<PAGE>
===============================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM 10-Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MARCH 31, 2000
/ / 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 0-10964
MAXWELL TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 95-2390133
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9275 SKY PARK COURT, SAN DIEGO, CA 92123-4303
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code: (858) 279-5100
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 / /
As of April 30, 2000, Registrant had only one class of common stock, of which
there were 9,757,590 outstanding.
================================================================================
<PAGE>
MAXWELL TECHNOLOGIES, INC.
INDEX TO QUARTERLY REPORT ON FORM 10-Q
FOR THE PERIOD ENDED MARCH 31, 2000
<TABLE>
<CAPTION>
PAGE
--------
PART I
<S> <C>
Item 1. Condensed Consolidated Financial Statements.......................................................... 1
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations................ 9
Item 3. Quantitative and Qualitative Disclosures About Market Risk........................................... 17
PART II
Item 1. Legal Proceedings.................................................................................... 18
Item 2. Changes in Securities and Use of Proceeds............................................................ 18
Item 3. Defaults Upon Senior Securities...................................................................... 18
Item 4. Submission of Matters to a Vote of Security Holders.................................................. 18
Item 5. Other Information ................................................................................... 18
Item 6. Exhibits and Reports on Form 8-K..................................................................... 18
</TABLE>
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
MAXWELL TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
2000 1999
---------------- -----------------
ASSETS (UNAUDITED) (NOTE)
<S> <C> <C>
Current assets:
Cash and cash equivalents............................................... $ 3,603 $ 4,065
Accounts receivable, net................................................ 35,602 30,381
Inventories............................................................. 23,404 22,015
Prepaid expenses and other current assets............................... 2,940 691
Deferred income taxes................................................... 15,964 14,740
Net assets of discontinued operations................................... 625 3,564
---------------- -----------------
Total current assets.................................................. 82,138 75,456
Property, plant and equipment, net......................................... 19,033 18,340
Goodwill and other non-current assets...................................... 13,410 11,985
---------------- -----------------
$114,581 $105,781
================ =================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities................................ $ 17,311 $ 13,639
Accrued employee compensation........................................... 6,693 5,382
Current portion of long-term debt and short-term borrowings............. 5,453 278
---------------- -----------------
Total current liabilities............................................. 29,457 19,299
Long-term debt, excluding current portion.................................. 178 181
Minority interest.......................................................... 1,778 1,885
Commitments and contingencies
Stockholders' equity:
Common stock............................................................ 969 957
Additional paid-in capital.............................................. 79,587 78,378
Notes receivable from executives for stock purchases.................... (900) --
Deferred compensation................................................... (65) (117)
Retained earnings....................................................... 3,884 5,375
Accumulated other comprehensive income (loss) - foreign
currency translation adjustments...................................... (307) (177)
---------------- -----------------
83,168 84,416
---------------- -----------------
$114,581 $105,781
================ =================
</TABLE>
Note: The Balance Sheet at December 31, 1999 has been derived from the audited
financial statements as of that date.
See notes to condensed consolidated financial statements.
1
<PAGE>
MAXWELL TECHNOLOGIES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
---------------------------------------------------------
DECEMBER 31,
MARCH 31, 2000 1999 MARCH 31, 1999
----------------- ---------------- ---------------
<S> <C> <C> <C>
Sales...................................................... $35,929 $ 31,409 $36,821
Cost of sales.............................................. 27,310 25,861 24,022
----------------- ---------------- ---------------
Gross profit............................................... 8,619 5,548 12,799
Operating expenses:
Selling, general and administrative..................... 8,995 10,792 7,825
Research and development................................ 1,630 2,298 1,890
Restructuring, acquisition and other charges............ 523 4,953 1,491
----------------- ---------------- ---------------
Total operating expenses.............................. 11,148 18,043 11,206
----------------- ---------------- ---------------
Operating income (loss).................................... (2,529) (12,495) 1,593
Interest expense........................................... (74) (95) (66)
Interest income and other, net............................. 45 65 388
----------------- ---------------- ---------------
Income (loss) before income taxes and minority interest.... (2,558) (12,525) 1,915
Provision (credit) for income taxes........................ (1,023) (5,109) 171
Minority interest in net income (loss) of subsidiaries..... (107) (410) 83
----------------- ---------------- ---------------
Income (loss) from continuing operations................... (1,428) (7,006) 1,661
Discontinued operations, net of tax:
Income (loss) from operations........................... (379) (2,310) 275
Provision (credit) for estimated loss on disposal....... 316 (2,065) --
----------------- ---------------- ---------------
(63) (4,375) 275
----------------- ---------------- ---------------
Net income (loss).......................................... $ (1,491) $(11,381) $ 1,936
================= ================ ===============
Basic net income (loss) per share:
Income (loss) from continuing operations................ $ (0.15) $ (0.73) $ 0.17
Income (loss) from discontinued operations.............. -- (0.46) 0.03
----------------- ---------------- ---------------
$ (0.15) $ (1.19) $ 0.20
================= ================ ===============
Diluted net income (loss) per share
Income (loss) from continuing operations................ $ (0.15) $ (0.73) $ 0.16
Income (loss) from discontinued operations.............. -- (0.46) 0.03
----------------- ---------------- ---------------
$ (0.15) $ (1.19) $ 0.19
================= ================ ===============
Shares used in computing:
Basic net income (loss) per share....................... 9,727 9,564 9,500
================= ================ ===============
Diluted net income (loss) per share..................... 9,727 9,564 9,953
================= ================ ===============
</TABLE>
See notes to condensed consolidated financial statements.
