-----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, PNuBnGX8ItqXt0nB5hkU/DaIxsW26tCTwlQoRGFG+/6e+vjY4SNXYpznALpfgfLM 0YEE6m6w7lQeBHvkl0GS6w== 0001095811-00-001433.txt : 20000516 0001095811-00-001433.hdr.sgml : 20000516 ACCESSION NUMBER: 0001095811-00-001433 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20000331 FILED AS OF DATE: 20000515 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PLANET POLYMER TECHNOLOGIES INC CENTRAL INDEX KEY: 0000896861 STANDARD INDUSTRIAL CLASSIFICATION: PLASTICS, MATERIALS, SYNTH RESINS & NONVULCAN ELASTOMERS [2821] IRS NUMBER: 330502606 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-26804 FILM NUMBER: 630734 BUSINESS ADDRESS: STREET 1: 9985 BUSINESS PARK WAY STE A CITY: SAN DIEGO STATE: CA ZIP: 92131 BUSINESS PHONE: 6195495130 MAIL ADDRESS: STREET 1: 9985 BUSINESSPARK AVE STREET 2: STE A CITY: SAN DIEGO STATE: CA ZIP: 92131 FORMER COMPANY: FORMER CONFORMED NAME: PLANET POLYMER TECHNOLOGY INC DATE OF NAME CHANGE: 19950511 10QSB 1 FORM 10-QSB 1 UNITED STATES 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 AND EXCHANGE ACT OF 1934 For Quarterly Period Ended March 31, 2000 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 Commission File Number: 0-26804 PLANET POLYMER TECHNOLOGIES, INC. ---------------------------------------------------------------------- (Exact name of small business issuer as specified in its character) CALIFORNIA 33-0502606 ---------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 9985 Businesspark Avenue, San Diego, California 92131 ---------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (858) 549-5130 ---------------------------------------------------------------------- (Issuer's telephone number, including area code) Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:
Class Outstanding at March 31, 2000 ----- ----------------------------- Common Stock, no par value 7,608,708
2 PLANET POLYMER TECHNOLOGIES, INC. FORM 10-QSB QUARTERLY REPORT QUARTER ENDED MARCH 31, 2000 INDEX
PAGE NO. -------- PART I - FINANCIAL INFORMATION Item 1 Balance Sheet (Unaudited) March 31, 2000 2 Statements of Operations (Unaudited) Three Months Ended March 31, 2000 and 1999 3 Statement of Shareholders' Equity (Unaudited) Three Months Ended March 31, 2000 4 Statements of Cash Flows (Unaudited) Three Months Ended March 31, 2000 and 1999 5 Notes to Unaudited Financial Statements 6 Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations 8 PART II - OTHER INFORMATION Item 1 Legal Proceedings 12 Item 2 Changes in Securities 12 Item 3 Defaults upon Senior Securities 12 Item 4 Submission of Matters to a Vote of Security Holders 12 Item 5 Other Information 12 Item 6 Exhibits and Reports on Form 8K 13 SIGNATURES 14
3 PLANET POLYMER TECHNOLOGIES, INC. BALANCE SHEET (UNAUDITED) ---------------
MARCH 31, 2000 ------------ ASSETS Current assets: Cash and cash equivalents $ 1,374,022 Accounts receivable 70,575 Note receivable 6,942 Inventories, net 167,443 Prepaid expenses 40,676 ------------ Total current assets 1,659,658 Property and equipment, net of accumulated depreciation of $226,892 196,066 Patents and trademarks, net of accumulated amortization of $134,435 336,323 Note receivable, less current portion 91,407 Other assets 6,375 ------------ Total assets $ 2,289,829 ============ LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 85,597 Accrued expenses 48,235 Advances from related party 7,568 Current portion of capital lease obligations 7,286 ------------ Total current liabilities 148,686 Capital lease obligations, less current portion 13,867 Other liabilities 152,886 ------------ Total liabilities 315,439 ------------ Shareholders' equity: Preferred Stock, no par value 4,250,000 shares authorized No shares issued or outstanding -- Series A Convertible Preferred Stock, no par value 750,000 shares authorized 321,500 shares issued and outstanding Liquidation preference $1,000,000 517,251 Common Stock, no par value 20,000,000 shares authorized 7,608,708 shares issued and outstanding 13,228,263 Accumulated deficit (11,771,124) ------------ Total shareholders' equity 1,974,390 ------------ Total liabilities and shareholders' equity $ 2,289,829 ============
