Note 20 - Related Party Transactions

12 Months Ended

Dec. 31, 2012

Related Party Transactions Disclosure [Text Block]

20. Related Party Transactions

In the fourth quarter of 2009, the Company completed a system installation under an EPC contract entered into with STP. Subsequent to the end of 2009, Stephen C. Kircher, our Chief Executive Officer, and his wife, Lari K. Kircher, as Co-Trustees of the Kircher Family Irrevocable Trust dated December 29, 2004 (“Trust”) was admitted as a member of HEK, LLC (“HEK”), a member of STP. The Trust made a capital contribution of $20,000 and received a 35% membership interest in HEK. Stephen C. Kircher, as trustee of the Trust, was appointed a co-manager of HEK. Neither Stephen C. Kircher nor Lari K. Kircher is a beneficiary under the Trust.

On March 31, 2011, the Company and LDK consummated the transactions contemplated by the second closing of the SPA whereby the Company issued 20,000,000 shares of Series A Preferred Stock for an aggregate purchase price of $22.2 million. On June 22, 2011, the shareholders of the Company approved an amendment to the Company’s Articles of Incorporation increasing the authorized shares and enabling the automatic conversion of the 20,000,000 Series A Preferred stock to 88,910,400 shares of the Company’s Common Stock. The 20,000,000 shares of Series A Preferred Stock were cancelled pursuant to the conversion. In combination with the issuance of 42,835,947 shares of Solar Power, Inc.’s Common Stock in January in exchange for $10.7 million, the total shares owned by LDK 71% of the Company’s outstanding Common Stock as of June 22, 2011.

In June 2011, the Company transferred to LDK Solar USA, Inc. at book value its interest in North Palm Springs Investments, LLC (“NPSLLC”), a wholly owned subsidiary of LDK Solar USA, Inc., and entered into two EPC agreements with NPSLLC for the construction of two utility scale solar projects with a combined contract value of $29.2 million. The EPC agreements provide for milestone payments based on performance against a schedule of values.

In September 2012, Solar Green Technology SA (“SGT”) transferred its interest in its wholly owned subsidiary, Moiac Solare Srl (“Moiac”), to Terrasol Solar SA (“Terrasol”). Terrasol’s parent, Century Solar Jewel SA is 40% owned by LDK Solar Europe Holding SA, a wholly owned subsidiary of LDK. The total contract value from the EPC agreements for the construction of 641kW solar development projects owned by Moiac is $1.9 million.

In June 2012, SGT began construction on multiple solar development projects under EPC agreements with Terrasol. The total contract value from the construction of these solar development projects is $16.1 million.

During the year ended December 31, 2012, the Company recorded net sales to LDK, NPSLLC and Terrasol of $35.5 million with a cost of goods sold of $32.6 million, primarily consisting of solar development costs. During the year ended December 31, 2011, the Company recorded net sales to LDK and NPSLLC of $31.5 with a cost of goods sold of $28.4 million, primarily consisting of solar development costs and the sale of an Italian SEF to LDK. As of December 31, 2012, accounts receivable from LDK was $11.9 million, primarily related to the receivables from solar development projects with and inventory sale to LDK. As of December 31, 2011, the Company had accounts receivable of $24.6 million from LDK and NPSLLC, primarily related to billings under EPC contracts with milestone payments due upon performance against a schedule of values in the agreements.

As of December 31, 2012 and 2011, the Company had accounts payable to LDK of $51.8 million and $62.2 million, respectively, primarily related to purchases of solar panels for solar development projects. See Note 2—Going Concern Considerations and Management’s Plan for further discussion related to the accounts payables with LDK.