Sec Form 13D Filing - Zhonghuan Singapore Investment & Development Pte. Ltd. filing for Maxeon Solar Technologies, Ltd. (MAXN) - 2025-02-20

Item 4 of the Schedule 13D is hereby supplemented by adding the following:

Entry Into Sale and Purchase Agreement

As previously disclosed, on November 26, 2024, the Issuer and TCL Zhonghuan Renewable Energy Technology Co., Ltd. ("TZS Parent") and/or certain of its subsidiaries (collectively, "TZE"), including Zhonghuan Singapore Investment and Development Pte. Ltd. ("TZS"), entered into a partially binding term sheet (the "Term Sheet") in connection with the potential acquisition by TZE of the Issuer's non-US, 'rest-of-the-world' distributed generation business through acquisition of 100% of the equity interests in certain direct and indirect non-U.S. subsidiaries of the Issuer (the "Target Entities" and such transaction "Project Birch").

On February 18, 2025 (the "Signing Date"), Lumetech B.V., a subsidiary of TZE organized under the laws of the Netherlands ("Lumetech"), TCL Sunpower International Pte. Ltd., a subsidiary of TZE organized under the laws of Singapore ("TCL Sunpower" and together with Lumetech, the "Purchasers"), and the Issuer, entered into a definitive Sale and Purchase Agreement (the "SPA"), pursuant to which the Purchasers will acquire all of the issued and fully-paid ordinary shares in the capital of each Target Entity, and all of the partnership interests of each of the Issuer's subsidiaries identified as "Mexican Entities" in the SPA (collectively, the equity and partnership interests, the "Shares"). The aggregate consideration for the sale of the Shares will be approximately USD$29 million ("Total Consideration"), which shall be payable on the closing date (the "Closing Date") of the transactions contemplated under the SPA, less any installments already paid by the Purchasers to the Issuer following the signing of the Term Sheet. If there is Net Intercompany Debt owing from the Issuer and its existing subsidiaries to the Target Entities and certain subsidiaries identified in the SPA, as of the Closing Date, the Purchasers will assume all of the Issuer's and its subsidiaries' obligation to repay the Net Intercompany Debt and release and discharge them from the obligation to repay such debt as from and including the Closing Date. If as of the Closing Date the Net Intercompany Debt exceeds US$120 million, the SPA provides that such debt will be capped at US$120 million.

The closing of the transactions contemplated under the SPA (the "Closing") is subject to receipt of certain customary closing deliverables by each party, including the Purchasers' receipt of the outbound direct investment approval from the PRC National Development and Reform Commission (and/or the PRC Ministry of Commerce and/or PRC State Administration of Foreign Exchange) ("ODI Approval") related to the transactions contemplated under the SPA, certain consents, waivers and notification requirements, including but not limited to: (i) receipt of the fairness opinion as contemplated in the Term Sheet, confirming that the terms of the transactions contemplated under the Transaction Documents (as defined below) are fair from a financial perspective; (ii) the definitive "opinion" (avis) of the works council (CSE) of SunPower Energy Solutions France SAS consistent with the terms and conditions of the SPA (the "Works Council Opinion"); (iii) the consummation of the transactions contemplated under an Asset Transfer Agreement in accordance with its terms; (iv) the delivery of a signed Trademark Assignment Agreement, effective as of the Closing Date; and (v) the signing of a Transitional Services Agreement, pursuant to which Lumetech (or its affiliates) will agree to provide certain transition services to the Issuer (or its affiliates) and vice versa (each of the Asset Transfer Agreement, the Trademark Assignment Agreement, and the Transitional Services Agreement, collectively referred to herein as the "Ancillary Agreements"). As of the Signing Date, the Issuer had received the Works Council Opinion.

After the Closing Date and in compliance with applicable laws, the Purchasers will have the right, at their sole discretion, to make employment offers to any Issuer employees identified in the SPA. 

The SPA and each Ancillary Agreement (collectively, the "Transaction Documents") contain customary representations, warranties and covenants made by their respective parties thereto. The obligation of the parties to consummate the transactions contemplated by the Transaction Documents is subject to the satisfaction or waiver of a number of customary conditions and obtaining of requisite approvals and consents, and to the extent that the conditions set forth in the SPA are not fulfilled or waived on or before 11:59pm C.S.T on March 31, 2025 or such other date as the parties may mutually agree in writing (the "Long Stop Date"), the SPA shall lapse and cease to have any further effect. The Long Stop Date will be automatically extended by a period of 30 days or such other period as the parties to the SPA mutually agree if the non-fulfilment of certain Closing conditions is attributable solely to the relevant governmental authority. If the Closing of the transactions contemplated under the SPA does not take place whether by reason of non-fulfillment of certain Closing conditions or of the Issuer's entering into insolvency proceedings which prevent the Issuer from proceeding with the Closing, then any portion of the Total Consideration paid by the Purchasers to the Issuer shall be refunded to the Purchasers along with interest at the effective federal funds rate of the United States of America on the Long Stop Date or the date of commencement of insolvency proceedings, as the case may be, within 60 days of the event triggering the refund.

The information disclosed in this Item 4 with respect to the SPA does not purport to be complete and is qualified in its entirety by reference to the SPA, a copy of which is attached hereto as Exhibit 7.19 and which is incorporated herein by reference in its entirety.