The accompanying notes are an integral part of the financial statements. 2 4 PLANET POLYMER TECHNOLOGIES, INC. STATEMENTS OF OPERATIONS (UNAUDITED) ---------------
THREE MONTHS ENDED MARCH 31, ----------------------------- 2000 1999 ----------- ----------- Sales $ 161,272 $ -- Cost of sales 116,563 -- ----------- ----------- Gross profit 44,709 -- ----------- ----------- Operating expenses: General and administrative 245,573 223,548 Marketing 41,982 35,334 Research and development, net 63,010 50,962 ----------- ----------- Total operating expenses 350,565 309,844 ----------- ----------- Loss from operations (305,856) (309,844) Other income (expense), net 14,938 (4,825) ----------- ----------- Loss from continuing operations before income taxes (290,918) (314,669) Income tax expense (800) (800) ----------- ----------- Loss from continuing operations (291,718) (315,469) Discontinued operations: Income from discontinued operations, net of tax expense of $1,472 -- 17,163 ----------- ----------- Income from discontinued operations -- 17,163 ----------- ----------- Net loss $ (291,718) $ (298,306) =========== =========== Loss per share from continuing operations (basic and diluted) $ (0.04) $ (0.05) ----------- ----------- Income per share from discontinued operations (basic and diluted) $ -- $ -- ----------- ----------- Net loss per share (basic and diluted) $ (0.04) $ (0.05) =========== =========== Shares used in per share computations 7,135,026 6,220,616 =========== ===========
The accompanying notes are an integral part of the financial statements. 3 5 PLANET POLYMER TECHNOLOGIES, INC. STATEMENT OF SHAREHOLDERS' EQUITY (UNAUDITED) ---------------
SERIES A PREFERRED STOCK COMMON STOCK ------------------------ ------------------------ ACCUMULATED SHARES AMOUNT SHARES AMOUNT DEFICIT TOTAL ---------- --------- --------- ------------ ------------- ----------- Balance at December 31, 1999 500,000 $ 804,435 6,875,976 $ 12,426,143 $(11,467,470) $1,763,108 Conversion of Series A Preferred Stock into Common Stock on January 20, 2000 (102,000) (164,105) 119,997 164,105 -- -- Stock Options exercised for cash on February 15, 2000 -- -- 10,000 30,250 -- 30,250 Stock Options exercised for cash on March 2, 2000 -- -- 10,000 30,250 -- 30,250 Warrants exercised on March 3, 2000 -- -- 500,000 500,000 -- 500,000 Transaction fee to the finder -- -- -- (60,000) -- (60,000) Issuance of Warrants to the finder on March 9, 2000 -- -- -- 2,500 -- 2,500 Issuance of Common Stock as a dividend on Convertible Preferred Stock on March 15, 2000 -- -- 2,736 11,936 (11,936) -- Conversion of Series A Preferred Stock into Common Stock on March 28, 2000 (76,500) (123,079) 89,999 123,079 -- -- Net loss for the three months ended March 31, 2000 -- -- -- -- (291,718) (291,718) -------- --------- --------- ------------ ------------ ---------- Balance at March 31, 2000 321,500 $ 517,251 7,608,708 $ 13,228,263 $(11,771,124) $1,974,390 ======== ========= ========= ============ ============ ==========
The accompanying notes are an integral part of the financial statements. 4 6 PLANET POLYMER TECHNOLOGIES, INC. STATEMENTS OF CASH FLOWS (UNAUDITED) ---------------
THREE MONTHS ENDED MARCH 31, -------------------------- 2000 1999 ----------- ----------- Cash flows from operating activities: Net loss $ (291,718) $ (298,306) Adjustments to reconcile net loss to net cash used by operating activities: Depreciation and amortization 19,112 35,652 Loss on disposal of assets -- 9,994 Income from discontinued operations -- (17,163) Changes in assets and liabilities: Accounts receivable 64,342 (79,142) Inventories, net (14,008) 4,534 Prepaid expenses and other assets 9,318 3,811 Accounts payable and accrued expenses (12,546) (128,035) ----------- ----------- Net cash used by continuing operations (225,500) (468,655) Net cash provided by discontinued operations -- 70,986 ----------- ----------- Net cash used by operating activities (225,500) (397,669) ----------- ----------- Cash flows from investing activities: Purchases of property and equipment (2,898) (66,938) Cost of patents and other (16,949) (20,678) Proceeds from the sale of subsidiary 814,639 -- Payments from note receivable 1,651 -- ----------- ----------- Net cash provided (used) by investing