SEC Info - Energy & Engine Technology Corp - SB-2

OMB APPROVAL

OMB Number: 3235-0418 Expires: February 28, 2006 Estimated average burden Estimated average burden hours per response. . . . .148.0

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM SB-2

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

Energy & Engine Technology Corporation

(Name of Small Business Issuer in its Charter)

Nevada		1311		88-0471842
(State or Jurisdiction of incorporation or organization)		(Primary Standard Industrial Classification Code Number)		(I.R.S. Employer Identification No.)

5308 West Plano Parkway

Plano, TX 75093

(972) 732-6360

(Address and telephone number of principal executive offices)

5308 West Plano Parkway

Plano, TX 75093

(Address of principal place of business or Intended Principal Place of Business)

Willard G. McAndrew, III

CEO and President

Energy & Engine Technology Corporation

5308 West Plano Parkway

Plano, TX 75093

(972) 732-6360

(Name, address, and telephone number of agent for service)

Copy of Communications to:

Jolie G. Kahn, Esq.

General Counsel

Energy & Engine Technology Corporation

5308 West Plano Parkway

Plano, TX 75093

(972) 732-6360

Approximate date of proposed sale to the public:

From time to time after the effective date of this Registration Statement.

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o ___________________________

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o ________________________________

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o _____________________________________

If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. o

CALCULATION OF REGISTRATION FEE - will be done on date prior to filing

Title of each class of securities to be registered (1)	Amount to be Registered	Proposed maximum offering price per unit (2)	Proposed maximum aggregate offering price (2)	Amount of registration fee (2)
Common Stock, par value $.001 per share	123,242,702	$0.071	$8,750,232	$1,030

(1)

In the event of a stock split, stock dividend, or similar transactions involving our common stock, the number of shares registered shall automatically be increased or decreased in the same proportion to cover the additional shares of common stock issuable pursuant to Rule 416 under the Securities Act of 1933, as amended.

(2)

The proposed maximum offering price per share and proposed maximum aggregate offering price is based upon the mean between the closing bid and asked price for the common stock as quoted by the NASDAQ Over the Counter Electronic Bulletin Board on June 2, 2005 and the registration fee has been calculated on such basis pursuant to Rule 457(c).

The Company hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Company shall file a further amendment which specifically states that this registration statement shall then become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on the date as the Commission, acting pursuant to said Section 8(a), may determine.

Subject to completion, dated June 3, 2005.

PRELIMINARY PROSPECTUS

ENERGY & ENGINE TECHNOLOGY CORPORATION

A NEVADA CORPORATION

123,242,702 shares of common stock

This prospectus relates to the resale by certain selling stockholders of up to 123,242,702shares of our common stock (which includes a reserve of 30,000,000 shares pursuant to a covenant to register 175% of shares likely to be issued upon conversion of certain convertible notes further described herein), issued to the selling stock-holders in a series of private placement transactions under Section 4(2) of the Securities Act of 1933 on April 27, 2005, May 10, 2005 and May 12, 2005 and to be sold on the fifth business day after the date of effectiveness of this Registration Statement. This Prospectus also relates to the resale by certain of those selling stockholders of stock underlying warrants issued to them (upon exercise of the warrants) with respect to certain of the private placement transactions.

The selling stockholders may offer to sell the shares of common stock being offered in this prospectus at fixed prices, at prevailing market prices at the time of sale, at varying prices or at negotiated prices. We will not receive any proceeds from the resale of shares of our common stock by the selling stockholder.

Our common stock is quoted on the NASDAQ Over the Counter Bulletin Board under the symbol “EENT.” On May 19, 2005, the closing bid quotation for one share of our common stock was $.08.

Our business is subject to many risks, and an investment in our common stock will also involve a high degree of risk. You should invest in our common stock only if you can afford to lose your entire investment. You should carefully consider the various Risk Factors described beginning on page 4 before investing in our common stock.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The information in this prospectus is not complete and may be changed. The selling stockholders may not sell or offer these securities until this registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

The date of this prospectus is June 3, 2005.

