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)
November 22, 2004
EC POWER, INC.
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 000-32365 91-162385
(State or Other (Commission File Number) (IRS Employer
Jurisdiction of Incorporation) Identification Number)
41 WATCHUNG PLAZA, #386, MONTCLAIR, NEW JERSEY 07042
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code 212-399-6682
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 1.01 Entry into a Material Definitive Agreement
On November 16, 2004, EC Power, Inc., a Delaware corporation (the
"Company"), entered into an Agreement and Plan of Merger (the "Merger
Agreement"), dated November 16, 2004, with FBC Technologies, Inc., a New York
corporation ("FBC") and EC Power Acquisition Corp., a New York corporation
("Merger Sub"), and a wholly owned subsidiary of the Company. Pursuant to the
Merger Agreement, Merger Sub merged with and into FBC, with FBC surviving as a
wholly owned subsidiary of the Company (the "Merger").
The purchase price for the acquisition was one million (1,000,000) shares
of the Company's common stock, par value $.001 per share (the "EC Power Common
Stock") to be issued to the stockholders of FBC and five-year warrants to
purchase, at the per share Warrant Exercise Price (as defined below), an
aggregate total of one million five hundred thousand (1,500,000) shares of EC
Power Common Stock to be issued to the warrantholders of FBC (collectively, the
"Purchase Price"). The per share warrant exercise price is equal to the lesser
of (i) Four Dollars and Fifty Five Cents ($4.55) per share and (ii) eighty five
percent (85%) of the average of the three lowest closing bid prices for EC Power
Common Stock for the ten trading days ending on the close of business on the day
before the relevant warrant is exercised (the "Warrant Exercise Price");
provided, however, that in no event will the per share Warrant Exercise Price of
such warrant be below (i) Two Dollars ($2.00) if such warrant is exercised prior
to November 16, 2005, or (ii) Three Dollars ($3.00) if such warrant is exercised
at any time thereafter until such warrant expires.
In addition to the Purchase Price, in the Merger Agreement the Company
agreed to issue an additional one million (1,000,000) shares of EC Power Common
Stock to the FBC stockholders if the Company was not compliant with its filings
under the Securities and Exchange Act of 1934, as amended, by June 30, 2005.
In the Merger Agreement, the Company also agreed to use its best efforts
to replace certain guaranties provided by certain FBC stockholders (the
"Guarantors"). If the guaranties are not removed within six months of November
16, 2004, EC Power has agreed to issue to the Guarantors whose guaranties are
still in place five-year warrants to purchase such number of shares determined
by dividing the amount of debt guaranteed by such Guarantors as of May 16, 2005,
by the Guarantor Warrant Exercise Price (as defined below). The Guarantor
Warrant Exercise Price is equal to the greater of (i) Two Dollars ($2.00) per
share (or, if such warrant is exercised after November 16, 2005, Three Dollars
($3.00) per share) and (ii) eighty five percent (85%) of the average of the
three lowest closing bid prices for EC Power Common Stock for the ten trading
days ending on the close of business on the day before the relevant warrant is
exercised (the "Guarantor Warrant Exercise Price").
The Company also agreed in the Merger Agreement to pay off certain debt
obligations of FBC to its stockholders, and to allow the FBC stockholders who
are owed such debt to convert the debt into the Company's Series D Convertible
Preferred Stock (the "Series D Preferred Stock") at the Conversion Price (as
defined below). The Series D Preferred Stock converts into EC Power Common Stock
on a one for one basis. There are no dividend rights or price anti-dilution
rights with respect to the Series D Preferred Stock. The conversion price is
equal to the greater of (i) Two Dollars ($2.00) per share (or, if such warrant
is exercised after November 16, 2005, Three Dollars ($3.00) per share) or (ii)
eighty-five percent (85%) of the average of the three lowest closing bid prices
for EC Power Common Stock for the ten trading days ending on the close of
business on the day before the relevant debt is converted into Series D Stock
(the "Conversion Price").
The Purchase Price and the terms of the Merger Agreement were determined
by arms-length negotiation among the parties. To the knowledge of the Company,
none of the Company, any affiliate, director, officer, or any associate of any
director or officer of the Company had any material relationship with FBC prior
to the transaction except that the Company loaned FBC One Hundred Thousand
Dollars ($100,000), which had not been repaid as of the consummation of the
Merger.
Item 2.01 Completion of Acquisition or Disposition of Assets
The information disclosed in Item 1.01 with respect to the Merger is
incorporated herein by reference.
As a result of the Merger, the Company acquired all of the assets of FBC.
The assets of FBC include patents, trademarks, inventory, accounts receivable,
contracts for providing services, office equipment and all books and records of
FBC (collectively, the "FBC Assets"). The Company currently intends to use the
FBC Assets in the manner they were used by FBC immediately prior to the Merger.
In connection with the closing of the Merger, the Company issued a press
release, a copy of which is attached hereto as Exhibit 99.2 and is specifically
incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation
On November 16, 2004, the Company agreed to pay off debt obligations of
FBC owed to certain FBC stockholders (the "Debt Obligations"). The total amount
of the Debt Obligations as of November 16, 2004, were Five Hundred Sixty One
Thousand Eight Hundred Eighty Seven Dollars ($561,887). The Debt Obligations
will be paid off in quarterly payments over a three (3) year period at a rate of
seven percent (7%) per annum. The Debt Obligations may be converted into Series
D Preferred Stock at any time at the option of the holder of such debt.
Item 3.02 Unregistered Sales of Equity Securities
The information disclosed in Item 1.01 with respect to the Merger is
incorporated herein by reference.
The issuance of the securities referred to in Item 1.01 above is intended
to be exempt from registration under the Securities Act of 1933, as amended (the
"Securities Act"), under Section 4(2) of the Securities Act and Regulation D
promulgated thereunder.
The summary of the terms of the warrants and Series D Preferred Stock is
qualified in its entirety by the Merger Agreement (including the forms of
warrants and terms of Series D Preferred Stock attached as exhibits to the
Merger Agreement), which is attached as Exhibit 99.1 hereto.
Item 5.02 Corporate Governance and Management
On November 16, 2004, Klaus Seibert was appointed to the Board of
Directors of the Company pursuant to the terms of the Merger Agreement.
Item 9.01 Unregistered Sales of Equity Securities
(a) Financial Statements of Business Acquired.
In accordance with Item 9.01(a)(4) of Form 8-K, the Company will provide
the financial information required by this Item 9.01(a) by filing an amendment
to this Form 8-K within 71 calendar days from the date of this filing.
(b) Pro Forma Financial Information.
In accordance with Item 9.01(b)(2) of Form 8-K, the Company will provide
the financial information required by this Item 9.01(b) by filing an amendment
to this Form 8-K within 71 calendar days from the date of this filing.
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.
EC POWER, INC.
By: /S/ MICHEL MORIN
-----------------------------
Name: Michel Morin
Title: President
Dated: November 22, 2004
INDEX TO EXHIBITS
Exhibit Number Description
99.1 Agreement and Plan of Merger, dated November 16, 2004, by
and among EC Power, Inc., EC Power Acquisition Corp. and FBC
Technologies, Inc.
99.2 Press release of EC Power, Inc., dated November 16, 2004,
announcing its acquisition of FBC Technologies, Inc.