UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: March 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission file number: 000-27582
CellularVision USA, Inc.
(Exact name of registrant as specified in its charter)
Delaware
13-3853788
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer Identification No.)
505 Park Avenue
New York, New York
10022
(Address of principal executive offices)
(Zip Code)
(212) 751-0900
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if
changed
since last report)
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 No
X
The number of outstanding shares the registrant's common
stock, par value U.S. $.01 per share, as of March 31, 1996
was 16,000,000.
Total number of pages in this Report including Exhibits, if
any: 14
There are no exhibits filed as part of this Report.
CELLULARVISION USA, INC.
INDEX TO FORM 10-Q
Page(s)
PART I -- FINANCIAL INFORMATION
ITEM 1 -- Financial Statements
Consolidated Balance Sheets as of December 31,
1995 and the Three Months Ended March 31,
1996 (unaudited) 1
Consolidated Statements of Operations for the
Three Months Ended March 31, 1995 and the
Three Months Ended March 31, 1996 (unaudited) 2
Consolidated Statements of Cash Flows for the
Three Months Ended March 31, 1995 and the
Three Months Ended March 31, 1996 (unaudited) 3-4
Notes to Consolidated Financial Statements (unaudited) 5-6
ITEM 2 -- Management's Discussion and Analysis of
Financial Condition and Results of Operations 7-9
PART II -- OTHER INFORMATION
ITEM 1 -- Legal Proceedings 10
ITEM 2 -- Changes in Securities 10
ITEM 3 -- Defaults Upon Senior Securities 10
ITEM 4 -- Submission of Matters to a Vote
of Security Holders 10
ITEM 5 -- Other Information 10
ITEM 6 -- Exhibits and Reports on Form 8-K 11-13
Signature Page 14
PART I - FINANCIAL INFORMATION
ITEM 1- Financial Statements
CELLULARVISION USA, INC.
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
ASSETS December 31, 1995 March
31, 1996
(Unaudited)
Current assets:
Cash and cash equivalents $3,536,354
$35,221,020
Accounts receivable, net of allowance
for doubtful accounts of $133,730 and $119,344 410,141
377,467
Due from affiliates -
632,492
Prepaid expenses and other 228,803
251,323
Deferred offering costs 1,619,972 -
_________ ________
Total current assets 5,795,270
36,482,302
Property and equipment, net of accumulated
depreciation of $981,466 and $1,449,132 6,321,768
6,747,704
Intangible assets, net of accumulated
amortization of $39,564 and $46,401 97,177
90,339
Debt placement fees 622,678 255,363
Other noncurrent assets 158,594 107,819
Total assets $12,995,487 $
43,683,527
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY
Current liabilities:
Accounts payable. $355,490 $729,704
Accrued liabilities 2,246,349 879,072
Due to affiliates 1,294,812 -
Note payable to affiliate 3,521,257
- - -
Other current liabilities 24,799
11,984
Total current liabilities 7,442,707
1,620,760
Convertible exchangeable
subordinated notes payable. 12,576,324
- - -
Exchange notes 6,295,017 6,254,709
Total liabilities 26,314,048
7,875,469
Commitments and contingencies (Note 8)
Stockholders' (deficit) equity:
Common Stock, ($.01 par value; 40,000,000
shares authorized; 12,395,142 and
16,000,000 shares issued and outstanding) 123,951
160,000
Preferred Stock, ($.01 par value; 20,000,000
shares authorized; none issued and
outstanding)
Additional paid-in capital
Deficit accumulated during
the development stage 6,401,454
58,267,533
(19,843,966)
(22,619,475)
Stockholders' (deficit) equity
(13,318,561) 35,808,058
Total liabilities and Stockholders'
(deficit) equity $12,995,487
$ 43,683,527
The accompanying notes are an integral part of these
financial statements.
CELLULARVISION USA, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
January 1, 1992
(date of Three Months Ended March 31,
inception) to March 31,
1995 1996 1996
Revenue $17,674 $493,682 $1,796,899
Expenses:
Service costs 11,258 286,148
954,842
Selling, general and
administrative 1,057,204 2,188,180 13,006,991
Management fees 673,175 -
4,494,941
Depreciation and
amortization 88,657 474,503
2,162,920
1,830,294 2,948,831 20,619,694
Operating loss (1,812,620) (2,455,149)
(18,822,759)
Interest income 156,470 143,349
1,173,887
Interest expense (559,942) (463,709)
(4,970,567)
Net loss $(2,216,092) $(2,775,509)
$(22,619,475)
Net loss per
common share $(.18) $(.20)
Weighted average
number of shares
of common stock 12,395,142 13,816,776
The accompanying notes are an integral part of these
financial statements.
