<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
--------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the period from to
----------------- --------------
Commission file number 0-26140
---------
HIGHWAYMASTER COMMUNICATIONS, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 51-0352879
- ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
16479 Dallas Parkway, Suite 710, Dallas, Texas 75248
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (972) 732-2500
--------------
Not Applicable
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report.)
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 [ ]
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.
Number of Shares Outstanding as of
Title of each class May 11, 1997
- ---------------------------- -----------------------------------
Common Stock, $.01 par value 24,898,986
<PAGE> 2
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
Form 10-Q
INDEX
<TABLE>
<CAPTION>
PAGE
NUMBER
<S> <C>
PART I. FINANCIAL INFORMATION
Item 1 Consolidated Financial Statements:
Consolidated Balance Sheets at March 31, 1998
and December 31, 1997 1
Consolidated Statements of Operations for the
three months ended March 31, 1998 and 1997 2
Consolidated Statements of Cash Flows for the three
months ended March 31, 1998 and 1997 3
Consolidated Statement of Changes in Stockholders'
Equity (Deficit) for the three months ended
March 31, 1998 4
Notes to Consolidated Financial Statements 5-6
Item 2 Management's Discussion and Analysis of
Financial Condition and Results of Operations 7-8
Item 3 Quantitative and Qualitative Disclosures About
Market Risk 9
PART II. OTHER INFORMATION
Item 1 Legal Proceedings 10
Item 2 Changes in Securities 10
Item 3 Defaults Upon Senior Securities 10
Item 4 Submission of Matters to a Vote of Security Holders 10
Item 5 Other Information 10
Item 6 Exhibits and Reports on Form 8-K 10
Signatures 11
</TABLE>
<PAGE> 3
PART I - FINANCIAL INFORMATION
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(in thousands)
<TABLE>
<CAPTION>
ASSETS
March 31, December 31,
1998 1997
---------- ----------
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 21,962 $ 26,777
Temporary investments - current portion 18,295 19,709
Accounts receivable, net 14,456 13,963
Other short-term receivables 770 916
Inventory 4,900 3,145
Pledged securities - current portion 17,187 17,187
Prepaid expenses 420 279
---------- ----------
Total current assets 77,990 81,976
Network, equipment and software, net 16,698 15,482
Temporary investments - long-term portion 10,365 13,626
Pledged securities - long-term portion 22,623 30,216
Other assets, net 4,970 5,173
---------- ----------
Total assets $ 132,646 $ 146,473
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable $ 6,528 $ 6,262
Telecommunications costs payable 3,141 2,192
Accrued interest payable 764 4,679
Other current liabilities 4,446 4,114
---------- ----------
Total current liabilities 14,879 17,247
Senior notes payable 121,086 120,956
---------- ----------
Total liabilities 135,965 138,203
---------- ----------
Stockholders' equity (deficit):
Preferred stock -- --
Common stock 252 252
Additional paid-in capital 149,481 149,481
Accumulated deficit (152,505) (140,916)
Treasury stock (547) (547)
---------- ----------
Total stockholders' equity (deficit) (3,319) 8,270
Commitments and contingencies
---------- ----------
Total liabilities and stockholders' equity (deficit) $ 132,646 $ 146,473
========== ==========
</TABLE>
See accompanying notes to consolidated financial statements.
1
<PAGE> 4
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(in thousands, except per share)
<TABLE>
<CAPTION>
Three months ended
March 31,
--------------------------
1998 1997
---------- ----------
<S> <C> <C>
Revenues:
Product $ 4,627 $ 5,832
Service 11,096 5,058
---------- ----------
Total revenues 15,723 10,890
---------- ----------
Cost of revenues:
Product 3,747 4,998
Service 8,715 3,607
---------- ----------
Total cost of revenues 12,462 8,605
---------- ----------
Gross profit 3,261 2,285
---------- ----------
Expenses:
General and administrative 3,334 3,605
Customer service 3,364 2,231
Sales and marketing 2,179 2,092
Engineering 1,409 1,117
Network services center 397 284
Depreciation and amortization 1,069 493
---------- ----------
11,752 9,822
---------- ----------
Operating loss (8,491) (7,537)
Interest income 1,342 163
Interest expense (4,440) --
---------- ----------
Loss before income taxes (11,589) (7,374)
Income tax provision -- --
---------- ----------
Net loss (11,589) (7,374)
========== ==========
Per share:
Basic and diluted net loss $ (0.47) $ (0.30)
========== ==========
Weighted average number of shares outstanding 24,899 24,844
========== ==========
</TABLE>
See accompanying notes to consolidated financial statements.
