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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):
May 4, 2000
PLUG POWER INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 00027527 22-3672377
(State or other jurisdiction (Commission File (I.R.S. Employer
of incorporation) Number) Identification No.)
968 ALBANY-SHAKER ROAD
LATHAM, NY 12110
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code:
(518) 782-7700
Item 5. Other Events.
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On May 4, 2000, the Registrant issued a press release announcing first
quarter results and product development update. A copy of the press release is
attached as an Exhibit to this report on Form 8-K and is incorporated herein by
reference in its entirety.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
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(c) Exhibits.
Exhibit 99.1 - Press Release of Plug Power Inc. dated May 4, 2000.
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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.
PLUG POWER INC.
Date: May 4, 2000 By: /s/ William H. Largent
----------------------
William H. Largent
Chief Financial Officer
(Principal Financial and Accounting Officer)
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EXHIBIT INDEX
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EXHIBIT NO. DESCRIPTION
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Exhibit 99.1 Press release of Plug Power Inc. dated May 4, 2000
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Exhibit 99.1
[Plug Power Logo Appears Here]
NEWS RELEASE
For Immediate Release Contact: William H. Largent
May 4, 2000 Chief Financial Officer, Plug Power
Telephone: (518) 782-7700, ext. 1214
PLUG POWER INC. REPORTS FIRST QUARTER RESULTS AND
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PRODUCT DEVELOPMENT UPDATE
--------------------------
LATHAM, N.Y. -- Plug Power Inc. (NASDAQ: PLUG), today reported results for its
first quarter ended March 31, 2000.
Revenues for the first quarter of 2000 were $2.9 million as compared to
$1.7 million for the first quarter ended March 31, 1999. Net loss for the first
quarter of 2000 was $17.2 million, or $0.40 loss per diluted share, as compared
to $6.5 million, or $0.32 diluted loss per share, for the first quarter ended
March 31, 1999.
The current quarter loss includes a one-time charge of $5.0 million for the
write off of in-process research and development related to our acquisition of
intellectual property and certain other assets acquired from Gastec during the
quarter. The current quarter also includes a charge of $.6 million for
amortization related to the portion of the Gastec purchase price capitalized and
recorded on our balance sheet. The capitalized amount of $9.6 million will be
amortized through a charge to operations over the next five quarters. Without
the Gastec acquisition related charges our loss for the first quarter of 2000
would have been $11.7 million, or $0.27 diluted loss per share.
Weighted average shares outstanding at March 31, 2000 increased to 43.0 million
shares from 20.1 million at March 31, 1999. This increase was primarily as a
result of our October 1999 initial public offering of 6.8 million shares of
common stock and the issuance of 9.2 million shares of common stock as a result
of the exercise of outstanding warrants and other purchase rights at the time of
the initial public offering.
Financial results for the quarter were generally as expected and Plug Power's
financial position remains strong with $140.9 million in unrestricted cash at
March 31, 2000.
"This was an extremely busy quarter for the Plug Power team," said Gary
Mittleman, Plug Power president and CEO. "We completed the acquisition of
intellectual property related to fuel processing from Gastec, signed an
agreement with Vaillant to develop the next generation of fuel cell heating
appliances, acquired a 28 percent interest in Advanced Energy Systems to enhance
our power electronics technology and formed a strategic alliance with Axiva to
develop the next generation membrane electrode assembly."
During the first quarter Plug Power produced 22 fuel cell systems for both
laboratory and field testing. Plug Power now has a total of 17 systems
installed in the field, being fueled by natural gas and providing power to
houses and buildings. Every one of these systems is using a fuel
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processor of the Gastec design. These fuel cell systems are located on Long
Island, in Michigan and in the greater Albany, New York area. Five of them are
powering homes while the other 12 are providing electricity to buildings. While
these units are not the final commercial design, they enable Plug Power to
gather meaningful data that is critical to advance the design of the initial
commercial product.
"In addition to the 17 systems we have running in the field, our laboratory is
also a major proving ground," said Dr. Manmohan Dhar, Plug Power Vice President
and Chief Engineer of the Residential Program. "14 full systems are running in
our lab and, specialized development testing equipment is analyzing an
additional 62 components, stacks, membrane electrode assemblies, reformers and
sub assemblies." The data collected from these efforts will enable us to set our
sales and manufacturing forecasts for 2001. We expect to have this forecast in
place by year-end. We will provide quarterly updates on field tests.
"We are continuing to ramp up our production activities in order to produce 500
pre-commercial fuel cell systems by the year-end 2000," Mittleman added. "These
500 pre-commercial test and evaluation systems are expected to be sold or used
for: distribution through GE MicroGen and DTE Energy Company to various
customers and distributors; internal operational testing; and installation at
various locations in New York funded through grants to Plug Power from the State
of New York."
The pre-commercial units which Plug Power is now developing do not conform to
the specifications originally agreed upon with GE in February 1999. As a
result, GE is no longer contractually obligated to purchase the 485 units under
its take or pay commitment. We do however expect that GE will be purchasing a
large number of these modified designs during the remainder of this year and the
first half of 2001. We are currently working out the terms of this arrangement
and our relationship with GE remains intact. Plug Power has been advised that
GE continues to support product development, sales and distribution directed at
bringing the GE MicroGen/Plug Power commercial product to market.
Mittleman continued, "We have always set aggressive targets, and we intend to
stay aggressive. This internal attitude is responsible for getting us where we
are today. We are proud of the milestones achieved to date and believe that we
remain on track to bring our first commercial product to market in 2001."
Plug Power's first commercial systems are anticipated to provide power to homes
or buildings that are currently connected to the electric utility grid. The
consumer will be able to draw electricity from both the grid and the fuel cell
system to meet their power requirements. "The incremental fuel costs of running
the fuel cell system are considerably less than the price most users pay the
utility for their electricity and the fuel cell will provide most of the
customers' power needs," added Mittleman.
