-----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, FT8qUpRTaai+M+eDCDs8WE90gZntA3q+JRM44OrUbC2P5YDRjhFNSdeRh8bB2Gb7 0XyFjWilzLkCkGEUc8dOFg== 0001144204-03-002613.txt : 20030516 0001144204-03-002613.hdr.sgml : 20030516 20030516152356 ACCESSION NUMBER: 0001144204-03-002613 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20030512 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030516 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ION NETWORKS INC CENTRAL INDEX KEY: 0000754813 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 222413505 STATE OF INCORPORATION: DE FISCAL YEAR END: 1202 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-13117 FILM NUMBER: 03708457 BUSINESS ADDRESS: STREET 1: 1551 S WASHINGTON AVE CITY: PISCATAWAY STATE: NJ ZIP: 08854 BUSINESS PHONE: 2014944440 MAIL ADDRESS: STREET 1: 1551 S WASHINGTON AVE CITY: PISCATAWAY STATE: NJ ZIP: 08854 FORMER COMPANY: FORMER CONFORMED NAME: MICROFRAME INC DATE OF NAME CHANGE: 19920703 8-K 1 doc1.txt UNITED STATES 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): May 12, 2003 ION NETWORKS, INC. ------------------------------------------------------------------------ (Exact Name of Registrant as Specified in its Charter) Delaware 000-13117 22-2413505 - ----------------------------------------------------------------------------- (State or Other Jurisdiction (Commission File Number) (I.R.S. Employer of Incorporation) Identification No.) 1551 South Washington Avenue Piscataway, New Jersey 08854 - ---------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) (Registrant's telephone number, including area code): (732) 529-0100 Not Applicable - ------------------------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (a) Financial Statements of Businesses Acquired. Not applicable. (b) Pro Forma Financial Information. Not applicable. (c) Exhibits. EXHIBIT NO. DESCRIPTION 99.1 Press release of the Company dated May 12, 2003, announcing its financial results for the three month period ended March 31, 2003. 99.2 Transcript of the conference call hosted by the Company on May 12, 2003, discussing the Company's financial results for the three month period ended March 31, 2003. ITEM 9. REGULATION FD DISCLOSURE (THE FOLLOWING DISCUSSION IS FURNISHED UNDER "ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION") In accordance with SEC Release No. 33-8216, the following information, required to be furnished under "Item 12. Results of Operations and Financial Condition," is furnished under "Item 9. Regulation FD Disclosure." On May 12, 2003, ION Networks, Inc. (the "Company") issued a press release and hosted a conference call regarding its financial results for the three month period ended March 31, 2003. A copy of the Company's press release and a transcript of the conference call are attached hereto as Exhibits 99.1 and 99.2, respectively. This Form 8-K and the exhibits attached hereto are provided under Item 12 of Form 8-K and are furnished to, but not filed with, the Securities and Exchange Commission. 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. Date: May 16, 2003 ION NETWORKS, INC. By: /s/ Cameron Saifi ---------------------------------- Cameron Saifi Executive Vice President and Chief Operating Officer EXHIBIT INDEX EXHIBIT NO. DESCRIPTION ----------- ----------- 99.1 Press release of the Company dated May 12, 2003, announcing its financial results for the three month period ended March 31, 2003. 99.2 Transcript of the conference call hosted by the Company on May 12, 2003, discussing the Company's financial results for the three month period ended March 31, 2003. EX-99.1 3 doc2.txt EXHIBIT 99.1 ION LOGO PRESS RELEASE =============================================================================== FOR IMMEDIATE RELEASE CONTACTS Investors: Joseph Zappulla Wall Street Investor Relations Corp. 212-714-2445 investor-relations@ion-networks.com Press: Jonathan Brown ION Networks, Inc. 732-529-0024 Jonathan.brown@ion-networks.com ION NETWORKS REPORTS FINANCIAL RESULTS FOR FIRST QUARTER ENDED MARCH 31, 2003 PISCATAWAY, N.J May 12, 2003--ION Networks Incorporated (OTC: IONN), a provider of security and management solutions that protect critical infrastructure from internal and external security threats, today announced results for its first fiscal quarter ended March 31, 2003. Net sales for the quarter ended March 31, 2003 were approximately $765,000 compared to approximately $853,000 in the previous quarter ended December 31, 2002. Net sales were approximately $2,076,000 in the quarter ended March 31, 2002. The Company incurred a net loss for the quarter ended March 31, 2003 of approximately $875,000 or $0.04 per share. This compares with a net loss of approximately $2.2 million or $0.10 per share for the previous quarter and approximately $1.2 million or $0.06 per share for the quarter ended March 31, 2002. -------------------------------- ------------------------------------ Three months Ended (Unaudited)* 3/31/03 3/31/02 Net sales $765 $2,076 Operating Loss $(877) $(1,209) Net loss $(875) $(1,218) Net loss per share $ (0.04) $ (0.06) Basic and diluted shares 23,512,668 18,890,609 -------------------------------- --------------- -------------------- *In 000s except "per share" amounts For the quarter ended March 31, 2003, gross margins were 68 percent, compared to 40 percent for the previous quarter and 54 percent for the quarter ended March 31, 2002. CONFERENCE CALL ION Networks will host a conference call at 5 