EXHIBIT INDEX APPEARS ON PAGE
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended March 31, 1999
Commission File Number: 0-17170
TELVUE CORPORATION
(Exact name of small business issuer as specified in its charter)
DELAWARE 51-0299879
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
16000 Horizon Way, Suite 500
Mt. Laurel, New Jersey 08054
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code:(609) 273-8888
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or
for such shorter period that the issuer was required to file such reports)
and (2) has been subject to such filing requirements for the past 90 days.
Yes X No
------ ------
Number of shares of registrant's common stock outstanding as of April 19,
1999: 24,194,500 shares.
Transitional Small Business Disclosure Form: Yes No X
------ ------
This report includes a total of 15 pages.
TELVUE CORPORATION
INDEX
PAGE
NO.
-----
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets as of March 31, 1999
(unaudited) and as of December 31, 1998
Statements of Operations for the three
months ended March 31, 1999 (unaudited)
and March 31, 1998 (unaudited)
Statements of Cash Flows for the three
months ended March 31, 1999 (unaudited)
and March 31, 1998 (unaudited)
Notes to Financial Statements (unaudited)
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
<PAGE>
<TABLE>
PART I. Financial Information
ITEM I. Financial Statements
TELVUE CORPORATION
BALANCE SHEETS
March 31, December 31,
1999 1998
------------- -----------
<S> <C> <C>
ASSETS (Unaudited) *
CURRENT ASSETS
Cash and cash equivalents $ 300,520 $ 453,569
Accounts receivable - trade 863,851 786,083
Other receivables 6,075 4,910
Prepaid income taxes 6,339 -
Deferred tax asset 285,935 285,935
Other current assets 39,892 11,626
----------- ----------
TOTAL CURRENT ASSETS 1,502,612 1,542,123
PROPERTY AND EQUIPMENT
Machinery and equipment 4,810,579 4,791,240
Less accumulated depreciation 3,669,887 3,462,823
----------- ----------
1,140,692 1,328,417
DEFERRED TAXES, net 1,823,971 1,932,778
SECURITY DEPOSITS 9,300 9,300
----------- ----------
$4,476,575 $4,812,618
=========== ==========
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Notes payable-majority stockholder-current $ 1,416,000 $ 1,380,000
Accounts payable - trade 312,074 512,047
Accrued expenses 173,585 172,839
Accrued dividends 527,805 422,244
Income taxes payable - 8,661
----------- ----------
TOTAL CURRENT LIABILITIES 2,429,464 2,495,791
NOTES PAYABLE - MAJORITY STOCKHOLDER 785,050 1,039,712
ACCRUED INTEREST - MAJORITY STOCKHOLDER 2,564,424 2,694,837
REDEEMABLE CONVERTIBLE PREFERRED STOCK, $1 par
value, 6,900,000 shares authorized,
3,518,694 shares issued and outstanding 3,518,694 3,518,694
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' DEFICIT
Common stock, $.01 par value, 100,000,000
shares authorized, 24,194,500 shares issued
and outstanding 241,945 241,945
Additional paid-in capital 1,550,535 1,550,535
Accumulated deficit (6,613,537) (6,728,896)
----------- -----------
(4,821,057) (4,936,416)
----------- -----------
$4,476,575 $ 4,812,618
=========== ===========
* Derived from audited financial statements.
The accompanying unaudited notes are an integral part of these statements.
