SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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): June 25, 2003
VALENCE TECHNOLOGY, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 0-20028 77-0214673
(State of Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
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6504 Bridge Point Parkway, Suite 415
Austin, Texas 78730
(Address of Principal Executive Offices)
(512) 527-2900
(Registrant's Telephone Number, Including Area Code)
ITEM 5. OTHER EVENTS AND REQUIRED FD DISCLOSURE
Reference is made to the press releases of Registrant issued on June 25, 2003, July 21, 2003 and August 13, 2003, each of which is incorporated herein by this reference. Copies of the press releases are attached to this Form 8-K as Exhibits 99.1, 99.2, and 99.3.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits.
99.1 Press Release dated June 25, 2003.
99.2 Press Release dated July 21, 2003.
99.3 Press Release dated August 13, 2003.
99.4 Press Release dated August 13, 2003
ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION
Reference is made to the first fiscal quarter results press release of Registrant issued on August 13, 2003, which is incorporated herein by this reference. A copy of the press release is attached to this Form 8-K as Exhibit 99.4.
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.
August 14, 2003 VALENCE TECHNOLOGY, INC.
By: /s/ Kevin W. MIschnick
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Kevin W. Mischnick
Vice President of Finance
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EXHIBIT INDEX
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EXHIBITS
99.1 Press Release dated June 25, 2003. 99.2 Press Release dated July 21, 2003. 99.3 Press Release dated August 13, 2003. 99.4 Press Release dated August 13, 2003. |
VALENCE AND D&H DISTRIBUTING SIGN VENDOR AGREEMENT
VALENCE'S N-CHARGE(TM) POWER SYSTEM TO BE AVAILABLE THROUGH D&H
AUSTIN, TX, JUNE 25, 2003 -- Valence Technology, Inc. (NASDAQ: VLNC), a leader in the development and commercialization of Saphion(TM) technology and Lithium-ion polymer rechargeable batteries, and D&H Distributing, a leading national computer products distributor, today announced that they have reached an agreement to distribute Valence's N-Charge(TM) Power System.
"D&H has a proven track record with its partners and an expansive distribution network to market segments that we feel are appropriate targets for our N-Charge product," stated Stephan Godevais, chairman and CEO of Valence. "We were seeking a distribution partner to help us penetrate certain markets, and with its specialized and dedicated sales force, D&H was the right choice."
"As mobility and power availability continue to be a top priority in a variety of sectors, we have seen a great need for a product like Valence's N-Charge Power System," stated Rick Prayer, senior buyer for D&H Distributing. "We strive to bring our customers the latest and most advanced technology solutions, and the N-Charge system definitely fits into this category."
ABOUT VALENCE TECHNOLOGY, INC.
Valence is a leader in the development and commercialization of Saphion(TM) technology and Lithium-ion polymer rechargeable batteries. Valence holds an extensive, worldwide portfolio of issued and pending patents relating to its Saphion(TM) technology and Lithium-ion polymer rechargeable batteries. The company has facilities in Austin, Texas, Henderson, Nevada and Mallusk, Northern Ireland. Valence is traded on the NASDAQ SmallCap Market under the symbol VLNC and can be found on the Internet at WWW.VALENCE.COM.
ABOUT D&H DISTRIBUTING
One of America's largest wholesale distributors of microcomputer products, consumer electronics, educational products and security products, D&H has been distributing to the reseller and solution provider community for more than 84 years. D&H leads the computer industry in emerging technologies and is known for providing every solution
provider -- from large, national accounts to small, independent business owners -- with top-quality products, competitive prices and highly personalized service. For the second year running, D&H has been ranked highest in overall performance among the distributors evaluated in CRN magazine's 18th Annual Sourcing Study. D&H Distributing is headquartered in Harrisburg, PA, with shipping locations in Harrisburg, Boston, Ft. Lauderdale, Chicago, Dallas and Visalia, CA. For more information on D&H, call toll-free, (800) 340-1001, or visit the company's Web site at www.dandh.com.
FORWARD-LOOKING STATEMENT
The information contained herein includes "forward-looking statements." The company cautions readers not to put undue reliance on forward-looking statements. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ materially from those described herein, for the reasons, among others, discussed in our reports filed with the Securities and Exchange Commission.
