<PAGE> 1
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 September 30, 1997 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 0-19903
METRICOM, INC.
(A Delaware Corporation)
I.R.S. Employer Identification #77-0294597
980 University Avenue
Los Gatos, CA 95030-2375
(408) 399-8200
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 [X] No [ ]
The number of shares of common stock outstanding as of November 11, 1997
was 13,738,136.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C> <C> <C>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Condensed Consolidated Balance Sheets 3
Condensed Consolidated Statements of Operations 4
Condensed Consolidated Statements of Cash Flows 5
Notes to Condensed Consolidated Financial Statements 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Results of Operations 9
Liquidity and Capital Resources 12
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 14
SIGNATURE PAGE 15
EXHIBIT INDEX 16
</TABLE>
2
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
METRICOM, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
SEP. 30, DEC. 31,
1997 1996
---- ----
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents.......................................... $ 4,956 $ 15,246
Short-term investments............................................. 14,296 46,825
Accounts receivable, net........................................... 2,044 1,126
Inventories........................................................ 4,058 3,115
Prepaid expenses and other......................................... 1,232 1,744
--------- ----------
Total current assets........................................... 26,586 68,056
PROPERTY AND EQUIPMENT, net.......................................... 30,908 26,776
LONG-TERM INVESTMENTS................................................ -- 3,150
OTHER ASSETS......................................................... 3,641 3,817
--------------------
Total assets................................................... $ 61,135 $ 101,799
======== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable................................................... $ 3,413 $ 5,517
Accrued liabilities................................................ 5,788 4,801
--------- ----------
Total current liabilities...................................... 9,201 10,318
--------- ---------
LONG-TERM DEBT....................................................... 45,000 45,000
OTHER LIABILITIES.................................................... 834 768
MINORITY INTEREST.................................................... 4,598 2,407
STOCKHOLDERS' EQUITY:
Common stock....................................................... 14 14
Additional paid-in capital......................................... 134,183 133,298
Unrealized holding loss on investments............................. (3) (36)
Accumulated deficit................................................ (132,692) (89,970)
-------------------
Total stockholders' equity..................................... 1,502 43,306
---------- ----------
Total liabilities and stockholders' equity..................... $ 61,135 $ 101,799
======== =========
</TABLE>
The accompanying notes are an integral part of these consolidated statements.
3
<PAGE> 4
METRICOM, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
----------------------------- ----------------------------
SEP. 30, 1997 SEP. 27, 1996 SEP. 30, 1997 SEP. 27, 1996
------------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
REVENUES:
Service revenues ......................... $1,607 $ 704 $ 4,980 $ 1,243
Product revenues ......................... 1,534 644 4,697 4,362
-------- -------- -------- --------
Total revenues ....................... 3,141 1,348 9,677 5,605
-------- -------- -------- --------
COSTS AND EXPENSES:
Cost of service revenues ................. 6,299 5,106 19,973 12,583
Cost of product revenues ................. 1,297 312 2,984 2,258
Research and development ................. 2,763 2,295 8,652 6,910
Selling, general and
administrative ........................ 4,876 4,816 15,640 12,098
Provision for Overall Wireless ........... -- -- 3,611 --
-------- -------- -------- --------
Total costs and expenses ................. 15,235 12,529 50,860 33,849
-------- -------- -------- --------
Loss from operations ................... (12,094) (11,181) (41,183) (28,244)
INTEREST EXPENSE ........................... 1,071 349 3,202 349
INTEREST INCOME ............................ 353 776 1,663 2,262
-------- -------- -------- --------
Net loss................................ $(12,812) $(10,754) $(42,722) $(26,331)
======== ======== ======== ========
NET LOSS PER SHARE.......................... $ (0.94) $ (0.80) $ (3.14) $ (1.97)
======== ======== ======== ========
WEIGHTED AVERAGE
SHARES OUTSTANDING .................... 13,648 13,462 13,610 13,382
======== ======== ======== ========
</TABLE>
The accompanying notes are an integral part of these consolidated statements.
