UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 7, 2011
SOLAR POWER, INC.
(Exact name of registrant as specified in its charter)
| |
|
|
|
|
|
| California
|
|
000-50142
|
|
20- 4956638 |
| |
|
|
|
|
(State or other jurisdiction of
incorporation or organization)
|
|
(Commission File Number)
|
|
(I.R.S. Employer
Identification No.) |
1115 Orlando Avenue
Roseville, California 95661-5247
(Address and telephone number of principal executive offices) (Zip Code)
(916) 746-0900
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
|
|
|
| o |
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
|
|
|
| o |
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
|
|
|
| o |
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
|
|
|
| o |
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
|
|
|
|
| Item 1.01 |
|
Entry into a Material Definitive Agreement |
The Company previously constructed a photovoltaic system for Solar Tax Partners 1, LLC (“STP”)
located on land owned by Aerojet in Rancho Cordova, California (the “Generating Facility”). In
order for the Company to be paid for such work, and as previously disclosed, the Company helped to
facilitate financing for STP with Umpqua Bank by funding a reserve in the amount of $1,000,000
(“Umpqua Loan”).
The Company entered into a Reserve Account Security Agreement (the “Security Agreement”) with East
West Bank (“East West”) in order to facilitate the refinance by STP of the Umpqua Loan. Under the
Security Agreement, the Company deposited $400,000 from reserve funds released by Umpqua into a
pledged account at East West as collateral for the STP loan. Pursuant to the Security Agreement,
East West may exercise its rights to the collateral in the event of a default as defined in the
Security Agreement, which includes, among other things, the failure of STP to make timely payments
under the Loan Agreement. The Security Agreement provides that $80,000 of the reserve funds will
annually be released to the Company, provided that there is no default under the East West loan.
The refinance benefits the Company by reducing the amount of Company funds held as loan reserves
from $1,000,000 to $400,000 and allowing for annual reductions in the reserve amount. This results
in immediate proceeds to the Company of approximately $211,119 after costs and related expenses,
and annual proceeds of $80,000 to the Company over each of the next five (5) years, provided that
there is no default under the East West loan.
The description of the Security Agreement is a summary only, does not purport to be complete and is
qualified in its entirety by reference to the Exhibit attached hereto.
As previously disclosed, Stephen C. Kircher, the Company’s Chief Executive Officer and Chairman of
the Board, and his wife Lari K. Kircher, as Co-Trustees of the Kircher Family Irrevocable Trust
dated December 29, 2004 (“Trust”) is a member of HEK holding a non-controlling membership interest
and Stephen C. Kircher, individually, was appointed a non-controlling co-manager of HEK.
Additionally, as previously disclosed, each of Mr. Kircher and the Trust guaranteed a portion of
the Umpqua Loan and the Trust pledges certain shares of the Company’s Common Stock as collateral
for its guaranty. HEK is the managing member of STP.
While Mr. Kircher and the Trust do not control HEK, they could be deemed an affiliate. Therefore
the Company elected to treat this transaction as a related party transaction and it was approved by
the independent directors of the Company.
|
|
|
| Item 9.01 |
|
Financial Statements and Exhibits. |
(d) Exhibits.
| |
|
|
|
|
| Exhibit |
|
|
| No. |
|
Description |
| |
10.1 |
|
|
Reserve Account Security Agreement dated January 7, 2011 |
2