UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date
of
Report (Date of earliest event reported): May 13, 2008
NEW
GENERATION BIOFUELS HOLDINGS, INC.
(Exact
Name of Registrant as Specified in Charter)
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Florida
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000-51903
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26-0067474
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(State
or other jurisdiction of incorporation)
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(Commission
File Number)
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(IRS
Employer Identification No.)
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11111
Katy Freeway, Suite 910 Houston, Texas 77079
(Address
of principal executive offices)(Zip Code)
(713)
973-5720
(Registrant’s
telephone number, including area code)
N/A
(Former
Name or former address, if changed since last report.)
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14-12)
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
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o
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Pre-commencement
communications pursuant to Rule 1 3-e-4(c) under the Exchange Act
(17 CFR
240.1 3e-4(c))
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Item
3.02. Recent Sales of Equity Securities.
On
May
13, 2008, New Generation Biofuels Holdings, Inc., a Florida corporation (the
“Company” or “we”), completed a second closing of its private placement of 8%
Series B Cumulative Convertible Preferred Stock, par value $0.001 per share
(the
“Series B Preferred Stock”), and warrants to purchase common stock to investors
who qualify as “accredited investors” as defined under the Securities Act of
1933, as amended (the “Securities Act”). In this second closing, we
sold 35,123 shares of our Series B Preferred Stock at a price of $100.00
per share and five-year warrants to purchase 208,345 shares of our common
stock at an exercise price of $6.25 per share (the “May Offering”). The gross
proceeds from the May Offering were $3,512,300 excluding shares and warrants
issued as commissions. In summary, in the offering that we closed on March
31,
2008 and May 13, 2008, we sold a total of 75,891 shares of our Series B
Preferred Stock and warrants to purchase 446,413 shares of our common stock
for total gross proceeds of $7,589,100.
The
May
Offering was exempt from registration under the Securities Act in accordance
with Section 4(2) under the Securities Act and Rule 506 promulgated thereunder.
The sale was made pursuant to subscription agreements between the Company and
each investor.
A
summary
of key terms of the May Offering is provided below and is qualified in its
entirety by reference to our Articles of Amendment to our Amended and Restated
Articles of Incorporation (filed as Exhibit 3.2 to the Current Report on Form
8-K filed with the Securities Exchange Commission on March 31, 2008), the
warrants and other offering documents:
Series
B Convertible Preferred Stock.
Each
share of Series B Preferred Stock initially will be convertible into shares
of
our common stock, par value $0.001 per share (“Common Stock”), at a conversion
price of $4.25 per share. The Series B Preferred Stock also include the
following key terms that are summarized below but qualified in their entirety
by
reference to the preferred stock designations included in the Company’s Articles
of Amendment to :
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·
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Ranking.
The
Series B Preferred Stock will rank junior to the Series A Preferred
Stock
and senior to the Common Stock with respect to the payment of dividends
and amounts payable upon liquidation, dissolution or winding up of
the
Company.
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·
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Dividends
and Increase in Stated Value.
Dividends
will be payable from the date of issuance at a rate of 8% per year
when
and as declared by the Board of Directors. To the extent that dividends
are not declared, or cannot be paid, there will be an increase in
the
Stated Value of the Series B Preferred Stock in the amount of 8%
per year.
In the event dividends are declared by the Board and paid by the
Company
on the Common Stock, holders of
Series
B Preferred Stock
will
either share ratably in such dividends based on the number of shares
of
Common Stock into which the
Series
B
Preferred
Stock may be converted or (to the extent that dividends are not declared
or cannot be paid), there will be a corresponding increase in the
Stated
Value. Dividends will be paid semiannually, at the Company’s election, in
cash, in shares of Series B Preferred Stock (valued at Stated Value)
or in
Common Stock valued at the market price, on September 30 and March
31 of
each year beginning on September 30, 2008 to holders of record on
the
15
th
day of the preceding month. If there is an increase in Stated Value
because dividends were not or could not be paid, that increase will
occur
semiannually on the dates that dividends would have been paid.
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·
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Liquidation.
Upon
any Liquidation of the Company, after the Company has made the required
distributions to the holders of Series A Preferred Stock (and any
other
preferred stock then outstanding, if any, ranking in liquidation
senior to
the Series B Preferred Stock), and before any distribution is made
to the
holders of Common Stock (and any other stock ranking in liquidation
junior
to the Series B Preferred Stock), the holders of Series B Preferred
Stock
will be entitled to be paid an amount in cash equal to the aggregate
liquidation value of Series B Preferred Stock, which equals the Stated
Value plus all accrued dividends not previously paid or added to
Stated
Value.
