-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ss5WPFlnLbDXZAnUmBOryKPoQhWMpt/NZQjYyLC8+XnR/l56ObO8+P1bkCFK4Lrx uzC80yTMcssQoS2EDenorA== 0001004522-97-000090.txt : 19971117 0001004522-97-000090.hdr.sgml : 19971117 ACCESSION NUMBER: 0001004522-97-000090 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970930 FILED AS OF DATE: 19971114 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: MPM TECHNOLOGIES INC CENTRAL INDEX KEY: 0000799268 STANDARD INDUSTRIAL CLASSIFICATION: GOLD & SILVER ORES [1040] IRS NUMBER: 810436060 STATE OF INCORPORATION: WA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-14910 FILM NUMBER: 97717885 BUSINESS ADDRESS: STREET 1: 222 W MISSION AVE STREET 2: STE 30 CITY: SPOKANE STATE: WA ZIP: 99201 BUSINESS PHONE: 5093263443 MAIL ADDRESS: STREET 1: 908 N HOWARD SUITE 100 STREET 2: 908 N HOWARD SUITE 100 CITY: SPOKANE STATE: WA ZIP: 99201 FORMER COMPANY: FORMER CONFORMED NAME: MONTANA PRECISION MINING LTD DATE OF NAME CHANGE: 19920703 10QSB 1 FORM 10-QSB SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For Quarter Ended: September 30, 1997 Commission File Number: 0-14910 ------------------- --------- MPM TECHNOLOGIES, INC. ---------------------------------------------------- (Exact name of registrant as specified in its charter) Washington 81-0436060 - --------------------------------- ------------------------ (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 222 West Mission, Ste 30 Spokane, WA 99201-2347 ------------------------- ----------------- (Address of principal (Zip Code) executive offices) Registrant's telephone number, including area code: (509) 326-3443 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 November 3, 1997, the registrant had outstanding 16,459,404 shares of common stock which is the registrant's only class of stock. PART 1 - FINANCIAL INFORMATION Item 1. Financial Statements Financial Statements follow on the next page. MPM TECHNOLOGIES, INC. AND SUBSIDIARIES Spokane, Washington Financial Statements September 30, 1997, and December 31, 1996
MPM TECHNOLOGIES, INC. Consolidated Statement of Financial AND SUBSIDIARIES Position as of September 30, 1997, and December 31, 1996 - ------------------------------------------------------------------------------------------------- UNAUDITED ASSETS September December 30, 1997 31, 1996 -------------- -------------- CURRENT ASSETS Cash (Note 2) $ 886,720 $ 40,566 Receivables, net of allowance for doubtful accounts of $180,902 2,305,245 37,017 Inventory 650,056 Other current assets 20,141 1,438 -------------- -------------- Total current assets 3,862,162 79,021 -------------- -------------- PROPERTY, PLANT AND EQUIPMENT (NOTE 2) Land 70,000 70,000 Mining claims (Note 3) 48,600 48,600 Mining leases (Notes 3 and 7) 5,437 5,437 Buildings 133,005 133,005 Mill machinery 289,063 289,063 Vehicles and equipment 253,740 117,630 Software 3,258 3,258 -------------- -------------- Total property, plant and equipment 803,103 666,993 Less accumulated depreciation 479,831 422,167 -------------- -------------- Net property, plant and equipment 323,272 244,826 -------------- -------------- OTHER ASSETS Deferred exploration and development costs (Note 1) 1,195,466 1,195,466 Investment (Note 1) 1,200,000 1,200,000 Notes receivable 275,000 275,000 Licenses, net of accumulated amortization of $5,347 and $4,595, respectively (Note 2) 28,741 29,494 Advance minimum royalties (Note 2) 50,750 50,750 Mineralized material in place (Note 3) 10 10 -------------- -------------- Total other assets 2,749,967 2,750,720 -------------- -------------- TOTAL ASSETS $ 6,935,401 $ 3,074,567 ============== ==============
The accompanying notes are an integral part of these financial statements. Page 4 of 12