<PAGE>
TELVUE CORPORATION
STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended
March 31,
----------------------------
1999 1998
---- ----
REVENUES $ 1,586,056 $ 1,601,353
OPERATING EXPENSES
Service 623,689 754,015
Selling and marketing 161,214 169,781
General and administrative 163,333 160,654
Depreciation 207,064 216,841
----------- -----------
1,155,300 1,301,291
----------- -----------
OPERATING INCOME 430,756 300,062
OTHER INCOME (EXPENSE)
Interest income 4,896 7,176
Interest expense (100,925) (140,204)
----------- -----------
(96,029) (133,028)
----------- -----------
INCOME BEFORE INCOME TAXES 334,727 167,034
INCOME TAX (113,807) (74,000)
------------ ----------
NET INCOME 220,920 93,034
DIVIDENDS ON REDEEMABLE
CONVERTIBLE PREFERRED STOCK (105,561) (105,561)
----------- ------------
NET INCOME (LOSS) AVAILABLE TO
COMMON STOCKHOLDERS $ 115,359 $ (12,527)
=========== ============
NET INCOME (LOSS) PER COMMON SHARE
BASIC $.01 ($.00)
============ ===========
DILUTED $.00 ($.00)
============ ===========
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING
BASIC 24,194,500 23,814,500
========== ==========
DILUTED 82,043,370 -
========== ==========
The accompanying unaudited notes are an integral part of these statements.
<PAGE>
TELVUE CORPORATION
STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three months Ended
March 31,
---------------------
1999 1998
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ 220,920 $ 93,034
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation 207,064 216,841
Deferred taxes 108,807 74,000
Changes in assets and liabilities:
Decrease (increase) in -
Accounts receivable - trade (77,768) (22,701)
Other receivables (1,165) 578
Prepaid income taxes (6,339) (13,000)
Other current assets (28,266) (18,348)
Security deposits - -
Increase (decrease) in -
Accounts payable (199,973) (40,704)
Accrued expenses 746 7,417
Income taxes payable (8,661) (12,000)
Deferred trunk credit - (31,650)
Accrued interest - majority stockholder (130,413) 140,204
----------- -----------
NET CASH PROVIDED BY OPERATING
ACTIVITIES 84,952 393,671
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment (19,339) (86,833)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Debt reduction:
Notes payable - majority stockholder (218,662) (550,000)
----------- ----------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (153,049) (243,162)
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD 453,569 445,368
---------- ----------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 300,520 $ 202,206
========== ==========
The accompanying unaudited notes are an integral part of these statements.
<PAGE>
TELVUE CORPORATION
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF PRESENTATION:
----------------------
Summary Financial Information and Results of Operations
- --------------------------------------------------------
In the opinion of management, the accompanying unaudited financial
statements have been prepared in conformance with generally accepted
accounting principles and with the regulations of the Securities and
Exchange Commission and contain all adjustments (consisting of only normal
recurring adjustments) necessary to make the financial statements not
misleading and to present fairly the financial condition as of March 31,
1999, the results of operations for the three months ended March 31, 1999
and 1998 and cash flows for the three months ended March 31, 1999 and 1998.
Interim Financial Information
- -----------------------------
While management believes that the disclosures presented are adequate to
prevent misleading information, these unaudited financial statements must be
read in conjunction with the audited financial statements and notes included
in the Company's Form 10-KSB report for the year ended December 31, 1998, as
filed with the Securities and Exchange Commission.
Prior period financial statements have been reclassified to conform with
current quarter presentation.
2. SUPPLEMENTAL CASH FLOW INFORMATION:
-----------------------------------
Supplemental disclosures of cash paid during the period-
1999 1998
---- ----
Income taxes $ 20,000 $25,000
Interest $231,338 $ 0
Non-cash Investing and Financing Transactions
- ---------------------------------------------
The Company accrued dividends on its redeemable convertible preferred stock
of 105,561 for each of the three months ended March 31, 1999 and 1998.
During the three months ended March 31, 1999 and 1998, no shares of
preferred stock were issued in payment of preferred stock dividends.
3. EARNINGS (LOSS) PER COMMON SHARE:
--------------------------------
Earnings (loss) per common share amounts are based upon the weighted average
number of common and common equivalent shares outstanding during the year.
Common equivalent shares are excluded from the computation in periods in
which they have an antidilutive effect.
In February 1997, the Financial Accounting Standards Board issued SFAS 128
Earnings per Share ("SFAS 128"), which specifies the computation,
presentation, and disclosure requirements for earnings per share ("EPS").
