UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
ANNUAL REPORT ON FORM 10-K/A
(Amendment No. 2)
/x/ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 2000
Commission file number 0-21391
TURBODYNE TECHNOLOGIES INC.
| Delaware (State or other jurisdiction of incorporation or organization) | 95-4699061 (I.R.S. Employer Identification No.) |
6155 Carpinteria Avenue, Carpinteria, California 93013
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code:(805) 684-4551
Securities registered pursuant to Section 12(b) of the Act:None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, par value $.001
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. YES [X]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ]
At April 9, 2001, there were outstanding 62,581,213 shares of the common stock of the registrant and the aggregate market value of the shares held on that date by non-affiliates of the registrant, based on the closing price of the registrant's common stock on the Pink Sheets on that date was $9,807,565.
DOCUMENTS INCORPORATED BY REFERENCE
None.
This Report is filed to amend our Annual Report on Form 10-K for the year ended December 31, 2000 filed with the Securities and Exchange Commission on April 19, 2001, as amended by Amendment No. 1 filed with the Commission on April 30, 2001. This Amendment No. 2 is filed to amend and restate Items 10 and 12.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Information is set forth below with respect to each of our directors and the year in which they were first elected as a director. Each director has furnished the information as to his beneficial ownership of common stock as of April 17, 2001 and, if not employed by us, each director's principal occupation. Ages are shown as of April 17, 2001.
| Name | Age | Position | Director Since | |||
|---|---|---|---|---|---|---|
| Mugurdich B. Balabanian | 60 | Chairman of the Board and Director | 2001 | |||
| Peter Kitzinski | 33 | Director | 1999 | |||
| Wendell R. Anderson | 67 | Director | 1995 | |||
| Sadayappa Durairaj | 57 | Director | 1996 | |||
| Daniel Geronazzo | 70 | Director | 1995 | |||
| Robert F. Taylor | 61 | Director | 1996 | |||
| Frank Walter | 32 | Director | 2001 | |||
| Naresh Saxena | 59 | Director | 2000 | |||
| Rainer Wollny | 55 | Director | 2001 | |||
| Erwin Kramer | 48 | Director | 2000 | |||
| Gerhard E. Delf | 62 | Director | 1999 |
Mr. Balabanian has served as a director and as chairman of the board since 2001. Since 1997, Mr. Balabanian has served as a member of the board of First Commerce Bank and, since 1999, as a member of the board of Global Vision Inc. Mr. Balabanian also served as chairman of the board of Vapor Technologies Services from 1995 to 1997. Mr. Balabanian has been in private practice in nephrology and internal medicine since 1985. Mr. Balabanian is also an assistant clinical professor at UCLA Medical Center.
Mr. Kitzinski has served as a director since 1999. He has also served as Vice President Corporate Finance Europe of Turbodyne Technologies Inc. and as General Manager of Turbodyne Europe GmbH since 1997. Prior to that, Mr. Kitzinski worked in Germany in the investment banking industry. He holds degrees in Economics and in Business Administration from the University of Muenster and the University of Wuerzburg, Germany.
Mr. Anderson has served as a director since 1995. Mr. Anderson is an attorney with the firm of Larkin, Hoffman, Daly and Lindgren Ltd. of Bloomington, Minnesota and has been practicing law since 1963. Mr. Anderson served as a state representative from Minnesota from 1959 to 1963 and as state senator from 1963 to 1971. In 1971, Mr. Anderson was elected as Governor of the State of Minnesota. Mr. Anderson served as a United States Senator from the State of Minnesota from 1977 to 1979. During his term, he served on various committees including the environment and public works committee, the budget committee, the natural resources committee and the armed services committee. Mr. Anderson serves as a director of FingerHut Companies Inc., a database marketing company listed on the New York Stock Exchange, which sells a broad range of products through catalogs, direct marketing and the Internet. Mr. Anderson also serves as a director of National City Bancorp, a Nasdaq listed company, and ECOS Group, Inc., a company listed on the OTC Bulletin Board and involved in waste management services. In December 1999, he was named one of Minnesota's most influential people of the 20th century by the Minneapolis Star Tribune. He also serves as Honorary Consul General for Sweden in Minnesota.
