<PAGE>
FORM 10 - Q
SECURITIES AND EXCHANGE COMMISSION
Washington D.C 20549
----------------------
X Quarterly report pursuant to Section 13 or 15(d)
---
of the Securities Exchange Act of 1934 for the
quarterly period ended June 30, 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: 0-20789
OneWave, Inc.
-------------
(Exact name of registrant as specified in its charter)
Delaware 04-3249618
-------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Arsenal Marketplace, Second Floor, Watertown, Massachusetts 02172
---------------------------------------------------------------------
(Address of principal executive offices)
Registrant's telephone number, including area code: (617) 923-6500
--------------
_______________
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
---
As of July 31, 1996 there were 14,757,770 shares of Common Stock outstanding.
<PAGE>
ONEWAVE, INC.
Table of Contents
<TABLE>
<CAPTION>
Page
----
<S> <C>
PART I - FINANCIAL INFORMATION
Item 1. Condensed Financial Statements
Condensed Balance Sheets at June 30, 1996 and
December 31, 1995. 3
Condensed Statements of Operations for the three
months and six months ended June 30, 1996 and 1995. 4
Condensed Statements of Cash Flows for the six months
ended June 30, 1996 and 1995. 5
Notes to Condensed Financial Statements. 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations. 7
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 2. Changes in Securities 11
Item 3. Default Upon Senior Securities 11
Item 4. Submission of Matters to a Vote of Security
Holders 11
Item 5. Other Information 11
Item 6. Exhibits and Reports on Form 8-K 11
Signatures 12
</TABLE>
2
<PAGE>
OneWave, Inc.
Condensed Balance Sheets
Part I. Financial Information
- -----------------------------
( In thousands )
Item 1. Financial Statements.
<TABLE>
<CAPTION>
Pro Forma
Audited Unaudited Unaudited
December 31, June 30, June 30,
1995 1996 1996
------------ --------- ---------
<S> <C> <C> <C>
Assets
Current Assets:
Cash and cash equivalents $ 105 $ 855 $ 42,395
Accounts receivable, net 1,909 2,807 2,807
Inventories 292 395 395
Prepaid expenses and other current assets 157 885 885
------------ --------- --------
Total current assets 2,463 4,942 46,482
Property and Equipment, net 163 2,425 2,425
------------ --------- --------
Total assets $ 2,626 $ 7,367 $ 48,907
============ ========= ========
Liabilities and Stockholders' Equity (Deficit)
Current Liabilities:
Accounts payable $ 576 $ 2,286 $ 2,286
Note payable to a bank - 2,000 -
Other current liabilities 3,576 3,583 3,583
Deferred revenue 278 386 386
------------ --------- --------
Total current liabilities 4,430 8,255 6,255
Notes Payable to Stockholders 1,000 - -
Redeemable Convertible Preferred Stock - 7,380 -
Stockholders' Equity (Deficit):
Preferred stock - 1,200 -
Common stock 11 10 15
Additional paid-in capital 1,231 6,404 58,519
Note receivable from executive officer - (2,560) (2,560)
Deferred compensation (167) (135) (135)
Accumulated deficit (3,879) (13,187) (13,187)
------------ --------- --------
Total stockholders' equity (deficit) (2,804) (8,268) 42,652
Total liabilities and stockholders' equity
(deficit) $ 2,626 $ 7,367 $ 48,907
============ ========= ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
OneWave, Inc.
