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 11, 1999
Electrosource, Inc.
(Exact name of registrant as specified in its
charter)
Delaware 0-16323 74-
2466304
(State or other (Commission File (IRS
Employer
jurisdiction of Number)
Identification No.)
incorporation)
2809 IH 35 South 78666
San Marcos, Texas
(Zip Code)
(Address of principal executive
offices)
Registrant's telephone number, including area
code: (512) 753-6500
Page 1 of 4 Pages
An Exhibit Index appears on page 3
Item 5. Other Events
On August 11, 1999, the Electrosource,
Inc. (the
"Registrant") Board of Directors accepted the
resignation of its accounting audit firm, Ernst &
Young, L.L.P. The Registrant has filed a press
release relating to these changes in management
under cover of this Current Report on Form 8-K.
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act
of 1934, the registrant has duly caused this report
to be signed on its behalf by the undersigned
hereunto duly authorized.
ELECTROSOURCE, INC.
By: /s/ Donald C. Perriello
Donald C. Perriello
Chief Accounting Officer
Vice President, Finance
Date: August 20, 1999
EXHIBITS
Exhibit Page
Number
1 Press release relating to 4
resignation of Ernst & Young, L.L.P.
Electrosource, Inc.
2809 Interstate 35 South, San Marcos, Texas
78666-5930 USA
Tel: 512-753-6500 Fax: 512-353-3391
www.electrosource.comManufacturers of the HORIZONr C2M
Battery
ELECTROSOURCE NEWS
ELECTROSOURCE, INC. ANNOUNCES MANAGEMENT
CHANGE,
SECOND QUARTER 1999 OPERATING RESULTS
AND RESIGNATION OF ERNST & YOUNG AS AUDITORS
San Marcos, Texas (August 12, 1999) -
ELECTROSOURCE, INC. (Nasdaq: ELSI) ("the Company")
today announced that Mr. Benny E. Jay has been
elected by the Board of Directors to serve as
President, Chief Executive Officer and a
Director for
Electrosource, Inc., effective August 16, 1999.
Its first official employee, Mr. Jay has been with
Electrosource since its inception in 1987. He has
served in numerous technical, marketing and
management capacities, and is a key contributor to
the development of the Company's Horizonr battery.
He has been instrumental in introducing that
technology to a variety of customers worldwide.
Mr. Jay's election follows the promotion of Mr.
William F. Griffin, Electrosource's former
President, Chief Executive Officer and Chairman
of the Board, to a senior position within the
Kamkorp Group, the Company's majority
shareholder. Mr. Griffin will remain on the
Electrosource Board of Directors. In the near
term, he will continue to serve the Company in
an advisory capacity. The Board also approved
increasing the number of directors from eight to
nine. These actions were taken at a meeting of the
Board of Directors on Tuesday, August 10, 1999.
The Company also announced its operating results for
the second quarter and six months ended June 30,
1999:
Net loss for the three months ended June 30,
1999, was
($991,668), or ($0.10) per share, compared to net
income of $1,411,923 (which included an
extraordinary gain), or $0.27 per
share, for the same period in 1998. Net loss for the
six months
ended June 30, 1999 was ($2,176,487), or ($0.24)
per share, compared to ($1,144,399) or ($0.24) per
share for the same period in 1998. The 1998 second
quarter results include an extraordinary gain from the early
extinguishment of debt of $3,532,045
resulting from an agreement reached with Corning
Incorporated ("Corning") in which the Company
retired the full $6,293,000 in Convertible Notes
Payable and accrued interest owed to Corning in
exchange for $1,500,000 in cash.
Revenue for the three months ended June 30, 1999
was $423,324 compared to $328,574 for the same
period in 1998, a 29% increase. Revenue for the
six months ended June 30, 1999 was $795,040
compared to $632,148 for the same period in 1998, a
26% increase.
ELECTROSOURCE, INC.
Summary Statements of Operations (Unaudited)
Three Months Ended Six
Months Ended
June 30, June 30,
1999 1998 1999 1998
Revenues $423,324 $328,574 $795,040 $632,148
Costs and Expenses 1,414,992 2,448,696
2,971,527 5,308,59
2
Loss before (991,668) (2,120,12
(2,176,48 (4,676,4
extraordinary gain 2) 7) 44)
Extraordinary gain - 3,532,045 - 3,532,04
5
Net income (loss) $(991,668 $1,411,92
$(2,176,4 $(1,144,
) 3 87) 399)
Net income (loss) per $(0.10) $0.27 $(0.24) $(0.24)
common share
Average common shares 9,576,301 5,164,202
9,122,280 4,851,10
outstanding 5
Ernst & Young, L.L.P., the Company's auditors
for fiscal years 1987 through 1998, resigned
effective August 11, 1999. The Company is in
discussion with a number of regional auditing firms
to replace Ernst & Young, and expects to appoint new
auditors by the end of the third quarter.
Electrosource, headquartered in San Marcos,
Texas, designs, manufactures and markets
proprietary advanced energy storage technologies
and systems. Additional information about the
Company is located on the internet at
www.electrosource.com.
# # #
This release contains forward-looking
statements that involve risks and uncertainties.
Actual results could differ materially from those
discussed in this release. Risks include financial
risks, development risks, manufacturing risks,
uncertainty of market acceptance, delay in
shipment or cancellation of orders, customer
reorganization, as well as other risks that are
detailed from time to time in the company's
Securities and Exchange Commission filings.
SOURCE Electrosource, Inc.
Contact: Benny E. Jay of Electrosource, Inc.
512-753-6500
