UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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): April 28, 2020
SUNWORKS, INC.
(Exact Name of the Registrant as Specified in Charter)
| Delaware | | 001-36868 | | 01-0592299 |
(State or Other Jurisdiction of Incorporation) | | (Commission File Number) | | (IRS Employer Identification No.) |
1030 Winding Creek Road, Suite 100 Roseville, CA | | 95678 |
| (Address of Principal Executive Offices) | | (Zip Code) |
(916) 409-6900
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:
| [ ] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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| [ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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| [ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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| [ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | | Trading Symbol | | Name of each exchange on which registered |
| Common Stock, par value $0.001 | | SUNW | | NASDAQ Capital Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company [ ]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
Item 1.01 Entry into a Material Definitive Agreement.
On April 28, 2020, Sunworks, Inc. (the “Company”) entered into a loan agreement with Tri Counties Bank (“Lender”), as lender (the “Loan Agreement”), pursuant to which, the Company executed a Note evidencing a loan in the amount of $2,847,400 (the “PPP Note”) under the Paycheck Protection Program (“PPP”). The PPP was established under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) and is administered by the U.S. Small Business Administration (“SBA”). The PPP Note bears interest at 1.00% per annum, payable monthly beginning November 1, 2020, and is due on April 28, 2022.
Under the PPP, the Company may apply for loan forgiveness up to the full amount due on the PPP Note. The forgiveness amount will be equal to the amount that the Company spends during the 8-week period beginning April 28, 2020 on payroll costs, any payment of interest on a covered mortgage obligation (which shall not include any prepayment of or payment of principal on a covered mortgage obligation), any payment on a covered rent obligation, and any covered utility payment. The maximum amount of loan forgiveness for non-payroll costs is 25% of the amount of the PPP Note. No assurance is provided that the Company will obtain forgiveness under the PPP Note in whole or in part.
The PPP Note contains customary events of default relating to, among other things, payment defaults, making materially false and misleading representations to the SBA or Lender, or breaching the terms of the Loan Agreement or PPP Note. The occurrence of an event of default may result in the immediate repayment of all amounts outstanding, collection of all amounts owing from the Company, or filing suit and obtaining judgment.
This summary is qualified in its entirety by reference to the terms of the Loan Agreement and the PPP Note, each of which will be filed as exhibits to the Company’s Quarterly Report on Form 10-Q for the period in which the Loan Agreement and PPP Note were executed.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
See Item 1.01 above which is incorporated herein by reference.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
| | SUNWORKS, INC. |
| | | |
| Date: April 30, 2020 | By: | /s / Charles F. Cargile |
| | Name: | Charles F. Cargile |
| | Title: | Chief Executive Officer |
