<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934.
For the quarterly period 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 0-21221
MICROVISION, INC.
(Exact Name of Registrant as Specified in Its Charter)
WASHINGTON 91-1600822
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
19910 North Creek Parkway, Bothell, Washington 98011-3008
(Address of Principal Executive Offices)
Issuer's telephone number, including area code: (425) 415-6847
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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. [X] Yes [ ] No
As of May 2, 2000, 11,588,575 shares of the Company's common stock, no par
value, were outstanding.
1
<PAGE>
PART I
FINANCIAL INFORMATION
PAGE
Item 1 - Financial Statements
Balance Sheet at March 31, 2000 and December 31, 1999 3
Statement of Operations for the three months ended 4
March 31, 2000 and 1999
Statement of Cash Flows for the three months ended 5
March 31, 2000 and 1999
Statement of Comprehensive Loss for the three months 7
months ended March 31, 2000 and 1999
Notes to Financial Statements 8
Item 2 - Management's Discussion and Analysis of Financial Condition 9
and Results of Operations
Item 3 - Quantitative and Qualitative Disclosures About Market Risk 15
PART II
OTHER INFORMATION
Item 1 - Legal Proceedings 16
Item 2 - Changes in Securities and Use of Proceeds 16
Item 3 - Defaults Upon Senior Securities 16
Item 4 - Submission of Matters to a Vote of Security Holders 16
Item 5 - Other Information 16
Item 6 - Exhibits and Reports on Form 8-K 16
2
<PAGE>
MICROVISION, INC.
BALANCE SHEET
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
------------ ------------
(unaudited)
<S> <C> <C>
ASSETS
Current Assets
Cash and cash equivalents $ 3,730,200 $ 2,798,000
Investment securities available-for-sale 26,715,200 29,369,400
Accounts receivable, net 1,720,600 1,024,500
Costs and estimated earnings in excess of
billings on uncompleted contracts 1,021,800 2,000,400
Restricted cash -- 650,000
Other current assets 780,500 847,700
------------ ------------
Total current assets 33,968,300 36,690,000
Long-term investment, at cost 623,600 623,600
Property and equipment, net 3,192,300 3,054,700
Restricted cash 1,000,000 1,100,000
Other assets 124,600 150,700
------------ ------------
Total assets $ 38,908,800 $ 41,619,000
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable $ 942,700 $ 1,453,100
Accrued liabilities 1,959,000 2,000,100
Billings in excess of costs and estimated
earnings on uncompleted contracts 202,000 167,000
Current portion of capital lease obligations 236,100 220,800
Current portion of long-term debt 48,100 46,900
------------ ------------
Total current liabilities 3,387,900 3,887,900
Capital lease obligations, net of current portion 245,700 279,400
Long-term debt, net of current portion 329,000 341,500
Deferred rent, net of current portion 229,800 214,800
------------ ------------
Total liabilities 4,192,400 4,723,600
------------ ------------
Commitments and contingencies -- --
Mandatorily redeemable convertible preferred stock -- 1,536,000
------------ ------------
Shareholders' Equity
Common stock 80,208,100 75,518,300
Deferred compensation (241,600) (213,100)
Subscriptions receivable from related parties (577,200) (349,100)
Accumulated other comprehensive loss (63,600) (60,600)
Accumulated deficit (44,609,300) (39,536,100)
------------ ------------
Total shareholders' equity 34,716,400 35,359,400
------------ ------------
Total liabilities and shareholders' equity $ 38,908,800 $ 41,619,000
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
MICROVISION, INC.
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Three Months Ended March 31,
----------------------------
2000 1999
------------ ------------
(unaudited)
<S> <C> <C>
Contract revenue $ 2,109,500 $ 2,301,600
Cost of revenue 1,467,500 1,709,600
------------ ------------
Gross margin 642,000 592,000
------------ ------------
Research and development
expense 3,599,400 881,800
Marketing, general and
administrative expense 2,490,900 1,721,700
------------ ------------
Total expenses 6,090,300 2,603,500
------------ ------------
Loss from operations (5,448,300) (2,011,500)
Interest income 451,900 46,400
Interest expense (76,800) (36,900)
------------ ------------
Net loss (5,073,200) (2,002,000)
Less: Non-cash beneficial conversion
feature of Series B Preferred Stock -- (1,148,000)
------------ ------------
Net loss available for common
shareholders $ (5,073,200) $ (3,150,000)
============ ============
Net loss per share available for common
shareholders - basic and diluted $ (0.48) $ (0.51)
============ ============
Weighted-average shares outstanding -
basic and diluted 10,469,200 6,119,000
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
MICROVISION, INC.
STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
Three Months Ended March 31,
2000 1999
----------- -----------
(unaudited)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(5,073,200) $(2,002,000)
Adjustments to net cash used in operations:
Depreciation 241,000 125,400
Non-cash expenses related to issuance of stock,
warrants and options and deferred compensation 153,800 82,200
Non-cash deferred rent 15,000 --
Allowance for estimated contract losses -- 132,000
Changes in:
Accounts receivable (696,100) 1,250,200
Costs and estimated earnings in excess of billings
on uncompleted contracts 978,600 (376,400)
Restricted cash 650,000 --
Other current assets 67,200 (87,500)
Other assets 126,100 (1,051,900)
Accounts payable (510,400) (339,500)
Accrued liabilities 335,900 8,900
Billings in excess of costs and estimated earnings
on uncompleted contracts 35,000 (256,400)
----------- -----------
Net cash used in operating activities (3,677,100) (2,515,000)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Sales of investment securities 7,999,400 4,715,000
Purchases of investment securities (5,348,200) (5,215,000)
Purchases of property and equipment (345,900) (551,700)
----------- -----------
Net cash provided by (used in) investing activities 2,305,300 (1,051,700)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments under capital leases (51,100) (31,900)
Principal payments under long term debt (11,300) --
Payments received on subscriptions receivable 56,500 --
Net proceeds from issuance of common stock 2,309,900 506,100
Net proceeds from issuance of preferred stock -- 4,770,000
----------- -----------
Net cash provided by financing activities 2,304,000 5,244,200
----------- -----------
Net increase in cash and cash equivalents 932,200 1,677,500
Cash and cash equivalents at beginning of period 2,798,000 2,269,000
----------- -----------
Cash and cash equivalents at end of period $ 3,730,200 $ 3,946,500
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
MICROVISION, INC.
STATEMENT OF CASH FLOWS (CONTINUED)
<TABLE>
<CAPTION>
Three Months Ended March 31,
2000 1999
----------- -----------
(unaudited)
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
<S> <C> <C>
Cash paid for interest $ 76,800 $ 36,900
=========== ==========
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
Property and equipment acquired under capital leases $ 32,700 $ --
=========== ==========
Beneficial conversion feature of Series B Preferred Stock $ -- $1,148,000
=========== ==========
Conversion of preferred stock to common stock $ 1,536,000 $ --
=========== ==========
Issuance of common stock under license agreement $ 377,000 $ --
=========== ==========
Exercise of stock options for subscriptions receivable $ 284,600 $ 165,600
=========== ==========
Deferred compensation for stock grants $ 182,300 $ 9,200
=========== ==========
Unrealized gain (loss) in investment securities available-for-sale $ (3,000) $ 7,000
=========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
MICROVISION, INC.
STATEMENT OF COMPREHENSIVE LOSS
<TABLE>
<CAPTION>
Three Months Ended March 31,
---------------------------
2000 1999
---- ----
(unaudited)
<S> <C> <C>
Net loss $(5,073,200) $(2,002,000)
Other comprehensive income:
Unrealized (loss) gain on investment
securities available-for-sale (3,000) 7,000
----------- -----------
Comprehensive loss $(5,076,200) $(1,995,000)
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
MICROVISION, INC.
Notes to Financial Statements
March 31, 2000
Management's Statement
The Balance Sheet as of March 31, 2000 and Statements of Operations, of Cash
Flows and of Comprehensive Income and Loss for the three-month periods ended
March 31, 2000 and March 31, 1999 have been prepared by Microvision, Inc. (the
Company) and have not been audited. In the opinion of management, all
adjustments (consisting only of normal recurring adjustments) necessary to
present fairly the financial position, results of operations and cash flows
at March 31, 2000 and all periods presented, have been made. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. You should read these condensed
financial statements in conjunction with the financial statements and notes
thereto included in the Company's Annual Report on Form 10-K for the fiscal
year ended December 31,1999. The results of operations for the period ended
March 31, 2000 are not necessarily indicative of the operating results that
may be attained for the entire fiscal year.
