<Page>
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2002
COMMISSION FILE NUMBER 0-25882
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EZENIA! INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 04-3114212
(STATE OR OTHER JURISDICTION OF (IRS EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
NORTHWEST PARK, 63 THIRD AVENUE, BURLINGTON, MASSACHUSETTS 01803
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES, INCLUDING ZIP CODE)
(781) 229-2000
(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 / /
The number of shares outstanding of the registrant's Common Stock as of May 3,
2002 was 13,631,880.
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EZENIA! INC.
INDEX
<Table>
<Caption>
Page
----
PART I. FINANCIAL INFORMATION
ITEM 1 Condensed Consolidated Financial Statements (unaudited)
Condensed Consolidated Balance Sheets
March 31, 2002 and December 31, 2001.......................... 3
Condensed Consolidated Statements of Operations
Three months ended March 31, 2002 and 2001.................... 4
Condensed Consolidated Statements of Cash Flows
Three months ended March 31, 2002 and 2001.................... 5
Notes to Condensed Consolidated Financial Statements............ 6
ITEM 2 Management's Discussion and Analysis of Financial Condition
and Results of Operations..................................... 10
ITEM 3 Quantitative and Qualitative Disclosures About Market Risk...... 13
PART II. OTHER INFORMATION
ITEM 6 Exhibits and Reports on Form 8-K................................ 14
SIGNATURE....................................................................15
</Table>
This report contains "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements are subject to
certain risks and uncertainties, including without limitation those discussed in
the Company's 2001 Annual Report on Form 10-K for the year ended December 31,
2001 in the section titled "Factors which may affect future operations." Such
forward-looking statements speak only as of the date on which they are made, and
the Company cautions readers not to place undue reliance on such statements.
Note: Ezenia! is a registered trademark of Ezenia! Inc., and the Ezenia! Logo
and InfoWorkSpace are trademarks of Ezenia! Inc.
2
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EZENIA! INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT FOR SHARE AND PER SHARE RELATED DATA)
(UNAUDITED)
<Table>
<Caption>
MARCH 31, DECEMBER 31,
2002 2001
----------------- ----------------
ASSETS
Current assets
Cash and cash equivalents $ 3,529 $ 5,531
Accounts receivable, less allowances of $914 2,580 2,313
Inventories 3,257 3,882
Prepaid software licenses 1,649 774
Prepaid expenses and other current assets 787 691
---------------- ----------------
Total current assets 11,802 13,191
Equipment and improvements, net of accumulated depreciation 3,002 3,470
Goodwill and other intangible assets, net 11,337 11,673
Other assets, net 11 24
---------------- ---------------
$ 26,152 $ 28,358
================ ===============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Note payable $ 2,000
Accounts payable $ 2,014 1,830
Accrued expenses 976 1,445
Income taxes 529 492
Accrued restructuring expenses 79 101
Deferred revenue 4,529 2,065
Current portion of common stock subject to put 1,100
---------------- ---------------
Total current liabilities 8,127 9,033
Common stock subject to put; 290,000 shares issued and outstanding
at March 31, 2002; 400,000 shares issued and outstanding at
December 31, 2001, less amount classified as current 2,875 2,875
Stockholders' equity
Preferred stock, $.01 par value; 2,000,000 shares authorized, none
issued and outstanding
Common stock, $.01 par value, 40,000,000 shares authorized,
13,631,880 issued and outstanding at March 31, 2002;
13,741,880 issued and outstanding at December 31, 2001 139 139
Capital in excess of par value 60,666 59,566
Accumulated deficit (42,103) (40,883)
Accumulated other comprehensive loss (691) (611)
Treasury stock at cost 660,000 shares at March 31, 2002 and 550,000
shares at December 31, 2001 (2,861) (1,761)
----------------- ----------------
15,150 16,450
----------------- ----------------
$ 26,152 $ 28,358
================= ================
</Table>
See accompanying notes.
