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): October 21, 2016

 

ENER-CORE, Inc.

(Exact name of registrant as specified in its charter)

 

Delaware   001-37642   45-0525350
(State or other jurisdiction
of incorporation) 		  (Commission File Number)   (I.R.S. Employer
Identification No.)

 

9400 Toledo Way
Irvine, California 92618

(Address of principal executive offices) (Zip Code)

 

(949) 616-3300

(Registrant's telephone number, including area code)

 

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))

 

 

 

 

 

 

Item 1.01 Entry into a Material Definitive Agreement.

 

Amendments to 2015 Notes

 

Effective as of October 21, 2016, the Company and certain investors holding senior secured notes issued by the Company in April and May 2015 (the “Senior Notes”) executed Sixth Amendments to such Senior Notes and Waivers (the “Senior Notes Amendments”) to clarify and conform the terms of such Senior Notes to the terms of previous amendments to such Senior Notes and the Securities Purchase Agreement dated April 22, 2015 and Securities Purchase Agreement dated May 7, 2015 pursuant to which such investors purchased the Senior Notes. The forms of Senior Notes Amendments are attached as Exhibits 4.1 and 4.2, respectively, to this Current Report on Form 8-K and are also incorporated herein by reference. The foregoing descriptions of these agreements and instruments do not purport to be complete and are qualified in their entirety by reference to such exhibits.

 

Item 8.01 Other Events.

 

On October 21, 2016, the Company issued a press release, which is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.

 

 Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit Number   Description
4.1   Sixth Amendment to Senior Secured Notes issued in April 2015 and Waiver, effective as of October 21, 2016
4.2   Sixth Amendment to Senior Secured Notes issued in May 2015 and Waiver, effective as of October 21, 2016
99.1   Press Release dated October 21, 2016

 

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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.

 

  ENER-CORE, Inc.
     
Dated: October 24, 2016 By: /s/ Domonic J. Carney
    Domonic J. Carney
    Chief Financial Officer

 

  3  

 

 

EXHIBIT INDEX

 

Exhibit Number   Description
4.1   Sixth Amendment to Senior Secured Notes issued in April 2015 and Waiver, effective as of October 21, 2016
4.2   Sixth Amendment to Senior Secured Notes issued in May 2015 and Waiver, effective as of October 21, 2016
99.1   Press Release dated October 21, 2016

 

 

4

 

Exhibit 4.1

 

SIXTH AMENDMENT TO

SENIOR SECURED NOTES AND WAIVER

 

THIS SIXTH AMENDMENT TO SENIOR SECURED NOTES AND WAIVER (this “ Amendment ”) is made and entered into as of October 21, 2016 by and among Ener-Core, Inc., a Delaware corporation (the “ Company ”), and the undersigned, and amends those certain Senior Secured Notes dated as of April 23, 2015 (as amended to date, the “ Notes ”) as issued by the Company pursuant to that certain Securities Purchase Agreement, dated April 22, 2015, by and among the Company, the “Buyers” identified therein, and the Collateral Agent identified therein (as amended to date, the “ Agreement ”). Capitalized terms used herein but not otherwise defined herein shall have the meanings ascribed to such terms in the Notes.

 

RECITALS

 

WHEREAS , pursuant to Section 15 of the Notes, the written consent of the holders of Notes representing at least a majority of the aggregate principal amount of the Notes then outstanding, including Empery Asset Master, Ltd. (“ Empery ”) so long as Empery or any of its Affiliates holds any Notes (the “ Required Holders ”), shall be required for any change or amendment or waiver of any provision of the Notes, provided that any such amendment or waiver does not disproportionately, materially and adversely affect the rights and obligations of any Holder relative to the comparable rights and obligations of the other Holders;

 

WHEREAS , any amendment or waiver effected in accordance with Section 15 of the Notes is binding upon all holders of Notes;

 

WHEREAS , the Company and the Required Holders previously amended the Agreement to extend the applicable period for the Company to list its Common Stock on a national securities exchange and wish to conform the language of the Notes consistent with such prior adjustment; and

 

WHEREAS , the parties hereto wish to amend the Notes as set forth below.