TABLE OF CONTENTS

	Page
PROSPECTUS SUMMARY	1
RISK FACTORS	2
WHERE YOU CAN FIND MORE INFORMATION	7
USE OF PROCEEDS	7
DETERMINATION OF OFFERING PRICE	7
SELLING STOCKHOLDERS	7
PLAN OF DISTRIBUTION	10
LEGAL PROCEEDINGS	12
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS	12
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT	14
DESCRIPTION OF SECURITIES	14
INTEREST OF NAMED EXPERTS AND COUNSEL	15
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES	16
DESCRIPTION OF BUSINESS	17
CURRENT BUSINESS	18
AXP 1000 AND RELATED RESEARCH AND DEVELOPMENT	18
DISCONTINUED OPERATIONS	25
MANAGEMENT'S DISCUSSION AND ANALYSIS	26
FORWARD LOOKING STATEMENT	28
RESULTS OF OPERATIONS	28
LIQUIDITY AND CAPITAL RESOURCES AND FISCAL CONDITION	30
DESCRIPTION OF PROPERTY	32
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS	32
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS	32
EXECUTIVE COMPENSATION	34
SUMMARY COMPENSATION TABLE	35
OPTION GRANTS IN LAST FISCAL YEAR	36
OPTION EXERCISES AND VALUES FOR FISCAL 2004	37
FINANCIAL STATEMENTS	38
INDEMNIFICATION OF DIRECTORS AND OFFICERS	74
OTHER EXPENSES OF ISSUANCE & DISTRIBUTION	75
RECENT SALES OF UNREGISTERED SECURITIES	75
EXHIBITS	77
UNDERTAKINGS	79
SIGNATURES	80

PROSPECTUS SUMMARY

Our Business

We are engaged in three operating businesses: (1) development and marketing of our AXP 1000 auxiliary power generator for long haul trucks; (2) development and marketing of marine and standalone generators; and (3) development and marketing of marine air conditioners. During the fiscal year ended December 31, 2004, we had net revenue of $207,165. For the three months ended March 31, 2005, we had net revenue of $162,145. Our principal executive offices are located at 5308 West Plano Parkway, Plano Texas 75093. Our telephone number is (972) 732-6360.

We have four wholly owned subsidiaries: Gas Gathering Enterprises, LLC (inactive),, Wind Dancer Aviation Services, Inc. (inactive), BMZ Generators Technology, Inc. and Anchor Manufacturing, Inc. In 2004, the businesses of Gas Gathering Enterprises, LLC and Wind Dancer Aviation Services, Inc. were deemed to be discontinued operations and the assets were sold in the first quarter of 2005. We were incorporated in Nevada on November 19, 1999, under the name Bidder Communications, Inc. and changed our name to Energy & Engine Technology Corporation on December 5, 2001. As used in this Prospectus, the terms “we”, “us”, “our” and the “Company”, mean Energy & Engine Technology Corporation and its subsidiaries, unless otherwise indicated.

Number of Shares Being Offered

This prospectus covers the resale by the selling stockholders named in this prospectus of up to 123,242,702 shares of our common stock that was issued to the selling stockholders in a series of private placement transactions under Section 4(2) of the Securities Act of 1933 on April 27, 2005, May 10 and 12, 2005, and on the fifth business day following the date of effectiveness of this Registration Statement. This Prospectus also relates to the resale by certain of such selling stockholders of stock underlying warrants issued to them (upon exercise of such warrants) in the private placement transactions. The selling stock-holders may sell the shares of common stock in the public market or through privately negotiated transactions or otherwise. The selling shareholder may sell these shares of common stock through ordinary brokerage transactions, directly to market makers or through any other means described in the section entitled “Plan of Distribution”.

Number of Shares Outstanding

There were 127,001,244 shares of our common stock issued and outstanding as at May 20, 2005.

Use of Proceeds

We will not receive any of the proceeds from the sale of the shares of common stock being offered for sale by the selling stockholders. We will, however, incur all costs associated with this registration statement and prospectus.

Summary of Financial Data

The summary financial data as of and for the years ended December 31, 2004 and December 31, 2003 presented below is derived from and should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2004, including the notes to those financial statements, which are included elsewhere in this prospectus along with the section entitled “Management's Discussion and Analysis of Liquidity and Results of Operations” beginning on page 26 of this prospectus. The summary financial data for the three months ended March 31, 2005 and March 31, 2004 presented below is derived from, and should be read in conjunction with, our unaudited condensed consolidated financial statements for the quarters ended March 31, 2005 and March 31, 2004, which are included elsewhere in this prospectus.

	For the Three Months Ended
	March 31, 2005 (unaudited)			March 31, 2004 (unaudited)

Net Sales	$	162,145		$	24,513
Net Loss for the Period	$	(705,745	)	$	(2,034,960	)
Loss Per Share - basic and diluted	$	(.01	)	$	(.02	)

	As of March 31, 2005
	(unaudited)

Working Capital (Deficiency)	$	(909,152	)
Total Assets	$	1,862,603
Total Share Capital	$	13,821,497
Accumulated Deficiency	$	(13,536,417	)
Total Stockholders' Equity	$	207,080

	For the Year Ended December 31, 2004			For the Year Ended December 31, 2003


Net Sales	$	207,165		$	4,341
Net Loss for the Period	$	(5,849,366	)	$	(5,041,657	)
Loss Per Share - basic and diluted	$	(0.05	)	$	(0.12	)

	As of December 31, 2004

Working Capital	$	247,533
Total Assets	$	2,277,839
Total Share Capital	$	13,766,998
Accumulated Deficit	$	(12,830,672	)
Total Stockholders' Equity	$	936,326

RISK FACTORS

An investment in our common stock involves a number of very significant risks. You should carefully consider the following risks and uncertainties in addition to other information in this prospectus in evaluating us and our business before purchasing shares of our common stock. Our business, operating results and financial condition could be seriously harmed due to any of the following risks. The risks described below are not the only ones facing us. Additional risks not presently known to us may also impair our business operations. You could lose all or part of your investment due to any of these risks.

