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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
(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, 2000
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)
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<S> <C>
Delaware 84-1166231
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(State or other jurisdiction of incorporation or organization) (IRS Employer Identification No.)
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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)
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(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 14,566,835
---------------------------- ----------------------------
(Class) (Outstanding at May 1, 2000)
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BOLDER TECHNOLOGIES CORPORATION
TABLE OF CONTENTS
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PAGE NUMBER
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COVER PAGE 1
TABLE OF CONTENTS 2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)
Condensed Balance Sheets as of March 31, 2000 and December 31, 1999 3
Condensed Statements of Operations for the three-month periods ended
March 31, 2000 and 1999 4
Condensed Statements of Cash Flows for the three-month periods ended
March 31, 2000 and 1999 5
Notes to Condensed Financial Statements 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS 7
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 10
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS 11
ITEM 2. CHANGES IN SECURITIES 11
ITEM 3. DEFAULTS UPON SENIOR SECURITIES 11
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 11
ITEM 5. OTHER INFORMATION 11
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 11
SIGNATURES 12
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2
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BOLDER TECHNOLOGIES CORPORATION
CONDENSED BALANCE SHEETS
(UNAUDITED)
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<CAPTION>
MARCH 31, DECEMBER 31,
2000 1999
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ASSETS
Current assets:
Cash and cash equivalents $ 8,559,480 $ 17,651,373
Available-for-sale securities 6,841,632 4,978,850
Trade accounts receivable, net 447,561 1,833,261
Inventory 4,256,638 1,656,539
Other current assets 309,152 251,710
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TOTAL CURRENT ASSETS 20,414,463 26,371,733
Property and equipment, at cost, net 21,315,977 21,162,603
Other assets, net 624,676 579,541
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TOTAL ASSETS $ 42,355,116 $ 48,113,877
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable and accrued liabilities $ 4,013,502 $ 4,405,328
Deferred revenue 43,750 35,000
Notes and capital leases, current portion 2,490,227 2,122,108
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TOTAL CURRENT LIABILITIES 6,547,479 6,562,436
Notes and capital leases, net of current portion 5,934,272 6,736,723
Commitments and contingencies
Stockholders' equity:
Convertible, redeemable preferred stock, $0.001 par
value, 5,000,000 shares authorized; 325,000 issued and
outstanding at March 31, 2000 and December 31, 1999,
with a liquidation and redemption value of
$16,250,000 16,073,333 15,653,939
Common Stock, $.001 par value, 25,000,000 shares
authorized; 14,600,168 and 14,577,826 shares issued
at March 31, 2000 and December 31, 1999,
respectively 14,600 14,578
Treasury stock, $.001 par common stock, 33,333
shares at March 31, 2000 and December 31, 1999 (50,000) (50,000)
Deferred compensation (972,621) (1,069,887)
Additional paid-in capital 72,707,072 72,989,247
Accumulated deficit (57,899,019) (52,723,159)
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TOTAL STOCKHOLDERS' EQUITY 29,873,365 34,814,718
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 42,355,116 $48,113,877
============ ============
</TABLE>
See accompanying notes
3
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BOLDER TECHNOLOGIES CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
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THREE MONTHS ENDED
MARCH 31,
------------------------------
2000 1999
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REVENUES
Product sales, net $ 219,797 $ 17,120
Research and development services and royalties 35,000 64,324
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254,797 81,444
COST OF REVENUES 1,999,497 62,615
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(1,744,700) 18,829
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OPERATING EXPENSES
Research and development 746,908 2,040,653
General and administrative 1,629,224 755,792
Selling and marketing 996,438 377,706
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3,372,570 3,174,151
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LOSS FROM OPERATIONS (5,117,270) (3,155,322)
OTHER INCOME (EXPENSE)
Interest income 228,974 115,179
Interest expense (287,564) (344,165)
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NET LOSS (5,175,860) (3,384,308)
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Dividend on preferred stock (365,625) (378,225)
Accretion of preferred stock offering costs (53,769) (53,769)
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NET LOSS ALLOCABLE TO COMMON STOCKHOLDERS $ (5,595,254) $ (3,816,302)
============ ============
Basic and diluted net loss per share $ (0.38) $ (0.39)
============ ============
Shares used in computing basic and diluted
net loss per share 14,560,034 9,689,197
============ ============
</TABLE>
See accompanying notes.
