SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------
Form 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): March 3, 1999
TURBODYNE TECHNOLOGIES INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 0-21391 95-4699061
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
21700 Oxnard Street, Suite 1550
Woodland Hills, CA 91367
(Address of Principal Executive Offices)
(818) 593-2282
(Registrant's Telephone Number)
1
<PAGE>
ITEM 5. OTHER EVENTS
Reference is made to Registrant's press releases issued on March 3,
1999, March 5, 1999 and March 6, 1999, which contain information meeting the
requirements of this Item 5, and which are incorporated herein by this
reference. Copies of the press releases are attached to this Form 8-K as
Exhibits 99.1, 99.2 and 99.3.
2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
March 9, 1999 TURBODYNE TECHNOLOGIES INC.
By: /S/ KHAL A. KADER
-------------------------------
Khal A. Kader
Chief Financial Officer
3
<PAGE>
EXHIBIT INDEX
EXHIBITS PAGE NUMBER
- -------- -----------
99.1 Press Release dated March 3, 1999. 2
99.2 Press Release dated March 5, 1999. 6
99.3 Press Release dated March 6, 1999. 8
1
EXHIBIT 99.1
COMPANY ANNOUNCEMENT: EASDAQ ANNOUNCES TURBODYNE DECISION
EASDAQ Announces Turbodyne Decision
On 1 March 1999, the EASDAQ Market Authority held a hearing to consider
disciplinary action against Turbodyne Technologies, Inc. ("TRBD") for allegedly,
amongst other things, issuing a number of press releases which contained false
or misleading price sensitive information to the Market.
This hearing represented the conclusion of an investigation conducted by the
EASDAQ Surveillance Department.
Following TRBD's provision of additional documentary evidence concerning the
original press releases, as well as discussions conducted with the company's
representatives, the Market Authority has concluded that the TRBD press releases
were not intentionally misleading, but nevertheless gave an over-optimistic
impression of the company's prospects.
In order to correct this position, the Market Authority directed the company:
o Immediately, to release complete and accurate information on certain contracts
and agreements.
o To take steps to ensure that future press releases are timely, complete and
accurate, and to make these steps known publicly. The Market Authority has
concluded that investors' interests would best be served if the temporary halt
on trading were to be removed on condition that TRBD agreed to the measures set
out above.
TRBD has accepted the direction of the Market Authority and has issued the
attached statement.
Based upon TRBD's agreement to take these steps, and its commitment to ensure
that effective measures are taken to ensure the completeness and accuracy of all
future communications with the public, the Market Authority has determined that
trading in TRBD shares will resume at 09:30 CET on Monday, 8 March 1999.
TURBODYNE ANNOUNCEMENT
Woodlands Hills, Ca - March 3, 1999 - Turbodyne Technologies Inc. (Nasdaq: TRBD,
EASDAQ: TRBD) announces that it met with EASDAQ on March 1, 1999 pursuant to its
scheduled hearing. Following the completion of a full investigation, at the
request of
2
<PAGE>
EASDAQ, the Company makes the following announcement regarding certain of its
policies and business relationships.
The Board of Directors of Turbodyne has established certain committees composed
of members of management and outside directors and attorneys located in the
United States and Europe. The purposes of these committees are to review all
press releases and other disclosures prior to public dissemination and to
establish controls and procedures to maintain the confidentiality of material
information within and outside of the Company. These commitees also shall serve
to ensure full and prompt responses to requests for information from the EASDAQ
Market Authority and other competent bodies within EASDAQ and full compliance
with all continuing obligations of EASDAQ.