4
<PAGE> 5
METRICOM, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
------------------------
SEP. 30, SEP. 27,
1997 1996
-------- --------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss............................................................. $(42,722) $(26,331)
Adjustments to reconcile net loss to net
cash used in operating activities-
Depreciation and amortization .................................... 5,782 2,745
Provision for Overall Wireless ................................... 3,611 --
(Increase) decrease in accounts receivable,
prepaid expenses and other current assets ..................... 33 (433)
(Increase) decrease in inventories ............................... (943) 1,059
(Decrease) increase in accounts payable, accrued
liabilities, customer deposits and other ...................... (1,051) 3,877
-------- --------
Net cash used in operating
activities ................................................ (35,290) (19,083)
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment .................................. (10,237) (9,012)
Increase in other assets ............................................. (3,551) (1,191)
Sales of short-term and long-term
investments ...................................................... 35,712 12,067
-------- --------
Net cash provided by investing activities ................... 21,924 1,864
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock ............................... 885 1,106
Proceeds from issuance of long-term debt, net ........................ -- 43,350
Contributions from minority interest ................................. 2,191 1,105
-------- --------
Net cash provided by financing activities ................... 3,076 45,561
-------- --------
NET (DECREASE) INCREASE IN CASH AND
EQUIVALENTS ......................................................... (10,290) 28,342
CASH AND EQUIVALENTS, BEGINNING OF PERIOD .............................. 15,246 5,201
-------- --------
CASH AND EQUIVALENTS, END OF PERIOD .................................... $ 4,956 $ 33,543
======== ========
</TABLE>
The accompanying notes are an integral part of these consolidated statements.
5
<PAGE> 6
METRICOM, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. BASIS OF PRESENTATION
The condensed consolidated financial statements of Metricom, Inc. (the
"Company") presented in this Form 10-Q are unaudited. In the opinion of
management, the accompanying condensed consolidated financial statements reflect
all adjustments (which includes only normal recurring adjustments) which are
necessary for a fair presentation of operations for the three- and nine-month
periods ended September 30, 1997 and September 27, 1996. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted pursuant to the rules and regulations of the Securities and Exchange
Commission. These condensed consolidated financial statements should be read in
conjunction with the audited consolidated financial statements and the notes
thereto incorporated by reference in the Company's Annual Report on Form 10-K,
as amended, for the year ended December 31, 1996, as filed with the Securities
and Exchange Commission.
Certain amounts have been restated from the previously reported balances
to conform to the 1997 presentation. The preparation of 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 disclosures of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
The results of operations for the three- and nine-month periods ended September
30, 1997 and September 27, 1996 are not necessarily indicative of the results
expected for the full fiscal year or for any other fiscal period.
NOTE 2. INVENTORIES
Inventories are stated at the lower of cost (first-in, first-out)
or market and include purchased parts, labor and manufacturing overhead.
Inventories consisted of the following (in thousands):
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1997 1996
---- ----
<S> <C> <C>
Raw materials $ 1,612 $ 656
Work-in-progress 399 1,606
Finished goods 2,047 853
------- -------
Total $ 4,058 $ 3,115
======= =======
</TABLE>
6
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NOTE 3. NET LOSS PER SHARE
Net loss per share has been computed using the weighted average number
of shares of common stock outstanding. Common equivalent shares from options and
warrants to purchase common stock have been excluded from the calculation as
their effect would be anti-dilutive.
NOTE 4. OPTION TO ACQUIRE OVERALL WIRELESS COMMUNICATIONS CORPORATION
In February 1996, the Company purchased an option to acquire Overall
Wireless Communications Corporation ("Overall Wireless"), a corporation that
holds a nationwide, wireless communications license issued by the Federal
Communications Commission (the "FCC") with respect to 50 kHz of radio spectrum
in the 220 to 222 MHz frequency band. The Company paid $700,000 for the option
and agreed to loan Overall Wireless up to $2 million for the construction of a
system utilizing the license, of which approximately $1.9 million has already
been loaned. In January 1997, the Company paid $500,000 to extend the option
from January 1997 to July 1997. The option was subsequently extended to December
31, 2000 for no additional cash consideration. Either party may terminate the
option with 10 days' notice. The additional consideration payable upon exercise
of the option includes a combination of cash and stock valued at $7.3 million in
the aggregate plus certain operating expenses incurred by Overall Wireless prior
to the exercise of the option. The Company's ability to exercise the option is
conditioned upon the occurrence of a number of events, including approval by the
FCC of the transfer of the license. There can be no assurance that these
conditions will be met prior to expiration of the option. If the option expires
unexercised under certain circumstances, the Company may be required to pay a
termination fee of up to $2 million, which would be paid through cancellation of
the indebtedness of Overall Wireless. In June 1997, the Company recorded a
charge of $3.6 million to fully reserve its investment in Overall Wireless due
to uncertainties regarding its realization.