4
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BOLDER TECHNOLOGIES CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
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<CAPTION>
THREE MONTHS ENDED
MARCH 31,
------------------------------
2000 1999
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OPERATING ACTIVITIES
Net loss $ (5,175,860) $ (3,384,308)
Adjustments to reconcile net loss to net cash used in operating
activities:
Depreciation and amortization 520,260 313,545
Recognition of deferred compensation 97,266 --
Changes in operating assets and liabilities (1,650,809) (369,512)
------------ ------------
NET CASH USED IN OPERATING ACTIVITIES (6,209,143) (3,440,275)
INVESTING ACTIVITIES
Purchase of short term investments (2,831,595) --
Sale of short term investments 968,813 3,998,061
Purchases of property and equipment (657,145) (641,008)
Patent costs (65,729) (74,050)
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NET CASH USED IN INVESTING ACTIVITIES (2,585,656) 3,283,003
------------ ------------
FINANCING ACTIVITIES
Proceeds from issuance of common stock 137,237 63,549
Payments on notes payable and capital leases payable (434,331) (329,075)
------------ ------------
NET CASH USED IN FINANCING ACTIVITIES (297,094) (265,526)
------------ ------------
NET DECREASE IN CASH AND CASH EQUIVALENTS (9,091,893) (422,798)
Cash and cash equivalents, beginning of period 17,651,373 962,453
------------ ------------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 8,559,480 $ 539,655
============ ============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest $ 292,948 $ 348,564
============ ============
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING
AND FINANCING ACTIVITIES
Accretion of preferred stock offering costs $ 53,769 $ 53,769
============ ============
Preferred stock dividend accrual $ 365,625 $ 378,225
============ ============
</TABLE>
See accompanying notes.
5
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BOLDER TECHNOLOGIES CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2000 AND 1999 (UNAUDITED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The interim financial information of BOLDER Technologies Corporation (the
"Company" or "BOLDER") as of and for the three-month periods ended March 31,
2000 and 1999 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, 1999 included in the Company's Annual
Report on Form 10-K. 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, 2000 and 1999 are not necessarily
indicative of operating results to be expected for the full year.
At March 31, 2000, securities that have been excluded from basic and diluted net
loss per share because they would be antidilutive include 2,451,597 outstanding
options to purchase the Company's common stock, 291,641 outstanding warrants to
purchase the Company's common stock and 325,000 shares of Convertible,
Redeemable Preferred Stock, which are convertible into 1,083,333 shares of
common stock.
In December 1999, the Securities and Exchange Commission staff released Staff
Accounting Bulletin No. 101, "Revenue Recognition" ("SAB 101"). SAB 101 provides
interpretive guidance on the recognition, presentation and disclosure of revenue
in financial statements. The accounting impact of SAB 101 is required to be
determined no later than the Company's second fiscal quarter of 2000. If the
Company determines that its revenue recognition policies must change to be in
compliance with SAB 101, the implementation of SAB 101 will require the Company
to report the impact of this change as a cumulative effect of a change in
accounting principle as if SAB 101 had been implemented on January 1, 2000. The
Company is currently reviewing SAB 101 to determine what impact, if any, the
adoption of SAB 101 will have on its financial position and results of
operations. Implementation guidelines for this standard could lead to
unanticipated changes in the Company's current revenue recognition policies.
Such changes could affect the timing of the Company's future revenue and results
of operations.
In March 2000, the Financial Accounting Standards Board ("FASB") issued FASB
Interpretation No. 44, "Accounting for Certain Transactions Involving Stock
Compensation" ("FIN No. 44"). The Interpretation clarifies the application of
APB No. 25 for certain issues related to equity based instruments issued to
employees. FIN No. 44 is effective on July 1, 2000, except for certain
transactions, and will be applied on a prospective basis. Management believes
that FIN No. 44 will not have a significant impact on its financial statements.
