| SEC Info | Home | Search | My Interests | Help | Sign In | Please Sign In | ||||||||||||||||||||
As Of Filer Filing As/For/On Docs:Pgs Issuer Agent 5/15/07 Fonix Corp 10-Q 3/31/07 5:71 Southridge Svcs LLC/FA
Document/Exhibit Description Pages Size
1: 10-Q Fonix Corporation Form 10-Q March 31, 2007 HTML 292K
2: EX-31.1 Exhibit 31.1 - Certification of President HTML 12K
3: EX-31.2 Exhibit 31.2 - Certification of Chief Financial HTML 12K
Officer
4: EX-32.1 Exhibit 32.1 - Certification of President Pursuant HTML 8K
to Section 906 of the Sarbanes-Oxley Act
of 2002
5: EX-32.2 Exhibit 32.2 - Certification of Chief Financial HTML 8K
Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
|
[X]
|
Quarterly
Report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of
1934 for the quarterly period ended March 31, 2007,
or
|
|
[
]
|
Transition
Report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of
1934 for the transition period from ______________ to
_____________.
|
|
22-2994719
|
|
|
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification No.)
|
|
Page
|
||
|
Item
1.
|
Financial
Statements (Unaudited)
|
|
|
3
|
||
|
Condensed
Consolidated Statements of Operations and Comprehensive Loss for
the Three
Months Ended March 31, 2007 and 2006
|
4
|
|
|
5
|
||
|
Notes
to Condensed Consolidated Financial Statements (Unaudited)
|
7
|
|
|
Item
2.
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
17
|
|
Item
3.
|
Quantitative
and Qualitative Disclosures About Market Risk
|
28
|
|
Item
4.
|
Controls
and Procedures
|
28
|
|
PART
II - OTHER INFORMATION
|
||
|
Item
1.
|
Legal
Proceedings
|
28
|
|
Item
1A.
|
Risk
Factors
|
29
|
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
30
|
|
Item
6.
|
Exhibits
|
30
|
|
March
31,
|
|||||||
|
|
2006
|
||||||
|
ASSETS
|
|||||||
|
Current
assets
|
|||||||
|
Cash
and cash equivalents
|
$
|
397,000
|
$
|
5,000
|
|||
|
Accounts
receivable, net of an allowance for doubtful accounts of $0 and
$137,000,
respectively
|
-
|
-
|
|||||
|
Prepaid
expenses and other current assets
|
7,000
|
4,000
|
|||||
|
Total
current assets
|
404,000
|
9,000
|
|||||
|
Property
and equipment,
net of accumulated depreciation of $1,275,000 and $1,261,000,
respectively
|
34,000
|
48,000
|
|||||
|
Deposits
and other assets
|
117,000
|
117,000
|
|||||
|
Goodwill
|
2,631,000
|
2,631,000
|
|||||
|
Total
assets
|
$
|
3,186,000
|
$
|
2,805,000
|
|||
|
LIABILITIES
AND STOCKHOLDERS' DEFICIT
|
|||||||
|
Current
liabilities
|
|||||||
|
Accrued
liabilities
|
$
|
2,677,000
|
$
|
2,054,000
|
|||
|
Accounts
payable
|
1,048,000
|
1,504,000
|
|||||
|
Net
liabilities of discontinued subsidiaries
|
20,819,000
|
20,819,000
|
|||||
|
Derivative
liability
|
19,591,000
|
20,941,000
|
|||||
|
Accrued
payroll and other compensation
|
214,000
|
214,000
|
|||||
|
Accrued
settlement obligation, net of unamortized discount of $0 and $118,000,
respectively
|
1,530,000
|
1,530,000
|
|||||
|
Deferred
revenues
|
447,000
|
460,000
|
|||||
|
Notes
payable - related parties
|
902,000
|
800,000
|
|||||
|
Series
E debentures
|
1,754,000
|
1,754,000
|
|||||
|
Advance
on Series B Preferred Stock
|
1,250,000
|
-
|
|||||
|
Current
portion of notes payable
|
3,652,000
|
2,883,000
|
|||||
|
Deposits
and other
|
7,000
|
7,000
|
|||||
|
Total
current liabilities
|
53,891,000
|
52,966,000
|
|||||
|
Long-term
notes payable, net of current portion
|
2,908,000
|
2,988,000
|
|||||
|
Total
liabilities
|
56,799,000
|
55,954,000
|
|||||
|
Commitments
and contingencies
|
|||||||
|
Stockholders'
deficit
|
|||||||
|
Preferred
stock, $0.0001 par value; 50,000,000 shares authorized;
|
|||||||
|
Series
A, convertible; 166,667 shares outstanding (aggregate liquidation
preference of $6,055,000)
|
500,000
|
500,000
|
|||||
|
Series
L, convertible; 1,794 shares and 1,858 shares outstanding ,
respectively
|
-
|
-
|
|||||
|
Common
stock, $0.0001 par value; 5,000,000,000 shares authorized;
|
|||||||
|
Class
A voting, 1,707,139,820 shares and 1,309,965,981 shares outstanding,
