-----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, DrLXyLQ2nkPaKGLO2hbdxgGGzOOdF4dxAbFJA+hEhajbUNvzFVK9yRADrB3Dv6eq EsyPSlnZHs/c99YVb8zofQ== 0000909334-04-000362.txt : 20041230 0000909334-04-000362.hdr.sgml : 20041230 20041230172815 ACCESSION NUMBER: 0000909334-04-000362 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20041229 ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041230 DATE AS OF CHANGE: 20041230 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BEARD CO /OK CENTRAL INDEX KEY: 0000909992 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL INORGANIC CHEMICALS [2810] IRS NUMBER: 730970298 STATE OF INCORPORATION: OK FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-12396 FILM NUMBER: 041234968 BUSINESS ADDRESS: STREET 1: 5600 N MAY AVE STREET 2: STE 320 CITY: OKLAHOMA CITY STATE: OK ZIP: 73112 BUSINESS PHONE: 4058422333 MAIL ADDRESS: STREET 1: 5600 N MAY STREET 2: STE 320 CITY: OKLAHOMA CITY STATE: OK ZIP: 73112 FORMER COMPANY: FORMER CONFORMED NAME: BEARD INVESTMENT CO DATE OF NAME CHANGE: 19930730 8-K 1 bcform8k-123004.txt SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report: (Date of earliest event reported) December 29, 2004 THE BEARD COMPANY (Exact name of registrant as specified in its charter) Oklahoma 001-12396 73-0970298 (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) Enterprise Plaza 5600 N. May Avenue Suite 320 Oklahoma City, Oklahoma 73112 (Address of principal executive offices) (Zip Code) (405) 842-2333 (Registrant's telephone number, including area code) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b)) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Information to be Included in the Report Item 7.01 Regulation FD Disclosure. On December 21, 2004, the Company filed a Form 8-K reporting that it had arranged for an investment banking firm to sell $1,500,000 of 12% convertible subordinated notes (the "Notes") to accredited investors in a private placement on a best efforts basis and issued a press release in connection therewith. In connection with the private placement, the Company disclosed material information to the Private Placement Agent and such information will be disclosed to other parties who receive the Confidential Private Placement Memorandum (the "PPM"). Pursuant to Regulation FD, the Company disclosed this material information in the Company's Form 8-K filed December 21, 2004. On December 29, 2004, the Company amended the offering (the "Amended PPM") to increase the amount being sold up to a maximum of $2,100,000 and to add a schedule of production equipment owned by Beard Technologies, Inc. and having an estimated fair market value of approximately $2,315,000. Holders of the Notes will be granted a contingent security interest in the equipment in the event the Company does not proceed with a coal reclamation project (the Pinnacle Project) which it expects to commence during the first quarter of 2005. Included in the PPM were Statements of Projected Operations and the accompanying Notes thereto which were attached as Exhibit 99.1 under Item 9.01 of the Company's December 21, 2004 Form 8-K filing. In the Amended PPM the Statements of Projected Operations have been revised to reflect lower net earnings per common share in 2006 and 2007 as a result of an increase in the weighted average common shares expected to be outstanding for such years. A copy of the revised Statements of Projected Operations is attached as Exhibit 99.1. The Notes have not changed since the earlier filing and the caveats thereto still apply. Item 9.01 Financial Statements and Exhibits (c) Exhibits. The following exhibit is filed with this Form 8-K and is identified by the number indicated: Exhibit No. Description - ----------- ----------- 99.1 Statements of Projected Operations for 2004 through 2007 and accompanying Notes to Statements of Projected Operations 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. THE BEARD COMPANY /s/ Herb Mee, Jr. ------------------------------- Herb Mee, Jr., President December 30, 2004 INDEX TO EXHIBITS Exhibit No. Description Method of Filing - --- ----------- ---------------- 99.1 Statements of Projected Operations for Filed herewith electronically 2004 through 2007 and accompanying Notes to Statements of Projected Operations EX-99 2 bcex991form8k-123004.txt Exhibit 99.1 FORWARD-LOOKING STATEMENTS The Statements of Projected Operations include "forward-looking statements" within the meaning of Section 27a of the Securities Act of 1933, as amended, and Section 21e of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts are forward-looking statements. Although we believe that the expectations reflected in such statements are reasonable, we cannot assure you that such expectations will occur. Our actual future performance could differ materially from such statements as a result of many factors, including but not limited to coal prices, production costs, and recoverable reserves. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed in the Amended PPM and at pages 16-18 of the Company's Form 10-K for the fiscal year ended December 31, 2003. THE BEARD COMPANY AND SUBSIDIARIES Statements of Projected Operations (Unaudited)
2004 2005 2006 2007 ---- ---- ---- ---- Revenues: Coal reclamation (a) $ 146,000 $ 3,978,000 $ 19,687,000 $ 34,666,000 Carbon dioxide (b) 750,000 900,000 960,000 960,000 China (c) - 1,590,000 10,868,000 15,905,000 e-Commerce (d) 29,000 15,000 40,000 75,000 ----------------------------------------------------------------- 925,000 6,483,000 31,555,000 51,606,000 Operating expenses (e) 2,597,000 5,520,000 19,964,000 32,600,000 ----------------------------------------------------------------- Operating profit (loss) (1,672,000) 963,000 11,591,000 19,006,000 Other income (expense): Interest income 2,000 - - - Interest expense (f) (579,000) (1,031,000) (1,891,000) (2,092,000) Equity in net earnings of unconsolidated affiliate (g) 300,000 210,000 - - Gain on settlement 2,943,000 - - - Gain on sale of assets 87,000 - - - Minority interest in operations of consolidated subsidiaries - (666,000) (5,021,000) (7,560,000) Other 6,000 - - - ----------------------------------------------------------------- Earnings before income taxes 1,087,000 (524,000) 4,679,000 9,354,000 Income taxes (124,000) - - - ----------------------------------------------------------------- Net earnings (h) $ 963,000 $ (524,000) $ 4,679,000 $ 9,354,000 ================================================================= Net earnings per common share: Basic $ 0.18 $ (0.09) $ 0.79 $ 1.32 ================================================================= Diluted $ 0.15 $ (0.09) $ 0.58 $ 1.11 ================================================================= Weighted average common shares outstanding: Basic 5,230,000 5,640,000 5,920,000 7,072,000 ================================================================= Diluted 6,279,000 5,640,000 8,078,000 8,414,000 =================================================================