6
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BOLDER TECHNOLOGIES CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Except for the historical information contained herein, this report may contain
forward-looking statements that involve risks and uncertainties, including
manufacturing risks associated with implementing new process technology,
achieving commercial-scale manufacturing levels, achieving consistent yields and
quality, uncertainty of market acceptance and the timing of market acceptance,
as well as other risks detailed from time to time in our filings with the
Securities and Exchange Commission, including our registration statement on Form
S-3 filed on August 31, 1999, the prospectus supplement filed November 8, 1999,
and the Form 10-K filed March 29, 2000. These risks (i) have materially and
adversely affected, and may in the future materially and adversely affect, our
results and (ii) have caused and may in the future cause such results to differ
materially from those expressed in any forward-looking statements made by us.
OVERVIEW
Since our inception in March 1991 until the launch of our first commercial
product in the second half of 1999, we were a development stage company,
principally engaged in the research and development of our TMF(R) battery
technology, to which we have devoted significant resources. In May 1997, we
moved to a new 127,000 square foot leased manufacturing facility and corporate
headquarters in Golden, Colorado. We believe this facility will accommodate
multiple production lines, two research and development ("R&D") lines, and all
of our other operations. In the third quarter of 1997, we installed our first
high-volume manufacturing line, designed to annually produce approximately four
million 1 Ah cells. For approximately the next year, we focused most of our
resources on qualifying the line for commercial production. In the fourth
quarter of 1998, we qualified our production line and introduced our 1 Ah cell,
which can be a modular building block for various battery packs.
Upon qualifying the production line and introducing our 1 Ah cell, our focus
shifted to the design, manufacture, and introduction of products based on our
TMF technology. On August 5, 1999, we introduced SECURESTART(TM), an instant
engine starter which employs our TMF technology and, specifically, the 1 Ah
cell. In August 1999, we entered into an agreement with Sears, Roebuck to supply
SECURESTART(TM) to approximately 2,000 Sears' stores. We began commercial
shipments of SECURESTART(TM) in October 1999, and SECURESTART(TM) is currently
available in the majority of Target stores, Sears Mall, Sears Dealer and Sears
Hardware stores, G. I. Joe Auto and Sporting Goods, The Hardware Stores in
Michigan and Home Hardware, the largest hardware chain in Canada.
SECURESTART(TM) is also available through a variety of catalogs, including Sky
Mall, Herringtons, West Marine and Sears Craftsman. During the first quarter of
2000, we continued to commercialize our Thin Metal Film (TMF(R)) technology and
launched the SECURESTART(TM) Marine jump-start product. As the first jump-start
line extension product, the SecureStart Marine is targeted toward the consumer
boat market and offers special corrosion-proof features. We believe that the
majority of our near-term revenues will be generated from sales of these two
SECURESTART(TM) products.
Our fourth quarter 1999 shipments to Sears included stocking orders in
anticipation of the holiday gift-giving period and the winter driving season. In
addition, we purposely delayed adding other major retailers to be assured of
meeting our product obligations to Sears. For both of these reasons, we expected
and realized lower first quarter 2000 revenues than in the fourth quarter 1999
period. Beyond the first quarter 2000, we expect gradually increasing sales from
existing customers, the addition of new retailers to the SECURESTART(TM)
distribution base and from the marketplace introduction of the marine version of
SECURESTART(TM) in the second quarter of 2000.
7
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Inventories increased to $4.3 million at March 31, 2000 from $1.6 million at
December 31, 1999. We believe there is some seasonal relationship to consumer
demand for the auto version of SECURESTART(TM), resulting in higher product
sales in the second half of the year than in the first half. With these seasonal
factors, along with the expectation of significantly more customers in the
second half of the year, we expect to further increase inventory levels during
the second and third quarters of 2000 to meet anticipated customer requirements.
If sales during 2000 are too low to allow us to substantially recover our
investment in inventories, we may be required to revalue certain inventories and
incur associated charges, which could be material, in the statement of
operations.
We believe that the task of improving the yield of our first production line,
the efficiency of the overall manufacturing process and the performance of our
TMF products will be an ongoing activity. Additional modifications will be
required from time to time to improve the production capability of our
production line. Similarly, changes in the design of our products will be
required from time to time in order to improve product performance.