CELLULARVISION USA, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Three Months Ended March
31, Jan 1, 1992(date of
inception) to March 31
1995 1996 1996
Cash flows from operating activities:
Net loss.... $ (2,216,092) $
(2,775,509) $ (22,619,475)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation
and amortization 88,657 474,503
2,162,920
Amortization
of placement fees 57,268 27,094
379,729
Provision for
doubtful accounts 526 111,208 313,316
Stock option
compensation
expense 150,000 150,000
Changes in assets
and liabilities:
Accounts receivable 985 (78,534) (690,786)
Prepaid expenses
and other (48,129) (25,124) (65,473)
Accounts payable
and accrued liabilities (29,892) (264,614)
682,878
Other current
liabilities 55,997 (12,815) 9,734
Due to affiliates 451,161 (1,927,304)
2,722,536
Accrued interest 502,679 4,955
3,876,296
Other noncurrent
assets 3,782 50,775
(107,819)
Net cash used in
operating activities (1,133,058) (4,265,365)
(13,186,144)
Cash flows from
investing activities:
Intangibles (136,741)
Property and
equipment additions (1,519,922) (893,602)
(11,331,969)
Proceeds from
sale of property
and equipment 2,608,261
Purchase of
available-for-sale
securities (2,925,711)
(26,916,209)
Maturities of
available-for-sale
securities 5,293,208 26,916,209
Net cash provided
by (used in)
investing activities 847,575 (893,602)
(8,860,449)
Cash flows from financing activities:
Advance to HCM
stockholders
(3,000,000)
Contributions 10,821,878
Distribution (8,331) 13,889
(1,308,836)
Convertible exchangeable
subordinated notes payable
15,000,000
Proceeds from sale of stock 41,850,000
41,850,000
Repayment of note payable affiliate (3,521,257)
(3,521,257)
Payment of deferred offering costs (1,498,999)
(1,598,861)
Placement costs (65,951) (975,311)
Net cash (used in)
provided by
financing activities (74,282) 36,843,633
57,267,613
Net (decrease) increase
in cash and
cash equivalents (359,765) 31,684,666
35,221,020
Cash and cash
equivalents, beginning
of period 7,421,171 3,536,354 -
Cash and cash
equivalents, end
of period $7,061,406 $35,221,020
$35,221,020
The accompanying notes are an integral part of these
financial statements.
CELLULARVISION USA, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
January 1, 1992
(date of Three Months Ended March 31,
inception) to March 31,
1995 1996 1996
Supplemental Cash
Flow Disclosures:
Cash paid for interest
during the period - $315,978
$315,978
Noncash transactions:
Common stock issued
for convertible debt - 12,731,450
12,731,450
Write-off of debt
placement fees in
connection with
conversion of debt for
common stock - 342,826
342,826
The accompanying notes are an integral part of these
financial statements.
CELLULARVISION USA, INC.
(A Development Stage Company)
NOTES TO COMBINED FINANCIAL STATEMENTS
1. Basis of Presentation
The accompanying unaudited consolidated financial statements
have been prepared in accordance with generally accepted
accounting principles for interim financial information and
with the instructions to Form 10-Q and Rule 10-01 of
Regulation S-X. They do not include all information and
notes required by generally accepted accounting principles
for complete financial statements. However, except for the
events disclosed in Note 2, there has been no other material
change in the information disclosed in the notes to the
consolidated financial statements for the Company's fiscal
period ended March 31, 1996, as compared to the year ended
December 31, 1995.
In the opinion of the Management, all adjustments
(consisting of normal recurring accruals) considered
necessary for a fair presentation have been included.
Operating results for the three-month period ended March 31,
1996 are not necessarily indicative of the results that may
be expected for the year ending December 31, 1996.
2. Initial Public Offering
The Company completed its Initial Public Offering which was
consummated on February 13, 1996. The net proceeds to the
Company from the Initial Public Offering, after deducting
underwriting discounts and commissions of $1.05 per share
and approximately $2.5 million in other expenses, was
$41,350,000.