activities 796,443 (87,616) ----------- ----------- Cash flows from financing activities: Proceeds from issuance of Common Stock -- 1,000,000 Proceeds from issuance of warrants 2,500 2,500 Proceeds from warrants exercised 500,000 -- Payment of equity issuance costs (60,000) (73,952) Proceeds from stock options exercised 60,500 9,375 Principal payments on borrowings and capital lease obligations (1,650) (97,810) Advances from related party (53,916) 73,333 Restricted cash in connection with borrowings -- 114,880 ----------- ----------- Net cash provided by financing activities 447,434 1,028,326 ----------- ----------- Net increase in cash and cash equivalents 1,018,377 543,041 Cash and cash equivalents at beginning of year 355,645 149,117 ----------- ----------- Cash and cash equivalents at end of year $ 1,374,022 $ 692,158 =========== =========== Supplemental disclosure of non-cash activity: Issuance of Common Stock dividends on Preferred Stock $ 11,936 $ 15,000 Issuance of note receivable in connection with sale of subsidiary 100,000 --
The accompanying notes are an integral part of the financial statements. 5 7 PLANET POLYMER TECHNOLOGIES, INC. NOTES TO UNAUDITED FINANCIAL STATEMENTS 1. Basis of Presentation In management's opinion, the accompanying unaudited financial statements of Planet Polymer Technologies, Inc. ("Planet" or the "Company") have been prepared in accordance with the interim reporting requirements of Form 10-QSB, pursuant to the rules and regulations of the Securities and Exchange Commission. However, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. In management's opinion, all adjustments (consisting of only normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2000 are not necessarily indicative of results that may be expected for the year ending December 31, 2000. For additional information, refer to the Company's consolidated financial statements and notes thereto for the year ended December 31, 1999 contained in the Company's Form 10-KSB for the fiscal year ended December 31, 1999. Certain prior period amounts have been reclassified to conform to the current period presentation. 2. Discontinued Operations On December 30, 1999, the Company and its wholly owned subsidiary, Deltco of Wisconsin, Inc. ("Deltco"), entered into a Stock Purchase Agreement (the "Purchase Agreement") with Daniel B. Mettler and Randy J. Larson (together, the "Buyers") whereby the Company agreed to sell and the Buyers agreed to purchase all of the outstanding shares of stock of Deltco for an aggregate purchase price of $1,000,000. The Buyers are management employees of Deltco. The sale of Deltco was finalized on January 7, 2000. The Company received $900,000 in cash and a secured promissory note in the amount of $100,000. This note is collateralized by all of the equipment, accounts, inventory, supplies and personal property now held or hereafter acquired by Deltco. The accompanying financial statements present the results of operations of Deltco as a discontinued operation for the three months ended March 31, 1999. Accordingly, the Company's continuing operations are now comprised of one segment, the "Research and Development" business segment. 3. Shareholders' Equity Agway exercised warrants to purchase 500,000 shares of the Company's Common Stock on both November 5, 1999 and March 3, 2000. After receiving cumulative proceeds of $1,000,000 from Agway, the Company was required to (i) pay a $60,000 cash transaction fee to LBC Capital Resources, Inc. ("LBC"), and (ii) issue LBC five-year warrants to purchase 50,000 shares of Common Stock with an exercise price of $4.1625 per warrant, in exchange for $2,500. These warrants were issued March 9, 2000 pursuant to an exemption from registration for transactions not involving a public offering. 6 8 PLANET POLYMER TECHNOLOGIES, INC. NOTES TO UNAUDITED FINANCIAL STATEMENTS - (CONTINUED) 3. Shareholders' Equity (Continued) The holder of the Series A Convertible Preferred Stock ("Series A Preferred") is entitled to receive quarterly dividends at an annual rate of 6% payable in shares of the Company's Common Stock. Each share of Series A Preferred is convertible at the option of the holder into shares of Common Stock of the Company. On January 20, 2000, 102,000 shares of Preferred Stock were converted into 119,997 shares of Common Stock. On March 15, 2000, the Company issued a dividend of 2,736 shares of Common Stock valued at approximately $11,936. On March 28, 2000, 76,500 shares of Preferred Stock were converted into 89,999 shares of Common Stock. 