In June 1995, we established a joint venture with JCI (the "Joint Venture") to
develop high-volume manufacturing technology for TMF batteries, manufacture TMF
batteries for sale by both JCI and ourselves, and pursue hybrid electric vehicle
battery development opportunities for TMF batteries. In 1997, having
substantially completed the primary objective of developing the high-volume
manufacturing technology, the Joint Venture was terminated and we entered into a
new relationship with JCI. Under the new relationship, JCI and we are separately
developing TMF battery-manufacturing facilities. We granted royalty-bearing
licenses to JCI, certain of which are subject to minimum royalties and minimum
performance criteria. These licenses give JCI the sole and exclusive right to
sell TMF batteries for use as primary starting batteries in automobiles and
trucks until July 2001. We have also entered into a cross supply agreement with
JCI pursuant to which each of us has committed to supply the other with minimum
quantities of TMF battery products for several years.
We believe that our 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.
RESULTS OF OPERATIONS
As we transitioned in the second half of 1999 from primarily development
activities to manufacturing and sales activities, the classification of certain
functions have changed in our statement of operations. For example, activities
which were previously performed prior to the third quarter 1999 in support of
our research and development ("R&D") efforts (and therefore classified as R&D
expense) have now evolved to support our manufacturing effort and are classified
as cost of revenues. Additionally, because our production volume of batteries
and other products is not yet sufficient to allow absorption of the
manufacturing overhead, we have incurred a loss on gross margin, which can be
expected to continue until production volumes are at significantly higher
levels.
Revenues from product sales increased to $219,797 from $17,120 for the
three-months ended March 31, 2000 and 1999, respectively. Product sales
increased due to the introduction of SECURESTART(TM), the instant engine starter
product, in the second half of 1999.
R&D services revenues and royalties declined to $35,000 from $64,324 for the
three-month periods ended March 31, 2000 and 1999, respectively. The decrease is
due to revenues from a customer-funded product development program of $29,324
for the three-month period ended March 31, 1999. This program was completed in
the first quarter 1999. The remaining amounts in this category ($35,000 in each
period) are from minimum royalties paid by Johnson Controls, who has licensed
our TMF technology for automotive applications.
Cost of revenues increased to $1,999,497 from $62,615 for the three-month
periods ended March 31, 2000 and 1999, respectively. Certain production line
functions and associated expenses that were previously related to R&D activities
in the first quarter 1999 were involved in supporting the commercial manufacture
of the 1 Ah cell in the first quarter of
8
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2000. The 1 Ah cells produced in the first quarter 2000 were primarily used for
assembly into SECURESTART(TM) units, which were shipped to customers or are
classified at March 31, 2000 as inventory. Also, cost of revenues increased in
the 2000 period due to higher production volumes, which resulted in increases in
labor, supplies and equipment expenses as compared to the previous year. In
addition, first quarter 2000 production levels do not allow full absorption of
fixed manufacturing overhead expenses, and the unabsorbed portion is included in
cost of revenues in the current period.
R&D expenses decreased to $746,908 from $2,040,653 for the three-month periods
ended March 31, 2000 and 1999, respectively. The decrease in 2000 was due to the
change in classification of certain production line functions and associated
expenses from R&D expenses to cost of revenues, as explained previously above.
Absent similar production line functions and associated expenses of $1,174,307
in the 1999 quarter that were properly classified as R&D expenses, the remaining
R&D expenses for product improvement and new product development were $866,346.
The decrease to $746,908 in the 2000 first quarter was primarily due to
reductions in staffing levels and related expenses in the 2000 period, as well
as non-recurring expenses incurred in the 1999 period relating to the
development of the SECURESTART(TM) unit.
General and administrative expenses increased to $1,629,224 for the three-month
period ended March 31, 2000, from $755,792 for the same period in the prior
year. Most of the increase in 2000 resulted from increases in legal fees,
compensation, recruiting and business insurance compared to the prior year.
Selling and marketing expenses increased to $996,438 for the three-month periods
ended March 31, 2000, from $377,706 for the same period in the prior year. The
increases in 2000 were primarily due to increased staffing levels, as well as
advertising and promotional activities associated with the Company's new
SECURESTART(TM) products.
Interest income increased to $228,974 from $115,179 for the three-month periods
ended March 31, 2000 and 1999, respectively. The increase was due to higher
average invested cash balances in 2000 than in 1999.
Interest expense decreased to $287,564 from $344,165 for the three-month periods
ended March 31, 2000 and 1999, respectively. The decrease in 2000 was due to
lower average debt balances in the 2000 period than in the prior year period.