3
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EZENIA! INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT FOR SHARE AND PER SHARE RELATED DATA)
(UNAUDITED)
<Table>
<Caption>
THREE MONTHS ENDED
MARCH 31,
2002 2001
---------------- ----------------
Revenues
Product revenue $ 2,164 $ 2,579
Service revenue 494 780
---------------- ----------------
2,658 3,359
---------------- ----------------
Cost of revenues
Cost of product revenue 1,143 1,414
Cost of service revenue 255 960
---------------- ----------------
1,398 2,374
---------------- ----------------
Gross profit 1,260 985
Operating expenses
Research and development 1,544 2,390
Sales and marketing 1,317 2,902
General and administrative 497 1,069
Depreciation and amortization 873 701
Occupancy and other facilities related expenses 902 687
---------------- ----------------
Total operating expenses 5,133 7,749
---------------- ----------------
Loss from operations (3,873) (6,764)
Other income (expense)
Interest income, net 2 455
Loss on investment (543)
---------------- ----------------
2 (88)
---------------- ----------------
Loss before income taxes (3,871) (6,852)
Income taxes (benefit) (2,651) 32
---------------- ----------------
Net loss $ (1,220) $ (6,884)
================ ================
Net loss per share:
Basic and diluted $ (0.09) $ (0.51)
Weighted average common shares:
Basic and diluted 13,661,543 13,378,807
</Table>
See accompanying notes.
4
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EZENIA! INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
<Table>
<Caption>
THREE MONTHS ENDED
MARCH 31,
2002 2001
---------------- ----------------
OPERATING ACTIVITIES
Net loss $ (1,220) $ (6,884)
Adjustments to reconcile net loss to net cash provided by (used for)
operating activities:
Depreciation and amortization 888 746
Loss on investment 543
Changes in operating assets and liabilities, less amounts attributable to
acquisition of InfoWorkSpace:
Accounts receivable (267) 1,138
Inventories 625 (919)
Prepaid software licenses (875) (646)
Other current assets (96) 69
Accounts payable and accrued expenses (307) 251
Income taxes 37
Deferred revenue 2,464 (17)
---------------- ----------------
Net cash provided by (used for) operating activities 1,249 (5,719)
INVESTING ACTIVITIES
Cash received from sale of network access card product line 1,500
Acquisition of InfoWorkSpace (3,100) (7,526)
Net purchases of equipment and improvements (69) (239)
Changes of marketable securities, net 6,450
Changes in other assets (2) 193
---------------- ----------------
Net cash provided by (used for) investing activities (3,171) 378
FINANCING ACTIVITIES
Net proceeds from issuance of stock under employee benefit plans 151
---------------- ----------------
Net cash provided by financing activities 151
Effect of exchange rate on cash and cash equivalents (80) (48)
---------------- ----------------
Decrease in cash and cash equivalents (2,002) (5,238)
Cash and cash equivalents at beginning of period 5,531 20,457
---------------- ----------------
Cash and cash equivalents at end of period $ 3,529 $ 15,219
================ ================
</Table>
See accompanying notes.
5
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EZENIA! INC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements include
the accounts of the Company and its wholly owned subsidiaries. In the opinion of
management, these financial statements contain all adjustments necessary for a
fair presentation of the results of these interim periods. In addition to normal
recurring adjustments, the financial statements for the period ended March 31,
2001 include a provision for loss on investment (see note 6). Certain footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted,
although the Company believes the disclosures in these financial statements are
adequate to make the information presented not misleading. These financial
statements should be read in conjunction with the Company's audited financial
statements included in the Company's 2001 Annual Report on Form 10-K for the
year ended December 31, 2001. The results of operations for the interim periods
shown are not necessarily indicative of the results for any future interim
period or for the entire fiscal year.
Certain amounts in 2001 have been reclassified to permit comparison with 2002
classifications.
2. GOING CONCERN
The Company has incurred substantial recurring operating losses and negative
cash flows, and at March 31, 2002, has limited cash resources. The Company's
ability to continue as a going concern is dependent upon its ability to raise
additional capital, increase revenue or substantially improve operating margins.
