EFTA01366586.pdf

Amendment #4 Page 157 of 868 Were Ip eb,Man, Components of results of operations Revenue A significare matronly 04 ors revenues are obtained through the sale et energy pursuant to terms of PPAs or other contractual arrangements which have a weighted average (based on megawatts) remaining life of 19 years as of March 31. 2015 PPM are accouled for as operating leaseswith ro mnimum lease payment Revenue is recorded as income wnen ire electricity is delivered incerinves We anticipate recemng performance.based incentores. or "RBIs; from governmental agencies in connection with certain sponsored pogroms PEI revenue is generally based on Ite actual level of output generated Ervin our solar energy systems recognized upon vallaton of the kilowatt-hours produced from a third-party metering company We intend to regotete and expect to receive upfront inceMwes or subsidies from various governmental amschcbcns for operating certain of our solar energy systems Wen amounts are deferred. they will be recognized as revenue on a straight-line bass over the estimated useful We of the solar energy system We* d ter propels included in our initial portfolio has received any Pl9la or otter upfront incertwes or tubules del would be classified as intertive revenue in our cornlyned statemerts et operations Operating costs and expenses Cost or cpaarpons Ceti of operations * =roused of operations ant rubi rtenance expenses incurred in order to operate cur solar power generation assets. as wee as property and otter taxes, property insurance, land leases, rental expense and other licenses Cost of operators—afIlletes represents operation and maintenance services provided under feel pnoe agreenorts with affiliates of the Sponsor. which may include annual price increases. Cost of operatons—affeates also includes protect-level management adinnstraton agreements. Deprecation and accretion Deprecation expense is recognized using the straight4ne mettod over the estimated useful lives of our solar power gene alron assets Accretion expense represents the increase in asset retirement oblgasons over the remaining operational Ire of the at/Rooted solar power generation assets Genera( arid admin.'s:reeve Our general and adrrinstrabve expenses consist primarily of the accalon of general corporate overhead costs from our Sponsor that are Saturable to our predecessor operations, 'affiliate expenses' These costs include legal, accounting, tax, treasury, ff nfrastruclue insurance, employee benefit costs communcatons, human mottoes and procurement Upon completion of this offering, we anticipate our general and administrative expense to be comprised ol mu managerreni fee we will pay to our Sponsor for Pie rrenagerrert and adrnristraton services I:sealed to is under the Management Services Agreement aryl all oasts of acing business See 'Certain relationships and related party Uansaclions—Management Services Agreement Interest expense Interest expense is comprised of interest incurred udder our variable rale framing arrangements and the arnorteabon of deferred financing costs incurred in connection with obtaining =newton and term financing, net of arnaunts capdalLred and ircluded in property and equilxnent. net 149 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-0058114 CONFIDENTIAL SDNY GM_00204298 EFTA01366586