p.m. (EST) today, Monday, May 12, to discuss the Company's financial results for the quarter. The conference call can be accessed by dialing 800-621-5346 and providing the following reservation number: 21144003. It is recommended that participants call at least 10 minutes before the call is scheduled to begin. ABOUT ION NETWORKS ION Networks, Inc. is a provider of security and management solutions that protect critical information and infrastructure from internal and external security threats. The ION Secure suite helps customers protect critical infrastructure and maximize operational efficiency while lowering operational costs. ION Networks' customers include AT&T, Bank of America, British Telecom, Citigroup, Entergy, Fortis Bank, Oracle, Sprint and the U.S. Government. Headquartered in Piscataway, New Jersey, the Company has installed tens of thousands of its products worldwide. More information can be obtained from www.ion-networks.com. ION Networks(TM) and ION Secure(TM) are trademarks of ION Networks, Incorporated. All other trademarks and registered trademarks in this document are the properties of their respective owners. Any statements contained in this press release that do not describe historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained herein are based on current expectations, but are subject to a number of risks and uncertainties. These statements include, but are not limited to, statements regarding the Company's plans to secure additional capital and the Company's ability to gain further market recognition. The factors that could cause actual future results to differ materially from the forward-looking statements include the following: fluctuations in customer demand; changes in the Company's sales force and management; fluctuations in spending on technology generally and security solutions in particular; insufficiency of operating capital; general economic conditions (both domestic and abroad); the rapid technological change which characterizes the Company's markets; the risks associated with competition; the risks associated with the expansion of the Company's sales channels; the risk of new product introductions and customer acceptance of new products; the risks associated with international sales as the Company expands its markets; and the ability of the Company to compete successfully in the future, as well as other risks identified in the Company's Securities and Exchange Commission Filings, including but not limited to those appearing within the Company's most recent Form 10-KSB and amendments thereto, and form 10-QSB, respectively filed with the Securities and Exchange Commission on August 21, 2002 and November 14, 2002. ***** Financial Tables Follow ***** ION Networks, Inc and Subsidiaries Consolidated Balance Sheets (Unaudited)
March December 31, 31, 2003 2002 2003 ASSETS (Unaudited) 2002 --------------- ---------------- Current assets Cash and cash equivalents $ 397,185 $ 865,684 Accounts receivable, less allowance for doubtful accounts of $90,799, and $90,521, respectively 453,985 561,762 Inventory, net 1,174,182 1,259,268 Prepaid expenses and other current assets 121,549 203,934 --------------- ---------------- Total current assets 2,146,901 2,890,648 Restricted cash - 125,700 Property and equipment, net 418,694 485,735 Capitalized software, less accumulated amortization of $4,083,247 and $3,920,223, respectively 672,202 764,429 Other assets 4,115 14,878 --------------- ---------------- Total assets $3,241,912 $4,281,390 =============== ================ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Current portion of capital leases $ 89,033 $ 87,057 Current portion of long-term debt 5,890 4,004 Accounts payable 1,099,265 1,195,023 Accrued expenses 1,044,974 906,154 Accrued payroll and related liabilities 128,461 185,358 Deferred income 129,384 155,021 Sales tax payable 73,381 84,025 Other current liabilities 91,031 89,317 --------------- ---------------- Total current liabilities $ 2,661,419 $2,705,959 --------------- ---------------- Long term portion of capital leases 50,538 73,551 Long term debt, net of current portion - 5,717 Commitments and contingencies Stockholders' Equity Preferred stock - par value $.001 per share; authorized 1,000,000 shares at March 31, 2003, and December 31, 2002; 200,000 shares designated Series A at March 31, 2003 and December 31, 2002; 166,835 shares issued and outstanding at March 31, 2003 and December 31, 2002 167 167 Common stock - par value $.001 per share; authorized 50,000,000 shares at March 31, 2003 and December 31, 2002; 24,875,500 shares issued and outstanding at March 31, 2003 24,875,500 shares issued and outstanding at December 31, 2002 24,876 24,876 Additional paid-in capital 44,585,740 44,680,740 Notes receivable from officers (480,658) (473,405) Deferred compensation - - Accumulated deficit (43,597,858) (42,722,946) Accumulated other comprehensive income (2,312) (13,269) --------------- ---------------- Total stockholder's equity 529,955 1,496,163 --------------- ---------------- Total liabilities and stockholders' equity $3,241,912 $ 4,281,390 =============== ================ =============== ================
ION Networks, Inc and Subsidiaries Consolidated Statement Of Operations (Unaudited)
