<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K/A
Amendment No. 1
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
--- EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED JUNE 30, 1998.
--- TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934.
Commission File Number: 0-26858
BLUE WAVE SYSTEMS INC.
(Exact name of registrant as specified in its charter)
DELAWARE 41-1425902
(State or other jurisdiction of (I. R. S. Employer
incorporation or organization) Identification Number)
2410 LUNA ROAD, CARROLLTON, TX 75006
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (972) 277-4600
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Name of each exchange
Title of each class on which registered
------------------- ---------------------
None None
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
COMMON STOCK, $0.01 PAR VALUE
(Title of Class)
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 by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
The aggregate market value of the voting stock held by non-affiliates of the
Registrant, based upon the closing sale price of the Common Stock on September
23, 1998 as reported on the Nasdaq National Market, was approximately
$31,320,000.
As of September 23, 1998, Registrant had outstanding 13,014,038 shares of Common
Stock.
DOCUMENTS INCORPORATED BY REFERENCE
None.
<PAGE>
PART II
Item 6 of the registrant's Form 10-K previously filed on September 28, 1998 is
hereby amended as follows:
Working capital in 1998 is restated to be $6,202 instead of $6,401.
Item 7 of the registrant's Form 10-K previously filed on September 28, 1998 is
hereby amended as follows:
The last sentence of the General and Administrative caption, page 14, which
references "fiscal 1998" is restated as "fiscal 1999".
The net working capital for 1998 in the Liquidity and Capital Resources
section, page 15, is restated to be $6,202,000.
Part III
Item 10 of the registrant's Form 10-K previously filed on September 28, 1998 is
hereby amended to add the following:
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under the securities laws of the United States, the Company's directors and
executive officers and persons who own more than 10% of the Company's common
stock are required to report their initial ownership of the Company's common
stock and any subsequent changes in that ownership to the Securities and
Exchange Commission. Specific due dates have been established for these
reports, and the Company is required to disclose any failure to file by these
dates. All of these filing requirements were satisfied during fiscal 1998.
Items 11 through 13 of the registrant's Form 10-K previously filed on
September 28, 1998 are hereby amended to read in their entirety as follows:
2
<PAGE>
ITEM 11. EXECUTIVE COMPENSATION
SUMMARY OF EXECUTIVE COMPENSATION
The following table sets forth information concerning cash compensation
paid or accrued by the Company during the three years ended June 30, 1998 to or
for the Company's chief executive officer and the four other highest compensated
executive officers of the Company whose total salary and bonus exceeded
$100,000.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
------------------- ------
SECURITIES
FISCAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS COMPENSATION (1)
- --------------------------- ---- ------ ----- ------- ----------------
<S> <C> <C> <C> <C> <C>
Simon Yates, President and Chief 1998 $132,000 $ -- -- $ 23,100
Executive Officer (2)
Sam K. Smith, Chairman of the 1998 -- -- -- 168,750
Board of Directors, former 1997 -- -- -- --
Interim President and Chief
Executive Officer (3)
John L. Marshall, former Senior 1998 124,859 -- -- 1,489
Vice President, Sales (4) 1997 118,893 680 -- 824
1996 112,949 -- -- --
John W. Clark, Vice President 1998 112,708 -- -- --
Engineering (5) 1997 95,503 214 57,500 --
Charles D. Brockenbush, Vice 1998 107,056 -- -- 1,235
President Finance and Chief 1997 102,941 440 15,000 713
Financial Officer (6) 1996 42,308 -- 35,000 --
Joseph E. Andrulis, Vice 1998 106,892 -- -- 1,140
President Marketing (7) 1997 100,000 573 25,000 692
1996 9,615 -- 50,000 --
</TABLE>
(1) Amounts indicated reflect the Company's contributions under its 401(k)
savings plan for Messrs. Marshall, Clark, Brockenbush and Andrulis. The
amount indicated for Mr. Yates reflects compensation for his
responsibilities while acting as a director of LSI, automobile-related
expenses for an auto provided to him by BWS Ltd., and private healthcare.