MEDIA CONTACT INVESTOR CONTACT Blanc and Otus Public Relations Valence Technology Sue Ellen M. Schaming Kevin Mischnick SSCHAMING@BLANCANDOTUS.COM Vice President of Finance (415) 856-5129 (512) 527-2900 |
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BUSINESS LICENSE GRANTED TO VALENCE AND FENGFAN JOINT VENTURE
BAODING FENGFAN-VALENCE BATTERY COMPANY LTD. TO COMMENCE OPERATIONS IMMEDIATELY
AUSTIN, TX, JULY 21, 2003 -- Valence Technology, Inc. (NASDAQ: VLNC), a leader in the development and commercialization of Saphion(TM)technology and Lithium-ion polymer rechargeable batteries, today announced that Baoding Fengfan-Valence Battery Company Ltd., a joint venture formed between it and FengFan Group, Ltd., has been granted a business license for operations in China.
The newly established Baoding Fengfan-Valence Battery Company Ltd. will manufacture Saphion(TM) Lithium-ion batteries for distribution worldwide. Under the terms of the joint venture agreement, Valence will contribute capital equipment, technology and engineering expertise. FengFan will provide the cash required to fund the joint venture for the first two years as well as the land and facility needed for manufacturing operations.
"Over the past few months, FengFan has demonstrated that it is truly a leading battery manufacturer in terms of both management and production capabilities, and we are eager to begin operations as a joint venture company," stated Stephan Godevais, chairman and CEO of Valence. "For Valence, the approval of this business license represents a critical step forward in our low cost manufacturing strategy, and we are pleased to have FengFan as a partner."
"In Saphion technology, Valence has developed a cutting-edge battery chemistry with safety advantages that enable the development of large format Lithium-ion energy solutions, " stated Mr. Chen Ming Li, chairman and president of the FengFan Group Ltd. "Our joint venture company will pioneer the manufacture of these solutions and bring to market the most advanced Lithium-ion technology available today."
The joint venture company will be located in the Baoding National High Technology Industrial Development Zone in the City of Baoding, southwest of Beijing.
ABOUT VALENCE TECHNOLOGY, INC.
Valence is a leader in the development and commercialization of Saphion(TM) technology and Lithium-ion polymer rechargeable batteries. Valence holds an extensive, worldwide portfolio of issued and pending patents relating to its Saphion(TM) technology and Lithium-ion polymer rechargeable batteries. The company has facilities in Austin, Texas, Henderson, Nevada and Mallusk, Northern Ireland. Valence is traded on the NASDAQ
SmallCap Market under the symbol VLNC and can be found on the Internet at
WWW.VALENCE.COM.
ABOUT FENGFAN CO., LTD.
FengFan is the leading manufacturer of high performance, maintenance-free sealed batteries for cars, motorcycles and industrial applications in China with a forty-four year history of product development and sales. FengFan's "Sail" line of batteries is acknowledged as the leading product in its category by the Chinese State Bureau of Commerce and Technology and is exported to over 20 countries worldwide. It is the leading OEM vendor to major automobile manufacturers including Shanghai Volkswagen, FAW-VW, Dongfeng Citroen Automobile, Beijing Cherokee, Nanjing Iveco, Steyr of China Heavy Duty Trucks and Tianjin Charade. The company is headquartered in Baoding, China.
FORWARD-LOOKING STATEMENT
The information contained herein includes "forward-looking statements." The company cautions readers not to put undue reliance on forward-looking statements. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ materially from those described herein, for the reasons, among others, discussed in our reports filed with the Securities and Exchange Commission.
MEDIA CONTACT INVESTOR CONTACT Blanc and Otus Public Relations Valence Technology Sue Ellen M. Schaming Kevin Mischnick SSCHAMING@BLANCANDOTUS.COM Vice President of Finance (415) 856-5129 (512) 527-2900 |
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VALENCE TO TRANSFER MANUFACTURING OPERATIONS FROM NORTHERN IRELAND TO CHINA
AUSTIN, TX, AUGUST 13, 2003 -- Valence Technology, Inc. (NASDAQ: VLNC), a leader in the development and commercialization of Saphion(TM) technology and Lithium-ion polymer rechargeable batteries, today announced its plan to transfer manufacturing operations from its Northern Ireland facility to China.
