Item 1.01. Entry into a Material Definitive Agreement.
On April 9, 2018, Real Goods Solar, Inc. (the “Company”) entered into two separate Amendment
No. 1 to Securities Purchase Agreement (the “Amendments”) with each Investor (as defined below) party to the Purchase
Agreement (as defined below) related to the Company’s previously announced private placement of convertible notes and warrants.
The substantially identical Amendments attached amended and restated forms of Notes (as defined below) to increase the initial
conversion price of the Notes from $1.2405 to $1.26 per share and, as a result, made changes to the Schedule of Buyers to the Purchase
Agreement to reflect a change in the number of shares of Common Stock (as defined below) that may become issuable upon exercise
of Series Q Warrants (as defined below). The parties entered into the Amendments as a result of certain discussions with, and comments
by, Nasdaq staff. Other than as described in this paragraph, no other changes were made to the terms of the Notes or the transaction
in general. The Amendments contains customary provisions for agreements of this nature, such as representations, warranties and
covenants.
On April 9, 2018, the Company closed the previously announced
private placement of convertible notes and warrants with two unaffiliated institutional and accredited investors (the “Investors”)
in which the Company issued and sold to the Investors (i) $10.75 million in principal amount and $10 million funding amount (reflecting
an original issue discount of $750,000) of convertible notes due April 9, 2019, consisting of (A) two Series A Senior Convertible
Notes in the aggregate principal amount of $5,750,000 (the “Series A Notes”) in consideration for aggregate cash payments
of $5,000,000, (B) two Series B Senior Secured Convertible Notes in the aggregate principal amount of $5,000,000 (the “Series
B Notes,” and collectively with the Series A Notes, the “Notes”) for consideration consisting of two secured
promissory notes, each issued and payable by an Investor, in the aggregate principal amount of $5,000,000 (each, an “Investor
Note”), and (ii) Series Q Warrants (the “Series Q Warrants”) to purchase up to 9,126,984 shares of the Company’s
Class A common stock (the “Common Stock”) under the terms of the Securities Purchase Agreement, dated March 30, 2018,
among the Company and the Investors (the “Purchase Agreement”). In lieu of initially receiving any original issue discount
on the Series B Notes, the Series B Notes accrue an “Additional OID Amount” (as defined in the Series B Notes) based
upon the portion of the principal of the Series B Notes that becomes unrestricted from time to time, pro rata, which, in the aggregate
would result in up to $750,000 of Additional OID Amount payable under the Series B Notes if all of the principal under the Series
B Notes becomes unrestricted. The Company received net proceeds of approximately $4.4 million at the closing, after deducting commissions
to the Placement Agent (as defined below) and estimated offering expenses payable by the Company associated with the private placement.
The Notes are convertible into shares of Common Stock at an
initial conversion price of $1.26 per share and the Series Q Warrants are exercisable for shares of Common Stock at an initial
exercise price of $1.12 per share, in each case, subject to adjustment. The Notes and the Series Q Warrants were issued in physical
form separately from each other and may be transferred separately immediately thereafter, subject to applicable law. The Notes
and the Series Q Warrants will not be listed on any national securities exchange or other trading market, and no trading market
for the Notes and the Series Q Warrants is expected to develop.
At the closing on April 9, 2018, the parties entered into or
executed the following agreements and documents:
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The Company entered into a Registration Rights Agreement (the “Registration Rights Agreement”) with the Investors
under which the Company has agreed to register for resale the shares of Common Stock issuable upon conversion of the Notes and
upon exercise of the Series Q Warrants.
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The Company entered into separate Note Purchase Agreements (each, an “NPA”) with each Investor under which each
Investor issued to the Company such Investor’s Investor Note.
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Each Investor issued an Investor Note to the Company under the respective NPA.
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The Company entered into separate Master Netting Agreements (each, a “Master Netting Agreement”)
with each Investor for the purpose of clarifying for each party its right to offset obligations that may arise under the Purchase
Agreement, the Investor Notes and the Series B Notes upon the occurrence of certain events.
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In connection with the transaction, the Company reimbursed the
lead Investor’s legal fees of approximately $106,000.
Both of the Investors have participated in the Company’s
past securities offerings and the Company believes that one of the Investor is a beneficial owner of more than 5% of the Common
Stock based on a review of such Investor’s filed Schedules 13G.
As previously reported, WestPark Capital, Inc. acted as the
exclusive placement agent for the transaction (the “Placement Agent”) pursuant to the terms of an Engagement Letter,
dated January 29, 2018, between the Company and the Placement Agent (the “Engagement Letter”). At the closing, the
Company paid the Placement Agent an aggregate cash fee of $350,000. The Company will pay the Placement Agent an additional cash
fee of up to $350,000 if and to the extent the Investors prepay the Investor Notes. In connection with the transaction, the Company
also reimbursed the Placement Agent’s expenses of $29,000.
At the closing on April 9, 2018, the Company issued and sold
to the Placement Agent for a sum of $100 a warrant (the “Placement Agent Warrant”) to purchase 730,159 shares of Common
Stock, pursuant to the terms of the Engagement Agreement. The Placement Agent Warrant has substantially the same terms as the Series
Q Warrants other than that the Placement Agent Warrant has a cashless exercise right regardless of whether an effective registration
statement registering, or a current prospectus being available for, the resale of the shares of Common Stock underlying the Placement
Agent Warrant.
The Company previously reported the terms of the Notes, the Series Q Warrants, the Registration Rights
Agreement, the NPA, the Investor Note, the Master Netting Agreement, the Placement Agent Warrant and the terms of the offerings
under Item 1.01 of its Current Report on Form 8-K filed on April 2, 2018, and such disclosure is incorporated herein by reference.
There has been no change in the terms of the transaction from such prior disclosure other than that the initial conversion price
of the Notes is $1.26 (not $1.2405). Also, the floor price under the “Alternative Conversion Price” in the Notes was
misstated as $0.20 in the Company’s Current Report on Form 8-K filed on April 2, 2018 due to a rounding error and is stated
as $0.194 in the final Notes.
The foregoing descriptions of the Amendments, the Notes, the
Series Q Warrants, the Registration Rights Agreement, the NPAs, the Investor Notes, the Master Netting Agreements and the Placement
Agent Warrant do not purport to describe all of the terms and provisions thereof and are qualified in their entirety by reference
to the form of Amendment, the form of Series A Note, the form of Series B Note, the form of Series Q Warrant, the Registration
Rights Agreement, the form of NPA, the form of Investor Note, the form of Master Netting Agreement and the form of Placement Agent
Warrant which are filed as Exhibits 10.1, 4.1, 4.2, 4.3, 10.2, 10.3, 4.4, 10.4 and 4.5, respectively, to this Current Report on
Form 8-K and are incorporated herein by reference.