MARINA DEL REY, Calif., Oct. 2 (Reuter) - Quarterdeck Corp Thursday said it expects to report an operating loss of several million dollars and a charge of $14 million in the fourth quarter ended September 30.
In a statement, the software maker also announced a convertible preferred stock financing to strengthen the company's balance sheet and to repurchase all the outstanding Series B convertible preferred stock.
The company said the charges are primarily non-cash, associated with recent restructuring activities.
The operating loss largely reflects higher return reserves in the U.S. market for end-of-life products in advance of new product launches that began over the past week with CleanSweep Deluxe, Zip-It 4.0 and TuneUp/TuneUp.com, and will continue through fiscal 1998.
The financing involved the private placement of approximately $26 million in zero-dividend Series C convertible preferred stock to a number of investor groups. Simultaneously, for $10 million, the company repurchased, at par, all of the outstanding shares of the Series B convertible preferred stock previously issued under Regulation S of the Securities Act of 1933, and canceled 800,000 of the approximately 1.7 million warrants associated with that issue.
The transactions provide net cash proceeds for the company of approximately $14.5 million, resulting in an expected cash balance for the quarter ended September 30, 1997 of about $23 million. The weighted average number of shares of the company's common stock outstanding for the quarter ended September 30, 1997 was approximately 43 million.
The charges include a write-down of the former DataStorm building in Missouri, which the company has listed for sale, a write-off of miscellaneous operating assets rendered non- performing by restructuring and severance and other obligations associated with recent downsizing decisions and divestiture activities.
The company said it continues to examine several divestment opportunities and does not currently expect these divestments will adversely affect net income. |