2
<PAGE> 5
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(in thousands)
<TABLE>
<CAPTION>
Three months ended
March 31,
--------------------------
1998 1997
---------- ----------
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (11,589) $ (7,374)
Adjustments to reconcile net loss to cash used in
operating activities:
Depreciation and amortization 1,069 493
Amortization of discount on notes payable 130 --
(Increase) in accounts receivable (493) (1,144)
Decrease in other receivables 170 997
(Increase) decrease in inventory (1,755) 673
Increase in accounts payable 266 1,154
Increase (decrease) in accrued expenses and other current liabilities (2,634) 192
Other (37) (50)
---------- ----------
Net cash used in operating activities (14,873) (5,059)
---------- ----------
Cash flows from investing activities:
Additions to network and equipment (1,928) (543)
Additions to capitalized software (282) (179)
Decrease in pledged securities 7,593 --
Decrease in temporary investments 4,675 --
---------- ----------
Net cash provided by (used in) investing activities 10,058 (722)
---------- ----------
Cash flows from financing activities:
Proceeds from exercise of stock options -- 121
---------- ----------
Net cash provided by financing activities -- 121
---------- ----------
(Decrease) in cash (4,815) (5,660)
Cash and cash equivalents, beginning of period 26,777 19,725
---------- ----------
Cash and cash equivalents, end of period $ 21,962 $ 14,065
========== ==========
Supplemental cash flow information:
Interest paid $ 8,212 $ --
========== ==========
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE> 6
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
Three months ended March 31, 1998
(UNAUDITED)
(in thousands, except share information)
<TABLE>
<CAPTION>
Preferred Stock Common Stock Additional Treasury Stock
----------------- --------------------- Paid-in ------------------ Accumulated
Shares Amount Shares Amount Capital Shares Amount Deficit Total
----------------- --------------------- ----------- -------- --------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Stockholders' equity at
December 31, 1997 1,000 $ -- 25,210,983 $ 252 $ 149,481 311,997 $ (547) $ (140,916) $ 8,270
Net loss (11,589) (11,589)
------------- -------------------- ---------- ------------------ --------------------------
Stockholders' equity at
March 31, 1998 1,000 $ -- 25,210,983 $ 252 $ 149,481 311,997 $ (547) $ (152,505) $ (3,319)
============= ==================== ========== ================== ==========================
</TABLE>
See accompanying notes to consolidated financial statements.
4
<PAGE> 7
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
Notes To Consolidated Financial Statements
(Unaudited)
1. BUSINESS OVERVIEW
The Company develops and implements mobile communications
solutions, including integrated voice, data and position location
services, to meet the needs of its customers. The initial application
for the Company's wireless enhanced services has been developed for,
and is marketed and sold to, companies which operate in the long-haul
trucking market. The Company provides long-haul trucking companies
with a comprehensive package of mobile communications and management
control services at low, fixed per minute rates, thereby enabling its
trucking customers to effectively monitor the operations and improve
the performance of their fleets. The Company is currently developing
additional applications for its network to expand the range of trucking
companies that utilize its services and to address the needs of the
automotive and other markets. Among other things, the Company entered
into a strategic business alliance with Prince Corporation, a
subsidiary of Johnson Controls, Inc. and a leading supplier of
automotive interior systems and components, to develop and provide an
automobile safety and security service, the "AutoLink" service, to
motorists in the United States and Canada. The AutoLink service is
planned to be available on a commercial basis beginning in late 1998.
Through 1997, the Company derived all of its revenues from the
long-haul trucking market from sales and installation of Mobile
Communication Units ("mobile units") and charges for its services. In
early 1998, the Company commenced marketing a mobile communication
solution applicable to broader segments of the trucking market.