2
<PAGE>
MAXWELL TECHNOLOGIES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
----------------------------------
2000 1999
--------------- --------------
<S> <C> <C>
Operating activities:
Income (loss) from continuing operations.................................... $(1,428) $1,661
Adjustments to reconcile income (loss) from continuing operations
to net cash used in operating activities:
Depreciation and amortization........................................... 1,399 1,373
Restructuring, acquisition and other charges............................ 523 1,491
Deferred compensation................................................... 52 60
Minority interest in net income (loss) of subsidiaries.................. (107) 83
Changes in operating assets and liabilities, net........................ (5,830) (9,400)
--------------- --------------
Net cash used in operating activities................................. (5,391) (4,732)
Investing activities:
Purchases of property and equipment......................................... (1,352) (1,879)
Proceeds from sale of businesses............................................ 3,500 --
--------------- --------------
Net cash provided by (used in) investing activities................... 2,148 (1,879)
Financing activities:
Proceeds from short-term borrowings......................................... 5,229 1,262
Principal payments on long-term debt and short-term borrowings.............. (57) (47)
Proceeds from issuance of Company and subsidiary stock...................... 46 1,077
Repurchase of Company and subsidiary stock.................................. -- (354)
--------------- --------------
Net cash provided by financing activities............................. 5,218 1,938
Net cash provided by (used in) discontinued operations......................... (2,411) 442
Effect of exchange rate changes on cash and cash equivalents................... (26) (25)
--------------- --------------
Decrease in cash and cash equivalents.......................................... (462) (4,256)
Cash and cash equivalents at beginning of period............................... 4,065 12,786
--------------- --------------
Cash and cash equivalents at end of period..................................... $ 3,603 $8,530
=============== ==============
</TABLE>
See notes to condensed consolidated financial statements.
3
<PAGE>
MAXWELL TECHNOLOGIES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - GENERAL
Maxwell Technologies, Inc. ("Maxwell" or the "Company") applies
industry-leading capabilities in power and computing to develop and market
products and services for customers in multiple industries, including energy,
satellite, defense, telecommunications, consumer electronics, medical and
bioprocessing markets.
In November 1999, the Company's Board of Directors adopted a resolution
to change the Company's fiscal year to a calendar year effective January 1,
2000. The Company previously reported results on a fiscal year of August 1
through July 31. During the five-month transition period from August 1 to
December 31, 1999, the Company adopted a plan to restructure its operations
(the "Restructuring Plan"). This Restructuring Plan (i) consolidates certain
commercial business operations and improves their manufacturing and other
operational capabilities, (ii) focuses the defense contracting business on
pulsed power systems and computer-based analysis for government and national
laboratories, (iii) focuses the application of PUREBRIGHT-Registered
Trademark- technology on bioprocessing, medical and consumer water markets,
and (iv) provides for the sale of certain non-strategic business operations.
The accompanying condensed consolidated financial statements have been
reclassified to present the financial position and results of operations of
the continuing businesses of the Company. Businesses which the Company
intends to sell or discontinue, and certain businesses sold or discontinued
by the Company in prior periods, have been classified as discontinued
operations in the accompanying condensed consolidated financial statements.
For additional comparative purposes, certain statement of operations data
is presented for the three months ended December 31, 1999, in addition to the
three months ended March 31, 2000 and 1999. It is management's opinion that
comparing current results to the December period is more meaningful than a
comparison to the first quarter of 1999, due to the effects of the Company's
Restructuring Plan and reduced revenue and profit contributions from licensing
and strategic transactions compared to the prior year.
The accompanying unaudited interim condensed consolidated financial
statements contain all adjustments (consisting of normal recurring accruals)
which are, in the opinion of management, necessary for a fair and accurate
presentation of financial position at March 31, 2000 and the results of
operations for the three-month periods ended March 31, 2000, December 31, 1999
and March 31, 1999. These interim financial statements should be read in
conjunction with the Company's audited consolidated financial statements and
notes thereto included in its Annual Report on Form 10-K for the five-month
period from August 1, 1999 to December 31, 1999. Interim results are not
necessarily indicative of those to be expected for the full year.
The consolidated financial statements include the accounts of Maxwell
Technologies, Inc. and its subsidiaries. All significant intercompany
transactions and account balances are eliminated in consolidation.
NOTE 2 - INVENTORIES
Inventories consist of the following (in thousands):
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
2000 1999
---------------- -----------------
<S> <C> <C>
Finished products.......................................................... $ 3,761 $ 2,030
Work in process............................................................ 5,443 4,469
Parts and raw materials.................................................... 14,200 15,516
---------------- -----------------
$23,404 $22,015
================ =================
</TABLE>
4
<PAGE>
MAXWELL TECHNOLOGIES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 3 - CREDIT AGREEMENT
In May 2000, the Company agreed with its bank to amend the Company's $20
million bank line-of-credit agreement to modify certain financial covenants; to
adjust the interest rate at which the Company may borrow to the bank's reference
rate plus .25% or LIBOR plus 2.5%; and, to provide for the lender to receive a
general security interest in the personal property of the Company and its
subsidiaries in the United States, excluding PurePulse Technologies, Inc. At
March 31, 2000, the Company was in compliance with all covenants and conditions
of the amended agreement. Outstanding borrowings under the agreement were $5.0
million at March 31, 2000, at a weighted average interest rate of 7.3%.
NOTE 4 - COMPREHENSIVE INCOME (LOSS)
The Company reports and displays comprehensive income (loss) in accordance
with Statement of Financial Accounting Standards No. 130, REPORTING
COMPREHENSIVE INCOME. The components of comprehensive income (loss) for the
three months ended March 31, 2000 and 1999 were as follows (in thousands):
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
--------------------------------------
2000 1999
---------------- -----------------
<S> <C> <C>
Net income (loss).......................................................... $(1,491) $1,936
Foreign currency translation adjustments................................... (130) (25)
---------------- -----------------
Comprehensive income (loss)................................................ $(1,621) $1,911
================ =================
</TABLE>
NOTE 5 - INCOME (LOSS) PER SHARE
The Company reports basic and diluted income (loss) per share in accordance
with Financial Accounting Standards Board Statement No. 128, EARNINGS PER SHARE
("Statement No. 128"). Basic income (loss) per share is calculated using the
weighted average number of common shares outstanding. Diluted income (loss) per
share is calculated on the basis of the weighted average number of common shares
outstanding plus the dilutive effect of outstanding stock options, assuming
their exercise using the "treasury stock" method, and convertible preferred
shares outstanding at certain subsidiaries of the Company, assuming their
conversion. For the three months ended March 31, 2000, all potentially dilutive
securities were excluded from the calculation of diluted loss per share as their
inclusion would have been antidilutive.
5
<PAGE>
MAXWELL TECHNOLOGIES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 5 - INCOME (LOSS) PER SHARE (CONTINUED)
The following table sets forth the computation of basic and diluted income
(loss) per share (in thousands, except per share amounts).
