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Shareholders
are encouraged to sign and return proxy cards promptly
MELVILLE,
N.Y., May 6, 2004 -- Andrea Electronics Corporation (AND)
announced today that its annual meeting of stockholders would
be held on Friday, May 21, 2004 at 2:00 p.m. local time at
the Company's main office in Melville, Long Island, New York.
Holders of record as of the close of business on April 20,
2004 are entitled to receive notice of and to vote at the
Annual Meeting of Stockholders. Andrea's annual meeting notice,
proxy statement and 2003 Annual Report were mailed to shareholders
of record on April 29, 2004.
At the
annual meeting, Andrea's stockholders will consider and act
on the following:
- The
election of eight directors to hold office until the next
annual
meeting of shareholders;
- The
ratification of the selection of Marcum & Kliegman LLP
as the
Company's independent accountants for the year ending December
31,
2004;
- The
ratification and approval of the issuance of 1,250,000 shares
of
Series D Convertible Preferred Stock and related warrants,
including
the terms and provisions of the Series D Convertible Preferred
Stock
providing for adjustment to the number of shares of common
stock into
which a share of Series D Convertible Preferred Stock may
be converted;
- The
approval of the issuance of an additional 1,250,000 shares
of
Series D Convertible Preferred Stock and related warrants;
- The
approval of an amendment to Andrea Electronics' restated
certificate of incorporation, as amended, to eliminate a
limitation on
the conversion of the Series C Convertible Preferred Stock;
and
- Such
other business as may properly come before the meeting.
The Board
of Directors recommends a vote "FOR" each of the
nominees for director, "FOR" ratification of Marcum
& Kliegman LLP as independent auditors, "FOR"
the issuance of 1,250,000 shares of Series D Convertible Preferred
Stock and the related warrants, including the terms and provisions
of the Series D Convertible Preferred Stock providing for
adjustment to the number of shares of common stock into which
a share of Series D Convertible Preferred Stock may be converted,
"FOR" the issuance of an additional 1,250,000 shares
of Series D Convertible Preferred Stock and the related warrants;
and "FOR" the amendment to Andrea Electronics' certificate
of incorporation, as amended, to eliminate a limitation on
the conversion of the Series C Convertible Preferred Stock.
Andrea's stockholders are encouraged to sign and return their
proxy cards promptly.
Andrea's
2003 Annual Report includes a President's letter to shareholders
which is reprinted as follows:
Dear
Shareholders,
As
many of you are aware, the Board of Directors of Andrea
Electronics
Corporation appointed me to the position of President and
Chief Executive
Officer of the Company in August 2003. I invested the first
few months
with Andrea gaining a thorough understand of the Company's
history,
namely where Andrea came from, where it now finds itself
and what the
expectations were for its future. During this time, the
Company's
products and markets were reviewed and an in depth analysis
was conducted
of the Company's overall operations and finance. Once this
was
accomplished, a number of strategic initiatives began to
emerge with an
eye towards eventually achieving desirable levels of performance.
In
November 2003, I outlined four key strategies that revolved
around
balance sheet restructurings, asset and technology rationalizations,
further expense reductions and broader and deeper sales
channel
penetrations. As reported in February 2004, the first initiative
was
successfully accomplished when a group of new investors
converted a
restrictive mezzanine position in the Company into permanent
equity.
This "debt" elimination on our balance sheet immediately
paved the way
for a fresh infusion of capital, which took the form of
$1.25 million of
immediate financing for Andrea and another $1.25 million
upon shareholder
approval and registration.
In
March 2004, we reported that the second key strategy was
completed
through the transformation and streamlining of our Lamar
Signal
Processing operation in Israel into an engineering and customer
support
center. The Company needed to place less emphasis on research
and
development activities, since much of Andrea's core technology
is already
embedded in our portfolio of products, and needs to place
heightened
emphasis on sales and marketing in order to further expand
revenues.
Full
year revenues in 2003 increased 30% as compared to 2002
and full
year combined research and development costs and general,
administrative
and selling expenses in 2003 decreased 21% as compared to
2002. While
these results are encouraging, further top line revenue
increases and
continued expense reductions remain key strategic initiatives
for the
Company. Our revenue is improving and our losses are narrowing,
especially as evidenced by our reported financial performance
in the past
few quarters, but much work still needs to be done especially
in the top
line revenue generating area.