7 9 PART 1 - FINANCIAL INFORMATION ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS PLANET POLYMER TECHNOLOGIES, INC. Except for the historical information contained herein, the discussion in this report contains forward-looking statements that involve certain risks and uncertainties. The Company's actual results could differ materially from those discussed in this report. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and in the Company's Form 10-KSB for the fiscal year ended December 31, 1999. OVERVIEW Since Planet Polymer Technologies, Inc. ("Planet" or the "Company") was founded in 1991 substantially all of the Company's resources have been devoted to the development and commercialization of its technologies and products. This has included the expenditure of funds to develop the Company's corporate infrastructure, support the Company's marketing efforts and establish a pilot production facility, in addition to research and development. Planet has incurred operating losses since inception and had an accumulated deficit as of March 31, 2000 of approximately $11.8 million. Pending commercial deployment of and related volume orders for the Company's products, the Company expects to incur additional losses. In November 1998, the Company entered into a stock purchase transaction with a subsidiary of Agway Inc. ("Agway") whereby Agway purchased 1,000,000 shares of Planet's Common Stock for $1,000,000 (the "Stock Purchase Agreement") and received a warrant to purchase up to 2,000,000 additional shares of Common Stock at a price of $1.00 per share (the "Warrant"). The stock purchase transaction was completed in January 1999 with the Company's shareholders' approval. To date, Agway has exercised warrants to purchase 1,000,000 shares of Common Stock and holds a warrant to purchase an additional 1,000,000 shares. Contemporaneously with the execution of the Stock Purchase Agreement, Planet and Agway entered into an agreement relating to the funding by Agway of a feasibility study (the "Feasibility Agreement") of Planet's polymer technology for use in agricultural products (other than fertilizers and certain biological products) and food products. Under the terms of the Feasibility Agreement, the Company is reimbursed for certain qualifying research and development costs from Agway. Also in November 1998, the Company granted Agway an exclusive worldwide license (the "License Agreement") to all current and future products that utilize Planet's polymer technology for agricultural and food related purposes (other than products already covered by existing agreements). Under the terms of the License Agreement, Agway has the exclusive right to grant licenses and sublicenses to other parties on the technology developed under the License Agreement. The Company and Agway agreed to execute further sub-agreements (each a "Sub-Agreement") to specify the royalties to be paid to the Company for Agway's use of the Company's technology on certain specific products. In March 2000, the Company and Agway entered into a Sub-Agreement with respect to animal feed products incorporating Planet's patented/patent pending coatings and/or polymer systems. Also in March 2000, the Company and Agway entered into another Sub-Agreement with respect to Planet's patented/patent pending coatings and/or polymer systems sold for use on fruits, vegetables, floral and nursery items. 