<PAGE> 1
--------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000
or
[ ] 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 0-19793
METRETEK TECHNOLOGIES, INC.
(Exact name of small business issuer as specified in its charter)
DELAWARE 84-1169358
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1675 Broadway, Suite 2150
Denver, Colorado 80202
(Address of principal executive offices) (Zip code)
(303)592-5555
(Issuer's telephone number, including area code)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 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.
Yes [X] No [ ]
As of July 31, 2000 there were 5,198,675 shares of the issuer's Common
Stock outstanding.
Transitional Small Business Disclosure Format
Yes [ ] No [X]
--------------------------------------------------------------------------------
<PAGE> 2
METRETEK TECHNOLOGIES, INC.
FORM 10-QSB
TABLE OF CONTENTS
Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Unaudited Consolidated Balance Sheets -
June 30, 2000 and December 31, 1999 3
Unaudited Consolidated Statements of Operations -
For the Three Months Ended June 30, 2000 and
June 30, 1999
For the Six Months Ended June 30, 2000 and
June 30, 1999 5
Unaudited Consolidated Statements of Cash Flows -
For the Six Months Ended June 30, 2000 and
June 30, 1999 6
Notes to Unaudited Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 12
PART II. OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds 24
Item 4. Submission of Matters to a Vote of Security Holders 25
Item 6. Exhibits and Reports on Form 8-K 25
Signatures 26
2
<PAGE> 3
PART I.
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
METRETEK TECHNOLOGIES, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(unaudited)
<TABLE>
<CAPTION>
June 30, December 31,
2000 1999
------------ ---------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 3,568,505 $ 361,658
Trade receivables, less allowance for doubtful accounts
of $107,126 and $125,573, respectively 3,728,793 3,802,818
Other receivables - 2,818
Inventories 4,239,539 4,155,429
Net assets of discontinued operations 690,918 338,455
Prepaid expenses and other current assets 322,424 435,734
------------ ------------
Total current assets 12,550,179 9,096,912
------------ ------------
PROPERTY, PLANT AND EQUIPMENT, AT COST:
Equipment 3,729,793 2,453,492
Vehicles 46,630 52,277
Furniture and fixtures 564,115 508,490
Land, building and improvements 816,760 718,604
------------ ------------
Total 5,157,298 3,732,863
Less accumulated depreciation 2,374,019 2,179,015
------------ ------------
Property, plant and equipment, net 2,783,279 1,553,848
------------ ------------
OTHER ASSETS:
Customer lists (net of accumulated amortization
of $3,178,561 and $2,955,939, respectively) 5,714,326 5,936,948
Goodwill and other intangibles (net of accumulated
amortization of $1,307,794 and $1,048,676, respectively) 4,551,992 2,842,036
Other assets 183,424 180,690
------------ ------------
Total other assets 10,449,742 8,959,674
------------ ------------
TOTAL $25,783,200 $19,610,434
============ ============
</TABLE>
See notes to unaudited consolidated financial statements.
3
<PAGE> 4
METRETEK TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
June 30, December 31,
2000 1999
---- ----
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 2,397,034 $ 658,900
Accrued and other liabilities 2,250,877 1,365,240
Current portion of notes payable 410,229 -
------------ ------------
Total current liabilities 5,058,140 2,024,140
------------ ------------
LONG-TERM NOTES PAYABLE 333,333 869,968
------------ ------------
COMMITMENTS AND CONTINGENCIES - -
MINORITY INTEREST IN SUBSIDIARY 183,727 -
------------ ------------
REDEEMABLE PREFERRED STOCK - SERIES B,
$.01 PAR VALUE; AUTHORIZED, 1,000,000 SHARES;
7,000 AND 1,450 ISSUED AND OUTSTANDING
RESPECTIVELY; REDEMPTION VALUE $1,000
PER SHARE 6,535,221 1,457,310
------------ ------------
STOCKHOLDERS' EQUITY:
Redeemable Preferred Stock - undesignated, $.01 par value;
authorized, 2,000,000 shares; none issued and outstanding
Redeemable Preferred Stock - Series C, $.01 par value; authorized,
500,000 shares; none issued and outstanding
Common Stock, $.01 par value; authorized, 25,000,000 shares;
issued and outstanding, 5,183,775 and 3,784,045
shares, respectively 51,837 37,840
Additional paid-in capital 47,063,355 40,434,688
Accumulated other comprehensive loss (5,926) (4,098)
Accumulated deficit (33,436,487) (25,209,414)
------------ ------------
Total stockholders' equity 13,672,779 15,259,016
------------ ------------
TOTAL $ 25,783,200 $ 19,610,434
============ ------------
See notes to unaudited consolidated financial statements.
</TABLE>
4
<PAGE> 5
METRETEK TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
--------------------------- -----------------------
June 30, June 30, June 30, June 30,
2000 1999 2000 1999
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
REVENUES:
Natural gas measurement sales and services $ 5,547,312 $ 4,937,494 $ 10,155,896 $ 9,892,164
Other 197,327 7,254 231,141 18,111
----------- ----------- ------------ -----------
Total revenues 5,744,639 4,944,748 10,387,037 9,910,275
----------- ----------- ------------ -----------
COSTS AND EXPENSES:
Cost of measurement sales and services 4,072,422 3,169,534 7,543,886 6,830,257
General and administrative 1,338,389 783,963 2,616,452 1,650,727
Selling, marketing and service 531,838 568,277 1,028,408 1,039,120
Depreciation and amortization 374,211 317,684 689,692 636,522
Research and development 3,947,696 289,224 7,332,439 563,867
Interest, finance charges and other 34,124 68,101 79,656 144,857
----------- ----------- ------------ -----------
Total costs and expenses 10,298,680 5,196,783 19,290,533 10,865,350
----------- ----------- ------------ -----------
LOSS FROM OPERATIONS BEFORE
MINORITY INTEREST AND TAXES (4,554,041) (252,035) (8,903,496) (955,075)
MINORITY INTEREST IN NET LOSS 580,615 - 676,416 -
INCOME TAXES - - - -
----------- ----------- ------------ -----------
NET LOSS (3,973,426) (252,035) (8,227,080) (955,075)
----------- ----------- ------------ -----------
PREFERRED STOCK DEEMED DISTRIBUTION (2,564,202) - (5,077,911) -
----------- ----------- ------------ -----------
NET LOSS ATTRIBUTABLE TO COMMON
SHAREHOLDERS $(6,537,628) $ (252,035) $(13,304,991) $ (955,075)
=========== =========== ============ ===========
NET LOSS PER COMMON SHARE:
Basic $(1.27) $(0.07) $(2.75) $(0.27)
=========== =========== ============ ===========
Diluted $(1.27) $(0.07) $(2.75) $(0.27)
=========== =========== ============ ===========
WEIGHTED AVERAGE BASIC AND
DILUTED COMMON SHARES
OUTSTANDING 5,140,093 3,472,583 4,841,335 3,474,031
=========== =========== ============ ===========
</TABLE>
See notes to unaudited consolidated financial statements.
