SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Date of Report: November 20, 2002
TSET, INC.
(Exact Name of Registrant as Specified in Charter)
NEVADA 000-30191 87-0440410
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
464 COMMON STREET, SUITE 301, BELMONT, MASSACHUSETTS 02478
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (617) 993-9965
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ITEM 7. FINANCIAL STATEMENT, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
99.1 Business presentation to Shareholders of TSET, Inc., a Nevada
corporation ("TSET") at the annual shareholders meeting held on
November 20, 2002.
ITEM 9. REGULATION FD DISCLOSURE
On November 20, 2002, TSET held its annual shareholders meeting. The
meeting was adjourned until December 30, 2002 in Boston, Massachusetts. At the
annual shareholders meeting, management of TSET made a presentation to its
shareholders substantially in the form attached hereto as Exhibit 99.1. The
slides from the presentation are available to view at www.kronosati.com. These
materials include forward-looking statements, including statements regarding,
among other things: (a) the growth strategies of TSET; (b) anticipated trends in
TSET's industry; (c) TSET's future financing plans; and (d) TSET's ability to
obtain financing and continue operations. In addition, when used in this filing,
the words "believes," "anticipates," "intends," "in anticipation of," and
similar words are intended to identify certain forward-looking statements. These
forward-looking statements are based largely on TSET's expectations and are
subject to a number of risks and uncertainties, many of which are beyond TSET's
control. Actual results could differ materially from these forward-looking
statements as a result of changes in trends in the economy and TSET's industry,
reductions in the availability of financing and other factors. In light of these
risks and uncertainties, there can be no assurance that the forward-looking
statements contained in this filing will in fact occur. TSET does not undertake
any obligation to publicly release the results of any revision to these
forward-looking statements that may be made to reflect any future events or
circumstances.
2
SIGNATURES
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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.
TSET, INC.
Date: November 25, 2002 By: /s/ Daniel R. Dwight
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Name: Daniel R. Dwight
Its: Chief Executive Officer and President
3
EXHIBIT 99.1
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LOGO (TM) KRONOS
2002 ANNUAL STOCKHOLDERS MEETING
AGENDA
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1. 2001 - 2002 FINANCIAL RESULTS
2. Business Overview
o Proprietary Technology
o Technology Benefits
o Market Strategy and Opportunity
o Product Commercialization
3. CONCLUDING COMMENTS AND Q&A
4. TECHNOLOGY DEMONSTRATION
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LOGO KRONOS
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2001 - 2002
FINANCIAL RESULTS
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LOGO KRONOS
2001 - 2002 FINANCIAL RESULTS
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2001: FOCUSED ON BUSINESS RESTRUCTURING.
2001 PORTFOLIO OF INVESTMENTS
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o Aperion Audio
2002
o Atomic Soccer ----
o Kronos Air Technologies > LOGO KRONOS
AIR TECHNOLOGIES
o Cancer Detection International
o Cancer Treatment Centers
PRIORITIZE AND FOCUS MANAGEMENT AND RESOURCES ON KRONOS.
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LOGO KRONOS
2001 - 2002 FINANCIAL RESULTS
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2002: FOCUSED ON IMPROVING COMPANIES BALANCE SHEET.
2001 2002
TOTAL % TOTAL % V V%
------ --- ------ --- --- ----
Internal Debt: 1,470,867 57% 1,324,147 66% (146,720) -10%
External Partners:
34,602 1% 232,385 12% 197,783 572%
INTERNAL & EXTERNAL PARTNERS 1,505,469 58% 1,556,532 78% 51,063 3% 78% of liabilities
with management and
External Corporate: 1,063,336 41% 242,676 12% (820,660) -77% key external partners.
External Kronos Air: 19,958 1% 60,403 3% 40,445 203%
Other - non cash - - 143,000 7% 143,000 U
EXTERNAL 1,083,294 42% 446,079 22% (637,215) -59%
TOTAL LIABILITIES 2,588,763 100% 2,002,611 100% (586,152) -23%
REDUCED TOTAL LIABILITIES BY $586,000.
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LOGO KRONOS
2001 - 2002 FINANCIAL RESULTS
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2002: FOCUSED ON OBTAINING FUNDS TO FINANCE COMMERCIALIZATION AND INITIATE
REVENUE GENERATION IN 2003.
o EQUITY FUNDING:
>> Fusion Capital $6 million equity line of credit
>> Management Private Placement
o CUSTOMER CONTRACTS:
>> HOMEDICS:
- License Agreement;
- Development Agreement.
