FUELCELL ENERGY INC (Form: 8-K, Received: 11/02/2021 08:07:21)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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 29, 2021

FUELCELL ENERGY, INC.

(Exact Name of Registrant as Specified in its Charter)


Delaware	1-14204	06-0853042
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

	3 Great Pasture Road, Danbury, Connecticut	06810
	(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (203) 825-6000

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:

☐ 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))

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.0001 par value per share	FCEL	The Nasdaq Stock Market LLC (Nasdaq Global Market)

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01.Entry into a Material Definitive Agreement.

Amendment No. 1 to Joint Development Agreement between FuelCell Energy, Inc. and ExxonMobil Research and Engineering Company and Related Letter Agreement

On October 29, 2021, FuelCell Energy, Inc. (the “Company”) and ExxonMobil Research and Engineering Company (“EMRE”) entered into Amendment No. 1 to the Joint Development Agreement between the Company and EMRE (“Amendment No. 1”).

The Joint Development Agreement between the Company and EMRE (the “Original Agreement”) was executed on November 5, 2019, was effective as of October 31, 2019, and had a term of two years from the effective date, ending on October 31, 2021. Under the Original Agreement, the Company has engaged in exclusive research and development efforts with EMRE to evaluate and develop new and/or improved carbonate fuel cells to reduce carbon dioxide emissions from industrial and power sources in exchange for (i) payment by EMRE of certain fees and costs as well as certain milestone-based payments to be paid only if certain technological milestones are met, two of which had not been satisfied as of the execution of Amendment No. 1, and (ii) certain licenses, in each case as described in the Original Agreement. The terms of the Original Agreement are described more fully in the Current Report on Form 8-K filed by the Company on November 6, 2019.

In Amendment No. 1, which is effective as of October 31, 2021, the Company and EMRE agreed, among other things, to extend the term for an additional six months, ending on April 30, 2022, unless terminated earlier in accordance with the provisions of the Original Agreement. Amendment No. 1 allows for the continuation of research that would enable incorporation of design improvements to current Company fuel cell design in order to support a decision to use the improvements in a future demonstration of the technology for capturing carbon at ExxonMobil’s Rotterdam refinery in the Netherlands (such demonstration, the “Rotterdam Project”) and provides additional time to achieve Milestone 1, as defined in the Original Agreement. Under the terms set forth in the Original Agreement, upon achievement by the Company of Milestone 1 to EMRE’s satisfaction, the Company would be entitled to receive a milestone payment of $5.0 million from EMRE. However, there can be no assurance that the Company will achieve Milestone 1 (or any other milestone) to EMRE’s satisfaction.

In a related letter agreement between the Company and EMRE dated as of October 28, 2021 and executed on October 29, 2021 (the “Letter Agreement”), the Company agreed to invest with EMRE in the Rotterdam Project, should EMRE move forward with the demonstration project. In the Letter Agreement, the Company agreed that, if (i) the Company achieves Milestone 1, as set forth in the Original Agreement, as amended by Amendment No. 1, and (ii) EMRE and the Company execute a contractual agreement to proceed with the Rotterdam Project, then at EMRE’s option, the Company will either make an investment in the amount of $5.0 million in the Rotterdam Project or discount EMRE’s purchase of the Company’s fuel cell module and detailed engineering design, as agreed to by the parties, required for the Rotterdam Project by said amount.

The foregoing summary of the terms of Amendment No. 1 and the Letter Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of Amendment No. 1 and the Letter Agreement, copies of which are attached as Exhibit 10.1 and Exhibit 10.2, respectively, to this Current Report on Form 8-K and incorporated herein by reference.

Other Material Relationships with ExxonMobil Research and Engineering Company

In addition to the Original Agreement (as amended by Amendment No. 1) and the Letter Agreement, in June 2019, the Company and EMRE entered into a license agreement to facilitate the further development of the Company’s SureSource Capture^TM product. Pursuant to this license agreement, the Company granted EMRE and its affiliates a non-exclusive, worldwide, fully-paid, perpetual, irrevocable, non-transferable license and right to use the Company’s patents filed on or before April 30, 2021, and any data, know-how, improvements, equipment designs, methods, processes and the like provided directly by the Company or its affiliates to EMRE or its affiliates under any agreement or otherwise, on or before April 30, 2021, to the extent it is useful to research, develop and commercially exploit carbonate fuel cells in applications in which the fuel cells concentrate carbon dioxide from industrial and power sources and for any other purpose attendant thereto or associated therewith.

This license agreement is being described only for the purpose of describing the material relationships between the Company and EMRE and is not impacted by Amendment No. 1 or the Letter Agreement.

Item 7.01 Regulation FD Disclosure.