NOTE 5. NEW ACCOUNTING STANDARDS
In February 1997, Statement of Financial Accounting Standards ("SFAS")
No. 128, "Earnings Per Share" was issued. SFAS 128 replaces the presentation of
primary earnings per share with a presentation of basic earnings per share,
which excludes dilution. SFAS 128 also requires dual presentation of basic and
diluted earnings per share on the face of the income statement for all entities
with a complex capital structure. Diluted earnings per share are computed
similarly to fully diluted earnings per share pursuant to APB No. 15. SFAS 128
must be adopted for financial statements issued for interim and annual periods
ending after December 15, 1997. If SFAS 128 had been applied during the three-
and nine-month periods ended September 30, 1997 and September 27, 1996, basic
earnings per share and diluted earnings per share would equal earnings per share
as presented.
7
<PAGE> 8
In July 1997, SFAS No. 130 , "Reporting Comprehensive Income" was issued
and is effective for fiscal years beginning after December 15, 1997. The
adoption is not expected to have a material effect on the financial statements.
In June 1997, SFAS No. 131, "Disclosures About Segments of Enterprises
and Related Information" was issued and is effective for fiscal years beginning
after December 15, 1997. The Company yet to determine the impact, if any, of the
adoption of this new pronouncement.
8
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
OVERVIEW
Except for historical information contained herein, this Management's
Discussion and Analysis of Financial Condition and Results of Operations
contains forward-looking statements that involve risks and uncertainties. The
Company's actual results could differ materially from those discussed here.
Factors that could cause or contribute to such differences include, but are not
limited to, the completion of development of the Company's ISDN-speed network,
uncertainty of market acceptance of the Company's products and services,
availability of sufficient financial, management, technical and marketing
resources, performance and availability of the Company's Ricochet(R) radios and
modems, the ability of the Company to lease or acquire sites for the location of
its network infrastructure, the ability of the Company to enter into
partnerships to deploy Ricochet networks and those factors discussed in the
section entitled "Risk Factors" and elsewhere in the Company's Form 10-K, as
amended, for the year ended December 31, 1996, as well as those elsewhere in
this Form 10-Q.
RESULTS OF OPERATIONS
Revenues
Revenues consist of service and product revenues. Service revenues are
derived from the subscriber fees and modem rentals for Ricochet and fees for
UtiliNet(R) customer support and are recognized ratably over the service period.
Product revenues are derived from the sale of UtiliNet products and Ricochet
modems and are recognized upon shipment.
Total revenues increased to $3.1 million for the third quarter of 1997
and to $9.7 million for the first nine months of 1997 from $1.3 million for the
third quarter of 1996 and $5.6 million for the first nine months of 1996.
Service revenues increased to $1.6 million for the third quarter of 1997 and to
$5.0 million for the first nine months of 1997 from $704,000 for the third
quarter of 1996 and $1.2 million for the first nine months of 1996. The increase
in service revenues is primarily due to increased Ricochet subscriber fees and
modem rentals resulting from a larger Ricochet subscriber base. Product revenues
increased to $1.5 million for the third quarter of 1997 and to $4.7 million for
the first nine months of 1997 from $644,000 for the third quarter of 1996 and
$4.4 million for the first nine months of 1996. The increases in product
revenues were primarily due to the timing of shipments of UtiliNet products and
increased sales of Ricochet modems in 1997 compared to 1996.
9
<PAGE> 10
Cost of Revenues
Cost of service revenues is primarily costs incurred to deploy and
operate Ricochet networks, the cost to obtain site agreements for the Company's
network infrastructure, the cost of providing customer support, certain costs
associated with manufacturing the Company's network components and depreciation
of modems rented to Ricochet subscribers.
Cost of service revenues increased to $6.3 million for the third quarter
of 1997 and to $20.0 million for the first nine months of 1997 from $5.1 million
for the third quarter of 1996 and $12.6 million for the first nine months of
1996. The increases are primarily due to higher Ricochet network operating
expenses resulting from increases in the Ricochet service territory during 1997
and higher customer service expenses and depreciation of modems rented to
Ricochet subscribers as a result of the larger Ricochet subscriber base in 1997.
These increases were partially offset by a reduced level of activity to obtain
site agreements in the second and third quarters of 1997 as compared to the same
periods in 1996. Cost of service revenues is expected to increase in the future
primarily due to increased efforts to obtain site agreements for the Company's
network infrastructure.