Transaction Risks

SALES OF A SUBSTANTIAL NUMBER OF SHARES OF OUR COMMON STOCK INTO THE PUBLIC MARKET BY THE SELLING STOCKHOLDERS MAY RESULT IN A SIGNIFICANT DOWNWARD PRESSURE ON THE PRICE OF OUR COMMON STOCK AND COULD AFFECT THE ABILITY OF OUR STOCKHOLDERS TO REALIZE THE CURRENT TRADING PRICE OF OUR COMMON STOCK.

Sales of a substantial number of shares of our common stock in the public market could cause a reduction in the market price of our common stock. We had 127,001,244 shares of common stock issued and outstanding as of May 20, 2005. When this registration statement is declared effective, the selling stockholders may be reselling up to 123,242,702 shares of our common stock. As a result, a substantial number of our shares of common stock may be issued and may be available for immediate resale which could have an adverse effect on the price of our common stock as the increased supply may outstrip demand for our stock. To the extent selling stockholders sell large amounts of their shares of common stock registered under this registration statement, the price of our common stock may decrease due to the additional shares of common stock in the market.

Risks Related To Our Business

WE HAVE A HISTORY OF OPERATING LOSSES AND FLUCTUATING OPERATING RESULTS.

From inception through March 31, 2005, we have incurred aggregate losses of $(13,536,417). Our loss from operations for the fiscal year ended December 31, 2004 was $(5,849,366) and for the quarter ended March 31, 2005 was $(705,745). There is no assurance that we will operate profitably or will generate positive cash flow in the future. In addition, our operating results in the future may be subject to significant fluctuations due to many factors not within our control, such as the unpredictability of when customers will order products, the size of customers' orders, the demand for our products, and the level of competition and general economic conditions.

Even if our revenues increase, we expect an increase in development costs and operating costs. Consequently, we expect to incur operating losses and negative cash flow until our products gain market acceptance sufficient to generate a commercially viable and sustainable level of sales, and/or additional products are developed and commercially released and sales of such products made so that we are operating in a profitable manner. We cannot assure you of when or if our operations will become profitable or if we will be able to continue as a going concern.

WE MAY EXPERIENCE SIGNIFICANT AND RAPID GROWTH IF WE ARE ABLE TO CAPITALIZE ON THE EXPANSION OF THE AXP 1000. IF WE ARE UNABLE TO HIRE AND TRAIN STAFF TO HANDLE SALES AND MARKETING OF OUR PRODUCTS AND MANAGE OUR OPERATIONS, SUCH GROWTH COULD MATERIALLY AND ADVERSELY AFFECT US.

We intend to proceed with initiatives intended to capitalize on the expansion of the federal and state anti-idling legislation for long haul trucks and federal legislation mandating increased driver rest periods per hours driven. This could potentially lead to significant and rapid growth in the scope and complexity of our AXP 1000 and other generator business. Any inability on our part to manage such growth effectively will have a material adverse effect on our product development, business, financial condition and results of operations. Our ability to manage and sustain growth effectively will depend, in part, on the ability of our management to implement appropriate management, operational and financial systems and controls, and the ability of our management to successfully hire, train, motivate and manage employees. Effective growth management will also depend on our ability to solidify our supply chain and to secure and maintain quality control with respect to installation facilities for our products.

RAPID TECHNOLOGICAL CHANGES IN OUR INDUSTRY COULD RENDER OUR PRODUCTS NON-COMPETITIVE OR OBSOLETE AND CONSEQUENTLY AFFECT OUR ABILITY TO GENERATE REVENUES.

The markets in which we operate are characterized by rapid technological change, frequent new product and service introductions, evolving industry standards and changes in customer demands. The introduction of products embodying new technologies and the emergence of new industry standards can, in a relatively short period of time, render existing products obsolete and unmarketable, including ours. We believe that our success will depend upon our ability to continuously develop new products and to enhance our current products and introduce them promptly into the market. If we are not able to develop and introduce new products, our business, financial condition and results of operations could be adversely affected.