Net Loss Per Share
Basic net loss per share is calculated on the basis of the weighted-average
number of common shares outstanding during the periods. Net loss per share
assuming dilution is calculated on the basis of the weighted-average number
of common shares outstanding and the dilutive effect of all potential common
stock equivalents and convertible securities. Net loss per share assuming
dilution for the periods ended March 31, 2000 and March 31, 1999 is equal to
basic net loss per share since the effect of common stock equivalents
outstanding during the periods, including convertible preferred stock,
options and warrants computed using the treasury stock method, is
anti-dilutive.
The components of basic and diluted earnings per share were as follows:
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
2000 1999
<S> <C> <C>
Numerator:
Net loss available for common shareholders $ (5,073,200) $(3,150,000)
Denominator:
Basic and diluted weighted-average common
shares outstanding 10,469,200 6,119,000
------------ -----------
Basic and diluted net loss per share $ (.48) $ (.51)
=========== ===========
</TABLE>
Shareholders' Equity
In March 2000, the Company redeemed 1,600 shares of Series B-2 mandatorily
redeemable convertible preferred stock and issued 100,000 shares of common stock
to the holder thereof.
Subsequent Events
In March 2000, the Company received a commitment from Cree, Inc. and General
Electric Pension Trust to purchase an aggregate of 500,000 shares of common
stock for $25.0 million. The sale was completed and the shares were issued in
April, 2000.
In April 2000, a private investor exercised a warrant to purchase 418,848 shares
of common stock at a price of $17.91. Total proceeds from the sale were $7.5
million.
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Forward-Looking Statements
The information set forth in this report in Item 2 "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and Item 3
"Quantitative and Qualitative Disclosure about Market Risk" includes
"forward-looking statements" within the meaning of Section 21E of the Securities
Exchange Act for 1934, as amended (the "Exchange Act"), and is subject to the
safe harbor created by that section. Such statements may include, but are not
limited to, projections of revenues, income, or loss, capital expenditures,
plans for product development and cooperative arrangements, future operations,
financing needs or plans of the Company, as well as assumptions relating to the
foregoing. The words "believe," "expect," "anticipate," "estimate," "project,"
and similar expressions identify forward-looking statements, which speak only as
of the date the statement was made. Certain factors that realistically could
cause results to differ materially from those projected in the forward-looking
statements are set forth in Item 1 "Description of Business-Considerations
Related to the Company's Business" in the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 1999.
Overview
The Company began operations in May 1993 to develop and commercialize
technology for displaying images and information onto the retina of the eye.
Retinal Scanning Display technology creates a high resolution, full motion
image by scanning a low power beam of colored light to "paint" rows of pixels
on the viewer's eye. In certain applications, the image appears in the
viewer's field of vision as if the viewer were only an arm's length away from
a high quality video screen. The Retinal Scanning Display technology can also
be used to superimpose an image on the viewer's field of vision, enabling the
viewer to see data or images in the context of his or her natural
surroundings. In each case, a high resolution, bright image is created.
In 1993, the Company acquired an exclusive license to the Virtual Retinal
Display, a specific type of Retinal Scanning Display, from the University of
Washington and entered into a research agreement with the University of
Washington to further develop the Virtual Retinal Display technology. Since
completing its initial public offering in August 1996, the Company has
established and equipped an in-house laboratory and transferred the research and
development relating to the Virtual Retinal Display from the University of
Washington to its in-house laboratory. The Company has continued to develop the
Virtual Retinal Display technology as part of its broader research and
development efforts relating to the Retinal Scanning Display technology.
9
<PAGE>
The Company currently has several prototype versions of the Retinal Scanning
Displays, including monochromatic and color portable units and a full color
tabletop model. The Company expects to continue funding prototype and
demonstration versions of products incorporating its technology through at least
2000.
In conjunction with developing the Retinal Scanning Display technology the
Company is developing components that can be integrated into different product
offerings. The Company has currently defined the following key product offerings
for further development:
- - High Performance - High fidelity displays for use in general simulation
avionics, medical and entertainment applications.
- - Compact Products - Lightweight, see-through, wearable systems for hands
free applications in the industrial, medical, and
defense markets.
- - Microdisplay - Highly miniaturized display systems to be incorporated
in OEM products including cellular telephones, personal
digital assistants, and digital camcorders/cameras.
- - Projection - Fixed systems to replace current desktop computer
monitors or rear projector systems.
- - Image Capture - Systems to capture data such as bar code readers,
scientific images and surgical cameras.