>> GOVERNMENT:
- U.S. Navy SBIR Phase I
- U.S. Army SBIR Phase I
- U.S. Navy SBIR Phase II.
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SEEKING TO REDUCE RELIANCE ON EQUITY LINE.
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LOGO KRONOS
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BUSINESS OVERVIEW
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LOGO KRONOS
I. COMPANY OVERVIEW
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FOCUSED ON COMMERCIALIZATION.
o UNIQUE TECHNOLOGY
o PATENTED TECHNOLOGY
o PATENTED TECHNOLOGY
o NEGOTIATED AGREEMENTS AND CURRENT DEVELOPMENTS:
- Standalone platform: HoMedics;
- Embedded platform: U.S. Navy SBIR.
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BROAD SPECTRUM OF INITIAL COMMERCIALIZATION INTEREST.
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LOGO KRONOS
I
II. PROPRIETARY TECHNOLOGY
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KRONOS HAS ACHIEVED PATENTED BREAKTHROUGHS
IN THE DEVELOPMENT OF A COST EFFECTIVE,
CORONA TECHNOLOGY THAT EFFICIENTLY CAUSES
SILENT AIR MOVEMENT AND PURIFICATION
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WITHOUT FAN BLADES, ELECTRICAL MOTORS OR FILTERS.
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LOGO KRONOS II
CORONA DISCHARGE
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EVOLUTIONARY BREAKTHROUGH IN THE MANAGEMENT OF A HIGH VOLTAGE PHENOMENON -
CORONA DISCHARGE.
Corona Electrode Target Electrode
Ions
(Negatively charged
electrode attracts
positively charged ions)
(Discharge positively
charged ions)
Gas molecules
(Ions hit gas molecules
causing an "explosion")
POWER SUPPLY
(PS provides charge to (Current returned to PS)
corona electrode)
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LOGO KRONOS II.1
INTELLECTUAL PROPERTY
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AGGRESSIVELY PURSUING THE PATENTING OF INTELLECTUAL PROPERTY.
o RECEIVED FIRST PATENT FROM US PATENT AND TRADEMARK OFFICE.
o PATENT PENDING INTERNATIONALLY.
o ADDITIONAL PATENT FILINGS MADE WITH THE US PATENT AND
TRADEMARK OFFICE.
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BUILDING A DEFENSIBLE INTELLECTUAL PROPERTY PLATFORM.
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LOGO KRONOS II.2
III. TECHNOLOGY BENEFITS
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TECHNOLOGY PROVIDES NUMEROUS PRODUCT BENEFITS.
STEALTH VERSATILITY
Virtually silent Instant air movement
EFFICIENCY PURIFICATION ANTI-STATIC
Up to 10x more Removes a wide range Neutralizes
energy efficient than of gases, bacteria and electrostatic particles
a fan particulate matter from the air
ADAPTABILITY DURABILITY
scalable in any No moving parts
shape or size
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MORE VERSATILE DEVICE THAN ANY FAN OR FILTER IN THE MARKET TODAY
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LOGO KRONOS III
PURIFICATION
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SIGNIFICANT ABILITY TO REMOVE PARTICULATES FROM THE AIR.
Object Omitted
PARTICLE ELIMINATION
Particle Size (in Microns) % REMOVED ON SINGLE PASS
0.3 99.820%
0.5 99.872%
1 99.928%
5 100.000%
SOURCE: MICROTEST LABORATORY - AUGUST 2001
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KRONOS DEVICES CAPTURE OVER 99.8% OF PARTICULATES.
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LOGO KRONOS III.1
PURIFICATION
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LETHAL TOWARDS A WIDE ARRAY OF CARCINOGENS IN SECOND HAND CIGARETTE SMOKE,
BACTERIA, AND OTHER PATHOGENS.
KRONOS SUBSTANCE ELIMINATION
HAZARDOUS SUBSTANCE % REMOVED IN SINGLE PASS
BENZENE 94.4%
AMMONIA 54.5%
STYRENE 50.0%
FORMALDEHYDE 50.0%
TOLUENE 45.0%
ACROLEIN 62.5%
ACTIVE BG (ANTHRAX) 95.0%
SOURCE: NH MATERIALS LABORATORY - AUGUST 2001
BATTELLE NORTHWEST NATIONAL LABORATORY - JULY 1999
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KRONOS DEVICES ELIMINATE 45 - 95% OF PATHOGENS.