In May 2001, the Company implemented a restructuring and cost reduction plan to
reduce operating costs in line with anticipated revenues with the ultimate
objective of improving operating margins and becoming cash-flow neutral from
operations. As a result of these actions, the Company recorded charges of
approximately $2.0 million in the second quarter of 2001, of which all but
approximately $79 thousand had been paid by March 31, 2002. These charges
primarily represented severance costs related to the termination of 90
employees, constituting approximately 50% of the Company's workforce at the time
the cost reduction plan was implemented. The reduction in workforce covered all
functional areas, including research and development, sales and marketing,
general and administrative, manufacturing and technical support.
Operating costs were in line with the Company's expectations for the quarter
ended March 31, 2002. The Company's success in achieving its goal of being
cash-flow neutral is largely dependent on whether it can meet its future revenue
targets.
In addition, the restructuring and cost reduction plan calls for the Company to
close down its Burlington, Massachusetts facility and move its office
headquarters to a smaller, more cost efficient facility. Because of the
depressed real estate market in Massachusetts at the current time the Company
cannot estimate when such a move will be completed, if at all.
There can be no assurance that the Company can achieve the above-mentioned
actions. These conditions raise substantial doubt about the Company's ability to
continue as a going concern. The accompanying financial statements do not
include any adjustments to reflect the possible future effects on the
recoverability and classification of assets or the amounts and classification of
liabilities that may result from the outcome of this uncertainty.
6
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3. SIGNIFICANT ESTIMATES AND ASSUMPTIONS
The preparation of the financial statements in conformity with accounting
principles generally accepted in the United States requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, and disclosure of contingent assets and liabilities, if any, at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from these
estimates.
4. INVENTORIES
Inventories consist of:
<Table>
<Caption>
MARCH 31, DECEMBER 31,
(In thousands) 2002 2001
--------------- ---------------
Raw materials and subassemblies $ 1,487 $ 1,501
Software licenses 1,237 1,806
Work in process 372 458
Finished goods 161 117
--------------- ---------------
$ 3,257 $ 3,882
=============== ===============
</Table>
The Company has entered into a license agreement with a software vendor. Under
the terms of the agreement, the Company is obligated to purchase $3.5 million
and $4.0 million of software licenses over the twelve month periods ending March
26, 2002 and March 26, 2003, respectively. The licenses are resold with the
Company's InfoWorkSpace products. Based on the Company's current sales
forecasts, all licenses to be purchased under the agreement will be used through
sales of InfoWorkSpace products. At March 31, 2002, the Company had acquired
approximately $3.5 million of licenses under the agreement.
5. ACQUISITIONS
On March 27, 2001, the Company completed the acquisition of all of the
operating assets and intellectual property of the InfoWorkSpace business unit
of General Dynamics Electronic Systems for $17 million in cash and 400,000
shares of the Company's common stock valued, for purposes of the transaction,
at $10.00 per share. An advance of $6 million was paid in December 2000, $6
million was paid at closing, $3 million was paid on July 2, 2001 and the
final payment of $2 million was paid on January 4, 2002. The 400,000 shares
issued were accompanied by an option allowing the seller to put the shares to
the Company at $10.00 per share. The put option with respect to 110,000
shares was exercised by the seller on January 4, 2002, and the shares were
reacquired at an aggregate price of $1.1 million on January 25, 2002. The put
agreement, as amended, gives the seller the option to require the Company to
repurchase the balance of 290,000 shares beginning December 1, 2002 and
expiring December 31, 2002. The put right shall expire at such time as the
last reported closing price of the common stock has been equal to or greater
than $11.00 per share for fifteen (15) consecutive trading days. Common stock
subject to the put option is reported as temporary equity. For purposes of
computing diluted earnings per share, such shares are included in the
calculation using the reverse treasury stock method when dilutive.