During the three months ended March 31, 2000 the Company sold additional
engineering prototype units of its first commercial Retinal Scanning Display
product. The Company plans to introduce a production version of the Retinal
Scanning Display in 2001. Sales of production version Retinal Scanning Displays
may not occur however, until substantially later, if at all.
Future revenues, profits and cash flow and the achievement of the Company's
strategic objectives will depend on a number of factors, including but not
limited to the following:
- - Acceptance of the Retinal Scanning Display technology by various industries
and OEMs,
- - Market acceptance of products using the Retinal Scanning Display
technology, and
- - The technical performance of the Company's products.
The Company has incurred substantial losses since beginning operations and our
operating losses may increase in the future.
Plan of Operation
The Company intends to continue entering into strategic relationships with
systems integrators and equipment manufacturers to pursue the development of
commercial products incorporating the Retinal Scanning Display technology.
The Company also plans to continue to pursue, obtain and perform on development
contracts. The Company expects that such contracts will further development of
the Retinal Scanning Display technology and lead to commercial products. The
Company also plans to invest funds for ongoing innovation and improvements to
the Retinal Scanning Display technology. These innovations and improvements
include developing component technology, building additional prototypes, and
designing components and products for manufacturability. The Company has
established, staffed, and equipped in-house laboratories to support work on
development contracts as the well as product and technology development. The
Company intends to continue hiring qualified sales, marketing, technical and
other personnel and to continue investing in laboratory facilities and equipment
to achieve development and production objectives.
10
<PAGE>
Results of Operations
THREE MONTHS ENDED MARCH 31, 2000 COMPARED TO
THREE MONTHS ENDED MARCH 31, 1999
CONTRACT REVENUE. Contract revenue in the three months ended March 31, 2000
decreased by approximately $200,000 or 8% to $2.1 million from $2.3 million in
the same period in 1999. The decrease resulted from a smaller amount of revenue
from development contracts recognized in the three months ended March 31, 2000
than in the same period in the prior year. Revenue in both the three months
ended March 31, 2000 and 1999, includes revenue for which precontract costs were
recognized in the prior quarters. The Company's customers have included both the
United States government and commercial enterprises.
COST OF REVENUE. Cost of revenue includes both the direct and indirect costs of
performing on development contracts. These costs include additional staff and
related support costs associated with building the Company's technical
capabilities and capacity to perform on development contracts the Company
expects to enter into in the future.
Cost of revenue in the three months ended March 31, 2000 decreased by $200,000
or 14% to $1.5 million from $1.7 million in the same period in 1999. The
decrease is attributable to a lower research and development overhead cost
allocation to cost of revenue in the three months ended March 31, 2000 than in
the same period in 1999. Research and development overhead is allocated based on
relative direct labor cost incurred in cost of revenue and research and
development expense.
The Company expects that the cost of revenue, on an absolute basis, will
increase in the future. This increase likely will result from additional
development contract work that the Company expects to perform. As a percentage
of contract revenue, the Company expects the cost of revenue to decline over
time as the Company realizes economies of scale associated with higher levels of
development contract business.
RESEARCH AND DEVELOPMENT EXPENSE. Research and development expense consists of:
- - Compensation related costs of employees and contractors engaged in internal
research and product development activities,
- - Laboratory operations, outside development and processing work,
- - Fees and expenses related to patent applications, prosecution and
protection, and
- - Other operating expenses.
Included in research and development expenses are costs incurred in acquiring
and maintaining licenses of technology from other companies. The Company has
expensed all research and development costs.
11
<PAGE>
Research and development expense in the three months ended March 31, 2000
increased by $2.7 million or 308% to $3.6 million from $900,000 in the same
period in 1999. The increase reflects continued implementation of the Company's
operating plan, which calls for building technical staff and supporting
activities, establishing and equipping in-house laboratories, and developing and
maintaining intellectual property.
The Company believes that a substantial level of continuing research and
development expense will be required to develop commercial products using the
Retinal Scanning Display technology. Accordingly, the Company anticipates that a
high level of research and development spending will continue. These expenses
will include the following:
- - Hiring additional technical and support personnel,
- - Expanding and equipping in-house laboratories,
- - Acquiring rights to additional technologies, and
- - Subcontracting development work with development partners.
MARKETING, GENERAL AND ADMINISTRATIVE EXPENSE. Marketing, general and
administrative expenses include compensation and support costs for sales,
marketing, management and administrative staff, and for other general and
administrative costs, including legal and accounting, consultants, and other
operating expenses.