8 10 ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - (CONTINUED) PLANET POLYMER TECHNOLOGIES, INC. RESULTS OF OPERATIONS On January 7, 2000, the Company sold all of its common stock shares of Deltco. In accordance with the Purchase Agreement, the Company received total proceeds of $1,000,000 in the form of $900,000 in cash and $100,000 in a secured promissory note in consideration of the sale of its Deltco common stock. This note is collateralized by all of the equipment, accounts, inventory, supplies and personal property now held or hereafter acquired by Deltco. The accompanying financial statements present the results of operations of the Company and Deltco as a discontinued operation. Accordingly, the Company's continuing operations are now comprised of one segment, the "Research and Development" business segment. The following discussion of results of operations relates solely to the Company's continuing operations. Revenue The Company's revenues increased from $0 for the three months ended March 31, 1999 to approximately $161,000 for the same period in 2000. This increase was attributable to the successful commercial deployment of EnviroPlastic(R) Z. Cost of Sales Cost of sales increased from $0 for the three months ended March 31, 1999 to approximately $117,000 for the same period in 2000. This increase was due to the costs associated with the commercialization of EnviroPlastic(R) Z. General and Administrative Expenses General and administrative expenses increased from approximately $224,000 for the three months ended March 31, 1999 to approximately $246,000 for the same period in 2000. This increase was primarily attributable to increased costs of professional fees due to services provided by an independent consultant. Marketing Expenses Marketing expenses increased from approximately $35,000 for the three months ended March 31, 1999 to approximately $42,000 for the same period in 2000. This increase was primarily attributable to increased costs associated with the promotion of AQUAMIM(TM). 9 11 ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - (CONTINUED) PLANET POLYMER TECHNOLOGIES, INC. RESULTS OF OPERATIONS, CONTINUED Research and Development Expenses, Net The Company's net research and development expenses increased from approximately $51,000 for the three months ended March 31, 1999 to approximately $63,000 for the same period in 2000. This increase was primarily due to a reduction in allocated research and development resources to projects that are reimbursable by Agway under the Feasibility Agreement. Offsetting reimbursable research and development revenue from customers other than Agway decreased from approximately $24,000 for the three months ended March 31, 1999 to approximately $18,000 for the same period in 2000. Offsetting reimbursable research and development costs from Agway decreased from approximately $139,000 for the three months ended March 31, 1999 to approximately $54,000 for the same period in 2000. A net advance of funds of approximately $8,000 existed as of March 31, 2000. LIQUIDITY AND CAPITAL RESOURCES In January 1999, with the Company's shareholders' approval, the Company issued 1,000,000 shares of Common Stock to Agway and received proceeds of $845,000, net of issuance costs totaling approximately $155,000. In addition, from January 2000 to March 2000, the Company recorded reimbursable research and development costs of approximately $54,000 from Agway under the Feasibility Agreement. The Company anticipates that some of the 2000 research and development expenditures in the agrotechnology area will be reimbursed by Agway under the Feasibility Agreement. Additionally, in February 1999, the Company received a commitment from Agway whereby Agway agreed to exercise its Warrant to acquire up to 500,000 shares of the Company's Common Stock as early as July 1, 1999, at the Company's request, in the event the Company's cash flows were less than projected and/or insufficient to fund its operating requirements. On November 5, 1999, at the Company's request, Agway exercised the Warrant with respect to 500,000 shares of the Company's Common Stock on the terms, and subject to conditions, set forth in the Warrant and the Company received $500,000 in connection with such exercise. On March 3, 2000, Agway exercised a Warrant to purchase an additional 500,000 shares of Common Stock. To date, Agway has exercised warrants to purchase 1,000,000 shares of Common Stock and holds a Warrant to purchase an additional 1,000,000 shares. The Company used approximately $226,000 for continuing operations for the three months ended March 31, 2000. Such funds were used primarily for research and development activities, marketing efforts and administrative support. Net cash provided by investing activities of approximately $796,000 for the three months ended March 31, 2000 resulted from proceeds from the sale of Deltco of approximately $816,000, net of Deltco's cash, offset by approximately $20,000 used for the purchase of equipment and for the preparation and filing of patents. 