SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): December 27, 1999
SPATIALIZER AUDIO LABORATORIES, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 33-90532 95-4484725
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
20700 Ventura Boulevard, Suite 140, Woodland Hills, California 91364
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (818) 227-3370
1
Item 1. Changes in Control of Registrant.
Not applicable.
Item 2. Acquisition or Disposition of Assets.
Not applicable.
Item 3. Bankruptcy or Receivership.
Not applicable.
Item 4. Changes in Registrant's Certifying Accountant.
Not applicable.
Item 5. Other Events.
In December 1999, the Registrant completed a set of financial transactions
(the "December Transactions") with certain existing holders of the Registrant's
equity and debt and with new institutional investors. The December Transactions
included the private placement of 1,884,254 additional shares of the
Registrant's common stock, par value $.01 (the "Common Stock") ($1.05 million in
new capital or $0.55725 per share), the issuance of warrants to acquire
2,100,000 shares of Common Stock exercisable for three years at an exercise
price of $.67 per share), the cancellation of 500,000 warrants to acquire Common
Stock (at a variable exercise ratio), the conversion of $1 million of short term
debt into a new Series B Redeemable Convertible Preferred Stock ("Series B
Preferred Stock") and the conversion of $225,000 of secured debt into secured
long term convertible debt.
As a result of the December Transactions, 2,100,000 of the additional
shares of Common Stock to be authorized at the Registrant's Annual Meeting of
Stockholders are required to be reserved for grant on exercise of the warrants
issued in the December Transactions. Also, other shares of Common Stock will be
required if the conversion options underlying the Series B Preferred Stock or
the long term debt are exercised but the number of shares will vary depending on
the market price of the Registrant's Common Stock at the time of conversion. The
participants in the December Transactions acknowledged that stockholder approval
of an increase in the Registrant's total authorized capital stock at the
Registrant's Annual Meeting of Stockholders, was required to fully implement the
share issuances contemplated by those transactions. The Registrant's Annual
Meeting of Stockholders is currently scheduled to be held on February 10, 2000.
In the December Transactions, $895,000 in short term loan advances from
officers, directors and their affiliates and certain other securities holders,
and accrued interest of $134,647,
2
were restructured into the $1,000,000 in new Series B Preferred Stock. The
Series B Preferred Stock, and any dividends therefrom not converted into cash,
are convertible commencing in 2001 into restricted Common Stock at a 10%
discount, based on the 10 day average closing bid price prior to the conversion,
but subject to a minimum conversion of $.56 per share and a maximum of $1.12 per
share. The Company has a three year option to redeem any Series B Preferred
Stock, not sooner converted, in whole or in part, in cash.
Finally, in the December Transactions, $225,000 of secured debt, including
accrued interest, was converted into secured long term convertible debt. The
long term debt is held by existing institutional investors and is secured by
essentially all of the assets of the Company. The debt, and accrued interest, is
convertible at the Company's or the holder's options into registered Common
Stock at a conversion price equal to the average 10 day closing bid price prior
to conversion but subject to the same minimum and maximum conversion prices set
for the Series B Preferred Stock.
A copy of the press release dated January 3, 2000 describing the December
Transactions is attached as Exhibit A.
Item 6. Resignations of Registrant's Directors.
Not applicable.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
Not applicable.
Item 8. Change in Fiscal Year.
Not applicable.
SIGNATURES
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 hereunto duly authorized.
Spatializer Audio Laboratories, Inc.
Registrant
Date: January 17, 2000 By: /s/ Henry R. Mandell
--------------------------------------
Henry R. Mandell, Interim Chief
Executive Officer
3