Schedule 13D
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
ELECTRIC CITY CORP.
(Name of Issuer)
COMMON STOCK, $0.0001 PAR VALUE
(Title of Class of Securities)
284868106
(CUSIP Number)
JOHN G. MOORE
LEAF MOUNTAIN COMPANY, LLC
190 S. LASALLE STREET, SUITE 1700
CHICAGO, ILLINOIS 60603
312-346-4101
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
NOVEMBER 29, 2001
(Date of Event which Requires Filing of this Statement)
284868106
CUSIP No.
1.Names of Reporting Persons. I.R.S. Identification Nos. of
above persons
entities only).
LEAF MOUNTAIN COMPANY, LLC
36-4001435
2.Check the Appropriate Box if a Member of a Group (See
Instructions)
(a)
(b)..X SEE ITEMS 5 AND 6
3.SEC Use Only
4.Source of Funds (See Instructions)
WC
5.Check if Disclosure of Legal Proceedings Is Required Pursuant
to Items 2(d) or 2(e)
N/A
6.Citizenship or Place of Organization
Illinois
7 Number of Shares Beneficially Owned by Each Reporting Person
With 7.Sole Voting Power
4,216,997
8.Shared Voting Power
N/A
9.Sole Dispositive Power
4,216,997
10.Shared Dispositive Power
N/A
11.Aggregate Amount Beneficially Owned by Each Reporting Person
4,216,997
12.Check if the Aggregate Amount in Row (11) Excludes Certain
Shares (See Instructions)
X
SEE ITEMS 5 AND 6
13.Percent of Class Represented by Amount in Row (11)
11.9% BASED ON 31,068,719 OUTSTANDING
14.Type of Reporting Person (See Instructions)
00 - LIMITED LIABILITY COMPANY
Item 1.Security and Issuer
Common Stock, $0.0001 par value ("Common Stock"), of Electric
City Corp., 1280 Landmeier Road, Elk Grove Village, Illinois
60007 (the "Company")
Item 2.Identity and Background
Leaf Mountain Company, L.L.C. ("Leaf Mountain") is a limited
liability company organized under the laws of the State of
Illinois. Leaf Mountain's principal business address and office
is located at 190 South LaSalle Street, Suite 1700, Chicago,
Illinois 60603. The principal business of Leaf Mountain is
investment. There are ten (10) individual members of Leaf
Mountian and one general partnership member comprised of two
(2) of the individual members. No member has a controlling
vote.
John J. Jiganti is the Managing Director of Leaf Mountain.
Information regarding Mr. Jiganti is as follows:
(a) Name: John J. Jiganti
(b) Business Address: 190 S. LaSalle Street, Suite 1700
Chicago, Illinois 60603
(c) Principal Occupation: Attorney
Madden, Jiganti, Moore & Sinars
190 S. LaSalle Street, Suite 1700
Chicago, Illinois 60603
(d) Mr. Jiganti has not during the last five years been
convicted in a criminal proceeding.
(e) Mr. Jiganti has not during the last five years been a party
to a civil proceeding of a judicial or administrative body which
resulted in a judgment, decree or order enjoining, prohibiting
or mandating activities subject to federal or state securities
laws or finding any violation with respect to such laws.
(f) Mr. Jiganti is a U.S. Citizen.
Gerald A. Pientka is a member of Leaf Mountain having an
interest limited to 2.48% of Leaf Mountain's investment in the
Company's securities. Mr. Pientka has been a member of the
Board of Directors of Company since 2000.
Mr. Pientka is a U.S. Citizen whose business address is 101 East
Erie Street, Suite 800, Chicago, Illinois. He is a co-founder
of Higgins Development Partners, LLC, a national real estate
development company headquartered in Chicago. Mr. Pientka has
served as the President of Higgins Development Partners since
its inception in May, 1999. He had previously served as
President of its predecessor company, Walsh, Higgins & Company
from May, 1992 until May, 1999.
Mr. Pientka directly owns 22,000 shares of the common stock of
the Company. In addition, Mr. Pientka holds various options to
purchase shares of the common stock of the Company which if
exercised total 91,667 shares.
Mr. Pientka, as a member of the Board of Directors of the
Company, has expressly recused himself from and will not vote or
participate in any discussion relating to Leaf Mountain's
investment in the securities of the Company. Mr. Pientka, as a
member of Leaf Mountain, has no right to participate in any vote
or decision pertaining to Leaf Mountain's investment in the
securities of the Company.
Item 3.Source and Amount of Funds or Other Consideration
Leaf Mountain entered into a Securities Purchase Agreement,
dated as of November 29, 2001, with the Company (the "Securities
Purchase Agreement") to acquire certain classes of the Company's
securities. Leaf Mountain purchased $3,000,000 of the Company's
securities as described more fully below.
