SPI Solar to Become One of Largest PV Development Companies
in China Market Following Close of Transaction
ROSEVILLE, Calif.—October 24, 2014 - Solar Power, Inc. ("SPI" or "SPI Solar") (OTCBB: SOPW), a vertically-integrated photovoltaic solar developer, today announced that its wholly owned subsidiary, SPI Solar Power Suzhou Co., Ltd. ("SPI Meitai Suzhou") has entered into a framework purchase agreement with ZhongNeng GuoDian New Energy Development and Investment Jiangsu Co., Ltd. ("ZhongNeng New Energy"), with the intention to acquire six PV projects currently under construction in China, and another framework purchase agreement with ZhongNeng GuoDian Green Ecological Cooperation and Development Jiangsu Co., Ltd. ("ZhongNeng GuoDian"), with the intention to acquire the equity interest in ZhongNeng New Energy.
"We are pleased to announce these agreements and our intention to acquire the six PV projects, comprising a total of 360 megawatts ("MWs") in China, and ZhongNeng New Energy, a proven PV project development platform with an excellent pipeline," said Xiaofeng Peng, Chairman of SPI. "By adding these projects to our portfolio and acquiring this development company, we expect to increase our scale and future cash flows and expand our development capabilities in key strategic regions, strengthening SPI Solar's leading position as one of the largest PV development companies in this market."
SPI Meitai Suzhou intends to acquire the six projects under construction in China from ZongNeng GuoDian, including a 40 MW project in Chifeng City, 60 MW in Kezuo County, 50 MW in Shangdu County, and 30 MW in Chayou County, all in Inner Mongolia, as well as a 130 MW project in Zhongwei City, Ningxia and 50 MW in Yanyuan County, Sichuan. Grid connection for these projects is expected to take place from the end of 2014 to the middle of 2015. SPI Meitai Suzhou will pay a deposit of RMB140.0 million (U.S. $22.9 million) in cash by November 20, 2014 to secure the agreement. The final purchase price for the six projects will be decided after further due diligence when the projects are completed.
SPI Solar intends to acquire the 100% equity interest in ZhongNeng New Energy at an aggregate purchase price of RMB100.0 million (U.S. $16.3 million), consisting entirely of SPI's ordinary shares; 49% of the total consideration, or RMB49.0 million (U.S. $8.0 million) will be determined based on the Renminbi-to-U.S.-dollar exchange rate and closing price of SPI's ordinary shares of U.S. $2.35 per share on October 22, 2014, or approximately 3.4 million ordinary shares, and 51% of the total consideration, or RMB51.0 million, will be based on the five-day averages of the trading prices of SPI's ordinary shares and Renminbi-to-U.S.-dollar exchange rates prior to the closing date of the acquisition.
Subject to the terms and conditions of the framework agreements, SPI Meitai Suzhou and ZhongNeng New Energy will enter into a definitive purchase agreement for the purchase of the six projects by March 31, 2015, and SPI Meitai Suzhou and ZhongNeng GuoDian will enter into a definitive purchase agreement for the acquisition of ZhongNeng New Energy within five days thereafter.
SPI Solar plans to acquire more PV projects using SPI Meitai Suzhou as an investment platform.
About Solar Power, Inc. (SOPW):
Solar Power, Inc. ("SPI" or "SPI Solar") is a vertically-integrated photovoltaic solar developer offering its own brand of high-quality, low-cost distributed generation and utility-scale solar energy facility development services. From project development, to project financing and to post-construction asset management, SPI delivers turnkey world-class photovoltaic solar energy facilities and turnkey residential solar solutions to its business, government and utility customers. For additional information visit: www.spisolar.com.
Safe Harbor Statement:
This release may contain certain "forward-looking statements" relating to the business of SPI Solar, its subsidiaries and the solar industry, which can be identified by the use of forward-looking terminology such as "will," "expects," "anticipates," "future," "intends, "plans," "believes," "estimates," "expects" or similar expressions. These statements constitute "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. Among other things, the quotations from management in this press release and the Company's operations and business outlook, contain forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties, including uncertainties regarding whether the transactions contemplated will be successfully completed and whether the acquisition of the projects will be successful. All forward-looking statements are expressly qualified in their entirety by this cautionary statement and the risks and other factors detailed in the company's reports filed with the Securities and Exchange Commission. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities law.
Currency Convenience Translation
Unless otherwise noted, the conversion of Renminbi into U.S. dollars in this release, made solely for the convenience of the readers, is based on the noon buying rate in the city of New York for cable transfers of Renminbi as certified for customs purposes by the Federal Reserve Bank of New York as of June 30, 2014, which was RMB6.2036 to U.S. $1.00. No representation is intended to imply that the Renminbi amounts could have been, or could be, converted, realized, or settled into U.S. dollars at that rate or any other rate. The percentages stated in this press release are calculated based on Renminbi.