Condensed Statements of Operations
(In thousands, except per share data)
<TABLE>
<CAPTION>
Unaudited Unaudited
Three Months Ended Six Months Ended
June 30, June 30,
-------------------------------------- ------------------------------------------
1995 1996 1995 1996
---------------- -------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Revenues:
Software license and maintenance $ - $ 2,217 $ 43 $ 2,927
Consulting and education services 598 935 971 2,606
--------------- -------------- ---------------- ----------------
Total revenues 598 3,152 1,014 5,533
Cost of Revenues:
Software license and maintenance - 321 22 610
Consulting and education services 407 844 579 1,818
--------------- -------------- ---------------- ----------------
Total cost of revenues 407 1,165 601 2,428
--------------- -------------- ---------------- ----------------
Gross profit 191 1,987 413 3,105
Operating Expenses:
Selling, general and administrative 313 2,421 650 4,122
Research and development 139 953 314 1,352
Compensation to executive officer - (612) - 6,903
--------------- -------------- ---------------- ----------------
Total operating expenses 452 2,762 964 12,377
--------------- -------------- ---------------- ----------------
Operating loss (261) (775) (551) (9,272)
Interest Expense, net (17) (18) (17) (36)
--------------- -------------- ---------------- ----------------
Net loss $ (278) $ (793) $ (568) $ (9,308)
=============== ============== ================ ================
Net Loss per Common and Common
Equivalent Share $ (0.02) $ (0.06) $ (0.05) $ (0.71)
=============== ============== ================ ================
Weighted Average Number of Common
and Common Equivalent Shares
Outstanding 13,141 13,141 12,585 13,141
=============== ============== ================ ================
</TABLE>
The accompanying notes are an integral part of these financial
statements.
4
<PAGE>
OneWave, Inc.
Condensed Statements of Cash Flow
(in thousands)
<TABLE>
<CAPTION>
Unadited
Six Months Ended
June 30,
--------------------------------
1995 1996
-------------- -------------
<S> <C> <C>
Cash Flows from Operating Activities:
Net loss $ (568) $ (9,308)
Adjustments to reconcile net loss to net cash used in
operating activities:
Compensation expense to executive officer - 6,903
Deferred compensation expense - 31
Depreciation and amortization of property and equipment 15 217
Change in operating assets and liabilities:
Trade and other receivables (464) (898)
Inventory - (103)
Prepaids and other current assets (2) (728)
Accounts payable (139) 1,710
Other current liabilities 131 (2,554)
Deferred revenue 81 108
------------ ------------
Net cash used in operating activities (946) (4,622)
Cash Flows from Investing Activities:
Purchases of property and equipment (35) (2,478)
------------ ------------
Net cash used in investing activities (35) (2,478)
Cash Flows from Financing Activities:
Proceeds from note payable to a bank - 2,000
Proceeds from ( payments on ) notes payable to stockholders 1,000 (1,000)
Proceeds from Issuance of redeemable convertible preferred stock - 6,780
Proceeds from Issuance of convertible preferred stock 5,970
Retirement of common stock - (6,000)
Proceeds from the exercise of employee stock options - 100
------------ ------------
Net cash provided by financing activities 1,000 7,850
Net Increase in Cash and Cash equivalents 19 750
Cash and Cash Equivalents, beginning of period - 105
------------ ------------
Cash and Cash Equivalents, end of period $ 19 $ 855
============ =============
Supplemental Disclosure of Cash Flow Information:
Cash paid during the period for interest $ - $ 84
============ ============
Supplemental Disclosure of Noncash Financing Activities:
Issuance of note receivable from executive officer $ - $ 2,560
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements
5
<PAGE>
OneWave, Inc.
Notes to Financial Statements
(Unaudited)
1. Basis of Presentation:
The condensed financial statements included herein are unaudited and reflect all
adjustments, consisting of normal recurring adjustments, which are, in the
opinion of management, necessary for a fair presentation of the results for the
interim periods. These financial statements should be read in conjunction with
the financial statements and notes thereto included in the Company's
Registration Statement on Form S-1 ( No. 333-04235) as filed with the Securities
and Exchange Commission.
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expenses during the reporting
period. Actual results could differ from those estimates and would impact future
results of operations and cash flows.
The results of operations for the reported 1996 periods are not necessarily
indicative of the results to be achieved for the entire year ending December 31,
1996.