The source of funds for Leaf Mountain's purchase of the
securities pursuant to the Securities Purchase Agreement came
from Leaf Mountain's working capital.
Leaf Mountain is currently deemed to have beneficial ownership
of the securities to be issued pursuant to the Securities
Purchase Agreement because it owns Common Stock directly or has
the right to acquire Common Stock indirectly through the
conversion of the Convertible Preferred Stock (defined below) or
the exercise of warrants to purchase Common Stock or Convertible
Preferred Stock, as applicable.
It is anticipated that the source of funds for Leaf Mountain's
exercise of the warrants issued under the Securities Purchase
Agreement will be provided by Leaf Mountain's working capital.
Item 4.Purpose of Transaction
Leaf Mountain acquired for investment purposes $3,000,000 of the
Company's securities, consisting of 300,000 shares of Series A
Convertible Preferred Stock ("Convertible Preferred Stock"),
warrants to purchase 75,000 shares of Convertible Preferred
Stock, 45,122 shares of Common Stock and warrants to purchase
421,875 shares of Common Stock pursuant to the Securities
Purchase Agreement.
Leaf Mountain has the right to designate an "observer" to the
Company's Board of Directors. The Observer may attend all
meetings of the Board of Directors and receive all related
information but has no rights to vote as a director.
Leaf Mountain expects to evaluate on a continuing basis its
goals and objectives and general economic and equity market
conditions, as well as the Company's business operations and
prospects. Based on such evaluations, from time to time in the
future, Leaf Mountain may (1) convert the Convertible Preferred
Stock into Common Stock, (2) exercise the warrants to purchase
the Convertible Preferred Stock, and subsequently convert such
stock into Common Stock, or (3) exercise the warrants to
purchase Common Stock for investment purposes. Leaf Mountain
may also make additional purchases of the Company's Common
Stock. Leaf Mountain may, subject to the Investor Rights
Agreement (defined below) and the Stock Trading Agreement
(defined below), from time to time sell all or a portion of the
Common Stock that it now holds either in private placements, in
the open market pursuant to Rule 144, and/or pursuant to
Regulation S and other available exemptions from the
registration requirements of the Securities Act of 1933.
Except as set forth above, neither Leaf Mountain nor, to the
knowledge of Leaf Mountain, John J. Jiganti has any plans or
proposals that relate to or would result in any of the matters
referred to in paragraphs (a) through (j) of Item 4 of Schedule
13D. Leaf Mountain, however, may at any time and from time to
time, review or reconsider its position with respect to any of
such matters.
Item 5.Interest in Securities of the Issuer
(a) Leaf Mountain entered into the Securities Purchase Agreement
to acquire certain classes of the Company's securities. Under
the terms of the Securities Purchase Agreement, Leaf Mountain
purchased 300,000 shares of Convertible Preferred Stock,
warrants to purchase 75,000 shares of Convertible Preferred
Stock, 45,122 shares of Common Stock and warrants to purchase
421,875 shares of Common Stock. By way of a Securities Purchase
Agreement dated July 31, 2001 which was consummated September 7,
2001, five (5) other (i.e. independent of Leaf Mountain)
investors (the "Additional Investors") acquired certain classes
of the Company's securities. The Additional Investors
purchased, in the aggregate, 1,600,000 shares of Convertible
Preferred Stock, warrants to purchase 400,000 shares of
Convertible Preferred Stock, 320,868 shares of Common Stock and
warrants to purchase 3,000,000 shares of Common Stock.
Additionally, in partial consideration for Newcourt Capital
Securities, Inc.'s ("Newcourt") services as a placement agent in
connection with the Securities Purchase Agreement of the
Additional Investors, the Company issued to Newcourt warrants to
purchase 3,314,830 shares of its Common Stock ("Placement Agent
Warrants").
Leaf Mountain disclaims beneficial ownership of shares of Common
Stock beneficially owned by the Additional Investors and
Newcourt. Leaf Mountain also disclaims beneficial ownership of
shares of Common Stock beneficially owned by Gerald A. Pientka
(See Item 2 above). Therefore, Leaf Mountain beneficially owns
4,216,997 shares of Common Stock on an as converted basis. This
number includes 4,171,885 shares of Common Stock which Leaf
Mountain has a right to acquire pursuant to the exercise of the
warrants to purchase Common Stock and Convertible Preferred
Stock and the conversion of the Convertible Preferred Stock.
Based on the 31,068,719 of shares of Common Stock issued and
outstanding as of November 29, 2001, Leaf Mountain may be deemed
the beneficial owner of approximately 11.9% of the outstanding
Common Stock.