See accompanying notes to financial statements. THE BEARD COMPANY AND SUBSIDIARIES NOTES TO THE STATEMENTS OF PROJECTED OPERATIONS (Unaudited) (a) The Company's principal business is coal slurry pond reclamation. The Coal Segment is currently pursuing a number of different projects. On September 7 the Company announced that BTI had signed an agreement to reclaim slurry for Pinnacle Mining Company, LLC. This agreement has an initial term of six years, extendible for an additional four years if significant recoverable reserves remain at the end of the initial term. The Company is also pursuing other projects as reflected in the Schedule of Active and Potential Projects at Exhibit A. The projections reflect Project A (Pinnacle) beginning in January 2005 and running through December 2010. The projections also assume that a second pond recovery project (Project B) starts in July 2005 and runs through November 2011, that a third pond recovery project (Project C) starts in January 2006 and runs through May 2014, that a fourth pond recovery project (Project D) starts in May 2006 and runs through September 2012, and that a fifth pond recovery project (Project E) starts in September 2006 and runs through January 2013. On each of the five pond recovery projects, the projections assume that BTI receives an overhead charge of $50,000 per month for the first five months and $30,000 per month thereafter from the LLC operating the projects. The projections assume that the Company owns 60% of the five Projects and that investors own 40%. The Company has retained, on a non-exclusive basis, a New York City based firm which specializes in the private placement of debt and equity securities for energy companies (the "Placement Agent") to raise $10,500,000 of equity from institutional investors to finance the five Projects, and it is further assumed that $5,000,000 of USDA-guaranteed financing will be secured for each of the five Projects. While it is pursuing the equity funding the Placement Agent will also be pursuing the placement of debt financing of up to $24,600,000 in the event the USDA financing fails to materialize or if the equity placement should be unsuccessful. However, there is no assurance that the required equity or debt financing will be obtained, that the USDA-guaranteed loans will be obtained or that any of the projects will materialize. The projections also assume that BTI's basic overhead increases by $90,000 in 2005, by $150,000 in 2006, and by $150,000 in 2007. (b) 2004 revenues, expenses and profits of the CO2 Segment have been based upon actual results for the first ten months of 2004, with anticipated improvement in revenues and net profit beginning in 2005 due to expected better marketing and pricing and reduced pipeline charges resulting from the McElmo Dome Settlement. (c) In China the projections assume that a "mini-plant", costing $1.6 million, is funded by outside investors who receive 90% of the cash flow from the project. The projections assume that the mini-plant is started in February 2005, with payout of the investor's investment projected to occur in August 2006. Beard Environmental Engineering, LLC's ("BEE") interest in the plant will increase to 50% after investor payout. The projections also assume that a second mini-plant, with similar cost and ownership, is started in December 2005, with payout projected to occur in June 2007. It is further assumed that the operations of each of the two plants will cover $30,000 per month of the China Segment's overhead. (d) Revenues and expenses for the e-Commerce Segment have also been reflected in an anticipated worst case scenario. Revenues reflect the revenues presently anticipated from starpay's existing license agreement. starpay's basic overhead is assumed to remain at its present level of approximately $11,000 per month pending the outcome of the Visa litigation. In addition, starpay's share of the legal costs related to the lawsuit have been estimated at $30,000 for the last quarter of 2004, at $50,000 for 2005 and at $25,000 for 2006. (e) Includes all of the operating expenses of the Coal, CO2, China and e-Commerce Segments based upon the assumptions set forth in footnotes (a), (b), (c) and (d). Also assumes that Beard (Parent) overhead is at $960,000 in 2004, increases to $1,200,000 in 2005 and drops to $1,100,000 in 2006. The $240,000 increase in 2005 is to cover the estimated cost of complying with the new Sarbanes-Oxley 404 requirements. It is anticipated that the cost for SOX 404 compliance will be less after the initial year. (f) Interest expense includes the interest associated with the Parent Company debt, together with the interest cost associated with the five Coal projects discussed in footnote (a). Interest cost associated with the current offering is not included since the amount of borrowings has not yet been determined. (g) Reflects our current estimate of the net earnings expected to be received from an unconsolidated subsidiary for the periods shown. It is anticipated that this subsidiary will wind up its affairs in August of 2005. (h) These projections have been included to indicate the profitability that may be achieved if the projects outlined in footnotes (a) and (c) are implemented within the indicated time frames and if the other assumptions contained herein prove to be reasonably accurate. -----END PRIVACY-ENHANCED MESSAGE-----