respectively
|
170,000
|
131,000
|
|||||
|
Class
B non-voting, none outstanding
|
-
|
-
|
|||||
|
Additional
paid-in capital
|
237,630,000
|
236,936,000
|
|||||
|
Outstanding
warrants to purchase Class A common stock
|
474,000
|
474,000
|
|||||
|
Cumulative
foreign currency translation adjustment
|
10,000
|
10,000
|
|||||
|
Accumulated
deficit
|
(292,397,000
|
)
|
(291,200,000
|
)
|
|||
|
Total
stockholders' deficit
|
(53,613,000
|
)
|
(53,149,000
|
)
|
|||
|
Total
liabilities and stockholders' deficit
|
$
|
3,186,000
|
$
|
2,805,000
|
|||
|
Three
Months Ended March 31,
|
2006
|
||||||
|
Revenues
|
$
|
360,000
|
$
|
272,000
|
|||
|
Cost
of revenues
|
7,000
|
5,000
|
|||||
|
Gross
profit
|
353,000
|
267,000
|
|||||
|
Expenses:
|
|||||||
|
Selling,
general and administrative
|
807,000
|
1,173,000
|
|||||
|
Product
development and research
|
487,000
|
571,000
|
|||||
|
Total
expenses
|
1,294,000
|
1,744,000
|
|||||
|
Other
income (expense):
|
|||||||
|
Interest
expense
|
(463,000
|
)
|
(374,000
|
)
|
|||
|
Gain
on derivative liability
|
617,000
|
-
|
|||||
|
Other
income (expense), net
|
154,000
|
(374,000
|
)
|
||||
|
Net
loss from continuing operations
|
(787,000
|
)
|
(1,851,000
|
)
|
|||
|
Net
loss from discontinued operations
|
-
|
(2,230,000
|
)
|
||||
|
Net
loss
|
(787,000
|
)
|
(4,081,000
|
)
|
|||
|
Preferred
stock dividends
|
(410,000
|
)
|
(1,849,000
|
)
|
|||
|
Loss
attributable to common stockholders
|
$
|
(1,197,000
|
)
|
$
|
(5,930,000
|
)
|
|
|
Basic
and diluted loss per common share from continuing
operations
|
$
|
(0.00
|
)
|
$
|
(0.01
|
)
|
|
|
Basic
and diluted loss per common share from discontinued
operations
|
$
|
(0.00
|
)
|
$
|
(0.01
|
)
|
|
|
Net
loss
|
$
|
(787,000
|
)
|
$
|
(4,081,000
|
)
|
|
|
Other
comprehensive (loss) income - foreign currency translation
|
-
|
7,000
|
|||||
|
Comprehensive
loss
|
$
|
(787,000
|
)
|
$
|
(4,074,000
|
)
|
|
|
Three
Months Ended March 31,
|
2006
|
||||||
|
Cash
flows from operating activities
|
|||||||
|
Net
loss
|
$
|
(787,000
|
)
|
$
|
(4,081,000
|
)
|
|
|
Adjustments
to reconcile net loss to net cash used in operating
activities:
|
|||||||
|
Discontinued
operations
|
-
|
2,230,000
|
|||||
|
Gain
on derivative liability
|
(617,000
|
)
|
-
|
||||
|
Accretion
of discount on notes payable
|
239,000
|
187,000
|
|||||
|
Accretion
of discount on legal settlement
|
-
|
46,000
|
|||||
|
Depreciation
|
14,000
|
14,000
|
|||||
|
Foreign
exchange loss (gain)
|
-
|
(7,000
|
)
|
||||
|
Changes
in assets and liabilities
|
|||||||
|
Prepaid
expenses and other current assets
|
(3,000
|
)
|
14,000
|
||||
|
Intercompany
account
|
-
|
238,000
|
|||||
|
Accounts
payable
|
(456,000
|
)
|
134,000
|
||||
|
Accrued
payroll and other compensation
|
-
|
77,000
|
|||||
|
Other
accrued liabilities
|
213,000
|
136,000
|
|||||
|
Deferred
revenues
|
(13,000
|
)
|
42,000
|
||||
|
Net
cash used in operating activities
|
(1,410,000
|
)
|
(970,000
|
)
|
|||
|
Cash
flows from investing activities
|
|||||||
|
Purchase
of property and equipment
|
-
|
(2,000
|
)
|
||||
|
Net
cash used in investing activities
|
-
|
(2,000
|
)
|
||||
|
Cash
flows from financing activities
|
|||||||
|
Proceeds
from issuance of Class A common stock, net
|
-
|
1,220,000
|
|||||
|
Proceeds
from related party note payable
|
102,000
|
-
|
|||||
|
Advance
on Series B Preferred Stock
|
1,250,000
|
-
|
|||||
|
Proceeds
from notes payable
|
450,000
|
200,000
|
|||||
|
Payments
on related party note payable
|
-
|
(50,000
|
)
|
||||
|
Payments
of accrued settlement obligation
|
-
|
(260,000
|
)
|
||||
|
Principal
payments on notes payable
|
-
|
(99,000
|
)
|
||||
|
Net
cash provided by financing activities
|
1,802,000
|
1,011,000
|
|||||
|
Net
increase in cash and cash equivalents
|
392,000
|
39,000
|
|||||
|
Cash
and cash equivalents at beginning of period
|
5,000
|
28,000
|
|||||
|
Cash
and cash equivalents at end of period
|
$
|
397,000
|
$
|
67,000
|
|||