WE DO NOT CARRY COMPREHENSIVE PRODUCT LIABILITY INSURANCE PROVIDING COVERAGE IN ALL INSTANCES, AND THERE CAN BE NO ASSURANCE THAT OUR CURRENT INSURANCE COVERAGE WOULD BE ADEQUATE IN TERM AND SCOPE TO PROTECT US AGAINST MATERIAL FINANCIAL EFFECTS IN THE EVENT OF A SUCCESSFUL CLAIM.

We could be subject to claims in connection with the products that we sell. There can be no assurance that we would have sufficient resources to satisfy any liability resulting from any such claim, or that we would be able to have our customers indemnify or insure us against any such liability. There can be no assurance that our insurance coverage would be adequate in term and scope to protect us against material financial effects in the event of a successful claim. We currently do not carry commercial general liability insurance providing comprehensive product liability coverage in all instances. We may in the future obtain such insurance, provided it can be obtained at reasonable prices; however, there can be no assurance that such coverage, if obtained, would be adequate in term and scope to protect us.

WE ARE A START-UP COMPANY WITH LIMITED EXPERIENCE AND ARE SUBJECT TO ALL OF THE RISKS INHERENT IN A START-UP COMPANY, INCLUDING DEPENDENCE ON KEY PERSONNEL.

We are dependent upon obtaining future financing to fund operations for the next twelve months, which may not be available, due to our recent acquisition and resulting expanded business opportunities. We have not earned significant revenue since inception and have incurred losses since beginning operations. Further, our business activities may not result in any operational revenues or profits in the future. Therefore, you should be aware that your entire investment is at risk. Our business model is unproven and may not be adaptable to a changing market, which may reduce its ability to generate revenues, if any. We are dependent upon key personnel, and loss of these individuals could severely curtail the company's ability to implement its business plan. Due to our limited resources, we may not be able to attract and retain qualified personnel. If we do not experience sufficient revenue growth, we may need to obtain additional funding which, if not obtained, could hamper our operational abilities.

WE FACE INTENSE COMPETITION. IF WE DO NOT COMPETE EFFECTIVELY, OUR BUSINESS MAY SUFFER.

We face intense competition from numerous competitors. Each of our product lines face different competitors with different financial resources including competitors with greater amounts of financing than us. We may not be able to compete effectively with all of these competitors. Our products compete primarily on the basis of product quality, weight and size, installation ease, performance, innovation, price and applications and marketing expertise. To remain competitive, we must periodically enhance our existing products and respond to new technologies. In addition, new competitors may emerge, and product lines may be threatened by new technologies or market trends that reduce the value of these product lines.

OUR TECHNOLOGY IS IMPORTANT TO OUR SUCCESS AND OUR FAILURE TO PROTECT THIS TECHNOLOGY COULD PUT US AT A COMPETITIVE DISADVANTAGE.

Because a majority of our products rely on proprietary technology, we believe that the development and protection of the intellectual property rights for the proprietary technology is important to the future success of our business. In addition to relying on patent, trademark, and copyright rights, we rely on unpatented proprietary know-how and trade secrets, and employ various methods to protect our know-how and trade secrets, including the use of nondisclosure and similar contractual agreements. Despite our efforts to protect proprietary rights, unauthorized parties or competitors may copy or otherwise obtain and use these products or technology. The steps we have taken may not prevent unauthorized use of this technology and there can be no assurance that others will not independently develop the know-how and trade secrets or develop better technology than us or that current and former employees, contractors and other parties will not misappropriate proprietary information and copy or otherwise obtain and use our information and proprietary technology without authorization or otherwise infringe on our intellectual property rights.

WE ARE AND MAY IN THE FUTURE INVOLVED IN VARIOUS LEGAL PROCEEDINGS WHICH ARISE DURING THE COURSE OF OUR BUSINESS THAT COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR FINANCIAL POSITION AND RESULTS OF OPERATIONS.

We are involved in and will in the future become involved in various legal proceedings that periodically arise during the course of business. While we have reason to believe that the outcome of the one pending matter (see Note 8 under Legal Proceedings of the 2004 Audited Financials and Note 7 of the March 31, 2005 Financials(unaudited)) will not have a material adverse effect on our financial position, litigation is essentially unpredictable and excessive verdicts could occur. With regard to any future litigation, we cannot predict whether the outcome of such litigation will have a material adverse effect on our financial position. Although we believe we have valid defenses in the current matter, we cannot predict whether we will have valid defenses in future matters, and, in the future we could incur judgments or enter into settlements of claims that could have a material adverse effect on our financial position or results of operations.

WE MAY BECOME SUBJECT TO BURDENSOME REGULATIONS.

