Solar Alliance Strategic Investor Increases Shareholding and Commits to Funding Future Growth

Solar Alliance Energy Inc. has announced that it has signed a comprehensive agreement with Mr. Tom Anderson to increase his ownership stake in the Company to approximately 50% through the conversion of debt, interest projected to December 31, 2018 and a further loan of US$300,000 totaling US$2,753,973 into shares. The conversion of debt and the additional funding from Mr. Anderson are a strong indication of support for Solar Alliance's long-term business plan in the U.S. solar industry and aligns the Company with a high net worth individual committed to Solar Alliance's long-term success. Mr. Anderson is a private investor and entrepreneur with extensive experience, inter alia, in the Leisure & Entertainment, Oil and Gas, Bioscience, Industrial Tools Software and Healthcare businesses. The Company is seeking approval from its disinterested shareholders at its annual general and special meeting called for December 21, 2018 to approve this change of control.

The investment by Mr. Anderson will support the Company's growth plan in commercial solar and the rollout of the SunBox residential program. SunBox is a standard solar system consisting of two sizes that include battery storage or an optional generator for whole home backup. Solar Alliance is selectively partnering with architects, developers and homebuilders that will integrate this cost-effective solar offering into their existing home designs. The SunBox program is in addition to growth in the Company's commercial solar division which has put Solar Alliance on the path to record a ten-fold year over year increase, by kilowatt (kW), of installed commercial solar projects. 

The Company has reached an agreement with Mr. Anderson to increase his shareholdings in the Company through the conversion of the Notes and Loan with accrued interest to the date of settlement at a price of $0.03 per share. As an additional consideration, the lender will be paid 100% of the net proceeds of funds being held in escrow for the ultimate benefit of the Company (the "Escrow Funds"). The Escrow Funds are from the 2008 sale of the Company's Ghost Pine Wind Project. The Company believes the conditions for release from escrow have been met and the Company has a court date in January 2019 to seek an order to release the funds plus interest less allowable deductible costs. In exchange for agreeing to the conversion of the Notes and Loan the Company has agreed to pay the lender 100% of the Escrow Funds ultimately received by the Company. The conversion at $0.03 would result in Mr. Anderson owning more than 20% of the shares of the Company and the Company is seeking approval from its disinterested shareholders at its annual general and special meeting called for December 21, 2018 to approve this change of control. Mr. Anderson currently owns 6,241,666 shares (6.48%) and 4,666,666 share purchase warrants exercisable at $0.18 until July 6, 2020. By illustration, if the Note and Loan are converted, with interest projected to December 31, 2018, Mr. Anderson would be owed an aggregate $2,753,479 which if converted at $0.03 would result in the issue of 91,782,648 shares to bring his total shareholding to 52.1% without considering any further share issues.

In addition, the Company has reached an agreement with certain related parties to fully settle an aggregate of up to US$423,931 of unpaid fees and advances, bearing interest at the rate of 15% per annum from the date the fees became due for payment, and/or the advances were received. Assuming settlement is on the same basis of $0.03 per share to be issued on December 31, 2018, this would result in the issue of an aggregate 14,131,033 shares. In this case Mr. Anderson's holding would be approximately 48.5%.

The terms of the Notes and Loan conversion and settlement of the related party debt is subject to receipt of regulatory approval. The pricing of the debt conversion is in reliance on the temporary relief measures established by the Exchange and requires the approval of the Exchange having regard to the temporary relief criteria set out in the exchange's bulletin of April 7, 2014.