2. BASIS OF PRESENTATION
The unaudited consolidated financial statements presented
herein have been prepared in accordance with the instructions to Form
10-Q and Article 10 of Regulation S-X. Accordingly, they do not include
all footnote disclosures required by generally accepted accounting
principles. These consolidated financial statements should be read in
conjunction with the Company's audited consolidated financial
statements for the year ended December 31, 1997. The accompanying
consolidated financial statements reflect all adjustments (all of which
are of a normal recurring nature) which are, in the opinion of
management, necessary for a fair presentation of the Company's
financial position, results of operations and cash flows for the
interim periods. The results for any interim period are not necessarily
indicative of the results for the entire year.
3. INVENTORIES
<TABLE>
<CAPTION>
March 31, December 31,
1998 1997
---------- ----------
<S> <C> <C>
Complete systems $3,884,000 $1,370,000
Component parts 1,016,000 1,775,000
---------- ----------
$4,900,000 $3,145,000
========== ==========
</TABLE>
4. LITIGATION
As previously reported, the Company is party to a lawsuit
filed in the U.S. District Court, Northern District of Texas, Dallas
Division against AT&T Corp. ("AT&T") and Lucent Technologies, Inc.
5
<PAGE> 8
("Lucent"). Since the filing of the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1997, there have been no material changes.
6
<PAGE> 9
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
COMPARABILITY
During 1997, the Company's service revenues were generated from mobile
units served by either a switching complex operated by AT&T (the " AT&T
Complex") or by the Company's Network Services Center ("NSC"). During the three
months ended March 31, 1997, the majority of the installed base of mobile units
was served by the AT&T Complex. During the three months ended March 31, 1998,
the entire installed base of mobile units was served by the NSC. Historically,
the amount of service revenue and related expense recognized by the Company
varied significantly based upon whether a particular customer received service
through the AT&T Complex or the NSC. In the case of customers served through the
AT&T Complex, service charges were collected by AT&T. The Company recognized as
revenue the portion of service charges received from AT&T, with the remainder of
the service charges retained by AT&T as compensation for its cost of providing
services. In the case of customers served by the NSC, the entire amount of the
service charges to customers is recognized by the Company as revenue and
additional operating and service expenses are borne by the Company. The
operating expenses associated with the NSC are reflected in the Company's
financial statements as general and administrative expenses (customer billing,
credit, and collection activities), network services center (other third party
and internal operating expenses) and depreciation. Because of the difference in
the economic relationships described above, as a greater proportion of customers
have been served by the NSC, the Company recognized increased service revenues,
which were partially offset by additional operating and service expenses.
Because the operating expenses associated with the NSC include certain fixed
costs, such operating expenses are not expected to increase proportionately with
the number of customers added.
RESULTS OF OPERATIONS
Three Months Ended March 31, 1998 Compared to Three Months Ended March
31, 1997
Total revenues increased from $10.9 million in 1997 to $15.7 million in
1998. Product revenues decreased from $5.8 million in 1997 to $4.6 million in
1998 primarily as a result of a 25.0% decrease in mobile units sold. Product
shipments in 1998 were less than the Company's expectations. Service revenues
increased to $11.1 million in 1998 as compared to $5.1 million in 1997 due to
the combined effect of (i) the increased installed base of mobile units and (ii)
increased service revenues per mobile unit. Average monthly revenue per mobile
unit in 1998 increased to $104.64 from $78.20 in 1997 since the entire installed
base of mobile units was served through the NSC in 1998, as compared to the
majority of the installed base being served through the AT&T Complex in 1997.
Cost of revenues in 1998 was $12.5 million compared to $8.6 million in
1997. This is primarily as a result of the increased number of mobile units sold
and in service.
Product gross profit margin was 19.0% in 1998 compared to 14.3% in
1997. The improvement in product gross profit margin is primarily attributable
to a lower average cost per mobile unit sold and a lower provision for warranty
costs. The lower average cost per mobile unit is attributable to the combined
effect of a larger percentage of mobile unit sales in 1998 being lower cost
refurbished units and manufacturing and procurement economies reducing the cost
of new units.
