Amedia Out on Its Ear
In the filing, dated September 7, the company noted it had been served with an eviction order following a legal dispute with its landlord over non-payment of rent, and had to vacate its offices by the end of Wednesday, September 12. It also noted that it might not be able to raise enough money to find alternative premises.
It also reported that it laid off seven of its nine staff on August 15, leaving only CEO Frank Galuppo and CFO J.D. Gardner on staff, though the seven continued to support the company until September 2 "based on the Company's statement that it would reinstate them if and when a financing is secured."
The company's financial statements show that at June 30 it had just $128,818 in cash and debts of more than $14 million. It generated revenues of $234,400 in the first half of this year and reported a net loss of $6.3 million.
Amedia also noted it has been "forced to delay payments to most of its vendors, defer salaries for management and curtail product development plans. If the Company is unable to raise additional capital on an immediate basis, it will be forced to lay-off its remaining workforce and either restructure or cease operations entirely. At the present time, the Company has no commitments for any additional financing, and there can be no assurance that, if needed, additional capital will be available to it on commercially acceptable terms (or at all)."
Things had looked brighter for Amedia a year ago. In April 2006 the vendor struck a product development "strategic alliance" with Motorola Inc. (NYSE: MOT), which unveiled the jointly developed home gateway, called the MIPX, at the Telco TV 2006 show in Dallas last November. (See Amedia Touts Gateway.)
And at that show CEO Galuppo talked up Amedia's product development plans for 2007. (See Amedia Tricks Out Gateways.)
The company also had relationships with the likes of Adtran Inc. (Nasdaq: ADTN), Calix Inc. (NYSE: CALX), and Zhone Technologies Inc. (Nasdaq: ZHNE), as this newsletter from July 2006 shows.
But in June this year Motorola took charge of "all engineering, manufacturing, and support duties" associated with the three IP home gateways the two firms had developed. Motorola agreed to pay Amedia $5 for each product made and advanced its partner $200,000 for the first 40,000 units to be made. (See Moto Licenses Amedia.)
Neither Galuppo nor Gardner could be reached for comment. The company listed on Amedia's Website (still up and running) as handling its investor relations, Alliance Advisors LLC, says it hasn't worked with the home gateway firm for four or five months.
In the past 12 months Amedia's share price has fallen 77 percent. It trades at $0.01 today and has a market cap of $4.61 million.
— Ray Le Maistre, International News Editor, Light Reading