"The efforts of the local team in Northern Ireland have been tremendous, and we greatly appreciate the work they have accomplished over the years," stated Stephan Godevais, chairman and CEO of Valence. "Despite our desire to find appropriate business opportunities for the factory, our partnerships in China have proven to be far more cost effective."
The transfer is expected to take place over the next three months. The Company will maintain a presence in Northern Ireland to support its contract manufacturing partnership with ATL, which has begun production of Saphion(TM) cells for use in the N-Charge(TM) Power System and Valence's joint venture company, Baoding Fengfan-Valence Battery Company Ltd., which was formed in July. The team in Northern Ireland also will manage European sales and marketing activities.
ABOUT VALENCE TECHNOLOGY, INC.
Valence is a leader in the development and commercialization of Saphion(TM) technology and Lithium-ion polymer rechargeable batteries. Valence holds an extensive, worldwide portfolio of issued and pending patents relating to its Saphion(TM) technology and Lithium-ion polymer rechargeable batteries. The company has facilities in Austin, Texas, Henderson, Nevada and Mallusk, Northern Ireland. Valence is traded on the NASDAQ SmallCap Market under the symbol VLNC and can be found on the Internet at WWW.VALENCE.COM.
FORWARD-LOOKING STATEMENT
The information contained herein includes "forward-looking statements." The company cautions readers not to put undue reliance on forward-looking statements. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ materially from those described herein, for
the reasons, among others, discussed in our reports filed with the Securities and Exchange Commission.
MEDIA CONTACT INVESTOR CONTACT Blanc and Otus Public Relations Valence Technology Sue Ellen M. Schaming Kevin Mischnick SSCHAMING@BLANCANDOTUS.COM Vice President of Finance (415) 856-5129 (512) 527-2900 |
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VALENCE REPORTS FIRST QUARTER FY 2004 RESULTS
TRANSFER OF MANUFACTURING OPERATIONS TO CHINA TO RESULT IN DRAMATIC COST SAVINGS
AUSTIN, TX, AUGUST 13, 2003 -- Valence Technology, Inc. (NASDAQ: VLNC), a leader in the development and commercialization of Saphion(TM) technology and Lithium-ion polymer rechargeable batteries, today reported results for its first quarter of fiscal year 2004 ended June 30, 2003.
The Company reported $1.6 million in revenue for its first quarter of fiscal year 2004, representing a 220% increase over $509 thousand in its first quarter of 2003, and an increase of 41.8% from $1.2 million in its fourth quarter of 2003. In addition, $1.4 million in shipments was recorded as deferred revenue and will be recognized as revenue over the upcoming months. The Company reported a net loss of $9.5 million, or $.13 per basic and diluted share, compared to a net loss of $9.7 million, or $.19 per basic and diluted share, in its first quarter of 2003, and a net loss of $10.1 million, or $.13 cents per basic and diluted share, in its fourth quarter of 2003.
"Our first quarter was marked by continued solid progress in all areas of our business, " stated Stephan Godevais, chairman and CEO of Valence. "Sales of the N-Charge(TM) are increasing at a steady rate, as a result of our traction with national retail chains and Tier One customers. We have reached key milestones in the implementation of our low cost manufacturing strategy and have made significant progress in the development of our future technologies. We expect these major steps forward to have a positive impact on the future of our business."
Valence also announced today that as a result of the progress and significant cost savings offered by its manufacturing partners, it plans to transfer manufacturing operations from the Mallusk, Northern Ireland facility to China. "In addition to reducing our per unit manufacturing costs by over 50%, this transfer will significantly reduce our quarterly cash burn and working capital requirements," added Stephan Godevais.
In connection with this transfer, the Company will record a non-cash charge in the range of $13.0 to $15.0 million related to the write-down of certain assets in the quarter ending September 30, 2003. The Company will record an additional $3.0 million liability for the expected termination of the Letter of Offer with Invest Northern Ireland (INI). The liability recorded for the INI will be discharged using restricted common stock over a three-year period beginning March 31, 2004. The terms of the arrangement preclude the INI from short selling the common stock at any time and restrict trading of the stock for a period of one year. The termination of the Letter of Offer will release the Company from any restrictions including the sale or transfer of its equipment.