On November 2, 2021, the Company issued a press release announcing the extension of the term of its Joint Development Agreement with EMRE. A copy of this press release is furnished with this Current Report on Form 8-K as Exhibit 99.1.

The information furnished in this Item 7.01, including Exhibit 99.1, is not deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section. This information will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Company specifically incorporates it by reference.

Item 8.01.Other Events.

Long Island Power Authority Project Awards Update

As previously reported, in July 2017 the Company was awarded three projects on Long Island, New York totaling 39.8 MW by the Long Island Power Authority (“LIPA”). In December 2018, the Company executed a power purchase agreement for one of the three awards (a 7.4 MW project in Yaphank, Long Island), which is currently reflected in the Company’s backlog, is in late-stage construction and is expected to reach commercial operations in the near term.

The other two awards, for which there are no executed power purchase agreements, and which are not part of the Company’s reported backlog, had been progressing through the required interconnect process while the Company worked to find a commercial resolution and enter into such agreements with LIPA. Given the passage of time without a resolution, the Company has made a decision to no longer pursue the interconnection process and will no longer pursue development of these two projects. As a result of this decision, the Company expects to record a non-material impairment charge estimated at approximately $1.8 million in its financial statements for the quarter and fiscal year ended October 31, 2021.

U.S. Navy Submarine Base in Groton, Connecticut Update

On September 14, 2021, the Company disclosed that the process of commissioning the 7.4 MW platform at the U.S. Navy Submarine Base in Groton, Connecticut was temporarily suspended due to a needed repair. The Company also disclosed that if commercial operations were delayed beyond October 18, 2021, an extension would be required from the Navy. An extension was received from the Navy extending the date by which commercial operations are to be achieved to December 31, 2021. As of the date of filing of this Current Report on Form 8-K, the Company has completed all necessary repairs and has resumed commissioning of the project.

In addition, as previously disclosed on September 14, 2021, in August 2021, the Company closed on a tax equity financing transaction with East West Bancorp, Inc. (“East West Bank”) for this project. East West Bank’s tax equity commitment totals $15 million. In connection with the initial closing, the Company was able to draw down $3.0 million. The Company is eligible to draw the remaining amount of the commitment, approximately $12 million, once the Groton project achieves commercial operation. Under the terms of the Company’s agreement with East West Bank, the project had a required commercial operation deadline of October 18, 2021. On October 18, 2021, East West Bank granted an extension of the commercial operation deadline to December 31, 2021.

Item 9.01.Financial Statements and Exhibits.

(d) The following exhibits are being filed or furnished (as applicable) herewith:


Exhibit No.		Description

10.1		Amendment No. 1 to Joint Development Agreement between FuelCell Energy, Inc. and ExxonMobil Research and Engineering Company, fully executed on October 29, 2021 and effective as of October 31, 2021.

10.2		Letter Agreement, dated as of October 28, 2021 and effective as of October 29, 2021, between FuelCell Energy, Inc. and ExxonMobil Research and Engineering Company.

99.1		Press Release issued by FuelCell Energy, Inc. on November 2, 2021.

104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

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.


	FUELCELL ENERGY, INC.

Date: November 2, 2021	By:	/s/ Michael S. Bishop
		Michael S. Bishop
		Executive Vice President, Chief Financial Officer and Treasurer

EXHIBIT 10.1

AMENDMENT NO. 1 to JOINT DEVELOPMENT AGREEMENT

Between

FUELCELL ENERGY, INC.

and

EXXONMOBIL RESEARCH AND ENGINEERING COMPANY

ExxonMobil Research and Engineering Company (“ExxonMobil”) and FuelCell Energy, Inc. (“FCE”) are Parties to the Joint Development Agreement with an Effective Date of October 31, 2019 and an ExxonMobil Agreement No. LAW-2019-3608 (“Agreement”).

WHEREAS, the Parties now wish to amend the Agreement to allow for continuation of research that would enable incorporation of design improvements to current fuel cell design in order to support a decision to use the technology in a demonstration unit to be deployed at the ExxonMobil Rotterdam facility (“Demo”) and to allow FCE more time to achieve Milestone 1 as provided for in the Agreement;

WHEREAS, favorable outcomes could also allow the Parties to discuss other opportunities to pilot Gen 2 technology demonstration units at third party facilities; and,

WHERE, the Parties’ mutual goal is to accelerate commercialization for high concentration input sources and more rapidly de-risk the technology by broadening participation demonstrations at certain third party sites, subject to Article 2.03 of the Agreement.

