EFTA Document EFTA01366511

Amendment Page 82 of 868 Labor disputes and the labor laws could have a material adverse effect on the operation and financial penbtmance of South AfrIcart projects. Although there is a hstiry Cl positive and castructwe engagement with tato( weans in South Al nca in recent years there have been periods ounng which the various Stakeh0lders are unatik to agree on depute resolution processes 'eating in significant Sag disputes and diduarre labor aetivereS Although we expect to contract with thniparties for the operation and maintenance of our Smell African cocoas and not hoe local employees for such projects, any such project will nonetheless be at risk of its operations being disrupted for indefnte periods We to labor strikes and We' labor deputes related to tie pates from whom we contract operating and maintenance services Sonfcart labor clempaceri may have a material adverse effect on the operators and manna results and ocirciton or our South African projects The *positing results of our energy prefects In China may be adverselyaffected by changes In governmental policies that currently subsidize removable The Chinese government has enacted a series at financial menthes designed to promote the development of solar and wind exceeds Most importantly. the feed-in land program currently provides that solar projects are eligible to raceme increased tariffs in an amour( in excess ci the benchmark tariff received by local desulfurized coal- fired generating unts The amount of the tariff to to pad to the project is established by the government based on a number of factors trot aro designed to make the project economically vial:* The operating results of a reelect would be adversely affected in the event the government reduced the tariff payable to one or nue of our projects There can be ro assurance that the Chinese government will rot elect to reduce or eliminate the ongoing lane payments to our renewable energy projects in China Rasuant to the Chinese governments Renewable Energy Law, all electrical power generated from dean and renewable energy sources is required to be purchased by the grid company provided tat on-grid technical standards have been complied with and required approvals have teen cOtained. Nevertheless, soar and wind projects have periodically menenced periods of curtarlment by the grid company due to a lack Cl of restructure and transmssion capacsty. Curtadmere results in reduced tariff payments to the project as the project is only entitled to receive payment for energy delivered to the grid companee Our projects in China may experience periodic reductions in revenue due to curtalrreas atvibutable to fin tons on the electricity grids served by these projects Chinese solar and wind projects typically enter into a 'framework' FAA with a power god company with an irklial term typcally ranging from three to five years These framework FPAs do not necessarily speoty any volume or poop obligators of me part of the make Puraiaser The Soar and wad Mite* at the power grid company will further enter into atom-term agreements under the framework PPA, when are subject to automate annual renewals The terms of these annual supperrental agreements are siteect to change to the extent rate gwernment changes its tariff rate M a result our projects in Chne MI likely not have any long-tarn contractuel protection on to price at which they may sell the power they generate An hcugh Chna haS ex:leafed an intention to keep Me subsidized land rates in effect for the foreseeable future, n is under nO obligation to do so and therefore the aortas* of solar and wind projects in China is sheet to flange with little or no advance notice Changes In foreign withholding taxes could adversely affect wrangle of operationa We amenity conduct our operatons in China. Brazil, Inca,. South Africa. Honduras. Costa Rica. Ncaragua, Peru. Uruguay. Malaysia and Thailand and expect in to future to expand our business into other foreign counties Currently rastnbubcns of earnings and other payments, ncludng interest, to us from our projects may be aroject to wittoldng taxes imposed by the prediction n whits the project entries are formed a operating 74 http://cfdocs.btogo.com:27638/cf/drv7/pub/edgar/2015/07/20/0001193125-15-256461/d78... 7/20/2015 CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0058039 CONFIDENTIAL SONY GM_00204223 EFTA01366511