We may become subject to burdensome governmental regulations and legal uncertainties affecting the long haul trucking and general aviation industries, which could adversely affect our business and increase our cost and expenses. With regard to the long haul trucking industry, we are regulated by federal and state regulation which limit idling of long haul trucks. However, we believe that the federal government and the states may eventually enact “zero idling” legislation, and or other legislation to prevent any emissions from diesel engines on trucks during periods when the trucks are stopped. Since the AXP 1000 utilizes a diesel engine which still emits small amounts of noxious emissions, the device would be ineffective in a “zero idling” legislative environment. Other environmental laws could similarly limit the effectiveness of our current device. Thus, we need to comply with a strict regulatory scheme which is expensive and time consuming in order to develop and market new products.

As a result, legal uncertainties and new regulations could:

«	increase our costs of doing business, and

«	require us to revise our products or services,

any of which could increase our expenses, reduce our revenues and thereby materially adversely affect our business, financial condition and results of operations. Laws and regulations directly applicable to us have limited capital and may require additional future capital to continue operations; inability to obtain the necessary financing may force us to curtail or suspend our operations.

THE IMPLEMENTATION OF STOCK-BASED BENEFIT PLANS MAY DILUTE YOUR OWNERSHIP INTEREST.

We may enact one or more stock-based benefit plans for our employees as we expand in order to attract talented employees by offering “market” benefits. Such plans may cause the issuance of more stock, which will dilute the percentage of ownership interest of current stockholders.

OUR COMMON STOCK IS DEEMED TO BE “PENNY STOCK,” WHICH MAY MAKE IT MORE DIFFICULT FOR OUR STOCKHOLDERS TO SELL THEIR SHARES DUE TO SUITABILITY REQUIREMENTS.

Trading in our common stock is subject to the “penny stock” rules. The Securities Exchange Commission has adopted regulations that generally define a penny stock to be any equity security that has a market price of less than $5.00 per share. These rules require that any broker-dealer who recommends our securities to persons other than prior customers and accredited investors, must, before the sale, make a special written suitability determination for the purchaser and receive the purchaser's written agreement to execute the transaction. In addition, unless an exception is available, the broker-dealer must deliver a disclosure schedule explaining the penny stock market and the risks associated with trading in the penny stock market prior to any transaction. Further, broker-dealers must disclose commissions payable to both the broker-dealer and the registered representative and current quotations for the securities they offer. The additional burdens imposed upon broker-dealers by such requirements may discourage them from transactions in our common stock, which could severely limit the market price and liquidity of our common stock.

DEPENDENCE ON A LIMITED NUMBER OF QUALIFIED SUPPLIERS OF COMPONENTS AND MANUFACTURING EQUIPMEN T COULD LEAD TO DELAYS, LOST REVENUE OR INCREASED COSTS.

Because we depend on a limited number of suppliers for certain components and manufacturing equipment, an increase in the cost of such components or equipment, an extended shortage of required components or equipment, failure of a key supplier's business process, or the failure of key suppliers to remain in business, adjust to market conditions, or to meet our quality, yield or production requirements could significantly harm our operating results. A number of the components used by us are available from only a single or limited number of qualified outside suppliers, and may be used across multiple product lines. In addition, some of the components (or component types) used in our products are used in other devices. If there is a significant simultaneous upswing in demand for such a component (or component type) from several high volume industries, resulting in a supply reduction, or a component is otherwise in short supply, or if a supplier fails to qualify or has a quality issue with a component, we may experience delays or increased costs in obtaining that component. In addition, if a component becomes unavailable, we could suffer significant loss of revenue.

To reduce the risk of component shortages, we attempt to provide significant lead times when buying these components. As a result, we may be subject to cancellation charges if we cancel orders, which may occur when we make technology transitions.

In order to further reduce the risk of supply shortages, we have purchased BMZ Generators and Anchor Manufacturing in order to control the supply of generators and air conditioning components for the AXP 1000 units; however, those subsidiaries also depend on suppliers, and require significant cash to operate, so a downturn in either of those businesses could also have a material adverse impact on the Company.

In some cases, not only are we dependent on a limited number of suppliers, but we also have entered into or may enter into in the future contractual commitments that require us to buy a substantial number of components from certain suppliers. Our future operating results may depend substantially on our suppliers' ability to timely qualify their components in our programs, and their ability to supply us with these components in sufficient volume to meet our production requirements. A significant disruption in any of these suppliers' ability to manufacture and supply us with the components could harm our operating results.

FORWARD LOOKING STATEMENTS

This prospectus contains forward-looking statements which relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled “Risk Factors” on pages 3 to 7, that may cause our or our industries' actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results. The safe harbor for forward-looking statements provided in the Private Securities Litigation Reform Act of 1995 does not apply to the offering made in this prospectus.

WHERE YOU CAN FIND MORE INFORMATION

The Company files annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission. You may read and copy any of these reports, statements or other information at the Securities and Exchange Commission's public reference room located at 450 Fifth Street, N.W., Washington D.C. 20549. Please call the Securities and Exchange Commission at 1-800-SEC-0330 for further information on the public reference room. The Company's Securities and Exchange Commission filings are also available to the public from commercial document retrieval services and at the web site maintained by the Securities and Exchange Commission at www.sec.gov.