Cost of product revenues increased to $1.3 million for the third quarter
of 1997 and to $3.0 million for the first nine months of 1997 from $312,000 for
the third quarter of 1996 and $2.3 million for the first nine months of 1996.
Cost of product revenues as a percentage of product revenues increased to 85%
for the third quarter of 1997 and to 64% for the first nine months of 1997 from
48% for the third quarter of 1996 and 52% for the first nine months of 1996. The
increase was primarily due to a higher percentage of product revenues in the
third quarter of 1997 derived from the sale of Ricochet modems that were sold
for less than the cost to manufacture them.
Research and Development
Research and development expenses increased to $2.8 million for the
third quarter of 1997 and to $8.7 million for the first nine months of 1997 from
$2.3 million for the third quarter of 1996 and from $6.9 million for the first
nine months of 1996. Research and development activities include the development
of an ISDN-speed network and subscriber device and enhancements to the
technology employed by the Company's current networks. The Company plans to
significantly increase the level of investment in research and development in
the foreseeable future.
10
<PAGE> 11
Selling, General and Administrative
Selling, general and administrative expenses increased to $4.9 million
for the third quarter of 1997 and to $15.6 million for the first nine months of
1997 from $4.8 million for the third quarter of 1996 and $12.1 million for the
first nine months of 1996. The increase for the first nine months of 1997 was
primarily due to increased selling expenses as a result of increased personnel
and advertising expenses in the first six months of 1997 compared to the
comparable period in 1996. General and administrative expenses increased
primarily as a result of personnel increases and professional fees associated
with addressing regulatory matters, developing strategic relationships and
pursuing financing arrangements. Selling, general and administrative expenses
are expected to continue at the current level for the foreseeable future.
Provision for Overall Wireless
In February 1996, the Company purchased an option to acquire Overall
Wireless, a corporation that holds a nationwide, wireless communications license
issued by the FCC with respect to 50 kHz of radio spectrum in the 220 to 222 MHz
frequency band. The Company paid $700,000 for the option and agreed to loan
Overall Wireless up to $2 million for the construction of a system utilizing the
license, of which approximately $1.9 million has already been loaned. In January
1997, the Company paid $500,000 to extend the option from January 1997 to July
1997. The option was subsequently extended to December 31, 2000 for no
additional cash consideration. Either party may terminate the option with 10
days' notice. If the option expires unexercised under certain circumstances, the
Company may be required to pay a termination fee of up to $2 million, which
would be paid through cancellation of the indebtedness of Overall Wireless. In
June 1997, the Company recorded a charge of $3.6 million to fully reserve its
investment in Overall Wireless due to uncertainties regarding its realizability.
Interest Income and Expense
Interest expense increased to $1.1 million for the third quarter of 1997
and to $3.2 million for the first nine months of 1997 from $349,000 for the
third quarter of 1996 and $349,000 for the first nine months of 1996. The
increase in 1997 was a result of the issuance in August 1996 of $45 million in
principal amount of 8% Convertible Subordinated Notes due 2003. Interest income
decreased to $353,000 for the third quarter of 1997 and to $2.3 million for the
first nine months of 1997 from $776,000 for the third quarter of 1996 and $2.3
million for the first nine months of 1996 due to a lower level of cash and
investments in 1997 as compared to 1996.
11
<PAGE> 12
LIQUIDITY AND CAPITAL RESOURCES
Since inception, the Company has devoted significant resources to the
development, deployment and commercialization of wireless network products and
services. As a result, as of September 30, 1997, the Company had incurred $132.7
million of cumulative net losses. The Company has financed operations primarily
through the public and private sale of equity and convertible debt securities.
On October 10, 1997, the Company entered into a stock purchase agreement
(the "Stock Purchase Agreement") with Vulcan Ventures Incorporated ("Vulcan"), a
Washington corporation. Under the terms of the Stock Purchase Agreement, Vulcan
will purchase from the Company 4,650,000 shares of Company's common stock for
$12.00 per share in cash. This transaction is subject to regulatory approval and
the approval of the Company's common stockholders at a Special Meeting of
Stockholders to be held in January 1998. In a separate agreement, Vulcan
proposes to purchase from Lindner Investments, the Company's largest
shareholder, 2,583,500 shares of the Company's previously issued common stock.
Upon closing of the transactions, Vulcan will own approximately 49.9% of the
Company's outstanding stock. As part of the Stock Purchase Agreement, Vulcan has
agreed to loan the Company up to $10 million in the form of an unsecured credit
facility. Outstanding advances bear interest at the rate of 12% per annum.
