SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 30, 1996 (May 23,
1996)
CAI WIRELESS SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
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Connecticut 0-22888 06-1324691
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(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
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18 CORPORATE WOODS BLVD., ALBANY, NY 12211
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (518) 462-2632
(Former name or former address, if changed since last report)
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Item 5. OTHER EVENTS
(a) The Company has begun testing in Washington of the first Internet-
access product delivered by a wireless television company. The service uses
high-speed wireless modems and is capable of rapidly downloading to customers'
computers full-motion video, audio and data at speeds almost seven times faster
than the fastest telephony-based modems at consumer costs that are competitive
with other commercial Internet access providers. CAI plans to develop similar
systems in its other markets throughout the Northeast.
The wireless Internet service sends information to its customers'
computer terminals at a rate of 10 megabits per second (Mbps), nearly seven
times the rate of today's fastest T1 telephone lines, which transfer data at
1.5 Mbps. By year-end, CAI expects the data transfer rate to nearly triple,
reaching 27 Mbps, as wireless modem technology advances. The system's return
path receives information from customers through traditional telephony.
CAI's service utilizes multichannel multipoint distribution system
(MMDS) technology, which transmits microwave signals over the 2 gigahertz (Ghz)
band of the radio spectrum. MMDS enables superior signal transmission with
fewer disruptions than other wireless technologies transmitted at higher
frequencies, which are more susceptible to obstructions such as foliage and
environmental concerns such as rain and other precipitation. The MMDS
technology also allows high-speed access to Internet web browsers with greater
ease.
Wireless high-speed data transfer allows graphics-heavy Internet and
World Wide Web sites to be accessed easily, without concerns about errors
because of cable line noise. And although the system requires traditional
telephony to send data to CAI's Internet service, speed is not hampered because
heavy data transfer originates at web servers rather than at web explorers.
Unlike Internet services delivered by traditional hard-wire cable
programming providers, CAI's system does not require customers to subscribe to
the company's cable television programming. The Navy Computer and
Telecommunications Station in Washington (NCTSW), part of the U. S. Navy;
several Washington-area schools, including the Churchill Elementary School in
McLean, Va., and law firm Rini, Coran & Lancellotta are among the groups
involved in the trial, which originates from a facility on the campus of George
Washington University.
CAI is deploying the system in Washington with National Digital
Network (NDN), an Internet provider with MMDS channels in the top 25 markets.
Hybrid Networks is furnishing the high-speed modems used in the trial, and has
the first wireless modem in production for Internet networking via MMDS. The
Internet service uses a conditional access system similar to other Internet
access providers to ensure security.
(b) The following news release was issued on May 29, 1996:
CAI WIRELESS SYSTEMS, INC. ANNOUNCES 1995 FOURTH QUARTER AND YEAR END
RESULTS on May 29, 1996 (see exhibit 99.1).
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
C. EXHIBITS
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Exhibit No. Exhibit Description Location
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99.1 Media release - CAI Wireless Pages 5-7
Systems, Inc. announces 1995 fourth
quarter and year-end results, Dated May
29, 1996.
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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.
SIGNATURE TITLE DATE
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/S/ JARED E. ABBRUZZESE Chairman, Chief Executive Officer, May 30, 1996
Jared E. Abbruzzese and Director (Principal Executive
Officer)
/S/ JAMES P. ASHMAN Executive Vice President, Chief May 30, 1996
James P. Ashman Financial Officer and Director
/S/ CRAIG J. KESSLER Vice President and Controller May 30, 1996
Craig J. Kessler (Principal Accounting Officer)
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EXHIBIT 99.1
CAI WIRELESS SYSTEMS, INC.
FOR IMMEDIATE RELEASE
Investor Relations Contact: Company Contact:
Jason Thompson Jared Abbruzzese, CEO
Lippert/Heilshorn & Associates 518/462-2632
212/838-3777
CAI WIRELESS SYSTEMS, INC. ANNOUNCES
1995 FOURTH QUARTER AND YEAR-END RESULTS
Albany, NY, May 29, 1996 - CAI Wireless Systems, Inc. ("CAI") (NASDAQ NM:
CAWS) today announced results for fourth quarter and year-ended March 31, 1996.