Dr. Durairaj has served as a director since 1996. Dr. Durairaj was chairman and founder of Pacific Baja. Dr. Durairaj obtained his medical degree from Madural Medical College in India in 1996 and is
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certified by the American Board of Internal Medicine and the Canadian Board of Internal Medicine and Cardiology. Since 1994, he has served as president and chief executive officer of Pacifica Hospital and Sierra Medical Clinic. He also serves as associate clinical professor of medicine at the University of Southern California. In addition, he is the chairman of the board of First Commerce Bank (California) and VSK Ferro Alloys (India).
Mr. Geronazzo has served as a director since 1995. Mr. Geronazzo has been an attorney in private practice in British Columbia for the past 35 years. Mr. Geronazzo has practiced as a sole practitioner since 1991. He specializes in corporate, real estate and financial law. He obtained his bachelor's degree in Business Administration from Washington State University and his LLB from the University of British Columbia.
Mr. Taylor has served as a director since 1996. Mr. Taylor is a Chartered Accountant and a member of the Institute of Chartered Accountants of Alberta, Canada. Prior to that, since 1993, he served as president of Shell Canada Products. Mr. Taylor served with Shell in various capacities from 1967 in Calgary, Toronto and London, England where he worked with Shell International Petroleum Company as Area Coordinator for West and East Africa. From January to June 1997, he also served as our chief operating officer. Mr. Taylor is currently a director of Pembina Pipeline Corporation, a publicly owned income fund, and McTay Holdings Limited, a private company. Mr. Taylor is a trustee of the United Kingdom Fund of The Duke of Edinburgh's Commonwealth Study Conference. He was recently honored by the Queen who appointed him a Lieutenant of the Royal Victorian Order.
Mr. Walter has served as a director since 2001. Mr. Walter has been a self-employed financial consultant since 1994. From 1991 to 1994, Mr. Walter was area manager for industrial services with a German company. Mr. Walter received a degree in economics from the University of Applied Sciences in Darmstadt.
Mr. Saxena has served as a director since 2000. Since 1976, Mr. Saxena has been a thoracic and cardiac surgeon at Valley Presbyterian Hospital in Van Nuys, California. He also served as Chief of Medical Staff at Valley Presbyterian Hospital from 1995 to 1997. In addition, Mr. Saxena serves on the boards of First Commerce Bank, Global Vision and Pacifica Optima Partners.
Mr. Wollny has served as a director since 2001. Since 1992, Mr. Wollny has served as chief executive officer in several German and Irish companies that are engaged primarily in the business of real estate investments.
Mr. Kramer has served as a director since 2000. Since 1972, Mr. Kramer has been an independent advisor to private companies and individuals providing auto-didactical study of the financial markets with an emphasis on shareholder value. In 1994, he provided advisory assistance to the Baltic states with an emphasis on strategic reorientation. From 1996 to 1998, Mr. Kramer provided project consultation services for the introduction of quality assurance.
Mr. Delf has served as a director since 1999. He also served as our president and chief executive officer from October 1999 until October 2000 and from November 2000 until January 2001. Prior to being appointed chief executive officer, Mr. Delf served as executive vice president of Dynacharger OEM Programs. Prior to that, Mr. Delf was employed by Volkswagen AG and Volkswagen of America for 20 years, where for the last 12 years he held the position of chief engineer for Powertrain and Emissions. He was responsible for product engineering and introduction to production for gasoline and diesel engines, manual and automotive transmissions, and engine and transmission controls. Prior to that, Mr. Delf was manager for United States Emission Certification and Principal Engineer for electronic fuel injection and US emission controls. Additionally, Mr. Delf has been an advisor to the United States National Research Council on Combustion Engine Technology and Energy Utilization and served as a member of the Motor Vehicle Council of the Society of Automotive Engineers. He has also been an expert advisor for the United States Senate, the California Energy Commission, the
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United States Environmental Protection Agency, and the California Air Resources Board, on proposed emissions and fuel economy regulations, as well as advanced engine technologies.
The standing committees of our board are the Audit Committee, the Compensation Committee, the Stock Option Committee, the Executive Committee and the Special Committee. The Audit Committee presently consists of Messrs. Geronazzo and Taylor and met five times in 2000. The Compensation Committee presently consists of Messrs. Durairaj and Anderson and met four times in 2000. The Stock Option Committee currently consists of Messrs. Durairaj and Anderson and met five times in 2000. The Executive Committee consists of Messrs. Taylor, Kitzinski and Anderson and met five times during 2000. The Special Committee currently consists of Messrs. Taylor, Durairaj, Anderson and Geronazzo and met three times during 2000.
