- Current report filing (8-K)
March 02 2009 - 11:43AM
Edgar (US Regulatory)
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
):
February
25, 2009
(Exact
name of registrant as specified in its charter)
(State or
other jurisdiction of incorporation)
33-46104-FW
|
71-00659511
|
(Commission
File Number)
|
(IRS
Employer Identification
No.)
|
124 West Capitol Avenue, Suite 880, Little Rock,
Arkansas
|
72201
|
(Address
of principal executive offices)
|
(Zip
Code)
|
(Registrant’s
telephone number, including area code)
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):
o
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o
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
February 25, 2009, our subsidiary, ThermoEnergy Power Systems, LLC (“TEPS”) and
Babcock Power Development, LLC (“BPD”), a subsidiary of Babcock Power,
Inc., entered into a Limited Liability Company Agreement (the “LLC
Agreement”) confirming the formation of Babcock-Thermo Carbon Capture LLC, a
Delaware limited liability company (the “Joint Venture”) for the purpose of
developing and commercializing our proprietary clean energy technology known as
“ThermoEnergy Integrated Power System” (“TIPS”). TIPS is a
pressurized oxy-fuel combustion technology for multi-pollutant capture that
gasifies or combusts fossil fuels (particularly coal and biomass) and
facilitates conversion into electricity without producing air emissions, and is
aimed at competing with conventional energy conversion
technologies.
TEPS has
entered into a license agreement with the Joint Venture and BPD, pursuant to
which it has granted to the Joint Venture an exclusive (even as to TEPS),
irrevocable (except as otherwise provided therein), world-wide, fully paid up
and royalty-free license to TEPS’s intellectual property related to or necessary
to practice the TIPS technology (the “TIPS License”). In the
LLC Agreement, BPD has agreed to develop, at its own expense, intellectual
property in connection with three critical subsystems relating to the TIPS
technology: a combuster subsystem, a steam generating heating surface subsystem,
and a condensing heat exchangers subsystem (collectively, the “Subsystems”)
and BPD has entered into a license agreement with the Joint Venture
and TEPS pursuant to which it has granted the Joint Venture an exclusive,
irrevocable (except as otherwise provided therein), world-wide, fully paid up
and royalty-free license to BPD’s know-how and other proprietary intellectual
property related to or necessary to practice the Subsystems.
Pursuant
to the LLC Agreement, each of TEPS and BPD owns a 50% membership interest in the
Joint Venture. The LLC Agreement provides that each member may be
required, from time to time, to make capital contributions to the Joint Venture
to fund its operations. The Joint Venture will be managed by a
six-person Board of Managers, with three managers appointed by each
member. The initial TEPS representatives on the Board of Managers
will be Dennis C. Cossey, our Chairman and CEO, Shawn R. Hughes, our President
and Chief Operating Officer, and Alexander G. Fassbender, our Executive Vice
President and Chief Technology Officer, who is the principal inventor of
TIPS. Dr. Fassbender will serve as Chairman and Chief Technology
Officer of the Joint Venture and Eric Balles, the Chief Operating Officer and
Senior Vice President – Engineering and Technology of Babcock Power
Environmental Inc., will serve as President and Chief Executive Officer of the
Joint Venture.
The Board
of Managers has adopted a set of milestones by which it will measure the
progress of the Joint Venture. Pursuant to the LLC Agreement, either
member may withdraw from the Joint Venture if any milestone is not met (unless
the failure to meet such milestone is primarily attributable to a failure by
such member to perform its obligations under the LLC Agreement or any related
agreements). If a member exercises its right to withdraw,
the license that such member has granted to the Joint Venture will automatically
terminate.
The LLC
Agreement obligates the Joint Venture and each member to indemnify and hold the
other member and its affiliates harmless against damages and losses resulting
from such member’s fraud, gross negligence or intentional misconduct with
respect to the Joint Venture. We and Babcock Power, Inc. have entered
into separate agreements to indemnify the joint venture and its members (other
than our respective subsidiary-members) and their respective affiliates against
damages and losses resulting from fraud, gross negligence or intentional
misconduct of our respective subsidiary-members with respect to the Joint
Venture (each, a “Parent Indemnification Agreement”).
The LLC
Agreement contains other conventional terms, including provisions relating to
governance of the entity, allocation of profits and losses, and restrictions on
transfer of a member’s interest.
In
connection with the formation of the Joint Venture, we and Dr. Fassbender
entered into an Amendment to his Employment Agreement. Among other
things, the Amendment provides that Dr. Fassbender will not compete against our
business or the business of any of our subsidiaries following termination of his
Employment Agreement. With respect to the business of the Joint
Venture, Dr. Fassbender’s non-competition covenant extends for two years
following termination of his Employment Agreement. With respect to
our business and that of our other subsidiaries (including TEPS), the
non-competition term is one year following termination of Dr.
Fassbender’s Employment Agreement.
The
LLC Agreement, the TIPS License, the TEPS Parent
Indemnification Agreement and the Amendment to Dr. Fassbender’s Employment
Agreement are filed as Exhibits 10.1, 10.2, 10.3 and 10.4, respectively, to this
Current Report on Form 8-K, and the foregoing descriptions are qualified in
their entirety by reference to such Exhibits.
Item
9.01
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Financial
Statements and Exhibits
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Exhibit
No.
|
|
Description
|
|
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10.1
|
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Limited
Liability Company Agreement of Babcock-Thermo Carbon Capture LLC, dated as
of February 25, 2009
|
|
|
|
10.2
|
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TEPS
License Agreement, dated as of February 25, 2009
|
|
|
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10.3
|
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Agreement
to Indemnify Certain Members of Babcock-Thermo Carbon Capture LLC, dated
as of February 25, 20009
|
|
|
|
10.4
*
|
|
Amendment
to Employment Agreement by and between Alexander G. Fassbender and
ThermoEnergy Corporation, dated as of February 25, 2009
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|
|
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*
|
|
May
be deemed a compensatory plan or
arrangement
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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.
Date: March
2, 2009
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ThermoEnergy Corporation
|
|
(Registrant)
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|
|
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By:
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/s/ Andrew T. Melton
|
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Name:
Andrew T. Melton
|
|
Title:
Executive Vice President and Chief
Financial
Officer
|
ThermoEnergy (CE) (USOTC:TMEN)
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