AAER Signs Reservation Agreement With Mont Louis Wind

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AAER Inc., a turbine manufacturer based in Bromont, Quebec, has signed a reservation agreement for 61 1.65 MW wind turbines to be delivered to Mont Louis Wind LP – represented by NPI Wind Power GP II Inc. and Northland Power Wind GP II Inc. – for its 100 MW wind farm project in Saint-Maxime-du-Mont-Louis, Quebec. The 61 A-1650s are scheduled for delivery during the third quarter of 2010.

‘This agreement is a milestone for AAER, as it represents the lead order for our new 1.65 MW A-1650 wind turbine and provides important validation of our turbine technology and production capacity,’ says Dave Gagnon, president and CEO of AAER. ‘It also strengthens our order backlog and provides excellent visibility on our long-term supply chain, as we start ramping up production in Q4 2008 toward our production goals for 2009 and 2010.’

The reservation agreement enables Mont Louis Wind to secure a manufacturing and delivery schedule for the 61 A-1650 wind turbines while a turbine supply agreement (TSA) and warranty, maintenance and service agreement (WMSA) are being agreed upon by Mont Louis Wind and AAER. Mont Louis Wind and AAER have agreed on a cost plus structure for the supply of the wind turbines.

The final pricing and other terms and conditions will be set at the signature of the TSA. The overall sale price is currently estimated at approximately $142 million. The conditions to be met by AAER and Mont Louis Wind before the execution of a definitive TSA include evidence of the required financing by both parties, agreement on a definitive delivery and payment schedule and technical due diligence to be performed by a third party for financing purposes. AAER and Mont Louis Wind expect to execute the TSA and the WMSA within 120 days of the signature of the reservation agreement.

SOURCE: AAER Inc.

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