Loan Documentation for Photovoltaic Panels and SRECs

1. Loan Documentation forPhotovoltaic Panels and SRECs May 25, 2010 Presented by Burton J. Jaffe, Esq.

2. Photovoltaic Panels –Personalty or Fixtures? • Definition of “Fixture” • N.J.S.A. 12A:9-102(a): “goods that have become so related to particular real property that an interest in them arises under real property law” • If removal would cause molestation and damage

3. Photovoltaic Panels –Personalty or Fixtures? • Photovoltaic panels likely “personalty” and not fixture. • Lenders will take security interest through “security agreement” • Security Interest perfected by filing financing statement

4. Date of execution • Name and address of debtor and creditor • Grant of security interest • Description of the collateral • Obligation(s) secured • Reps and warranties • Covenants • Events of default – acceleration • Rights and remedies • Housekeeping provisions • Signatures Photovoltaic Panels –Personalty or Fixtures? • Well drafted security agreement includes:

5. SRECs • What is an SREC • Solar Renewable Energy Certificate • Tradable certificate represents all clean energy benefits of electricity generated • Can be sold or traded separately from power • Issued once a solar facility has generated 1000 Kwh • Can be listed in SREC bulletin board www.njcep.com/rec

6. SRECs • NJ SREC program • Means for SREC creation and verification • Facilitiates sale of SRECs to electric suppliers required to invest in solar energy under NJ’s Renewable Portfolio Standards (RPS)

7. Collateralizing SRECs • SREC is a general intangible • Security agreement will create a security interest • Security interest perfected by filing a Financing Statement

8. Contact Information Burton J. Jaffe, Esq. 609.895.6630 bjaffe@foxrothschild.com