 

AGREEMENT

 

NOW, THEREFORE , in consideration of the mutual covenants herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, intending to be legally bound, agree as follows:  

 

ARTICLE I
AMENDMENTS TO THE NOTES

 

Section 1.1 Event of Default . Section 4(a)(i) of the Notes is hereby amended and restated as follows:

 

“(i) the suspension of the Common Stock from trading for a period of five (5) or more consecutive Trading Days or for more than an aggregate of ten (10) Trading Days in any 365 day period or the failure of the Common Stock to be listed or quoted on an Eligible Market;”

 

Section 1.2 Eligible Market . Section 29(i) of the Notes is hereby amended and restated as follows:

 

“(i) “ Eligible Market ” The New York Stock Exchange, The NASDAQ Global Market, The NASDAQ Global Select Market, The NASDAQ Capital Market, the NYSE MKT or the Principal Market.”

 

ARTICLE II

WAIVER

 

Section 2.1 Waiver . Any Event of Default pursuant to Section 4(a)(i) of the Notes occurring from or after October 22, 2015, and through and including the effective date of this Amendment (the “ Period ”), is irrevocably waived on behalf of all holders of Notes (the “ Waiver ”). Such Waiver shall extend to, without limitation any adjustments of terms, applications of alternate rights and any Company restrictions that would have arisen from any such Event of Default.

 

Section 2.2 Acknowledgement of Waiver . Each Required Holder hereby represents and warrants to the Company that: (i) such holder has the full right, power and authority to execute and deliver this Waiver, and (ii) this Waiver has been duly and validly authorized, executed and delivered on behalf of the holder and shall constitute the legal, valid and binding obligation of the holder, enforceable against each of the holders of the Notes, in accordance with its terms.

 

   
 

 

article iii
MISCELLANEOUS

 

Section 3.1 Effect of this Amendment . This Amendment shall form a part of each Note for all purposes, and each holder thereof shall be bound hereby. This Amendment shall only be deemed to be in full force and effect from and after both the execution of this Amendment by the parties hereto and the execution of agreements substantially identical to this Amendment by the Company and holders of Notes representing at least a majority of the sum of (1) the aggregate principal amount of the Notes then outstanding and (2) the aggregate principal amount of the April 2015 Notes (as defined in the Agreement) then outstanding that, together with undersigned, constituting the Required Holders. From and after such effectiveness, any reference to the Notes shall be deemed to be a reference to the Notes as amended hereby. Except as specifically amended as set forth herein, each term and condition of the Notes shall continue in full force and effect.

 

Section 3.2 Entire Agreement . This Amendment, together with the Notes, contains the entire agreement of the parties and supersedes any prior or contemporaneous written or oral agreements between them concerning the subject matter of this Amendment.

 

Section 3.3 Governing Law . This Amendment shall be governed by the internal law of the State of New York.

 

Section 3.4 Counterparts . This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature pages are physically attached to the same document. This Amendment may be executed by fax or electronic mail, in PDF format, and no party hereto may contest this Amendment’s validity solely because a signature was faxed or otherwise sent electronically.

 

[Signature Pages Follow]

 

  2  
 

 

IN WITNESS WHEREOF , the parties hereto have executed this Sixth Amendment to Senior Secured Notes and Waiver as of the date first written above.

 

  COMPANY:
   
  ENER-CORE, INC.
     
  By:       
    Name:
    Title:  

 

[Signature Page to Sixth Amendment to Senior Secured Notes and Waiver—April 2015] 

 

  3  
 

 

IN WITNESS WHEREOF , the parties hereto have executed this Sixth Amendment to Senior Secured Notes and Waiver as of the date first written above.