Pursuant to the terms of the purchase agreement, the Company paid approximately
$1 million at the closing to cover the seller's transitional operating costs
(net of revenue earned during the period) for the period between the signing of
the purchase agreement and the closing of the transaction. The acquisition has
been accounted for as a purchase.
InfoWorkSpace products provide knowledge workers a secure virtual workspace for
project and team collaboration. InfoWorkSpace products are currently used
primarily by government organizations, including Defense Department agencies and
the Intelligence Community.
7
<Page>
Operating results of the InfoWorkSpace product line have been included in the
Company's financial statements from the acquisition date. The following table
presents unaudited pro forma consolidated operating results for the three months
ended March 31, 2001 as if the acquisition had occurred as of the beginning of
the period.
(In thousands)
<Table>
Revenue $ 3,694
Net loss (9,887)
Basic and diluted net loss per share $ (.74)
</Table>
The unaudited pro forma consolidated operating results are not necessarily
indicative of the operating results that would have been achieved had the
acquisition been consummated at the beginning of the period presented, and
should not be construed as representative of future operating results.
6. LOSS ON INVESTMENT
Loss on investment represents an adjustment recorded during the period ended
March 31, 2001, to reduce to zero the carrying value of the Company's minority
investment in a closely-held company.
7. COMPREHENSIVE LOSS
Total comprehensive loss consists of the following:
<Table>
<Caption>
THREE MONTHS ENDED
MARCH 31,
(In thousands) 2002 2001
----------- ------------
Net loss $ (1,220) $ (6,884)
Foreign currency translations (80) (48)
----------- ------------
Comprehensive loss $ (1,300) $ (6,932)
=========== ============
</Table>
8. GOODWILL
In July 2001, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standard (SFAS) No. 142, "Goodwill and Other
Intangibles." Under SFAS No. 142, goodwill is no longer subject to
amortization over its estimated useful life. But, goodwill is subject to at
least an annual assessment for impairment applying a fair-value based test.
Additionally, under the provisions of the new accounting standard, an
acquired intangible asset should be separately recognized if the benefit of
the intangible asset is obtained through contractual or other legal rights,
or if the intangible asset can be sold, transferred, licensed, rented, or
exchanged, regardless of the acquirer's intent to do so. The Company is
required to adopt this standard effective January 1, 2002 and, as permitted
by the standard, has until June 30, 2002 to complete the first step of the
initial goodwill impairment test and until December 31, 2002 to compute the
amount of impairment, if any. The Company has not yet determined what other
effect, if any, adoption of the impairment test provisions of SFAS No. 142
may have on its financial position or results of operations.
8
<Page>
9. NET INCOME (LOSS) PER SHARE
The Company reports earnings per share in accordance with the SFAS No. 128,
"Earnings per Share." Diluted earnings per share include the effect of dilutive
stock options and shares subject to a put option (see note 5) when dilutive.
Outstanding stock options at March 31, 2002 and 2001 were 3,269,337 and
3,462,780, respectively.
10. REVENUE RECOGNITION
Revenue from product sales is recognized upon shipment. The Company's products
are generally delivered without significant post-sale obligations to the
customer. If significant obligations exist, revenue recognition is deferred
until the obligations are satisfied. Estimated product warranty costs are
accrued at the time of sale. Revenue from sales of InfoWorkSpace software
licenses is recognized ratably over the subscription period, generally one year.
Revenue from maintenance agreements is recognized ratably over the terms of the
agreements, and other service revenue is recognized as the services are
performed.
11. SOFTWARE LICENSES
The Company's InfoWorkSpace products incorporate software licenses, which the
Company purchases from other software vendors. Software licenses purchased
from vendors are reported as inventory until the sale of the underlying
InfoWorkSpace subscription license at which time they are reported as prepaid
licenses and amortized over the subscription period.
12. INCOME TAXES
The Federal Job Creation and Worker Assistance Act of 2002, enacted in March
2002, allows the Company to carryback net operating losses incurred in 2001 for
a period of up to five years, rather than two years as had previously been the
case. The additional carryback period enabled the Company to file a carryback
claim in March 2002, resulting in the utilization of approximately $12.5 million
of net operating losses that would have expired in 2022 and the recovery of
approximately $2.7 million of income taxes paid in prior years.