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·
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Redemption.
The
Series B Preferred Stock is not
redeemable.
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·
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Voting.
The
holders of the Series B Preferred Stock will be entitled to notice
of all
shareholders’ meetings and will be entitled to vote on all matters
submitted to the shareholders for a vote, together with the holders
of
Series A Preferred Stock on an as-converted basis and the Common
Stock,
voting together as a single class. Each share of Series B Preferred
Stock
will be entitled to one vote for each share of Common Stock issuable
upon
conversion of the Series B Preferred Stock as of the record date
for such
vote or, if no record date is specified, as of the date of such
vote.
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·
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Automatic
Conversion.
Upon
the third anniversary of the initial issue date of the Series B Preferred
Stock, each share of Series B Preferred Stock will automatically
convert
into the number of shares of Common Stock into which it is then
convertible. That number is determined by dividing the sum of the
Stated
Value and all accrued dividends not previously paid or added to the
Stated
Value to the date of such conversion by the Conversion Price then
in
effect. The conversion price is $4.25 per share, subject to adjustment
upon the occurrence of certain major corporate events such as
reorganizations and stock splits (the “Conversion
Price”).
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·
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Optional
Conversion.
At
any time, any holder of Series B Preferred Stock may convert all
or a
portion of their shares. The number of shares of Common Stock into
which
each share of Series B Preferred Stock is convertible is determined
by
dividing the sum of the Stated Value and all accrued dividends not
previously paid or added to the Stated Value to the date of such
conversion by the Conversion Price then in
effect.
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·
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Antidilution
and Adjustments to Conversion Price.
If
at any time prior to the first to occur of (i) the first anniversary
of the registration of the common stock underlying the Series B Preferred
Stock or (ii) 18 months after the closing , the Company issues any
additional shares of Common Stock with a purchase price less than
the
Conversion Price of the Series B Preferred Stock, or additional
convertible securities with a conversion price less than the
Conversion
Price
of
the Series B Preferred Stock, the Conversion Price of the Series
B
Preferred Stock will be reduced to the purchase price at which such
Common
Stock has been issued or the conversion price of such additional
convertible securities, but not below a Conversion Price of $3.00
per
share.
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Protective
Provisions.
The
Company will not, without approval of a majority of the holders of
the
shares of the Series B Preferred Stock voting as a separate
class;
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(a)
alter
or
change the rights, preferences or privileges of the Series B Preferred Stock
or
any other class or series of preferred stock in any manner adversely affecting
the rights of the Series B Preferred Stock;
(b)
create
or
issue any new class or series of equity securities of the Company having a
preference senior to the Series B Preferred Stock with respect to redemption,
voting, liquidation or dividend rights;
(c)
pay
or
declare any dividend on or other distribution with respect to any shares of
the
Company’s capital stock which are junior to the Series B Preferred Stock (except
dividends payable solely in shares of Common Stock or in the junior preferred
stock); or
(d)
redeem
or
acquire any shares of the Company’s capital stock which are junior to the Series
B Preferred Stock (other than Common Stock from employees, officers or directors
of the Company or its subsidiaries upon termination of employment pursuant
to
the terms of agreements approved by the Company’s board of directors or Common
Stock from any affiliate of the Company (which for this purpose shall include
any holder of 10% or more of the Common Stock or other voting stock of the
Company) or any strategic partner of the Company).
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Reorganization,
Consolidation, Merger or Sale.
Prior
to any recapitalization, reorganization, reclassification, consolidation,
merger, sale of all or substantially all of the Company’s assets or other
transaction where the holders of Common Stock are entitled to receive
(either directly or upon subsequent liquidation) stock, securities
or
assets with respect to or in exchange for Common Stock (an “
Organic
Change
”),
the Company will make appropriate provision to ensure that the holders
of
Series B Preferred Stock will have the right to acquire and receive,
upon
the conversion of Series B Preferred Stock, , in lieu of Common Stock,
such shares of stock, securities or assets as such holder would have
received in connection with such Organic Change if such holder had
converted its Series B Preferred Stock immediately prior to such
Organic
Change.
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Warrants.