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LOGO KRONOS III.2
AIR MOVEMENT AND EFFICIENCY
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DEVICES PROVEN TO SILENTLY MOVE AIR MORE EFFICIENTLY AT COMPETITIVE LEVELS OF
BACKPRESSURE.
o SOUND: No detectible sound readings
o ELECTRICAL CONSUMPTION: More energy efficient than a fan.
o BACKPRESSURE: Ability to move air across heating and cooling coils.
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KEY ATTRIBUTES DRIVING UNIQUE CUSTOMER INTEREST.
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LOGO KRONOS III.3
SAFETY
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LOW WATTAGE AND MINIMAL FREQUENCY INTERFERENCE RESULTS IN A SAFE AND RELIABLE
PRODUCT.
o ELECTROMAGNETIC INTERFERENCE (EMI): Passed all system safety
checks on board a "live" aircraft.
o UL SAFETY: Core electronics met UL safety standards.
o FCC APPROVAL: Pass FCC regulation for consumer devices.
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ADDRESSED ALL SAFETY CONCERNS AND ISSUES.
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LOGO KRONOS III.4
ADAPTABILITY
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DEVICES ADAPTABLE IN SHAPE, SIZE AND CAPACITY.
o STANDALONE DEVICE MAY BE MODIFIED:
- lay flat (horizontal) on top of a table or flat (vertically)
against a wall;
- built into other products.
o KRONOS HAS BUILT DEVICES THAT RANGE IN SIZE:
- bunk fans on US Naval ships;
- large embedded HVAC air movers on US Navy Destroyers.
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ADAPTABILITY OPENS DOOR TO A MULTITUDE OF UNIQUE APPLICATIONS.
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LOGO KRONOS III.5
IV. MARKET STRATEGY AND OPPORTUNITY
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STRATEGY TO EXPLOIT ITS INTELLECTUAL PROPERTY & TECHNICAL KNOW-HOW.
o ESTABLISHING BARRIERS TO ENTRY: building DEFENSIBLE intellectual
property platform and developing a LEADING market position.
o PENETRATING MULTIPLE MARKET SEGMENTS.
o QUICKLY INSERTING THE TECHNOLOGY INTO THE MARKETPLACE: building
INTERNAL CAPABILITIES, establishing strategic ALLIANCES and
LICENSING.
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SEEKING TO BECOME THE STANDARD FOR AIR MOVEMENT AND PURIFICATION.
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LOGO KRONOS IV
MARKET SEGMENTATION
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MARKET SEGMENTATION DRIVING SOLUTIONS DEVELOPMENT:
AIR MOVEMENT & PURIFICATION EMBEDDED COOLING & CLEANING
- residential - electronic devices
- hospitality - medical equipment
- health care
- commercial
SPECIALIZED MILITARY KRONOS INDUSTRIAL SCRUBBER
- naval vessels SOLUTIONS - produce storage
- closed vehicles - diesel emissions
- environmental devices
AIR PURIFICATION FOR
UNIQUE SPACES HAZARDOUS GAS DESTRUCTION
- electronics manufacturing - incineration plants
- pharmaceutical cleanrooms - chemical facilities
- cruise ships
- transportation
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LOGO KRONOS IV.1
AIR MOVEMENT & PURIFICATION
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INDOOR AIR POLLUTION CAUSED BY INADEQUATE VENTILATION AND CHEMICAL AND
BIOLOGICAL CONTAMINANTS:
o BIO-TERRORISM, FEAR AND NEW FEDERAL, STATE AND INDUSTRIAL STANDARDS.
o EPA - INDOOR AIR POLLUTION 2 - 3X HIGHER THAN OUTDOOR AIR.
o WORLD HEALTH ORGANIZATION - 30% OF BUILDINGS HAVE HIGH RATES OF "SICK
BUILDING" COMPLAINTS.
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"9/11", ANTHRAX, AND SICK BUILDING SYNDROME
ALL DRIVING MARKET OPPORTUNITY.
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LOGO KRONOS IV.3
SPECIALIZED MILITARY APPLICATIONS
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MILITARY'S NEED TO WORK IN CONFINED SPACE COMBINED WITH POTENTIAL
"ENVIRONMENTAL" HAZARDS CREATES NUMEROUS SPECIALIZED MILITARY APPLICATIONS.
o CLEAN AIR MOVEMENT TO ELIMINATE CONTAMINATES, BACTERIA AND OTHER
PATHOGENS;
o COMBAT IMPACT OF BIOLOGICAL AND CHEMICAL WEAPONS;
o DISPOSE OF CURRENT HEPA FILTERS - CLASSIFIED AS BIOLOGICAL WASTE;
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BIO-TERRORISM DRIVING NEW COMMERCIAL AND MILITARY APPLICATIONS.
