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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 19, 1997
LITHIUM TECHNOLOGY CORPORATION
(Exact Name of Small Business Issuer as Specified in Its Charter)
Delaware 1-10446 13-3411148
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State or Other Jurisdiction Commission IRS Employer
of Incorporation or Organization File Number Identification No.
5115 Campus Drive, Phymouth Meeting, PA 19462
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Address of Principal Executive Offices Zip Code
Registrant's telephone number, including area code: (610) 940-6090
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Former name or former address, if changed since last report
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Item 5. Other Events.
Amendments to Certain Terms of the October 1996 Convertible Notes
As reported previously by the Company, in October 1996 the Company
entered into a convertible note transaction whereby it issued $1.75 million
principal amount convertible notes (the "Convertible Notes") to two non-U.S.
investors (the "Lenders"). The Convertible Notes had a maturity date of March
24, 1997. Since the Convertible Notes were not repaid by March 24, 1997, the
Company, pursuant to the terms of the Convertible Notes, delivered certain
shares of its common stock to an escrow agent (the "Escrowed Shares") to
provide for the potential conversion of the Convertible Notes. On August 19,
1997, the Company and the Lenders entered into an agreement (the "Amendment
Agreement") to, among other things, extend the maturity date to November 2,
1998 and provide for the repayment of the Convertible Notes by means of cash
payments by the Company and the conversion and sale of certain of the Escrowed
Shares.
The Amendment Agreement also contains the following material terms: (i)
the Company will repay $100,000 of the principal amount of the Convertible
Notes in cash; (ii) the Company will pay $70,479, representing the accrued and
unpaid interest on the Convertible Notes up to and including August 18, 1997;
(iii) the Lenders will be permitted to sell a sufficient quantity of the
Escrowed Shares to allow the Lenders to recover the remaining $1.65 million
principal amount of the Convertible Notes. The number of shares which the
Lenders will be permitted to sell publicity will depend upon the price and
volume of trading in the Company's common stock. Once the Lenders receive the
remaining principal through the sales of the Escrowed Shares or through
payments by the Company, the Convertible Notes will be deemed to be satisfied;
(iv) the Company will transfer to the Lenders 12.5% of any Escrowed Shares
remaining after the Convertible Notes are repaid, or such greater amount up to
20%, depending upon the occurrence of certain future events, and the remaining
Escrowed Shares will be retired by the Company; and (v) if there is a change in
the law such that the Escrowed Shares are not permitted to be resold by the
Lenders in the United States, the Company will file a registration statement to
register the Escrowed Shares.
The Amendment Agreement is subject to the Company's closing on the sale
of between $3.25 million and $5 million principal amount Senior Secured
Convertible Notes (the "Interlink Transaction"), as described in the Company's
press release dated August 19, 1997, which is attached hereto as Exhibit 99.3.
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Item 7. Financial Statements and Exhibits
Exhibits.
99.3 Press Release, dated August 19, 1997.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
LITHIUM TECHNOLOGY CORPORATION
By: /s/ David J. Cade
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David J. Cade
President and
Chief Operating Officer
Date: August 19, 1997
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FOR IMMEDIATE RELEASE
LITHIUM TECHNOLOGY CORPORATION ANNOUNCES
COMPLETION OF BRIDGE FINANCING AS FIRST STEP IN
$3.25 MILLION TO $5 MILLION PRIVATE PLACEMENT
PLYMOUTH MEETING, PENNSYLVANIA, AUGUST 19, 1997 -- Lithium Technology
Corporation ("the Company") (OTC Bulletin Board: LITH) today announced that it
has closed on a $500,000 bridge loan arranged by Interlink Management
Corporation of Houston, Texas. Interlink's Chairman, Neil Bush, is in the
process of bringing together a group of investors to complete the Phase I
private placement of $3.25 million to $5 million of senior secured notes and
the Phase II strategic partner investment of $7 million to $10 million as
stipulated in the Letter of Intent between the Company and Interlink, announced
on June 13, 1997. The $500,000 bridge loan will be rolled into the Phase I
funding currently scheduled for closing on September 15, 1997. The Phase I and
Phase II financings are subject to customary closing conditions, including
completion of satisfactory due diligence by the investors and the execution of
definitive legal agreements.
In conjunction with this private placement, the Company has also reached
agreement with a group of UK-based investors regarding the restructuring and
repayment of the $1.75 million convertible notes issued in October 1996. This
group's ongoing strong support and long term commitment to Lithium have played
a significant role in helping to advance the Company's lithium polymer battery
technology. Details of the agreement will be available in an 8K filing at the
Securities & Exchange Commission.
In commenting on these developments, Lithium's President David J. Cade said,
"The Interlink funding provides the critical next step in enabling the Company
to take our advanced technology to the marketplace. Moreover, the technical due
diligence done in conjunction with this financing has further validated the
ability of our technology to provide product differentiation for a notebook
computer or cellular phone Original Equipment Manufacturer (OEM)." In this
regard, the Company continues to ship cell samples produced on its prototype
production line to selected OEMs in anticipation of developing battery pack
samples for one or two specific device applications later in 1997.
Lithium Technology Corporation is developing a new generation of solid state
rechargeable batteries for portable electronics devices. The Company's patented
and proprietary technology uses high performance fibers in composite battery
structures along with web coating and related processes for manufacturing.
Contacts: Lithium Technology Corporation
Gretchen N. Deming
Director of Administration
and Shareholder Relations
(610) 940-6090 Ext. 109
Consulting For Strategic Growth, Ltd.
Stanley Winderlich/John Harbaugh
Corporate Development Consultants
(800) 625-2236/(800) 807-6388