2. Computation of Net Loss Per Common and Common Equivalent Share
Net loss per common share is computed based upon the weighted average number of
common shares and common equivalent shares outstanding. In accordance with the
Securities and Exchange Commission Staff Accounting Bulletin No. 83 ("SAB No.
83") all common and common equivalent shares and other potentially dilutive
instruments (including stock options, redeemable convertible preferred stock
and convertible preferred stock) issued during the twelve month period prior to
the public offering date have been included in the calculation as if they were
outstanding for all periods prior to the date of the Company's initial public
offering (IPO).
3. Subsequent Events
In July 1996, the Company completed its initial public offering of 3,750,000
shares of its common stock, of which 3,000,000 were sold by the Company and
750,000 were sold by certain of the Company's stockholders. The offering price
was $16.00 per share and the net proceeds were approximately $43,540,000, net of
underwriting discounts, commissions and other offering costs. Simultaneously,
all outstanding shares of preferred stock were automatically converted into
common stock. In July 1996, the Company used a portion of the proceeds for the
repayment of a $2,000,000 note payable to a bank.
4. Pro Forma Presentation
The unaudited pro forma balance sheet as of June 30, 1996 reflects the actual
balance sheet as of June 30, 1996 adjusted for the effects of, (i) net
proceeds of $43,540,000 from the issuance of 3,000,000 shares of common stock at
$16.00 per share from the IPO, (ii) the repayment of a $2,000,000 note payable
to a bank and (iii) the automatic conversion of all outstanding shares of
Series B redeemable convertible preferred stock and Series C convertible
preferred stock into an aggregate of 1,688,074 shares of common stock, upon the
completion of the IPO in July 1996.
6
<PAGE>
ITEM 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
The following information should be read in conjunction with the financial
statements and notes thereto and risk factors contained in the Company's Form S-
1 ( No. 333-04235) as filed with the Securities and Exchange Commission.
This Form 10-Q contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934. The Company's actual results could differ materially from those set
forth in the forward-looking statements. Factors that might cause such a
difference are discussed in the section entitled " Certain Factors that may
Affect Future Results" below.
OVERVIEW:
OneWave, Inc. ( "OneWave" or the "Company"), formerly Business@Web, Inc., is a
provider of "web-enabled" software for the development and deployment of
mission-critical business applications across an organization's disparate
information technology systems and the extension of those applications to
Intranets and the Internet.
RESULTS OF OPERATIONS:
Revenues:
- ---------
Total revenues increased $2,554,000 to $3,152,000 for the three months ended
June 30, 1996 from $598,000 for the comparable quarter in 1995. The increase was
due primarily to the introduction and expansion of the Company's product
offering, including the Openscape(TM) product line and consulting and education
services. For the three months ended June 30, 1996, software license and
maintenance revenues represented 70% of total revenues with the remaining 30%
from consulting and education services, compared with 100% from consulting and
education revenues for the comparable prior year period.
Total revenues increased $4,519,000 to $5,533,000 for the six months ended June
30, 1996 from $1,014,000 for the comparable period in 1995. The increase was due
primarily to the introduction and expansion of the Company's product offering,
including the Openscape(TM) product line and consulting and education services.
For the six months ended June 30, 1996, software license and maintenance
revenues represented 53% of total revenues with the remaining 47% from
consulting and education services compared with 4% and 96%, respectively for the
comparable prior year period.
Gross profit:
- -------------
Cost of software license and maintenance revenues consists of the cost of
software and maintenance purchased for resale from a related party, distribution
costs and product support costs. The cost of consulting and education services
consists primarily of consulting and education personnel salaries, related costs
and fees to third-party service providers. For the three months ended June 30,
1996, total gross profit increased to 63% of total revenue from 32% of total
revenues for the comparable prior year period. For the three months ended June
30, 1996, the gross profit percentage for license and maintenance revenues and
consulting and education services was 86% and 10% respectively. For the
comparable prior year quarter, no software license and maintenance revenues were
generated and the gross profit percentage for consulting and education services
was 32%. The increase in total gross profit percentage from the comparable
prior year quarter, is primarily attributable to the mix of revenues between
license and maintenance revenues and consulting and education services. The
decrease in gross profit percentage for consulting and education
7
<PAGE>
services from the comparable prior year quarter, is attributable to a greater
portion of services revenues generated by consulting services which has a lower
gross profit percentage than education services and an increase in consulting
and education personnel during the three months ended June 30, 1996.
