-----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, LnietTd3uZcQeL+lJNv9OGsC8lL82CsDXmjGW6cE/rcmFkrPDFoZtCXtRlXX6i6+ oIqT99jLxMlYNlJ45LkREQ== 0000950150-97-000786.txt : 19970520 0000950150-97-000786.hdr.sgml : 19970520 ACCESSION NUMBER: 0000950150-97-000786 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19970331 FILED AS OF DATE: 19970515 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: SPATIALIZER AUDIO LABORATORIES INC CENTRAL INDEX KEY: 0000890821 STANDARD INDUSTRIAL CLASSIFICATION: 3674 IRS NUMBER: 954484725 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-26460 FILM NUMBER: 97606352 BUSINESS ADDRESS: STREET 1: 20700 VENTURA BOULEVARD SUITE 134 STREET 2: STE 1100 CITY: WOODLAND HILLS STATE: CA ZIP: 91364 BUSINESS PHONE: 3102682700 10-Q 1 FORM 10-Q FOR THE PERIOD ENDED MARCH 31, 1997 1 ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------- FORM 10-Q ------------- (MARK ONE) [X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the period ended: MARCH 31, 1997 OR [ ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Commission File Number: 33-90532 SPATIALIZER AUDIO LABORATORIES, INC. (Exact name of registrant as specified in its charter) DELAWARE 95-4484725 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 20700 VENTURA BOULEVARD, SUITE 134 WOODLAND HILLS, CALIFORNIA 91364-2357 (Address of principal executive offices) TELEPHONE NUMBER: (818) 227-3370 (Registrant's telephone number, including area code) 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 NO --- --- As of May 9, 1997 there were 20,806,429 shares of the Registrant's Common Stock outstanding. ================================================================================ 2 PART I. FINANCIAL INFORMATION ITEM I. FINANCIAL STATEMENTS SPATIALIZER AUDIO LABORATORIES, INC. AND SUBSIDIARIES Consolidated Balance Sheets
MARCH 31, DECEMBER 31, 1997 1996 ------------ ------------ (unaudited) ASSETS Current Assets: Cash and Cash Equivalents $ 2,389,033 $ 1,587,395 Trade Receivables 811,020 820,856 Inventory 239,854 296,539 Prepaid Expenses and Deposits 173,442 260,984 ------------ ------------ Total Current Assets 3,613,349 2,965,774 Fixed Assets, Net (Note 3) 710,999 622,856 Intangible Assets (Note 4) 497,170 451,733 Other Assets 102,653 100,832 ------------ ------------ $ 4,924,171 $ 4,141,195 ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Accounts Payable $ 256,382 $ 403,870 Accrued Liabilities 246,906 333,152 Advances from Related Parties (Note 5) 112,500 112,500 Notes Payable 80,464 23,800 ------------ ------------ Total Current Liabilities 696,252 873,322 ------------ ------------ Shareholders' Equity: Preferred shares, $.01 par value, 1,000,000 shares authorized, no shares issued or outstanding -- -- Common shares, $.01 par value, 50,000,000 shares authorized, 20,806,429 and shares issued and outstanding at March 31, 1997 and December 31, 1996, respectively 208,064 191,154 Additional Paid-In Capital 40,497,750 38,527,775 Accumulated Deficit (36,477,895) (35,451,056) ------------ ------------ Total Shareholders' Equity 4,227,919 3,267,873 ------------ ------------ $ 4,924,171 $ 4,141,195 ============ ============
See accompanying notes to consolidated financial statements 1 3 SPATIALIZER AUDIO LABORATORIES, INC. AND SUBSIDIARIES Consolidated Statements of Operations (unaudited)
FOR THE THREE MONTH PERIOD ENDED ---------------------------------- MARCH 31, MARCH 31, 1997 1996 ------------ ------------- Revenues: Product Revenues $ 120,747 $ 82,929 Licensing Revenues 397,715 345,635 ------------ ------------ 518,462 428,564 Cost of Revenues 64,255 30,720 ------------ ------------ 454,207 397,844 ------------ ------------ Operating Expenses: General and Administrative 573,098 547,466 Research and Development 568,829 227,186 Sales and Marketing 341,358 415,000 ------------ ------------ 1,483,285 1,189,652 ------------ ------------ Operating Loss (1,029,078) (791,808) Interest and Other Income 9,459 42,271 Interest and Other Expense (4,320) (4,057) ------------ ------------ 5,139 38,214 Loss Before Income Taxes $ (1,023,939) $ (753,594) Income Taxes (2,898) (800) Net Loss $ (1,026,839) $ (754,394) ============ ============ Net Loss Per Common Share $ (0.08) $ (0.06) ============ ============ Weighted Average Common Shares Outstanding 13,120,862 11,777,889 ============ ============
See accompanying notes to consolidated financial statements 2 4 Consolidated Statements of Cash Flows (unaudited)