 

 

HOLDER:

     
  By:       
    Name:
    Title:

 

[Signature Page to Sixth Amendment to Senior Secured Notes and Waiver—April 2015] 

 

 

4

Exhibit 4.2

 

SIXTH AMENDMENT TO

SENIOR SECURED NOTES AND WAIVER

 

THIS SIXTH AMENDMENT TO SENIOR SECURED NOTES AND WAIVER (this “ Amendment ”) is made and entered into as of October 21, 2016 by and among Ener-Core, Inc., a Delaware corporation (the “ Company ”), and the undersigned, and amends those certain Senior Secured Notes dated as of May 9, 2015 (as amended to date, the “ Notes ”) as issued by the Company pursuant to that certain Securities Purchase Agreement, dated May 7, 2015, by and among the Company, the “Buyers” identified therein, and the Collateral Agent identified therein (as amended to date, the “ Agreement ”). Capitalized terms used herein but not otherwise defined herein shall have the meanings ascribed to such terms in the Notes.

 

RECITALS

 

WHEREAS , pursuant to Section 15 of the Notes, the written consent of the holders of Notes representing at least a majority of the sum of (1) the aggregate principal amount of the Notes then outstanding and (2) the aggregate principal amount of the April 2015 Notes (as defined in the Agreement) then outstanding, including Empery Asset Master, Ltd. (“ Empery ”) so long as Empery or any of its Affiliates holds any April 2015 Notes (the “ Required Holders ”), shall be required for any change or amendment or waiver of any provision of the Notes, provided that any such amendment or waiver does not disproportionately, materially and adversely affect the rights and obligations of any Holder relative to the comparable rights and obligations of the other Holders;

 

WHEREAS , any amendment or waiver effected in accordance with Section 15 of the Notes is binding upon all holders of Notes;

 

WHEREAS , the Company and the Required Holders previously amended the Agreement to extend the applicable period for the Company to list its Common Stock on a national securities exchange and wish to conform the language of the Notes consistent with such prior adjustment; and

 

WHEREAS , the parties hereto wish to amend the Notes as set forth below.

 

AGREEMENT

 

NOW, THEREFORE , in consideration of the mutual covenants herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, intending to be legally bound, agree as follows:

 

ARTICLE I
AMENDMENTS TO THE NOTES

 

Section 1.1 Event of Default . Section 4(a)(i) of the Notes is hereby amended and restated as follows:

 

“(i) the suspension of the Common Stock from trading for a period of five (5) or more consecutive Trading Days or for more than an aggregate of ten (10) Trading Days in any 365 day period or the failure of the Common Stock to be listed or quoted on an Eligible Market;”

 

Section 1.2 Eligible Market . Section 29(i) of the Notes is hereby amended and restated as follows:

 

“(i) “ Eligible Market ” The New York Stock Exchange, The NASDAQ Global Market, The NASDAQ Global Select Market, The NASDAQ Capital Market, the NYSE MKT or the Principal Market.”

 

ARTICLE II

WAIVER

 

Section 2.1 Waiver . Any Event of Default pursuant to Section 4(a)(i) of the Notes occurring from or after October 22, 2015, and through and including the effective date of this Amendment (the “ Period ”), is irrevocably waived on behalf of all holders of Notes (the “ Waiver ”). Such Waiver shall extend to, without limitation any adjustments of terms, applications of alternate rights and any Company restrictions that would have arisen from any such Event of Default.

 

Section 2.2 Acknowledgement of Waiver . Each Required Holder hereby represents and warrants to the Company that: (i) such holder has the full right, power and authority to execute and deliver this Waiver, and (ii) this Waiver has been duly and validly authorized, executed and delivered on behalf of the holder and shall constitute the legal, valid and binding obligation of the holder, enforceable against each of the holders of the Notes, in accordance with its terms.

