PHILADELPHIA, March 6, 2019 /PRNewswire/ -- In December 2015, Pardee Resources Company (OTC: PDER) (the "Company") invested $7.7 million in a limited partnership that purchased mobile solar generators from DC Solar Solutions, Inc. ("DC Solar") and, in turn, leased the generators to DC Solar Distribution, Inc., an affiliate of DC Solar. The Company recently learned through public sources that the government seized substantially all of the assets of DC Solar and its affiliates in December 2018. DC Solar and its affiliates, including our lessee, subsequently filed for Chapter 11 bankruptcy protection in February 2019. An affidavit from a Federal Bureau of Investigation special agent was filed in February 2019 asserting that DC Solar was operating a fraudulent "Ponzi-like scheme" and that a majority of the mobile solar generators sold to investors and a majority of the lease revenues claimed to have been received by DC Solar Distribution, Inc. may not have existed.
The Company is fully engaged in gathering additional information regarding this developing situation. Currently, the extent to which the Company's partnership may be able to recover the related assets remains uncertain. Although the Company currently is unable to determine the financial impact, if any, arising from this situation, it could be as much as its investment of $7.7 million. In connection with this investment, the Company had previously recognized $5.6 million of renewable energy investment tax credits, as well as other tax benefits, part or all of which could be reversed.
"While of great concern, we believe this is an isolated situation and that the Company's other solar investments remain sound," said Carleton P. Erdman, President and Chief Executive Officer.
In addition to historical statements, this press release contains statements relating to future events and our future results. These statements are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995, and include statements that relate to the impact of the developing situation described above. While these forward-looking statements represent our judgments and future expectations concerning our business, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from our expectations. These factors include, but are not limited to: difficult economic conditions, the scope of the fraud alleged to have been conducted by DC Solar, and other risks and uncertainties. As a result, these forward-looking statements may turn out to be incorrect. We are under no obligation to (and expressly disclaim any obligation to) update or alter these forward-looking statements whether as a result of new information, future events or otherwise.
SOURCE Pardee Resources Company