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 17, 2004
NCT Group, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 0-18267 59-2501025
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
20 Ketchum Street, Westport, CT 06880
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code: (203) 226-4447
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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:
|_| 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 1.01. Entry into a Material Definitive Agreement.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
Item 3.02. Unregistered Sales of Equity Securities.
On December 17, 2004, NCT Group, Inc. ("NCT") issued Carole Salkind an 8%
convertible note in the principal amount of $400,000, for which Ms. Salkind paid
NCT $400,000 in cash. The note is secured by substantially all of the assets of
NCT. The note matures on June 17, 2005. The note bears interest at 8% per annum
until the due date of the note, and bears interest at a default rate of 13% on
any amount of principal or interest that is not paid when due. Interest is
payable on June 17, 2005. At the election of Ms. Salkind, the note may be
converted into 24,096,386 shares of NCT common stock at a conversion price per
share of $0.0166 or exchanged for shares of common stock of any subsidiary of
NCT (except Pro Tech Communications, Inc.) that makes a public offering of its
common stock (at the public offering price). The note contains events of
default, any one of which (if not cured) triggers a default penalty of 10% of
the then outstanding principal. If triggered, the default penalty, along with
the outstanding principal and accrued interest, becomes immediately due and
payable. Events of default include the failure to pay principal and interest
when due and the failure to issue shares of common stock upon exercise of
conversion rights.
In conjunction with this note issuance, NCT issued Ms. Salkind a five-year
warrant to acquire 6,750,000 shares of NCT common stock at an exercise price per
share of $0.0166.
The issuance of the note and warrant was not registered under the Securities Act
of 1933, as amended, in reliance upon the exemption set forth in Section 4(2) of
the Securities Act relating to transactions by an issuer not involving a public
offering.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits
4.1 Warrant dated December 17, 2004 issued to Carole Salkind for the
purchase of 6,750,000 shares of NCT common stock at a purchase price
of $0.0166 per share.
10.01 Secured Convertible Note in principal amount of $400,000 dated
December 17, 2004 issued by NCT to Carole Salkind.
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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.
NCT GROUP, INC.
By: /s/ Cy E. Hammond
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Cy E. Hammond
Senior Vice President and
Chief Financial Officer
Date: December 23, 2004
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