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
--------------------------------------
2000 1999
---------------- -----------------
<S> <C> <C>
Basic:
Income (loss) from continuing operations................................ $(1,428) $1,661
Income (loss) from discontinued operations.............................. (63) 275
---------------- -----------------
Net income (loss)....................................................... $(1,491) $1,936
---------------- -----------------
Weighted average shares.................................................... 9,727 9,500
================ =================
Basic income (loss) per share:
Income (loss) from continuing operations................................ $ (0.15) $ 0.17
Income (loss) from discontinued operations.............................. -- 0.03
---------------- -----------------
Basic income (loss) per share........................................... $ (0.15) $ 0.20
================ =================
Diluted:
Income (loss) from continuing operations................................ $(1,428) $1,661
Effect of dilutive securities of majority-owned subsidiaries............ -- (24)
---------------- -----------------
Income (loss) from continuing operations available to common shareholders,
as adjusted........................................................... (1,428) 1,637
Income (loss) from discontinued operations.............................. (63) 275
---------------- -----------------
Net income (loss), as adjusted.......................................... $(1,491) $1,912
================ =================
Weighted average shares.................................................... 9,727 9,500
Effect of dilutive stock options and other securities...................... -- 453
---------------- -----------------
Weighted average shares, as adjusted....................................... 9,727 9,953
================ =================
Diluted income (loss) per share:
Income (loss) from continuing operations................................ $ (0.15) $ 0.16
Income (loss) from discontinued operations.............................. -- 0.03
---------------- -----------------
Diluted income (loss) per share......................................... $ (0.15) $ 0.19
================ =================
</TABLE>
NOTE 6 - BUSINESS SEGMENTS
Maxwell evaluates the performance of its business segments and allocates
resources based on a measure of segment operating profit (loss), excluding
restructuring, acquisition and other charges. Maxwell does not evaluate
segment performance on amounts provided for restructuring, acquisition and
other charges, or on items of income or expense below operating profit
(loss). Accordingly, such items are not segregated by operating segment.
6
<PAGE>
MAXWELL TECHNOLOGIES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 6 - BUSINESS SEGMENTS (CONTINUED)
The following table sets forth sales and operating income (loss) data for
each of the Company's four business segments as defined by the Company under the
guidelines of Financial Accounting Standards Board Statement No. 131,
DISCLOSURES ABOUT SEGMENTS OF AN ENTERPRISE AND RELATED INFORMATION (in
thousands).
<TABLE>
<CAPTION>
THREE MONTHS ENDED
---------------------------------------------------
MARCH 31, DECEMBER 31, MARCH 31,
2000 1999 1999
--------------- --------------- --------------
Sales:
<S> <C> <C> <C>
Power and Computing Systems................................ $17,486 $ 15,311 $16,138
Electronic Components...................................... 7,332 5,304 7,620
Government Systems......................................... 10,755 10,372 10,828
Sterilization and Purification Systems..................... 356 422 2,235
--------------- --------------- --------------
Consolidated total....................................... $35,929 $ 31,409 $36,821
=============== =============== ==============
Operating profit (loss):
Power and Computing Systems................................ $ 997 $ (489) $ 640
Electronic Components...................................... (1,560) (3,379) (336)
Government Systems......................................... 889 (242) 1,824
Sterilization and Purification Systems..................... (1,150) (2,220) 502
--------------- --------------- --------------
Total segment operating profit (loss).................... (824) (6,330) 2,630
Corporate expenses, including total
restructuring, acquisition and other charges............. (1,705) (6,165) (1,037)
--------------- --------------- --------------
Consolidated total....................................... $(2,529) $(12,495) $ 1,593
=============== =============== ==============
</TABLE>
NOTE 7 - RESTRUCTURING AND OTHER RELATED CHARGES
In connection with the Restructuring Plan, the Company has undertaken
various actions to reduce the cost structure of the Company. As a result, the
Company recorded restructuring and other related charges in the three months
ended March 31, 2000 and December 31, 1999 of approximately $0.5 million and
$5.0 million, respectively. Such charges were determined in accordance with
Staff Accounting Bulletin No. 100, RESTRUCTURING AND IMPAIRMENT CHARGES, and
Emerging Issues Tax Force No. 94-3, LIABILITY RECOGNITION FOR CERTAIN EMPLOYEE
TERMINATION BENEFITS AND OTHER COSTS TO EXIT AN ACTIVITY (INCLUDING CERTAIN
COSTS INCURRED IN A RESTRUCTURING). These charges include severance costs
related to a reduction in work force, the closure and combination of certain
facilities, and the write-off of certain non-performing operating assets. The
Company expects to record additional restructuring-related charges over the next
two fiscal quarters as the Company completes its Restructuring Plan and
finalizes the consolidation and integration of its operations and related
facilities.
7
<PAGE>
MAXWELL TECHNOLOGIES, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 7 - RESTRUCTURING AND OTHER RELATED CHARGES (CONTINUED)
The following table summarizes the restructuring and other related charges
recorded by the Company in connection with the Restructuring Plan (in
thousands).
<TABLE>
<CAPTION>
THREE MONTHS ENDED
---------------------------------------------
MARCH 31, 2000 DECEMBER 31, 1999
------------------- ----------------------
<S> <C> <C>
Write-down of abandoned operating assets and impaired assets....... $226 $3,557
Severance costs for involuntary employee terminations.............. 174 756
Costs to exit certain contractual and lease obligations............ 85 590
Estimated moving costs related to consolidation of facilities...... 38 50
------------------- ----------------------
$523 $4,953
=================== ======================
</TABLE>
Of the total restructuring and other related charges, $0.5 million and $0.9
million are included in accrued liabilities at March 31, 2000 and December 31,
1999, respectively.
NOTE 8 - DISCONTINUED OPERATIONS
In November 1999, the Company adopted a plan to divest its high voltage
wound film capacitors, high voltage power supplies, time card and job cost
accounting software and glass-to-metal seals businesses. On February 29, 2000,
the Company sold the high voltage wound film capacitors and high voltage power
supplies businesses for cash of $3.5 million, approximately the book value of
the net assets sold as of that date. In addition, the buyer assumed certain
liabilities of the businesses, including a long-term lease for the facility the
businesses occupy, which extends through 2006 with annual rent of approximately
$0.5 million. In December 1999, the Company recorded certain provisions for
estimated losses on the sale of the discontinued businesses. In the three months
ended March 31, 2000, such provisions were reduced by $316,000, net of tax, to
reflect revised estimates of losses to be incurred.