MPM TECHNOLOGIES, INC. Consolidated Statement of Financial AND SUBSIDIARIES Position as of September 30, 1997 and December 31, 1996 - ----------------------------------------------------------------------------------------------------- UNAUDITED LIABILITIES AND STOCKHOLDERS' EQUITY September December 30, 1997 31, 1996 -------------- -------------- CURRENT LIABILITIES Accounts payable $ 1,147,045 $ 963 Interest payable - other 109 5,859 Interest payable - related parties (Note 4) 129,997 129,997 Notes payable - other (Note 4) 512,347 570,234 Notes payable - related parties (Note 4) 314,765 314,765 -------------- -------------- Total current liabilities 2,104,263 1,021,818 -------------- -------------- OTHER LIABILITIES Deferred credit 1,200,000 0 -------------- -------------- MINORITY INTEREST (NOTES 2 and 6) Minority interest in consolidated entities (742,594) (718,888) -------------- -------------- COMMITMENTS (NOTE 7) STOCKHOLDERS' EQUITY Common stock, $.001 par value, 50,000,000 shares authorized, 16,459,404 shares and 14,399,773 shares outstanding September 30, 1997, and December 31, 1996, respectively (Notes 1, 6 and 8) 16,459 14,399 Additional paid-in capital 9,067,459 7,417,996 Accumulated deficit (4,710,186) (4,660,758) -------------- -------------- Total stockholders' equity 4,373,732 2,771,637 -------------- -------------- TOTAL LIABILITIES, MINORITY INTEREST AND STOCKHOLDERS' EQUITY $ 6,935,401 $ 3,074,567 ============== ==============
The accompanying notes are an integral part of these financial statements. Page 5 of 12
MPM TECHNOLOGIES, INC. Consolidated Statement of Operations for the Quarters AND SUBSIDIARIES Ended September 30, 1996 and 1997, the Nine Month Periods Ended September 30, 1996 and 1997 - ----------------------------------------------------------------------------------------------------------------- UNAUDITED Quarter Ended Nine Months Ended September 30, September 30, 1997 1996 1997 1996 ----------- ----------- ----------- ----------- REVENUES Management fees - related party $ 35,451 $ -0- $ 48,000 $ -0- Sales of product and services 1,429,835 4,311,620 Sales of equipment ----------- ----------- ----------- ----------- Total revenues 1,465,286 0 4,359,620 0 ----------- ----------- ----------- ----------- COST OF REVENUES Cost of Sales 1,010,688 3,417,306 ----------- ----------- ----------- ----------- Gross profit 454,598 0 942,314 0 ----------- ----------- ----------- ----------- SELLING, GENERAL AND ADMINISTRATIVE EXPENSES Bank service fees 10 10 20 37 Contract labor 1,930 (18,605) 1,930 4,190 Depreciation and amortization 11,069 3,983 58,416 10,023 Dues and subscriptions 131 55 788 343 Equipment rental Freight Insurance 3,439 4,399 9,954 10,322 Professional services (29,393) 71,270 92,553 122,820 Licenses, taxes and other fees 10,910 18,273 71,201 58,933 Office 15,954 11,898 24,015 19,555 Public relations Rent - office 1,900 1,875 5,420 5,015 Repairs and maintenance 1,895 1,895 Research and development Selling 189,022 392,782 Telephone and utilities (347) 584 1,456 1,431 Transfer and registration fees 422 769 1,272 1,588 Travel and entertainment (2,830) 7,039 5,335 23,290 Watchman 100 1,375 700 2,755 Miscellaneous, general and administrative 237,732 3,765 338,468 7,615 Reimbursed expenses (2,749) (9,733) (9,151) (30,454) ----------- ----------- ----------- ----------- Total expenses 439,195 96,957 997,054 237,463 ----------- ----------- ----------- ----------- INCOME (LOSS) BEFORE NON-OPERATING ITEMS 15,403 (96,957) (54,740) (237,463) ----------- ----------- ----------- ----------- NON-OPERATING INCOME (EXPENSE) Interest income 15,318 925 18,035 2,419 Interest expense (12,960) (13,962) (40,527) (40,829) Forgiveness of debt 4,098 Gain on sale of securities Other income ----------- ----------- ----------- ----------- Total non-operating income (expense) 2,358 (13,037) (18,394) (38,410) ----------- ----------- ----------- ----------- INCOME (LOSS) BEFORE INCOME TAXES AND SUBSIDIARY LOSS (INCOME) 17,761 (109,994) (73,134) (275,873) ----------- ----------- ----------- ----------- INCOME TAXES AND SUBSIDIARY LOSS (INCOME) Income taxes Minority interest in subsidiary loss (income) 6,779 7,015 23,706 25,197 ----------- ----------- ----------- ----------- Total income taxes and subsidiary loss (income) 6,779 7,015 23,706 25,197 ----------- ----------- ----------- ----------- NET INCOME (LOSS) $ 24,540 $ (102,979) $ (49,428) $ (250,676) =========== =========== =========== =========== NET INCOME (LOSS) PER SHARE (NOTE 2) $ NIL $ (0.01) $ (0.01) $ (0.02) =========== =========== =========== ===========