"An additional benefit, is the role our fuel cell system serves as a back-up
generator," Mittleman continued. "Should the electric grid fail, our fuel cell
will be able to continue lighting the house and powering most appliances
depending on the specific customer demand."
The benefits are not limited to the end customer. Many electric utilities will
also find this product attractive in managing their asset deployment around load
pockets. In fact, this design
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originated from a request from a large utility customer. Nearly all electric
utility companies have areas within their territory that have experienced
significant growth which the original grid network was not designed to handle.
Deploying fuel cells in those load pocket areas would reduce other capital
spending (i.e. transmission or distribution lines, substations, etc) which the
utility would otherwise have to make.
Following the initial roll out, future models will be designed to provide power
to homes that have no connection to the grid. Plug Power anticipates that these
systems will be available sometime in late 2001 or first half of 2002. "We have
run these systems in our labs, but have decided to release them a little later
because of their more demanding performance requirements," said Dhar.
Plug Power has scheduled a conference call on May 4 at 10:00 AM (EST) to review
its first quarter 2000 financial results. Interested parties are invited to
participate. To listen to the conference call, please call 913-981-4900. A
playback on our investor relations page will be available on the Plug Power
website after 5:00 PM on May 4. Please send any questions related to the
financial results to [email protected] or call Steven Zenker,
Director of Investor Relations at 518-782-7700 extension 1248.
Plug Power will hold its first public annual meeting of the stockholders on
Wednesday, May 24, 2000 at 10:00 AM (EST) at the Albany Marriott.
See the attached financial highlights for the first quarter 2000. For more
information on Plug Power visit our web site at http://www.plugpower.com.
Plug Power is a leading U.S. designer and developer of on-site, electricity
generation systems utilizing proton exchange membrane fuel cells for residential
applications. Since being founded in 1997, the Latham, N.Y.- based company has
grown from 22 to over 450 employees. Plug Power's strategic partners and
investors include DTE Energy Company, Michigan's largest electric utility;
Mechanical Technology Incorporated, an early developer of fuel cell
technologies; General Electric Company, one of the world's leading suppliers of
power generation technology and energy services; and Sempra Energy subsidiary,
Southern California Gas Company, the largest U.S. natural gas distribution
company.
###
This press release may include statements which are not historical facts and are
considered "forward- looking" within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements reflect Plug
Power's current views about future events and financial performance. These
forward-looking statements are identified by their use of terms and phrases such
as "believe," "expect," "plan," "anticipate," and similar expressions
identifying forward-looking statements. Investors should not rely on forward-
looking statements because they are subject to a variety of risks,
uncertainties, and other factors that could cause actual results to differ
materially from Plug Power's expectations, and Plug Power expressly does not
undertake any duty to update forward-looking statements. These factors include,
but are not limited to, the following: (i) the cost of development and market
acceptance of Plug Power's fuel cell systems, (ii) competitive factors, such as
price competition and new product introductions, (iii) meeting the timetable for
producing the planned 500 pre-commercial systems in 2000 or in
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the first half of 2001, (iv) meeting the internal product development milestones
necessary to introduce our first commercially viable product scheduled in 2001,
(v) meeting the internal product development milestone necessary to introduce
our first commercially viable grid independent product by the first half of
2002, (vi) the cost and availability of products, (vii) the cost of complying
with current governmental regulations, and (viii) other factors detailed from
time to time in Plug Power's filings with the Securities and Exchange
Commission.
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PLUG POWER INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
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<CAPTION>
(Unaudited)
March 31, December 31,
ASSETS 2000 1999
- ------------------------------------------------- ------------ ------------
<S> <C> <C>
Current assets:
Cash and cash equivalents $140,885,950 $171,496,286
Restricted cash 275,000 275,000
Accounts receivable 5,303,831 5,212,943
Inventory 1,327,272 304,711
Other current assets 202,474 124,380
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Total current assets 147,994,527 177,413,320
Restricted cash 5,600,274 5,600,274
Property, plant and equipment, net 26,122,079 23,333,791
Intangible assets 9,023,000 -
Investment in affiliates 11,598,000 9,778,250
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TOTAL ASSETS $200,337,880 $216,125,635
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LIABILITIES AND STOCKHOLDERS' EQUITY
- -------------------------------------------------
Current liabilities:
Accounts payable $ 4,340,357 $ 4,644,496
Accrued expenses and other currrent liabilities 3,626,664 3,557,301
------------ ------------
Total current liabilities 7,967,021 8,201,797
Long-term debt and other liabilities 6,439,221 6,517,304
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Total liabilities 14,406,242 14,719,101
Stockholders' equity 185,931,638 201,406,534
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $200,337,880 $216,125,635
============ ============
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PLUG POWER INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended March 31,
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2000 1999
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<S> <C> <C>
CONTRACT REVENUE $ 2,932,793 $ 1,737,757
Cost of contract revenue 3,898,747 2,183,404
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Loss on contracts (965,954) (445,647)
In-process research and development 4,984,000 -
Research and development expense 11,444,172 2,980,774
General and administrative expense 1,556,430 2,929,100
Interest expense 95,470 -
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Operating loss (19,046,026) (6,355,521)
Other income 2,308,166 43,750
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Loss before equity in losses of affiliate (16,737,860) (6,311,771)
Equity in losses of affiliate (508,000) (187,500)
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NET LOSS $(17,245,860) $ (6,499,271)
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LOSS PER SHARE - BASIC AND DILUTED $ (0.40) $ (0.32)
============ ============
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING 42,956,186 20,092,222
============ ============
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