LIQUIDITY AND CAPITAL RESOURCES
From our inception, we have financed our operations and met our capital
requirements primarily through private and public offerings of our equity
securities, raising net proceeds of approximately $86 million from sales of
these securities. Included in this amount are net proceeds of approximately
$33.9 million received from a combination of private and public offerings of
equity securities in May, July, November and December, 1999. In 1997 and 1998,
we received net proceeds of approximately $12.3 million from a loan agreement
with Transamerica Business Credit Corporation ("TBCC"). The remaining loan
balance was approximately $8.4 million as of March 31, 2000. At March 31, 2000,
our balances of cash, cash equivalents, and available-for-sale securities
totaled approximately $15.4 million, compared to approximately $22.6 million at
December 31, 1999.
We believe that our current balances of cash and cash equivalents, along with
an anticipated working capital financing based on accounts receivable and
inventory, would provide adequate capital resources to fund our operations and
working capital needs through the end of 2000. There can be no assurances that
working capital financing will be available, if at all, on terms favorable to
the Company. In addition, we will require substantial capital resources beyond
2000 for anticipated manufacturing capacity expansion, product development,
working capital and to fund operations until we achieve profitability.
Accordingly, we anticipate that we will need to secure equity financing in
2000. Our inability to obtain required capital when needed would have a
material adverse effect on our business, results of operations and financial
condition, as we could be required to reduce our levels of operations, delay
product development or other actions to diminish the amount of cash used in our
business.
9
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YEAR 2000
We rely on software in our information systems and manufacturing equipment. Most
of this equipment and software was installed and written within the past three
years. The Company has completed an inventory and tested its critical control
systems, computers, and application software. Prior to December 31, 1999, we
tested and validated each of the internal systems, equipment and software. The
Company has found these to be compliant, has applied supplier fixes, or replaced
the equipment. The Company implemented processes to identify and evaluate the
Y2K status of newly acquired equipment, and evaluated supplier and customer Y2K
compliance.
To date, we have had no significant problems related to Year 2000 issues. We
believe the remaining risks of Year 2000 issues are primarily external, due to
the difficulty of validating key third parties' readiness for Year 2000. The
Company has sought confirmation of such compliance and seeks relationships that
are compliant. The Company maintains contingency plans for each of these key
relationships as they arise, such as second sourcing, purchasing additional
inventory, and creating joint contingency plans for Year 2000 situations with
each relationship.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable because the Company has only fixed rate debt and no derivatives.
10
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BOLDER TECHNOLOGIES CORPORATION
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
From time to time we are subject to legal proceedings arising out of our
operations. In September 1999, Century Mfg. Co., a subsidiary of Pentair, Inc.,
filed a complaint against us in the United States District Court for the
District of Minnesota. Century, which manufactures a line of portable power and
jump-starting products, alleges among other things that we have misappropriated
Century's trade secrets and breached a confidentiality agreement in producing
and manufacturing SECURESTART(TM).
Century later filed a separate lawsuit alleging that the SECURESTART(TM) product
infringes a patent issued to Century in November 1999. That suit was
consolidated with the first action, and now all of Century's claims are pending
in the first action. We have answered Century's complaint and asserted
counterclaims for Century's misappropriation for our own trade secrets and
confidential information. We believe that Century's claims are without merit,
intend to defend against them vigorously, and intend to press vigorously our
counterclaims.
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
------- -------------------------
10.1 Transition Employment Agreement between the
Company and Daniel S. Lankford, dated December
16, 1999.
10.2 Transition Employment Agreement between the
Company and Sandra D. Schreiber, dated February
22, 2000.
27 Financial Data Schedule.
(b) During the first quarter 2000, the Company filed one report
on Form 8-K, dated March 24, 2000, pursuant to Item 5 of
such Form.
11
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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 12, 2000 By: /s/ Roger F. Warren
------------------- ----------------------------------
Roger F. Warren
Chief Executive Officer, President
and Chairman of the Board
By: /s/ Joseph F. Fojtasek
----------------------------------
Joseph F. Fojtasek
Vice President and Chief Financial
Officer (Principal Financial and
Accounting Officer)
12
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INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTIONS OF DOCUMENTS
- ------- -------------------------
10.1 Transition Employment Agreement between the Company and Daniel S.
Lankford, dated December 16, 1999.