The amount indicated for Mr. Smith represents consulting fees paid to him
for the services provided when he was acting as Interim Chief Executive
Officer.
(2) Mr. Yates was appointed to his position with the Company on April 27, 1998,
upon completion of the combination between Mizar, Inc. and Loughborough
Sound Images Ltd. The amounts in the above table include the compensation
received by Mr. Yates while he was an officer of LSI as well as the
compensation received as CEO of the Company.
(3) Mr. Smith was appointed Interim Chief Executive Officer in June 1997, and
served in this capacity until the completion of the combination on April
27, 1998.
(4) Mr. Marshall resigned from the Company effective August 31, 1998.
(5) Mr. Clark joined the Company in July 1996.
(6) Mr. Brockenbush joined the Company in January 1996.
(7) Mr. Andrulis joined the Company in May 1996.
Except for Mr. Yates, none of the named executive officers received
perquisites and other personal benefits or property in excess of the lesser of
$50,000 or 10% of such officer's total annual salary or bonus.
3
<PAGE>
STOCK OPTIONS
There were no stock options granted to the named executive officers during
the fiscal year ended June 30, 1998.
The following table sets forth certain information with respect to the
options exercised by the executive officers named in the above compensation
table during the fiscal year ended June 30, 1998 or held by such persons at June
30, 1998:
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
SHARES NUMBER OF UNEXERCISED IN-THE-MONEY OPTIONS
ACQUIRED OPTIONS AT AT
ON VALUE JUNE 30, 1998 JUNE 30, 1998 (1)
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- -------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mr. Yates 358,655 $134,242 87,534 -- $272,231 $ --
Mr. Smith -- -- 42,500 -- 115,500 --
Mr. Marshall 95,200 69,530 -- 23,800 -- 64,680
Mr. Clark -- -- 10,625 46,875 -- --
Mr. Brockenbush -- -- 17,500 32,500 -- --
Mr. Andrulis -- -- 25,000 50,000 -- --
</TABLE>
(1) Based upon the closing price of the common stock of the Company on June 30,
1998, which price was $3.50 per share.
DIRECTOR COMPENSATION
The Company does not pay any annual retainer or per meeting fees to its
directors, other than to Mr. John Forrest, who also served as an outside
director of LSI. Mr. Forrest is compensated at a rate of approximately $33,000
annually. The Company reimburses all of the directors for their out-of-pocket
expenses in connection with performing their duties as directors of the Company.
In addition, each non-employee director is granted options under the Directors'
Stock Option Plan to purchase shares of common stock. In November 1997, Mr.
Rynearson and a former director, David Irwin, each received a grant under this
plan of 8,500 immediately vested options at an exercise price of $6.06 per
share.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Prior to the combination, the Compensation Committee of the
Company's Board of Directors consisted of Mr. Sam Smith, who was appointed as
Interim Chief Executive Officer of the Company on June 30, 1997, and Mr. David
Irwin, until his resignation from his position as a director in February 1998.
Although the Company paid consultancy fees to Mr. Smith for his role as Interim
Chief Executive Officer, he was not at any time during the fiscal year ended
June 30, 1998, an employee of the Company. Upon completion of the combination
between Mizar and LSI, Mr. Forrest, Mr. Smith, and Mr. Rynearson were appointed
as members of the Compensation Committee. Messrs. Forrest, Rynearson and Irwin
were not at any time during the fiscal year ended June 30, 1998, officers or
employees of the Company. During fiscal 1998, no executive officer of the
Company served as a member of the board of directors or compensation committee
of any entity which has one or more executive officers serving as a member of
the Company's Board of Directors or Compensation Committee.
EMPLOYMENT AGREEMENTS
Certain officers of the Company, including Mr. Yates, have entered into
employment contracts with the Company. These agreements define, among other
items, the terms of employment, remuneration, and notice periods for
termination.