Operating results of the discontinued operations are shown, net of tax,
separately in the accompanying condensed consolidated statements of operations.
The businesses included in discontinued operations had sales aggregating $4.6
million, $6.4 million and $5.8 million for the three months ended March 31,
2000, December 31, 1999 and March 31, 1999, respectively. These amounts are not
included in net sales in the accompanying condensed consolidated statements of
operations.
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
OVERVIEW
The Company applies industry-leading capabilities in power and computing to
develop and market products and services for customers in multiple industries,
including energy, satellite, defense, telecommunications, consumer electronics,
medical and bioprocessing markets.
In November 1999, the Company's Board of Directors adopted a resolution to
change the Company's fiscal year to a calendar year effective January 1, 2000.
The Company previously reported results on a fiscal year of August 1 through
July 31. During the five-month transition period August 1 to December 31, 1999,
the Company adopted a plan to restructure its operations (the "Restructuring
Plan"). This Restructuring Plan (i) consolidates certain commercial business
operations and improves their manufacturing and other operational capabilities,
(ii) focuses the defense contracting business on pulsed power systems and
computer-based analysis for government and national laboratories, (iii) focuses
the application of PUREBRIGHT technology on bioprocessing, medical and consumer
water markets, and (iv) provides for the sale of certain non-strategic business
operations.
As part of the Restructuring Plan, the Company has combined its industrial
computer business and its power quality business. The Company has also combined
three components businesses - POWERCACHE ultracapacitors, electromagnetic
interference ("EMI") filters and other ceramic capacitor products and
radiation-hardened microelectronics - into a commercial, high-reliability
electronic components group. The Company has focused its defense contracting
business on pulsed power systems and computer-based analysis for government and
national laboratories. Maxwell's PurePulse Technologies subsidiary will
concentrate on significant opportunities in the application of PUREBRIGHT
technology to pathogen inactivation in medical and bioprocessing markets and to
consumer water applications. Finally, the Company initiated the sale of its
businesses involving high voltage wound film capacitors, high voltage power
supplies, time card and job cost accounting software and glass-to-metal seals.
Results of operations for all prior fiscal periods have been restated to report
these businesses as discontinued operations. On February 29, 2000, the Company
sold the high voltage wound film capacitors and high voltage power supplies
businesses for cash of $3.5 million, approximately the book value of the net
assets sold as of that date. In addition, the buyer assumed certain liabilities
of the businesses, including a long-term lease for the facility the businesses
occupy, which extends through 2006 with annual rent of approximately $0.5
million.
The Company generates revenue from the sale of commercial products and from
performing contract research and other projects for the United States government
and other customers. From time to time, the Company also generates revenue from
licensing technology and other rights to strategic partners. Sales and marketing
for the Company's products in the United States, and for industrial computers in
Europe, are handled directly by the Company. Elsewhere, the Company utilizes
sales representatives and distributors to assist in the marketing of its
products. The Company conducts marketing programs intended to position and
promote its products and services, including trade shows, seminars, advertising,
public relations, distribution of product literature and web-sites on the
internet. The Company's ability to maintain and grow its sales depends on a
variety of factors including its ability to maintain its competitive position in
areas such as technology, performance, price, brand identity, quality,
reliability, distribution and customer service and support. The Company's sales
growth also depends on its ability to continue to introduce new products that
respond to technological change and market demand in a timely manner.
The Company's operating expenses are substantially impacted by selling,
general and administrative activities and by research and development
activities. Selling expenses are primarily driven by (1) sales volume, with
respect to sales force expenses and commission expenses; (2) the extent of
market research activities for new product design efforts; (3) advertising and
trade show activities and (4) the number of new products launched in the period.
General and administrative expenses primarily include costs associated with the
Company's administrative employees, facilities and functions. The Company incurs
expenses in foreign countries primarily in the functional currencies of such
locations. As a result of the Company's international operations, the United
States dollar amount of its revenue and expenses is impacted by changes in
foreign currency exchange rates.
9
<PAGE>
BUSINESS SEGMENTS
In accordance with the requirements and guidelines of Statement of
Financial Accounting Standards No. 131, DISCLOSURE ABOUT SEGMENTS OF AN
ENTERPRISE AND RELATED INFORMATION ("Statement No. 131"), Maxwell's operations
have been classified into business segments. In connection with the Company's
Restructuring Plan, the Company has integrated its businesses into new operating
divisions. Accordingly, the Company has defined four new reporting segments as
follows (prior period segment information has been restated to conform to the
new segmentation):
- - POWER AND COMPUTING SYSTEMS
As part of its Restructuring Plan, the Company is integrating its
I-Bus, Inc. and Phoenix Power Systems, Inc. subsidiaries
("I-Bus/Phoenix"). The new I-Bus/Phoenix operation expands the
industrial computer product line of I-Bus, Inc. with complementary
power quality products and broadens the global reach of the power
quality products. As part of the Restructuring Plan, the Company is
combining the San Diego operations of these two subsidiaries into a
single facility in San Diego. The new San Diego facility is being
designed for highly-efficient manufacturing, with improved processes,
improved personnel training and more disciplined cost control
practices.
The Company designs, manufactures and supplies standard, custom and
semi-custom industrial computer modules, platforms and fully-integrated
systems to original equipment manufacturers ("OEMs"), on a worldwide
basis. The I-Bus/Phoenix industrial computer product line ranges from
enclosures, CPU boards and backplanes to fully integrated and highly
customized computer systems. This product line primarily employs
passive backplane architecture, complemented by a newly-introduced
CompactPCI line of products.
The I-Bus/Phoenix power quality products consist of power distribution
units, power conditioners and inverters, uninterruptible power supplies
("UPS") and other power protection products. These products are
designed and engineered by the Company for customer applications
primarily in the medical and telecommunications markets.
- - ELECTRONIC COMPONENTS
The Restructuring Plan organizes a high-reliability electronic
components group (the "Electronic Components Group") within the Company
by combining its POWERCACHE ultracapacitor business, its Sierra-KD EMI
filter and ceramic capacitor business and its Space Electronics, Inc.