 

   
 

 

article iii
MISCELLANEOUS

 

Section 3.1 Effect of this Amendment . This Amendment shall form a part of each Note for all purposes, and each holder thereof shall be bound hereby. This Amendment shall only be deemed to be in full force and effect from and after both the execution of this Amendment by the parties hereto and the execution of agreements substantially identical to this Amendment by the Company and holders of Notes representing at least a majority of the sum of (1) the aggregate principal amount of the Notes then outstanding and (2) the aggregate principal amount of the April 2015 Notes (as defined in the Agreement) then outstanding that, together with undersigned, constituting the Required Holders. From and after such effectiveness, any reference to the Notes shall be deemed to be a reference to the Notes as amended hereby. Except as specifically amended as set forth herein, each term and condition of the Notes shall continue in full force and effect.

 

Section 3.2 Entire Agreement . This Amendment, together with the Notes, contains the entire agreement of the parties and supersedes any prior or contemporaneous written or oral agreements between them concerning the subject matter of this Amendment.

 

Section 3.3 Governing Law . This Amendment shall be governed by the internal law of the State of New York.

 

Section 3.4 Counterparts . This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature pages are physically attached to the same document. This Amendment may be executed by fax or electronic mail, in PDF format, and no party hereto may contest this Amendment’s validity solely because a signature was faxed or otherwise sent electronically.

 

[Signature Pages Follow]

 

  2  
 

 

IN WITNESS WHEREOF , the parties hereto have executed this Sixth Amendment to Senior Secured Notes and Waiver as of the date first written above.

 

  COMPANY:
   
  ENER-CORE, INC.
     
  By:     
    Name:
    Title:

 

[Signature Page to Sixth Amendment to Senior Secured Notes and Waiver—May 2015] 

 

  3  
 

 

IN WITNESS WHEREOF , the parties hereto have executed this Sixth Amendment to Senior Secured Notes and Waiver as of the date first written above.

 

 

HOLDER:

     
  By:      
    Name:
    Title:

 

[Signature Page to Sixth Amendment to Senior Secured Notes and Waiver—May 2015]

 

 

4

Exhibit 99.1

 

 

 

Ener-Core Completes Delivery of its First 2 MW Power Oxidizers to
Pacific Ethanol Stockton Biorefinery

 

Represents Ener-Core’s First Commercial Shipment of its Recently Scaled-Up 2 MW Systems

 

IRVINE, Calif. – October 21, 2016 - Ener-Core, Inc. (OTCQB: ENCR), a developer of innovative gas conversion technologies for global commercial and industrial facilities, has delivered two of its 2 megawatt (MW) sized Power Oxidizers to the Stockton Biorefinery site owned by Pacific Ethanol (NASDAQ: PEIX). The shipment is a momentous occasion for Ener-Core, having deployed a commercial scale-up of the power capacity of the Power Oxidizer technology from 250kW to 2 MW over the last 18 months.

 

The Power Oxidizers, after delivery and installation with the Dresser-Rand KG2 turbine, are expected to provide up to 3.5 MW of electricity and over 26,000 pounds of steam/hr from the two Power Station units. The Power Stations will provide Pacific Ethanol (PEIX), a leading producer and marketer of low-carbon renewable fuels, with a first-of-its-kind solution that can reduce air pollution by converting by-product low-quality waste gases generated by the Stockton plant’s ethanol production into useful electricity and steam. The Power Stations are intended to significantly reduce the quantity of energy currently purchased by Pacific Ethanol’s Stockton plant and are expected to reduce their energy costs by an estimated $3 to $4 million per year, representing a significant reduction in operating expenses for the plant.

 

The Ener-Core Power Oxidizer is designed to provide an alternative to a traditional combustion chamber within gas turbines for purposes of power generation. The Power Oxidizer, when coupled with an integrated gas turbine, allows a wide range of industries to utilize previously unusable low-quality gases and certain volatile organic compounds as a low-cost fuel source to generate on-site heat, power and steam. Ener-Core’s delivery is the first step in the commissioning process and Ener-Core’s engineering team will continue to work with the engineering teams from Dresser-Rand toward the installation of these systems at Pacific Ethanol’s Stockton Biorefinery in next few months.