Audit Committee. The Audit Committee was established in 1998 to:
Compensation Committee. The Compensation Committee was established in 1997. None of the members of the Compensation Committee has ever been employed by us. The Compensation Committee considers and makes recommendations to the board regarding executive compensation.
Stock Option Committee. The Stock Option Committee was established in 1997. The Stock Option Committee is responsible for administering our stock option and executive incentive compensation plans. None of the members of the Stock Option Committee have ever been employed by us.
Executive Committee. The Executive Committee was established in 1999. Subject to certain limitations, the board delegated all of its authority to the Executive Committee. This committee was dissolved in November 2000.
Special Committee. The Special Committee was established in 1999 to investigate allegations of the National Association of Securities Dealers and NASDAQ Europe concerning the accuracy of certain of our press releases.
During fiscal 2000, the board held 13 meetings and took various actions by written consent. Each director attended at least 75% of the total number of meetings held by the board and the total number of meetings held by all committees of the board during the period within which he was a member of such committee.
The board is divided into three classes that are elected for staggered three-year terms. The term of each class expires as follows:
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Each director serves until the end of his term and until his successor has been elected and qualified.
The directors are reimbursed for reasonable out-of-pocket expenses in connection with their attendance at board and committee meetings. They are also periodically granted options to purchase our common stock at the discretion of the Stock Option Committee. During 2000, Messrs. Geronazzo and Delf received $9,300 in housing costs. In addition, Messrs. Geronazzo and Delf were each provided with a car.
Compensation Committee Interlocks and Insider Participation
No interlocking relationship exists between our board of directors and the compensation committee of any other company.
Limitation of Liability and Indemnification Matters
Our certificate of incorporation limits the liability of directors to the maximum extent permitted by Delaware law. Delaware law provides that directors of a company will not be personally liable for monetary damages for breach of their fiduciary duties as directors, except for liability (1) for any breach of their duty of loyalty to the company or its stockholders, (2) for acts or omissions not in good faith that involve intentional misconduct or a knowing violation of law, (3) for unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law, or (4) for any transaction from which the director derived an improper personal benefit.
Set forth in the table below are the names, ages and positions of our current executive officers. Ages are shown as of April 17, 2001. Executive officers are elected by and serve at the discretion of the board. None of the executive officers has any family relationship to any director or to any other executive officer.
| Name | Age | Position | ||
|---|---|---|---|---|
| Kenneth F. Fitzpatrick | 60 | Chief Executive Officer and President | ||
| Joseph Castano | 40 | Chief Financial Officer and Secretary | ||
| Duane Rosenheim | 68 | Chief Operating Officer |
Set forth below is a brief description of the business experience for the previous five years of all current executive officers
Mr. Fitzpatrick has served as President and Chief Executive Officer since 2001. Prior to that, he served as Vice President—Investor Relations since 1997. Prior to that, since 1992, Mr. Fitzpatrick was with Vansan Group, which provides consulting services to companies with respect to financing and investor relations.
Mr. Castano was appointed as Chief Financial Officer on September 28, 1999 and Secretary on October 22, 1999. Prior to that, Mr. Castano was Chief Financial Officer and Chief Operating Officer of SurgiNet, LLC, a healthcare provider company, from 1996 to September 1999. From January 1991 to February 1996, he was an administrator with UCLA. From May 1989 to January 1991, Mr. Castano served as a Regional Manager of Xerox Credit Corporation. From September 1984 to April 1989, he was a Vice President with Nationwide Lease Associates, an asset based finance organization. Mr. Castano started his business career with J. Henry Schroeder Bank in August 1982. Mr. Castano is a
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graduate of the Wharton School of Business at the University of Pennsylvania. He received a Masters of Business Administration from Pepperdine University in April 2000. Mr. Castano is a candidate for Fellow of the American College of Medical Practice Executives and a member of the Financial Executives Institute. Mr. Castano is currently studying for his Certified Financial Analyst—Level I exam.