David Irwin, former President and CEO of the Company, who resigned in June
1997, had an employment agreement that provided for one year of compensation for
termination under certain circumstances. The Company accrued approximately
$250,000 in the fiscal year ended 1997, related to Mr. Irwin's resignation from
the aforementioned positions. Mr. Irwin served as a director of the Company
until his resignation from that position in February 1998.
4
<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth certain information as to the beneficial
ownership of the Company's common stock as of September 23, 1998 by (i) each
person who is known to beneficially own more than 5% of each such class, (ii)
each director of the Company, (iii) certain named executive officers and (iv)
all officers and directors as a group. Except pursuant to applicable community
property laws and except as otherwise indicated, each stockholder identified in
the table possesses sole voting and investment power with respect to its or his
shares.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED (1)
-----------------------------
NAME NUMBER PERCENT
- ---- ------ -------
<S> <C> <C>
DIRECTORS AND EXECUTIVE OFFICERS:
Simon Yates (2) 2,561,402 19.6%
Rob N. Shaddock (3) 693,366 5.3
John L. Rynearson (4) 418,500 3.2
Kevin Parslow (5) 446,565 3.4
Sam K. Smith (6) 66,500 *
Julian S. Jenkins 62,740 *
Joseph E. Andrulis 31,250 *
Charles D. Brockenbush 27,250 *
John R. Forrest (7) 18,926 *
M. Keith Burgess 13,430 *
Andy N. MacCaig -- *
All directors and officers as a group (11 individuals) 4,339,929 31.7
MORE THAN 5% STOCKHOLDERS:
Boston Holdings Limited (2) 1,903,616 14.6
Dr. G. M. Duck (8) 1,746,811 13.4
David J. Quarmby (9) 1,519,126 11.7
Heartland Advisors, Inc. (10) 1,432,200 11.0
David H. Irwin (11) 769,386 5.9
</TABLE>
* Less than one percent.
(1) Includes shares issuable upon exercise of stock options which will be
vested prior to November 22, 1998.
(2) The shares for which Boston Holdings Limited is listed as the beneficial
owner are held under a voting trust agreement, pursuant to which Mr. Yates
is the trustee. The 1,903,616 shares are included in the total shares owned
by Mr. Yates. Mr. Yates disclaims beneficial ownership of such shares. The
address of Boston Holdings Limited is 39 Victoria Street, London SW1H OED,
England.
(3) Includes 84,601 shares owned by his spouse, Shelley M. Shaddock and 98,038
shares held in trust for the benefit of Mr. Shaddock. Mr. Parslow is one of
the two trustees of this trust. Also includes 52,520 shares held as one of
the two trustees of a trust for the benefit of Mr. Parslow.
(4) Mr. Rynearson's address is 6221 E. Pershing Avenue, Scottsdale, Arizona
85254.
(5) Includes 52,520 shares held in trust for the benefit of Mr. Parslow. Mr.
Shaddock is one of the two trustees of this trust. Also includes 98,038
shares held as one of the two trustees of a trust for the benefit of Mr.
Shaddock.
(6) Mr. Smith's address is 6811 Midcrest, Dallas, Texas, 75240.
(7) Mr. Forrest's address is The Old Town House, Balmer Lawn Road, Brokenhurst,
Hampshire SO42 7TS, England.
(8) The address of Dr. Duck is St. Anne's House, St. Anne's Lane, Sutton
Bonington, Loughborough, Leicestershire LE12 5NJ, England. Includes 83,465
shares held by Dr. Duck as trustee for the G. M. Duck Children's Settlement
Trust and 101,445 shares beneficially owned by his spouse, E. A. Duck.
(9) The address of Mr. Quarmby is 16 Mayfield Terrace, Edinburgh EH9 1SA,
Scotland. Includes 123,021 shares beneficially owned by his spouse, Rhoda
Mary Quarmby, of which 94,632 shares are held as trustee for the Quarmby
Family Settlement Account.