OEM Contract. On May 26, 1998, the Company announced that a major European
vehicle and engine manufacturer has selected Turbodyne's Turbopac (TM) models
1500 and 2200 for incorporation as standard equipment on three classes of
engines being manufactured for the 1999 model year. The manufacturer has been
testing the Company's products since 1996 and selected the Company's products
based on prototype testing units. Following selection of the Company's products,
the manufacturer requested testing of actual production units as configured for
mass production. Unlike the domestic passenger car industry, where a "model
year" typically begins in September or October, the commercial vehicle
industry's "model year" typically coincides with the calendar year. The Company
has been informed by the manufacturer that its products will be incorporated as
standard equipment on certain models of two main classes of engines and offered
as an option to fleet operators and certain other customers on other types of
engines. The Company also has been informed that the date the manufacturer will
commence serial production of engines with Turbodyne as standard equipment has
been extended with a production release date during the fourth quarter of 1999
and serially manufacturing in the first quarter of year 2000. To date, the
Company has shipped a total of eight Turbopacs to the manufacturer pursuant to
purchase orders which have been recorded as sales. Pursuant to the terms of the
Company's confidential agreement, it is prohibited from disclosing the name of
the manufacturer until vehicles and engines with Turbopacs reach the market
place.
Detroit Diesel. As earlier announced, the Company executed an Exclusive Supply
Agreement with Detroit Diesel Corporation pursuant to which Detroit Diesel
agreed to market exclusively the Turbopac(TM) as part of an "emission update
kit" to be certified for use in the United States Environmental Protection
Agency's Urban Bus Retrofit/Rebuild Program. As part of the Exclusive Supply
Agreement, Detroit Diesel supplied the Company with a forecast of quantity
requirements equal to 1250 Turbopacs. In April, 1998, the United States EPA
certified the kit. To date, the Company has sold 227 Turbopacs which were
recorded as sales under this program.
Viessmann Werke. On January 16, 1996, the Company agreed to a Product
Development and Supply Proposal with Viessmann Werke GmbH & Co. under which the
Company agreed to
3
<PAGE>
develop several models of the Company's Turboflow(TM) industrial fan modules for
incorporation into Viessmann's heating systems. The proposal contemplated that
the parties would enter into a supply and delivery contract upon the completion
of testing by Viesmann and subject to its approval of performance and
specifications. In May 1997, the Company was informed that Viessmann had
completed testing of the Company's products to its full satisfaction and the
Company expected to enter into a supply and delivery contract with Viessmann.
However, as announced earlier in the Company's registration statement on Form
F-1 filed with the Securities and Exchange Commission on December 29, 1997,
based on changes in the management of Viessmann, the Company does not expect any
sales or revenues from its relationship with Viessmann.
Shell Oil. On March 14, 1996, the Company announced that it had accepted a
proposal from Shell Oil Products for testing of its Turbopac (TM) and
Dynacharger(TM) Systems. The announcement also provided that the Company agreed
to develop with Shell a proposal to joint venture the manufacturing and
marketing of Turbodyne's products on a world wide basis and that any joint
venture would be subject to negotiations. Due to logistical considerations,
rather than testing the Company's products on Shell's delivery vehicles, the
parties decided to test the products under the Company's then existing program
with Southwest Research Institute, as well as under the Company's ongoing
testing and evaluation programs with OEM customers. Southwest has tested the
Company's products in connection with several programs, including testing of the
emission upgrade kit which was certified by the United States EPA in April 1998.
The Company is continuing its testing and evaluation programs with OEMs and
other entities and the results of the tests have been and will continue to be
supplied to Shell for its consideration. The Company cannot provide any
assurance that a joint venture will be established with Shell or that any other
business relashionship will be formed.
Trans Business Group. In June 1998, the Company announced that it had entered
into a Letter of Intent with Trans Business Group of Moscow, Russia for the sale
of 10,500 Turbopac(TM) models 1500, 2200 and 2500 for cars, buses and trucks
with deliveries expected to begin during the third quarter of 1998. The release
also announced that the Company received the official Export-Import Bank of the
United States "Letter of Interest" for funding of the expected purchase order.