 

Alain Castro, CEO of Ener-Core, commented: “The enthusiasm within our team runs quite high at the moment, as this is an important milestone for all of us, especially the engineers and staff in our Irvine, California headquarters that have worked so hard on the scale-up of this technology over the last two years. The road to achieving utility-grade scale of our Power Oxidizer represents a significant engineering accomplishment with global repercussions in a growing market segment. We, as a management team are humbled by everyone’s commitment to this common goal. We look forward to the installation of these systems at Pacific Ethanol’s industrial plant later this year and to building upon this success and expanding our technology and product portfolio in the near future.”

 

About Pacific Ethanol

Pacific Ethanol, Inc. (NASDAQ: PEIX) is the leading producer and marketer of low-carbon renewable fuels in the Western United States. With the addition of four Midwestern ethanol plants in July 2015, Pacific Ethanol more than doubled the scale of its operations, entered new markets, and expanded its mission to advance its position as an industry leader in the production and marketing of low carbon renewable fuels. Pacific Ethanol owns and operates eight ethanol production facilities, four in the Western states of California, Oregon and Idaho, and four in the Midwestern states of Illinois and Nebraska. The plants have a combined production capacity of 515 million gallons per year, produce over one million tons per year of ethanol co-products such as wet and dry distillers grains, wet and dry corn gluten feed, condensed distillers solubles, corn gluten meal, corn germ, corn oil, distillers yeast and CO2. Pacific Ethanol markets and distributes ethanol and co-products domestically and internationally. Pacific Ethanol’s subsidiary, Kinergy Marketing LLC, markets all ethanol for Pacific Ethanol’s plants as well as for third parties, with over 800 million gallons of ethanol marketed annually based on historical volumes. Pacific Ethanol’s subsidiary, Pacific Ag. Products LLC, markets wet and dry distillers grains. For more information, please visit www.pacificethanol.com .

 

 

 

 

About Ener-Core

Irvine, California-based Ener-Core, Inc. (OTCQB: ENCR) designs, manufactures and has commercially deployed unique systems that generate base load, clean power from polluting waste gases including methane. Ener-Core’s patented Power Oxidizer turns one of the most potent pollution sources into a profitable, “always on” source of clean energy. Ener-Core’’s technology offers an alternative to the flaring (burning) of gaseous pollution while generating operating efficiencies and reducing the costs of compliance with environmental regulations. Ener-Core offers the 250kW Ener-Core EC250 and the larger, 2MW Ener-Core Powerstation KG2-3GEF/PO. For more information, please visit www.ener-core.com .

 

Cautionary Statement Regarding Forward-Looking Statements

Forward-looking statements contained in this press release are made under the Safe Harbor Provision of the Private Securities Litigation Reform Act of 1995. Information provided by Ener-Core, Inc., such as online or printed documents, publications or information available via its website may contain forward-looking statements that involve risks, uncertainties, assumptions, and other factors, which, if they do not materialize or prove correct, could cause its results to differ materially from historical results, or those expressed or implied by such forward-looking statements. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements, including statements containing the words “planned,” “expects,” “believes,” “strategy,” “opportunity,” “anticipates,” and similar words. These statements may include, among others, plans, strategies, and objectives of management for future operations; any statements regarding proposed new products, services, or developments; any statements regarding future economic conditions or performance; statements of belief; and any statements of assumptions underlying any of the foregoing. The information contained in this release is as of the date of this press release. Except as otherwise expressly referenced herein or required by law, Ener-Core assumes no obligation to update forward-looking statements.

 

Media and Investor Relations:
MZ Group
Chris Tyson
Managing Director - MZ North America
Direct: 949-491-8235
ENCR@mzgroup.us
www.mzgroup.us