Each
investor in the May Offering will also receive warrants exercisable for a number
of shares of our Common Stock equal to 25% of the number of shares of common
stock that would be issuable upon initial conversion of the Series B Preferred
Stock. The initial exercise price of the warrant is $6.25 per share. The
warrants are exercisable at any time after the six month anniversary of the
issue date but prior to the fifth anniversary of the issue date. If at any
time
prior to the first anniversary of the registration of the common stock
underlying the warrants or eighteen months from the date of closing, the Company
issues certain additional equity securities with a purchase price or conversion
price less than $4.25 per share of Common Stock or any additional warrantswith
an exercise price less than $6.25 per share, the exercise price of the Warrant
will be reduced to the purchase price or the conversion price of the additional
equity securities or to the exercise price of the additional warrants, but
not
below $3.00 per share.
The
antidilution adjustments in the Series B Preferred Stock and warrants will
not
apply to certain issuances of equity securities or warrants, including those
not
issued in capital-raising transactions (such as to customers, suppliers, joint
venture partners or in connection with acquisitions of property) or in
connection with equity award or options granted by the Company to employees,
consultants and directors under employee benefit plans approved by the Board
of
Directors under which options generally are granted with exercise prices at
least equal to the Company’s stock price on the grant dates.
Registration
Rights.
In
connection with the May Offering, we agreed to register the resale of the
shares of common stock issuable to investors upon conversion of the Series
B
Preferred Stock, upon the exercise of any warrants and as may be issued or
distributed through a stock dividend or stock split or other distribution,
recapitalization or reclassification. Under the registration rights agreements
with each investor, we are required to file a “resale” registration statement
with the SEC covering such shares on or before the 30th day following the
closing date. We are obligated to maintain the effectiveness of the “resale”
registration statement from the effective date of the registration statement
through and until the shares have been disposed of in accordance with the
registration statement, the shares have been distributed to the public or could
be sold by the investor pursuant to Rule 144 under the Securities Act, or the
shares have ceased to be outstanding. We agreed to use our reasonable best
efforts to have the “resale” registration statement declared effective by the
SEC as promptly as practicable after the initial filing, but by no later than
180 days after the effective date. If we fail to meet these registration
obligations, we may be required to pay a penalty in cash or additional shares
of
our common stock, at our election, to investors in the May Offering, in an
amount not to exceed 6.0% of the aggregate purchase price of the Series B
Preferred Stock purchased in the May Offering.
Commissions
and Fees.
For
the
May Offering we agreed to pay a cash commission of 8% of the total proceeds
and
a warrant commission of 10% of the total number of shares purchased in the
May
Offering. Some of our finders chose to participate in the May Offering by
investing a portion of their cash commission on the same terms as other
investors. Ultimately, we
paid commissions of $249,288 in cash, issued
296 shares of our Series B Preferred Stock and issued warrants to
purchase 83,783 shares of our common stock, on the same terms as
issued to the investors in the May Offering.
For
the
round of financing we closed on March 31, 2008 (the “March Offering”) we issued
3,218 shares of our Series B Preferred Stock and warrants to purchase 113,654
shares of our common stock. In total, for the March Offering and the May
Offering, we paid commissions of $249,288 in cash, issued 3,514 shares of our
Series B Preferred Stock and warrants to purchase 197,437 shares of our common
stock to Empire Financial Group, William Corbett, Michael Jacks and Dennis
Lavelle for services as finders in connection with the
transactions.
Item 9.01
Financial Statements and Exhibits
(d)
Exhibits
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3.1
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Amended
and Restated Articles of Incorporation (filed as Exhibit 3.1 to the
Current Report on Form 8-K filed March 31, 2008 and incorporated
herein by
reference).
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3.2
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Articles
of Amendment to the Amended and Restated Articles of Incorporation
(filed
as Exhibit 3.2 to the Current Report on Form 8-K filed March 31,
2008 and
incorporated herein by reference).
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4.1
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Form
of $6.25 Warrant (filed as Exhibit 4.1 to the Current Report on Form
8-K
filed March 31, 2008 and incorporated herein by
reference).
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10.1
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Form
of Subscription Agreement (filed as Exhibit 10.1 to the Current Report
on
Form 8-K filed March 31, 2008 and incorporated herein by
reference).
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10.2
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Form
of Registration Rights Agreement (filed as Exhibit 10.2 to the Current
Report on Form 8-K filed March 31, 2008 and incorporated herein by
reference).
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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NEW
GENERATION BIOFUELS HOLDINGS, INC.
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By:
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/s/
David A. Gillespie
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David
A. Gillespie
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President
and Chief Executive Officer
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Date:
May
13, 2008
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