10.2 Transition Employment Agreement between the Company and Sandra D.
Schreiber, dated February 22, 2000.
27 Financial Data Schedule.
<PAGE> 1
EXHIBIT 10.1
[BOLDER TECH LETTERHEAD]
DANIEL S. LANKFORD
Y2000 TRANSITION EMPLOYMENT AGREEMENT
o Lankford becomes a part time employee effective January 1, 2000 with no
benefits
o Remains on the Board indefinitely
o Will work and be paid for a minimum of 10 days per month through March 31,
and 5 days per month through June 30.
o May work additional days at the request of Roger Warren
o Pay for days worked will be at the rate of $2,000 per day.
o Stock options granted January 29, 1998 at $9.00 will vest during the period
January 1, 2000 through June 30, 2000 at the rate of 4,000 shares per
month, or a total of 24,000 shares.
o Lankford will be eligible for normal 1999 cash and stock bonus
o Will be paid for accrued vacation and personal time off as of the end of
full time employment.
o Part time employment agreement may be terminated by either party with 30
days notice.
o If terminated by Lankford, he foregoes further vesting after termination
and must exercise all outstanding options within 90 days of termination
o If terminated by BOLDER, unvested portion of 24,000 shares described above
vests on termination and stock option expiration as described below
applies.
o Stock Options Expire as Follows:
o 90 days after end of part time employment:
o 133,333 shares grant July 11, 1994 at $0.375
o 21,150 shares grant June 8, 1995 at $1.50
o 180 days after end of part time employment:
o 21,166 shares grant February 7, 1996 at $6.00
o 90 days after ceasing to be a director of the Company all remaining
shares must be exercised
December 16, 1999 /s/ Daniel S. Lankford
- -------------------------- -------------------------------
Date Daniel S. Lankford
Chairman of the Board
/s/ Roger F. Warren
-------------------------------
Roger F. Warren
President and CEO
<PAGE> 1
EXHIBIT 10.2
[BOLDER TECH LETTERHEAD]
SANDRA D. SCHREIBER
Y2000 TRANSITION AGREEMENT
o Schreiber remains a full time employee through the end of April.
o Becomes a part time employee from May through August 2000.
o Will work and be paid for a minimum of
o 10 days in May, June and July
o 5 days per month in August
o Will be guaranteed 5 days payment in September.
o Pay for days worked as a part time employee will be at a rate of $850 per
day.
o May work additional days at the request of Roger Warren.
o Will be paid for accrued vacation and personal time off as of the end of
full time employment.
o BOLDER will provide and cover cost of existing benefits package through
December 31, 2000.
o Stock options:
o All stock options vest at their current rate through August 2000.
o After August, Schreiber will receive $125.00 per working hour -- maximum of
$1000 per working day, on an "as needed" basis at the request of Roger
Warren. Schreiber will make reasonable effort to accommodate requests for
such work. Appropriate out-of-pocket expenses will be paid for or
reimbursed by Bolder. Bolder will indemnify, defend and otherwise hold
harmless Schreiber for all work performed.
o Rick Weitzel will be appointed to Vice President effective March 1, and
will assume all of Schreiber's existing direct report responsibilities.
Weitzel will report directly to Warren.
CONFIDENTIAL
<PAGE> 2
o For the period March 1 - August 31, Sandra Schreiber and Roger Warren will
agree on projects to be completed during that timeframe. Schreiber is
eligible to receive payment for any M.B.O. achievement through August 31,
as part of the 2000 Officer's Incentive Program. Should the objectives be
changed, they become payable to Schreiber as if achieved.
o Schreiber will be allowed to exercise vested stock options through January
31, 2001.
o Either party with 30 days notice may terminate this agreement.
o If this agreement is terminated by Bolder, Schreiber will be paid for
March, April and the difference between 5 months current salary and
payments made after April 30.
o If terminated by Schreiber, she must exercise options within 90 days of
termination.
/s/ Sandra D. Schreiber
----------------------------------------
Sandra D. Schreiber
SVP, Systems and Supply Chain
February 22, 2000 /s/ Roger F. Warren
- ----------------- ----------------------------------------
Date: Roger F. Warren
Chairman, President and CEO
CONFIDENTIAL
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