Marketing, general and administrative expenses in the three months ended March
31, 2000 increased by $800,000 or 45% to $2.5 million from $1.7 million in the
same period in 1999. The increase includes increased compensation and support
costs for employees and contractors. The Company expects marketing, general and
administrative expenses to increase substantially in future periods as the
Company:
- - Adds to its sales and marketing staff,
- - Makes additional investments in sales and marketing activities and
- - Increases the level of corporate and administrative activity.
INTEREST INCOME AND EXPENSE. Interest income in the three months ended March 31,
2000 increased by $406,000 or 874% to $452,000 from $46,000 in the same period
in 1999. This increase resulted from higher average cash and investment
securities balances in the three months ended March 31, 2000 than the average
cash and investment securities balances in the same period of the prior year.
Interest expense in the three months ended March 31, 2000 increased by $39,900
or 108% to $76,800 from $36,900 in the same period in 1999. This increase
resulted from interest related to new long-term debt incurred for leasehold
improvements in a new facility and additional capital leases.
12
<PAGE>
Liquidity and Capital Resources
The Company has funded operations to date primarily through the sales of common
stock, convertible preferred stock and, to a lesser extent, contract revenue. At
March 31, 2000, the Company had $30.4 million in cash, cash equivalents and
investment securities balances.
Cash used in operating activities totaled $3.7 million during the three months
ended March 31, 2000 compared to $2.5 million in the same period in 1999. Cash
used in operating activities for each period resulted primarily from the net
loss for the period.
Cash provided by investing activities totaled $2.3 million during the three
months ended March 31, 2000, compared to cash used in investing activities of
$1.1 million in the same period of 1999. The increase in cash provided by
investing activities resulted primarily from the timing of maturities in the
investment portfolio. The Company balances the maturity dates of the investment
portfolio to its expected cash requirements.
The Company used $350,000 cash for capital expenditures during the three months
ended March 31, 2000 compared to $550,000 for the same period in 1999.
Historically, capital expenditures have been used to make leasehold improvements
to leased office space and to purchase computer hardware and software,
laboratory equipment and furniture and fixtures to support growth. The Company
expects capital expenditures to continue to increase significantly as the
Company continues to expand operations. The Company currently has no material
commitments for capital expenditures.
Cash provided by financing activities totaled $2.3 million during the three
months ended March 31, 2000, compared to $5.2 million in the same period in
1999. Cash provided by financing activities during the three months ended March
31, 2000, resulted primarily from the exercise of stock options under the
employee stock option plans.
Future operating expenditures and capital requirements will depend on numerous
factors, including the following:
- - The progress of research and development programs,
- - The progress in commercialization activities and arrangements,
- - The cost of filing, prosecuting, defending and enforcing any patent claims
and other intellectual property rights,
- - Competing technological and market developments, and
- - The Company's ability to establish cooperative development, joint venture
and licensing arrangements.
In order to maintain exclusive rights under the license agreement with the
University of Washington, the Company is obligated to make royalty payments to
the University of Washington. If the Company is successful in establishing OEM
co-development and joint venture arrangements, the Company expects that its
partners will fund a portion of non-recurring engineering costs for product
development. Nevertheless, the Company expects cash requirements to increase
significantly each year as the Company expands its activities and operations to
take products to market.
13
<PAGE>
The Company believes that its cash, cash equivalents and investment securities
balances at March 31, 2000 will satisfy its budgeted cash requirements for at
least the next 12 months (based on the current operating plan). Actual expenses,
however, may be higher than predicted and the Company may require additional
capital earlier. The Company may require additional capital to:
- - Accelerate the development of Retinal Scanning Display technology,
- - Respond to competitive pressures, or
- - Meet unanticipated development difficulties.
The Company's operating plan calls for the addition of technical and business
staff and the purchase of additional computer and laboratory equipment. The
operating plan also provides for the development of strategic relationships with
systems and equipment manufacturers. There can be no assurance that additional
financing will be available to us or that, if available, it will be available on
acceptable terms on a timely basis. If adequate funds are not available to
satisfy either short-term or long-term capital requirements, the Company may be
required to reduce operations significantly. The Company's capital requirements
will depend on many factors, including, but not limited to, the rate at which
the Company can, directly or through arrangements with OEMs, introduce products
incorporating the Retinal Scanning Display technology and the market acceptance
and competitive position of such products.