For the fourth quarter ended March 31, 1996, sales increased 184% to
$10,344,000, versus $3,637,000 for the comparable year-ago quarter, primarily
due to system acquisitions and subscriber additions. Operating loss before
depreciation and amortization for the most recent quarter decreased to
$(2,003,000), versus $(3,433,000) for comparable year-ago quarter. Net loss for
the most recent quarter was $(11,186,000) or $(0.37) per common share, versus
$(7,011,000), or $(0.47) per common share, for the comparable year-ago quarter.
For the year ended March 31, 1996, sales increased 497% to $30,682,000
versus $5,141,000 for the year ended March 31, 1995, primarily due to system
acquisitions and subscriber additions. Operating loss before depreciation and
amortization decreased 4% to $(10,115,000) versus $(10,553,000) for the
comparable year-ago period. Net loss for the most recent year was
$(40,985,000), or $(1.73) per common share, versus $(14,107,000) or $(0.93) per
common share, for the year ended March 31, 1995.
Jared Abbruzzese, Chairman and Chief Executive Officer of CAI, said,
"Through an unprecedented series of mergers and acquisitions in the wireless
cable industry, CAI's sales have increased nearly five-fold in the past year.
We added 52,200 subscribers, expanding our subscriber base by 159% last year
and are beginning to see improved operating results in the most current
quarter."
CAI currently operates six wireless cable systems in New York City,
Rochester and Albany, NY, Philadelphia, PA, Washington, DC, and
Norfolk/Virginia Beach, VA and has a portfolio of wireless cable channel rights
in eight additional markets, including Long Island, Buffalo and Syracuse, NY,
Boston, MA, Providence, RI, Hartford, CT, Baltimore, MD, and Pittsburgh, PA. In
addition, CAI owns approximately 54% of CS Wireless Systems, Inc., ("CS
Wireless") which is jointly owned by Heartland Wireless Communications, Inc. CS
Wireless has approximately 5.7 million line-of-sight ("LOS") households and
55,800 subscribers in 12 markets located primarily in the Midwest and Southwest
regions of the United States.
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CAI WIRELESS SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
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Three Months Ended,
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March 31, March 31,
1996 1995
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REVENUES $ 10,344,000 $ 3,637,000
EXPENSES:
Programming and license fees 4,158,000 1,417,000
Marketing 935,000 1,302,000
General and administrative 7,254,000 4,351,000
12,347,000 7,070,000
OPERATING LOSS BEFORE DEPRECIATION
AND AMORTIZATION (2,003,000) (3,433,000)
Depreciation and amortization 7,050,000 2,427,000
OPERATING LOSS (9,053,000) (5,860,000)
OTHER INCOME (EXPENSE):
Other income 2,662,000 55,000
Interest expense (10,795,000) (1,517,000)
(8,133,000) (1,462,000)
LOSS BEFORE PROVISION FOR
INCOME TAXES (17,186,000) (7,322,000)
Provision for income tax benefits 6,000,000 --
LOSS BEFORE MINORITY INTEREST (11,186,000) (7,322,000)
Minority interest -- 311,000
NET LOSS $(11,186,000) $(7,011,000)
LOSS PER COMMON SHARE $(0.37) $(0.47)
Weighted average common shares
outstanding 37,829,482 15,551,723
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CAI WIRELESS SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
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Year Ended
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March 31, March 31,
1996 1995
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REVENUES $ 30,682,000 $5,141,000
EXPENSES:
Programming and license fees 12,583,000 2,021,000
Marketing 3,525,000 2,434,000
General and administrative 24,689,000 11,239,000
40,797,000 15,694,000
OPERATING LOSS BEFORE DEPRECIATION
AND AMORTIZATION (10,115,000) (10,553,000)
Depreciation and amortization 24,718,000 3,640,000
OPERATING LOSS (34,833,000) (14,193,000)
OTHER INCOME (EXPENSE):
Other income 6,118,000 937,000
Interest expense (24,592,000) 1,748,000)
(18,474,000) (811,000)
LOSS BEFORE PROVISION FOR
INCOME TAXES (53,307,000) (15,004,000)
Provision for income tax benefits 12,000,000 --
LOSS BEFORE MINORITY INTEREST (41,307,000) (15,004,000)
Minority interest 322,000 897,000
NET LOSS $(40,985,000) $(14,107,000)
LOSS PER COMMON SHARE $ (1.73) $ (0.93)
Weighted average common shares
outstanding 27,075,578 15,456,540
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