For the six months ended June 30, 1996, total gross profit increased to 56% of
total revenue from 41% of total revenues for the comparable prior year period.
For the six months ended June 30, 1996, the gross profit percentage for license
and maintenance revenues and consulting and education services was 79% and 30%
respectively. For the comparable prior year six month period, the gross profit
percentage for license and maintenance revenues and consulting and education
services was 49% and 40% respectively. The increase in total gross profit
percentage from the comparable prior year quarter, is primarily attributable to
the mix of revenues between license and maintenance revenues and consulting and
education services. The increase in gross profit percentage for license and
maintenance revenues is attributable to a higher gross profit achieved on
revenues from Openscape(TM) products compared to prior year license and
maintenance revenues generated by reselling third party licenses and
maintenance. The decrease in gross profit percentage for consulting and
education services from the comparable prior year six month period, is
attributable to a greater portion of services revenues generated by consulting
services which has a lower gross profit percentage than education services and
an increase in consulting and education personnel during the six months ended
June 30, 1996.
Selling, General and Administrative Expenses:
- ---------------------------------------------
Selling, general and administrative expenses consist of payroll costs related to
executive management, finance, administration, sales and marketing personnel,
and costs for advertising, marketing and related administrative support.
Selling, general and administrative expenses increased to $2,421,000 for the
three months ended June 30, 1996 from $313,000 for the comparable prior year
period, representing 77% and 52% of total revenues, respectively. Selling,
general and administrative expenses increased to $4,122,000 for the six months
ended June 30, 1996 from $650,000 for the comparable prior year period,
representing 74% and 64% of total revenues, respectively. The total dollar
increase for the three and six month periods reflects the Company's increased
sales, marketing and distribution efforts through increased headcount and
related staffing expenditures as well as specific marketing and advertising
programs. The Company expects selling, general and administrative expenses to
continue to increase throughout 1996 and future periods.
Research and Development Expenses:
- ----------------------------------
Research and development expenses primarily consist of payroll-related costs,
fees to independent contractors and purchases of technology. To date, the
Company has expensed all software development costs as incurred. Research and
development expenses increased to $953,000 for the three months ended June 30,
1996 from $139,000 for the comparable prior year period, representing 30% and
23% of total revenues, respectively. Research and development expenses
increased to $1,352,000 for the six months ended June 30, 1996 from $314,000 for
the comparable prior year period, representing 24% and 31% of total revenues,
respectively. The total dollar increase for the three and six month periods is
attributable to increased headcount and related costs and the purchase of
technology rights during the second quarter of 1996. The increases reflect the
Company's efforts to enhance the functionality of its products. The Company
believes that it will be necessary to make continued significant expenditures on
research and development to remain competitive.
Compensation to Executive Officer:
- ----------------------------------
During the three months ended March 31, 1996, certain of the Company's
controlling stockholders sold 960,000 shares of common stock to the Chief
Executive Officer for an aggregate purchase price of $1,440,000, and agreed to
make certain payments to the Chief Executive Officer to secure his services as
the Company's Chief Executive Officer. In accordance with generally accepted
accounting principles, the
8
<PAGE>
Company recorded a non-cash expense of $7,515,000 related to these transactions.