5
<PAGE> 6
METRETEK TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
------------------------------------
2000 1999
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (8,227,080) $ (955,075)
Adjustments to reconcile net loss to net cash
(used) provided by continuing operations:
Depreciation and amortization 689,692 636,522
Minority interest in PowerSpring (676,416) -
Stock based compensation expense 66,387 -
Loss on disposal of property, plant and equipment 13,023 417
Changes in other assets and liabilities, net of effect of acquisition:
Trade receivables 177,204 1,121,132
Inventories (84,110) 49,744
Other current assets 46,856 99,054
Other noncurrent assets 2,886 3,980
Accounts payable 1,694,626 (353,077)
Accrued and other liabilities 884,309 35,782
------------- ------------
Net cash (used) provided by continuing operations (5,412,623) 638,479
Net cash used by discontinued operations (352,463) (6,225)
------------- ------------
Net cash (used) provided by operating activities (5,765,086) 632,254
------------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition (441,583) -
Additions to property, plant and equipment (1,447,650) (121,417)
Proceeds from sale of property, plant and equipment 11,249 7,800
------------- ------------
Net cash used by investing activities (1,877,984) (113,617)
------------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from private placement 10,579,585 -
Payments on notes payable to bank (273,658) (509,499)
Exercise of stock options and warrants 543,990
Repurchase of Common Stock - (60,571)
Payments on capital lease obligations - (1,158)
------------- ------------
Net cash provided (used) by financing activities 10,849,917 (571,228)
------------- ------------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS 3,206,847 (52,591)
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD 361,658 639,448
------------- ------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 3,568,505 $ 586,857
============= ============
</TABLE>
See notes to unaudited consolidated financial statements.
6
<PAGE> 7
METRETEK TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
As of June 30, 2000 and December 31, 1999
For the Three Month Periods Ended June 30, 2000 and 1999 and
For the Six Month Periods Ended June 30, 2000 and 1999
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying consolidated financial statements include the accounts
of Metretek Technologies, Inc. and its subsidiaries, primarily Metretek,
Incorporated ("Metretek"), Southern Flow Companies, Inc. ("Southern Flow") and
PowerSpring, Inc. ("PowerSpring"), and have been prepared pursuant to rules and
regulations of the Securities and Exchange Commission. The accompanying
consolidated financial statements and notes thereto should be read in
conjunction with the consolidated financial statements and notes thereto
included in the Company's Annual Report on Form 10-KSB for the year ended
December 31, 1999.
Minority interest amounts included in the consolidated financial
statements represent an outside shareholder's 12.5% ownership interest in
PowerSpring. In addition, certain 1999 amounts have been reclassified to conform
to current year presentation.
In the opinion of the Company's management, all adjustments (all of
which are normal and recurring) have been made which are necessary for a fair
presentation of the consolidated financial position of the Company and its
subsidiaries as of June 30, 2000 and the consolidated results of their
operations and cash flows for the three and six month periods ended June 30,
2000 and 1999.
2. COMPREHENSIVE LOSS
The Company's comprehensive loss for the six months ended June 30, 2000
and 1999 was $8,228,908 and $965,830, respectively. The Company's comprehensive
loss includes net loss and foreign currency translation adjustments.
3. PRIVATE PLACEMENT
On February 4, 2000, the Company completed a $14,000,000 private
placement (the "Units Private Placement") of 7,000 "Units", including 1,450
Units the Company issued on December 9, 1999. Each Unit consisted of 200 shares
of Common Stock, 1 share of Series B Preferred Stock and warrants ("Unit
Warrants") to purchase 100 shares of common stock, par value $.01 per share
("Common Stock"), of the Company. In the Units Private Placement, the Company
issued 1,400,000 shares of Common Stock, 7,000 shares of Series B Preferred
Stock and Unit Warrants to purchase 700,000 shares of Common Stock. The Units
Private Placement was approved and ratified by the stockholders of the Company
at a special meeting held on February 3, 2000.
7
<PAGE> 8
Each share of Series B Preferred Stock is mandatorily redeemable on
December 9, 2004 at a liquidation preference of $1,000 per share plus accrued
and unpaid dividends, accrues dividends at 8% annually payable quarterly in
arrears, and is convertible at any time after June 9, 2000 at the option of the
holder into 168.5374 shares of Common Stock of the Company. In addition, the
Company has the right to redeem the Series B Preferred Stock on or after
December 9, 2000, if the Company's Common Stock is trading at 200% of the
conversion price of the Series B Preferred Stock. The conversion rate of the
Series B Preferred Stock may be subject to downward adjustment on December 9,
2000 if the average closing bid price of the Company's Common Stock for the 30
trading days immediately preceding that date is less than the conversion price
then in effect, provided that the conversion price cannot be reduced by more
than 50%. The Series B Preferred Stock is also subject to certain anti-dilution
provisions.
Each Unit Warrant entitles the holder to purchase one share of the
Company's Common Stock at an initial exercise price of $6.7425 per share. The
initial exercise price of the Unit Warrants may also be subject to downward
adjustment on December 9, 2000 if the average closing bid price of the Company's
Common Stock for the 30 trading days immediately preceding that date is less
than the exercise price of the Unit Warrants then in effect.
