EFTA01367008.pdf

Amendment #4 Page 579 of 868 lithe (Within, Tre Combined Entity marJy reties on the cash provided try operatng actrotes bank loans and adkarces horn related parties toIname its nvesting activities and working capital reqsrernents in pa:Soutar. he anode due to related parties in the arrost of US5180,765 as of December 31, 2014 is due on demand and USS41,514 of bank loan will mature in July 2015 Horton Energy Caymans Linseed CHECI:). IM shareholder or the Conlaned Ertly, has provided a leiter of financial support to the Combned Ent ty including the converse() of the USS180,165 due to HECL as of December 31. 2014 into to snare capital of Hendon Energy (Xiling.de) Co Ltd and Honton Energy (Baotou) Co Ltd, as necessary On May 5. 2015. HECL entered nto a share purchase agreement to see all of its equity 'leftists in Honiton %IL and Hendon BAV to a subsidiary of TerraForrn Global, Inc ('Acgaren) In connection with tne proposed acquiseon of the Comtmed Entity, the Acquirer has provided a letter to HECL stating that lie Acqmer will take necessary actions to cause the Combined Entry to make payment when the bark ban matures Taking rib consideration the commitments of HECL and the Acquirer to provide the Combined Entity the necessary financial support management believes the Combined Endy will be able to meet its commtments and liabilities when they fat die la a penod extending M least one year beyond the date of the francaI statements b Breda of consolidation The accompanying combined Ina mat statements reticle the Ina mat statements of hlontton XIL and its whoa/ awned subsidiary Hannon /GI irguale and Honiton BAV and its whotty twined sdasidiary Hendon Baotou All sidle!dant intercompany balances and transactions have been eltmnated in preparing the combined financial statements e se of esdsnafes The preparation of the combined financial statements n accordance with US GAAP requires management to make estimates and assumptions trot affect the reported anoints of assets and habit es at Inc balance steer dates and the reported amounts d revenues and expenses during the reporting periods Actual resets cods! materially fitter from these estimates Signifcant items subject to such estimates and assumptions icbtbe the useful Was Of progeny. plant and thatsement and land use rights. the Gotland:Orly cf accounts renewable. the reatizatrIty of deferred rcorne tax assets, the recovered Ity of the carrying amounts d property, plant and equipment and land use notes the accruals toe tax uncertainties and other contingences The Combined Entity bases its tamales on historical expenerce and various other faders believed to be reasonable under the orcumsta nen. he feuds ct who h form the bests for raking tudgmerls about the QV ryng value of assets and liabilities Vaal are not readily apparent from other sources The current eta erne erreffinmere has increased the degree of uncertainty inherent in test estimates and assumptions d Foralgn cadency The accompanying combined fine mat statements are presented in the U S dollar CUSS') The ftnctonal currency of Hordon XL and Honiton BAV is USS whereas the 'undone' currency of Honda) %how:amend Holton Baotou is the Rerrninbi claJAEr) Transactions denominated in forego drrencies other than the lux-tonal currency are translated into The functional currency at the exchange rates prevailing at the dates of the traceaotOnS Monetary assets and Natal t es denominated in forego etrrences are translated irko the functional currency using the app4)cable exchange rates at the balance sheet Oates The resulting exchange differences are recorded in 'foreign currency exchange gain (IOSS) net in the combined Statements of compnehenove loss F-259 http://cldocs.btoLto. com:27638/cf/dry7/pub/edgar/2015/07/20/0001193125-15-256461/d78... 7/20/2015 CONFIDENTIAL - PURSUANT TO FED. R. GRIM. P. 6(e) DB-SDNY-0058536 CONFIDENTIAL SDNY_GM_00204720 EFTA01367008