The accompanying notes are an integral part of these financial statements. Page 6 of 12
MPM TECHNOLOGIES, INC. Consolidated Statement of Cash AND SUBSIDIARIES for the Nine Month Period Ended September 30, 1997 and 1996 - -------------------------------------------------------------------------------------- UNAUDITED Nine Months Ended September 30, 1997 1996 ------------- ------------- CASH FLOWS FROM OPERATING ACTIVITIES Net (loss) $ (49,428) $ (250,676) Add items not requiring the use of cash: Depreciation and amortization 58,416 9,120 Forgiveness of debt (4,098) Minority interest (23,706) (25,197) Loss (gain) on sale of equipment Stock granted for operating expenses Stock options issued for services Accrued interest payable converted to debt 1,014 Net (increase)/decrease in: Accounts receivable 922,493 (6,154) Other Current Assets (18,703) 4,571 Inventory (131,484) Net increase/(decrease) in: Accounts payable 108,486 Interest payable (1,028) 3,063 ------------- ------------- NET CASH FLOWS PROVIDED FROM OPERATING ACTIVITIES 860,948 (264,259) ------------- ------------- CASH FLOWS FROM INVESTING ACTIVITIES (Additions)/reductions: Mining claims Deferred exploration and development costs Property, plant and equipment (116,284) (3,518) Mining leases Leasehold improvements Patents and licenses 904 Advance minimum royalties Partnership investment Organization costs Proceeds from: Sale of equipment Redemption of bonds and deposits Loans made Less repayments ------------- ------------- NET CASH FLOWS PROVIDED (USED) FROM INVESTING ACTIVITIES (116,284) (2,614) ------------- ------------- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds of short term debt 200,000 275,000 Payments to settle debt (98,510) (108,973) Deferred Credit Sale of treasury stock Contributed capital 83,442 Issuance of common stock 84 ------------- ------------- NET CASH FLOWS PROVIDED FROM FINANCING ACTIVITIES 101,490 249,553 ------------- ------------- NET INCREASE (DECREASE) IN CASH 846,154 (17,320) CASH AT BEGINNING OF PERIOD 40,566 138,675 ------------- ------------- CASH AT END OF PERIOD $ 886,720 $ 121,355 ============= =============
The accompanying notes are an integral part of these financial statements. Page 7 of 12 MPM TECHNOLOGIES, INC. NOTES TO FINANCIAL STATEMENTS AND SUBSIDIARIES Spokane, Washington NOTE 1 - UNAUDITIED FINANCIAL STATEMENTS These financial statements should be read in conjunction with the audited financial statements included in the Annual Report on Form 10-KSB for the year ended December 31, 1996. Since certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting standards have been omitted pursuant to the rules and regulations of the Securities and Exchange Commission, these financial statements specifically incorporate by reference the footnotes to the consolidated financial statements of the Company as of December 31, 1996. In the opinion of management, these unaudited interim financial statements reflect all adjustments necessary for a fair presentation of the financial position and results of operations and cash flows of the Company. Such adjustments consisted only of those of a normal nature. Results of operations for the period ended September 30, 1997, should not necessarily be taken as indicative of the results of operations that my be expected for the entire year 1997. PART I Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations HUNTINGTON ENVIRONMENTAL SYSTEMS, INC. Effective April 1, 1997, MPM Technologies, Inc. acquired certain of the assets and assumed certain of the liabilities of part of a division of United States Filter Corporation in exchange for 1.32 million shares of common stock. In connection with the acquisition, the Company formed a wholly-owned subsidiary, Huntington Environmental Systems, Inc. ("HES") which assumed the assets and liabilities acquired. HES designs, engineers, supplies and services air pollution control systems for Fortune 500 and other environmental and industrial companies worldwide. Since the acquisition, HES has strategically pursued the consolidation of its operations through a reduction in both its