THREE MONTHS ENDED -------------------------------- MARCH 31, MARCH 31, 1997 1996 ----------- ------------ Cash Flows from Operating Activities: Net Loss $(1,026,839) $ (754,394) Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and Amortization 56,857 18,170 Net Change in Assets and Liabilities: Trade Receivable 9,836 (85,045) Inventory 56,685 (24,095) Prepaid Expenses and Deposits 87,542 (8,622) Accounts Payable (147,488) 149,207 Accrued Liabilities (86,246) (90,346) ----------- ----------- Net Cash Used in Operating Activities (1,049,653) (795,125) ----------- ----------- Cash Flows from Financing Activities: Issuance of Common Shares. net 1,986,885 157,978 Due to Related Parties -- (212,561) Issuance of Notes Payable 59,532 -- Repayments of Notes Payable (2,868) (1,725) ----------- ----------- Net Cash Provided by Financing Activities 2,043,549 (56,308) ----------- ----------- Cash Flows from Investing Activities: Purchase of Fixed Assets (145,000) (69,229) Increase in Intangible Assets (47,258) (54,038) ----------- ----------- Net Cash Used in Investing Activities (192,258) (123,267) ----------- ----------- Increase (Decrease) in Cash and Cash Equivalents 801,638 (974,700) Cash and Cash Equivalents, Beginning of Period 1,587,395 3,113,057 =========== =========== Cash and Cash Equivalents, End of Period $ 2,389,033 $ 2,138,357 =========== =========== Supplemental Disclosure of Cash Flow Information: Cash paid during the period for: Interest $ 4,320 $ 4,057 Income Taxes $ 2,898 $ 800
See accompanying notes to consolidated financial statements 3 5 SPATIALIZER AUDIO LABORATORIES, INC. AND SUBSIDIARIES Consolidated Statement of Shareholders' Equity (unaudited)
COMMON SHARES ------------------------------------------ TOTAL NUMBER OF ADDITIONAL ACCUMULATED SHAREHOLDERS' SHARES PAR VALUE PAID-IN-CAPITAL DEFICIT EQUITY ---------- --------- --------------- ------------ ------------- Balance, December 31, 1996 19,115,429 $191,154 $38,527,775 $(35,451,056) $3,267,873 Options Exercised 23,500 235 20,507 20,742 Private Placements, Net (Note 6) 1,667,500 16,675 1,949,468 1,966,143 Net Loss (1,026,839) (1,026,839) ---------- -------- ----------- ------------ ---------- Balance, March 31, 1997 20,806,429 $208,064 $40,497,750 $(36,477,895) $4,227,919 ========== ======== =========== ============ ==========
See accompanying notes to consolidated financial statements 4 6 SPATIALIZER AUDIO LABORATORIES, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (1) NATURE OF BUSINESS Spatializer Audio Laboratories, Inc. and subsidiaries (the "Company") is in the business of technology development and licensing. The Company's wholly owned subsidiary Desper Products, Inc. ("DPI") is in the business of developing proprietary advanced audio signal processing technologies and products for consumer electronics, entertainment, and multimedia computing. The Company's wholly owned subsidiary, MultiDisc Technologies, Inc. ("MDT") is in the business of developing scaleable, modular compact disc/DVD server technologies for licensing. Currently the development focus is on technologies associated with a network based compact disc/DVD server for internet and intranet applications. (2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation These consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States. Basis of Consolidation The consolidated financial statements include the accounts of Spatializer Audio Laboratories, Inc. and its wholly owned subsidiaries, Desper Products, Inc. and MultiDisc Technologies, Inc. All material inter-company transactions have been eliminated. Research and Development Expenditures The Company expenses research and development expenditures as incurred. (3) FIXED ASSETS Fixed assets, at cost, as of March 31, 1997 and December 31, 1996 consist of the following:
March 31, December 31, 1997 1996 ---------- ---------- Office Computers, Software, Equipment and Furniture $ 737,244 $ 595,993 Test Equipment 97,928 97,928 Tooling Equipment 44,136 44,136 Trade Show Booth and Demonstration Equipment 131,568 130,846 Leasehold Improvements 48,782 45,756 ---------- ---------- 1,059,659 914,659 Less Accumulated Depreciation and Amortization 348,660 291,803 ---------- ========== $ 710,999 $ 622,856 ========== ==========
5 7 (4) INTANGIBLE ASSETS Intangible assets, as of March 31, 1997 and December 31, 1996 consist of the following:
March 31, December 31, 1997 1996 --------- ------------ Capitalized patent and technology costs 362,947 309,222 Capitalized patent costs in association with MDT Asset Acquisition 200,000 200,000 ------- ------- 562,947 509,222 Less Accumulated Amortization 65,777 57,489 ------- ------- 497,170 451,733 ======= =======
(5) ADVANCES FROM RELATED PARTIES The Company was indebted to certain related parties for amounts totaling $112,500 at March 31, 1997 and December 31, 1996, respectively. Amounts bear interest at a fixed 10% annually and are due on demand. (6) SHAREHOLDERS' EQUITY During the three-month period ended March 31, 1997, shares of common stock were issued as follows: During the 1st quarter 1997, the Company completed a private placement of 1,600,000 units at a price of $1.25 US per unit comprised of one common share of the Company's stock and one-half of one, one-year non-transferable common stock purchase warrant. One warrant entitles the holder to purchase one additional share of common stock in the capital of the Company on or before April 7, 1998 at the price of $1.75 US per share. The Company received proceeds of $1,966,143 from the private placement of the Company's common stock during 1997, net of finders fees of $33,857 in cash and 67,500 shares of common stock valued at $1.75 US per share. 6 8 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis relates to the financial condition and results of operations of Spatializer Audio Laboratories, Inc. and subsidiaries (the "Company") for the three-month period ended March 31, 1997, compared with the three-month period ended March 31, 1996. RESULTS OF OPERATIONS FOR THE THREE-MONTH PERIOD ENDED MARCH 31, 1997, COMPARED TO THE THREE-MONTH PERIOD ENDED MARCH 31, 1996 REVENUES The Company reported an increase in revenues of 21% or $89,000, for a total of $518,000 from the three-month period ended March 31, 1997, compared to $429,000 for the three-month period ended March 31, 1996. Revenues include sales of professional recording systems, consumer products, license issuance fees and royalties pertaining to the Spatializer(R) analog integrated circuit ("IC"). The increase in revenues is attributed to increases in both recurring royalties and product sales for the period ended March 31, 1997 from the same period in 1996. The Company increased product sales through sales of its first consumer product, the HTMS-2510(TM) which inventory is expected to be depleted over the next couple of quarters. Due to unsatisfactory sales performance, the Company plans to move away from such hardware products and to concentrate on the higher-margin software products such as PT-3D(TM). The Company expects the majority of revenues to continue to come from licensing activities. During the first quarter, the Company began full-scale promotion at the Winter Consumer Electronic Show ("CES") of its premier Dolby(R) certified N-2-2(TM) virtualization technologies for multi-channel DVD, HDTV and Home Theater applications. In addition, it launched enCompass(TM), a real-time, interactive positional audio technology for both headphone and speaker playback in multimedia gaming applications in the Windows(TM) DirectSound(TM) environment. Both technologies serve to significantly broaden the company's advanced audio technology base and are the direct result of the Company's investment in Research & Development. Revenues from these new technologies are expected as early as the second quarter 1997. Gross profit for the three-month period ended March 31, 1997, was approximately 88% as compared with 93% for same period in 1996. Profit margins decreased slightly due to the increase in product sales. OPERATING EXPENSES The operating expenses for the three-month period ended March 31, 1997, increased approximately 25% or $293,000, for a total of $1,483,000 compared to $1,190,000 for the same period in 1996. This increase is attributed primarily to the added costs of operations related to the Company's new MultiDisc Technologies, Inc. ("MDT") subsidiary, which was established in June 1996, offset by decreases in sales and marketing activities. GENERAL AND ADMINISTRATIVE General and administrative costs increased 5% or $26,000, to $573,000 for the three-month period ended March 31, 1997 as compared with $547,000 for the same period in 1996. The change is primarily the result of increased payroll and payroll related costs as the Company transitioned consulting and temporary help to permanent positions