In July 1998, the Company announced that it had received the formal purchase
order from Trans Business. The purchase order is subject to the completion of
financing arrangements necessary to fund the purchase of the Turbopacs. As the
Company earlier announced in its filings with the Securities and Exchange
Commission, the Company has been working with the Export-Import Bank to provide
financing for this transaction but to date, due to the severe volatility in the
Russian financial markets and continuing political instability, these financing
arrangements have not been completed. While the Company and Trans Business
continue to explore alternatives to complete the financing arrangements, the
Company cannot provide any assurance that the financing arrangements will be
completed in the near term, or at all. If these arrangements are not completed,
the Company will not make sales under its agreement with Trans Business.
4
<PAGE>
Turbopac(TM) sales to date. To date, Turbodyne has sold 411 Turbopacs(TM) for
aggregate revenue of $819,647. Of the Turbopacs(TM) sold to date, approximately
26 Turbopacs(TM) have been sold for testing purposes and 385 have been sold for
incorporation into end user vehicles.
While the Company deeply regrets the halt in trading on the EASDAQ market and
the resulting inconvenience to its stockholders, it believes that the complete
investigation concluded by the EASDAQ Market Authorities, the implementation of
controls and procedures by the Company, and the updating of information relating
to its business relationships, will help to dispel any misconceptions regarding
the Company, the Turbodyne Technology and the Company's business relationships
in the marketplace and the public media.
Management wishes to express its gratitude to the stockholders, employees and
consultants who have continued to support the Company during the investigations.
Turbodyne Systems, the Engine and Pollution Technology Division of Turbodyne,
designs, develops, manufactures and markets patented pollution-reduction, fuel
economy and performance enhancing products for internal combustion engines in
the automotive, transportation, construction, marine, agriculture, mining,
military and power generation industries. Turbodyne's Light Metals Division is a
manufacturer of machined aluminium castings and a leading supplier to the
automotive industry.
Offices and/or plants are located in Carpinteria, la Mirada, Encinitas and
Woodland Hills, CA, New York, NY; Ensenada and Mexico City, Mexico; Vancouver,
Canada; Northants, England; Paris, France; and Frankfurt, Germany.
Turbodyne's worldwideweb address is : www.turbodyne.com
CONTACT: Mark White, Investor Relations, 800 350 2031
Peter Kitzinski, General Manager Turbodyne Europe, 49 69 975 44 501
Peter Weichselbraun, Corporate Communications, 800 566 1130
5
EXHIBIT 99.2
TURBODYNE EXECUTES EXCLUSIVE LICENSING AND JOINT DEVELOPMENT CONTRACTS WITH
ALLIEDSIGNAL
WOODLAND HILLS, Calif.--(BUSINESS WIRE)--March 5, 1999--Turbodyne
Technologies Inc. (NASDAQ:TRBD - NEWS; Easdaq:TRBD) Friday announced that joint
development and licensing agreements have been signed with AlliedSignal Inc. of
Morristown, N.J.
Under the terms of the agreements, AlliedSignal and Turbodyne will engage in a
concerted effort for development and manufacturing engineering for mass
production capability of Dynacharger(tm) turbochargers and other electrically
assisted charge air systems.
Development costs will be shared by the parties. Under the terms of the
agreements, AlliedSignal has the exclusive license for manufacturing and
marketing of any products to be developed on a worldwide basis. Any products to
be developed under the agreements are anticipated to be sold primarily to
automobile, heavy duty vehicle and engine manufacturers.
There is no up front license payment payable to Turbodyne.
Turbodyne has the exclusive license for the manufacturing of all light metal
castings, electric motors, generators and electronic controls of any products to
be developed under the agreements for sale to AlliedSignal. Under the exclusive
license agreement, Turbodyne is the exclusive supplier to AlliedSignal of these
products.
Under the terms of the agreements, Turbodyne has exclusively licensed applicable
patents, intellectual property and trade secrets to AlliedSignal for manufacture
and sale of the Dynacharger(tm) products. AlliedSignal has sublicensed Turbodyne
under the patents, intellectual property and trade secrets required for
manufacture of the electrical components for the products.
Additionally, all new patents and intellectual property developed by the parties
under the joint development program will be subject to the license agreement for
exclusive use by AlliedSignal and Turbodyne or mutually agreed upon third party
sublicensees.