It replaces the presentation of primary and fully diluted EPS with basic and
diluted EPS. Basic EPS excludes all dilution. It is based upon the
weighted average number of common shares outstanding during the period.
Diluted EPS reflects the potential dilution that would occur if securities
or other contracts to issue common stock were exercised or converted into
common stock.
The following is reconciliation from basic earnings per share to diluted
earnings per share for the three months ended March 31, 1999. Because of
the net loss available to common stockholders for the three months ended
March 31, 1998, no potential common shares are included in the computation
of a diluted per share amount since such potential common shares would not
have a dilutive effect.
Net Income
(Loss)
Available Average
to Common Shares Earnings
Stockholders Outstanding Per Share
------------ ----------- --------
1999 $ 115,359 24,194,500 $ .01
Effect of dilution
Warrants 29,915,160
Convertible preferred stock 105,561 26,978,009
Convertible accrued interest - 955,701
----------- ---------- --------
Diluted $ 220,920 82,043,370 $ .00
=========== ========== ========
1998 $ (12,527) 23,814,500 $ .00
=========== ========== ========
4. DIVIDENDS ON REDEEMABLE CONVERTIBLE PREFERRED STOCK:
----------------------------------------------------
As of March 31, 1999, undeclared dividends on outstanding preferred stock
amounted to $527,805.
5. CORPORATE INCOME TAXES:
-----------------------
The Company uses the asset and liability method of accounting for income
taxes in accordance with Financial Accounting Standards Board Statement
(SFAS) No. 109, "Accounting for Income Taxes". SFAS 109 requires
recognition of deferred tax assets and liabilities for the expected future
tax consequences of events that have been recognized in the financial
statements or tax returns. Under this method, deferred tax liabilities and
assets are determined based on the differences between the financial
statement carrying amounts and tax bases of assets and liabilities using
enacted tax rates in effect in the years in which the differences are
expected to reverse. Differences between financial reporting and tax bases
arise most frequently from differences in timing of income and expense
recognition. Deferred income tax expense is measured by the change in the
net deferred income tax asset or liability during the year.
The provisions for income tax benefit (expense) consist of the following
components:
1999 1998
----------- ----------
Current
Federal $ (5,000) $ -
State - -
----------- ----------
(5,000) -
Deferred
Federal (108,807) (59,000)
State - (15,000)
---------- ----------
$(113,807) $ (74,000)
========== ==========
The Company has a net operating loss carryforward of approximately
$3,200,000 on a tax reporting basis. The carryforward will begin to expire
in 2004, if not utilized.
Differences between the effective income tax rate and the statutory federal
income tax rate were primarily the result of the change in the valuation
allowance.
6. NOTES PAYABLE AND ACCRUED INTEREST - MAJORITY STOCKHOLDER:
----------------------------------------------------------
As of March 31, 1999, the Company had various outstanding notes due to the
majority stockholder in the aggregate principal amount of $2,201,050 and
accrued interest due on these notes in the aggregate amount of $2,564,424.
Effective as of March 31, 1999, the Company obtained from the majority
stockholder an extension to January 1, 2001, of his prior agreement not to
demand repayment of his loans or the accrued interest on the loans. The
Company has decided to voluntarily make, and the majority stockholder has
agreed to accept, monthly payments in the amount of $150,000 through
December 31, 1999. Effective January 1, 1999, the Company began to make
current interest payments from the $150,000 monthly payment. The balance of
the payment is applied to loan principal. The Company may make monthly
payments in excess of $150,000 when, in the opinion of management, the
Company has excess cash that is not needed to fund operations. The Company
made payments of $450,000 during the three months ended March 31, 1999. The
Company has classified twelve estimated principal payments of $118,000 each
as a current liability on the balance sheet.
