Fullplay Media Announces Results for the First Quarter of 2002 and a Court Award of $429,000 in Litigation Defense Costs
BELLEVUE, Wash.–(BUSINESS WIRE)–May 16, 2002
Fullplay Media Systems, Inc. (OTC:FPLY) today announced results for the quarter ended March 31, 2002.
The company reported total revenues of $142,190 for the quarter ended March 31, 2002 as compared with total revenues of $622,375 for the quarter ended March 31, 2001.
Total operating costs for the first quarter of 2002 were $1,230,598 compared to $909,213 in the first quarter of 2001, an increase of 35%. The increase in operating costs for the comparable quarters is the result of expenses incurred in successfully defending a lawsuit against the Company (John Guarino and Ryan Smith vs. Interactive Objects, Inc.). Were it not for these legal costs, operating expenses would have been similar the prior year quarter. On May 13, 2002 the King County Superior Court awarded the Company $429,000 in fees and costs plus 12% interest from the award date to be paid by the plaintiffs. The plaintiffs have appealed the case.
Net loss for the first quarter of 2002 was $1,086,049, or $0.07 per share compared to $282,686 or $0.02 per share in the year earlier quarter.
“Thus far 2002 has been challenging but the Company has persevered and made great strides in executing its business plan,” said Dennis Tevlin, CEO of Fullplay. “After sustaining a fall off in our engineering services business in the aftermath of September 11th, we were successful in securing the largest contract in the history of the Company, a contract to deliver Trans World Entertainment Corporation (Nasdaq:TWMC), the nation’s largest mall-based specialty music retailer, 16,000 Listening and Viewing Stations (LVS) for deployment throughout their FYE stores in the United States. The remainder of the year should set a new standard for the company in terms of revenues.”
In addition, the Company is in the process of securing financing from a number of private investors. Closings on this round of financing are in progress and the Company expects this will continue for a short period of time. The Company is also in the process of retaining an investment bank to provide additional capital to fund future growth.
Finally, the Company successfully defended against the claim brought by John Guarino and Ryan Smith. “Although we believed their claim lacked merit, the trial required a great deal of resources and management effort,” said Richard Barber, CFO of Fullplay. “The plaintiffs have appealed the case, but based on the advice of counsel and the nature of the Court’s rulings, we don’t believe there is a significant risk the case will be overturned. Our feelings were bolstered by the May 13 decision by the court to award us $429,000 in fees and costs incurred in defending the case.”
A detailed account of Fullplay Media Systems’ financial results for the first quarter of 2002 has been filed with the Securities and Exchange Commission on Form 10-QSB.
About Fullplay Media Systems, Inc.
Fullplay is a leading designer of embedded software and hardware solutions for the converging Internet, digital media, entertainment and consumer electronics markets. Fullplay partners with many of the top brands in consumer electronics and entertainment, and holds a focused technology portfolio that includes the Dharma(TM) Digital Media Development Platform; the Fullplay(TM) Media OS and Media Manager; the Darwin(TM) Digital Audio Jukebox; and the Fullplay(TM) Home Media Center. Fullplay is headquartered at 12600 SE 38th, Suite 150, Bellevue, WA 98006, USA. Fullplay is listed on the OTC.BB under the symbol “FPLY” and can be reached on the web at www.fullplaymedia.com.
Certain information included in this communication contains statements that are forward-looking, such as statements relating to the future anticipated direction of the high technology industry, plans for future expansion, various business development activities, planned capital expenditures, funding sources or the ability to raise capital, anticipated sales growth, litigation and potential contracts. These forward statements are subject to a number of known and unknown risks and uncertainties that could cause actual operations or results to differ materially from those anticipated. These risks include, among others, risks associated with unproven sales of the Company’s products, risks associated with the software development, risks associated with the litigation process, risks associated with liquidity and the risk that funding will not be available with terms acceptable to the Company or at all or that financing efforts currently in process will close. Certain of these risks and other risks are described in the Company’s Form 10-KSB filed with the Securities and Exchange Commission (SEC) and available from the SEC’s Web site at http://www.sec.gov/. Securities that potential investors may acquire from the Company, if any, will not be registered under the Securities Act of 1933, and the investors will not be able to offer or resell the securities in the United States absent registration or an applicable exemption from registration requirements.
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