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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): September 4, 2007
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SPIRE CORPORATION
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(Exact Name of Registrant as Specified in Charter)
Massachusetts 0-12742 04-2457335
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(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
One Patriots Park, Bedford, Massachusetts 01730-2396
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(Address of Principal Executive Offices) (Zip Code)
(781) 275-6000
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(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):
|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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ITEM 2.01 COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS.
On September 4, 2007, Spire Corporation (the "Company") and Gloria Solar
Co., Ltd., a company organized under the laws of the Republic of China (Taiwan)
("Gloria Solar"), closed their previously announced transaction, entered into on
July 31, 2007, pursuant to which (i) the Company sold to Gloria Solar certain
assets belonging to the Company's solar systems business and (ii) the Company
and Gloria Solar formed a joint venture (the "Joint Venture") for the purpose of
pursuing the solar photovoltaic systems market within the United States; the
Joint Venture will design, market, sell and manage the installation of systems
for the generation of electrical power by solar photovoltaic means in primarily
commercial/industrial and utility segments of such market. The Joint Venture's
business is referred to herein as the "JV Business." The contractual
relationship is characterized by the following three major agreements:
1. An Asset Purchase Agreement pursuant to which the Company sold certain assets
belonging to its solar systems business to Gloria Solar for $4,000,000. Such
assets included the Company's module production line it has used to make
customized building integrated photovoltaic modules, module and systems designs
and related technical information. This agreement requires the Company to
recondition the equipment within a four-month period after closing and provide a
one-year warranty. The Company is allowed the rent-free use of the equipment to
complete certain existing requirements and for the training of its equipment
customers.
In connection with the Asset Purchase Agreement, the parties entered into
certain ancillary agreements, including (i) a Subcontracting Agreement pursuant
to which Gloria Solar will subcontract the operation of the purchased assets to
the Joint Venture; and (ii) a Sublease Agreement pursuant to which the Company
will lease space to the Joint Venture for the purpose of operating the acquired
assets for Gloria Solar.
2. A Contribution Agreement pursuant to which (i) the Company contributed to the
Joint Venture its assets primarily relating to the JV Systems Business,
including certain intellectual property and know-how, access to information
technology assets and relationships, relationships with current and previous
customers, contract backlog and project opportunities, a license to certain
registered trademarks, and employment relationships with staff members and (ii)
Gloria Solar contributed $5,000,000 in cash.
3. The Operating Agreement of the Joint Venture, to be known as "Gloria Spire
Solar, LLC." As noted above, the JV Systems Business is to pursue the solar
photovoltaic systems market within the United States and, in connection
therewith, the Joint Venture will design, market, sell and manage the
installation of systems for the generation of electrical power by solar
photovoltaic means in primarily commercial/industrial and utility segments of
the market. Gloria Solar owns 55% of the Joint Venture and the Company owns 45%
of the Joint Venture. The Joint Venture's term is indefinite with provisions for
liquidation/termination, including in any instance of default, as set forth in
the Operating Agreement.
If the managing board, as described below, determines that additional
capital is required to support the operations of the Company, the Joint Venture
shall make a call for additional funds. Within ten (10) days after the members
have received written notice of the call, the members shall make additional
capital contributions to the Joint Venture in proportion to each member's
interest in the Joint Venture. If a member fails to fund its pro rata portion of
any capital call, the non-defaulting member may purchase the defaulting member's
shortfall; however, in no event may the Company's or Gloria Solar's interest in
the Joint Venture be reduced to below 10%.
The Joint Venture will have a managing board composed of five (5) managers
with a rotating chairmanship, allowing any member with at least 50% of the
membership units to appoint three (3) managers, and any member with at least 35%
of the membership units to appoint two (2) managers.
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Major decisions of this body will require at least one affirmative vote by a
Company-appointed manager and at least one affirmative vote by a Gloria
Solar-appointed manager.
With respect to transfers of membership interests, for the first
twenty-four (24) months, neither party may transfer its membership interest.
Thereafter, each member shall have a right of first refusal with respect to
proposed transfers by the other member. In the event of a "change in control" of
a member, the other members may purchase such member's interest in the Joint
Venture.
Further participation by the Company in the business of the Joint Venture
is restricted; for a period of three (3) years, the Company may not mass
manufacture, market or sell solar cell modules with less than 575 watt capacity,
and may do so thereafter only outside the United States. The Company is not
restricted in showing its equipment customers how to manufacture modules or from
using module design technology for research and development purposes. The
members are expected to refrain from competing with Joint Venture in the solar
systems business in the U.S. market.
