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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
OCTOBER 27, 1999
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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CELLNET FUNDING, LLC
(Exact name of registrant as specified in its charter)
DELAWARE COMMISSION FILE NUMBER: 94-3298620
(State or other jurisdiction of 000-21409 (I.R.S. Employer
incorporation or organization) Identification Number)
125 SHOREWAY ROAD
SAN CARLOS, CALIFORNIA 94070
(Address of principal executive offices, including zip code)
(650) 508-6000
(Registrant's Telephone Number, Including Area Code)
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ITEM 5. OTHER EVENTS
CellNet Data Systems, Inc., the parent company of the Registrant, issued
the following press release today
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c). EXHIBITS.
99.1 Press Release dated October 27, 1999.
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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
Cellnet Funding, L.L.C.
(Registrant)
by CellNet Data Systems, Inc., Manager
by David L. Perry
Vice President and Secretary
Date: October 27, 1999
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CELLNET DATA SYSTEMS REPORTS ON STATUS OF EFFORTS TO RAISE
ADDITIONAL CAPITAL
SAN CARLOS, Calif., October 27, 1999 -- CellNet Data Systems, Inc. (NASDAQ:
CNDS) a market-leading provider of telemetry services, announced that it has
been unsuccessful so far in its efforts to raise additional capital necessary to
fund the continued growth and operation of its business.
CellNet indicated that the efforts are ongoing and it expects to be successful
ultimately in attracting the long-term investment needed to maintain its rapid
growth rate.
"The difficulties we are encountering reflect, to some extent, current attitudes
in the financial markets toward companies with significant capital requirements
in their business models," said John T. LaMacchia, CellNet president & chief
executive officer. "I am pleased that many of the prospective investors we have
contacted find the fundamentals of our business attractive and believe, as we
do, that we are well-positioned to take advantage of the changing utility market
environment." However, he added, "We are also hearing from our investment
bankers that potential investors are reluctant to invest in CellNet given the
amount of debt and 7% Exchangeable Preferred Securities (NASDAQ: CNDSP) on its
balance sheet and the restrictive terms of those instruments. It is becoming
evident that restructuring our balance sheet is likely to be necessary to
attract long-term capital."
CellNet is reviewing the options available to it to implement a balance sheet
restructuring. "In fairness to the holders of our common shares and 7%
Exchangeable Preferred Securities, I must point out that, in such a
restructuring, their equity stake in the Company may be adversely affected," Mr.
LaMacchia said.
CellNet has retained The Blackstone Group and Simpson Thacher & Bartlett as
financial and legal advisors for restructuring matters. Certain holders of
CellNet's 14% Senior Discount Notes due 2007, representing a substantial
majority of total holdings, have organized an informal committee to negotiate
with CellNet with respect to its restructuring. These noteholders have expressed
a willingness to consider funding CellNet's immediate short-term cash needs
while it completes the process of soliciting potential investors and
restructuring its balance sheet, although no formal commitments have been
provided.
THE COMPANY
CellNet Data Systems, Inc. is an industry pioneer and leading provider of
low-cost "telemetry services" - defined as the ability to transmit and receive
data for the remote monitoring and control of devices. CellNet networks are the
largest and fastest-growing of their kind in the world, providing connectivity
for millions of devices in the energy industry and other Commercial Data Service
markets. For more Company information visit http://www.cellnet.com.
CERTAIN STATEMENTS CONTAINED IN THIS NEWS RELEASE ARE FORWARD-LOOKING
STATEMENTS, INCLUDING, WITHOUT LIMITATION, STATEMENTS RELATING TO: CONTINUED
GROWTH, ATTITUDES IN THE FINANCIAL MARKETPLACE, ATTITUDES OF PROSPECTIVE
INVESTORS, AND THE ABILITY OF CELLNET TO TAKE
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ADVANTAGE OF THE CHANGING UTILITY MARKET ENVIRONMENT; EXPECTATIONS WITH RESPECT
TO CELLNET'S ABILITY TO OBTAIN SUFFICIENT LONG-TERM CAPITAL TO MEET ITS
REQUIREMENTS, EITHER WITH OR WITHOUT A RESTRUCTURING OF ITS BALANCE SHEET; THE
POSSIBLE EFFECT OF A RESTRUCTURING ON THE VALUE OF ANY COMMON STOCK OF CELLNET
AND/OR 7% EXCHANGEABLE PREFERRED SECURITIES OF CELLNET FUNDING, L.L.C.; AND THE
WILLINGNESS OF THE HOLDERS OF CELLNET'S 14% SENIOR DISCOUNT NOTES TO
PARTICIPATE IN THE DEVELOPMENT OF A RESTRUCTURING PLAN AND/OR TO CONSIDER
FUNDING CELLNET'S IMMEDIATE SHORT-TERM CASH NEEDS. THESE STATEMENTS THEREFORE
ARE MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995. ACTUAL RESULTS MAY DIFFER FROM THESE STATEMENTS
AND SUCH DIFFERENCES MAY BE MATERIAL. IN SHORT, NO ASSURANCE CAN BE GIVEN THAT
CELLNET WILL BE ABLE TO RAISE THE ADDITIONAL SHORT-TERM AND/OR LONG-TERM
CAPITAL NECESSARY TO MEET ITS REQUIREMENTS. INVESTORS ARE ENCOURAGED TO REVIEW
CELLNET'S MOST RECENT FORM 10-K AND FORM 10-Q FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION FOR A DISCUSSION OF THESE AND ADDITIONAL FACTORS THAT COULD
AFFECT CELLNET'S FUTURE PERFORMANCE.
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For more information, contact: Alex Tsigdinos (650) 508-6976
