Attached files
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, January 13, 2010)
EXOUSIA
ADVANCED MATERIALS, INC.
(Exact
name of registrant as specified in its charter)
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Texas
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333-87696
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90-0347581
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(State
of incorporation)
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(Commission
File Number)
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(IRS
Employer Identification Number)
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16533
Shady Lane
Channelview,
TX 77530
(Address
of principal executive offices)
(Telephone
number, including area code of agent for service) (281) 452 5079
Check the
appropriate box below if the Form 8-K/A 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))
On January 13, 2010, a Certificate of
Merger was filed with the Delaware Secretary of State wherein Exousia Advanced
Materials, Inc. ("the Company") acquired all of the outstanding ownership of
Evergreen Global Investments Ltd, a Delaware corporation (“Evergreen”) pursuant
to the terms of an Agreement and Plan of Merger dated and effective December 31,
2009 (the “Merger Agreement”), among Evergreen and Exousia Merger Subsidiary I,
Inc., a Delaware corporation and wholly owned subsidiary of Exousia ("Merger
Sub"), pursuant to which Merger Sub merged with and into Evergreen (the
"Merger"). As a result of the Merger, the separate corporate existence of Merger
Sub ceased and Evergreen continued as the surviving corporation and as a wholly
owned subsidiary of Exousia. On December 31, 2009, the board of directors of the
Company approved the issuance of the Series A Preferred Stock to the former
shareholders of Evergreen and waived the provisions Section 21.601 et. seq of
Texas Business Organization Code (the “TBOC”) as to the acquisition of shares of
Series A Preferred Stock by the former shareholders of
Evergreen. Due to such approval by the board of directors of
the Company, the provisions of TBOC Section 21.601 will not apply to the former
shareholders of Evergreen. Section 21.601 of the TBOC restricts
certain transactions between a public company and shareholders who hold more
than 20% of the stock of such public company unless the original acquisition of
such stock was approved by the board of directors of the public company prior to
the acquisition of stock by such affiliated shareholder.
The
acquisition price for Evergreen is $23,971,030 for which the Company issued 10
million shares of its Series A Preferred Stock to the former shareholders of
Evergreen, increasing the Company’s shareholders’ equity by an equal amount. Of
these 10 million shares, 6,026,958 Shares of Series A Preferred Stock went to
Able Energy, Inc. (“Able”), 3,894,367 Shares of Series A Preferred Stock went to
Evergreen Financial Services, Inc. (“Evergreen Financial”), and 78,675 Shares of
Series A Preferred Stock to Green Tree Capital Group (“Green Tree”). Each share
of Series A Preferred Stock has a liquidation preference of $2.60 per share and
is convertible into Twenty and 475/1000 (20.475) shares of Common Stock of the
Company (“Common Stock”) when and if the Company amends its certificate of
formation to provide for sufficient shares of Common Stock to allow such
conversion. Each share of Series A Preferred Stock also has the right to twenty
and 475/1000 (20.475) times the dividends paid on each share of Common Stock and
to Twenty and 475/1000 (20.475) votes per share of Series A Preferred Stock.
Until the conversion of the Series A Preferred Stock into Common Stock, Able
will hold 123,401,965.05 votes as to any matter submitted to the shareholders of
the Company, Evergreen Financial will hold 79,737,164.25 votes and Green Tree
will hold 1,610,870.625 votes. Upon amendment of the Company’s certificate of
formation to increase the number of authorized shares of Common Stock to an
amount sufficient to provide for such conversion, each share of Series Preferred
Stock will automatically convert into 20.475 shares of Common
Stock. Following such conversion, Able will hold 123,401,965.05
shares of Common Stock, Evergreen Financial will hold 79,737,164.25 shares of
Common Stock and Green Tree will hold 1,610,870.625 shares of Common
Stock. The Company has called a special meeting of the shareholders
of the Company to authorize the amendment of the Company Certificate of
Formation to increase the number of authorized shares of Common Stock to
350,000,000 shares of Common Stock from the current 100,000,000 shares of Common
Stock. See Item 8.01 below.
The issuance of the shares of Series A
Preferred Stock to the former shareholders of Evergreen pursuant to the Merger
Agreement described above was exempt from the registration requirements of the
Securities Act in reliance upon the exemption from registration provided by
Rule 506 of Regulation D promulgated under the Securities
Act.