The proceeds from the sale of the Units, including the 1,450 Units
issued on December 9, 1999, have been allocated to Common Stock, the Unit
Warrants, and the Series B Preferred Stock based on the relative fair value of
each on the date of issuance. This allocation process resulted in the Series B
Preferred Stock issued on February 4, 2000 being initially recorded at a
discount of $141 per share from its $1,000 per share liquidation value. This
discount will be recorded as a deemed distribution over the term of the Series B
Preferred Stock. Another discount resulted from the increase in the fair market
value of a share of the Company's Common Stock from the date the Company offered
to sell 5,550 Units to February 4, 2000, the date the Units were issued. This
increase caused the conversion feature of the Series B Preferred Stock to be "in
the money" on February 4, 2000. The discount of $859 per share related to the
"in the money" conversion feature will also be recorded as a deemed distribution
between February 4 and June 9, 2000, the date the Series B Preferred Stock can
first be converted into Common Stock of the Company. The balance of the
unamortized discounts at June 30, 2000 and December 31, 1999 was $728,674 and
$0, respectively.
The primary purpose of the Units Private Placement was to raise capital
to enable the Company to develop the Internet-based business of PowerSpring. A
portion of the proceeds was also used to repay outstanding indebtedness, and the
remaining proceeds will be used for general corporate and working capital
purposes, including potentially providing the funds to finance an acquisition
opportunity, if one were to arise.
8
<PAGE> 9
4. ACQUISITION
On March 17, 2000, the Company acquired Mercator Energy Incorporated
("Mercator") through a merger with a wholly owned subsidiary of PowerSpring.
Mercator is a Denver-based natural gas services and brokerage company that acts
as an independent broker-agent for both producers and users. This acquisition
will provide PowerSpring with Mercator's expertise in the area of energy
procurement, which is an important element in the Company's Internet business
strategy.
In consideration for the acquisition of Mercator, the Company delivered
to the sole shareholder of Mercator prior to the acquisition, $408,334 in cash,
a $741,666 non-negotiable promissory note payable by PowerSpring over two years
and secured by a general security interest in the assets of PowerSpring, and
2,500,000 shares of Common Stock of PowerSpring. Subsequent to the acquisition
of Mercator, the Company owns 87.5% of the outstanding shares of PowerSpring
Common Stock, and Mercator has become a wholly owned subsidiary of PowerSpring.
PowerSpring and Metretek entered into a stockholder's agreement with the former
owner of Mercator that addresses certain rights related to PowerSpring Common
Stock, including a right for the former owner of Mercator to put his shares of
PowerSpring Common Stock back to PowerSpring at an appraised value over three
years if PowerSpring has not completed an initial public offering or has not
sold its business within two years.
The acquisition was accounted for as a purchase with the operating
results of Mercator included in the consolidated statements of operation from
the date of acquisition. The purchase price of the Mercator acquisition, subject
to future minor adjustment, was allocated as follows:
Accounts receivable $ 101,000
Property, plant and equipment 14,000
Goodwill 1,915,000
Accounts payable and accrued expenses (23,000)
-----------
$ 2,007,000
===========
Pro forma results of operations for the three months ended June 30,
2000 and 1999 assuming the acquisition had occurred on January 1, 2000 and 1999
have not been included herein as the effects of the acquisition were not
material to the Company's results of operations.
PowerSpring also entered into a two-year employment agreement with the
former owner of Mercator which included an option to purchase 60,000 shares of
Common Stock of the Company, exercisable at $17.88 per share, and an option to
purchase 200,000 shares of PowerSpring Common Stock, exercisable at $.30 per
share.
9
<PAGE> 10
In September 1999, the Company had entered into a consulting and joint
venture agreement with Mercator, under which Mercator provided energy
procurement consulting services to the Company. In connection with the
acquisition of Mercator, the consulting and joint venture agreement and a
related stock option agreement were terminated.
5. SEGMENT INFORMATION
The Company's reportable segments are strategic business units that
offer different products and services. They are managed separately because each
business requires different technology and marketing strategies.
The Company has three reportable business segments: automated energy
data management; natural gas measurement services; and Internet-based energy
information and services. The operations of the Company's automated energy data
management segment are conducted by Metretek. Metretek's manufactured products
fall into three categories: remote data collection products; electronic
corrector products; and application-specific products. Metretek also provides
energy data collection and management services and post-sale support services
for its manufactured products. Historically, Metretek's products and services
have been provided principally to natural gas local distribution companies
("LDCs"). Typically LDCs install Metretek products in conjunction with custody
transfer meters on their larger customers for the purpose of meeting
deregulation requirements.
The operations of the Company's natural gas measurement services
segment are conducted by Southern Flow. Southern Flow's services include on-site
field services, chart processing and analysis, laboratory analysis, and data
management and reporting. These services are provided principally to customers
involved in natural gas production, gathering, transportation and processing.
The operations of the Company's Internet-based energy information and
services segment are conducted by PowerSpring. PowerSpring has incurred
operating costs through June 30, 2000. PowerSpring commenced limited revenue
generating operations in the second quarter of 2000 subsequent to the
acquisition described in Note 4.
The Company evaluates the performance of its operating segments based
on income (loss) before income taxes, nonrecurring items and interest income and
expense. Intersegment sales are not significant.
10
<PAGE> 11
Summarized financial information concerning the Company's reportable
segments is shown in the following table. The "Other" column includes corporate
related items, results of insignificant operations and, as it relates to segment
profit or loss, income and expense not allocated to reportable segments. All
amounts shown are prior to the deduction of minority interest in PowerSpring.