as well as additional headcount related to supporting the efforts of the MDT subsidiary offset by decreased spending in investor relations and consulting and temporary help. 7 9 Payroll and Payroll Related Payroll and payroll related costs increased approximately 81%, or $152,000, to $339,000 for the three-month period ended March 31, 1997 as compared with $187,000 for the same period in 1996. The increase is attributed to the increase in staff from seven full-time staff in 1996 to eleven full-time staff and one part-time staff in 1997. The increase in staff count is related primarily to additional workloads due to regulatory reporting requirements, the support of pursuing new product launches, and the support requirements of the Company's subsidiary, MDT which was established in June 1996. The increase is also reflective of a transition from temporary staff and consultants to permanent employees. Consulting Fees and Temporary Help Consulting fees and temporary help decreased by approximately 100%, or $86,000, for a total of $0 for the three-month period ended March 31, 1997, compared to $86,000 for the same year in 1996. The reduction in costs relates to the completion of multiple consulting projects in 1996 including the analysis of technologies for potential acquisition and the permanent hire or elimination of temporary staff in the 1996 period. Professional Services Fees Professional services include legal fees and accounting fees. The fees for professional services decreased approximately 4%, or $1,000, for a total of $67,000 for the three-month period ended March 31, 1997, compared to $68,000 for the same period in 1996. Investor Relations Investor relations related costs decreased by approximately 56%, or $41,000, for a total of $32,000 in the three-month period ended March 31, 1997 compared with $73,000 in the same period in 1996. This decrease can be attributed to substantial efforts made in 1996 with the filing of the Company's first Form 10-K to accommodate increased interest in the Company as well as efforts in 1997 to control costs. General Operating General operating costs remained relatively flat with a minor increase of approximately 1%, or $2,000, for a total of $135,000 in the three-month period ended March 31, 1997 to $133,000 in the same period in 1996. These costs include rent, telephone, office supplies and stationery, postage, depreciation and similar costs. The consistency between periods is the direct result of internal cost controls and cost savings measures taken by the Company despite the increase in permanent full-time staff. RESEARCH AND DEVELOPMENT The research and development activity grew approximately 150% or $342,000, to $569,000 for the three-month period ended March 31, 1997, compared to $227,000 for the same period in 1996, with the added operations of the Company's new subsidiary, MDT commencing in June 1996. In addition, the Company continued efforts to identify, validate, and develop new product ideas through DPI. Technology introductions over the past twelve months include Spatializer 3-D Map(TM), enCompass(TM) (positional audio enhancement software for Windows(R) 95), and N22(TM) (Digital Virtual Surround technologies for multi-channel discrete audio systems in DVD/DVD-ROM and Home Theater products). All research and development activities and related costs continue to be expensed in the period incurred. The Company's new subsidiary, MDT, which began operations on June 24, 1996, represented approximately 64% or $365,000 of the department's total costs for the three-month period ended March 31, 1997. 8 10 Payroll and Payroll Related Payroll and payroll related costs for the Research and Development Department increased approximately 198% or $253,000, to $381,000 for the three-month period ended March 31, 1997 as compared with $128,000 for the same period in 1996. The increase is attributed to the increase in staff from eight in 1996 to sixteen in 1997. The increase in staff includes eight staff members involved in the MDT research and development efforts as well as additional staff costs of the Company's DPI subsidiary, which has also transitioned to full-time employees rather than outside contractors. Technology and Product - Engineering and Development Research & engineering costs, other than payroll and payroll related, increased approximately 89%, or $88,000, to $187,000 for the three-month period ended March 31, 1997 compared