("SEi") high-reliability and radiation-hardened microelectronics
business. These businesses each design and manufacture high-reliability
electronic components based on the Company's core competencies in power
and computing. During the current fiscal year, the Company will
integrate the POWERCACHE ultracapacitor business and the
microelectronic components business into one manufacturing site in San
Diego, while the EMI filters and ceramic capacitors will continue to be
manufactured at the Company's facility in Carson City, Nevada. Both
facilities are being designed for highly-efficient manufacturing, with
improved processes, improved personnel training and more disciplined
cost control practices.
The Electronic Components Group is developing the POWERCACHE
ultracapacitor to provide bursts of power when a rapid injection of
energy is required for an application. The POWERCACHE ultracapacitor is
scaleable, in that it can be manufactured in a broad range of shapes
and sizes. Currently, the Company is developing ultracapacitors from
sub-matchbook size to cells measuring 2" x 2" x 6", while maintaining
the same high energy storage per unit volume. POWERCACHE
ultracapacitors can also be linked together in modules to supply higher
power for applications such as automotive and power supply systems.
10
<PAGE>
Through its Sierra-KD unit, the Electronic Components Group designs,
manufactures and sells a line of ceramic capacitor filters to absorb
the electromagnetic fields and signals generated by electronic devices
which interfere with and disrupt the functioning of other electronic
devices, including implantable medical devices such as pacemakers and
defibrillators, and aerospace guidance and communications systems.
These products block EMI from entering an electronic device at the
opening used by, for example, power leads or sensors.
Through its SEi unit, the Electronic Components Group designs and
manufactures high reliability, radiation hardened microelectronic
components and assemblies primarily for the space market, including
integrated circuits and multi-chip modules designed and adapted for
space flight and other high reliability applications. In the space
market, SEi products are used in satellites which experience extreme
environmental conditions, often in radiation-intense orbits.
- - GOVERNMENT SYSTEMS
Through its Systems Division, Maxwell is engaged in a variety of
research and development programs in pulsed power, pulsed power systems
design and construction, and weapons effects simulation. These services
are primarily supplied to the United States government and its agencies
including the Air Force and the Defense Threat Reduction Agency. The
Systems Division also provides systems and services to national
laboratories and industrial and defense companies. The Systems Division
typically performs research and development under contracts that allow
the Company to apply developed technology in commercial markets.
- - STERILIZATION AND PURIFICATION SYSTEMS
The Company's PurePulse Technologies, Inc. subsidiary ("PurePulse")
applies PUREBRIGHT intense broad spectrum pulsed light technology to
kill viruses and other microorganisms in water, blood plasma and other
biopharmaceutical and medical products, and on medical product
packaging material.
As part of the Restructuring Plan, PurePulse will pursue PUREBRIGHT
applications in the medical, biopharmaceutical and consumer water
markets. Other PUREBRIGHT applications involving food and food
packaging, industrial water applications and niche markets in medical
packaging, as well as applications involving the COOLPURE-Registered
Trademark pulsed electric field technology, will be de-emphasized and
possibly sold or licensed. Maxwell intends to seek equity financing
directly into PurePulse to finance its product development activities
and operations.
RESULTS OF OPERATIONS
The following discussion provides a comparison of current results of
operations both to the comparable prior year three months ended March 31, 1999
and to the sequentially prior three months ended December 31, 1999. It is
management's opinion that comparing current results to the December period is
more meaningful than a comparison to the first quarter of 1999, due to the
effects of the Company's Restructuring Plan and reduced revenue and profit
contributions from licensing and strategic transactions compared to the prior
year.
11
<PAGE>
The following table sets forth, for the periods indicated selected
operating data for the Company, expressed as a percentage of sales:
<TABLE>
<CAPTION>
THREE MONTHS ENDED
-------------------------------------------------------
MARCH 31, DECEMBER 31, MARCH 31,
2000 1999 1999
---------------- ---------------- -------------
<S> <C> <C> <C>
Sales..................................................... 100.0% 100.0% 100.0%
Cost of sales............................................. 76.0 82.3 65.2
---------------- ---------------- -------------
Gross profit.............................................. 24.0 17.7 34.8
Operating expenses:
Selling, general and administrative.................... 25.0 34.4 21.3
Research and development............................... 4.5 7.3 5.1
Restructuring, acquisition and other charges........... 1.5 15.8 4.0
---------------- ---------------- -------------
Total operating expenses............................... 31.0 57.5 30.4
---------------- ---------------- -------------
Operating income (loss)................................... (7.0) (39.8) 4.4
Interest expense.......................................... (0.2) (0.3) (0.2)
Interest income and other, net............................ 0.1 0.2 1.0
---------------- ---------------- -------------
Income (loss) before income taxes and minority interest... (7.1) (39.9) 5.2
Provision (credit) for income taxes....................... (2.8) (16.3) 0.5
Minority interest in net income (loss) of subsidiaries.... (0.3) (1.3) 0.2
---------------- ---------------- -------------
Income (loss) from continuing operations.................. (4.0) (22.3) 4.5
Income (loss) from discontinued operations................ (0.1) (13.9) 0.7
---------------- ---------------- -------------
Net income (loss)......................................... (4.1)% (36.2)% 5.2%
================ ================ =============
</TABLE>
The following table sets forth sales, gross profit and gross profit as a
percentage of sales for each of the Company's business segments for the three
months ended March 31, 2000, December 31, 1999 and March 31, 1999:
<TABLE>
<CAPTION>
THREE MONTHS ENDED
-------------------------------------------------------
MARCH 31, DECEMBER 31, MARCH 31,
2000 1999 1999
---------------- ---------------- --------------
(IN THOUSANDS)
<S> <C> <C> <C>
Power and Computing Systems:
Sales................................................... $17,486 $15,311 $16,138
Gross profit............................................ 5,125 4,439 5,003
Gross profit as a percentage of sales................... 29.3% 29.0% 31.0%
Electronic Components:
Sales................................................... $7,332 $5,304 $7,620
Gross profit (loss)..................................... 1,560 (104) 2,834
Gross profit as a percentage of sales................... 21.3% n/a 37.2%
Government Systems:
Sales................................................... $10,755 $10,372 $10,828
Gross profit............................................ 2,172 2,197 3,670
Gross profit as a percentage of sales................... 20.2% 21.2% 33.9%
Sterilization and Purification Systems:
Sales................................................... $356 $422 $2,235
Gross profit (loss)..................................... (238) (984) 1,292
Gross profit (loss) as a percentage of sales............ n/a n/a 57.8%
Consolidated
Sales................................................... $35,929 $31,409 $36,821
Gross profit............................................ 8,619 5,548 12,799
Gross profit as a percentage of sales................... 24.0% 17.7% 34.8%
</TABLE>
12
<PAGE>
SALES
Sales for the three months ended March 31, 2000 were $35.9 million, a 2.4%
decrease from $36.8 million for the same period last year. The prior year period
included revenue of $2.2 million from sales of licenses and other collaborative
agreements, while there was no such revenue in the current quarter. Excluding
such revenue, sales of products and services increased by 3.7% to $35.9 million
in the three months ended March 31, 2000 from $34.6 million in the comparable
prior year period. In addition, total sales in the current quarter increased by
14.4% sequentially from total sales of $31.4 million in the three months ended
December 31, 1999. Sales in each of the Company's business segments are
discussed below.