Service gross profit margin was 21.5% in 1998 compared to 28.7% in
1997. The Company incurs certain costs for airtime usage that are not billable
to customers under current billing practices. Billing data received subsequent
to March 31, 1997 indicated that the portion of airtime usage not billable to
customers was higher than previously believed by the Company and used as the
basis for recording accounting estimates. An increase in cost of cellular
airtime paid for by the Company in relation to airtime billable to customers
caused the decrease in service gross profit margin. The Company is evaluating
the factors underlying the increase in cellular airtime costs to identify and
analyze technical adjustments and modifications that may enable it to
7
<PAGE> 10
improve its service gross profit margin.
General and administrative expenses decreased from $3.6 million in 1997
to $3.3 million in 1998. This decrease is because during the 1997 period, the
Company recorded a $1 million charge to provide for loss on the sales-type lease
receivable due from a customer as a result of the customer's early termination
of the lease. Partially offsetting this decrease are increased expenses
reflecting (i) costs associated with billing, credit and collection activities
for the NSC, (ii) growth in the number of employees and salary increases, and
(iii) consulting fees in connection with evaluation of the Company's information
systems and efforts to improve service gross profit margin.
Customer service expenses increased to $3.4 million in 1998 compared to
$2.2 million in 1997, attributable to the increasing emphasis on improving
response to customer needs, improvement in the technical operations of the
network and growth in the number of mobile units shipped and in service.
Sales and marketing expenses increased to $2.2 million in 1998
compared to $2.1 million in 1997. This increase is composed of a $0.3 million
increase in advertising expense as a result of AutoLink and the recently
introduced Series 3000 mobile unit and Platinum service, offset by a $0.2
million decrease in payroll related expenditures as a result of a decrease in
the number of sales and marketing employees.
Engineering expenses increased to $1.4 million in 1998 compared to $1.1
million in 1997. This increase is primarily attributable to increases in payroll
related costs as a result of an increase in the number of engineering personnel
devoted to continuation engineering and new product development, and other costs
specifically related to the development and release of the AutoLink service.
Depreciation and amortization expense increased to $1.1 million in 1998
compared to $0.5 million in 1997 reflecting the additional depreciation and
amortization as a result of additions to network, equipment and capitalized
software during 1997.
Interest income was $1.3 million in 1998 compared to $0.2 million in
1997. Interest expense was $4.4 million in 1998 compared to zero in 1997. The
change in these relationships reflects the higher average outstanding balances
during 1998 in cash and cash equivalents, temporary investments and notes
payable as a result of the issuance of the Senior Notes in September,1997.
LIQUIDITY AND CAPITAL RESOURCES
Net cash consumed by operating activities during the three months
ended March 31, 1998 was $14.9 million due primarily to a $11.6 million loss
from operations, a temporary increase in inventory quantities of complete
systems as a result of sales not meeting expectations, and a decrease in accrued
interest payable as a result of the semi-annual interest payment on the Senior
Notes. The Company's cash, cash equivalents and temporary investments balance at
March 31, 1998 was $50.6 million. Based on the Company's projected operating
results, the Company believes its existing capital resources will be sufficient
to fund its currently anticipated operating needs and capital expenditure
requirements for at least the next twelve months. However, the Company's future
cash flow from operations and operating requirements may vary depending on a
number of factors, including the rate of installation of mobile units, the level
of competition, success of new products, general economic conditions and other
factors beyond the Company's control.
FORWARD LOOKING STATEMENTS
This report includes "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements other than
statements of historical fact included in this report, including without
limitation, certain statements in this Item 2 under the captions "---Results of
Operations" and "---Liquidity and Capital Resources," may constitute forward
looking statements. Although the Company believes that the expectations
reflected in such forward-looking statements are reasonable, it can give no
assurance that such expectations will prove to be correct. Important factors
that could cause actual results to differ materially from the Company's
expectations ("cautionary statements") are disclosed in this report and the
Company's Annual Report on Form 10-K for the year ended December 31, 1997 (under
the caption "Business --- Risk Factors" and elsewhere). All subsequent written
and oral forward-looking statements attributable to the Company or persons
acting on its behalf are expressly qualified in their entirety by these
cautionary statements.
8
<PAGE> 11
ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not Applicable.