to $99,000 for the same period in 1996. The increase is primarily related to operations of the Company's new subsidiary, MDT, as it proceeds towards the development of its network based compact disc/DVD server technologies. SALES AND MARKETING Sales and marketing costs decreased approximately 18%, or $74,000, for a total of $341,000 for the three-month period ended March 31, 1997, compared to $415,000 for the same period in 1996. The decrease is attributed to a reduction in 1996 payroll and payroll related costs and advertising costs associated with the launch of the Company's consumer product, the HTMS-2510. Payroll and Payroll Related Payroll and payroll related costs for the Sales and Marketing Department decreased approximately 18% or $28,000, to $124,000 for the three-month period ended March 31, 1997 as compared with $152,000 for the same period in 1996. The decrease is attributed to the reduction in staff from seven in 1996 to six in 1997. Advertising and Trade Show Related Advertising which includes publicity, public relations, and press release costs and trade show related costs decreased approximately 29%, or $48,000, for a total of $117,000 for the three-month period ended March 31, 1997, compared to $165,000 for the same period in 1996. The decrease is associated with the reduction is trade show presence in 1997 compared to 1996 and the elimination of a promotional campaign launched in the 1996 period to promote the Company's consumer product, the HTMS-2510. Other Sales and Marketing Other costs including travel and entertainment, brochure and promotional literature, outside services and general operating costs had a minor increase of approximately 2% or $2,000, for a total of $100,000 for the three-month period ended March 31, 1997, compared to $98,000 for the same period in 1996. NET LOSS In an effort to reduce 1997 operating costs from 1996 levels, the Company implemented cost cutting measures in the forth quarter of 1996. The net loss for the three-month period ended March 31, 1997, totaled $1,027,000, compared to a net loss of $754,000 in the same three-month period in 1996. The increased net loss is primarily a result of the costs of operations at the Company's subsidiary, MDT, established in June 1996 partially offset by cost reductions. 9 11 LIQUIDITY AND CAPITAL RESOURCES At March 31, 1997, the Company had $2,389,000 in cash and cash equivalents as compared to $1,587,000 at December 31, 1996. The increase in cash and cash equivalents is attributed to cash received from operations and common stock issuances, including private placements and option exercises offset by cash used for operating activities and the purchase of fixed assets. The Company had working capital of $2,917,000 at March 31, 1997 as compared with $2,092,000 at December 31, 1996. The Company's future cash flow from operations will come primarily from Foundry and Original Equipment Manufacturers ("OEM") royalties. At March 31, 1997 the Company had four Foundry licensees and fifty-one OEM Licensees as compared with three Foundry licensees and forty-eight OEM Licensees at December 31, 1996. The Company continues to have no long-term debt and has no present commitments or agreements which would require any long-term debt to be incurred. The Company owed $112,500 to related parties as of March 31, 1997 and at December 31, 1996. During the first quarter 1997, the Company raised $1,966,143, net if issuance costs, through a private placement of 1,600,000 units in the Company consisting of a share of common stock and one-half of one non-transferable share purchase warrant. The proceeds of the financing are currently expected to be utilized to finance the Company's research and development activities in its MultiDisc Technologies ("MDT") business unit and for working capital reserves. However, such proceeds may be used at the Company's discretion to fund working capital needs or other obligations as they come due. In addition, the Company has the ability to curtail certain activities including, but not limited to, MDT related research and development, if necessary in order to meet its commitments. Funds generated by these financing activities as well as cash generated from operations is expected to be sufficient for the Company to meet its obligations during the next twelve months. However, additional sources of financing including debt, equity or strategic investments may be required to fund capital expenditures, acquisitions, research and development and marketing costs related to such activities. 