This non-cash expense consists of: (i) $5,760,000, which represents the
difference between the purchase price paid by the Chief Executive Officer for
the shares of common stock that he purchased and the fair market value of those
shares at that time: (ii) $1,000,000, relating to a payment received by the
Chief Executive Officer from one of the Company's controlling stockholders: and
(iii) $755,000, representing the then current value of a payment guaranty that
such stockholder agreed to make to the Chief Executive Officer in the event of a
decline in the value of certain stock appreciation rights held by the Chief
Executive Officer on capital stock of his former employer. During the three
months ended June 30, 1996, the value of the guaranty declined due to an
increase in the value of the stock appreciation rights and accordingly the
Company recorded a favorable credit of $612,000. In the event of fluctuations in
the value of these stock appreciation rights, the Company may record additional
non-cash credits or charges through September 30, 1996.
Interest Expense, Net:
- ----------------------
For the three and six months ended June 30, 1996 the Company recorded interest
expense, net of $18,000 and $36,000, respectively. The expense is comprised of
interest on the Company's $1,000,000 notes payable to stockholders and
$2,000,000 under its note payable to a bank, offset by interest income of
$17,000 and $48,000 respectively on the Company's cash and cash equivalents.
The Company repaid in full the notes payable to stockholders and secured term
note with a bank in March 1996 and July 1996, respectively.
Liquidity and Capital Resources:
- --------------------------------
In July 1996, the Company completed its initial public offering of 3,750,000
shares of its common stock of which 3,000,000 shares were sold by the Company
and 750,000 shares were sold by certain of the Company's stockholders. The
public offering price was $16.00 per share and the net proceeds to the Company
were approximately $43,540,000, net of underwriting discounts, commissions and
other offering costs. Upon consummation of the IPO, all outstanding shares of
preferred stock were automatically converted into common stock. The Company
used a portion of the proceeds for the repayment of a $2,000,000 note payable
to a bank.
In February 1996, the Company entered into a financing agreement with a bank.
The agreement provides for a revolving line of credit of up to $2,500,000,
subject to certain limitations, and an equipment line of credit up to $500,000
for purchases of new equipment. As of June 30, 1996, the Company had no
outstanding balances under the revolving line of credit or the equipment line of
credit.
The Company's operating activities utilized cash and cash equivalents of
approximately $4,622,000 for the six month period ending June 30, 1996.
The Company's investing activities, which consisted of purchases of property and
equipment associated with the increases in headcount and the move to a new
facility in March 1996, utilized cash and cash equivalents of approximately
$2,478,000 for the six month period ending June 30, 1996.
The Company's financing activities provided cash and cash equivalents of
approximately $7,850,000 for the six month period ending June 30, 1996,
primarily from private issuance of equity securities and borrowings under its
notes payable with a bank. The proceeds generated from the issuance of
convertible preferred stock were used to retire common stock. The borrowings
under its note payable with a bank were repaid in full in July 1996.
The Company has agreed to loan an executive officer up to $2,560,000 for
payment of his anticipated income tax liability resulting from his purchase of
960,000 shares of the Company's common stock from a significant stockholder for
a purchase price less than its then fair market value. The Company believes
that
9
<PAGE>
it will fund the amounts under the loan agreement in the first quarter of 1997.
The Company has no other significant commitments other than obligations under
its operating leases.
The Company currently anticipates that the net proceeds of the IPO, existing
cash balances and borrowings under the Company's bank agreement will be
sufficient to meet its anticipated working capital and capital expenditure
requirements for the next 18 months. Thereafter, the Company may need to raise
additional funds. The Company may need to raise additional funds sooner in
order to fund more rapid expansion, to develop new or enhanced products or
services, to respond to competitive pressures or to acquire complementary
businesses or technologies. There can be no assurance that additional
financing will be available when needed on terms favorable to the Company or at
all. If adequate funds are not available or not available on acceptable terms,
the Company may be unable to develop or enhance products or services, take
advantage of future opportunities, or respond to competitive pressures, which
could have a material adverse effect on the Company's business, financial
condition or operating results.
