- Current report filing (8-K)
December 19 2008 - 2:35PM
Edgar (US Regulatory)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 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):
December 15,
2008
ENERGY
COMPOSITES CORPORATION
(Exact
name of registrant as specified in its charter)
|
Nevada
|
|
000-52397
|
|
88-0409170
|
|
(State
or other jurisdiction of incorporation)
|
|
(Commission
File Number)
|
|
(IRS
Employer Identification No.)
|
4400
Commerce Drive, Wisconsin Rapids, WI 54494
(Address
of principal executive offices) (Zip Code)
(715)
421-2060
Registrant’s
telephone number, including area code
Not
applicable
(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):
¨
Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
¨
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
|
Item
2.03
|
Creation
of a Direct Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement of a
Registrant.
|
On
December 15, 2008, Energy Composites Corporation (the “
Company
”) closed its
private offering of units (the “
Units
”) raising a
total of $6,370,000. Each Unit sold consisted of a 3-year, 6%
convertible debenture (the “
Debentures
”) with a
conversion price of $2.50 (the “
Conversion Price
”)
per share, and (ii) a number of warrants (the “
Warrants
”)
exercisable into shares of the Company’s common stock equal to the number of
shares issuable upon conversion of the principal amount of the
Debenture. The Company issued Debentures with a face amount of
$6,370,000 and Warrants exercisable into 2,548,000 shares of common
stock.
The
Company sold Units to 75 accredited investors. The Company did not
pay any commissions on the sale of the Units and no underwriters were
used. The Company relied upon the exemption from registration
contained in Section 4(2) and/or Rule 506 as to the sale of the Units, as the
investors were deemed to be sophisticated with respect to the investment in the
Units due to their financial condition and involvement in the Company’s business
or were accredited investors. Restrictive legends were placed on the
Debentures and Warrants.
Terms of
the Debentures
: Each Debenture matures 3 years from issuance
(the “
Maturity
Date
”) and accrues interest at 6% per annum. Interest on the
Debentures is payable in cash or in shares of the Company’s common stock at
$2.50 per share, in twelve quarterly installments on April 1, July 1, October 1,
and January 1 until the principal amount and all accrued and unpaid interest
shall have been paid in full on the Maturity Date.
The
Company has the option to prepay the Debentures, in whole or in part, after the
expiration of one year from the date of issuance of each Debenture but prior to
the Maturity Date. The Company can prepay without penalty or premium
so long as all of the following conditions have been met: (i) the Company’s
common stock has traded above the Conversion Price for at least twenty
consecutive trading days immediately preceding the Company’s notice of its
election to prepay; (ii) the average trading volume shall be at least one
hundred thousand shares per day during such twenty consecutive day trading
period; and (iii) the shares of common stock issuable upon conversion of the
Debentures shall be eligible for resale pursuant to Rule 144 under the
Securities Act of 1933.
The
principal balance of the Debentures is convertible into shares of the Company’s
common stock at the option of the Holder at the Conversion Price. The
Company has the option to convert the Debentures provided that all of the
conditions required for prepayment of the Debentures have been
met. The Debentures provide anti-dilution protection (adjustment of
the Conversion Price) for the following events: reorganization,
reclassification, consolidation, merger or sale; stock split, stock dividend,
reverse stock split, or other issuance of the Company’s common
stock.
Terms of
the Warrants
: Each Warrant is exercisable into shares of
common stock for a term of 3 years at $5.00 per share (the “Exercise
Price”). The Company has the option to compel the exercise of the
Warrants, in whole or in part. The Company can force the exercise of
the Warrants so long as all of the following conditions have been met: (i) the
Company’s common stock has traded above the Exercise Price for at least twenty
consecutive trading days immediately preceding the Company’s notice of mandatory
exercise; (ii) the average trading volume shall be at least one hundred thousand
shares per day during such twenty consecutive day trading period; and (iii) the
shares of common stock issuable upon exercise of the Warrants shall be eligible
for resale pursuant to Rule 144 under the Securities Act of 1933.
The
Warrants also provide anti-dilution protection (adjustment of the Exercise
Price) for the following events: reorganization, reclassification,
consolidation, merger or sale; stock split, stock
2
dividend,
reverse stock split, other issuance of the Company’s common stock; or the
issuance of new warrants.
Item
3.02 Unregistered
Sales of Equity Securities.
The
disclosure set forth in Item 2.03 of this report is incorporated herein by
reference
Item
9.01 Financial
Statements and Exhibits
|
Regulation
S-K
Number
|
Document
|
|
10.1
|
Form
of Debenture
|
|
10.2
|
Form
of Warrant
|
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.
|
|
ENERGY
COMPOSITES CORPORATION
|
|
December
19, 2008
|
By:
/s/ Samuel W.
Fairchild
|
|
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Samuel W.
Fairchild
|
|
|
Chief Executive
Officer
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Exhibit
Index
|
Regulation
S-K
Number
|
Document
|
|
10.1
|
Form
of Debenture
|
|
10.2
|
Form
of Warrant
|
3
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