9
<Page>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
RESULTS OF OPERATIONS
REVENUE Revenue decreased to $2.7 million for the quarter ended March 31,
2002 from $3.4 million reported for the quarter ended March 31, 2001. The
decrease in revenue was principally related to a significant decline in sales of
ISDN and IP products and related service revenues. ISDN revenue represented $.8
million and IP revenue represented $.7 million of the decrease. These decreases
were offset by $.8 million of revenue associated with the Company's
InfoWorkSpace product line acquired in March 2001.
Revenue from international markets accounted for approximately 30% and 51%
of revenue for the quarters ended March 31, 2002 and 2001, respectively.
GROSS PROFIT Cost of revenues includes material costs, costs of software
licenses, manufacturing labor and overhead and customer support costs. Gross
profit as a percentage of revenue was 47.4% for the quarter ended March 31, 2002
as compared to 29.3% for the quarter ended March 31, 2001. The increase in
margin is primarily attributable to the overall decrease in manufacturing and
service costs that were reduced as part of the restructuring and cost reduction
plan implemented in May 2001.
RESEARCH AND DEVELOPMENT Research and development expenses decreased to
$1.5 million for the quarter ended March 31, 2002 from $2.4 million for the
quarter ended March 31, 2001. The decrease is related to the Company's
restructuring and cost reduction plan implemented in May 2001. This decrease is
offset by increased costs of $.7 million related to the acquisition of
InfoWorkSpace.
SALES AND MARKETING Sales and marketing expenses decreased to $1.3 million
for the quarter ended March 31, 2002 from $2.9 million for the quarter ended
March 31, 2001. The decrease was primarily due to the Company's restructuring
and cost reduction plan implemented in May 2001. Cost savings achieved from the
restructuring and cost reduction plan were offset by added sales and marketing
expenses of approximately $.5 million attributable to the InfoWorkSpace product
line acquired in March 2001.
GENERAL AND ADMINISTRATIVE General and administrative expenses were
approximately $.5 million for the quarter ended March 31, 2002, a decrease from
$1.1 million for the quarter ended March 31, 2001. The decrease was primarily
due to cost savings associated with the Company's restructuring and cost
reduction plan implemented in May 2001.
OCCUPANCY AND OTHER FACILITIES RELATED EXPENSES Occupancy costs were
approximately $.9 million during the three month period ended March 31, 2002 as
compared to $.7 million for the corresponding period of the previous year. The
increase is related primarily to additional facilities costs associated with the
acquisition of InfoWorkSpace product line in March 2001. Occupancy and other
facilities related expenses represent rent expense and other operating costs
associated with the Company's headquarters and manufacturing facility in
Burlington, Massachusetts and various other sales and development offices in the
United States, United Kingdom, Hong Kong and China.
INTEREST INCOME, NET Interest income, net, consists of interest on cash,
cash equivalents and marketable securities. Interest income, net, decreased to
approximately $2 thousand in the quarter ended March 31, 2002, from
approximately $455 thousand in the quarter ended March 31, 2001. The decrease
was due principally to a decrease in the amount of cash available for
investment.
10
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INCOME TAXES The Federal Job Creation and Worker Assistance Act of 2002,
enacted in March 2002, allows the Company to carryback net operating losses
incurred in 2001 for a period of up to five years, rather than two years as had
previously been the case. The additional carryback period enabled the Company to
file a carryback claim in March 2002, resulting in the utilization of
approximately $12.5 million of net operating losses that would have expired in
2022 and the recovery of approximately $2.7 million of income taxes paid in
prior years.
OTHER FACTORS WHICH MAY AFFECT FUTURE OPERATIONS There are a number of
business factors which singularly or combined may affect the Company's future
operating results. Some of them, including liquidity, dependence on major
customers, reduced demand for traditional videoconferencing products, evolving
market, rapid technological change, competition, InfoWorkSpace acquisition,
protection of proprietary technology and retention of key employees have been
outlined in the Company's 2001 Annual Report on Form 10-K for the year ended
December 31, 2001.