<TABLE>
<CAPTION>
INTERNET-BASED
AUTOMATED NATURAL GAS ENERGY
ENERGY DATA MEASUREMENT INFORMATION
MANAGEMENT SERVICES AND SERVICES OTHER TOTAL
<S> <C> <C> <C> <C> <C>
JUNE 30, 2000
Revenues $4,703,825 $5,373,677 $ 78,394 $ 231,141 $10,387,037
Segment profit (loss) (491,753) 461,679 (8,085,947) (787,475) (8,903,496)
Total assets 9,053,437 9,793,780 3,718,072 3,217,911 25,783,200
JUNE 30. 1999
Revenues $4,275,525 $5,616,639 $ - $ 18,111 $ 9,910,275
Segment profit (loss) (717,867) 534,062 - (771,270) (955,075)
Total assets 9,670,791 10,304,387 - 556,752 20,531,930
</TABLE>
6. CONVERSION OF DEBT
On May 4, 1998, the Company acquired substantially all of the assets
and business of a subsidiary of American Meter Company pertaining to electronic
correctors and non-radio-frequency meter reading devices in the natural gas and
electric utility industry. In consideration for this purchase, the Company
delivered to American Meter an aggregate purchase price consisting of $1,300,000
in cash, 439,560 unregistered shares of Common Stock, and a $600,000 convertible
subordinated promissory note. In April 2000, American Meter converted the note
into 105,495 shares of Common Stock under the terms of the note. Until it was
converted, the note bore interest on the unpaid principal balance at a fixed
rate equal to 7.5% per annum, payable quarterly in arrears, and was due and
payable on May 4, 2002.
11
<PAGE> 12
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
INTRODUCTION
The following discussion of our results of operations for the six month
periods ended June 30, 2000 and 1999 and of our financial condition as of June
30, 2000 should be read in conjunction with our consolidated financial
statements and related notes thereto included elsewhere in this report.
RESULTS OF OPERATIONS
The following table sets forth selected information related to our
primary business segments and is intended to assist you in an understanding of
our results of operations for the periods presented. All amounts shown are prior
to the deduction of minority interest in PowerSpring.
Six Months Ended
June 30,
--------------------------
2000 1999
------- ------
(dollar amounts in thousands)
REVENUES:
Southern Flow $ 5,374 $5,617
Metretek 4,704 4,275
PowerSpring 78 -
Other 231 18
------- ------
Total $10,387 $9,910
======= ======
GROSS PROFIT:
Southern Flow $1,359 $1,365
Metretek 1,396 1,697
PowerSpring (142) -
------- ------
Total $ 2,613 $3,062
======= ======
SEGMENT PROFIT (LOSS):
Southern Flow $ 462 $ 534
Metretek (492) (718)
PowerSpring (8,086) -
Other (787) (771)
------- ------
Total $(8,903) $ (955)
======= ======
12
<PAGE> 13
Our reportable segments are strategic business units that offer different
product and services. They are managed separately because each business requires
different technology and marketing strategies.
We currently have three reportable business segments: automated energy
data management; natural gas measurement services; and Internet-based energy
information and services. The operations of our automated energy data management
segment are conducted by Metretek. Metretek's manufactured products fall into
three categories: remote data collection products; electronic corrector
products; and application-specific products. Metretek also provides energy data
collection and management services and post-sale support services for its
manufactured products.
The operations of our natural gas measurement services segment are
conducted by Southern Flow. Southern Flow's services include on-site field
services, chart processing and analysis, laboratory analysis, and data
management and reporting. These services are provided principally to customers
involved in natural gas production, gathering, transportation and processing.
The operations of our Internet-based energy information and services
segment are conducted by PowerSpring. PowerSpring has incurred operating costs
through June 30, 2000. PowerSpring commenced limited revenue generating
operations in the second quarter of 2000, subsequent to the acquisition of
Mercator.
We evaluate the performance of our operating segments based on income
(loss) before taxes, nonrecurring items and interest income and expense.
Intersegment sales are not significant.
SIX MONTHS ENDED JUNE 30, 2000 COMPARED TO SIX MONTHS ENDED JUNE 30, 1999
Revenues. Our consolidated revenues for the six months ended June 30,
2000 increased $476,762, or 4.8%, compared to the same period in 1999. The
increase was due to an increase in revenues by Metretek and an increase in other
income of $213,030, offset partially by a decrease in revenues by Southern Flow.
Southern Flow's revenues decreased $242,962, or 4.3%, for the six months ended
June 30, 2000, compared to the same period in 1999. Metretek's revenues for the
six months ended June 30, 2000 increased $428,300, or 10.0%, compared to the
same period in 1999, consisting of an increase in domestic sales of $473,263,
offset partially by a decrease in international sales of $44,964. The increase
in Metretek's domestic sales was primarily the result of an increase in circuit
board assembly sales. The decrease in international sales is attributable to a
decrease in sales of Metretek's remote data collection products and systems in
the United Kingdom. A comparison of Metretek's current domestic and
international product mix is as follows:
13
<PAGE> 14
Six Months Ended June 30,
---------------------------
2000 1999
---- ----
(dollar amounts in thousands)
Remote data collection
products and systems $ 2,564 55% $2,522 59%
Electronic corrector products 849 18% 1,389 32%
Circuit board assembly sales 1,291 27% 364 9%
------- ------
Total $ 4,704 $4,275
======= ======
Costs and Expenses. Costs of sales and services include materials,
labor, personnel and related overhead costs incurred to manufacture products and
provide services. Cost of sales and services for the six months ended June 30,
2000 increased $713,629, or 10.4%, compared to the same period in 1999. Southern
Flow's cost of sales and services for the six months ended June 30, 2000
decreased $237,395, or 5.6%, compared to the same period in 1999. Southern
Flow's gross profit margin after costs of sales and services increased to 25.3%
for the six months ended June 30, 2000 from 24.3% for the same period in 1999,
which is within the range of normal fluctuations. Metretek's cost of sales and
services for the six months ended June 30, 2000 increased $730,003, or 28.3%,
compared to the same period in 1999. This increase was due primarily to higher
personnel and related overhead costs associated with circuit board assembly
sales. As a result, although Metretek's revenues for the six months ended June
30, 2000 increased approximately 10.0% compared to the same period in 1999,
Metretek's overall gross profit margin decreased from 39.7% to 29.7% compared to
the same period in 1999.