7. COMMITMENTS AND CONTINGENCIES
-----------------------------
The Company has received notice from a cable operating company customer
asserting its right to be indemnified against claims of patent infringement
made to the cable operator by a third party. The third party has alleged
to the cable operator that portions of the cable operator's pay-per-view
operations infringe one or more patents held by such party. No notice of
alleged infringement has been received by the Company from such third
party. The Company has retained independent patent counsel to review the
terms and the alleged infringement. The Company is unable at this time to
determine the amount or extent of liability, if any, to the cable operator.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
TelVue Corporation (the "Company") is a marketing and service company
primarily selling automatic number identification ("ANI") telecommunications
services to the cable television industry for the automated ordering of
pay-per-view features and events (the "Service"). The Company provides the
Service through equipment it purchases. The Company's equipment for
providing the Service nationwide is located at the Company's home office in
Mt. Laurel, New Jersey. The equipment provides enhanced service features.
These enhanced service features, which identify the cable operator by name
("Custom Greeting") and, on accepted orders, speaks the movie or event
title, start-time and channel appearance ("Title Speak"), are necessary,
the Company believes, for it to remain competitive within the pay-per-view
ANI industry. The equipment also speaks promotional messages for products
and services at the time a cable subscriber is placing an order for a pay-
per-view movie or event (the "PPV+ service"). The Company serves cable
television systems across the United States via trunk lines and data
circuits that it currently leases from MCIWorldcom. The Company believes it
receives a favorable trunk usage rate from MCIWorldcom.
Income before income taxes was $334,727 for the quarter ended March
31, 1999, compared $167,034 for the quarter ended March 31, 1998. The
Company experienced a decrease in the average monthly buy rate from 19.5%
for the quarter ended March 31, 1998, to 15.5% for the quarter ended March
31, 1999. The drop in the buy rate caused the pay-per-view buy revenue to
decrease approximately $73,000. The Company believes a somewhat weak movie
product is one of the reasons for the decrease in the buy rates for the
quarter ended March 31, 1999. Although the pay-per-view buy revenue
decreased, the Company had an increase in feature revenue of $77,897 as a
result of the Company serving approximately 1,800,000 more full-time
subscribers at March 31, 1999, when compared to March 31, 1998. PPV+
service revenue decreased $43,712 for the quarter ended March 31, 1999,
because included in the 1998 PPV+ revenue was $41,435 of club promotion
revenue. The club promotion revenue was written off as uncollectable in
September 1998. No club promotion revenue was generated or recorded during
the first quarter of 1999.
The Company had net income of $220,920 for the quarter ended March 31,
1999, compared to $93,034 for the quarter ended March 31, 1998. Included in
net income is income tax of $113,807 for the quarter ended March 31, 1999,
compared to $74,000 for the quarter ended March 31, 1998. As of March 31,
1999, the Company's net operating loss carryforward is approximately
$3,200,000 on a tax reporting basis (see Note 5 to the Company's financial
statements).
Service expenses decreased $130,326 for the quarter ended March 31,
1999. This is a result of a decrease in trunk expense due to the buy rate
decrease (see above) and a reduction in the telephone rates charged by
MCIWorldcom.
As of March 31, 1999, the Company was serving approximately 11,600,000
full-time cable subscribers and 1,253,000 part-time subscribers, compared to
approximately 9,800,000 full-time cable subscribers and 1,300,000 part-time
subscribers served as of March 31, 1998. The part-time subscribers did not
significantly contribute to the revenue or service expenses for the quarters
ended March 31, 1999 and 1998. However, during the quarter ended March 31,
1999, 58,000 part-time subscribers converted to using the Company's service
on a full-time basis.
The Company's operations had required a substantial purchase of
equipment by the Company. During the quarter ended March 31, 1999, the
Company purchased $19,339 of equipment compared to $86,833 purchased during
the quarter ended March 31, 1998. Depreciation accounted for 18% of total
operating expenses for the quarter ended March 31, 1999, compared to 17% for
the quarter ended March 31, 1998. For the quarter ended March 31, 1999,
selling and marketing expenses decreased 5% as a result of a decrease in
advertising expense and cable show expense. General and administrative
expenses increased approximately 2% due to small increases in various
expense categories.