Except as otherwise described herein, none of the members of
Leaf Mountain are the beneficial owners of any shares of Common
Stock purchased or to be purchased by Leaf Mountain.
(b) Leaf Mountain has the sole power to vote and direct the
vote or to dispose or direct the disposition of 4,216,997 shares
of Common Stock on an as converted basis. Leaf Mountain
disclaims beneficial ownership of shares of Common Stock
beneficially owned by the Additional Investors, Newcourt or
Gerald A. Pientka.
As Managing Director of Leaf Mountain, John J. Jiganti has the
sole power to vote or direct the vote or dispose of or direct
the disposition of any shares of Common Stock purchased or to be
purchased by Leaf Mountain.
(c) See Item 6 below.
(d) No other person is known to have the right to receive or
the power to direct the receipt of dividends from, or the
proceeds from the sale of, the Common Stock purchased or to be
purchased by Leaf Mountain.
Item 6.Contracts, Arrangements, Understandings or Relationships
with
Respect to Securities of the Issuer
On November 29, 2001, Leaf Mountain entered into the Securities
Purchase Agreement with the Company. The transactions
contemplated by the Securities Purchase Agreement were
consummated on November 29, 2001. Pursuant to the terms of the
Securities Purchase Agreement, Leaf Mountain purchased for
$3,000,000 the following securities:
1. 300,000 shares of Convertible Preferred Stock;
2. Warrants to purchase 75,000 shares of Convertible Preferred
Stock at an initial exercise price of $10.00 per share;
3. 45,122 shares of Common Stock; and
4. Warrants to purchase 421,875 shares of Common Stock at an
initial exercise price of $1.00 per share.
The Convertible Preferred Stock is convertible into shares of
Common stock at the option of the holder as determined by
dividing $10.00 by the conversion price, which has been
initially set at $1.00, multiplied by each share of Convertible
Preferred Stock, subject to adjustments as set forth in the
Securities Purchase Agreement. Based on the initial conversion
ratio, Leaf Mountain has the right to acquire 3,750,000 shares
of Common Stock as the result of the conversion of the
Convertible Preferred and the exercise of the warrants to
purchase Convertible Preferred Stock. Each outstanding share of
Convertible Preferred Stock is entitled to dividends at a rate
of 10% per year of its stated value, which is $10.00. The
Company may pay dividends in cash or additional shares of
Convertible Preferred Stock until the first dividend payment
that occurs after three years following the initial issuance of
the Convertible Preferred Stock. After that date, dividends
must be paid in cash and the dividend rate increases 0.5% every
six months to a maximum rate of 15% per year.
In connection with the Securities Purchase Agreement, Leaf
Mountain and the Company entered into a Joinder Agreement dated
November 29, 2001 (the "Joinder Agreement") and a Consent and
Amendment of Securities Agreement, Stock Trading Agreement,
Stockholders Agreement and Investor Rights Agreement dated
November 29, 2001 (the "Consent Agreement") whereby Leaf
Mountain became a party to certain ancillary agreements -- the
Investor Rights Agreement, the Stockholders Agreement and the
Stock Trading Agreement which were originally adopted by the
Company and the Additional Investors. Under the terms of the
Investor Rights Agreement, dated as of July 31, 2001 as amended
by the Consent Agreement, (the "Investor Rights Agreement"),
between the Company, Leaf Mountain, the Additional Investors and
Newcourt, Leaf Mountain, the Additional Investors and Newcourt
have the right to require the Company to register the shares of
Common Stock received directly or indirectly pursuant to the
Securities Purchase Agreements. Leaf Mountain, the Additional
Investors and Newcourt, as a group, have the right to demand an
aggregate of four registrations provided that each registration
represents at least $5 million of market value. Leaf Mountain
has an independent right to demand one registration provided
that it represents at least 750,000 shares of the Common Stock
of the Company. Leaf Mountain, the Additional Investors and
Newcourt are also entitled to customary "piggyback" registration
rights. Under the Investors Rights Agreement, Leaf Mountain,
the Additional Investors and Newcourt have preemptive rights
with respect to future sales by the Company of its capital stock
to permit such parties to maintain their percentage ownership
interests.
Under the Stockholders Agreement dated July 31, 2001, as amended
by the Consent Agreement, (the "Stockholders Agreement"), each
Additional Investor (with two of the investors being treated as
one) has the right to designate one member to the Board of
Directors and to have a representative attend all meetings of
the Board of Directors as a board observer so long as it holds
at least 200,000 shares of Convertible Preferred Stock. Under
the terms of the Stockholders Agreement, as long as Leaf
Mountain holds 100,000 shares of Convertible Preferred Stock, a
representative of Leaf Mountain is entitled to attend all
meetings of the Board of Directors as an observer. Each
investor also agrees that if it converts more than 50% of the
Convertible Preferred Stock it purchases under the Securities
Purchase Agreement, it will, at the request of the Company,
convert the remainder of its Convertible Preferred Stock.