Entry Into Trademark Assignment Agreement

On the Signing Date, TCL Sunpower (the "Assignee") and Maxeon Solar Pte. Ltd., an affiliate of the Issuer organized under the laws of Singapore ("MSPL" or the "Assignor") entered into a Trademark Assignment Agreement in the form of Exhibit 7.20 attached hereto (the "Trademark Assignment Agreement"), pursuant to which, as of the Closing Date, the Assignee will acquire all of the Assignor's right, title and interest, in certain trademarks, and the Assignor will assign all such right, title and interest in and to the trademarks to the Assignee for a total consideration of USD$6.74 million, upon the terms and conditions set forth in the Trademark Assignment Agreement. The trademarks subject to the Trademark Assignment Agreement relate to trademark registrations and applications for "SunPower" in all jurisdictions excluding the United States.

The information disclosed in this Item 4 with respect to the Trademark Assignment Agreement does not purport to be complete and is qualified in its entirety by reference to the Trademark Assignment Agreement, a copy of which is attached hereto as Exhibit 7.20 and which is incorporated herein by reference in its entirety.

There can be no assurance that the transactions contemplated in any of the Transaction Documents will be consummated. 

On February 18, 2025, in connection with Project Birch, TZS entered into consents with respect to (a) the indenture dated June 20, 2024, relating to the 9.00% Convertible First Lien Senior Secured Notes due 2029, by and among, the Issuer, Deutsche Bank Trust Company Americas, as trustee, DB Trustees (Hong Kong) Limited, as the collateral trustee and, solely with respect to the Philippine collateral, RCBC Trust Corporation; (b) the indenture dated August 17, 2022, relating to the Variable-Rate Convertible First Lien Senior Secured Notes due 2029, by and among, the Issuer, Deutsche Bank Trust Company Americas, as trustee, DB Trustees (Hong Kong) Limited, as the collateral trustee and, solely with respect to the Philippine collateral, RCBC Trust Corporation; and (c) the shareholders agreement dated August 26, 2020 (as amended and restated on August 30, 2024) entered into among the Issuer and TZS to permit and facilitate the consummation of Project Birch.

The Reporting Persons intend to review their investment in the Issuer on a continuing basis and may from time to time and at any time in the future, depending on various factors, including, without limitation, the outcome of any discussions referenced above, the Issuer's financial position and strategic direction, actions taken by the Board, price levels of the Ordinary Shares, other investment opportunities available to the Reporting Persons, conditions in the securities markets and general economic and industry conditions, take such actions with respect to their investment in the Issuer as they deem appropriate, including, without limitation: (i) acquiring additional Ordinary Shares and/or other securities of the Issuer; (ii) disposing of any or all of their Ordinary Shares and/or other securities of the Issuer; (iii) engaging in hedging or similar transactions with respect to the securities of the Issuer; (iv) causing or facilitating changes to the capitalization, corporate structure or governing documents of the Issuer; (v) acquiring additional assets of the Issuer and/or its subsidiaries, or (vi) proposing or considering, or changing their intention with respect to, one or more of the actions described in subsections (a) through (j) of Item 4 of the Schedule 13D.

The responses of the Reporting Persons to Rows 7 through 13 of the cover pages of this Amendment No. 12 are incorporated herein by reference. As of the date hereof, TZS is the direct owner of and may be deemed to have shared voting and dispositive power with respect to, and TZS Parent may be deemed to beneficially own and have shared voting and dispositive power with respect to, 9,959,362 Ordinary Shares held by TZS, representing in the aggregate approximately 59.3% of the outstanding Ordinary Shares (such percentage is based on 16,796,240 Ordinary Shares outstanding as of February 19, 2025, according to information provided by the Issuer to the Reporting Persons).

The responses of the Reporting Persons to Rows 7 through 13 of the cover pages of this Amendment No. 12 are incorporated herein by reference. As of the date hereof, TZS is the direct owner of and may be deemed to have shared voting and dispositive power with respect to, and TZS Parent may be deemed to beneficially own and have shared voting and dispositive power with respect to, 9,959,362 Ordinary Shares held by TZS, representing in the aggregate approximately 59.3% of the outstanding Ordinary Shares (such percentage is based on 16,796,240 Ordinary Shares outstanding as of February 19, 2025, according to information pro vided by the Issuer to the Reporting Persons).

During the past sixty days, the Reporting Persons have not effected any transactions in the Issuer's Ordinary Shares.

Not applicable.

Not applicable.

Item 6 of the Schedule 13D is hereby supplemented by adding the following:

Item 4 of this Amendment No. 12 is incorporated herein by reference.

Item 7 of the Schedule 13D is hereby supplemented by adding the following:

7.19 Sale and Purchase Agreement, dated as of February 18, 2025, by and between the Issuer and Lumetech B.V., a subsidiary of TZE, and TCL SunPower International Pte. Ltd., a subsidiary of TZE.

7.20 Trademark Assignment Agreement, dated as of February 18, 2025, by and between Maxeon Solar Pte. Ltd., an affiliate of the Issuer and TCL SunPower International Pte. Ltd., a subsidiary of TZE.