POWER AND COMPUTING SYSTEMS. In the three months ended March 31, 2000,
sales in the Power and Computing Systems segment increased $1.4 million, or
8.4%, to $17.5 million from $16.1 million in the three months ended March 31,
1999. The increase in sales for the quarter is primarily attributable to
increases in sales of power protection and delivery systems over the prior year.
Current period sales in the Power and Computing Systems segment also increased
14.2% sequentially over sales of $15.3 million in the three months ended
December 31, 1999.
ELECTRONIC COMPONENTS. In the three months ended March 31, 2000, sales in
the Electronic Components segment decreased $0.3 million, or 3.8%, to $7.3
million from $7.6 million in the three months ended March 31, 1999. This
decrease primarily resulted from decreases of $0.5 million in revenue received
from technology licenses and other collaborative agreements. On a sequential
basis, sales in the Electronic Components segment increased 38.2% from sales of
$5.3 million in the three months ended December 31, 1999.
Each business unit within the segment contributed to this increase.
GOVERNMENT SYSTEMS. In the three months ended March 31, 2000, sales in the
Government Systems segment remained level at $10.8 million compared to the three
months ended March 31, 1999 and increased 3.7% sequentially from sales of $10.4
million in the three months ended December 31, 1999.
STERILIZATION AND PURIFICATION SYSTEMS. In the three months ended March 31,
2000, sales in the Sterilization and Purification Systems segment decreased $1.9
million, or 84%, to $0.3 million from $2.2 million in the first quarter of last
fiscal year. During the three months ended March 31, 1999, revenues in this
business segment included $1.7 million from licensing and rights fees received
from strategic partners. The revenues in the first quarter of the current fiscal
year do not include any such licensing and rights fees. The Company is
redefining its product strategy and market focus and, as a result, revenue
contribution from license fees will not continue at historical levels.
GROSS PROFIT
In the three months ended March 31, 2000, the Company's gross profit was
$8.6 million, or 24.0% of sales, compared to $12.8 million, or 34.8% of sales,
in the three months ended March 31, 1999. The March 1999 period benefited from
high gross margins associated with the licensing and technology collaborations
discussed above. On a sequential basis, gross profit increased $3.1 million, or
55.4%, to $8.6 million, or 24% of sales, from $5.5 million, or 17.7% of sales,
in the three months ended December 31, 1999. The sequential improvement is due
partly to increased sales volumes and improvements in the cost structure of
certain products, partially offset by certain costs incurred in the three months
ended March 31, 2000 related to training personnel in improved manufacturing
processes. In addition, gross profit in the December period was negatively
impacted by certain write-offs of inventories determined to be excess or
obsolete. Gross profit by business segment is discussed below.
POWER AND COMPUTING SYSTEMS. In the three months ended March 31, 2000,
gross profit generated by the Power and Computing Systems segment increased by
$0.1 million, or 2.4%, to $5.1 million from $5.0 million in the three months
ended March 31, 1999, but decreased as a percentage of sales to 29.3% in the
current period as compared to 31.0% in the prior year period. The decrease in
gross profit percentage is partly due to product mix and costs incurred in the
current quarter in connection with training personnel in improved manufacturing
processes. On a sequential basis, gross profit as a percentage of sales
increased from 29.0% in the three months ended December 31, 1999 to 29.3% in the
current period.
13
<PAGE>
ELECTRONIC COMPONENTS. In the three months ended March 31, 2000, gross
profit in the Electronic Components segment decreased by $1.2 million, or 45.0%,
to $1.6 million from $2.8 million in the three months ended March 31, 1999. As a
percentage of sales, gross profit declined to 21.3% in this year's first quarter
from 37.2% in the three months ended March 31, 1999. The decrease in gross
profit as a percentage of sales reflects the impact of having no current
contribution from high-margin technology licenses and other collaborative
agreements. In addition, the prior year first quarter benefited from high gross
margins on a government contract in the segment's commercial satellite business,
which was completed during the prior year. Furthermore, in its POWERCACHE
ultracapacitor product line, the Company is making required infrastructure and
other investments which impact gross profit at current sales volumes. Gross
margins will continue to be impacted until full production volumes are reached
and maintained. On a sequential basis, gross margins in the Electronic
Components segment improved significantly from a gross margin loss of $0.1
million in the three months ended December 31, 1999. The sequential improvement
is due partly to increased sales volumes and improvements in the cost structure
of certain products, partially offset by certain costs incurred in the three
months ended March 31, 2000 related to training personnel in improved
manufacturing processes. In addition, the December period was negatively
impacted by certain write-offs of inventories deemed excess or obsolete.
GOVERNMENT SYSTEMS. In the three months ended March 31, 2000, gross profit
in the Government Systems segment decreased $1.5 million, or 40.8%, to $2.2
million from $3.7 million in the three months ended March 31, 1999. As a
percentage of sales, gross profit decreased to 20.2% in this year's first
quarter from 33.9% in the three-month period ended March 31, 1999. For the three
months ended December 31, 1999, gross margins in this segment were 21.2%. The
gross margins in the prior year March period were higher than normal for this
segment and the Company expects future gross margins to remain near the levels
achieved in the current period.