Total liabilities decreased $451,402 and total assets decreased
$336,043 for the quarter ended March 31, 1999. The decrease in total
liabilities was partially as result of a decrease in accounts payable of
$199,973. The accounts payable at December 31, 1998, was higher than usual
as a result of an $84,000 equipment purchase and DS3 trunk invoices of
approximately $100,000 that were on hold due to incorrect billing. There
was also a decrease in notes payable - majority stockholder of $218,662 and
a decrease in accrued interest - majority stockholder of $130,413 due to
debt repayment. Partially offsetting the above decreases is an increase in
accrued dividends on preferred stock of $105,561. The decrease in assets is
partially attributable to a decrease in deferred tax asset of $108,807 (see
above and Note 5 to the financial statements), and an increase in
accumulated depreciation of $207,064. The Company's days for sales in
accounts receivable is 47 days for the quarter ended March 31, 1999,
compared to 52 days for the quarter ended March 31, 1998. The Company does
not offer incentives/discounts to its customers, nor has it changed its
credit terms with its customers.
The Company had positive cash flow from operations of $84,952 for the
quarter ended March 31, 1999 compared to $393,671 for the quarter ended
March 31, 1998. Ignoring changes in operating assets and liabilities that
result from timing issues, and considering only adjustments to reconcile net
income to net cash provided by operating activities, the Company would have
positive cash flow from operating activities of $536,791 for the quarter
ended March 31, 1999, compared to positive cash flow from operating
activities of $383,875 for the quarter ended March 31, 1998. Cash flow for
the quarter ended March 31, 1999, increased mainly as a result of a
reduction in trunk expense due to a decrease in the MCI rates during the
first quarter of 1999 (see above).
Since November 2, 1989, the Company has funded its expansion and
operating deficit from the $2,500,000 of proceeds from the sale of shares of
the Company's Common Stock and Preferred Stock to Mr. Lenfest and from
borrowings from Mr. Lenfest. From November 1989 to February 1996, the
Company borrowed an aggregate of $6,128,712 from Mr. Lenfest. The interest
rates on the loans range from a floating rate based on the prime rate of PNC
Bank to a fixed rate of 12%. Interest on one of the loans in the principal
amount of $1,471,272 as of March 31, 1999, is payable quarterly and, at the
option of the Company may be paid by the delivery of shares of the Company's
Preferred Stock at the rate of one share of Preferred Stock for each one
dollar of accrued interest. Interest due on this loan prior to 1998, in the
amount of $473,682 has been paid with 473,682 shares of Preferred Stock. No
Preferred Stock has been issued for 1998 or 1999 accrued interest. In
addition, during January 1995, Mr. Lenfest purchased from Science Dynamics
Corporation (the Company's former parent company) the Company's non-interest
bearing note in the amount of $541,000.
The Company remains dependent upon the deferral of a lump sum repayment
of principal and interest due to Mr. Lenfest, to fund operations and capital
expenditures from operating cash flow. Effective as of March 31, 1999, the
Company obtained from Mr. Lenfest a written agreement stating he will not
demand repayment of his loans or the cash payment of accrued interest on the
loans through January 1, 2001. Nevertheless, the Company intends to
continue to voluntarily make monthly payments of $150,000 to Mr. Lenfest. On
January 1, 1999, the Company began to pay current monthly interest payments
to Mr. Lenfest from the $150,000 monthly payment. The balance of the
payment is applied to loan principal. During the first quarter of 1999, the
Company made total payments of $450,000 to Mr. Lenfest. Management believes
that the Company will have sufficient funds to continue such repayments and
will be able to fund its core business from operating cash flow through
December 31, 1999. The aggregate outstanding loan balance due to Mr.
Lenfest as of March 31, 1999, is $2,201,050 in loan principal and $2,564,424
in accrued interest.