General and administrative expenses include personnel and related
overhead costs for the support and administrative functions. General and
administrative expenses for the six months ended June 30, 2000 increased
$965,725, or 58.5%, compared to the same period in 1999, due principally to the
effect of the following factors: (i) an increase in expenses of Southern Flow of
approximately $65,000 primarily attributable to increased personnel costs; (ii)
a decrease in expenses of Metretek of approximately $29,000; and (iii) increases
in general and corporate expenses of approximately $929,000 due to increased
professional services, personnel, travel costs and related overhead costs
incurred as a result of PowerSpring for which there were no comparable costs
during the same period in 1999.
Selling, marketing and service expenses consist of personnel and
related overhead costs, including commissions for sales and marketing
activities, together with advertising and promotion costs. Selling, marketing
and service expenses for the six months ended June 30, 2000 decreased $10,712,
or 1.0%, compared to the same period in 1999.
14
<PAGE> 15
Depreciation and amortization expenses include the depreciation and
amortization of real property, customer list, goodwill and capitalized software
development costs. Depreciation and amortization expenses for the six months
ended June 30, 2000 increased $53,170, or 8.4%, compared to the same period in
1999, due to the addition of depreciable equipment in connection with the
development of PowerSpring.
Research and development expenses include payments to third parties,
personnel and related overhead costs for product and service development,
enhancements, and upgrades. Research and development expenses for the six months
ended June 30, 2000 increased $6,768,572, or 1,200.4%, compared to the same
period in 1999. The increase is due primarily to PowerSpring development
expenditures of approximately $6,900,000 for which there were no comparable
costs in 1999.
Interest, finance charges and other expenses include interest and
finance charges on our credit facility as well as other non-operating expenses.
Interest, finance charges and other expenses for the six months ended June 30,
2000 decreased $65,201, or 45.0%, compared to the same period in 1999. The
decrease reflects reduced borrowings in 2000 compared to the same period in 1999
as we utilized private placement proceeds to limit borrowings on our credit
facility.
SEASONALITY AND CYCLICALITY
Metretek historically derives substantially all of its revenues from
sales of its products and services to the utility industry. Metretek has
experienced variability of operating results on both an annual and a quarterly
basis due primarily to utility purchasing patterns and delays of purchasing
decisions as a result of mergers and acquisitions in the utility industry and
changes or potential changes to the federal and state regulatory frameworks
within which the utility industry operates. The utility industry, both domestic
and foreign, is generally characterized by long budgeting, purchasing and
regulatory process cycles that can take up to several years to complete.
Metretek's utility customers typically issue requests for quotes and proposals,
establish committees to evaluate the purchase, review different technical
options with vendors, analyze performance and cost/benefit justifications and
perform a regulatory review, in addition to applying the normal budget approval
process within a utility. Purchases of Metretek's products are, to a substantial
extent, deferrable in the event that utilities reduce capital expenditures as a
result of mergers and acquisitions, pending or unfavorable regulatory decisions,
poor revenues due to weather conditions, rising interest rates or general
economic downturns, among other factors.
Based upon the discussion and analysis in this item, we believe that
our future revenues, expenses and results of operations are likely to vary
significantly from quarter to quarter. As a result, quarterly comparisons of
operating results are not necessarily meaningful or indicative of future
performance.
15
<PAGE> 16
FINANCIAL CONDITION AND LIQUIDITY
We require capital principally for (i) the financing of inventory and
accounts receivable, (ii) research and development expenses, including the
development of PowerSpring, (iii) capital expenditures for property and
equipment and software development, and (iv) the funding of possible future
acquisitions.
Net cash used by operating activities of approximately $5,765,000 for
the six months ended June 30, 2000, was the net result of the following: (i)
approximately $8,135,000 of cash used to fund continuing operations, before
changes in assets and liabilities; (ii) approximately $2,722,000 of cash
provided by changes in working capital and other asset and liability accounts;
and (iii) approximately $352,000 of cash used by discontinued operations.
We plan to continue and expand our research and development efforts to
enhance our existing products and services and to develop new products,
especially in the business of PowerSpring. We anticipate that our research and
development costs in 2000 will be approximately $11,000,000, of which $1,200,000
will relate to Metretek's business and $9,800,000 is expected to be incurred in
connection with further developing PowerSpring. Research and development
expenses in the amount of $7,332,439 were incurred in the six months ended June
30, 2000.
We anticipate capital expenditures in 2000 of approximately $3,200,000,
primarily for computer software and hardware purchased to support PowerSpring's
Internet-based business. Capital expenditures for the six months ended June 30,
2000 totaled $1,460,000.
On July 14, 2000, we gave a written notice of redemption to all holders
of our common stock purchase warrants ("Warrants") that were issued in a
dividend in September 1998 to holders of our Common Stock. We have exercised our
right to redeem all Warrants that remain outstanding and unexercised at 5:00
p.m., Denver, Colorado time, on Monday, August 14, 2000 (the "Redemption Date").
The Warrants, which currently trade on the Nasdaq SmallCap Market under the
symbol "MTEKW", will cease trading after the Redemption Date. Until 5:00 p.m.,
Denver, Colorado time, on the Redemption Date, each Warrant will remain
exercisable for one share of Common Stock at an exercise price of $4.00 per
share. Thereafter, the Warrants will cease to be exercisable and holders thereof
will be entitled to only the redemption price of $.01 per Warrant.
As of July 14, 2000, the date we gave the Notice of Redemption, 839,675
Warrants were outstanding. The net proceeds that we will receive from the
exercise of Warrants on or before the Redemption Date will not be determinable
until the Redemption Date, because the proceeds that we will receive will be due
to the exercise of Warrants on or before the Redemption Date, which is in the
discretion of the Warrant holders. However, if all 839,675 outstanding Warrants
called for redemption are exercised, we estimate the net proceeds we would
receive from those exercises
16
<PAGE> 17
would be approximately $3,170,000, after deducting estimated commissions and
offering expenses. We intend to use the net proceeds primarily to fund the
development and expansion of the business of PowerSpring.