9
<PAGE> 12
HIGHWAYMASTER COMMUNICATIONS, INC. AND SUBSIDIARY
PART II - OTHER INFORMATION
Item 1. Legal Proceedings --
AT&T Litigation. As previously reported, the Company is party to a
lawsuit filed in the U.S. District Court, Northern District of Texas,
Dallas Division against AT&T Corp. ("AT&T") and Lucent Technologies,
Inc. ("Lucent"). Since the filing of the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1997, there have been
no material changes.
Item 2. Changes in Securities -- None.
Item 3. Defaults 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) Exhibits - See the Index to Exhibits.
(b) Reports on Form 8-K -- None.
10
<PAGE> 13
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.
HIGHWAYMASTER COMMUNICATIONS, INC.
Date: May 11, 1997
By: /s/ William C. Saunders
--------------------------------------------
William C. Saunders
President and Chief Executive Officer
By: /s/ J. Philip McCormick
--------------------------------------------
J. Philip McCormick
Executive Vice President and Chief Financial
Officer (Principal Financial Officer)
11
<PAGE> 14
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------
FORM 10-Q
QUARTERLY REPORT
UNDER
THE SECURITIES EXCHANGE ACT OF 1934
-------------------------
HIGHWAYMASTER COMMUNICATIONS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
EXHIBITS
================================================================================
<PAGE> 15
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER TITLE
------- -----
<S> <C>
3.1 - Certificate of Incorporation of the Company, as
amended.(1)(9)
3.2 - Amended and Restated By-Laws of the Company.(13)
4.1 - Specimen of certificate representing Common Stock, $.01 par
value, of the Company.(1)
4.2 - Warrant Certificate, dated September 27, 1996, issued to
SBW.(7)
4.3 - Recapitalization Agreement, dated September 27, 1996, by and
among the Company, the Erin Mills Stockholders, the Carlyle
Stockholders and the other persons named therein.(7)
4.4 - Amended and Restated Stockholders' Agreement, dated
September 27, 1996, by and among the Company, SBW, the Erin
Mills Stockholders, the Carlyle Stockholders, the By-Word
Stockholders and the other persons named therein.(7)
4.5 - Indenture dated September 23, 1997 by and among the Company,
HighwayMaster Corporation and Texas Commerce Bank, National
Association.(12)
4.6 - Pledge Agreement dated September 23, 1997 by and among the
Company, Bear, Stearns & Co. Inc. and Smith Barney Inc.(12)
4.7 - Registration Rights Agreement dated September 23, 1997 by
and among the Company, HighwayMaster Corporation, Bear,
Stearns & Co. Inc. and Smith Barney Inc.(12)
4.8 - Warrant Agreement dated September 23, 1997 by and among the
Company, Bear, Stearns & Co. Inc. and Smith Barney Inc.(12)
4.9 - Warrant Registration Rights Agreement dated September 23,
1997 by and among the Company, Bear, Stearns & Co. Inc. and
Smith Barney, Inc.(12)
10.1 - License Agreement, dated April 23, 1992, by and between
Voice Control Systems and the Company (as successor to
By-Word Technologies, Inc.)(1)
10.2 - Agency Agreement, dated February 1, 1993, between the
Company and Saunders, Lubinski & White, Inc.(1)
10.3 - Employment Agreement, dated February 4, 1994, by and between
HighwayMaster Corporation and William C. Kennedy, Jr., as
amended.(1)(5)
10.4 - Employment Agreement, dated February 4, 1994, by and between
HighwayMaster Corporation and William C. Saunders, as
amended.(1)(5)
10.5 - Employment Agreement, dated November 23, 1994, by and
between HighwayMaster Corporation and Gordon D. Quick.(1)(5)
10.6 - Amended and Restated 1994 Stock Option Plan of the Company,
dated February 4, 1994, as amended.(1)(5)(6)
10.7 - Purchase Agreement, dated September 27, 1996, between the
Company and SBW.(7)
10.8 - Mobile Communications (Voice and Data) Services Agreement,
dated as of July 15, 1993, between the Company and EDS
Personal Communications Corporation.(1)(2)
10.9 - Services Agreement, dated March 14, 1995, between the
Company and GTE Telecommunications Services