10 12 ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - (CONTINUED) PLANET POLYMER TECHNOLOGIES, INC. LIQUIDITY AND CAPITAL RESOURCES, CONTINUED Net cash provided by financing activities of approximately $447,000 for the three months ended March 31, 2000 resulted from net proceeds of approximately $440,000 from the exercise of warrants, $60,000 from the exercise of stock options, and $3,000 from the issuance of warrants, offset by a net reduction in the advance of funds of approximately $54,000 from Agway and $2,000 used for capital lease obligations. The Company believes that its existing sources of liquidity and anticipated revenue, cash proceeds from the sale of Deltco and proceeds from Agway's warrant exercise for 500,000 shares of Common Stock on March 3, 2000, will satisfy the Company's projected working capital and other cash requirements through at least the next twelve months. There can be no assurance, however, that future revenue decreases or changes in the Company's plans or other events affecting the Company's operating expenses will not result in the expenditure of the Company's resources. The Company expects that it will need to raise substantial additional funds to continue its current and planned operations. The Company intends to seek additional funding from existing and potential customers or through public or private equity or debt financing. There can be no assurance that additional financing will be available on acceptable terms, or at all. The Company's ability to raise additional capital may be dependent upon the stock being quoted on the Nasdaq SmallCap Market. There can be no assurance that the Company will be able to satisfy the criteria for continued quotation on the Nasdaq SmallCap Market. For example, one of the criteria for continued quotation is that the Company will maintain net tangible assets of $2 million. As of March 31, 2000, the Company's net tangible assets were approximately $1.97 million. As noted above, the Company received $500,000 from Agway in connection with Agway's purchase of 500,000 shares of Common Stock under the Warrant, which the parties believe was necessary to satisfy the Nasdaq SmallCap listing criteria with respect to the Company's Common Stock. Failure to meet the maintenance criteria in the future may result in the Company's Common Stock not being eligible for quotation. In such event, an investor may find it more difficult to determine the market value of the Company's Common Stock and/or make future dispositions of the Company's Common Stock. 11 13 PART II - OTHER INFORMATION PLANET POLYMER TECHNOLOGIES, INC. Item 1 -Legal Proceedings: In November 1998, the Company initiated litigation against Brian To, a former director, officer and consultant of the Company, Tarrenz Inc. and Tarrenz Management Consultants, Inc., entities owned by Brian To (collectively referred to as the "defendants"), in the Superior Court of the State of California for the County of San Diego. The complaint alleges breach of contract, breach of fiduciary duty and other tort claims arising from services the defendants performed for or on behalf of the Company. The Company is seeking recovery of compensation, stock, stock options and expense reimbursements. In response to the Complaint, the defendants filed a motion to compel arbitration. The Court issued an order compelling the case to arbitration on Friday, March 12, 1999. On April 26, 1999, the defendants answered and denied the allegations of the complaint and filed a cross-complaint against the Company alleging breach of contract, misrepresentation, slander, intentional infliction of emotional distress and fraud. In response to the Company's motion, the arbitrator issued a ruling on May 1, 2000 disqualifying defendants' counsel based on a finding that said counsel had previously represented the Company in a