On February 4, 2000, we completed the $14,000,000 Units Private
Placement by issuing 7,000 Units, including 1,450 Units we issued on December 9,
1999. Each Unit consisted of 200 shares of Common Stock, 1 share of Series B
Preferred Stock and Unit Warrants to purchase 100 shares of Common Stock. In the
Units Private Placement, we issued 1,400,000 shares of Common Stock, 7,000
shares of Series B Preferred Stock and Unit Warrants to purchase 700,000 shares
of Common Stock. The Units Private Placement was approved and ratified by our
stockholders at a special meeting of stockholders held on February 3, 2000. The
Units were issued to institutional investors and other "accredited investors"
(as defined in Regulation D under the Securities Act). The primary purpose of
the Units Private Placement was to raise capital to enable us to develop the
Internet-based business of PowerSpring. A portion of the proceeds was also used
to repay outstanding indebtedness, and the remaining proceeds will be used for
general corporate and working capital purposes, including potentially providing
the funds to finance an acquisition opportunity, if one were to arise.
On March 17, 2000, we acquired Mercator Energy Incorporated through a
merger of Mercator with a wholly owned subsidiary of PowerSpring. Mercator is a
Denver-based natural gas services and brokerage company that acts as an
independent broker-agent for both producers and consumers of natural gas. In
consideration for the acquisition of Mercator, we delivered to John A. Harpole,
the President and sole shareholder of Mercator prior to the acquisition,
$408,334 in cash, a $741,666 non-negotiable promissory note payable by
PowerSpring over two years and secured by a general security interest in the
assets of PowerSpring, and 2,500,000 shares of Common Stock of PowerSpring.
Subsequent to the acquisition of Mercator, we own 87.5% of the outstanding
shares of PowerSpring Common Stock, Mr. Harpole owns 12.5% of the outstanding
shares of PowerSpring Common Stock, and Mercator has become a wholly owned
subsidiary of PowerSpring. We, PowerSpring and Mr. Harpole entered into a
stockholders agreement that addresses certain rights related to Mr. Harpole's
PowerSpring Common Stock, including a right for Mr. Harpole to put his shares of
PowerSpring Common Stock back to PowerSpring at an appraised value for each
payable over three years if PowerSpring has not completed an initial public
offering or has not sold its business within two years. PowerSpring also entered
into a two-year employment agreement with Mr. Harpole, who will serve as the
Executive Vice President, Chief Operating Officer and a director of PowerSpring.
Under the employment agreement, Mr. Harpole received an option to purchase
60,000 shares of our Common Stock, exercisable at $17.88 per share, and an
option to purchase 200,000 shares of PowerSpring Common Stock, exercisable at
$.30 per share.
17
<PAGE> 18
On September 13, 1999, we entered into a consulting and joint venture
agreement with Mercator, under which Mercator provided its energy procurement
services to us on a consulting basis. In connection with our acquisition of
Mercator, we issued to Mercator a warrant to purchase 60,000 shares of Common
Stock. The Mercator warrant vests in three tranches from the date of issuance
through March 2001, with exercise prices ranging between $4.50 and $5.50 per
share, and expires in September 2002. Mercator has registration rights with
respect to the Common Stock issuable upon the exercise of the Mercator warrant.
In connection with our acquisition of Mercator, the consulting agreement, and a
related stock option agreement between TotalPlan and Mercator, were terminated,
and Mercator transferred the Mercator warrant to Mr. Harpole.
On April 14, 1998, we entered into a loan and security agreement (the
"Loan Agreement") with a commercial bank (the "Lender") providing for a combined
$5,000,000 credit facility consisting of loans (the "Loans") and letters of
credit subject to limitations described below. The Loan Agreement provides for
daily advances in the form of Loans to fund capital requirements, and daily
paydowns on outstanding balances of the Loans from collection of customer
accounts receivable. We make monthly interest payments computed at prime plus 1%
(9.5% at June 30, 2000) on outstanding balances of the Loans. The Loans mature
on March 14, 2001.
The Loans are secured by our tangible and intangible assets, including
the equipment, inventory, receivables and cash deposits, and the pledge of the
shares of our subsidiaries. The Loan Agreement requires us to maintain a minimum
tangible net worth, a maximum debt to tangible net worth ratio, minimum annual
net income, a minimum debt service coverage ratio, and contains other standard
covenants related to our operations, including prohibitions on the payment of
dividends and the issuance or repurchase of securities (with certain exceptions)
without the Lender's consent.
Borrowings on the Loans are limited to the sum of 80% of eligible
accounts receivable of Southern Flow and Metretek and 50% of raw materials and
finished goods inventory (up to a combined maximum of $1,500,000) of Southern
Flow and Metretek. At June 30, 2000, we had a combined $3,374,682 in Loan
availability, none of which had been borrowed.
On May 4, 1998, we acquired substantially all of the assets and
business of a subsidiary of American Meter Company pertaining to electronic
correctors and non-radio-frequency meter reading devices in the natural gas and
electric utility industry. In consideration for this purchase, we delivered to
American Meter an aggregate purchase price consisting of $1,300,000 in cash,
439,560 unregistered shares of Common Stock, and a $600,000 convertible
subordinated promissory note. In April 2000, American Meter converted the note
into 105,495 shares of Common Stock under the terms of the note. Until it was
converted, the note bore interest on the unpaid principal balance at a fixed
rate equal to 7.5% per annum, payable quarterly in arrears, and was due and
payable on May 4, 2002.
18
<PAGE> 19
On September 13, 1999, we entered into a strategic relationship with
Scient to assist us in designing and creating an Internet-based business to
enable us to take its measurement information products, services, and data
measurement technologies to the market of end-users of natural gas and
electricity. The Internet project is being developed and operated through
PowerSpring. In connection with the development of PowerSpring, we issued to
Scient a warrant to purchase 125,000 shares of Common Stock. The Scient Warrant
becomes exercisable in September 2000, at exercise prices split between $5.00
and $10.00 per share, and expires in September 2002. Scient has registration
rights with respect to the Common Stock issuable upon the exercise of the Scient
warrant.