SUBSEQUENT EVENTS
In March 2000, the Company received a commitment from Cree Inc. and General
Electric Pension Trust to purchase an aggregate of 500,000 shares of common
stock for $25.0 million. The sale was completed and the shares were issued in
April, 2000.
In April 2000, a private investor exercised a warrant to purchase 418,848 shares
of common stock at a price of $17.91. Total proceeds from the sale were $7.5
million.
14
<PAGE>
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Most of the Company's cash equivalents and investment securities are at fixed
interest rates and, as such, the fair value of these instruments is affected by
changes in market interest rates. As of March 31, 2000, approximately $26.8
million or 86% of the Company's total investment portfolio matures within one
year. The Company's portfolio consists of only high-grade government agency
securities and commercial paper. Accordingly, the Company believes that its
interest rate risk is immaterial. In addition, substantially all of the
Company's development contract payments are made in U.S. dollars and,
consequently, the Company believes its foreign currency exchange rate risk is
immaterial. The Company does not have any derivative instruments and does not
engage in hedging transactions.
15
<PAGE>
Part II
OTHER INFORMATION
Items 1 through 5 of Part II are inapplicable and have been omitted from this
report.
Item 6. Exhibits and Reports on Form 8-K
a.) EXHIBITS
4.1 Common Stock Purchase Warrant, dated as of April 1, 1999, issued to
Josephthal & Co., Inc.(1)
10.1 Microvision, Inc., Independent Stock Option Plan(2)
10.2 Microvision, Inc., 1996 Stock Option Plan, as amended(2)
27. Financial Data Schedule
- -------------------------------------------------------------------------------
(1) Incorporated by reference to Registration Statement on Form S-3,
Registration No. 333-33612.
(2) Incorporated by reference to the Company's definitive proxy Statement,
filed with the Securities and Exchange Commission on April 28, 2000.
16
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
MICROVISION, INC.
Date: May 9, 2000 RICHARD F. RUTKOWSKI
--------------------------------------------
Richard F. Rutkowski
President, Chief Executive Officer
(Principal Executive Officer)
Date: May 9, 2000 JEFF WILSON
------------------------------------
Jeff Wilson
Chief Accounting Officer
(Principal Accounting Officer)
17
<PAGE>
EXHIBIT INDEX
The following documents are filed herewith or have been included as exhibits
to previous filings with the Securities and Exchange Commssion and are
incorporated by reference as indicated below.
Exhibit Number Description
- -------------- -----------
4.1 Common Stock Purchase Warrant, dated as of April 1, 1999,
issued to Josephthal & Co., Inc.(1)
10.1 Microvision, Inc., Independent Stock Option Plan(2)
10.2 Microvision, Inc., 1996 Stock Option Plan, as amended(2)
27. Financial Data Schedule
- -------------------------------------------------------------------------------
(1) Incorporated by reference to Registration Statement on Form S-3,
Registration No. 333-33612.
(2) Incorporated by reference to the Company's definitive proxy Statement,
filed with the Securities and Exchange Commission on April 28, 2000.
18
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED FINANCIAL STATEMENTS OF MICROVISION, INC., FOR THE THREE MONTH PERIOD
ENDED MARCH 31, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 3,730,200
<SECURITIES> 26,715,200
<RECEIVABLES> 1,789,600
<ALLOWANCES> (69,000)
<INVENTORY> 0
<CURRENT-ASSETS> 33,968,300
<PP&E> 4,749,700
<DEPRECIATION> (1,557,400)
<TOTAL-ASSETS> 38,908,800
<CURRENT-LIABILITIES> 3,387,900
<BONDS> 0
0
0
<COMMON> 80,208,100
<OTHER-SE> (45,491,700)
<TOTAL-LIABILITY-AND-EQUITY> 38,908,800
<SALES> 0
<TOTAL-REVENUES> 2,109,500
<CGS> 0
<TOTAL-COSTS> 1,467,500
<OTHER-EXPENSES> 6,081,300
<LOSS-PROVISION> 9,000
<INTEREST-EXPENSE> (76,800)
<INCOME-PRETAX> (5,073,200)
<INCOME-TAX> 0
<INCOME-CONTINUING> (5,073,200)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (5,073,200)
<EPS-BASIC> (.48)
<EPS-DILUTED> (.48)
</TABLE>
