<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______ to _______.
Commission File Number 0-28060
BOLDER TECHNOLOGIES CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 84-1166231
- --------------------------------------------------------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
4403 Table Mountain Drive, Golden, CO 80403
(Address of principal executive offices including zip code)
(303) 215-7200
(Registrant's telephone number, including area code)
BOLDER Technologies Corporation,
5181 Ward Road, Wheat Ridge, Colorado 80033
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
--- ---
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Common Stock $.001 par value 9,464,207
---------------------------- ----------------------------
(Class) (Outstanding at May 1, 1997)
<PAGE> 2
BOLDER TECHNOLOGIES CORPORATION
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE NUMBER
-----------
<S> <C>
COVER PAGE 1
TABLE OF CONTENTS 2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Condensed Balance Sheets as of March 31, 1997 and
December 31, 1996 3
Condensed Statements of Operations for the three-month
periods ended March 31, 1997 and 1996, and the period
from March 22, 1991 (inception) through March 31, 1997 4
Condensed Statements of Cash Flows for the three-month
periods ended March 31, 1997 and 1996, and the period
from March 22, 1991 (inception) through March 31, 1997 5
Notes to Condensed Financial Statements 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS 7
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS 10
ITEM 2. CHANGES IN SECURITIES 10
ITEM 3. DEFAULTS UPON SENIOR SECURITIES 10
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 10
ITEM 5. OTHER INFORMATION 10
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 10
SIGNATURES 11
</TABLE>
2
<PAGE> 3
BOLDER TECHNOLOGIES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1997 1996
------------ ------------
ASSETS (UNAUDITED)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 2,372,302 $ 968,297
Short-term investments 12,002,959 15,102,380
Other current assets 553,231 193,717
------------ ------------
TOTAL CURRENT ASSETS 14,928,492 16,264,394
Property and equipment, at cost, net 13,669,925 10,679,539
Other assets, net 223,263 202,183
------------ ------------
TOTAL ASSETS $ 28,821,680 $ 27,146,116
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable and accrued liabilities $ 1,000,438 $ 799,041
Construction-in-process payable -- 2,043,294
Deferred revenue 3,544,209 746,343
Notes and capital leases, current portion 637,459 272,360
------------ ------------
TOTAL CURRENT LIABILITIES 5,182,106 3,861,038
Notes and capital leases, less current portion 2,135,846 214,177
Commitments and contingencies
Stockholder's equity:
Common Stock, $.001 par value, 9,691,622 shares
authorized; 9,463,005 and 9,447,622 shares
issued at March 31, 1997 and December 31, 1996,
respectively 9,463 9,448
Treasury stock, $.001 par common stock, 33,333
shares at March 31, 1997 and December 31, 1996 (50,000) (50,000)
Additional paid-in capital 36,855,706 36,761,827
Deficit accumulated during the development stage (15,311,441) (13,650,374)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY 21,503,728 23,070,901
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 28,821,680 $ 27,146,116
============ ============
</TABLE>
See accompanying notes
3
<PAGE> 4
BOLDER TECHNOLOGIES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED FOR THE PERIOD
MARCH 31, FROM INCEPTION
---------------------------- (MARCH 22,1991)
1997 1996 TO MARCH 31, 1997
------------ ------------ -----------------
<S> <C> <C> <C>
REVENUES
Product sales $ 37,758 $ 11,948 $ 129,589
Research and development services 441,989 -- 974,447
------------ ------------ ------------
479,747 11,948 1,104,036
COST OF REVENUES 140,418 9,333 382,505
------------ ------------ ------------
339,329 2,615 721,531
OPERATING EXPENSES
Research and development 1,018,234 583,092 10,722,595
General and administrative 1,092,624 243,437 5,754,113
Selling and marketing 79,652 58,974 573,911
------------ ------------ ------------
INCOME (LOSS) FROM OPERATIONS (1,851,181) (882,888) (16,329,088)
OTHER INCOME (EXPENSE)
Interest income 206,273 32,703 1,220,386
Interest expense (16,159) (13,616) (202,739)
------------ ------------ ------------
NET INCOME (LOSS) $ (1,661,067) $ (863,801) $(15,311,441)
============ ============ ============
Income (loss) per common and
common equivalent share $ (0.18)
============
Shares used in computing
net income (loss) per common
and equivalent share 9,457,877
============
</TABLE>
See accompanying notes.