To accomplish this, effective October 31, 2021, the Parties hereby agree as follows:

1.Article 12.01 Term. shall be deleted in its entirety and replaced with the following:

12.01Term. Unless sooner terminated in accordance with this Article, this Agreement will continue in full force and effect beginning on the Effective Date and ending thirty (30) months thereafter on April 30, 2022 (“Term”).

2.	Article 20.4 Future Work., second paragraph shall be deleted in its entirety and replaced with the following:

Notwithstanding the foregoing, prior to the end of the Term of this Agreement, the Parties agree to negotiate in good faith commercially reasonable terms for the demonstration of Generation 2 Technology at one or more third party or ExxonMobil commercial facilities provided the terms detailed in future Project Descriptions are met to ExxonMobil’s satisfaction.

Except as modified herein, all provisions of the Agreement remain unchanged.

This Amendment may be executed in counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same instrument. Where provided for in applicable law, this Amendment may be executed and delivered electronically. If executing this Amendment using a handwritten signature, a Party may deliver a copy of such signature via electronic transmission and may provide the other Party a duplicate original so each Party retains an original for its records.

Each Party has caused this Amendment to be signed by its authorized representative.

FUELCELL ENERGY, INC.			EXXONMOBIL RESEARCH AND ENGINEERING COMPANY
By:	/s/ Jason Few	By:		/s/ Vijay Swarup

Name:	Jason Few	Name:		Vijay Swarup

Title:	CEO and COO	Title:		Vice President, Research & Development

Date:	October 28, 2021	Date:		October 29, 2021

Page 2 of 2

FuelCell EnergyEXHIBIT 10.2

3 Great Pasture Road

Danbury, CT 06810

www.fuelcellenergy.com

October 28, 2021

ExxonMobil Research and Engineering Company

Attn: Dr. Vijay Swarup

Vice President, Research & Development

1545 Route 22 East

Annandale, NJ 08801

Re:Memorandum of Understanding – Rotterdam Project

Dear Dr. Swarup,

Please allow this letter agreement to memorialize our recent conversation, wherein ExxonMobil Research and Engineering Company (“ExxonMobil”) and FuelCell Energy, Inc. (“FCE”) agreed to invest into the Rotterdam Project as herein described. The term “Rotterdam Project” as used herein means demonstration of an FCE fuel cell module for capturing carbon at ExxonMobil’s Rotterdam refinery located in Rotterdam, Netherlands.

FCE agrees that upon achievement of Milestone 1 as set forth in the Joint Development Agreement dated October 19, 2019, and amended by Amendment No. 1 dated October 31, 2021, and the execution of a contractual agreement between the Parties to proceed with the Rotterdam Project, at ExxonMobil’s option, FCE will either make an investment in the amount of five million dollars ($5,000,000) USD in the Rotterdam Project or FCE will discount ExxonMobil’s purchase of FCE’s fuel cell module and detailed engineering design, as agreed to by the Parties, required for the Rotterdam Project by said amount.

If ExxonMobil is in agreement with the terms set forth above, please sign and return an executed copy.

Very truly yours,

/s/ Jason Few

Jason Few

President, CEO and CCO

ExxonMobil Research and Engineering Company

By:___/s/ Vijay Swarup___________________Date: __October 29, 2021_

Dr. Vijay Swarup

Vice President, ExxonMobil Research and Engineering Company

Exhibit 99.1

FOR IMMEDIATE RELEASE

FuelCell Energy, ExxonMobil Extend Joint-Development Agreement for Carbon Capture Technology

●

Joint Development Agreement extended through April 2022 to further develop carbonate fuel cell technology for large-scale carbon capture

●

Advanced scope and timing discussions for pilot test at ExxonMobil location in Rotterdam, the Netherlands, leveraging the Porthos North Sea project

●

FuelCell Energy’s proprietary technology is the only CO₂ capture technology capable of simultaneously capturing carbon dioxide and producing power, which is anticipated to deliver cost and scale advantages

DANBURY, CT, November 2, 2021 – FuelCell Energy, Inc. (Nasdaq: FCEL) -- a global leader in fuel cell technology with a purpose of utilizing its proprietary, state-of-the-art fuel cell platforms to enable a world empowered by clean energy—has signed a six-month extension with ExxonMobil to continue collaboration on carbonate fuel cell technology for the purpose of capturing carbon dioxide from industrial facilities and power generation.

The agreement will now continue until April 30, 2022. The parties are discussing an ExxonMobil pilot in Rotterdam, the Netherlands, as well as potentially additional ExxonMobil or third-party locations, to deploy FuelCell Energy’s carbonate fuel cell platform to capture carbon dioxide emissions. A decision on the Rotterdam project is expected in 2022, dependent on achieving technical milestones over the next six months. In addition to pilot project deployments, FuelCell Energy and ExxonMobil are discussing the next phase of carbon capture development.