Incorporated.(1)(2)
10.10 -Services Agreement, dated March 20, 1996, between the
Company and GTE-Mobile Communications Service
Corporation.(3)(4)
10.11 - Agreement, dated June 8, 1994, between the Company and
Truckstops of America, Inc.(1)
</TABLE>
<PAGE> 16
<TABLE>
<S> <C>
10.12 - Amendment dated November 16, 1995 to that certain Mobile
Communications (Voice and Data) Services Agreement, dated as
of July 15, 1993, between the Company and EDS Personal
Communications Corporation.(3)(4)
10.13 - Letter Agreement, dated April 5, 1995, between the Company
and IEX Corporation.(1)
10.14 - Product Development Agreement, dated December 21, 1995,
between the Company and IEX Corporation.(3)(4)
10.15 - Technical Services Agreement, dated September 27, 1996,
between the HM Corporation and SBW.(7)
10.16 - Letter Agreement, dated February 19, 1996, between the
Company and IEX Corporation.(3)
10.17 - Form of Adoption Agreement, Regional Prototype Cash or
Deferred Profit-Sharing Plan and Trust Sponsored by McKay
Hochman Co., Inc., relating to the HighwayMaster Corporation
401(k) Plan.(1)
10.18 - Agreement, dated December 3, 1996, between the Company and
Pickett Racing.(8)
10.19 - Software Transfer Agreement, dated April 25, 1997 between
the Company and Burlington Motor Carriers, Inc.(9)(10)
10.20 - Purchase Agreement dated September 18, 1997 by and among the
Company, HighwayMaster Corporation, Bear, Stearns & Co. Inc.
and Smith Barney Inc.(12)
10.21 - Employment Agreement, dated December 12, 1995, by and
between HighwayMaster Corporation and William McCausland.(13)
27 - Financial Data Schedule.(14)
</TABLE>
- --------------
(1) Filed in connection with the Company's Registration Statement on Form
S-1, as amended (No. 33-91486) effective June 22, 1995.
(2) Certain confidential portions deleted pursuant to Order Granting
Application for Confidential Treatment issued in connection with
Registration Statement on Form S-1 (No. 33-91486) effective June 22,
1995.
(3) Filed in connection with the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1995.
(4) Certain confidential portions deleted pursuant to Application for
Confidential Treatment filed in connection with the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1995.
(5) Indicates management or compensatory plan or arrangement required to
be identified pursuant to Item 14(a)(4).
(6) Filed in connection with the Company's Form 10-Q Quarterly Report for
the quarterly period ended June 30, 1996.
(7) Filed in connection with the Company's Current Report on Form 8-K
filed on October 7, 1996.
(8) Filed in connection with the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1996.
(9) Filed in connection with the Company's Form 10-Q Quarterly Report for
the quarterly period ended March 31, 1997.
(10) Certain confidential portions deleted pursuant to Order Granting
Application for Confidential Treatment issued in connection with the
Company's Form 10-Q Quarterly Report for the quarterly period ended
March 31, 1997.
(11) Filed in connection with the Company's Form 10-Q Quarterly Report for
the quarterly period ended June 30, 1997.
<PAGE> 17
(12) Filed in connection with the Company's Registration Statement on Form
S-4, as amended (No. 333-38361).
(13) Filed in connection with the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1997.
(14) Filed herewith.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 21,962
<SECURITIES> 18,295
<RECEIVABLES> 17,020
<ALLOWANCES> 2,564
<INVENTORY> 4,900
<CURRENT-ASSETS> 77,990
<PP&E> 23,140
<DEPRECIATION> 6,442
<TOTAL-ASSETS> 132,646
<CURRENT-LIABILITIES> 14,879
<BONDS> 121,086
0
0
<COMMON> 252
<OTHER-SE> (3,571)
<TOTAL-LIABILITY-AND-EQUITY> (3,319)
<SALES> 4,627
<TOTAL-REVENUES> 15,723
<CGS> 3,747
<TOTAL-COSTS> 12,462
<OTHER-EXPENSES> 11,752
<LOSS-PROVISION> 415
<INTEREST-EXPENSE> 4,440
<INCOME-PRETAX> (11,589)
<INCOME-TAX> 0
<INCOME-CONTINUING> (11,589)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
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