We estimate that this initial development phase and launch of
PowerSpring will require aggregate expenditures of approximately $12.0 million,
consisting primarily of research and development costs, consulting fees and
expenses and costs of acquiring the requisite technology, including hardware and
software. Through June 30, 2000, these costs were approximately $8.1 million.
Compensation expense for the fair value of the Scient, Mercator and
Lender warrants is being recognized in accordance with the provisions of
Statement of Financial Accounting Standards No. 123 "Accounting for Stock-Based
Compensation," over the period in which the services are being performed or the
remaining term of the Loan Agreement. Compensation expense associated with the
warrants in the amount of $66,387 has been recognized in the consolidated
statement of operations during the six months ended June 30, 2000.
Based on our current plans and assumptions, management believes that
our capital resources, including cash and cash equivalents, amounts available
under existing credit facilities and funds generated from operations will be
sufficient to meet our currently anticipated cash needs, including our working
capital needs, capital commitments and debt service requirements. However, we
will have a continuing need for additional capital to accomplish our business
strategy with respect to the growth of our existing businesses. The continued
development and expense of the business of PowerSpring, subsequent to the June
2000 launch of PowerSpring's website, will also require significant additional
capital. In addition, unanticipated events, over which we may have no control,
could increase our operating costs or decrease our ability to generate revenues
from product and service sales. We will also require additional capital in the
future in order to make any significant acquisition of businesses or
technologies.
We expect that after the initial development stage of PowerSpring is
completed, the further development and growth of PowerSpring, including
staffing, organizational expenses, marketing costs and additional capital
expenditures, will require significant additional funds from the proceeds of
public or private equity financing, debt financing or from other sources. We
intend to raise any needed additional capital to fund the development and
operations of PowerSpring primarily through financing at the PowerSpring level.
However, depending upon
19
<PAGE> 20
the availability of capital, market conditions, our consolidated operations and
the operations of PowerSpring, we may also or instead raise additional capital
at the Metretek level. For example, the net proceeds of the warrant call
discussed above will be primarily used to fund PowerSpring.
Obtaining additional financing will depend on many factors, including
market conditions, our operating performance and investor sentiment. Terms of
debt financing could restrict our ability to operate our business or to expand
our operations. In addition, if we raise additional capital by issuing capital
stock or securities convertible into capital stock, stockholders could suffer a
significant dilution of their percentage ownership interests, and the new
capital stock or other new securities could have rights, preferences or
privileges senior to those of our current stockholders.
Our capital raising will be subject to the consent of the Lender, if
our credit facility is then in effect. In addition, depending on how it is
structured, any capital raising could require the consent of the holders of our
Series B Preferred Stock. We cannot assure you that sufficient additional funds
will be available to us on a timely basis or that, if available on a timely
basis, such funds can be obtained on terms satisfactory to us, to the Lender and
to the holders of our Series B Preferred Stock, if their consents are required.
Our inability to obtain sufficient additional capital on a timely basis on terms
that are acceptable could have a material adverse effect on our business,
financial condition and results of operations.
RECENT ACCOUNTING PRONOUNCEMENTS
In June 1998, the Financial Accounting Standards Board issued Financial
Accounting Standards Statement No. 133, "Accounting for Derivative Instruments
and Hedging Activities" ("FAS 133"). FAS 133 establishes methods of accounting
for derivative financial instruments and hedging activities related to those
instruments as well as other hedging activities. We will be required to adopt
FAS 133 for our fiscal year ending December 31, 2001. However, because we do not
utilize derivative financial instruments, we do not believe the impact of FAS
133 will be material to our financial position or results of operations.
In December 1998, the AICPA issued Statement of Position 98-9,
"Modification of SOP 97-2, Software Revenue Recognition, With Respect to Certain
Transactions" ("SOP 98-9"). SOP 98-9 requires use of the "residual method" for
recognition of revenue when vendor-specific objective evidence exists for
undelivered elements but does not exist for delivered elements of a software
arrangement. We were required to comply with the provisions of SOP 98-9 for
transactions entered into beginning January 1, 2000. The adoption of SOP 98-9
did not have a material effect on our financial position or results of
operations.
20
<PAGE> 21
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Form 10-QSB contains, under this item, as well as other parts of
this Form 10-QSB, forward-looking statements within the meaning of and made
under the safe harbor provisions of Section 27A of the Securities Act of 1933,
as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.
From time to time, we may publish or otherwise make available forward-looking
statements of this nature. Forward-looking statements include statements
concerning plans, objectives, goals, strategies, future events or performance,
and underlying assumptions and other statements, which are not historical facts.
The words "may", "could", "should", "will", "project", "intend", "continue",
"believe", "anticipate", "estimate", "expect", "plan", "intend", "potential", or
"scheduled" and similar expressions are intended to identify forward-looking
statements. Examples of forward-looking statements include statements regarding,
among other matters, our plans, intentions, beliefs and expectations with
respect to the following:
- our future prospects, including our revenues, income, margins,
profitability, cash flow, liquidity, financial condition and results
of operations;
- the sufficiency of funds from operations and available borrowings to
meet our future working capital and capital expenditure needs;
- our ability to successfully develop, implement and operate
PowerSpring, including to design, develop and sell our products and
services over the Internet and achieve our Internet-based business
objectives;
- our ability to finance PowerSpring;
- our business trends and strategies;
- our products and services, market position, market share, business and
growth strategies, and strategic relationships; and
- industry trends, competitive conditions and market conditions,
segments and trends.