On July 31, 2001, the Additional Investors, Newcourt and certain
officers of the Company entered into the Stock Trading Agreement
(the "Stock Trading Agreement") that limits the ability of the
Additional Investors, Newcourt and such officers (the
"Restricted Parties") to sell Common Stock into the public
market. The Stock Trading Agreement originally became effective
on September 7, 2001. Leaf Mountain became a party to the Stock
Trading Agreement as amended by the Consent Agreement on
November 29, 2001. The Restricted Parties may not sell their
shares of Common Stock until the Company has completed a
qualified primary offering, as set forth in the Stock Trading
Agreement, without complying with the sale restrictions set
forth in such agreement. In general, if the Company does not
complete a qualified public offering within 18 months after the
closing of the applicable Securities Purchase Agreement, the
parties may sell their shares subject to certain trading volume
and block sale limitations set forth in the Stock Trading
Agreement. With respect to 25% of the share holdings of Leaf
Mountain, shares may be sold 12 months after November 29, 2001
subject to certain trading volume limitations set forth in the
Stock Trading Agreement as amended by the Consent Agreement.
Each of the Restricted Parties and the Company has a right of
first offer if any other Restricted Party intends to sell its
shares in a private transaction. The Stock Trading Agreement
will terminate September 7, 2004. However, if a qualified
primary offering is completed within three years after the Stock
Trading Agreement becomes effective, the Stock Trading Agreement
will terminate 18 months after the completion of the qualified
primary offering.
Except as set forth above, to the knowledge of Leaf Mountain,
there are no contracts, arrangements, understandings or
relationships (legal or otherwise) between Leaf Mountain and any
other person with respect to any securities of the Company,
including, but not limited to, transfer or voting of any of the
securities, finder's fees, joint ventures, loan or option
arrangements, puts or calls, guarantees of profits, division of
profits or loss, or the giving or withholding of proxies.
Item 7.Material to Be Filed as Exhibits
EXHIBIT
NO. ;DESCRIPTION
1. Securities Purchase Agreement, dated as of November 29,
2001, by and between Electric City Corp. and Leaf Mountain
Company, LLC.
2. Investor Rights Agreement, dated as of July 31, 2001, by and
among Electric City Corp., Newcourt Capital Securities, Inc.,
Newcourt Capital USA, Inc., EP Power Finance, LLC, Morgan
Stanley Dean Witter Equity Funding, Inc., Originators Investment
Plan, LP, and Duke Capital Partners, LLC.
3. Stockholders Agreement, dated as of July 31, 2001, by and
among Electric City Corp., Newcourt Capital Securities, Inc.,
Newcourt Capital USA, Inc., EP Power Finance, LLC, Morgan
Stanley Dean Witter Equity Funding, Inc., Originators Investment
Plan, LP, and Duke Capital Partners, LLC.
4. Stock Trading Agreement, dated as of July 31, 2001, by and
among Electric City Corp., Newcourt Capital Securities, Inc.,
Newcourt Capital USA, Inc., EP Power Finance, LLC, Morgan
Stanley Dean Witter Equity Funding, Inc., Originators Investment
Plan, LP, Duke Capital Partners, LLC and each of the Members of
Management of Electric City Corp.
5. Consent and Amendment of Securities Purchase Agreement,
Stock Trading Agreement, Stockholders Agreement and Investor
Rights Agreement dated November 29, 2001 by and among Newcourt
Capital USA, Inc., EP Power Finance, LLC, Morgan Stanley Dean
Witter Equity Funding, Inc., Originators Investment Plan, LP,
Duke Capital Partners, LLC, Newcourt Capital Securities, Inc.,
various members of management of Electric City Corp. and Leaf
Mountain Company, LLC.
6. Joinder to Investor Rights Agreement, Stockholders Agreement
and Stock Trading Agreement dated November 29, 2001 by and
between Electric City Corp. and Leaf Mountain Company, LLC.
7. Form of Warrant Certificate to Purchase Shares of Common
Stock, Par Value $0.001 per share, of Electric City Corp.
8. Form of Warrant Certificate to Purchase Shares of Series A
Preferred Stock, par value $0.01 per share, of Electric City
Corp.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this
statement is true, complete and correct.
Date: December 10, 2001
LEAF MOUNTAIN COMPANY, L.L.C.
By:_/s/ John J. Jiganti
John J. Jiganti
Managing Director