The Company's ability to fund its operating expenses primarily depends
on three factors: the continued expansion of the Company's subscriber base,
the cable industry's buy rates, and the continued deferral by Mr. Lenfest of
a lump sum cash repayment of his loans to the Company. Management believes
its present marketing strategies will further increase the customer base,
although there can be no assurances that the Company will be able to attract
any further customers or that it will retain its current customers. In
addition, revenues are affected by the "buy rates" of subscribers connected
to the Service. The Company has no control over the buy rates. As noted
above, the Company experienced a decrease in the average monthly buy rate
from 19.5% for the quarter ended March 31, 1998, to 15.5% for the quarter
ended March 31, 1999. Hence, there can be no assurance that buys rates will
increase or will remain at their current level.
The Company's software for its pay-per-view ANI ordering is "Year
2000 Compliant". The Company's long distance telecommunications provider,
MCIWorldcom, has informed the Company that they have implemented a
Strategic Year 2000 Compliance Plan in which appropriate remedial action to
non-compliant elements is being performed. Many telecommunications
providers use the same switch suppliers. Telecommunications companies,
including MCIWorldcom, will not be able to declare their systems compliant
until these switch manufacturers have completed their compliance programs.
MCIWorldcom is targeting all systems to be compliant by the second quarter
1999 to allow full testing and monitoring. Interconnect agreements formed
with other telecommunications companies mean that some of MCIWorldcom's
services are dependent on third party carriers. All the major
telecommunications companies, including MCIWorldcom, rely to some extent on
interconnect agreements with third parties and need to validate the
compliance of these third parties. In the event that MCIWorldcom is not
Year 2000 compliant, there exists the possibility that the Company would
not be able to receive telephone calls from the cable operator subscribers,
and therefore, could not process any orders. If MCIWorldcom does not
become fully Year 2000 compliant during 1999, the Company will switch to
another long distance telephone service provider who is Year 2000
compliant. As a result of such switch the Company would incur duplicate
facility and data link costs for a few months due to temporarily having
redundant facilities in service.
The Company has also requested Year 2000 compliance certificates from
the cable operator billing vendors to whom the Company transmits the pay-
per-view ordering data. In the event that the billing vendors do not
become Year 2000 compliant, the Company would not be able to transfer
information regarding pay-per-view orders, and therefore, no pay-per-view
orders could be fulfilled. To date, the billing vendors have indicated
they are working on being Year 2000 compliant. The Company has verified,
through testing, that two billing vendors are Year 2000 compliant with
regard to processing the pay-per-view ordering information transmitted by
the Company. The Company plans to test the remaining billing vendors
during the second quarter of 1999. The Company's contingency plan would be
determined by the cable operator's decision with respect to selecting a
different billing vendor.
A majority of the Company's software that it uses for administrative
purposes is Year 2000 compliant. The software that creates the customer
invoices is not presently Year 2000 compliant. The vendor of such software
has made available software to upgrade to Year 2000 compliancy. The
Company is currently working on upgrading the software. In the unlikely
event that such software does not get upgraded, the Company would have to
create its invoices in another software program that would be time
consuming and involve some manual effort.
The Company has performed its Year 2000 compliance checks internally
and therefore has not incurred any related costs. The Company expects the
fees to be nominal for converting its administrative software to be Year
2000 compliant.
PART II. OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
3.1 Certificate of Incorporation of the Company (incorporated by
reference to the Company's Registration Statement on Form S-8, dated
March 30, 1989 (the "Registration Statement")).
3.2 Bylaws of the Company (incorporated by reference to the Company's
Registration Statement).
3.3 Certificate of Amendment of Certificate of Incorporation of the
Company, dated April 11, 1990 (incorporated by reference to the
Company's Annual Report on Form 10-K for the year ended December 31,
1991, (the "1991 Form 10-K")).
3.4 Certificate of Amendment of Certificate of Incorporation of the
Company, dated March 15, 1991 (incorporated by reference to the 1991
Form 10-K).