Immediately prior to the Initial Public Offering, the
Company effected the following events (collectively, the
"Incorporation Transactions"): (i) $10 million principal
amount of the convertible exchangeable subordinated notes
was converted into 4,547 shares of Common Stock pursuant to
their conversion provisions, (ii) the Company issued an
aggregate of 93,180 shares of Common Stock to the
stockholders of HCM (the "Founders") in exchange for all
outstanding capital stock of HCM, and the holders of certain
partnership interests of CVNY in exchange for all of their
partnership interests in CVNY, and (iii) the Company
effected a 133.0236284-for-1 stock split of the outstanding
shares of Common Stock and issued an aggregate of 13,000,000
shares of Common Stock to the holders thereof. As a result
of the consummation of the Incorporation Transactions, the
Company is the sole stockholder of HCM, the managing general
partner of CVNY, and CVNY continues to carry on its business
as an indirect wholly owned subsidiary of the Company.
Stockholders' equity, and all per share data, have been
restated to give retroactive recognition to the stock split
in prior periods.
3. Legal Proceedings
In November 1995, a purported class action suit was
filed against the Company in New York State Supreme Court
alleging that the Company had engaged in a systematic
practice of installing customer premises equipment in
multiple dwelling units without obtaining certain landlord
or owner consents allegedly required by law. The suit seeks
injunctive relief and $4 million in punitive damages. The
suit is in its preliminary stages and although the Company
believes that it has meritous defenses to the claims
asserted against it, and intends to defend itself
vigorously, the ultimate outcome of this matter cannot be
determined at the present time. There can be no assurance
that any recovery by the plaintiffs will not have a material
adverse effect on the financial condition or operating
results of the Company in the period in which the matter is
resolved.
In February 1996, a suit was filed against the Company
alleging that the Company caused the U.S. Army to breach a
contract with the plaintiff wherein the plaintiff was to
have an exclusive right to provide cable television services
at an army base located in Brooklyn, New York. The suit
alleges that by entering into a franchise agreement with the
Army which grants the Company the right to enter the army
base to build, construct, install, operate and maintain its
multi-channel broadband cellular television system, the
Company induced the Army to breach its franchise agreement
with the plaintiff. The Army has advised the Company that
it has the right to award the franchise to the Company and
the Company is continuing to provide service to the army
base. The suit seeks $1 million in damages and is in its
preliminary stages. The Company cannot make a determination
at this time as to the possible outcome of the action or
whether the case will go to trial. The Company does not
believe that in the event an adverse judgment is rendered,
the effect would be material to the Company's financial
position but it could have a material effect on operating
results in the period in which the matter is resolved.
4. Recently Adopted Financial Accounting Pronouncements
Effective January 1, 1996, the Company adopted SFAS No.
123 "Accounting for Stock-Based Compensation," which
statement allows companies either to measure the
compensation cost in connection with employee stock
compensation plans using a fair value based method or
continue to use the intrinsic value based method, which
generally does not result in compensation cost.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND
RESULTS OF OPERATIONS
The following discussion and analysis of financial
condition and results of operations should be read in
conjunction with the corresponding discussion and analysis
included in the Company's Report on Form 10-K for the year
ended December 31, 1995.
Results of Operations
The operational priority for the first three months of
1996 was the smooth transition to a CellularVision
management team, from a system run by Bell Atlantic
Corporation management the past two years. In addition to
subscriber growth and churn issues, the company focused on
the launch of its third cell on April 5th and the transition
of an experimental cell to full commercial deployment.
The company began offering premium programming services
in April 1995 and Pay-Per-View services at the end of June
1995. As a result the Company experienced an increase in
average monthly revenue per subscriber of $15.00, from
$29.00 for the month of March 1995 to $44.00 for the month
of March 1996. The Company's pay-to-basic ratio (the number
of premium channels subscribed to, divided by the aggregate
number of subscribers) at March 31, 1996 was 277%. The Pay-
Per-View buy rate (the number of pay-per-view events
purchased per month, divided by the aggregate number of
subscribers) was 32% in March 1996.
In 1995, an average of approximately 11.3 percent of
the Company's subscribers per month canceled their service.
This was due in large part to two manufacturing flaws in the
set-top converter which degraded reception quality. Due to
these flaws, the company sharply reduced its marketing
efforts in October of 1995.
The set-top box vendor, at their expense, corrected the
manufacturing flaws during the first three months of 1996.
