Attached files
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| EX-10.1 - GlyEco, Inc. | ex10-1.htm |
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 3, 2012
GLYECO, INC.
(Exact Name of Registrant as Specified in Its Charter)
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Nevada
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000-30396
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45-4030261
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(State or Other Jurisdiction of Incorporation)
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(Commission File Number)
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(IRS Employer Identification No.)
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4802 East Ray Road, Suite 23-196
Phoenix, Arizona
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85044
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(Address of Principal Executive Offices)
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(Zip Code)
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Registrant’s telephone number, including area code: (866) 960-1539
N/A
(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):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 1.01 Entry into a Material Definitive Agreement.
As previously reported by GlyEco, Inc., a Nevada corporation (the “Company”) on a Current Report on Form 8-K filed by the Company with the Securities and Exchange Commission (the “Commission”) on June 13, 2012, the Company entered into a preliminary agreement (the “Preliminary Agreement”) with Antifreeze Recycling, Inc., a South Dakota corporation (“ARI”), dated June 7, 2012, pursuant to which the Company agreed to purchase from ARI all of its glycol-related assets, free and clear of any liabilities or encumbrances, contingent, in part, on the Company and ARI completing a comprehensive asset purchase agreement (the “Acquisition”).
On October 3, 2012, GlyEco Acquisition Corp. #7, an Arizona corporation and wholly-owned subsidiary (“Acquisition Sub”) of the Company, entered into an Asset Purchase Agreement (the “Agreement”) with ARI and Mr. Robert J. Kolhoff, the selling principal of ARI (the “Selling Principal”). The Agreement supersedes the terms of the Preliminary Agreement.
ARI operates a business located in Tea, South Dakota, relating to processing used glycol streams, primarily used antifreeze, and selling glycol as remanufactured product.
Pursuant to the Agreement, Acquisition Sub has agreed to purchase on October 26, 2012, or on such later date as agreed upon by the parties (the “Closing”), all of the glycol-related assets of ARI, free and clear of any liabilities or encumbrances, consisting of ARI’s personal property (equipment, tools, machinery, furniture, supplies, materials, and other tangible personal property), inventory, intangible property, contractual rights, books and records, intellectual property, accounts receivable (excluding trade accounts receivable equal to or greater than 90 days), goodwill, and miscellaneous assets.
The Agreement states that the aggregate purchase price (the “Purchase Price”) for the Assets shall be $450,000, consisting of 361,200 unregistered shares (the “Shares”) of the Company’s common stock (the “Common Stock”), subject to adjustment, at an agreed upon value of $1.00 per Share, and assumption of debt in an amount of $88,800. The Purchase Price is based on ARI having a Net Working Capital (as defined in the Agreement) of $15,000 at Closing. The Agreement states that the Purchase Price be decreased to the extent that ARI’s Net Working Capital is less than $15,000 at Closing. If, however, ARI’s Net Working Capital is greater than $15,000 at Closing, the Company has agreed to pay the full amount of such overage within 15 business days of the Closing.
At the Closing, the Company will pay or cause to be paid to ARI 261,200 Shares, and the Company will satisfy or otherwise assume from ARI $88,800 in debt. The Company will also place 100,000 Shares in escrow (“Escrow”) to secure the obligations, representations and warranties and indemnification obligations of ARI and the Selling Principal under the Agreement and Ancillary Documents (as defined in the Agreement). Shares may be cancelled and retained by the Company from the Escrow, from time-to-time (on a one Share basis for each dollar liability) in connection with any liabilities indemnified by ARI or Selling Principal pursuant to the terms and conditions of the Agreement and the Ancillary Documents. Any Shares remaining in Escrow, after adjustments permitted under the Agreement, on the first anniversary of the Closing, shall be released and delivered to the extent there remain no further liabilities for which the Company has notice that would be covered by the indemnification obligations under the Agreement.
The Agreement also provides that on the Closing Date, the Company will enter into (i) an employment letter with the Selling Principal pursuant to which the Selling Principal shall serve as the General Manager of Acquisition Sub at an agreed upon salary and bonus structure, and (ii) a lease agreement pursuant to which the Company shall lease the real property where ARI’s business operations are being conducted. The terms of the employment letter and lease agreement will be finalized by the Closing.
The consummation of the Acquisition is subject to the satisfaction or waiver of customary representations and warranties by the parties to the Agreement, and the preparation and delivery of disclosure schedules and other documentation by the parties to the Agreement.
The foregoing description of the Agreement is qualified in its entirety by reference to the Asset Purchase Agreement, a copy of which is filed as an exhibit to this Form 8-K and incorporated by reference into this Item 1.01.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
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Exhibit
Number:
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Description of Exhibit:
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10.1
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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 thereunto duly authorized.
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GLYECO, INC.
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Dated: October 9, 2012
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By:
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/s/ John Lorenz
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John Lorenz
President and Chief Executive Officer, Director
(Principal Executive Officer)
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