial completion, as prior to such milestone none of the funding from the transaction will be available.

NOTE TO INVESTORS: The latest news and updates relating to SUUN are available in the company’s newsroom at https://ibn.fm/SUUN

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