Document:

Exhibit 10.1 - Second Amendment to the Agreement and Plan of Merger

    
      

      

    

    

      SECOND
        AMENDMENT TO THE AGREEMENT AND

      PLAN
        OF MERGER

      

      This
        Second Amendment the Agreement and Plan of Merger (the “Amendment”) is entered
        into as of December 1, 2006 to be effective as of August 23, 2006, by and
        among
        Solar Power, Inc., a California corporation (“SPI”), Solar Power, Inc., a Nevada
        corporation formerly known as Welund Fund, Inc. (the “Company”) and Welund
        Acquisition Corp., a Nevada corporation and a wholly-owned subsidiary of
        the
        Company (the “Merger Sub”). SPI, Company and Merger Sub also collectively
        referred to herein as the “Parties.”

       

      RECITALS

      

      WHEREAS,
        SPI, the Company and the Merger Sub are parties to that certain Agreement
        and
        Plan of Merger dated August 23, 2006, as amended by that certain First Amendment
        to the Agreement and Plan of Merger dated October 4, 2006 (the “Merger
        Agreement”).

      

      WHEREAS,
        the Merger Agreement provides that the “Final Date” (as defined in the Merger
        Agreement) can be extended by mutual consent and the parties have extended
        the
        Final Date to December 23, 2006 by mutual consent on November 30,
        2006.

      

      WHEREAS,
        SPI, the Company and the Merger Sub desire to amend the Merger Agreement
        to
        reflect the extension of the Final Date to December 23, 2006.

      

      WHEREAS,
        SPI, the Company and the Merger Sub also desire to amend to Merger Agreement
        to
        provide for the assumption of SPI’s outstanding stock options by the Company at
        the Effective Time (as defined in the Merger Agreement).

      

      WHEREAS,
        the capitalized terms not otherwise defined herein shall have the meanings
        ascribed to them in the Merger Agreement.

      

      AGREEMENT

      

      NOW,
        THEREFORE, in consideration of the foregoing premises, the mutual agreements
        set
        forth below, and other good and valuable consideration, the receipt and
        sufficiency of which is hereby acknowledged, the parties hereby agree as
        follows:

      

      1. 
          Final
        Date.
        The
        last sentence of Section 10.1 of the Merger Agreement is hereby amended as
        follows:

      

      “As
        used
        herein, the “Final Date” shall be December 23, 2006 or as otherwise extended by
        mutual consent.”

      

      2.    SPI’s
        Stock Option Plan and Options.
        Article
        2 of the Merger Agreement is hereby amended to include a new Section 2.1(b)(v)
        as follows:

      

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      “(v)  At
        the
        Effective Time, each of the then outstanding options to purchase or otherwise
        acquire shares of SPI (“SPI Option”), whether or not such SPI Option is then
        exercisable, issued pursuant to the SPI 2006 Equity Incentive Plan (“SPI Option
        Plan”) or otherwise, will be assumed by the Company (the “Assumed Option”). Each
        Assumed Option shall continue to have, and be subject to, the same terms
        and
        conditions set forth in such option and, if applicable, in the SPI Option
        Plan,
        immediately before the Effective Time, including provisions with respect
        to
        vesting (except as amended to terminate vesting provisions), except that
        each
        Assumed Option will be exercisable for that number of shares of common stock
        of
        the Company, $.0001 par value, equal to the number of shares of SPI common
        stock
        that were issuable upon the exercise of such option immediately before the
        Effective Time. The duration and others terms of each Assumed Options shall
        be
        the same as the original option, including the exercise price for such shares
        which shall also remain the same, provided however, all references to SPI
        shall
        be deemed to be references to the Company.

      

      The
        Company shall take all corporate action necessary to reserve for issuance
        a
        sufficient number of shares of Company’s Common Stock for delivery upon the
        exercise of Assumed Options.” 

       

      
        	 	
                3.

              	
                Exhibits.
                  

              

      

      

      
        	 	
                3.1

              	
                Exhibit
                  A.
                  The definition of Common Stock shall be amended as
                  follows:

              

      

      

      “Common
        Stock”
shall
        mean the issued and outstanding shares of common stock, $.0001, par value,
        of
        the Company”

      

      3.2    Exhibits
        B-1 and B-2.
        The
        Nevada Articles of Merger and the California Agreement of Merger set forth
        as
        Exhibits B-1 and B-2 to the Merger Agreement are hereby amended to conform
        to
        the new Section 2.1(b)(v) set forth above.

      

      
        	 	
                4.

              	
                Disclosure
                  Schedule.
                  

              

      

      

      4.1    Section
        4.3 of SPI Disclosure Schedules is hereby amended to include the disclosures
        set
        forth in the Addendum to Section 4.3 of SPI Disclosure Schedules, attached
        hereto.

      

      
        	 	
                4.2

              	
                Section
                  4.23 of the Merger Agreement is hereby amended as
                  follows:

              

      

      

      “Except
        for the 2006 Equity Incentive Plan, SPI has no other employee benefit plans
        currently in effect.” 

      

      5.    Effect
        of Amendment.
        Except
        as expressly modified by the provisions hereof, the Merger Agreement is in
        all
        respects ratified and confirmed, and shall continue in full force and effect
        in
        accordance with its terms. To the extent that there are any inconsistencies
        between this Amendment and the Merger Agreement, the terms and provisions
        of
        this Amendment shall prevail.