For any purchase of photovoltaic modules, the Joint Venture shall first
offer to acquire such modules from Gloria Solar, on the same terms it would
otherwise acquire them from a third party supplier in an arm's-length
transaction. If Gloria Solar cannot meet those terms, the Joint Venture may
acquire such modules from a third party supplier. For any purchase of
photovoltaic module manufacturing equipment, the Joint Venture shall first offer
to acquire such equipment from the Company, on the same terms it would otherwise
acquire them from a third party supplier in an arm's-length transaction. If the
Company cannot meet those terms, the Joint Venture may acquire such equipment
from a third party supplier.
In connection with the Operating Agreement, the parties entered into
several ancillary agreements, including (i) a Transitional Services Agreement,
whereby the Company furnishes the Joint Venture with certain administrative and
maintenance services at specified rates; (ii) a Technology License Agreement,
whereby the Joint Venture grants the Company a limited license to certain
photovoltaic module and systems technology which was part of the Company's
contribution to the assets of the Joint Venture, for the purpose of allowing the
Company to continue to do the things expressly permitted under the Operating
Agreement; (iii) an Assignment and Assumption Agreement, whereby the Company
assigns certain contracts and agreements to the Joint Venture; and (iv) several
Trademark License Agreements, whereby the Company licenses the use of its
primary mark ("Spire") and logo elements, for use only in conjunction with the
term "Solar," or as a composite, as in "Gloria Spire Solar LLC." These licenses
are both to Gloria Solar and to the Joint Venture, with a further one from
Gloria Solar to the Joint Venture for use of the mark "Gloria."
In addition, on July 31, 2007, the Company and Gloria Solar entered a
purchase and sale agreement whereby Gloria Solar will purchase a nominal
50-megawatt module production line for the price of $3.8 million. The equipment
is scheduled to be delivered in the first half of 2008.
The disclosure set forth above is a summary of the material provisions of
the Asset Purchase Agreement, the Contribution Agreement and the Operating
Agreement. These summaries are not complete and are qualified in their entirety
by reference to the full text of such agreements, each of which is attached as
an exhibit to this Current Report on Form 8-K. Readers should review those
agreements for a complete understanding of the terms and conditions associated
with the transaction described herein.
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ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(b) Pro Forma Financial Information.
The Company is evaluating the financial significance of the acquisition of
its interest in the Joint Venture resulting from this transaction. To the extent
that such acquisition is determined to be significant, this report on Form 8-K
will be amended to include the Company's unaudited pro forma condensed
consolidated balance sheet and statement of operations as of September 30, 2007
and for the nine months then ended, and for the year ended December 31, 2006.
Such pro forma financial information, if required, will be filed by amendment
within 71 calendar days after the date this report on Form 8-K must be filed.
(d) Exhibits.
Exhibit No. Description
2.1 Asset Purchase Agreement, dated as of July 31, 2007, by
and between the Company and Gloria Solar Co., Ltd.*+
2.2 Contribution Agreement, dated as of July 31, 2007, by and
among the Company, Gloria Solar Co., Ltd. and Gloria
Solar (Delaware) Company, Ltd.*+
10(x) Operating Agreement of Gloria Spire Solar, LLC, dated
July 31, 2007, by and among the Company, Gloria Solar
(Delaware) Company, Ltd. and Gloria Spire Solar, LLC.*
* Portions of this Exhibit have been omitted pursuant to a request
for confidential treatment.
+ The Company agrees to furnish supplementally to the Securities
and Exchange Commission (the "Commission") a copy of any omitted
schedule or exhibit to this agreement upon request by the
Commission.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SPIRE CORPORATION
Date: September 10, 2007 By: /s/ Christian Dufresne
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Christian Dufresne
Chief Financial Officer and Treasurer
EXHIBIT INDEX
Exhibit No. Description
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2.1 Asset Purchase Agreement, dated as of July 31, 2007, by
and between the Company and Gloria Solar Co., Ltd.*+
2.2 Contribution Agreement, dated as of July 31, 2007, by and
among the Company, Gloria Solar Co., Ltd. and Gloria
Solar (Delaware) Company, Ltd.*+
10(x) Operating Agreement of Gloria Spire Solar, LLC, dated
July 31, 2007, by and among the Company, Gloria Solar
(Delaware) Company, Ltd. and Gloria Spire Solar, LLC.*
* Portions of this Exhibit have been omitted pursuant to a request
for confidential treatment.
+ The Company agrees to furnish supplementally to the Securities
and Exchange Commission (the "Commission") a copy of any omitted
schedule or exhibit to this agreement upon request by the
Commission.