SANTA CLARA, Calif., Sept. 24 /PRNewswire-FirstCall/ -- NeoMagic
Corporation (Nasdaq: NMGC) announced today a cessation of efforts to raise
additional capital. As a result, NeoMagic is making efforts to wind-down its
operations and has terminated employment for substantially all of its
operational and engineering employees in all worldwide locations. Beginning
September 19, 2008, management, acting based upon a plan approved by the Board
of Directors, eliminated 52 positions in the Company. At this time, the
Company is unable to determine the amounts of one-time termination benefits,
contract termination costs and other associated costs and expected cash flows
associated with its wind-down activities.
The Company is taking action to maintain continuity of supply of its
products to current customers. The Company also intends to take actions to
realize the value from its remaining assets for the benefit of creditors. The
Company does not currently anticipate that any proceeds will be available for
distribution to its shareholders following payment of its liabilities.
On September 23, 2008, Brett Moyer, Carl Stork and David Tomasello, each
independent directors of the Company, and in the case of Messrs. Moyer and
Stork, members of the Company's audit committee, notified the Company that
they were resigning as directors of NeoMagic Corporation effective
September 23, 2008.
In addition, as anticipated, the Company received a Nasdaq Staff
deficiency letter on September 18, 2008, indicating that the Company no longer
complies with Marketplace Rule 4310(c)(3), which requires the Company to have
a minimum of $2.5 million of shareholders' equity or $35.0 million of market
value of listed securities or $0.5 million of net income from continuing
operations for the most recently completed fiscal year or two of the three
most recently completed fiscal years. Based upon the Company's Form 10-Q for
the quarter ended July 27, 2008, these requirements have not been satisfied.
The Company currently does not expect to maintain its listing on The Nasdaq
Capital Market and will not seek to challenge delisting for failure to meet
various requirements. In addition, the Company has requested Nasdaq to
suspend trading in its common stock immediately for an indefinite period of
time.
(Logo: http://www.newscom.com/cgi-bin/prnh/20020802/NMGCLOGO)
Contact Information:
Steve Berry
NeoMagic Corporation
Chief Financial Officer
(408) 988-7020
SOURCE NeoMagic Corporation