Item 3.02. Unregistered Sales of Equity Securities.
As previously reported, on April 9, 2018, Real Goods Solar,
Inc. (the “Company”) issued an aggregate of $10.75 million in principal amount and $10 million funding amount (reflecting
an original issue discount of $750,000) of Series A senior convertible notes due April 9, 2019 (the “Series A Notes”)
and Series B senior secured convertible notes due April 9, 2019 (the “Series B Notes” and, together with the Series
A Notes, collectively, the “2018 Notes”). The 2018 Notes are convertible at any time, at the option of the holders,
into shares of the Company’s Class A common stock. The Company previously reported the conversion features and terms of the
2018 Notes in its Current Report on Form 8-K filed on April 2, 2018 and these descriptions are incorporated herein by reference.
On August 8, 2018, holders of Series A Notes converted an aggregate
principal amount of $500 into 1,551 shares of the Company’s Class A common stock. On August 8, 2018, holders of Series B
Notes converted an aggregate principal amount of $7,000 into 21,719 shares of the Company’s Class A common stock. On August
8, 2018, holders of Series A Notes converted an aggregate Additional Amount (as defined in the Series A Notes) of $48,500 into
150,481 shares of the Company’s Class A common stock. On August 8, 2018, holders of Series B Notes converted an aggregate
Additional True-Up Amount (as defined in the Series B Notes) of $168,000 into 521,253 shares of the Company’s Class A common
stock. On August 9, 2018, holders of Series B Notes converted an aggregate principal amount of $1,000 into 3,103 shares of the
Company’s Class A common stock. On August 9, 2018, holders of Series B Notes converted an aggregate Additional True-Up Amount
(as defined in the Series B Notes) of $24,000 into 74,465 shares of the Company’s Class A common stock. On August 10, 2018,
holders of Series B Notes converted an aggregate principal amount of $1,000 into 3,103 shares of the Company’s Class A common
stock. On August 10, 2018, holders of Series B Notes converted an aggregate Additional True-Up Amount (as defined in the Series
B Notes) of $24,000 into 74,465 shares of the Company’s Class A common stock. On August 13, 2018, holders of Series A Notes
converted an aggregate principal amount of $500 into 1,551 shares of the Company’s Class A common stock. On August 13, 2018,
holders of Series B Notes converted an aggregate principal amount of $3,000 into 9,308 shares of the Company’s Class A common
stock. On August 13, 2018, holders of Series A Notes converted an aggregate Additional Amount (as defined in the Series A Notes)
of $48,500 into 150,481 shares of the Company’s Class A common stock. On August 13, 2018, holders of Series B Notes converted
an aggregate Additional True-Up Amount (as defined in the Series B Notes) of $72,000 into 223,394 shares of the Company’s
Class A common stock. On August 17, 2018, holders of Series A Notes converted an aggregate principal amount of $200 into 621 shares
of the Company’s Class A common stock. On August 17, 2018, holders of Series A Notes converted an aggregate Additional Amount
(as defined in the Series A Notes) of $16,000 into 49,643 shares of the Company’s Class A common stock. On August 27, 2018,
holders of Series B Notes converted an aggregate principal amount of $5,000 into 16,303 shares of the Company’s Class A common
stock. On August 27, 2018, holders of Series B Notes converted an aggregate Additional True-Up Amount (as defined in the Series
B Notes) of $245,000 into 798,826 shares of the Company’s Class A common stock. On August 28, 2018, holders of Series B Notes
converted an aggregate principal amount of $2,000 into 6,521 shares of the Company’s Class A common stock. On August 28,
2018, holders of Series B Notes converted an aggregate Additional True-Up Amount (as defined in the Series B Notes) of $98,000
into 319,530 shares of the Company’s Class A common stock.
As previously reported, the issuance of the shares of Class
A common stock upon conversion of the 2018 Notes was exempt from registration under Section 4(a)(2) of the Securities Act of 1933,
as amended (the “Securities Act”), and Securities Act Rule 506(b). The holders of the 2018 Notes are sophisticated,
accredited investors and acquired the securities for their own accounts for investment purposes. Further, the transaction documents
pursuant to which the holders purchased the 2018 Notes state that the securities in question have not been registered under the
Securities Act and cannot be sold or otherwise transferred without registration or an exemption therefrom and provide for the placement
of a restrictive legend on any stock certificates issued upon conversion of the 2018 Notes, subject to the terms of the transaction
documents.
As required under the Registration Rights Agreement, dated April
9, 2018, that the Company entered into with the holders of the 2018 Notes (the “Registration Rights Agreement”), on
April 27, 2018, the Company filed a registration statement on Form S-3 (the “Registration Statement”) with the Securities
and Exchange Commission (the “SEC”) covering the resale of the shares of Class A common stock issuable under the 2018
Notes and the Series Q warrants issued in connection with the issuance of the 2018 Notes (the “Series Q Warrants”).
The SEC declared the Registration Statement effective on May 4, 2018.
As described below, effective on August 27, 2018, the conversion
price for the 2018 Notes was reduced to $0.3067 per share and, effective on August 29, 2018, the 2018 Note holders waived any future
resets of the conversion price of the 2018 Notes and the exercise price of the Series Q Warrants (but the conversion price and
exercise price remain subject to potential future anti-dilution and stock split related adjustments). As of August 28, 2018, an
aggregate of $14,110,122.28 remains outstanding under the 2018 Notes. As a result, at the current $0.3067 conversion price, the
maximum number of shares of Class A common stock issuable upon conversion of the 2018 Notes is 46,006,268. If the amount outstanding
under the 2018 Notes increases in the future, for example as a result of the 2018 Notes accruing default interest or Late Charges
(as defined in the 2018 Notes), or the conversion price of the 2018 Notes is decreased under their terms, additional shares of
Class A common stock will become issuable under the 2018 Notes.