STERILIZATION AND PURIFICATION PRODUCTS. In the three months ended March
31, 2000, gross profit in the Sterilization and Purification Products segment
decreased $1.5 million, or 118%, to a loss of $0.2 million from a profit of $1.3
million in the three months ended March 31, 1999. Gross profit in the three
months ended March 31, 1999 benefited from high-margin revenue from grants of
licenses and rights. As the Company redefines its product strategy and market
focus, gross profit margins will likely continue to be negatively impacted.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
In the three months ended March 31, 2000, the Company's selling, general
and administrative expenses increased $1.2 million, or 15.0%, to $9.0 million
from $7.8 million in the three months ended March 31, 1999. As a percentage of
total sales, selling, general and administrative expenses increased to 25.0% in
this year's first quarter from 21.3% in the three months ended March 31, 1999,
but decreased $1.8 million, or 16.7%, from $10.8 million, or 34.4% of sales, in
the three months ended December 31, 1999. As part of its Restructuring Plan, the
Company is continuing to focus on opportunities to decrease its expenses in this
area.
RESEARCH AND DEVELOPMENT EXPENSES
The Company's research and development expenses reflect internally funded
research and development programs. Costs associated with United States
Government and other customer funded research and development contracts are
included in cost of sales. The level of internally funded research and
development expenses is affected from time to time by the Company's ability to
obtain customer or grant funding to support a portion of its research and
product development activities. Internally funded research and development
expenses were $1.6 million and $1.9 million for the three months ended March 31,
2000 and 1999, respectively. The Company expects its level of spending in
research and development to increase in future periods to accelerate new product
introductions.
14
<PAGE>
RESTRUCTURING, ACQUISITION AND OTHER CHARGES
In connection with the Restructuring Plan, the Company has undertaken
various actions to improve the cost structure of the Company. As a result, the
Company recorded restructuring and other related charges in the three months
ended March 31, 2000 and December 31, 1999 of $0.5 million and $5.0 million,
respectively. These charges primarily include severance costs related to a
reduction in work force, the closure and combination of certain facilities and
the write-off of non-performing operating assets. The Company expects to record
additional restructuring-related charges over the next two fiscal quarters as
the Company completes its Restructuring Plan and finalizes the consolidation and
integration of its operations and related facilities.
In the three months ended March 31, 1999, the Company recorded
approximately $1.5 million of direct acquisition costs for business combinations
completed during that quarter, which were accounted for using the
pooling-of-interests method.
INTEREST EXPENSE
Interest expense was $74,000 and $66,000, respectively, in the three months
ended March 31, 2000 and 1999. At March 31, 2000, the Company had $5.0 million
outstanding under its bank line-of-credit. The Company expects borrowings, and
related interest expense, to increase as the Company completes its Restructuring
Plan.
INTEREST INCOME AND OTHER, NET
Interest income and other, net, consisting primarily of interest income,
was $45,000 and $388,000 in the three months ended March 31, 2000 and 1999,
respectively. The decrease in interest income reflects lower average cash
balances in the current period.
PROVISION (CREDIT) FOR INCOME TAXES
The provision (credit) for income taxes in the current quarter reflects the
Company's expected world-wide tax rate for the current fiscal year, while in the
prior year's first quarter, the Company's provision for income taxes consisted
primarily of taxes related to its foreign operations.
MINORITY INTEREST IN NET INCOME (LOSS) OF SUBSIDIARIES
Minority interest in net income (loss) of subsidiaries was $(107,000) in
the three months ended March 31, 2000 and $83,000 in the three months ended
March 31, 1999. The current period loss results from losses incurred by the
Company's minority owned subsidiaries.
INCOME (LOSS) FROM CONTINUING OPERATIONS
As a result of the factors mentioned above, the income (loss) from
continuing operations was $(1.4) million for the three month period ended March
31, 2000, compared to $(7.0) million for the three months ended December 31,
1999, and $1.7 million for the three month period ended March 31, 1999.
15
<PAGE>
DISCONTINUED OPERATIONS
In November 1999, the Company adopted a plan to divest its high voltage
wound film capacitors, high voltage power supplies, time card and job cost
accounting software and glass-to-metal seals businesses. On February 29, 2000,
the Company sold the high voltage wound film capacitors and high voltage power
supplies businesses for cash of $3.5 million, approximately the book value of
the net assets sold as of that date. In addition, the buyer assumed certain
liabilities of the businesses, including a long-term lease for the facility the
businesses occupy, which extends through 2006 with annual rent of approximately
$0.5 million. In December 1999, the Company recorded certain provisions for
estimated losses on the sale of the discontinued businesses. In the three months
ended March 31, 2000, such provisions were reduced by $316,000, net of tax, to
reflect revised estimates of losses to be incurred. Total income (loss) from
discontinued operations was $(63,000) in the three months ended March 31, 2000,
compared to $(4.4) million for the three months ended December 31, 1999 and $0.3
million for the three months ended March 31, 1999.
LIQUIDITY AND CAPITAL RESOURCES
The Company has historically relied on a combination of internally
generated funds and bank borrowings to finance its working capital requirements
and capital expenditures. In addition, in each of the two most recent full
fiscal years, the Company received approximately $2.3 million from the exercise
of stock options and purchases under employee stock purchase plans.
Cash used by operating activities in the three months ended March 31, 2000
was approximately $5.4 million as compared to $4.7 million in the three months
ended March 31, 1999. In the current period, the use of cash was primarily
attributable to operating losses and increases in accounts receivable. The
Company's capital expenditures in the three months ended March 31, 2000 and 1999
were $1.4 million and $1.9 million, respectively, and related primarily to
production and other capital assets needed to support growth in all of the
Company's business units. The Company has ordered additional equipment for
volume manufacturing of ultracapacitors and for manufacture of EMI filter
capacitors. In addition, the Company will incur expenditures in connection with
the design and construction of the new facilities for its newly-integrated
commercial divisions. The Company may also consider leasing facilities or
manufacturing equipment or both or may satisfy high-volume manufacturing
requirements through outsourcing or under licensing arrangements with third
parties. If the Company decides to internally finance construction of additional
facilities, a significant amount of capital may be required. The Company will
also incur cash expenditures in the current fiscal year in connection with
completing its Restructuring Plan.