ABOUT VALENCE TECHNOLOGY, INC.
Valence is a leader in the development and commercialization of Saphion(TM) technology and Lithium-ion polymer rechargeable batteries. Valence holds an extensive, worldwide portfolio of issued and pending patents relating to its Saphion(TM) technology and Lithium-ion polymer rechargeable batteries. The company has facilities in Austin, Texas, Henderson, Nevada and Mallusk, Northern Ireland. Valence is traded on the NASDAQ SmallCap Market under the symbol VLNC and can be found on the Internet at WWW.VALENCE.COM.
FORWARD-LOOKING STATEMENT
The information contained herein includes "forward-looking statements." The company cautions readers not to put undue reliance on forward-looking statements. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ materially from those described herein, for the reasons, among others, discussed in our reports filed with the Securities and Exchange Commission.
MEDIA CONTACT INVESTOR CONTACT Blanc and Otus Public Relations Valence Technology Sue Ellen M. Schaming Kevin Mischnick SSCHAMING@BLANCANDOTUS.COM Vice President of Finance (415) 856-5129 (512) 527-2900 |
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VALENCE TECHNOLOGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
(unaudited)
June 30, 2003 March 31, 2003
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ASSETS
Current assets:
Cash and cash equivalents $ 8,667 $ 6,616
Trade receivables, net of allowance of $130 and $130
as of June 30, 2003 and March 31, 2003, respectively 805 1,218
Inventory 4,907 2,757
Prepaid and other current assets 1,344 1,495
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Total current assets 15,723 12,086
Property, plant and equipment, net 14,405 14,279
Intellectual property, net 9,427 9,789
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Total assets $ 39,555 $ 36,154
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Current portion of long-term debt $ 852 $ 810
Accounts payable 3,173 3,511
Accrued expenses 2,634 2,013
Deferred revenue 1,452 14
Grant payable 1,797 1,715
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Total current liabilities 9,908 8,063
Long-term interest 7,483 6,744
Long-term debt, less current portion 5,725 5,623
Long-term debt to stockholder 33,419 33,242
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Total liabilities 56,535 53,672
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Commitments and contingencies
Stockholders' equity (deficit):
Preferred stock, $0.001 par value, authorized, issued and
outstanding 1,000 shares at June 30, 2003 8,577 -
Common stock, $0.001 par value, authorized: 100,000,000 shares,
issued and outstanding: 71,734,022 and 71,722,794 shares
at June 30, 2003 and March 31, 2003, respectively 72 72
Additional paid-in capital 367,762 366,518
Deferred compensation (212) (181)
Notes receivable from stockholder (4,953) (5,161)
Accumulated deficit (384,109) (374,604)
Accumulated other comprehensive loss (4,117) (4,162)
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Total stockholders' equity (deficit) (16,980) (17,518)
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Total liabililities and stockholders $ 39,555 $ 36,154
equity (deficit) =============== =================
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The accompanying notes are an integral part of these condensed consolidated financial statements.
VALENCE TECHNOLOGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(in thousands, except per share amounts)
(unaudited)
Three Months Ended
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June 30, 2003 June 30, 2002
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Revenue:
Licensing and royalty revenue $ 556 $ 1
Battery and system sales 1,075 508
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Total revenues 1,631 509
Cost of sales: 3,818 2,522
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Gross profit (loss) (2,187) (2,013)
Operating expenses:
Research and product development 2,056 2,798
Marketing 958 783
General and administrative 2,468 2,413
Depreciation and amortization 788 645
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Total costs and expenses 6,270 6,639
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Operating loss (8,457) (8,652)
Interest and other income 80 116
Interest expense (1,112) (1,123)
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Net loss (9,489) (9,659)
Preferred stock dividends accrued 16
Net loss available to common
stockholders $ (9,505) $ (9,659)
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Other comprehensive loss:
Net loss $ (9,489) $ (9,659)
Change in foreign currency
translation adjustments 45 60
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Comprehensive loss $ (9,444) $ (9,599)
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Net loss per share $ (0.13) $ (0.19)
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Net loss per share available to
common stockholders $ (0.13) $ (0.19)
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Shares used in computing net
loss per share available
to common stockholders,
basic and diluted 71,728 51,488
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The accompanying notes are an integral part of these condensed consolidated financial statements.