The forward-looking statements are based on the current plans,
intentions, beliefs and expectations of management as well as assumptions made
by and information currently available to management. You are cautioned not to
place undue reliance on these forward-looking statements. Forward-looking
statements are not guarantees of future performance or events, but are subject
to and qualified by substantial risks and uncertainties that could cause actual
results to differ materially from those expressed or implied by the
forward-looking statements. These risks and uncertainties include, but are not
limited to, the following:
21
<PAGE> 22
- our ability to successfully develop, implement and market PowerSpring
and its products and services;
- the emergence and growth of a viable market for online energy
information and services;
- the success of our acquisition of Mercator;
- changes in the energy industry in general and the natural gas and
electricity industry in particular;
- our ability to raise sufficient funds to finance PowerSpring and our
other capital requirements on terms satisfactory to us, and the
willingness of the Lender and any other persons required to consent to
the terms of such financing arrangements;
- our history of losses and uncertainty of future profitability;
- our lack of operating history in our new energy information and
services businesses and the unproven business models in those
businesses;
- the willingness of energy users to accept the Internet as a medium for
energy commerce;
- the development and maintenance of the Internet infrastructure, and
the security and confidentiality of transactions on the Internet;
- our ability to manage the anticipated growth of PowerSpring;
- the capital resources, technological requirements, and internal
business plans of the natural gas and electricity utilities industry;
- restrictions on our capital raising ability imposed by the terms of
our current credit facility and the Series B Preferred Stock;
- dividends on the Series B Preferred Stock increasing our future net
loss available to common shareholders and net loss per share;
- technological and market changes within the natural gas and
electricity industries;
- the complexity, uncertainty and time constraints associated with the
development and market acceptance of new product and service designs
and technologies;
- general economic and business conditions;
22
<PAGE> 23
- our ability to successfully integrate and utilize any product lines
and business acquired in future acquisitions, including the risks that
revenues from the acquired business could be lower than expected and
that related costs could be higher than expected;
- the impact and timing of the deregulation of the various energy
markets;
- utility purchasing patterns and delays and potential changes to the
federal and state regulatory frameworks within which the utility
industry operates;
- fluctuations in our quarterly operating results;
- effects of a change in product mix on our expected gross margins and
net income;
- risks inherent in international operations;
- risks associated with our management of private energy programs;
- the receipt and timing of future customer orders;
- the effects of competition in our market including the introduction of
competitor products, services and technologies;
- unexpected events affecting our ability to obtain funds from
operations, debt or equity to finance operations, pay interest and
other obligations, and fund needed capital expenditures and other
investments;
- our ability to protect our proprietary information and technology;
- the impact of current and future laws and government regulations
affecting the energy industry in general and the natural gas and
electricity industries in particular; and
- other risks and uncertainties that are discussed in this report or
that are discussed from time to time in our other reports and filings
with the SEC.
We do not intend, and we undertake no duty or obligation, to update or
revise any forward-looking statements for any reason, whether as the result of
new information, further events or otherwise.
23
<PAGE> 24
PART II
OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
On July 14, 2000, we gave a written notice of redemption to all holders
of our common stock purchase warrants ("Warrants") that were issued in a
dividend in September 1998 to holders of our common stock. We have exercised our
right to redeem all Warrants that remain outstanding and unexercised at 5:00
p.m., Denver, Colorado time, on Monday, August 14, 2000 (the "Redemption Date").
The Warrants, which currently trade on the Nasdaq SmallCap Market under the
symbol "MTEKW", will cease trading after the Redemption Date. Until 5:00 p.m.,
Denver, Colorado time, on the Redemption Date, each Warrant will remain
exercisable for one share of Common Stock at an exercise price of $4.00 per
share. Thereafter, the Warrants will cease to be exercisable and holders thereof
will be entitled to only the redemption price of $.01 per Warrant.
We have entered into a Dealer Manager Agreement with Stifel, Nicolaus &
Company, Inc. ("Stifel"), pursuant to which Stifel has agreed to serve as the
dealer manager in connection with the redemption. Under the terms of the Dealer
Manager Agreement and in consideration of Stifel's obligations under that
agreement, we agreed to pay Stifel an initial consulting fee of $25,000, plus a
commission of $.15 per Warrant exercised to the extent such amount exceed
$25,000. We also agreed to reimburse Stifel for up to $20,000 of its reasonable
out-of-pocket expenses and legal fees, in connection with the redemption.
As of July 14, 2000, the date we gave the Notice of Redemption, 839,675
Warrants were outstanding. The net proceeds that we will receive from the
exercise of Warrants on or before the Redemption Date will not be determinable
until the Redemption Date, because the proceeds that we will receive will be due
to the exercise of Warrants on or before the Redemption Date, which is in the
discretion of the Warrant holders. However, if all 839,675 outstanding Warrants
called for redemption are exercised, we estimate the net proceeds we would
receive from those exercises would be approximately $3,170,000, after deducting
estimated commissions and offering expenses. We intend to use the net proceeds
primarily to fund the development and expansion of the business of PowerSpring.
24
<PAGE> 25
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At our annual meeting of stockholders, held on June 15, 2000, the
following proposals were submitted to and approved by our stockholders:
Proposal 1: To elect two directors, each for a three year term expiring at
the 2003 Annual Meeting of Stockholders.
FOR WITHHOLD
--- --------
Stephen E. McGregor 4,352,814 8,938
Anthony D. Pell 4,352,814 8,938
Proposal 2: To ratify the appointment by the Board of Directors of
Deloitte & Touche LLP as our independent auditors for the
fiscal year ending December 31, 2000.
FOR AGAINST ABSTAIN
--- ------- -------
4,356,452 1,800 3,500
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
27.1 Financial Data Schedule
(b) REPORTS ON FORM 8-K
Since March 31, 2000, we filed the following Current
Reports on Form 8-K with the Securities and Exchange Commission:
Filing Date Item No. Description
----------- -------- -----------
April 3, 2000 2, 7 Acquisition of Mercator Energy Incorporated
July 14, 2000 5, 7 Notice of Warrant Redemption
25
<PAGE> 26
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of
1934, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
METRETEK TECHNOLOGIES, INC.
Date: August 11, 2000 By: /s/ W. Phillip Marcum
-------------------------------------
W. Phillip Marcum
President and Chief Executive Officer
Date: August 11, 2000 By: /s/ A. Bradley Gabbard
-------------------------------------
A. Bradley Gabbard
Executive Vice President
and Chief Financial Officer
26