USE OF PROCEEDS

The shares of common stock offered hereby are being registered for the account of the selling stockholders named in this prospectus. As a result, all proceeds from the sales of the common stock will go to the selling stock-holders and we will not receive any proceeds from the sale of the common stock by the selling stockholders. We will, however, incur all costs associated with this registration statement and prospectus.

DETERMINATION OF OFFERING PRICE

The offering price will be determined from time to time by the selling stockholders. See “Plan of Distribution.”

SELLING STOCKHOLDERS

The selling stockholders may offer and sell, from time to time, any or all of their common stock being registered hereunder. Because the selling stockholders may offer all or only some portion of the 123,242,702 shares of common stock to be registered, no estimate can be given as to the amount or percentage of these shares of common stock that will be held by the selling stockholders upon termination of the offering.

None of the selling shareholders had any position, office or material relationship with us or any of our affiliates in the last three years. The selling stockholders are not broker-dealers (acting in such capacity) or affiliates of a broker-dealer to our knowledge.

The following table sets forth certain information regarding the beneficial ownership of shares of common stock by the selling stockholders as of May 20, 2005 and the number of shares of common stock covered by this prospectus. The number of shares in the table represents an estimate of the number of shares of common stock to be offered by the selling stockholder.

			Number of Shares Owned By Selling Stockholder After Offering and Percent of Total (1)

Selling Stockholder	Common Stock Owned by Selling Stockholder (2)	Total Shares Registered for Selling Stockholder	# of Shares	% of Class
Longview Fund, LP, Michael Rudolph, Controlling Person	26,520,737	26,520,737	0	0

Longview Equity Fund, LP, Michael Rudolph, Controlling Person	27,846,774	27,846,774	0	0

Longview International Equity Fund, LP, Michael Rudolph, Controlling Person	11,934,332	11,934,332	0	0

Ashford Capital Transition Fund I, LP, Frank Cavanaugh, Controlling Person	4,420,123	4,420,123	0	0

Lagunitas Partners LP, Jon D. Gruber, Controlling Person	11,713,226	11,713,226	0	0

Gruber & McBain International, Jon D. Gruber, Controlling Person	2,431,068	2,431,026	0	0

Jon D. Gruber and Linda W. Gruber	3,536,098	3,536,098	0	0

Rob Tholomeier	1,210,061	1,210,061	0	0

David Dorhmann	1,210,061	1,210,061	0	0

David Olson	1,210,062	1,210,062	0	0

Brian Swift	1,210,062	1,210,062	0	0

1.	Assumes all of the shares of common stock offered are issued and are sold. Percentage of class is based on 220,403,702 common shares issued and outstanding on May 20, 2005 as if the full amount of convertible notes described herein are converted at $.05 per share, with all warrants being exercised.

2.	The number of shares of common stock listed as beneficially owned by the selling stockholder represents the number of common stock owned by such stockholder and any shares that may be acquired pursuant to any warrants owned by such stockholder.

We may require the selling stockholders to suspend the sales of the securities offered by this prospectus upon the occurrence of any event that makes any statement in this prospectus or the related registration statement untrue in any material respect or that requires the changing of statements in these documents in order to make statements in those documents not misleading.

The Selling Shareholders have invested $1,334,667, in the aggregate in the Company. Funding occurred on April 27, 2005, May 10, 2005 and May 12, 2005. An additional $665,333 is due to be invested within 5 business days of the date of effectiveness of this Registration Statement. The amounts invested and to be invested (assuming additional $665,333 is invested) and warrants issued and to be issued to each are as follows:

Selling Shareholder	Amount Invested	Warrants	Semi Annual Coupon (assuming 8% rate)
Longview	$600,000	14,520,737	$24,000
Longview Equity	$630,000	15,246,774	$25,200
Longview International Equity	$270,000	6,534,332	$10,800
Ashford Capital	$100,000	2,420,123	$4,000
Lagunitas Partners	$265,000	6,413,326	$10,600
Gruber & McBain International	$55,000	1,331,068	$2,200
Jon D. Gruber and Linda W. Gruber	$80,000	1,936,098	$3,200
Rob Tholomeier	0	1,210,061	0
David Dohrmann	0	1,210,061	0
David Olson	0	1,210,062	0
Brian Swift	0	1,210,062	0

The funds were invested pursuant to Secured Convertible Notes, dated as of April 27, 2005, May 10, 2005, May 12, 2005 and the fifth day following the date of effectiveness of this Registration Statement (the “Notes”).

The terms of the Notes are as follows:

The coupon payment is due on October 1, 2005, and semi annually thereafter while the Notes are outstanding, and the Notes are due on the two year anniversary of the issuance date.