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LOGO KRONOS IV.4
AIR PURIFICATION FOR UNIQUE SPACES
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ADAPTABILITY OF TECHNOLOGY ALLOWS KRONOS TO PURSUE SEVERAL APPLICATIONS WITH
UNIQUE SPACE REQUIREMENTS.
o TRANSPORTATION INDUSTRY REQUIRES CLEAN AIR MOVEMENT IN AUTOMOBILE,
CRUISE SHIP AND AIRPLANE CABINS:
o GROWING DEMAND FOR CLEANROOM ENVIRONMENTS IN THE ELECTRONICS, HEALTH
CARE AND PHARMACEUTICAL INDUSTRIES:
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SEEKING STRATEGIC PARTNERS TO DEVELOP APPLICATIONS.
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LOGO KRONOS IV.5
V. PRODUCT COMMERCIALIZATION
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FOCUSED ON COMMERCIALIZATION OF CORE TECHNOLOGY.
STANDALONE PLATFORM
o Easiest adaptability of technology;
o Leverage product development across multiple markets;
o Opportunity to generate near term revenue.
EMBEDDED PLATFORM
o More sophisticated adaptability of technology;
o Need key strategic partners to integrate Kronos technology into other
products / systems;
o Opportunity to generate significant long term revenue.
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DEVELOPING PLATFORMS IN PARALLEL.
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LOGO KRONOS V
STANDALONE PLATFORM
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INITIATE COMMERCIALIZATION OF STANDALONE PRODUCTS THROUGH KEY STRATEGIC
PARTNER(S).
Initial Strategic Partner: HOMEDICS USA, INC.
Funding: HOMEDICS LICENSING AND DEVELOPMENT AGREEMENTS
Product Development: STANDALONE ROOM AIR PURIFIER
Market: CONSUMER RETAIL, INCLUDING INTERNET, INFOMERCIALS,
AND CATALOG SALES
Territories: NORTH AMERICA, AUSTRALIA, AND NEW ZEALAND
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PRODUCT DESIGN, PRODUCTION AND MARKETING IN-PROCESS.
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LOGO KRONOS V.1
STANDALONE PLATFORM
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LEVERAGE HOMEDICS RELATIONSHIP, PRODUCTS AND FUNDING INTO . . .
.. . . NEW MARKETS
.. . . NEW TERRITORIES
.. . . NEW PRODUCTS
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BUILD NEW OPPORTUNITIES INTERNALLY AND WITH OTHER STRATEGIC PARTNERS.
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LOGO KRONOS V.2
EMBEDDED PLATFORM
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INITIATE COMMERCIALIZATION OF EMBEDDED PRODUCTS THROUGH KEY STRATEGIC PARTNERS.
Initial Strategic Partner: U.S. NAVY.
Funding: SBIR CONTRACT
Product Development: EMBEDDED HVAC SYSTEM FOR NAVAL SHIPS
Markets: NAVAL AND PASSENGER CRUISE SHIPS
Territory: UNITED STATES
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PRODUCT DESIGN AND DEVELOPMENT IN-PROCESS.
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LOGO KRONOS V.3
EMBEDDED PLATFORM
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LEVERAGE MILITARY RELATIONSHIPS, PRODUCTS AND FUNDING INTO . . .
.. . . NEW MARKETS
.. . . NEW TERRITORIES
. . . NEW PRODUCTS
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BUILD NEW OPPORTUNITIES WITH OTHER STRATEGIC PARTNERS.
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LOGO KRONOS V.4
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CONCLUDING COMMENTS
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LOGO KRONOS
CONCLUDING COMMENTS
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FOCUSED ON COMMERCIALIZATION.
o UNIQUE TECHNOLOGY
o PATENTED TECHNOLOGY
o MATERIAL MARKET OPPORTUNITY
o NEGOTIATED AGREEMENTS AND CURRENT DEVELOPMENTS:
- standalone platform: HoMedics;
- embedded platform: U.S. Navy SBIR.
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POSITIONED BUSINESS FOR GROWTH IN 2003.
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LOGO KRONOS