RESIDENTIAL solar Financing Strategic and legal support in the residential solar space The solar energy MARKET is rapidly expanding. Having the right counsel can be a competitive advantage. The new wave of solar power is on the residential rooftop, using the third-party solar lease or power purchase agreement model, shifting high upfront capital costs from homeowners to third-party investors. New renewable energy equity funds are being created to support the purchase and installation of millions of dollars in residential solar systems across the United States, which, if properly structured, benefit from federal, state, and local tax benefits, as well as other incentives. With large institutions viewing this as a smart, profitable and practical investment, we expect to see a uptick in the pace and number of increasingly, larger-scale residential solar- lease transactions. Nixon Peabody has been an integral part of this burgeoning industry and has led the way in developing key documentation and tax analysis. We regularly appear at industry conferences addressing these structures and we have been pioneers in combining multiple sources of capital in single transactions. Our depth of experience allows us to expeditiously handle residential solar funding projects requiring fast turnaround and to provide outstanding client service. We are one of the nation’s preemi- nent law firms in structuring and closing investments in tax credit and energy transactions, and we understand the complexities of the Energy Investment Tax Credit, cash payment in lieu of energy tax credits, New Market Tax Credits and partnership tax law. We are a leader in helping developers, owners, lenders, and investors leverage available resources to structure these powerful renewable energy tax credits and related tools in creative project financing structures. We have formed— between group investments and proprietary funds—hundreds of funds, with an emphasis on the leading federal syndicated tax credit funds. With an inter-disciplinary team of leading attorneys in the fields of REsidential solaR energy regulatory, project finance, tax credits, consumer law, environmental law, construction, Who We REPRESENT corporate, and real estate, we bring an innovative, market-savvy and proactive approach to our clients. We have experience in representing: Recent residential solar projects › Tax-equity and true equity › Representation of an affiliate of U.S. Bancorp, investors as the initial tax-equity investor in SolarCity’s › Residential solar funds $1-billion SolarStrong initiative to install solar › Project lenders and systems on 120,000 Lend-Lease managed military Holdco lenders housing units, involving complex structuring and forbearance arrangements with Bank of America, › Strategic investors the project’s $350-million lender. › Developers › Representation of affiliates of Morgan Stanley, in › Installers connection with MySolar, a residential solar lease facility with an available $300-million for funding › Parties in factoring receivables solar projects. At the time of closing, this was the and in related M&A transactions largest residential solar financing ever completed Given our high level of activity in the industry. and experience in residential › Representation of Google, in connection with its solar leases, Nixon Peabody $75-million investment in a residential solar fund brings a unique understanding involving Clean Power Finance. and appreciation of the risks and particular legal issues facing each › Representation of Sungevity, in a $50-million party to the transaction. We are residential solar fund financed by Rabobank. known among our clients and our › Representation of an affiliate of U.S. Bancorp, as colleagues in the industry for our tax-equity investor in its $250-million residential collegial and practical approach, solar fund investment involving SolarCity. The using our valuable resources fund will be used to finance leases for solar sys- directly to resolve challenges. tems on homes, businesses, schools, and govern- ment buildings. › Representation of an affiliate of U.S. Bancorp, as tax-equity investor in its $200-million residential solar fund investment involving the solar devel- oper SunRun, to finance rooftop solar arrays for homeowners. › Representation of an affiliate of U.S. Bancorp, as tax-equity investor in its $75-million residential solar fund investment involving Vivint Solar. › Representation of an affiliate of U.S. Bancorp, as tax-equity investor in its $24-million residential solar fund invest- ment involving Sungevity. › Representation of a large financial institution in › Representation of National Bank of Arizona, as connection with a $750-million residential solar tax investor in the acquisition from, and lease to, debt finance facility which is scheduled for a Solar City (and affiliate) of 3.3 MW solar systems 2013 closing. providing electricity to U.S. Air Force base resi- dential housing. The off-take agreement was in the form of a sublease to the privatized entity Renewable energy that developed the housing. Nixon Peabody has an extensive Renewable Energy › Representation of Berkshire Bank, with its invest- practice that includes representing clients in all ment in solar energy tax credits to be generated aspects of the development and financing of many from installations on the rooftops of schools and types of projects, including solar, wind, geothermal, businesses in Massachusetts and Connecticut. waste-to-energy, biomass and biofuel, fuel cells, › Representation of tax-equity investor subsidiary and hydroelectric. We support projects in the U.S., of a CA-based established private equity fund in Puerto Rico, Latin America, and other regions. a $30-million residential solar fund involving Our attorneys are on the cutting edge of develop- Clean Power Finance. ments in the energy industry, not only with regard › Representation of Greystone, as tax-equity to the types of projects with which we have been investor in residential solar projects involving involved, but also with regard to the current laws and SolarCity totaling more than 5 MW using regulatory schemes applicable to the industry. Our lease pass-through structure. lawyers have been involved in financings of renew- able energy projects and manufacturing facilities › Representation of Enterprise Community supported by private industry, the U.S. Department Investment, in structuring a solar tax credit of Energy and various public financing vehicles. In investment fund to finance several community addition, given our government contracting knowl- development projects in California, including a condominium project for affordable housing. edge and experience involving the financing and development of renewable energy projects at mili- › Representation of both the developer and tax- tary installations, we are well-positioned to assist with equity investors in many affordable housing renewable energy projects resulting from the US projects qualifying for both low-income housing Army’s recent $7-billionMultiple Award Task Order and solar credits/grants. Contract Request for Proposals and similar efforts › Representation of a large financial institution in by our military designed to support its shift to renew- connection with a new solar residential financing able power generation. platform with large regional installers that is scheduled for a 2013 roll-out. › Representation of a large financial institution in connection with a new solar residential financing platform with major national energy company which is scheduled for a 2013 roll-out. Top Tax Credit Finance practice Our Tax Credit Finance practice, which is key to our residential solar finance services, is the largest of its kind in the world, and the foremost legal authority in transactions involving tax credit financing—either individually or in combi- nation with other incentives. Deep financing experience We have dozens of finance attorneys, many of whom have been recognized as leaders in their field by publications like Chambers USA. Our internation- ally recognized Project Finance team has closed transactions exceeding Our team: billions of dollars in the U.S. and internationally, and is consistently ranked for professional excellence. We assist our clients in identifying both traditional Gary A. Band 202-585-8809 and specialized sources of capital to provide equity investment and debt [email protected] financing. We often represent lenders active in this sector, where there are frequent delicate negotiations between tax-equity investors and lenders in Richard M. Cogen 212-493-6639 connection with forbearance and other related issues. [email protected] Thomas F. Diorio Comprehensive real estate services 212-940-3145 [email protected] With more than 100 attorneys working in the U.S. and Europe, we have deep experience in virtually all matters related to real estate, including real estate James F. Duffy 617-345-1129 finance, restructuring and workouts, acquisition, securitization and structured [email protected] finance, investment management and asset recovery, and development of commercial real estate. Of particular strength is our knowledge of the capital Ellen S. Friedman 212-940-3053 markets and our ability to assist financial institutions, governmental agencies, [email protected] pension, private equity, and hedge funds, which are all playing greater roles in the real estate market. Our real estate attorneys have a wealth of experi- Aleks S. Frimershtein 213-629-6010