CERTAIN FACTORS THAT MAY AFFECT FUTURE RESULTS
This Form 10-Q contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934. The Company's actual results could differ materially from those set
forth in the forward-looking statements. Certain factors that might cause such
a difference include limited operating history, potential fluctuations in
quarterly results, recent introduction of Openscape(TM) products; new releases,
developing market; unproven acceptance of the Company's products, dependence on
the Internet, competition, new product development, risk of software defects,
reliance on strategic relationships, management of growth, dependence on key
personnel, evolving distribution strategy, proprietary technology; intellectual
property, dependence on third-party technology, product liability and risks
associated with global operations which are discussed in the section entitled
" Risk Factors " on page 5 of the Company's prospectus dated July 2, 1996
contained in the Company's registration statement on Form S-1 ( No. 333-04325).
Upon request, the Company will provide a copy of the prospectus without charge.
10
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Default 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) Exhibit 11
Statement regarding computation of earnings per share
(b) Reports on Form 8 K
None
(c) Exhibit 27
Financial Data Schedule
11
<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, thereto duly authorized.
Dated: August 12, 1996
OneWave, Inc.
(Registrant)
/S/ Klaus P. Besier
---------------------
Klaus P. Besier
Chairman and Chief Executive Officer
/S/ Mark J. Gallagher
----------------------
Mark J. Gallagher
Principal Financial Officer
12
<PAGE>
OneWave, Inc.
Statement Regarding Computation of Net Loss Per Share
(In thousands, except per share data)
Exhibit 11
<TABLE>
<CAPTION>
UNAUDITED UNAUDITED
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
---------------------------- -------------------------
1995 1996 1995 1996
------------ ----------- ----------- ----------
<S> <C> <C> <C> <C>
Net loss $ 278 $ 793 $ 568 $ 9,308
Weighted average shares outstanding
during the period (1) 10,737 10,737 10,181 10,737
Common stock equivalent shares (1) 2,404 2,404 2,404 2,404
------------ ----------- ----------- ----------
Weighted average number of common and
common stock equivalents 13,141 13,141 12,585 13,141
Net loss per common and common equivalent share $ (0.02) $ (0.06) $ (0.05) $ f (0.71)
============ =========== =========== ==========
</TABLE>
(1) In accordance with the Securities and Exchange Commission Staff Accounting
Bulletin No. 83 ("SAB 83") all common and common equivalent shares and
other potentially dilutive instruments (including stock options,
redeemable convertible preferred stock and convertible preferred stock)
issued during the last twelve month period prior to the public offering
date have been included in the calculation as if they were outstanding for
all periods prior to the date of the IPO.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED FINANCIALS IN COMPANY'S 6/30/96 10-Q AND IS QUALIFIED IN ITS ENTIRETY
BYU REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 6-MOS
<FISCAL-YEAR-END> DEC-31-1996 DEC-31-1996
<PERIOD-START> APR-01-1996 JAN-01-1996
<PERIOD-END> JUN-30-1996 JUN-30-1996
<CASH> 855 855
<SECURITIES> 0 0
<RECEIVABLES> 2,967 2,967
<ALLOWANCES> 160 160
<INVENTORY> 395 395
<CURRENT-ASSETS> 4,942 4,942
<PP&E> 2,705 2,705
<DEPRECIATION> 280 280
<TOTAL-ASSETS> 7,367 7,367
<CURRENT-LIABILITIES> 8,255 8,255
<BONDS> 7,380 7,380
0 0
1,200 1,200
<COMMON> 10 10
<OTHER-SE> (9,478) (9,478)
<TOTAL-LIABILITY-AND-EQUITY> 7,367 7,367
<SALES> 3,152 5,533
<TOTAL-REVENUES> 3,152 5,533
<CGS> 1,165 2,428
<TOTAL-COSTS> 1,165 2,428
<OTHER-EXPENSES> 2,762 12,377
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 18 36
<INCOME-PRETAX> (793) (9,308)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> (793) (9,308)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (793) (9,308)
<EPS-PRIMARY> (0.06) (0.71)
<EPS-DILUTED> (0.06) (0.71)
</TABLE>
