Form 8-K for UNIQUE MOBILITY INC filed on May 11 1999 2:01PM
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934
May 10, 1999
Date of Report ( Date of earliest event reported)
Unique Mobility, Inc.
(Exact name of registrant as specified in its charter)
1-10869
(Commission file number)
Colorado 84-0579156
(State or other jurisdiction of incorporation) (IRS Employer Identification
No.)
425 Corporate Circle, Golden, Colorado 80401
(Address of principal executive offices)
(303) 278-2002
(Registrant's telephone number, including area code)
ITEM 5. OTHER EVENTS
On May 10, 1999, Unique Mobility, Inc. ("Unique"), Energy Conversion Devices
("ECD") and EV Global Motors Company ("EVG) formed a German private company,
Unique Mobility Europa GmbH ("UME"), to manufacture battery-electric,
hybrid-electric and fuel cell-electric vehicles. UME is headquartered in
Mittweida, near Leipzig, in the Free State of Saxony, Germany.
UME's planned initial product offerings are expected to be a battery-electric
(zero emission) two-passenger cargo van and a six-passenger commuter van. The
vehicle design was developed in cooperation with Storz Design of Zel am See,
Austria, with engineering support by Design and Concepts Engineering of Bosau,
Germany.
UME has been initially capitalized with DM50,000 cash and a contribution to
surplus of 625,000 shares of Unique's common stock. Of the stock contribution,
208,333 shares were contributed by each of ECD and Unique, 118,750 shares by
EVG and 89,584 shares by Haco Trading Ltd. ("HACO"), an investment fund.
The shares contributed by Unique were newly issued shares. The shares
contributed by ECD and EVG were previously acquired, in privately negotiated
transactions. The shares contributed by HACO were purchased on the open market.
As a result of the initial capitalization, ownership of share interests in UME
are presently as follows: 33.6 percent for Unique; 33.2 percent for ECD;
19.0 percent for EVG; and 14.2 percent for HACO. Based on the market value of
the newly issued common shares on the closing date, May 10, 1999, Unique will
record its investment in UME at $1,210,831 and account for its investment under
the equity method of accounting. Under the equity method of accounting,
Unique will record its proportionate share of the earnings or losses of UME in
its statement of operations and as an increase or decrease, respectively, in the
carrying value of its investment.
EV Global has agreed, subject to certain conditions and contingent upon
maintaining a share interest of less than 19 percent, to make an additional
contribution to UME in the amount of either $503,910 in cash or, at EVG's
option, 89,583 shares of Unique stock, in exchange for an additional share
interest in UME sufficient to raise its share interest to equal that then held
by Unique and ECD. Unique does not intend, nor does it have any obligation, to
make further capital contributions to UME.
An investment banking firm has been engaged to obtain additional funding for
UME by means of the private placement of up to $50 million from the sale of
equity or debt securities of UME and Unique stock held by UME. There can be
no assurance that financing can be completed on terms acceptable to UME.
At such time as Unique's share interest in UME is diluted to less than
20 percent, Unique would change its method of accounting for its investment in
UME from the equity method to the cost method of accounting. Under the cost
method, Unique's investment in UME would be established at its recorded value
on the date Unique's ownership decreases below twenty percent and Unique
thereafter would discontinue recording its proportionate share of the earnings
or losses of UME.
In addition to the financing described above, UME intends to apply for
government financial support to fund a material portion of future operations
and capital requirements. Both the German federal government and the Free
State of Saxony have currently existing programs to provide grant money for
pre-project and product development costs, as well as investments for plant
sites, buildings, production tooling and equipment. However, there can be no
assurance that the currently existing government grant programs will be
continued or that such grants will be available to UME.
Pursuant to a May 10, 1999 Shareholders Agreement by and between Unique, ECD,
EVG and HACO, each shareholder has acknowledged that it is entering into the
transaction with the intention of using its expertise to facilitate UME's
success. To that end, each shareholder has agreed to cause UME to enter into
definitive agreements providing that: (i) Unique will grant a license and have
the exclusive right to manufacture and supply electric and hybrid-electric
propulsion systems to UME, (ii) ECD will have the exclusive right to supply
batteries and battery charging systems to UME, and (iii) EVG will have
exclusive distribution rights to the electric vans in North America.
Pursuant to an agreement with Handelsgruppe K.G.Techno-Einkauf GmbH & Co.
("TECHNO/TECAR"), TECHNO/TECAR will distribute the products of UME throughout
continental Europe. TECHNO/TECAR is a cooperation of the leading franchised
dealers of Audi, BMW, Fiat, Ford, DaimlerChrysler, Opel, Volvo and Volkswagen.
It is headed by two of Volkswagen's largest and most influential dealers:
Mr. Fritz Haberl (MAHAG Munich) and Mr. Bernhard Enning (Reckinghausen).
Haberl is the largest new car dealer in Europe and is Chairman of TECHNO/TECAR.
Both Messrs. Haberl and Enning have provided and have agreed to continue to
provide market and product planning consultation to UME.
In a separate transaction, Unique intends to participate with EVG in the
environmentally sensitive development of Windermere Island in the Bahamas
by Windermere Eco Development Limited, a Bahamian company ("WED"). Windermere
Island is one of the few pristine properties remaining in the Bahamas and is
being developed as a world class showcase for electric transportation. Unique
expects to acquire an approximately 9.5 percent participation in a
$5.225 million loan from EVG to WED for $500,000 in cash. The entire loan is
convertible into approximately 50.4 percent of the total outstanding equity of
WED. Therefore, if EVG converts the loan, Unique will have the right to
receive approximately 4.82 percent of the equity of WED.
In order to fund its participation in the Windermere transaction, the Company
is negotiating to sell newly issued shares of its common stock to VTZ
Versicherungs Treuhand Zurich AG ("VTZ") in a transaction exempt from
registration under Regulation D. VTZ is an environmental investment fund,
existing shareholder of Unique and sponsor of the Windermere Island
development. The number of shares issued to VTZ shall be determined based
on the closing price of Unique's common stock on the American Stock Exchange
for the ten trading days immediately preceding the date of closing.
EVG beneficially owns 978,864 shares of Unique representing approximately
6 percent of the outstanding common stock and Mr. Iacocca, EVG's Chairman and
Chief Executive Officer, serves on Unique's Board of Directors. |