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 2002, the Company had cash, cash equivalents and marketable
securities of approximately $3.5 million, which are regularly invested in
short-term money market funds, government securities and commercial paper.
Under the put option issued by the Company in connection with its acquisition of
the InfoWorkSpace business, the Company may be required to purchase another $2.9
million of its common stock in December 2002 (see Note 5 of Notes to Condensed
Consolidated Financial Statements). The Company had losses from operations of
$3.9 million and a net loss of $1.2 million (including a tax benefit of $2.7
million) for the quarter ended March 31, 2002.
The Company's ability to continue as a going concern is dependent upon its
ability to raise additional capital, increase revenue or substantially improve
operating margins. In May 2001, the Company implemented a restructuring and cost
reduction plan to reduce operating costs in line with anticipated revenues with
the ultimate objective of improving operating margins and becoming cash-flow
neutral from operations. As a result of these actions, the Company recorded
charges of approximately $2.0 million of which all but approximately $79
thousand had been paid by March 31, 2002. These charges reported in the second
quarter of 2001 primarily represented severance costs related to the termination
of 90 employees, constituting approximately 50% of the Company's workforce at
the time the cost reduction plan was implemented. The reduction in workforce
covered all functional areas, including research and development, sales and
marketing, general and administrative, manufacturing and technical support.
Operating costs at the end of March 2002 were in line with the Company's
expectations. The Company estimates its cash-flow breakeven point to be
approximately $24 million to $26 million in annual sales. The Company's total
revenue for the quarter ended March 31, 2002 was $2.7 million. If the Company is
not successful in meeting its revenue targets, it may not be able to generate
cash flows sufficient to continue operations.
The Company's common stock is presently listed on the Nasdaq National Market
under the symbol EZEN. All companies with securities listed on the Nasdaq
National Market are required to comply with certain continued listing
standards, including maintaining a minimum bid price of at least $1.00 per
share and having a public float with an aggregate value of at least $5
million. The Company has been unable to meet these listing criteria and,
accordingly, has applied to list its common stock on the Nasdaq SmallCap
Market, which has more easily achieved listing criteria. Companies listed on
the Nasdaq SmallCap Market are also required to comply with certain continued
listing standards, including maintaining a minimum bid price of at least
$1.00 per share. However, Nasdaq has provided the Company a grace period
through August 13, 2002 for compliance with the bid price
11
<Page>
requirement. The Company could be eligible for an additional 180-day
extension of the grace period if it otherwise meets the initial listing
criteria applicable to the Nasdaq SmallCap Market, including having a public
float with an aggregate value of at least $5 million. If the Company is
unable to satisfy the $1.00 minimum bid price requirement within the allotted
time period or if the Company is otherwise unable to meet the continued
listing criteria of the Nasdaq SmallCap Market, the Company's common stock
will be subject to delisting. There can be no assurance that the Company will
be able to satisfy the minimum bid price or other continued listing criteria
at any time in the future or that, if pursued, any appeal by the Company of
any delisting determination would be successful. In the event that the
Company's common stock is delisted, the market value and liquidity of the
Company's common stock could be materially adversely affected.
12
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
To date, the Company has not utilized derivative financial instruments or
derivative commodity instruments. The Company invests cash in highly liquid
investments, consisting of highly rated U.S. and state government securities,
commercial paper, and short-term money market funds. These investments are
subject to minimal credit and market risk and the Company has no
interest-bearing debt. Therefore, the Company believes the market risks
associated with these financial instruments are immaterial.
13
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PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
NONE.
14
<Page>
SIGNATURE
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.
EZENIA! INC.
Date: May 15, 2002 By: /s/ Stephen G. Bassett
----------------------------------
Stephen G. Bassett
Vice President and
Chief Financial Officer
(Principal Financial and Accounting Officer,
Authorized Officer)
15