overhead and operating costs while increasing its emphasis on sales and marketing. Steps to improve market share included the creation of the new position of Vice President of Sales and Marketing during the quarter ended September 30, 1997. The position was filled with a highly experienced individual in the pollution control industry. Additional steps have included the preparation of new product literature, presentation of technical papers and the continuation of attendance at strategic industry trade shows. Results of these efforts have shown in a number of areas. Requests for quotation have increased to an eighteen month high, both for firm quotations and for budget quotations. Budget quotations allow our customers to plan for 1998 expenditures. Quotations issued to repeat customers are numerous for both new and replacement equipment. Quotations for new projects abroad include installations in Canada, the United Kingdom and Australia. HES has received a contract for its first commercial two-chamber unit which will be started in February 1998. Two-chamber units will comprise an increasing percentage of the total VOC control market in the coming years. Fourth quarter 1997 results are expected to be flat as marketing efforts continue to take affect. Management anticipates that more positive results will be reflected in the form of improved revenues and profits in the second and third quarters of 1998. This acquisition was the first step in the Company's plan, instituted by the Board of Directors in 1996, to build a core business around air pollution control systems and related environmental remediation technologies. The Company's acquisition strategy is to acquire cash-positive, profitable companies to build an earnings base which would allow further expansion while the Skygas technology come to fruition. The acquisition of Huntington Environmental Systems, Inc., was specifically positive in that not only has the Company achieved revenues, but it also secured the services of one of the leading engineer firms in the United States to assist it with the Skygas technology evaluation. This allows the Company to work in conjunction with USF Smogless on particular issues and develop its own specific technological application for the Skygas process. NUPOWER, INC. (SKYGAS PROCESS) Skygas Venture partner USF Smogless moved forward with permitting issues pursuant to the agreement entered into with a consortium of European companies during 1996. The agreement calls for utilization of the Skygas technology along with USF Smogless' proprietary Flotherm technology for the destruction of selected wastes and the creation of fuel gas. The project is estimated to be in excess of $10 million of capital investment. Management expects to obtain all necessary permits during the fourth quarter of 1997. The Company is continuing with on-going negotiations for Skygas installations in Taiwan, South Korea, Thailand, China, Europe and North America. The Company has entered into a working agreement with the Institute of Gas Technology, Des Plaines, Illinois, to construct, de-bug and test the Skygas process. By building a Skygas plant at their fully permitted facility, the Company will use IGT to accelerate completion of the technology and help locate potential customers. Upon completion management expects to receive EPA approval for Skygas and fast-track entrance into the extensive North American market while running parallel with USF Smogless' efforts in Europe. The Company intends to attract and end user to finance the construction of this plant. Skygas is a patented process for converting carbonaceous materials into clean-burning medium BTU fuel gas which can be used for electrical power generation or for conversion into a variety of valuable chemicals. In March of 1990, NuPower, a Montana general partnership, in which NuPower, Inc., a wholly owned subsidiary of MPM Technologies, Inc., owns a 58.21% interest, entered into an agreement with Smogless S.p.A., Milan, Italy, and Unitel Technologies, Inc., Mt. Prospect, IL, for the purpose of commercializing the Skygas process. Smogless agreed to finance, engineer, build, test