Cautionary
Note Regarding Merger Agreement
The
foregoing description of the Merger Agreement does not purport to be complete
and is qualified in its entirety by reference to the complete text of the Merger
Agreement, which is attached hereto as Exhibit 1.1 and is incorporated
herein by reference. The Merger Agreement has been attached to provide investors
with information regarding its terms. It is not intended to provide any other
factual information about Exousia or Evergreen. In particular, the assertions
embodied in the representations and warranties contained in the Merger Agreement
are qualified by information in confidential disclosure schedules provided by
Exousia and Evergreen in connection with the signing of the Merger Agreement.
These disclosure schedules contain information that modifies, qualifies and
creates exceptions to the representations and warranties set forth in the Merger
Agreement. Accordingly, the representations and warranties in the Merger
Agreement may not constitute the actual state of facts about Exousia or
Evergreen.
Item
2.01 Completion of Acquisition or Disposition of
Assets.
The
information contained in Item 1.01 above is hereby incorporated by reference
into this Item 2.01.
Item
3.02 Unregistered Sale of Equity and Securities.
As
described in Item 1.01 above, in connection with the consummation of the
transactions contemplated by the Merger Agreement, the Company established a new
series of Preferred Stock. Each share of Series A Preferred Stock has
a liquidation preference of $2.60 per share and is convertible into Twenty and
475/1000 (20.475) shares of Common Stock of the Company when and if the Company
amends its certificate of formation to provide for sufficient shares to allow
such conversion. Each share of Series A Preferred Stock also has the right to
twenty and 475/1000 (20.475) times the dividends paid on each share of Common
Stock and to Twenty and 475/1000 (20.475) votes per share of Series A Preferred
Stock. Upon amendment of the Company’s certificate of formation to increase the
number of authorized shares of Common Stock to an amount sufficient to provide
for such conversion, each share of Series Preferred Stock will automatically
convert into 20.475 shares of Common Stock. The Company has called a special
meeting of the shareholders of the Company to authorize such additional shares
of Common Stock. Until the conversion of the Series A Preferred Stock into
Common Stock, Able will hold 123,401,965.05 votes as to any matter submitted to
the shareholders of the Company, Evergreen Financial will hold 79,737,164.25
votes and Green Tree will hold 1,610,870.625 votes. Following the conversion of
the Series A Preferred Stock to Common Stock, Able will hold 123,401,965.05
shares of Common Stock, Evergreen Financial will hold 79,737,164.25 shares of
Common Stock and Green Tree will hold 1,610,870.625 shares of Common
Stock.
The issuance of the shares of Series A
Preferred Stock to the former shareholders of Evergreen Financial pursuant to
the Merger Agreement described above was exempt from the registration
requirements of the Securities Act in reliance upon the exemption from
registration provided by Rule 506 of Regulation D promulgated under
the Securities Act.
The
certificate of designation establishing the Series A Preferred Stock is being
filed as Exhibit 3.1 to this Form 8-K.
Item 5.01 Changes
in Control or Registration.
In connection with the consummation of
the transactions contemplated by the Merger Agreement, the Company issued
10,000,000 shares of Series Preferred Stock to the former shareholders of
Evergreen. The shares of Series A Preferred Stock are convertible
into 200,475,000 shares of Common Stock. The Company has 62,123,975
shares of Common Stock currently outstanding and 37,876,025 shares reserved for
issuance to others pursuant to warrants and stock option grants. In addition,
the Company has agreements in place for the issuance of an additional 10,089,240
warrants when and if the Company amends its certificate of formation to provide
for sufficient shares to allow for the issuance of said warrants. Each share of
Series A Preferred Stock is convertible into Twenty and 475/1000 (20.475) shares
of Common Stock of the Company when and if the Company amends its certificate of
formation to provide for sufficient shares to allow such conversion. Each share
of Series A Preferred Stock also has the right to twenty and 475/1000 (20.475)
times the dividends paid on each share of Common Stock and to Twenty and
475/1000 (20.475) votes per share of Series A Preferred Stock. As a result of
such issuance, the former shareholders of Evergreen may elect four new directors
of the Company, bringing the total number of directors of the Company to seven,
as provided for in the Company’s By-Laws.
