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) July 14, 2005
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ABLE ENERGY, INC.
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(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 001-15035 22-3520840
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(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
198 Green Pond Road, Rockaway, New Jersey 07866
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(Address of Principal Executive Offices) (Zip Code)
(973) 625-1012
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(Registrant's Telephone Number, Including Area Code)
(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 8.1 OTHER EVENTS
On July 12, 2005, we consummated a financing with certain purchasers
identified in the Securities Purchase Agreement dated as of July 12, 2005
(collectively the "Purchasers"), in the amount of $2.5 Million Dollars.
The following description of the terms of our financing is qualified in
its entirety by the terms and provisions contained in the financing
documentation attached to this Current Report on Form 8-K as Exhibits 99.1
through 99.4.
Pursuant to the terms of the Securities Purchase Agreement dated as of
July 12, 2005 (the "Agreement") among Able Energy, Inc., and the Purchasers, the
Purchasers purchased Debentures in the aggregate amount of $2.5 Million Dollars
evidenced by a Variable Rate Convertible Debenture also dated July 12, 2005 (the
"Debenture"). The Debentures shall be repaid within two years from the date of
issuance, subject to the occurrence of an event of default, with interest
payable at the rate per annum equal to LIBOR for the applicable interest period,
plus 4% payable on a quarterly basis on April 1st, July 1st, October 1st and
January 1st, beginning on the first such date after the date of issuance of the
Debentures. The Debentures may be converted at the option of the Purchasers into
shares of our common stock at a conversion price of $6.50 per share. In
addition, the Purchasers shall have the right to receive five (5) year warrants
to purchase 192,308 of common stock at an exercise price of $7.15 per share.
Pursuant to the Agreement, we shall also have an optional redemption right
(which right shall be mandatory upon the occurrence of an event of default) to
repurchase all of the Debentures for 125% of the face amount of the Debentures
plus all accrued and outstanding interest and expenses, as well as a right to
repurchase all of the Debentures in the event of the consummation of a new
financing in which we sell securities at a purchase price that is below the
Conversion Price.
Pursuant to the Registration Rights Agreement among the parties, the
Purchasers shall have demand registration rights with respect to all shares of
our common stock obtained by them through the conversion of the Debentures. The
Purchasers shall also have an additional investment right, for a period of nine
months after the initial registration statement is filed by us with the
Securities and Exchange Commission (the "SEC") is first declared effective by
the SEC, to purchase units consisting of convertible debentures in the aggregate
amount of up to $15,000,000 (the "Additional Debentures") and common stock
purchase warrants equal to 50% of the face amount of such Additional Debentures
(the "Additional Warrants"). The conversion price of the Additional Debentures
shall be $6.50 per share of common stock with respect to the first $5,000,000 of
Additional Debentures purchased, $7.50 per share of common stock for the second
$5,000,000 of Additional Debentures purchased and 80% of the average weighted
price of our common stock during the 20 trading days immediately prior to the
Purchasers' election to purchase the third $5,000,000 of Additional Debentures.
The Additional Warrants shall have a five-year term and an exercise price of
110% of the conversion price. In the event of the occurrence of a default with
respect to the Additional Debentures, we shall have identical redemption rights
to those described in the
immediately preceding paragraph. Moreover, the Company shall have the right to
cause the Purchasers' on a pro rata basis, based on the percentage of their
purchase of Debentures, to exercise their Additional Investment Right; however,
each Purchaser may refuse to exercise their respective purchase right, but in
such event, the Purchaser waives its right to purchase the Additional
Debentures. The Agreement provide that, commencing 90 days following the
Effective Date (the date the initial registration statement is declared
effective by the SEC), and ending on the 179th calendar day with regard to the
first $5,000,000 in Additional Debentures, if the average weighted price of our
stock for any 20 consecutive trading day period, during said period, exceeds
$7.80 per share. We also have a similar right with regard to the second
$5,000,000 if our stock during the period commencing 180 days, following the
Effective Date through the 269th day, for any 20 consecutive trading day period,
exceeds $9.00 per share and for the period 270 days following the Effective Date
through the 360th calendar day, we have a similar right with regard to the third
$5,000,000 traunche if our stock exceeds $10.20.