The Company conducted extensive field trials before re-
deploying the product. As a result the Company experienced
a reduction in churn to an average of 9.2% in this period.
The churn in the first commercial cell which averaged 10.8%
for 1995 was reduced to 5.6% for the quarter. Sales and
Marketing efforts resumed on April 5, 1996 and include door-
to-door, direct mail and telemarketing campaigns. In our
initial month of marketing the Company added over 500 new
subscribers bring our current total to approximately 4500.
The Company intends to increase its marketing efforts over
the next few months.
Three Months Ended March 31, 1996 Compared to Three Months
Ended March 31, 1995.
Revenue increased $476,000 from $18,000 for the three
months ended March 31, 1995 to $494,000 for the three months
ended March 31, 1996. The increase in revenue is
attributable to an increase in subscribers and the addition
of premium and pay-per-view services during April and June
1995, respectively.
Operating expenses increased $1,119,000 from $1,830,000
for the three months ended March 31, 1995 to $2,949,000 for
the three months ended March 31, 1996. This increase is
primarily attributable to costs associated with the
Company's commercial roll-out, including service costs,
selling, general and administrative expenses, and
depreciation and amortization.
Service costs increased $275,000 from $11,000 for the
three months ended March 31, 1995 to $286,000 for the three
months ended March 31, 1996. Such costs, primarily fees paid
to providers of television programming increase with the
growth in subscribers.
Selling, general and administrative expenses increased
$1,131,000 from $1,057,000 for the three months ended March
31, 1995 to $2,188,180 for the three months ended March 31,
1996. The increase in selling, general and administrative
expenses is primarily attributable to headcount-related
costs (as the Company's employee base rose from 33 at March
31, 1995 to 63 at March 31, 1996), sales and marketing-
related costs and increased legal costs associated with the
FCC licensing process. Legal costs attributable to FCC
matters should decrease as the FCC makes its final decision
on the LMDS rulemaking proceedings. As the build-out of its
network of transmitters continues, the Company intends to
implement a variety of mass marketing programs which should
result in an increase in total sales and marketing expenses.
Management fees decreased $673,000 from $673,000 for
the three months ended March 31, 1995 to $0 for the three
months ended March 31, 1996. The decrease in management fees
is attributable to the termination of the management
agreement with Bell Atlantic Corporation.
Depreciation and amortization increased $386,000 from
$89,000 for the three months ended March 31, 1995 to
$475,000 for the three months ended March 31, 1996. The
increase in depreciation and amortization costs was due
primarily to the purchase of customer premises equipment,
equipment for three transmitter sites and the continued
build-out of the Company's customer service/administrative
facility.
Interest expense decreased $96,000 from $560,000 for
the three months ended March 31, 1995 to $464,000 for the
three months ended March 31, 1996. This decrease is due
primarily to the conversion of approximately $12.6 million
of convertible exchangeable subordinate notes payable to
common stock in conjunction with the IPO, and the repayment
of approximately $3.5 million of notes payable from the
proceeds of the IPO.
The net loss for the three months ended March 31, 1996
was $2,776,000 compared to a net loss of $2,216,000 for the
three months ended March 31, 1995. The increase in net loss
is due primarily to increased operating expenses due to
costs associated with the Company's commercial rollout and
increased subscriber base.
Liquidity and Capital Resources
In February 1996, the Company consummated the Initial
Public Offering of 3,333,000 shares of Common Stock
(including an aggregate of 333,000 shares sold by certain
shareholders of the Company) at the initial offering price
of $15.00 per share. The net proceeds to the Company from
the Initial Public Offering, after deducting underwriting
discounts and commissions of $1.05 per share and
approximately $2.5 million of other expenses, were
approximately $39,350,000.
The Company expects that the net proceeds of the
Initial Public Offering and internally generated funds will
be sufficient to build out its multichannel broadband
cellular television system to pass most of the households in
the New York PMSA, and believes that its sources of capital,
including internally generated funds and the net proceeds of
the Initial Public Offering, will be adequate to satisfy
anticipated capital needs and operating expenses for the
year.
For the three months ended March 31, 1996, the Company
expended $4,265,000 on operating activities. Of these
activities $2.3 million represents the payment of
liabilities and obligations incurred during the fourth
quarter of 1995. During the same period, capital
expenditures were $894,000, consisting primarily of
transmitter deployment and the purchase of customer premises
equipment. The Company anticipates 1996 capital expenditures
of approximately $34 million, which include the cost of
constructing approximately 17 additional cell sites, an
additional head-end facility, purchasing customer premises
equipment, related installation costs and various office-
and warehouse-related costs. The actual amount of costs for
such capital expenditures may differ.