related matter. As a result, the arbitration previously set for February 28, 2000 will be rescheduled after the defendants retain new counsel. In light of the limited discovery allowed in arbitration, it is difficult to evaluate defendants' claims. However, in the opinion of management, the ultimate resolution of this litigation is not expected to have a material adverse effect on the Company's financial position or results of operations. Item 2 -Changes in Securities: Agway exercised warrants to purchase 500,000 shares of Common Stock on March 3, 2000 in exchange for $500,000. Such shares were issued pursuant to Section 4(2) for an exemption from registration for transactions not involving a public offering. In connection with Agway's exercise of its right to purchase 1,000,000 shares of Planet's Common Stock pursuant to the Warrant dated January 11, 1999, the Company issued LBC Capital Resources, Inc. ("LBC") five-year warrants to purchase 50,000 shares of the Company's Common Stock at an exercise price of $4.1625 per warrant, in exchange for $2,500. These warrants were issued March 9, 2000, pursuant to Section 4(2) for an exemption from registration for transactions not involving a public offering. Item 3 -Defaults upon Senior Securities: None Item 4 -Submission of Matters to a Vote of Security Holders: None Item 5 -Other Information: None 12 14 PART II - OTHER INFORMATION - (CONTINUED) PLANET POLYMER TECHNOLOGIES, INC. Item 6 - Exhibits and Reports on Form 8-K: (a) Exhibits:
Exhibit Number Description ------------- ----------- 11.1 Statement of Computation of Common and Common Equivalent Shares 27.1 Financial Data Schedule
(b) Reports on Form 8-K: On January 14, 2000, the Company filed a Current Report on Form 8-K to report the sale of Deltco of Wisconsin, Inc. On March 10, 2000, the Company filed a Current Report on Form 8-K/A (Amendment No. 1) to file pro forma financial statements. The pro forma financial statements included an unaudited balance sheet as of September 30, 1999 and unaudited statements of operations for the nine months ended September 30, 1999 and 1998 and for the fiscal years ended December 31, 1998 and December 31, 1997. 13 15 PLANET POLYMER TECHNOLOGIES, INC. SIGNATURES In accordance with the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: May 12, 2000 Planet Polymer Technologies, Inc. /S/ ROBERT J. PETCAVICH --------------------------------------- Robert J. Petcavich Chairman and Chief Executive Officer (On behalf of Registrant and as Registrant's Principal Financial and Accounting Officer) 14 EX-11.1 2 EXHIBIT 11.1 1 PLANET POLYMER TECHNOLOGIES, INC. EXHIBIT 11.1 Statement of Computation of Common and Common Equivalent Shares AS OF MARCH 31, 2000
Three months ended March 31, ------------------------------- 2000 1999 ---- ---- Shares outstanding at beginning of period 5,341,062 5,341,062 1,000,000 shares issued on January 11, 1999 1,000,000 877,778 9,677 shares issued on March 15, 1999 9,677 1,720 5,000 shares issued on March 30, 1999 5,000 56 9,677 shares issued on June 15, 1999 9,677 -- 5,106 shares issued on September 15, 1999 5,106 -- 500,000 shares issued on November 5, 1999 500,000 -- 5,454 shares issued on December 15, 1999 5,454 -- --------- --------- Weighted average number of shares 6,875,976 6,220,616 ========= 119,997 shares issued on January 20, 2000 93,624 10,000 shares issued on February 15, 2000 4,945 10,000 shares issued on March 2, 2000 3,187 500,000 shares issued on March 3, 2000 153,846 2,736 shares issued on March 15, 2000 481 89,999 shares issued on March 28, 2000 2,967 --------- Weighted average number of shares 7,135,026 =========
EX-27.1 3 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE COMPANY'S UNAUDITED MARCH 31, 2000 BALANCE SHEET AND STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH STATEMENTS AS FILED IN THE COMPANY'S FORM 10-QSB FOR THE THREE MONTHS ENDED MARCH 31, 2000. 3-MOS DEC-31-2000 JAN-01-2000 MAR-31-2000 1,374,022 0 77,517 0 167,443 1,659,658 422,958 (226,892) 2,289,829 148,686 0 0 517,251 13,228,263 (11,771,124) 2,289,829 161,272 161,272 116,563 116,563 350,565 0 879 (290,918) 800 (291,718) 0 0 0 (291,718) (0.04) (0.04)
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