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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): December 22, 1995
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Environmental Power Corporation
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(Exact Name of Registrant as specified in its charter)
Delaware 0-15472 04-2782065
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(State of other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) No.)
31 Raynes Avenue, Portsmouth, NH 03801
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(Address of principal executive offices)
(603) 431-1780
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(Registrant's telephone number
including area code)
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Item 5. Other Events.
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A wholly-owned subsidiary of the Registrant, Buzzard Power Corporation
(the "Lessee"), entered into a long-term lease with Scrubgrass Generating
Company, L.P. (the "Lessor") in June 1994 for a waste coal-fire electric
generating station in Pennsylvania (the "Scrubgrass Project"). The Lessee's
rent obligation for the Scrubgrass Project includes principal and interest
payable by the Lessor.
On December 22, 1995, the Lessor refinanced certain debt owed by it in
connection with the Scrubgrass Project. As part of the refinancing, certain
demand debt owed by the Lessor was replaced by a term loan payable over the next
eight years. As a result of the refinancing, approximately $3,000,000 of the
Lessee's rent expense (and the associated liability) which would otherwise have
accrued through the end of 1995 will instead be spread over the eight- year life
of the Lessor's new term loan, based on the amortization schedule therefor.
Consequently, the Registrant's rent expense was reduced by approximately
$3,000,000 in the fourth quarter of 1995.
The Registrant's September 30, 1995 unaudited consolidated balance
sheet included shareholders' equity of $1,422,704, which failed to comply with
NASDAQ's minimum requirement of $2,000,000 for a small capitalization company
with a bid price less than $1.00 per share. However, largely as a result of the
refinancing by the Lessor and improved fourth quarter operating results of the
Registrant (the effects of which were partially offset by dividends paid and a
reduction in tax benefits), Registrant's shareholders' equity as of December 31,
1995,
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exceeded the minimum $2,000,000 requirement, as demonstrated by the
condensed, unaudited consolidated balance sheet information of the Registrant
set forth below:
<TABLE>
<CAPTION>
December 31, 1995
(unaudited)
($ in 1000's)
<S> <C>
ASSETS
Current assets...................... $12,685
Other assets........................ 31,261
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Total assets..................... $43,946
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities................. $ 8,261
Other liabilities................... 32,776
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Total liabilities................ $41,037
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Shareholders' equity $ 2,909
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Total liabilities and shareholders' equity $43,946
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</TABLE>
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Signature
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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.
Environmental Power Corporation
Date: January 31, 1996 By: /s/ Bayard R. Kraft, III
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Bayard R. Kraft, III
Treasurer, Chief Financial
Officer and Secretary
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