The Company believes that funds on-hand, together with cash generated from
operations, cash expected to be received from the divestiture of certain
businesses and funds available under its bank line-of-credit, will be sufficient
to finance its Restructuring Plan, its operations and its capital expenditures
through the current fiscal year. In addition to addressing manufacturing
requirements, the Company may also from time-to-time consider acquisitions of
complementary businesses, products or technologies, which may require additional
funding. Sources of additional funding for these purposes could include one or
more of the following: cash and cash equivalents; cash flow from operations;
borrowings under the existing bank line-of-credit; investments by strategic
partners and additional debt or equity financings. There can be no assurance
that the Company will be able to obtain additional sources of financing on
favorable terms, if at all, at such time or times as the Company may require
such capital.
Maxwell has a bank line-of-credit of $20 million, under which the Company
had borrowings of $5.0 million outstanding as of March 31, 2000.
INFLATION AND CHANGES IN PRICES
Generally, the Company has been able to increase prices to offset its
inflation-related increased costs in its commercial businesses. A substantial
portion of the Company's business with agencies of the United States government
consists of cost-reimbursement contracts, which permit recovery of inflation
costs. Fixed-price contracts with government and other customers typically
include estimated costs for inflation in the contract price.
16
<PAGE>
SOFTWARE COMPATIBILITY WITH YEAR 2000 DATE PROCESSING
In prior reports, the Company discussed the nature and progress of its
plans to become Year 2000 ready. In late 1999, the Company completed its Year
2000 Information Systems Compliance Program, including the remediation and
testing of its systems and the development of a contingency plan. As a result of
those planning and implementation efforts, the Company experienced no
significant disruptions in mission critical information technology and
non-information technology systems and believes that those systems successfully
responded to the Year 2000 date change. The Company incurred total costs of
approximately $1.5 million through 1999 in connection with its Year 2000
Information Systems Compliance Program. The Company is not aware of any material
problems resulting from Year 2000 issues, either with its products, its internal
systems, or the products and services of third parties. The Company will
continue to monitor its mission critical computer applications and those of its
suppliers and vendors throughout the year 2000 to ensure that any latent Year
2000 matters that may arise are promptly addressed.
FORWARD-LOOKING STATEMENTS
To the extent that the above discussion goes beyond historical information
and indicates results or developments which the Company plans or expects to
achieve, these forward-looking statements are identified by the use of terms
such as "expected," "anticipates," "believes," "plans" and the like. Readers are
cautioned that such future results are uncertain and could be affected by a
variety of factors that could cause actual results to differ from those
expected, and such differences could be material. The Company undertakes no
obligation to publicly release the result of any revisions to these
forward-looking statements that may be made to reflect any future events or
circumstances. Readers are referred to item 1 of the Company's Annual Report on
Form 10-K for the transition period from August 1 to December 31, 1999 for a
discussion of certain of those factors.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company has not entered into or invested in any instruments that are
subject to market risk.
The Company's bank line-of-credit agreement bears interest at a rate that
varies based on the LIBOR or the bank's prime rate. As of March 31, 2000, the
Company has approximately $5.0 million outstanding under its bank
line-of-credit.
17
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Registrant's 1999 Annual Meeting of Shareholders was held on January
28, 2000. At the meeting, Kenneth F. Potashner was elected as a Class I director
for a term expiring at the 2002 Annual Meeting of Shareholders. Directors Carl
Eibl, Mark Rossi, Jean Lavigne and Robert Guyett continue to serve as directors
with terms expiring at the 2000 and 2001 Annual Meetings of Shareholders.
In addition, the Registrant's shareholders approved an amendment to the
Company's 1995 Stock Option Plan, increasing the number of shares reserved for
options thereunder by 400,000 shares; approved the Company's 1999 Director Stock
Option Plan and authorized 75,000 shares for options thereunder; and, approved
the Company's 1999 Management Equity Ownership Program.
The following numbers of votes were cast "for" and to "withhold authority
to vote for" the election of Kenneth F. Potashner, elected as Class I director
at the meeting:
For: 7,584,450 Withhold Authority: 898,731
The vote on the approval of the amendment to the Company's 1995 Stock
Option Plan was as follows:
For: 7,305,325 Against: 1,023,201 Abstain: 154,655
The vote on the approval of the Company's 1999 Director Stock Option Plan
was as follows:
For: 7,260,146 Against: 1,058,980 Abstain: 164,055
The vote on the approval of the Company's 1999 Management Equity Ownership
Program was as follows:
For: 7,583,360 Against: 561,214 Abstain: 145,001
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
27 - Financial Data Schedule
(b) Reports on Form 8-K
None.
18
<PAGE>
SIGNATURE
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 thereunto duly authorized.
MAXWELL TECHNOLOGIES, INC.
May 12, 2000 /s/ Carlton J. Eibl
- ------------------------------- -----------------------------------------
Date Carlton J. Eibl, President and
Chief Executive Officer
May 12, 2000 /s/ Vickie L. Capps
- ------------------------------- -----------------------------------------
Date Vickie L. Capps, Vice President -
Finance, Treasurer and Chief Financial
Officer (Principal Financial and
Accounting Officer)
19
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 3,603
<SECURITIES> 0
<RECEIVABLES> 36,860
<ALLOWANCES> (1,258)
<INVENTORY> 23,404
<CURRENT-ASSETS> 82,138
<PP&E> 54,396
<DEPRECIATION> (35,363)
<TOTAL-ASSETS> 114,581
<CURRENT-LIABILITIES> 29,457
<BONDS> 178
0
0
<COMMON> 969
<OTHER-SE> 82,199
<TOTAL-LIABILITY-AND-EQUITY> 114,581
<SALES> 35,929
<TOTAL-REVENUES> 35,929
<CGS> 27,310
<TOTAL-COSTS> 27,310
<OTHER-EXPENSES> 11,148
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 74
<INCOME-PRETAX> (2,558)
<INCOME-TAX> (1,023)
<INCOME-CONTINUING> (1,428)
<DISCONTINUED> (63)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,491)
<EPS-BASIC> (0.15)
<EPS-DILUTED> (0.15)
</TABLE>
