U.S. 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 Act of 1934
Date of Report (Date of earliest event reported): June 9, 2006
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HIENERGY TECHNOLOGIES, INC.
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(Exact name of registrant as specified in its charter)
DELAWARE 0 - 32093 91-2022980
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(State or other (Commission (I.R.S.
jurisdiction File Number) Identification No.)
of incorporation)
1601-B ALTON PARKWAY, UNIT B
IRVINE, CALIFORNIA 92606
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (949) 757-0855
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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))
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HiEnergy Technologies, Inc. ("we", "us" or the "Company") files this report on
Form 8-K to report the following:
Item 1.01 Entry into a Material Definitive Agreement
On June 9, 2006, the Company entered into a Confidential Settlement Agreement
and Mutual Release with a former consultant, Yeffet Security Consultants, Inc.,
("YSCI"), and YSCI's beneficial owner, Isaac Yeffet. The Settlement Agreement
provided for a mutual reconciliation of disputes between the parties which were
in binding arbitration proceedings. As part of the Settlement Agreement, YSCI
released the Company from all claims to recover the $449,540,91 which YSCI was
seeking for allegedly breaching a consulting agreement. YSCI also forfeited its
options to purchase up to 1,000,000 shares of Company common stock.
Pursuant to the terms of the Settlement Agreement, the Company is required to
make cash payments to YSCI as follows: (i) $27,000, which is payable within 15
business days following the execution of the Settlement Agreement, (ii)
$36,540,91, representing accrued and unpaid services and expenses incurred in
2003, and (iii) $153,000. Excluding the amount of the above-mentioned cash
payment of $27,000, all amounts are due 150 days following the execution of the
Settlement Agreement together with simple interest of 8% per annum on any unpaid
balance accruing from the execution of the Settlement Agreement until full
payment, provided that the Company has an additional 30-day cure period to pay
this debt if needed. Any unpaid amounts become immediately due upon receipt by
the Company of investment in an aggregate amount greater then $2,500,000.
Pursuant to the terms of the Settlement Agreement, the Company is obligated to
issue 775,000 shares (the "Settlement Shares") of the Company's common stock to
Isaac Yeffet within 60 days of the execution of the Settlement Agreement. The
Settlement Shares have "piggyback registration rights" obligating the Company to
include the shares on the next qualifying registration statement filed by the
Company with the SEC. Beginning on November 1, 2006, during each month that
Isaac Yeffet cannot sell his shares pursuant to an effective registration
statement or pursuant to Rule 144, Mr. Yeffet may require the Company to
repurchase up to $20,000 in Settlement Shares per month at a price per share of
$0.33.
In the event the Company breaches its obligations of the Settlement Agreement
relating to the payment of money or the issuance of shares, YSCI, after
providing the Company with written notice and allowing the Company with 5
business days to cure any such breach, may have the arbitrator enter a judgment
for the unpaid balance of the cash payments plus the cash value of any
undelivered stock (valued at $0.33 per share).
A copy of the Settlement Agreement is filed as Exhibit 10.151 to this Current
Report.
Item 9.01 Financial Statements and Exhibits.
10.151 Confidential Settlement Agreement and Mutual Release, dated June 9, 2006.
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SIGNATURES:
Pursuant to the requirement 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.
HIENERGY TECHNOLOGIES, INC.
June 15, 2006 By: /s/ Roger W.A. Spillmann
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(Date) Name: Roger W.A. Spillmann,
President, CEO and Treasurer
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