4
<PAGE> 5
BOLDER TECHNOLOGIES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED FOR THE PERIOD
MARCH 31, FROM INCEPTION
---------------------------- (MARCH 22,1991)
1997 1996 TO MARCH 31, 1997
------------ ------------ -----------------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net Loss $ (1,661,067) $ (863,801) $(15,311,441)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Depreciation and amortization 77,008 94,753 1,042,047
Change in deferred revenue 2,797,866 -- 2,797,866
Other -- -- 104,956
Changes in operating assets and liabilities (158,116) 11,773 1,159,305
------------ ------------ ------------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 1,055,691 (757,275) (10,207,267)
------------ ------------ ------------
INVESTING ACTIVITIES
Purchase of short term investments (2,480,982) (2,326,287) (48,333,724)
Sale of short term investments 5,580,403 2,569,587 36,330,765
Purchases of property and equipment (3,064,519) (27,545) (14,674,062)
Increase (decrease) in construction-in-process payable (2,043,293) -- --
Repayment of notes receivable from founder -- -- 152,066
Issuance of notes receivable from founder -- (2,290) (152,066)
Patent costs (23,957) (5,571) (191,259)
------------ ------------ ------------
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES (2,032,348) 207,894 (26,868,280)
------------ ------------ ------------
FINANCING ACTIVITIES
Proceeds from issuance of preferred stock -- 100,000 9,947,662
Proceeds from issuance of common stock 93,894 9,973 25,537,402
Proceeds from issuance of notes payable and capital leases 2,359,846 -- 6,720,493
Purchase of treasury stock from founder -- -- (50,000)
Payments on notes payable and capital leases payable (73,078) (63,652) (467,261)
Stock issuance costs -- -- (2,243,410)
Issuance of warrants to purchase common or preferred stock -- -- 2,963
------------ ------------ ------------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 2,380,662 46,321 39,447,849
============ ============ ============
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 1,404,005 (503,060) 2,372,302
Cash and cash equivalents, beginning of period 968,297 664,219 --
------------ ------------ ------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 2,372,302 $ 161,159 $ 2,372,302
============ ============ ============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest $ 12,320 $ 9,358 $ 46,918
============ ============ ============
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING
AND FINANCING ACTIVITIES
Conversion of notes payable and related accrued
interest to preferred stock $ -- $ -- $ 3,585,820
============ ============ ============
Property purchased under capital leases $ -- $ -- $ 17,805
============ ============ ============
</TABLE>
NOTE: UPON THE CLOSING OF THE COMPANY'S INITIAL PUBLIC OFFERING IN MAY, 1996,
THE PREFERRED STOCK CONVERTED TO COMMON STOCK.
See accompanying notes.
5
<PAGE> 6
BOLDER TECHNOLOGIES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 1997 (UNAUDITED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The interim financial information of BOLDER Technologies Corporation (the
"Company" or "BOLDER") for the three-month periods ended March 31, 1997
and 1996 is unaudited, but includes all adjustments (consisting only of
normal recurring entries) which the Company's management believes to be
necessary for the fair presentation of financial position, results of
operations and cash flows for the periods presented. The accompanying
interim financial statements should be read in conjunction with the
financial statements and notes thereto for the year ended December 31,
1996 included in the Company's Annual Report on Form 10-KSB. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to the Securities and
Exchange Commission rules and regulations. Interim results of operations
for the three-month period ended March 31, 1997 are not necessarily
indicative of operating results to be expected for the full year.
Net loss per share for periods prior to the Company's initial public
offering is not considered relevant as it would differ materially from net
loss per common share and common equivalent share given the changes in the
capital structure of the Company (primarily the conversion of preferred
stock to common stock) which occurred on the closing of the IPO in May
1996.