3.5 Form of copy of Amendment of Certificate of Incorporation of the
Company, filed September 25, 1995 (incorporated by reference to the
Company's Form 10-QSB for the period ended September 30, 1995, (the
September 30, 1995 Form 10-QSB)).
4.1 Incentive Stock Option Plan (incorporated by reference to the
Company's Registration Statement).
4.2 Form of Stock Option Agreement (incorporated by reference to the
Company's Annual Report on Form 10-K for the year ended December 31,
1989, (the "1989 Form 10-K")).
4.3 Warrant Agreement, dated March 15, 1991, between the Company and
H.F. Lenfest (incorporated by reference to the Company's Annual
Report on Form 10-K for the year ended December 31, 1990, (the "1990
Form 10-K")).
4.4 Certificate of Designation of Class A Preferred Stock (incorporated
by reference to the September 30, 1990 Form 10-Q).
10.1 Distributorship Agreement, dated November 2, 1989, between the
Company and Science Dynamics Corporation (incorporated by reference
to the 1989 Form 10-K).
10.2 Stock Purchase Agreement, dated November 2, 1989, between the
Company and H.F. Lenfest (incorporated by reference to the Company's
Report on Form 8-K, dated November 15, 1989, (the "1989 Form 8-K")).
10.3 Shareholders' Agreement, dated November 2, 1989, among the Company
and certain of its stockholders (incorporated by reference to the
Company's 1989 Form 8-K).
10.4 Option Agreement, dated November 2, 1989, among the Company and
certain of its stockholders (incorporated by reference to the 1989
Form 8-K).
10.5 Form of Credit Agreement between the Company and H.F. Lenfest
(incorporated by reference to the 1990 Form 10-K).
10.7 Form of Line of Credit Agreement between the Company and H.F.
Lenfest (incorporated by reference to the 1990 Form 10-K).
10.8 Subordinated Promissory Note, dated November 15, 1994 the principal
amount of $541,000 payable to Science Dynamics Corporation
(incorporated by reference to the 1994 Form 10-KSB).
10.10 Letter Agreement dated November 8, 1990 between Science Dynamics
Corporation and H.F. Lenfest (incorporated by reference to the
Company's Report on Form 8-K for November 16, 1990).
10.11 Loan Agreement dated December 24, 1991, between the Company and H.F.
Lenfest (incorporated by reference to the 1991 Form 10-K).
10.12 Lease Agreement for office space and the First Amendment to Lease
dated March 30, 1994, between the Company and Bloom Associates
(incorporated by reference to the 1994 Form 10-KSB).
10.13 Letter effective as of March 31, 1999, from H.F. Lenfest, waiving
the repayment of loans and accrued interest until January 1, 2001.
11. Statement re: Computation of Per Share Earnings (see the Company's
March 31, 1999 Financial Statements included herein).
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, thereunto duly authorized.
TELVUE CORPORATION
Dated: 5/06/99 By: /s/Frank J. Carcione
--------------------------------------------
Frank J. Carcione
President (Chief Executive Officer)
Dated: 5/06/99 By: /s/Irene A. DeZwaan
-------------------------------------------
Irene A. DeZwaan
Treasurer (Controller)
<PAGE>
EXHIBIT INDEX
10.13 Letter effective as of March 31, 1999, from H.F. Lenfest, waiving the
repayment of loans and accrued interest until January 1, 2001.
<PAGE>
As of March 31, 1999
Frank Carcione, President
TelVue Corporation
16000 Horizon Way, Suite 500
Mt. Laurel, NJ 08054
Dear Frank:
At your request, this will continue our prior agreement. Namely,
absent any default under the terms of my loans to TelVue or any other
obligations of TelVue to any other person, including, without limitation,
any voluntary or involuntary bankruptcy or insolvency proceedings by or
against TelVue, I agree not to demand repayment of the loans or payment in
cash of the accrued interest prior to January 1, 2001.
Very truly yours,
/s/H F Lenfest
-------------------
H.F. (Gerry) Lenfest
<PAGE>
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0
3,518,694
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