UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
September 28, 2004
Date of Report (Date of earliest event reported)
Millennium Cell Inc.
(Exact name of Registrant as specified in its charter)
Delaware 000-31083 22-3726792
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification Number)
1 Industrial Way West
Eatontown, New Jersey 07724
(Address of principal executive offices)
(732) 542-4000
(Registrant's telephone number, including area code)
(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:
[ ] 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 3.02. Unregistered Sales of Equity Securities
On September 28, 2004, Millennium Cell Inc. (the "Company") exercised
its option under the terms of that certain Securities Purchase Agreement entered
into between the Company and an accredited investor (the "Purchaser") on January
16, 2004, which requires that the Purchaser purchase $4 million aggregate
principal amount of unsecured convertible debentures with an annual interest
rate equal to 6% (the "Additional Debentures"). The terms of the Securities
Purchase Agreement were disclosed in the Company's Form 8-K filed with the
Securities and Exchange Commission ("SEC") on January 21, 2004. In addition to
the sale of the Additional Debentures, the Company issued 60,069 shares of
common stock of the Company, par value $.001 per share (the "Common Stock"), to
the Purchaser for no additional consideration.
The Additional Debentures will be due 18 months from the date of
issuance, subject to six 30 day extensions. The Company is required to pay
interest on the Additional Debentures on a quarterly basis. The Company is
permitted to issue shares of Common Stock to satisfy the interest obligation, if
certain conditions to such issuance are satisfied. Any such shares issued would
be at a discount to the then current market price. The Additional Debentures
provide that the Purchaser will have the option to require prepayment upon the
occurrence of certain standard events of default, including, without limitation,
payment default, bankruptcy, delisting, or the occurrence of a change of control
of the Company.
As a result of the sale of the Additional Debentures, the Company
received net proceeds of $3,828,806 in cash. The remaining balance was paid as a
commitment fee.
The private placement of the Additional Debentures was made in reliance
upon the exemption from registration pursuant to Section 4(2) of the Securities
Act of 1933, as amended, and Rule 506 of Regulation D promulgated thereunder.
The Purchaser is an accredited investor as defined in Rule 501 of Regulation D.
The initial conversion price of the Additional Debentures is equal to
$1.55 (the "Initial Conversion Price"), subject to adjustment for stock splits,
recombinations, certain transactions and similar events. The shares of Common
Stock underlying the Additional Debentures are issuable upon conversion under
three different scenarios: (1) at the option of the holder of the Additional
Debentures at any time, and from time to time, at the Initial Conversion Price;
(2) at the option of the Company any time after the first anniversary of the
original issue date, if the closing price of the Company's common stock during
each of 20 consecutive trading days is equal to or greater than 135% of the
Initial Conversion Price; or (3) at the option of the Company at any time at an
adjusted conversion price equal to the lesser of (i) the Initial Conversion
Price and (ii) the average of the volume weighted average trading price per
share of Common Stock of closing prices for the five prior consecutive trading
days discounted at 7%. The Additional Debentures may not be converted to Common
Stock to the extent that the Purchaser would then beneficially own, together
with its affiliates, more than 9.999% of our Common Stock then outstanding
subsequent to the applicable conversion.
The Company is obligated to register the resale of the Common Stock
issued in the transaction and the Common Stock issuable upon the conversion of
the Additional Debentures on a registration statement on Form S-3 to be filed
with the SEC within 30 days after the closing date of the Additional Debentures.
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Item 9.01. Financial Statements and Exhibits
(c) The following exhibits are filed herewith:
4.1 Unsecured Convertible Debenture No. 2 in aggregate
principal amount of $4 million dated September 28, 2004
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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.
Millennium Cell Inc.
By: /s/ John D. Giolli
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Name: John D. Giolli, CPA
Title: Vice President, Finance and
Acting Chief Financial Officer
Date: September 30, 2004
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