There are no agreements with the former
Evergreen shareholders as to the voting of the securities issued to such
entities.
Item
8.01 Other Events.
Exousia issued a press release on
January 13, 2010, a copy of which is filed as Exhibit 8.1 hereto and is
incorporated herein by reference, announcing the execution of the Merger
Agreement.
Following
the Merger, the Company expects to improve its financial condition pre-merger by
increasing the Company’s shareholders’ equity by $23,971,030 from its
anticipated pre-merger shareholders’ equity deficit in excess of $1.3 million.
In the month of December 2009, the revenues of the post-merger entity were
approximately $5 million.
In the
Company’s Form 10-Q for the period ending September 30 2009, filed with the
Securities and Exchange Commission on November 23, 2009, the Company stated that
the 3rd Quarter 2009 represented the weakest financial performance in terms of
Sales and Operating Income since the Company began filing as a commercial
enterprise following its Developmental Stage filings and that the Company does
not have significant cash or other material liquid assets, nor have an
established source of revenue sufficient to cover its operating costs and to
allow it to continue as a going concern. The primary factor contributing to
the Company’s weak performance was stated to have been the Company’s inability
over the last year to raise Working Capital to fund the initial inventories and
receivables associated with the contracts the Company has in China as well as
the opportunities it has developed in the U.S. In the Company’s Form 10-Q for
the period ending September 30 2009, the Company listed a deficit shareholders’
equity of ($704,490) on total assets of $2,660,891 consisting primarily of
patents with a carrying value of $1,448,842. The Company had current liabilities
which totaled $3,365,381; $494,871 of which were accounts payable, $801,985 of
accrued expenses, and $2,068,525 for notes payable. The Company’s revenues
for the nine months ended September 30, 2009 were $314,486. The
Company sustained losses of $4,511,600 for the nine months ended September 30,
2009.
On
January 13, 2010, the Company announced that it has called a special meeting of
its stockholders to be held at the earliest possible date at the offices of
Farnsworth & vonBerg, LLP, the Company’s counsel, 333 North Sam Houston
Parkway, Suite 300, Houston, Texas 77060, to consider and vote on a
proposed amendment to the Company’s Certificate of Formation to increase the
number of authorized shares of Common Stock to 350,000,000 shares of Common
Stock from 100,000,000 shares of Common Stock.
The
Company and its directors and officers may be soliciting proxies from our
stockholders in favor of the proposals. Information regarding the persons who,
under the rules of the SEC, are participants in the solicitation of our
stockholders in connection with the proposals are set forth in the definitive
proxy statement filed with the SEC.
This Current Report on Form 8-K is
not a proxy statement or a solicitation of proxies from our stockholders. Any
solicitation of proxies will be made only pursuant to the definitive proxy
statement to be mailed to our stockholders who held our stock as of the record
date. We urge stockholders to read the definitive proxy statement and appendices
thereto because they contain important information about our company and the
proposals to be presented at the special meeting of stockholders.
(a) Financial
Statements of Business Acquired.
It is impracticable for the Company to
provide the required financial statements for the business acquired at the time
of filing this report on Form 8-K, but the Company will file such required
financial statements by amendment to this report on Form 8-K as soon as
practicable, but not later than seventy-one (71) days after this report must be
filed with the Securities and Exchange Commission.
(b) Pro
Forma Financial Information.
It is impracticable for the Company to
provide the required pro forma financial information for the business acquired
at the time of filing this report on Form 8-K, but the Company will file such
required financial statements by amendment to this report on Form 8-K as
soon as practicable, but not later than seventy-one (71) days after this report
must be filed with the Securities and Exchange Commission.
(d) Exhibits.
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Exhibit No.
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Description
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1.1
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Agreement
and Plan of Merger dated as of December 31, 2009 among Evergreen Global
Investments Ltd. and Exousia Merger Subsidiary I, Inc.
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3.1
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Certificate
of Designation and Preferences of Series A Convertible Preferred Stock of
Exousia Advanced Materials, Inc.
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8.1
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Press
release issued by Exousia on January 13,
2010.
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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.
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EXOUSIA
ADVANCED MATERIALS, INC.
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Date: January
13, 2010
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By://s// J. Wayne
Rodrigue
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CEO/President/Chairman
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