Andrea's
core competency is in headsets and it is my intention to
exploit
that potential as much as possible. An increasing number
of businesses
are utilizing distance learning and on-line collaboration
software, which
uses our noise canceling headset products. In addition,
the Company
still maintains a healthy and vibrant portfolio of audio
software
products that will continue to be marketed, especially in
the personal
computing market. Our patented technologies and algorithms,
which
include ANR, PureAudio, DSDA, DFTA and EchoStop, continue
to draw
attention from the marketplace in a variety of current uses
and potential
future applications.
Andrea
Electronics celebrates its 70th year in business in 2004.
The
Company has an illustrious history and it is one in which
I am now proud
to be a part of. In my short tenure here at the Company,
I have found a
very dedicated staff of employees that share a common vision
of what
Andrea can again become. I enjoy working along side each
of these
individuals and I am cautiously optimistic about the Company's
prospects
for the future. I remain very appreciative of the continued
support of
Andrea's Board of Directors, stockholders and especially
its customers as
we continue to strive towards a more prosperous future for
our Company.
Very
Truly Yours,
Paul
E. Donofrio
Paul
E. Donofrio
President and Chief Executive Officer
About
Andrea Electronics
Andrea
Electronics Corporation designs, develops and manufactures
audio technologies and equipment for enhancing applications
that require high performance and high quality voice input.
The Company's patented Digital Super Directional Array (DSDA),
patented PureAudio, patented EchoStop and patent-pending Directional
Finding and Tracking Array (DFTA) far-field microphone technologies
enhance a wide range of audio products to eliminate background
noise and ensure the optimum performance of voice applications.
Applications for the Company's technologies include: speech
recognition programs, Internet telephony, video/audio conferencing,
automobile PCs, home automation systems, hand-held devices
and multiplayer online games, among others. Visit Andrea Electronics'
website at www.AndreaElectronics.com
or call 1-800-707-5779.
This press
release may contain "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of
1995. The words "anticipates," "believes," "estimates," "expects,"
"intends," "plans," "seeks," variations of such words, and
similar expressions are intended to identify forward-looking
statements. These statements are not guarantees of future
performance and involve matters that are subject to certain
risks, uncertainties and assumptions that are difficult to
predict, including economic, competitive, governmental, technological
and other factors, that may affect the business and prospects
of Andrea Electronics Corporation (the "Company"). The Company
cautions investors about the following significant factors,
which, among others, have in some cases affected the Company's
actual results and are in the future likely to affect the
Company's actual results and could cause them to differ materially
from those expressed in any forward- looking statements: the
rate at which Andrea Anti-Noise, DSDA, DFTA and other Andrea
technologies are accepted in the marketplace; the competitiveness
of Andrea Anti-Noise, DSDA, DFTA and other Andrea products
in terms of technical specifications, quality, price, reliability
and service; the sufficiency of the Company's funds for research
and development, marketing and general and administrative
expenses; infringement and other disputes relating to patents
and other intellectual property rights held or licensed by
the Company or third parties; the Company's continuing ability
to enter and maintain collaborative relationships with other
manufacturers, software authoring and publishing companies,
and distributors; the emergence of new competitors in the
marketplace; the Company's ability to compete successfully
against established competitors with greater resources; the
uncertainty of future governmental regulation; the Company's
ability to obtain additional funds; and general economic conditions.
No assurance can be given that the Company will achieve any
material sales or profits from the products introduced in
this release. These and other similar factors are discussed
under the heading "Cautionary Statement Regarding Forward-looking
statements" included in the Management's Discussion and Analysis
of Financial Condition and Results of Operations in the Company's
Annual Report on Form 10-K and in the Company's Annual Report
to shareholders, and in documents subsequently filed by the
Company with the Securities and Exchange Commission.
AT ANDREA
ELECTRONICS CORPORATION
Corisa L. Guiffre
Chief Financial Officer
1-800-447-7787
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