With proceeds from the initial public offering, the
Company paid approximately $3.6 million in principal and
interest to Bell Atlantic Corporation to satisfy the note
payable at December 31, 1995.
The Company paid $1.5 million of deferred offering
costs during the first quarter.
The Company has recorded net losses and negative
operating cash flow in each period of its operations since
inception. While such losses and negative operating cash
flow are attributable to the start-up costs incurred in
connection with the roll-out of the Company's system, the
Company expects to continue experiencing operating losses
and negative cash flow for at least one year as a result of
its planned expansion within the New York PMSA.
The Company is able to control the timing of deployment
of capital resources based on the variable cost nature of
the business and the incremental fixed cost per transmitter
site constructed. The Company's current business strategy is
based on rapid subscriber growth. Should capital
conservation measures be required, the Company may slow the
rate of subscriber growth or delay additional transmitter
deployment, enabling the Company to operate for an extended
period of time.
PART II - OTHER INFORMATION
ITEM 1 -- LEGAL PROCEEDINGS
Prior to 1992, Vahak and Shant Hovnanian were officers,
directors and principal shareholders of Riverside Savings
Bank, a state-chartered savings and loan association that
entered receivership in 1991. In certain civil litigation
against the Hovnanians and others that ensued, which is
pending in the U.S. District Court for the District of New
Jersey, the Resolution Trust Corporation has alleged simple
and gross negligence and breaches of fiduciary duties of
care and loyalty on the part of the defendants. Although
this action is still in its preliminary stages, the
defendants have obtained dismissal of certain allegations
and intend to continue to vigorously defend the action.
In November 1995, a purported class action suit was filed
against the Company in New York State Supreme Court alleging
that the Company had engaged in a systematic practice of
installing customer premises equipment in multiple dwelling
units without obtaining certain landlord or owner consents
allegedly required by law. The suit seeks injunctive relief
and $4 million in punitive damages. The suit is in its
preliminary stages and although the Company believes that it
has meritorious defenses to the claims asserted against it,
and intends to defend itself vigorously, the ultimate
outcome of this matter cannot be determined at the present
time. There can be no assurance that any recovery by the
plaintiffs will not have a material adverse effect on the
financial condition or operating results of the Company in
the period in which the matter is resolved.
In February 1996, a suit was filed against the Company
alleging that the Company caused the U.S. Army to breach a
contract with the plaintiff wherein the plaintiff was to
have an exclusive right to provide cable television services
at an army base located in Brooklyn, New York. The suit
alleges that by entering into a franchise agreement with the
Army which grants the Company the right to enter the army
base to build, construct, install, operate and maintain its
multi-channel broadband cellular television system, the
Company induced the Army to breach its franchise agreement
with the plaintiff. The Army has advised the Company that
it has the right to award the franchise to the Company and
the Company is continuing to provide service at the army
base. The suit seeks $1 million in damages and is in its
preliminary stages. The Company cannot make a determination
at this time as to the possible outcome of the action or
whether the case will go to trial. The Company does not
believe that in the event an adverse judgment is rendered,
the effect would be material to the Company's financial
position but it could have a material effect on operating
results in the period in which the matter is resolved.
ITEM 2 -- CHANGES IN SECURITIES
None.
ITEM 3 -- DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4 -- SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS
None.
ITEM 5 -- OTHER INFORMATION
None.
ITEM 6 -- EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits:
3.1*
Certificate of Incorporation.
3.2*
By-laws.
4.1*
Form of Common Stock Certificate.
4.2*
Stockholders Agreement, dated as of January 12, 1996, by and
among CellularVision USA, Inc., Shant S. Hovnanian, Bernard
B. Bossard and Vahak S. Hovnanian.
4.3*
Registration Rights Agreement, dated as of January 12, 1996,
by and among CellularVision USA, Inc., Bell Atlantic
Ventures XXIII, Inc., Philips PGNY Corp., Inc. and Morgan
Guaranty Trust Company of New York, as Trustee of the
Commingled Pension Trust Fund (Multi-Market Special
Investment) of Morgan Guaranty Trust Company of New York,
and as Investment Manager and Agent for an Institutional
Investor.