The Notes are convertible into EENT Common Stock at any time at the holder's discretion in part or in whole by dividing the principal amount converted by a price (“Conversion Price”) equal to the lesser of (i) $0.12, or (ii) 70% of the average of the five lowest closing bid prices of the Common Stock as reported by Bloomberg L.P. for the Over the Counter Bulletin Board for the twenty trading days preceding a conversion date. Until the later of 270 days after the issue date of this Note, or until the closing bid price of the Common Stock as reported by Bloomberg L.P. for the Principal Market is less than $.06, the minimum Conversion Price shall be $0.05. At all times beneficial ownership of EENT Common Stock for any investor and its affiliates shall not exceed 4.99% on an as converted basis (unless such investor opts to waive such condition). Conversion Price is adjusted equitably for stock splits and the like.

Selling Shareholders were issued an aggregate of 42,242,704 five year Class A Warrants at an exercise price of $0.12 per share. The Class A Warrants are callable by the Company at $0.12 per share if for any 10 day trading period the common stock closes at least $0.24 per share for each of the trading days.

The Selling Shareholders were issued an aggregate of 11,000,000 five year Class B Warrants at an exercise price of $0.20 per share. One half of the Class B Warrants are callable by the Company following the two consecutive calendar months during which the Company has sold and delivered 100 AXP 1000 units, and all of the Class B Warrants may be called during the calendar month following the two consecutive months during which the Company has sold and delivered 150 AXP 1000 units.

Within 30 business days of April 27, 2005, EENT is required to file a registration statement on Form SB-2 for the shares into which the Convertible Notes are convertible and underlying the Warrants. The Company shall use its best efforts to have the registration statement declared effective within 120 days after April 27, 2005.

Events of Default under the Convertible Notes include: bankruptcy; failure to timely file the Registration Statement; failure to maintain trading of the Common Stock on the over the counter bulletin board; and failure to make any payment within 30 days of the due date therefor. Remedies include foreclosure on the assets of the Company and its subsidiaries, on which purchasers of the Notes have a first lien, and payment of a 2% per month penalty for late filing of the registration statement, or if it is not effective within 120 days after April 27, 2005.

Selling Shareholders also covenant not to use any of the Shares registered hereunder to cover any short position in the Company’s Common Stock.

PLAN OF DISTRIBUTION

This prospectus relates to the offer and sale from time to time by the selling stockholders of up to 123,242,702 shares of common stock. We have registered such shares of common stock for sale to provide the holders thereof with freely tradeable securities, but registration of such shares does not necessarily mean we will issue any of such shares or that the selling stockholders will offer or sell such shares. Any of the selling stockholders may, from time to time, sell all or a portion of the shares of common stock on any market upon which the common stock may be quoted (currently the NASDAQ Over the Counter Bulletin Board), in privately negotiated transactions or otherwise. Sales may be at fixed prices prevailing at the time of sale, at prices related to the market prices or at negotiated prices. The offering price of the shares from time to time will be determined by the selling stockholders and, at the time of such determination, may be higher or lower than the market price of the shares on the NASDAQ Over the Counter Bulletin Board.

The shares of common stock being offered by this prospectus may be sold by the selling stockholders or by their donees, transferees, successors or assigns by one or more of the following methods, without limitation:

«	on the NASDAQ Over the Counter Bulletin Board or any other exchange or over the counter market on which the stock is listed at the time of sale;

«	block trades in which the broker or dealer so engaged will attempt to sell the shares of common stock as agent but may position and resell a portion of the block as principal to facilitate the transaction;

«	purchases by broker or dealer as principal and resale by the broker or dealer for its own account pursuant to this prospectus;

«	ordinary brokerage transactions and transactions in which the broker solicits purchasers;

«	privately negotiated transactions;

«	market sales (both long and short to the extent permitted under the federal securities laws);

«	at the market to or through market makers or into an existing market for the shares;

«	through transactions in options, swaps or other derivatives (whether exchange listed or otherwise);

«	in underwritten offerings; and

«	a combination of any aforementioned methods of sale.

The selling stockholders may accept and, together with any agents of the selling stockholders, reject in whole or in part any proposed purchase of shares of common stock offered by this prospectus. The Company will not receive any proceeds from the offering of shares by the selling stockholders.

In the event of the transfer by any of the selling stockholders of their shares to any pledgee, donee or other transferee, we will amend this prospectus and the registration statement of which this prospectus forms a part by the filing of a post-effective amendment in order to have the pledgee, donee or other transferee in place of the selling stockholders who have transferred his or her shares.