Three Months Ended Three Months, Ended March 31, March 31, 2003 2002 --------------- ------------------ Net sales $ 765,119 $ 2,076,197 Cost of sales 243,988 961,085 --------------- ------------------ Gross Margin 521,131 1,115,112 --------------- ------------------ Research and development expenses 137,399 171,116 Selling, general and administrative expenses 1,026,703 1,714,159 Depreciation and amortization expenses 234,115 439,296 --------------- ------------------ Loss from operations (877,086) (1,209,459) Interest income 9,543 22,924 Interest expense (7,369) (6,647) --------------- ------------------ (874,912) (1,193,182) Loss before income taxes Income tax expense - 24,364 --------------- ------------------ Net loss $ (874,912) $ (1,217,546) =============== ================== Per share data Basic and diluted $ (0.04) $ (0.06) Weighted average number of common shares outstanding Basic and diluted 23,512,668 18,890,609
EX-99.2 4 doc3.txt EXHIBIT 99.2 ION NETWORKS 1Q03 CONFERENCE CALL TRANSCRIPT MAY 12, 2003 5PM. EDT INTRODUCTION (JOE ZAPPULLA - WALL STREET INVESTMENT CORP.) Good afternoon, everyone. Welcome to ION Networks first quarter 2003 conference call. Just as a reminder, ION changed its fiscal year to a calendar year beginning in January 2003. By now, all of you should have seen the earnings announcement. If you didn't get a copy, please call ION Networks at 800-395-7450 or go to www.ion-networks.com, where you will be able to download the earnings press release. On the call with us today is Kam Saifi, President and Chief Executive Officer and Stephen Deixler, ION's interim Chief Financial Officer. I would like to remind you that some of the comments made on today's conference call and some of the responses to your questions may contain forward-looking statements. Such statements are subject to the risks and uncertainties as described in the company's press releases and other SEC documents. I would now like to turn the call over to Kam Saifi. Kam Saifi: Before we get into the status of our business, I'd like to have Steve Deixler, our interim Chief Financial Officer, summarize our financial results for ION's first quarter ended March 31, 2003. Steve. STEVE DEIXLER: Thanks Kam. As reported, net sales for the quarter ended March 31, 2003 were approximately $ 765,000 compared to approximately $853,000 in the previous quarter ended December 31, 2002. Net sales were approximately $ 2,076,000 in the quarter ended March 31, 2002. The Company incurred a net loss for the quarter ended March 31, 2003 of approximately $875,000 or four cents per share, which includes a lease abandonment charge of $123,510. This compares with a net loss of approximately $2,220,000 or ten cents per share for the previous quarter and approximately $1,218,000 or six cents per share for the quarter ended March 31, 2002. For the quarter ended March 31, 2003, gross margins were 68 percent, compared to 40 percent for the previous quarter and 54 percent for the quarter ended March 31, 2002. The increase in gross margin is mainly due to lowering the costs associated with manufacturing of the appliances and lack of larger sales orders that typically require higher volume discounts. I'll now hand back to Kam for the continuation of the call. Kam. KAM SAIFI: Thanks Steve. Last quarter, ION Networks continued to face challenges including poor economic conditions and a general softness in IT spending. However, our sales pipeline remains strong and we are currently involved in a number of proposals of significant value in the enterprise, service provider and government sectors that we're working diligently to close. During the quarter ended March 31, 2003, we sold to a total of 37 customers compared to 40 customers in the previous quarter ended December 31, 2002; extended our relationship with our key channel partners which included being involved in the latest SIEMENS MAC catalog; and launched a new web-based marketing campaign. Despite our financial uncertainties, we continue to control our expenses and strive to make progress to reach our revenue breakeven point. As a result of recent cost reductions, we estimate that we will reach breakeven at a revenue level of approximately $2 million per quarter, which is considerably lower than our earlier estimate of $3.2 million per quarter. As you know, we have been trying since August 2002 to secure additional capital. To date, we have not been able to secure this additional funding. Nonetheless we have not given up in our efforts to secure financing for ION and are still pursuing various alternatives. However, there is no assurance we can raise additional capital on any terms reasonably acceptable to the Company. In closing, despite all the challenges we have been facing, everyone at ION Networks continues to work diligently to fulfill orders, grow our pipeline and secure new business as well as pursue various financing alternatives to move ION Networks forward. Our entire company remains centered on a common goal of increasing sales by aggressively marketing our leading-edge infrastructure security solutions to grow revenue in this tough economic climate. We remain excited regarding ION's solutions and are working hard to reach and surpass the goals we have set for ION. That concludes our formal statement and I would now like to open the call up for questions. NO QUESTIONS WERE ASKED KAM SAIFI: I would like to thank our shareholders for their loyalty as we persevere through the current economically challenging times. We are committed to developing ION's market and achieving maximum shareholder value. We look forward to presenting our progress at the next quarterly conference call. -----END PRIVACY-ENHANCED MESSAGE-----