      

      6.    Entire
        Agreement.
        The
        Merger Agreement and this Amendment, including the Addendum to Section 4.3
        of
        SPI Disclosure Schedules, taken as a whole, shall supersede any and all
        agreements, either oral or written, between the Parties with respect to its
        subject matter. 

       

      7.    Counterparts.
        This
        Amendment may be executed in one or more counterparts (including by facsimile)
        each of which when so executed will be deemed an original and all of which,
        when
        taken together, will constitute one and the same agreement. 

      

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      

      IN
        WITNESS WHEREOF, the Parties have executed this Amendment as of the date
        first
        above written.

      

      

      
        	 	
                SOLAR
                  POWER, INC.,
                  a
                  California corporation

                 

              
	 	 
	 	
                By:
                  /s/ Stephen C.
                  Kircher                          
                  

                 

              
	 	
                Name:
                  Stephen
                  C. Kircher

                 

              
	 	
                Title:
                  Chief
                  Executive Officer and Chairman of Board

                 

              
	 	 
	 	
                SOLAR
                  POWER, INC., formerly
                  WELUND FUND, INC., a Nevada corporation

                 

              
	 	 
	 	
                By:
                  /s/ Terrell W.
                  Smith                               
                  

                 

              
	 	
                Name:
                  Terrell
                  W. Smith

                 

              
	 	
                Title:
                  Vice
                  President

                 

              
	 	 
	 	
                WELUND
                  ACQUISITION CORP.,
                  a
                  Nevada corporation

                 

              
	 	 
	 	
                By:
                  /s/ Terrell W.
                  Smith                               
                  

                 

              
	 	
                Name:
                  Terrell
                  W. Smith

                 

              
	 	
                Title:
                  President

              

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      ADDENDUM
        TO 

      SECTION
        4.3 TO 

      SPI
        DISCLOSURE SCHEDULES

      

      

      (a)    Options.
        SPI has
        reserved 2,000,000 shares of its common stock under its 2006 Equity Incentive
        Plan. SPI intends to grant options to purchase up to 2,000,000 shares of
        its
        common stock prior to the Effective Time. SPI will provide a complete list
        of
        the options granted by SPI prior to the Closing. Such list will contain the
        names of the optionee, the number of shares exercisable by the respective
        optionees under each option grant, and the exercise price. 

      

      (b)    Reserved
        Stock.
        SPI has
        reserved an aggregate of 500,000 shares of common stock which were to be
        issued
        to Dale Renewables Consulting, Inc., (“DRCI”) in connection with the merger with
        DRCI and SPI. Although, no shares of common stock were issued to DRCI in
        connection with the merger, SPI may issue such shares prior to the Effective
        Time of Merger. Any and all stock issuances will be reflected in the Merger
        Certificate to be delivered at the Closing.

      

      
 

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

      4Exhibit 10.1

 

DLJ MB IV HRH, LLC

Eleven Madison Avenue, 16th Floor

New York, New York
10010

December 1, 2006

Morgans Hotel
Group

475 Tenth Avenue

New York, New York
10018

Attn:  David
Smail

Re:          Financing
Waiver Date

Dear Mr. Smail:

Reference is hereby made to that certain Contribution
Agreement dated as of November 7, 2006 (as amended on November 20, 2006, November
22, 2006, November 28, 2006, November 29, 2006 and November 30, 2006, the ”Contribution
Agreement”) by and among DLJ MB IV HRH, LLC (“DLJMB”) and Morgans
Hotel Group Co. (“Morgans”). 
Capitalized terms used but not defined herein have the meanings given to
them in the Contribution Agreement.

This letter is to confirm our agreement that, for all
purposes under the Contribution Agreement, the Financing Waiver Date shall be
extended from 5:00 p.m. Eastern Standard Time on Friday, December 1, 2006 to the
earlier of (a) 5:00 p.m. Eastern Standard Time on Saturday, December 2, 2006;
and (b) such time as DLJMB and Morgans shall have entered into an amendment and
restatement of the Contribution Agreement in a form mutually acceptable to such
parties.

This letter supersedes any prior agreements relating
to the subject matter hereof, and shall be deemed to be effective as of 4:59 p.m.
Eastern Standard Time on Friday, December 1, 2006.

Please acknowledge that the foregoing conforms to
Morgans’ understanding with respect to the extension of the Financing Waiver
Date, by signing this letter below and returning it to DLJMB.

 

This letter may be executed in any number of
counterparts, each of which when executed and delivered shall be deemed to be
an original and all of which counterparts taken together shall constitute one
and the same instrument.

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  DLJ MB IV HRH,
  LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Steven
  Rattner

  	
   

  
	
   

  	
   

  	
  Steven Rattner

  
	
   

  	
   

  
	
   

  	
   

  
	
  Agreed to and
  Acknowledged as of

  	
   

  
	
  December 1,
  2006:

  	
   

  
	
   

  	
   

  
	
  Morgans Hotel
  Group Co.

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ W. Edward Scheetz

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  cc:           Stephen
  G. Gellman, Esq.

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