10 12 PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS Reference is made to the Company's Form 10-K for the year ended December 31, 1996 with respect to the Company's litigation with QSound Labs, Inc. No material developments in such litigation occurred during the three months ended March 31, 1997. ITEM 2. CHANGES IN SECURITIES None ITEM 3. DEFAULTS UPON SENIOR SECURITIES None ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS There were no matters submitted to a vote of the security holders of the Company either through solicitation of proxies or otherwise in the first quarter of the fiscal year ending March 31, 1997. ITEM 5. OTHER INFORMATION None ITEM 6. EXHIBITS AND REPORTS ON FORM 8K 11.1 Computation of Loss Per Common Share 21.1 Schedule of Subsidiaries of the Company 11 13 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, thereunto duly authorized. Dated: May 13, 1997 SPATIALIZER AUDIO LABORATORIES, INC. (REGISTRANT) /s/ STEVEN D. GERSHICK ---------------------------------------- STEVEN D. GERSHICK President & Chief Executive Officer /s/ KATHY PARTCH ---------------------------------------- KATHY PARTCH Acting Chief Financial Officer 12 EX-11.1 2 COMPUTATION OF LOSS PER COMMON SHARE 1 SPATIALIZER AUDIO LABORATORIES, INC. EXHIBIT 11.1 COMPUTATION OF LOSS PER COMMON SHARE
THREE MONTHS FOUR MONTHS FISCAL YEAR ENDED FISCAL YEAR ENDED ENDED ENDED ----------- ---------------------------- ------------- ------------- MARCH 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, AUGUST 31, 1997 1996 1995 1994 1994 ----------- ------------ ------------ ------------- ------------- PRIMARY EARNINGS PER COMMON SHARE: Weighted Average Common Shares 13,120,862 12,644,751 15,933,516 14,329,235 12,376,579 Weighted Average Escrowed Performance Shares (1) (5,776,700) (5,776,700) (5,485,033) ---------- ---------- ---------- ---------- ---------- Adjusted Weighted Average Common Shares 13,120,862 12,644,751 10,156,816 8,552,535 6,891,546 ========== ========== ========== ========== ========== Net Loss for Period (1,026,839) (25,395,170) (3,241,285) (1,193,261) (1,808,387) ========== ========== ========== ========== ========== Primary Loss Per Share (0.08) (2.01) (0.32) (0.14) (0.26) ========== ========== ========== ========== ========== FULLY DILUTED EARNINGS PER COMMON SHARE: Adjusted Weighted Average Common Shares 13,120,862 12,644,751 10,156,816 8,552,535 6,891,546 Weighted Average Escrowed Performance Shares (1) 0 0 5,776,700 5,776,700 5,485,033 Shares to be issued on Option Exercise (2) 1,273,291 829,856 806,066 621,486 648,838 Shares to be issued on Option Exercise (2) 305,144 15,076 312,704 23,143 0 ---------- ---------- ---------- ---------- ---------- Fully Diluted Weighted Average Common Shares 14,699,297 13,489,683 17,052,286 14,973,864 13,025,417 ========== ========== ========== ========== ========== Net Loss for Period (from above) (1,026,839) (25,395,170) (3,241,285) (1,193,261) (1,808,387) ========== ========== ========== ========== ========== Fully Diluted Loss Per Share (0.07) (1.88) (0.19) (0.08) (0.14) ========== ========== ========== ========== ==========
(1) Escrowed performance shares were excluded from the determination of primary loss per share until conditions for release were met on December 31, 1996 at which time they were released. (2) Outstanding options and warrants to purchase common shares have not been included in the calculation of primary loss per share as the effect of including such securities would be antidilutive. For purposes of computing the fully diluted loss per share, the treasury stock method has been used and the shares have been treated as outstanding for the entire period. EX-21.1 3 SCHEDULE OF SUBSIDIARIES OF THE COMPANY 1 SPATIALIZER AUDIO LABORATORIES, INC. EXHIBIT 21.1 SCHEDULE OF SUBSIDIARIES OF THE COMPANY Desper Products, Inc. - California, USA Multidisc Technologies, Inc. - Delaware, USA EX-27 4 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE MARCH 31, 1997 FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS 3-MOS DEC-31-1997 JAN-01-1997 MAR-31-1997 2,389,033 0 811,020 0 239,854 3,613,349 1,059,659 348,660 4,924,171 696,252 0 0 0 208,064 0 4,924,171 518,462 518,462 64,255 1,483,285 0 0 4,320 (1,023,939) (2,898) (1,026,839) 0 0 0 (1,026,839) (.08) (.08)
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