10.1*
Amended and Restated License Agreement, together with
Addendum to License Agreement, each dated as of July 7,
1993, by and between CellularVision Technology &
Telecommunications, L.P. and CellularVision of New York,
L.P. and certain amendments and supplements thereto.
10.2*
Reserved Channel Rights Agreement, dated as of July 7, 1993,
by and between Vahak S. Hovnanian, Shant S. Hovnanian,
Bernard B. Bossard, CellularVision of New York, L.P. and
Bell Atlantic Ventures XXIII, Inc.
10.3*
Restructuring Agreement, dated as of January 12, 1996, by
and among the Company, CellularVision of New York, L.P., Hye
Crest Management, Inc., Suite 12 Group, Bell Atlantic
Ventures XXIII, Inc., Philips PGNY Corp., Morgan Guaranty
Trust Company of New York, as Trustee of the Commingled
Pension Trust Fund (Multi-Market Special Investment) of
Morgan Guaranty Trust Company of New York, and as Investment
Manager and Agent for an Institutional Investor, Shant S.
Hovnanian, Bernard B. Bossard and Vahak S. Hovnanian.
10.4*
CellularVision USA, Inc. 1995 Stock Incentive Plan.
10.5*
Employment Agreement, dated as of October 18, 1995, between
CellularVision USA, Inc. and Bernard B. Bossard.
10.6*
Employment Agreement, dated as of October 18, 1995, between
CellularVision USA, Inc. and Shant S. Hovnanian.
10.7*
Employment Agreement, dated as of January 1, 1996, between
CellularVision USA, Inc. and John Walber.
10.9*
Intercompany Agreement, dated January 12, 1996, by and among
CellularVision USA, Inc., CellularVision Technology &
Telecommunications, L.P., CellularVision of New York, L.P.,
Shant S. Hovnanian, Bernard B. Bossard and Vahak S.
Hovnanian.
10.10*
Second Addendum to License Agreement, dated as of January
12, 1996, by and between CellularVision Technology &
Telecommunications, L.P. and CellularVision of New York,
L.P.
10.11*
Corporate Name License and Grant of Future Licenses
Agreement, dated as of January 12, 1996, by and between
CellularVision Technology & Telecommunications, L.P. and
CellularVision USA, Inc.
10.12*
Amended and Restated Agreement of Limited Partnership of
CellularVision of New York, L.P., dated as of July 7, 1993,
by and between Hye Crest Management, Inc., Bell Atlantic
Ventures, XXIII, Inc. and the limited partners set forth on
the signature page thereto.
10.13*
Master Amendment Agreement, dated as of October 8, 1993, by
and among Vahak S. Hovnanian, Shant S. Hovnanian, Bernard B.
Bossard, Hye Crest Management, Inc., Suite 12 Group,
CellularVision of New York, L.P., CellularVision Technology
& Telecommunications, L.P., Bell Atlantic Ventures XXIII,
Inc. and Philips PGNY Corp.
10.14*
Second Master Amendment Agreement, dated as of December 29,
1993, by and among Hye Crest Management, Inc., Suite 12
Group, CellularVision of New York, L.P., CellularVision
Technology & Telecommunications, L.P., Bell Atlantic
Ventures XXIII, Inc., Philips PGNY Corp., Morgan Guaranty
Trust Company of New York, as trustee of the Commingled
Pension Trust Fund (Multi-Market Special Investment) of
Morgan Guaranty Trust Company of New York, and as Investment
Manager and Agent for an Institutional Investor.
10.15*+
Note Purchase Agreement, dated as of December 29, 1993,
between CellularVision of New York, L.P. and Morgan Guaranty
Trust Company of New York, as trustee of the Commingled
Pension Trust Fund (Multi-Market Special Investment) of
Morgan Guaranty Trust Company of New York with respect to
the issuance and sale of $12,000,000 principal amount of
Convertible Exchangeable Subordinated Notes of
CellularVision of New York, L.P.
10.16*
Agreement of Lease, dated May 9, 1994, by and between
Cellular Vision of New York and New York City Economic
Development Corporation and Sublease, dated March 8, 1995,
between CellularVision of New York, L.P. and Harvard Fax,
Inc.
10.17*
Communications Antenna Site Agreement, dated December 6,
1994, between CellularVision of New York L.P. and Tower
Owners, Inc., as amended.