In effecting sales, brokers and dealers engaged by the selling stock-holder may arrange for other brokers or dealers to participate. Brokers or dealers may receive commissions or discounts from the selling stockholder or, if any of the broker-dealers act as an agent for the purchaser of such shares, from the purchaser in amounts to be negotiated which are not expected to exceed those customary in the types of transactions involved. Broker-dealers may agree with the selling stockholder to sell a specified number of the shares of common stock at a stipulated price per share. Such an agreement may also require the broker-dealer to purchase as principal any unsold shares of common stock at the price required to fulfill the broker-dealer commitment to the selling stockholder if such broker-dealer is unable to sell the shares on behalf of the selling stockholder. Broker-dealers who acquire shares of common stock as principal may thereafter resell the shares of common stock from time to time in transactions which may involve block transactions and sales to and through other broker-dealers, including transactions of the nature described above. Such sales by a broker dealer could be at prices and on terms then prevailing at the time of sale, at prices related to the then-current market price or in negotiated transactions. In connection with such resales, the broker-dealer may pay to or receive from the purchasers of the shares commissions as described above.

The selling stockholders and any broker-dealers or agents that participate with the selling stockholders in the sale of the shares of common stock may be deemed to be “underwriters” within the meaning of the Securities Act in connection with these sales. In that event, any commissions received by the broker-dealers or agents and any profit on the resale of the shares of common stock purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act.

From time to time, the selling stockholders may pledge their shares of common stock pursuant to the margin provisions of its customer agreements with its brokers. Upon a default by a selling stockholder, the broker may offer and sell the pledged shares of common stock from time to time. Upon a sale of the shares of common stock, the selling stockholder intends to comply with the prospectus delivery requirements under the Securities Act by delivering a prospectus to each purchaser in the transaction. We intend to file any amendments or other necessary documents in compliance with the Securities Act which may be required in the event the selling stockholder defaults under any customer agreement with brokers.

To the extent required under the Securities Act, a prospectus supplement accompanying this prospectus, or, if appropriate, a post effective amendment to this registration statement will be filed, disclosing the name of any underwriters or broker-dealers, the number of shares of common stock involved, the price at which the common stock is to be sold, the commissions paid or discounts or concessions allowed to such underwriters or broker-dealers, where applicable, that such broker-dealers did not conduct any investigation to verify the information set out or incorporated by reference in this prospectus and other facts material to the transaction.

We and the selling stockholders will be subject to applicable provisions of the Exchange Act and the rules and regulations under it, including, without limitation, Rule 10b-5 and, insofar as the selling stockholders are distribution participants and we, under certain circumstances, may be a distribution participant, under Regulation M. All of the foregoing may affect the marketability of the common stock.

All expenses of the registration statement including, but not limited to, legal, accounting, printing and mailing fees are and will be borne by us. Any commissions, discounts or other fees payable to underwriters or broker- dealers in connection with any sale of the shares of common stock will be borne by the selling stockholder, the purchasers participating in such transaction, or both.

Any shares of common stock covered by this prospectus which qualify for sale pursuant to Rule 144 under the Securities Act, as amended, may be sold under Rule 144 rather than pursuant to this prospectus.

We have not registered or qualified the shares of common stock offered by this prospectus under the laws of any country, other than the United States. In certain states, the selling stockholders may not offer or sell their shares of common stock unless (1) we have registered or qualified such shares for sale in such states or (2) we have complied with an available exemption from registration or qualification. Also, in certain states, to comply with such state securities laws, the selling stockholders can offer and sell their shares of common stock only through registered or licensed brokers or dealers.

LEGAL PROCEEDINGS

On October 28, 2003, the Company was served with a complaint by 600 Racing, Inc. The complaint alleges that EENT is liable on a $150,000 judgment issued against Millennium Fuels USA, LLC (“MFUSA”), an unrelated entity, of which Will McAndrew and Roger Wurtele, the Company's CEO and CFO, respectively, were the Managers. The complaint alleges that the Company engaged in a joint enterprise with MFUSA and integrated resources with MFUSA and is thus liable on an “alter ego” theory.

Energy & Engine Technology Corp · SB-2 · On 6/3/05

Filed On 6/3/05 5:46pm ET · SEC File 333-125522 · Accession Number 1121811-5-54

Registration of Securities by a Small-Business Issuer · Form SB-2
Filing Table of Contents

SB-2 · Energy and Engine Technology Corporation

This is an EDGAR HTML document rendered as filed. [ Alternative Formats ]

Energy & Engine Technology Corp · SB-2 · On 6/3/05

Filed On 6/3/05 5:46pm ET · SEC File 333-125522 · Accession Number 1121811-5-54

Registration of Securities by a Small-Business Issuer · Form SB-2Filing Table of Contents

SB-2 · Energy and Engine Technology Corporation

This is an EDGAR HTML document rendered as filed. [ Alternative Formats ]

Registration of Securities by a Small-Business Issuer · Form SB-2
Filing Table of Contents