“FuelCell Energy and ExxonMobil continue to advance our joint research and FuelCell Energy technology that is targeted to tackle one of the largest environmental challenges of today, CO₂ emissions from power generation and industrial exhaust streams,” said Jason Few, president and chief executive officer of FuelCell Energy. “Together, we have a great opportunity to scale and commercialize our unique carbon capture solution, one that captures carbon dioxide from various exhaust streams, while generating additional power, unlike traditional carbon capture technologies, which consume significant power. We are encouraged by our results in testing capture of C0₂, and the efficiencies and performance that our fuel cell stacks are able to achieve. We look forward to continuing our work with ExxonMobil on advancing the first pilot test of this platform solution.”

“ExxonMobil is working to develop breakthrough solutions in carbon capture, hydrogen and biofuels and identify commercially viable technologies the world will need to achieve the goals of the Paris Agreement,” said Vijay Swarup, vice president of research and development for ExxonMobil Research and Engineering Company. “We are pleased to continue working with FuelCell Energy to further advance this unique high efficiency carbon capture solution.”

FuelCell Energy’s proprietary technology uses carbonate fuel cells to efficiently capture and concentrate carbon dioxide streams from industrial sources. Combustion exhaust is directed to the fuel cell, which produces power, while capturing and concentrating carbon dioxide for permanent storage. The modular design enables the technology to be deployed at a wide range of locations, which could lead to a more cost-efficient path for deployment of carbon capture and sequestration.

About FuelCell Energy

FuelCell Energy, Inc. (NASDAQ: FCEL): FuelCell Energy is a global leader in sustainable clean energy technologies that address some of the world’s most critical challenges around energy, safety and global urbanization. As a leading global manufacturer of proprietary fuel cell technology platforms, FuelCell Energy is uniquely positioned to serve customers worldwide with sustainable products and solutions for businesses, utilities, governments and municipalities. Our solutions are designed to enable a world empowered by clean energy, enhancing the quality of life for people around the globe. We target large-scale power users with our megawatt-class installations globally, and currently offer sub-megawatt solutions for smaller power consumers in Europe. To provide a frame of reference, one megawatt is adequate to continually power approximately 1,000 average sized U.S. homes. We develop turn-key distributed power generation solutions and operate and provide comprehensive service for the life of the power plant. Our fuel cell solution is a clean, efficient alternative to traditional combustion-based power generation, and is complementary to an energy mix consisting of intermittent sources of energy, such as solar and wind turbines. Our customer base includes utility companies, municipalities, universities, hospitals, government entities/military bases and a variety of industrial and commercial enterprises. Our leading geographic markets are currently the United States and South Korea, and we are pursuing opportunities in other countries around the world. FuelCell Energy, based in Connecticut, was founded in 1969.

SureSource, SureSource 1500, SureSource 3000, SureSource 4000, SureSource Recovery, SureSource Capture, SureSource Hydrogen, SureSource Storage, SureSource Service, SureSource Treatment, SureSource Capital, FuelCell Energy, and FuelCell Energy logo are all trademarks of FuelCell Energy, Inc.

Cautionary Language

This news release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, statements with respect to the Company’s anticipated financial results and statements regarding the Company’s plans and expectations regarding the continuing development, commercialization and financing of its fuel cell technology and its business plans and strategies. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Factors that could cause such a difference include, without limitation, changes to projected deliveries and order flow, changes to production rate and product costs, general risks associated with product development, manufacturing, changes in the regulatory environment, customer strategies, ability to access certain markets, unanticipated manufacturing issues that impact power plant performance, changes in critical accounting policies, access to and ability to raise capital and attract financing, potential volatility of energy prices, rapid technological change, competition, the Company’s ability to successfully implement its new business strategies and achieve its goals, the Company’s ability

to achieve its sales plans and cost reduction targets, changes by the U.S. Small Business Administration or other governmental authorities to, or with respect to the implementation or interpretation of, the Coronavirus Aid, Relief, and Economic Security Act, the Paycheck Protection Program or related administrative matters, and concerns with, threats of, or the consequences of, pandemics, contagious diseases or health epidemics, including the novel coronavirus, and resulting supply chain disruptions, shifts in clean energy demand, impacts to customers’ capital budgets and investment plans, impacts to the Company’s project schedules, impacts to the Company’s ability to service existing projects, and impacts on the demand for the Company’s products, as well as other risks set forth in the Company’s filings with the Securities and Exchange Commission. The forward-looking statements contained herein speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any such statement to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which any such statement is based.

Contact:

FuelCell Energy, Inc.

ir@fce.com

203.205.2491

Source: FuelCell Energy

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