and operate a commercial demonstration facility. Unitel agreed to handle all promotional work, public relations, advertising and marketing of the process. In 1994, Smogless S.p.A. was purchased by United States Filter Corp. (NYSE: USF), Palm Desert, CA, and renamed USF Smogless. In December of 1996, MPM announced it had purchased Unitel's 15% interest in the Venture for 1.2 million shares of common stock. Management believes that by acquiring this interest the Company has better positioned itself financially regarding future sales of the technology. Percentage of interest in the Skygas Venture is as follows: NuPower (of which the Company owns 58.21%) - 70%; USF Smogless - 15%; and MPM Technologies, Inc. - 15%. MINING The Company owns or controls 32 patented and unpatented lode claims amounting to approximately 750 acres in the heart of the historical Emery Mining District, Powell County, Montana. The 32 claims include eight patented claims and sixteen unpatented claims owned by the Company and eight patented claims leased by the Company. During the Second Quarter of 1997, the Company did not renew leases on thirteen unpatented claims to better consolidate its holdings and cut expenses. To date, the Company has expended over $1.3 million on exploration and development, lease payments and claims. Over $532,000 has been expended by the Company on buildings, mill machinery, vehicles and equipment. Management is seeking a joint venture partner to further explore and develop the properties. QUARTER ENDED 9/30/97 COMPARED TO QUARTER ENDED 9/30/96 Results of Operations 1997 1996 Inc/(Dec) % of Change Working Capital (Deficit) 1,757,899 (1,008,700) 2,766,599 274 Total Operating Expenses 439,195 96,957 342,238 352 Interest Expenses 12,960 13,962 ( 1,002) ( 7) Contract Services 1,930 ( 18,605) 20,535 110 Insurance 3,439 4,399 ( 960) ( 21) Professional Services ( 29,393) 44,205 ( 73,598) (166) Office and Postage 15,954 11,898 4,056 34 Reimbursed Expenses 2,749 9,733 ( 6,984) ( 71) Travel and Entertainment ( 2,830) 7,039 ( 9,869) (140) Net Income (Loss) 24,540 ( 102,979) 127,519 123 Changes from the Third Quarter 1996 to the Third Quarter 1997 reflect the Company's acquisition and financial consolidation with Huntington Environmental Systems, Inc. PART II Item 1. Legal Proceeding The Company knows of no litigation present, threatened or contemplated or unsatisfied judgment against the Company, its officers or directors or any proceedings in which the Company, its officers or directors are a party. Item 2. Changes in Securities The rights of the holders of the Company's securities have not been modified nor have the rights evidenced by the securities been limited or qualified by the issuance or modification of any other class of securities. Item 3. Defaults upon Senior Securities There are no senior securities issued by the Company. Item 4. Submission of Matters to a Vote of Security Holders On September 15, 1997, at the Annual Meeting of Stockholders of the Corporation, the following items were brought to a vote: Election of Directors: L. Craig Cary Smith For: 11,734,068 Withhold: 52,590 To approve the selection of Terrence J. Dunne, CPA, PS, as independent auditors of the Corporation for the fiscal year ending December 31, 1997: For: 11,690,253 Against: 50,020 Abstain: 46,385 To amend the 1989 Stock Option Plan: For: 11,219,845 Against: 308,622 Abstain: 114,460 The total voted shares of 11,786,658 represented 71.6% of the common stock outstanding. At record date July 18, 1997, the common stock outstanding was 16,463,404. Item 5. Other Information There is no other information to report under this item. 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 thereunto duly authorized. MPM TECHNOLOGIES, INC. 11/13/97 /s/Robert D. Little ------------------- ---------------------- (Date) Robert D. Little Secretary EX-27 2
5 9-MOS DEC-31-1997 SEP-30-1997 886720 0 2486147 180902 650056 3862162 803103 479831 6935401 2104263 0 0 0 16459 4357273 6935401 4311620 4359620 3417306 4414360 997054 0 40527 (49428) 0 (49428) 0 0 0 (49428) (.01) (.01)
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