Outstanding advances under the credit facility are due nine months from the
initial borrowing date, but would be repaid from the net proceeds to the Company
from Vulcan or from any prior issuance of securities in a capital raising
transaction.
The Company's operations have required substantial capital investments
for the purchase of Ricochet network equipment, Ricochet modems, and computer
and office equipment. Capital expenditures were $10.2 million and $9.0 million
in the first nine months of 1997 and 1996, respectively. The Company expects to
make significant capital expenditures in connection with the development,
deployment and commercialization of its Ricochet networks including the costs
associated with renting modems to Ricochet subscribers. The amount and timing of
expenditures, however, may vary significantly depending on numerous factors
including the completion of development of the Company's ISDN-speed network,
market acceptance of the Company's products and services, availability of
sufficient financial, management, technical and marketing resources, performance
and availability of the Company's Ricochet radios and modems, the ability of the
Company to lease or acquire sites for the location of its network
infrastructure, the ability of the Company to enter into partnerships to deploy
Ricochet networks and those factors discussed in the section entitled "Risk
Factors" and elsewhere in the Company's Form 10-K, as amended, for the year
ended December 31, 1996, as well as those elsewhere in this Form 10-Q.
12
<PAGE> 13
The Company believes that significant additional capital will be
required in the future to fund further development, deployment and
commercialization of its Ricochet networks. There can be no assurance that such
additional funds will be available on commercially reasonable terms or at all.
The Company believes that its existing available cash and investments, together
with funds to be provided by Vulcan upon closing of the transactions
contemplated by the Stock Purchase Agreement, are adequate to meet the Company's
needs through the third quarter of 1998. If the transactions contemplated by the
Stock Purchase Agreement are not completed, the Company would be required to
seek alternative financing arrangements that may include debt, equity, debt with
equity or equity-linked securities. There can be no assurance that such funds
would be available on commercially reasonable terms or at all. If sufficient
financing is not available, the Company would be required to significantly
reduce its development, deployment, and commercialization activities.
As of September 30, 1997, the Company had cash and equivalents and
short-term and long-term investments of $19.3 million and working capital of
$17.4 million. Accounts receivable increased to $2.0 million as of September 30,
1997, from $1.1 million as of December 31, 1996, due primarily to increased
shipments of UtiliNet products at the end of the third quarter of 1997 as
compared to the end of the fourth quarter of 1996. Inventories increased to $4.1
million as of September 30, 1997, from $3.1 million as of December 31, 1996
primarily due primarily to an increase in Ricochet subscriber devices and
UtiliNet products. The Company believes that both accounts receivable and
inventories will increase in the future in order to support the
commercialization of Ricochet.
13
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PART II. OTHER INFORMATION
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits:
27.00 Financial Data Schedule
b. Reports on Form 8-K:
On October 17, 1997, the Company filed a Form 8-K regarding the
proposed sale of 4,650,000 shares of the Company's Common Stock
to Vulcan Ventures Incorporated for $12.00 per share in cash.
14
<PAGE> 15
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.
METRICOM, INC.
(Registrant)
/s/ Vanessa A. Wittman
--------------------------------
Date: November 11, 1997 By: Vanessa A. Wittman
Vice President, Finance and Duly
Authorized Officer
15
<PAGE> 16
EXHIBIT INDEX
27.00 Financial Data Schedule
16
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S REPORT ON FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 1997 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH REPORT.
</LEGEND>
<MULTIPLIER>1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 4,956
<SECURITIES> 14,296
<RECEIVABLES> 2,044
<ALLOWANCES> 0
<INVENTORY> 4,058
<CURRENT-ASSETS> 26,586
<PP&E> 42,905
<DEPRECIATION> (11,997)
<TOTAL-ASSETS> 61,135
<CURRENT-LIABILITIES> 9,201
<BONDS> 45,000
0
0
<COMMON> 14
<OTHER-SE> 1,488
<TOTAL-LIABILITY-AND-EQUITY> 61,135
<SALES> 4,697
<TOTAL-REVENUES> 9,677
<CGS> 2,984
<TOTAL-COSTS> 50,860
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,202
<INCOME-PRETAX> (42,722)
<INCOME-TAX> 0
<INCOME-CONTINUING> (42,722)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (42,722)
<EPS-PRIMARY> (3.14)
<EPS-DILUTED> (3.14)
</TABLE>