The Company has received certain payments in connection with its new
strategic partnership with Johnson Controls announced in February 1997.
These payments, which have been recorded as deferred revenue, are
consideration to the Company for certain services to be provided to JCI to
transfer appropriate technical information to JCI as specified in the new
agreement. The Company is recognizing revenue as services are performed.
To enhance comparability between periods, the amount reported in the first
quarter 1996 as loss from joint venture have been reclassified to research
and development expense. This reclassification results from the
termination in 1996 of the joint venture with Johnson Controls in
connection with the new partnership, and the assumption of costs by the
Company which were previously incurred by the joint venture.
In March 1997, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards No. 128, "Earnings Per Share"
(SFAS No. 128), which supersedes Accounting Principles Board Opinion No.
15, "Earnings Per Share" ("APB No. 15"). SFAS No. 128 simplifies the
requirements for reporting earnings per share ("EPS") by requiring
companies only to report "basic" and "diluted" EPS. SFAS No. 128 is
effective for both interim and annual periods ending after December 15,
1997 but requires retroactive restatement upon adoption. The Company will
adopt SFAS No. 128 in the fourth quarter of 1997. The Company does not
believe such adoption will have a material effect on either its previously
reported or future results of operations.
6
<PAGE> 7
BOLDER TECHNOLOGIES CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Except for the historical information contained herein, the following
discussion contains forward-looking statements that involve risks and
uncertainties. The Company's actual results could differ materially from those
discussed herein. Factors that could cause or contribute to such differences
include, but are not limited to, those discussed in the sections entitled
"Business" and "Management's Discussion and Analysis of Financial Condition and
Results of Operations," in the Company's 1996 Annual Report on Form 10-KSB
filed in March 1997, as well as the Company's February 13, 1997 Prospectus, and
the Company's reports on Form 8-K filed January 3, February 5, and March 17,
1997.
GENERAL
Since its inception in March 1991, BOLDER Technologies Corporation (the
"Company") has been a development stage company, principally engaged in the
research and development of its Thin Metal Film ("TMF") battery technology, and
has devoted significant resources to the development of its technology and
processes to manufacture its TMF batteries. To date, the Company has produced
more than 45,000 prototype TMF batteries. An aggregate of approximately 4,500
cells have been shipped to a total of 75 customers, primarily for evaluation.
The Company is currently building commercial production facities for the
manufacture of its TMF batteries, but has not yet manufactured cells in
commercially viable quantities. The Company expects to generate revenues
primarily from the sale of its TMF batteries.
In June 1995, the Company and Johnson Controls Battery Group, Inc. ("Johnson
Controls") established a joint venture (the "Joint Venture") to develop high
volume manufacturing technology for TMF batteries, to manufacture TMF batteries
for both partners and to pursue HEV battery development opportunities for TMF
batteries. In January 1997, having substantially completed its primary
objective of developing the high volume manufacturing technology, the Company
and Johnson Controls announced a new strategic partnership which replaced the
Joint Venture effective as of July 1996. Under the terms of the new agreement,
each party will separately implement TMF battery manufacturing facilities to
best meet the unique requirements of the markets addressed by each.
In connection with the new agreement, BOLDER received a cash payment from
Johnson Controls. BOLDER also received ownership of all of the tangible net
assets of the Joint Venture. In return, BOLDER agreed to exchange certain
technical information with Johnson Controls and granted Johnson Controls
royalty-bearing licenses to allow Johnson Controls to sell TMF batteries in
specified markets. (See "Business--Strategic Relationships" in the Form 10-KSB
filed in March 1997.)
As noted in the 1996 Annual Report on Form 10-KSB, the Company has received
notice from Johnson Controls disputing the scope of Johnson Control's license
for the car and truck primary starting market. (See part II, Item 1, "Legal
Proceedings" elsewhere herein.)