In addition to the exclusive right to supply the light metals, electric motors
and electronic control modules to AlliedSignal for any Dynacharger(tm) products
developed under the agreements, Turbodyne will receive a royalty on sales by
AlliedSignal of those products. Turbodyne does not guarantee that any sales will
be made. Turbodyne also retains the exclusive right to manufacture and sell its
Turbopac(tm) or Turboflow product lines as currently in production.
Turbodyne's sublicense further includes the right to manufacture and sell
electrical motor assistance systems for Cummins BHT turbochargers in the
aftermarket pending development of
6
<PAGE>
AlliedSignal's capability, capacity and interest in the sale and production of
those products. If AlliedSignal develops the capability, capacity and interest
in the sale and production of those products, the sublicense terminates.
Among other provisions, the agreements provide for termination by AlliedSignal
if the development program proves to be commercially or technically unfeasible.
Turbodyne also has the right to terminate in the event certain production
commitment milestones are not met.
AlliedSignal and Turbodyne began discussions on joint development in 1995 and
have jointly cooperated in supplying AlliedSignal turbochargers, which have been
specially modified with Turbodyne's electric motor and electronic control
technology, to potential customers for test and evaluation.
Turbodyne is a supplier of machined aluminum castings for AlliedSignal's
Turbocharging Systems business unit.
Turbodyne Systems, the Engine and Pollution Technology Division of Turbodyne,
designs, develops, manufactures and markets patented pollution-reduction fuel
economy and performance enhancing products for internal combustion engines in
the automotive, transportation, construction, marine, agriculture, mining,
military and power generation industries.
Turbodyne's Light Metals Division is a manufacturer of machined aluminum
castings and a leading supplier to the automotive industry.
Offices and/or plants are located in Carpinteria, La Mirada, Encinitas and
Woodland Hills, Calif.; New York; Ensenada and Mexico City, Mexico; Vancouver,
Canada; Paris; and Frankfurt, Germany.
Turbodyne's World Wide Web address is: www.turbodyne.com.
CONTACT:
Turbodyne Technologies
Mark White, 800/350-2031 (investor relations)
Peter Kitzinski, 49-69-975-44-501 (Europe)
Peter Weichselbraun, 800/566-1130
7
EXHIBIT 99.3
COMPANY ANNOUNCEMENT: TURBODYNE RELEASE
Woodland Hills, CA - March 6, 1999 - Turbodyne Technologies Inc. (NASDAQ: TRBD;
EASDAQ: TRBD) today reported that in the matter of the binding arbitration
between Grand Technologies, Inc. and the Company, the arbitrator has determined
that the Company is liable to Grand for damages in the amount of approximately
$6.65 million as a result of negligent misrepresentation, breach of contract and
breach of a purchase order. The Company strongly denies any wrongdoing and will
vigorously seek judicial review to have this award vacated as the Company
believes that the arbitrator exceeded his powers. There can be no assurance that
the Company will be successful in this effort.
Turbodyne Systems, the Engine and Pollution Technology Division of Turbodyne,
designs, develops, manufactures and markets patented pollution-reduction, fuel
economy and performance enhancing products for internal combustion engines in
the automotive, transportation, construction, marine, agriculture, mining,
military and power generation industries. Turbodyne's Light Metals Division is a
manufacturer of machined aluminum castings and a leading supplier to the
automotive industry.
Offices and/or plants are located in Carpenteria, La Mirada, Encinitas and
Woodland Hills, California; New York; Ensenada and Mexico City, Mexico;
Vancouver, Canada; Paris France; and Frankfurt, Germany.
Turbodyne's World Wide Web address is: www.turbodyne.com.
CONTACT: Mark White, Investor Relations, (800) 350-2031 Peter Kitzinski, General
Manager Turbodyne Europe, 49-69-975-44- 501 Peter Weichselbraun, Corporate
Communications, (800) 566-1130
8