10.18*
Master Lease Agreement No. 6035, dated December 12, 1995,
between Linc Capital Management, a division of Scientific
Leasing Inc., and CellularVision of New York, L.P., together
with the Schedules and Addendum No. 1 thereto; Warrant
Certificate Nos. 1, 2 and 3, dated December 14, 1995, issued
to Linc Capital Partners, Inc. by the Company.
10.19*
Master Equipment Lease, dated December 14, 1995 between
Boston Financial & Equity Corporation and CellularVision of
New York, L.P., together with the Schedules and the Addendum
thereto; Warrant Certificate Nos. 4 and 5, dated December
14, 1995, issued to Boston Financial & Equity Corporation by
the Company.
10.20*
Senior Convertible Term Note, dated December 1, 1995, in the
principal amount of $3,521,257 issued to Bell Atlantic
Ventures XXIII, Inc. by CellularVision of New York, L.P. and
CellularVision USA, Inc. and the Agreement, dated as of
December 1, 1995, by and among CellularVision USA, Inc.,
CellularVision of New York, L.P., and Bell Atlantic Ventures
XXIII, Inc.
10.21*
Warrant, dated June 1, 1994, issued by CellularVision of New
York, L.P. to Alex. Brown & Sons Incorporated.
10.22*
Warrant, dated June 1, 1994, issued by CellularVision of New
York, L.P. to Mark B. Fisher.
10.23*
Warrant, dated December 29, 1993, issued by CellularVision
of New York, L.P. to Peter Rinfret.
10.24*
Warrant, dated October 8, 1993, issued by Vahak S. Hovnanian
and Shant S. Hovnanian to Alex. Brown Financial Corporation.
10.25*
Warrant, dated October 8, 1993, issued by Vahak S. Hovnanian
and Shant S. Hovnanian to Mark B. Fisher.
10.26*
Non-qualified Stock Option Agreement under the
CellularVision USA, Inc. 1995 Stock Incentive Plan, dated as
of January 15, 1996, by and between the Company and John
Walber.
10.27*
Non-qualified Stock Option Agreement under the
CellularVision USA, Inc. 1995 Stock Incentive Plan, dated as
of January 15, 1996, by and between the Company and George
J. Parise.
10.28*
Agreement, dated as of January 12, 1996, by and among
CellularVision USA, Inc., CellularVision of New York, L.P.,
Hye Crest Management, Inc., Shant S. Hovnanian, Vahak S.
Hovnanian, Bernard B. Bossard and Bell Atlantic Ventures
XXIII, Inc.
10.29
Exchange Notes, dated as of December 15, 1995, of
CellularVision USA, Inc. issued to Morgan Guaranty Trust
Company of New York, as trustee of the Commingled Pension
Trust Fund (Multi-Market Special Investment) of Morgan
Guaranty Trust Company of New York, and as Investment
Manager and Agent for an Institutional Investor, in the
principal amounts of approximately $5.0 million and $1.3
million, respectively (form of Exchange Note included as
Exhibit A-2 to Exhibit 10.15 above).
21*
Subsidiaries of CellularVision USA, Inc.
23.1*
Consent of Coopers & Lybrand L.L.P.
23.2
Consent of Willkie Farr & Gallagher (included in Exhibit 5).
24*
Power of Attorney.
__________________
* Incorporated by reference to the Company's Registration
Statement in Form S-1 (File No. 33-98340) which was declared
effective by the Commission on February 7, 1996.
+ An identical note purchase agreement has been entered into
by CellularVision of New York, L.P. and Morgan Guaranty
Trust Company of New York, as Investment Manager and Agent
for an Institutional Investor with respect to the issuance
and sale of $3,000,000 principal amount of Convertible
Exchangeable Subordinated Notes of CellularVision of New
York, L.P.
b. Current Reports on Form 8-K:
The Registrant did not file any reports on Form 8-K during
the period beginning January 1, 1996 and ending March 31,
1996.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, as amended, the registrant has duly caused this
report to be signed on its behalf by the undersigned
thereunto duly authorized.
CELLULARVISION USA, INC.
Date: May 15, 1996 By: /s/ Shant S.
Hovnanian
Shant S. Hovnanian
President and
Chief Executive Officer
??
(..continued)
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FORM10Q.DOC
CELLULARVISION USA, INC.
(A Development Stage Company)
NOTES TO COMBINED FINANCIAL STATEMENTS - (Continued)
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