The Company believes that its results of operations to date may not be
indicative of results in future periods. Future operating results may be
affected by a wide range of factors and may fluctuate significantly from period
to period.
7
<PAGE> 8
RESULTS OF OPERATIONS
Total revenues for the three-month period ended March 31, 1997, increased to
$479,747 from $11,948 in the same period in 1996. The majority of the research
and development services revenues of $441,989 resulted from the Company's
recognition of revenue from services performed in connection with the
technology transfer arrangement with Johnson Controls. A government funded
development program provided a small portion of research and development
services revenue in the first quarter of 1997. There were no research and
development services revenue in the first quarter of 1996. Product revenues of
$37,758 in the three-month period ended March 31, 1997 increased from the same
period last year but are expected to remain at nominal levels until the
beginning of high volume production later in 1997.
Cost of revenues increased to $140,418 from $9,333 for the three-month periods
ended March 31, 1997 and 1996, respectively. Most of the increase in 1997 was
associated with costs directly attributable to government or customer-funded
development programs.
Research and development expenses increased to $1,018,234 from $583,092 for the
three-month periods ended March 31, 1997 and 1996, respectively. The increase
was primarily due to additional technical staff and related expenses as a
result of the Company's expanded efforts to commercialize its sub-C cell and
prepare for high volume manufacturing.
General and administrative expenses increased to $1,092,624 from $243,437 for
the three-month periods ended March 31, 1997 and 1996, respectively. The
increases in 1997 were due to recruiting and relocation expenses for additional
technical staffing to support research and development activities, additional
administrative staffing and added expenses for insurance, legal, and investor
relations associated with becoming a public company. Also, included in 1997
expenses was approximately $210,000 of costs (printing, legal, and accounting)
associated with the registration statement filed in February 1997 and withdrawn
in May 1997.
Selling and marketing expenses increased to $79,652 from $58,974 for the
three-month periods ended March 31, 1997 and 1996, respectively. These 1997
increases were primarily due to increased marketing and business development
activities related to the Company's efforts to obtain purchase orders for
delivery of product upon completion later in 1997 of the Company's first
high-volume production line.
Interest income increased to $206,273 from $32,703 for the three-month periods
ended March 31, 1997 and 1996, respectively. The increase in 1997 resulted
primarily from investment of proceeds from the Company's IPO in May 1996.
Interest expense increased to $16,159 for the three months ended March 31, 1997
from $13,616 in the prior year, mainly due to increased levels of lease
financing.
8
<PAGE> 9
LIQUIDITY AND CAPITAL RESOURCES
From its inception through March 31, 1997, the Company has financed its
operations and met its capital requirements primarily through private and
public offerings of its equity securities, raising net proceeds of $36.7
million from sales of these securities. At March 31, 1997, the Company's
balances of cash, cash equivalents, and available-for-sale securities totaled
$14.4 million, compared to $16.1 million at December 31, 1996.
On May 8, 1997, the Company announced it had signed a commitment letter for an
equipment financing credit line from Transamerica Business Credit Corporation
("TBCC") of up to $8 million to finance BOLDER's first state-of-the-art, high
volume manufacturing line. In addition, TBCC was granted a "Right of First
Refusal" with respect to the next $15 million of equipment financing by BOLDER.
Concurrently, on May 8, 1997, BOLDER announced it had withdrawn the
Registration Statement on Form SB-2 which was filed on February 13, 1997.
As of March 31, 1997, the Company had made progress payments of $8.8 million to
fund the construction of its first high-volume production line. In addition to
amounts paid, the Company expects to incur additional costs related to this
line of approximately $1.0 million. As a result of its recent agreement with
Johnson Controls, the Company owns 100 percent of the first commercial
high-volume production line and will pay 100 percent of the costs associated
with the fabrication and installation of the line. The Company invested $3.1
million during the first quarter 1997 in leasehold improvements, machinery,
equipment, and office furnishings to support its new facility and its
development, production, sales, and administrative activities. The Company has
financed $2.4 million of these first quarter 1997 capital additions through
notes payable.