Mr. Rosenheim was appointed Chief Operating Officer of the Company in June 1998. Prior thereto, and for the past six years, Mr. Rosenheim was an independent consultant working primarily with us to develop our prototype product which has been incorporated into the Turbopac(TM) and Dynacharger(TM) products. From 1960 to 1992, Mr. Rosenheim served in several positions at the Delco Electronics Division of General Motors Corporation, including Quality Engineering Manager and Manager of the Quality, Manufacturing and Operations Administration Departments.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding beneficial ownership of our common stock as of March 29, 2001 by: (1) each person (or group of affiliated persons) who is known by us to own beneficially more than 5% of our common stock, (2) each of our directors, (3) each of the named executive officers, and (4) all of the directors and executive officers as a group. Except as indicated in the footnotes to this table, the persons named in the table, based on information provided by such persons, have sole voting and sole investment power with respect to all shares of our common stock shown as beneficially owned by them, subject to community property laws where applicable. The
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address of each person listed is in care of Turbodyne, 6155 Carpinteria Avenue, Carpinteria, California 93013, unless otherwise indicated.
| Name and Address of Beneficial Owner | Common Stock Beneficially Owned(1) | Percentage of Common Stock Beneficially Owned | |||
|---|---|---|---|---|---|
| Edward M. Halimi c/o American Appliance 6155 Carpinteria Avenue Carpinteria, California 90313 | 6,160,956 | (2) | 9.6 | % | |
| Gerhard Delf | 750,000 | (3) | 1.2 | % | |
| Wendell R. Anderson | 365,782 | (4) | * | ||
| Sadayappa Durairaj | 5,496,709 | (5) | 5.5 | % | |
| Daniel D. Geronazzo | 215,000 | (6) | * | ||
| Robert F. Taylor | 233,498 | (7) | * | ||
| Peter Kitzinski | 227,465 | (8) | * | ||
| Kenneth F. Fitzpatrick | 220,000 | (9) | * | ||
| Mugurdich Balabanian | 4,187,456 | (10) | 6.5 | % | |
| Frank Walter | 650,078 | (11) | 1.0 | % | |
| Naresh C. Saxena | 2,069,318 | (12) | 3.3 | % | |
| Erwin Kramer | 545,500 | (13) | * | ||
| Rainer Wollny | 286,000 | * | |||
| Duane Rosenheim | 100,000 | (14) | * | ||
| Joseph Castano | 300,000 | (15) | * | ||
| All directors and executive officers as a group (14 persons) | 15,646,306 | 22.1 | % |
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Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Amendment No. 2 to be signed on its behalf by the undersigned, thereunto duly authorized.
| TURBODYNE TECHNOLOGIES, INC. | ||||
By: | /s/ KENNETH F. FITZPATRICK Kenneth F. Fitzpatrick | |||
Date: | May 22, 2001 | |||
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Kenneth F. Fitzpatrick and Joseph D. Castano, or any one of them, his attorney-in-fact and agent, with full power of substitution, for him in any and all capacities, to sign any amendments to this Annual Report, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that said attorneys-in-fact, or their substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated.
| SIGNATURE | TITLE | DATE | ||
|---|---|---|---|---|
| /s/ MUGURDICH BALABANIAN Mugurdich Balabanian* | Chairman of the Board | May 22, 2001 | ||
/s/ KENNETH F. FITZPATRICK Kenneth F. Fitzpatrick | President, Chief Executive Officer and Director | May 22, 2001 | ||
/s/ JOSEPH D. CASTANO Joseph D. Castano* | Chief Financial Officer and Secretary (Principal Financial and Accounting Officer) | May 22, 2001 | ||
/s/ ROBERT F. TAYLOR Robert F. Taylor* | Director | May 22, 2001 | ||
/s/ GERHARD E. DELF Gerhard E. Delf* | Director | May 22, 2001 |
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/s/ WENDELL R. ANDERSON Wendell R. Anderson* | Director | May , 2001 | ||
/s/ SADDYAPA DURAIRAJ Saddyapa Durairaj* | Director | May , 2001 | ||
/s/ NARESH SAXENA Naresh Saxena* | Director | May , 2001 | ||
/s/ RAINER WOLLNY Rainer Wollny* | Director | May , 2001 | ||
/s/ FRANK WALTER Frank Walter* | Director | May , 2001 | ||
/s/ ERWIN KRAMER Erwin Kramer* | Director | May , 2001 | ||
/s/ DANIEL GERONAZZO Daniel Geronazzo* | Director | May , 2001 | ||
/s/ PETER KITZINSKI Peter Kitzinski* | Director | May , 2001 |
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