SunPower Corporation (NASDAQ:SPWR) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01.
Entry into a Material Definitive Agreement.
On March 26, 2019, SunPower Corporation (the “Company”) and SunPower AssetCo, LLC, a Delaware limited liability company and a wholly-owned subsidiary of the Company (“SunPower AssetCo”) entered into a Membership Interest Purchase and Sale Agreement (the “Purchase and Sale Agreement”) with Elizabeth Cady Lessee Holdco LLC, a Delaware limited liability company (“Buyer”), an indirect wholly-owned subsidiary of Goldman Sachs Renewable Power LLC, a Delaware limited liability company, which is expected to have the effect of deconsolidating the solar power systems associated with the Company’s commercial sale-leaseback transactions accounted under the financing method.
to the Purchase and Sale Agreement, SunPower AssetCo has agreed to sell to Buyer, and Buyer has agreed to purchase from SunPower AssetCo, in exchange for consideration of up to $86.9 million, the membership interests owned by SunPower AssetCo (or, in the case of certain of such interests that are currently held by the Company directly or indirectly through other subsidiaries, to be owned by SunPower AssetCo immediately prior to closing) in certain holding company subsidiaries (the“HoldCos”) that, in turn, own, directly or indirectly, the membership interests in one or more limited liability companies that own leasehold interests in operating solar photovoltaic electric generating projects (the “Projects”) subject to sale-leaseback financing arrangements, along with other related subsidiaries (“Related Subsidiaries”). The sale-leaseback financing arrangements were entered into with the following institutions (or their applicable affiliates): Wells Fargo Bank, PNC Bank, MetLife, Regions Bank and SunTrust (the “Lessors”). The Projects are located at approximately 200 sites in Alabama, Arizona, California, Colorado, Connecticut, Hawaii, New Jersey, New York, and Texas, and represent in the aggregate approximately 233 MW of generating capacity.
The consummation of the sale and purchase of each of the HoldCos and Related Subsidiaries, to the Purchase and Sale Agreement, which may occur in one or more closings, will be subject to a number of customary conditions precedent, including receipt of certain third-party consents and approvals, including those of the applicable Lessor, absence of material adverse changes, expiration or early termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The Purchase and Sale Agreement contains a number of representations and warranties of SunPower AssetCo and the Company that are of the type customary in acquisition transaction, including among others, those as to corporate matters, title, certain environmental and regulatory matters, solvency, project contracts and permits, compliance with laws, accuracy and completeness of disclosure and absence of defaults, legal proceedings and undisclosed liabilities, tax matters, as well as certain covenants with respect to pre-closing conduct of business and certain post-closing matters. The Company and SunPower AssetCo have agreed to indemnify Buyer and certain related persons of Buyer, subject to certain thresholds, limitations and caps, for claims or losses that may be suffered or incurred by them as a result of breaches of representations, warranties, or covenants or as a result of certain other specified events or circumstances with respect to the Projects, as more fully described in the Purchase and Sale Agreement.
The foregoing description is not a complete description of all terms and is qualified in its entirety by reference to the full text of the Purchase and Sale Agreement, a copy of which will be filed as an exhibit to our quarterly report on Form 10-Q for the quarter ended March 31, 2019.
Forward-Looking Statements
The above information contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding the Company’s expectations regarding the sale of its commercial lease portfolio more generally and the anticipated effects on its financial statements and results of operations. These forward-looking statements are based on the Company’s current assumptions, expectations and beliefs and involve substantial risks and uncertainties that may cause results, performance or achievement to materially differ from those expressed or implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: challenges in executing this or other transactions key to our strategic plans, management’s plans and objectives for future operations, our ability to comply with and perform our contractual obligations, expected capital expenditures, warranty matters, outcomes of litigation, interest and credit risk, general business and economic conditions in our markets, industry trends, and the impact of changes in law (including tax law), regulations or government incentives. A detailed discussion of these factors and other risks that affect the Company’s business is included in filings the Company makes with the Securities and Exchange Commission (the “SEC”) from time to time, including the Company’s most recent reports on Form 10-K, particularly under the heading “Risk Factors.” Copies of these filings are available online from the SEC or on the SEC Filings section of the Company’s Investor Relations website at investors.sunpower.com. All forward-looking statements in this Current Report on Form 8-K are
based on information currently available to the Company, and the Company assumes no obligation to update these forward-looking statements in light of new information or future events.
About SunPower Corporation (NASDAQ:SPWR)
SunPower Corporation is a global energy company. The Company provides solar technology to residential, commercial and utility customers worldwide. The Company operates through three segments: Residential Segment, Commercial Segment and Power Plant Segment. The Company designs, manufactures, and sells rooftop and ground-mounted solar power systems under construction and development agreements. It offers post-installation systems monitoring and maintenance in connection with its construction contracts and commercial power purchase. The Company offers SunPower InvisiMount residential mounting system in its product portfolio. The Company offers Helix system, which is a pre-engineered, modular solution that combines its solar module technology with plug-and-play power stations, cable management systems and mounting hardware that enables customers to scale their solar programs with minimal business disruption. It offers modular solar power block, the Oasis system.