In addition to amounts paid through March 31, 1997, the Company expects to
incur additional costs related to the completion of leasehold improvements in
its new facility of approximately $2.0 million, for which the Company has
received financing commitments of up to $1.5 million. The Company has entered
into an 11-year lease agreement for this facility.
Except as noted above, the Company currently has no other significant capital
commitments other than its commitments under notes payable. The Company
believes that its existing sources of liquidity and projected cash generated
from future operations will satisfy the Company's capital requirements for
approximately the next 12 months. To provide funds for future production lines,
the Company will need to access additional sources of equity capital or debt.
If these financing sources are not available, then the Company would likely
delay the ramp-up of its second and subsequent fully-automated production
lines. There can be no assurance that the Company will generate revenues and
operating income sufficient to satisfy its working capital and equipment
expenditure needs in the future. In addition, the Company is unable to predict
the precise amount of future capital that it may require, and there can be no
assurance that any additional financing will be available to the Company if
that need arises or that financing will be in a form or on terms acceptable to
the Company. The inability to generate revenues and operating income or obtain
required financing on acceptable terms would have a material adverse effect on
the Company's business, financial condition, and results of operations.
Consequently, the Company could be required to significantly reduce or suspend
its operations, seek a merger partner or sell additional securities on terms
that could be dilutive to the Company's stockholders.
9
<PAGE> 10
BOLDER TECHNOLOGIES CORPORATION
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
As noted in the 1996 Annual Report on Form 10-KSB, the Company has
received notice from Johnson Controls disputing the scope of Johnson
Control's license for the car and truck primary starting market. In
April 1997, the Company initiated an arbitration proceeding to
resolve the dispute.
The Company has been named in a personal injury action filed in
Superior Court in the County of Los Angeles on March 28, 1996 arising
out of a motor vehicle accident. Management believes that the
resolution of this claim will not have a material adverse effect on
the Company's business, results of operations, and financial
condition. The Company is not a party to any other legal proceedings.
ITEM 2. CHANGES IN SECURITIES.
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None
ITEM 5. OTHER INFORMATION.
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBIT DESCRIPTIONS OF DOCUMENTS
------- -------------------------
27 -- Financial Data Schedule.
(b) During the first quarter ended March 31, 1997, the Company filed
three reports on Form 8-K, dated January 3, February 5, and
March 17, 1997, pursuant to Item 5 of such form.
10
<PAGE> 11
BOLDER TECHNOLOGIES CORPORATION
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has caused this report to be signed in its behalf by the undersigned
thereunto duly authorized.
BOLDER Technologies Corporation
Date: May 14, 1997 By: /s/ Daniel S. Lankford
------------------ -----------------------------------
Daniel S. Lankford
Chairman and Chief Executive Officer
By: /s/ Joseph F. Fojtasek
-----------------------------------
Joseph F. Fojtasek
Vice President and Chief Financial
Officer (Principal Financial and
Accounting Officer)
11
<PAGE> 12
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<S> <C>
27 - Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,372,302
<SECURITIES> 12,002,959
<RECEIVABLES> 435,743
<ALLOWANCES> 0
<INVENTORY> 44,708
<CURRENT-ASSETS> 14,928,492
<PP&E> 14,691,867
<DEPRECIATION> 1,021,942
<TOTAL-ASSETS> 28,821,680
<CURRENT-LIABILITIES> 5,182,105
<BONDS> 2,135,846
0
0
<COMMON> 9,463
<OTHER-SE> 21,494,265
<TOTAL-LIABILITY-AND-EQUITY> 21,503,728
<SALES> 37,758
<TOTAL-REVENUES> 479,747
<CGS> 140,418
<TOTAL-COSTS> 140,818
<OTHER-EXPENSES> 1,018,324
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 16,158
<INCOME-PRETAX> 1,661,067
<INCOME-TAX> 0
<INCOME-CONTINUING> 1,661,067
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,661,067
<EPS-PRIMARY> (0.18)
<EPS-DILUTED> (0.18)
</TABLE>