(10) Based on information contained in Schedule 13G dated as of June 10, 1998.
The shares of common stock indicated are held in investment advisory
accounts. As a result, various persons have the right to receive or the
power to direct the receipt of dividends from, or the proceeds from the
sale of, the securities. The address of Heartland Advisors, Inc. is 790
North Milwaukee Street, Milwaukee, Wisconsin 53202.
(11) Includes 78,000 shares owned by trusts for the benefit of Mr. Irwin's
children. Mr. Irwin disclaims beneficial ownership of such shares. Mr.
Irwin's address is 18815 Heathcote Drive, Deephaven, Minnesota 55391.
5
<PAGE>
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The Board of Directors of the Company authorized a Stock Repurchase Plan in
May 1997. On August 18, 1997 the Company repurchased 70,500 shares from Mr.
Marshall at $4.125 per share for a total consideration of approximately
$290,800.
See also Item 11 - "Employment Agreements" for a description of employment
agreements the Company has entered into with certain of its executive officers.
PART IV
Item 14 of the registrant's Form 10-K previously filed on September 28, 1998 is
hereby amended as follows:
Index to Consolidated Financial Statements (page F-1):
"Report of Independent Accountants", page F-23, has been added.
Report of Independent Public Accountants (page F-2):
The next to the last sentence in the first paragraph of this report is
restated as follows. The changes are underlined.
These consolidated financial statements and Supplemental Schedule II are
----------------------------
the responsibility of the Company's management.
Consolidated Balance Sheets (page F-3):
The following items have been restated as shown below:
As Restated As Reported
----------- -----------
Current assets:
Deferred tax asset $ 903 $ 1,101
Total current assets 15,603 15,801
Deferred tax asset noncurrent 478 280
3. Inventories (page F-12):
The following amounts for fiscal 1997 have been restated as shown below (in
thousands):
As Restated As Reported
----------- -----------
Raw Materials $ 2,463 $ 2,047
Work-in-process 1,828 1,729
Finished goods 1,379 826
Reserves (1,068) --
------- -------
Inventories, net $ 4,602 $ 4,602
======= =======
8. Income Per Share (page F-14):
The first sentence in the third paragraph of this note is restated as follows.
The changes are underlined.
Dilutive securities equivalent to 990,000 and 1,199,000 shares of common
------- ---------
stock were outstanding during 1998 and 1997, respectively, but were not included
in the computation of diluted EPS because the Company incurred net losses
attributable to common shareholders.
6
<PAGE>
13. Employee Benefit Plans (page F-16):
The fourth sentence of the second paragraph under the caption "Stock Option
Plan" has been amended, and the changes underlined, as follows:
The Company's proforma net (loss) income applicable to common stock for
--------------------------
fiscal 1998, 1997 and 1996 would have been $(11,704,000), $(1,961,000) and
------------
$3,557,000, respectively, resulting in diluted earnings (loss) per share of
$(0.92), $(0.19) and $0.29, respectively.
14. Income Taxes: (pages F-18 through F-19):
The first sentence of the first paragraph of this note is restated, and changes
underlined, as follows:
At fiscal year-end 1998, Blue Wave had federal and foreign net operating
-------------------
loss (NOL) carryforwards of approximately $8,300,000 and $2,000,000,
-----------
respectively, which begin to expire in 2002.
- -------------
Portions of the table of the components of income tax provisions on page F-18
have been restated and the table is shown in its entirety below (in thousands):
1998 1997 1996
---- ---- ----
CONTINUING OPERATIONS:
State-
Current $ 31 $ 70 $ 63
Deferred -- -- 108
Federal-
Current -- 557 1,033
Deferred (797) (182) (123)
Foreign-
Current 224 -- --
Deferred (96) -- --
Increase (decrease) in valuation allowance 893 (48) (790)
----- ----- ------
Provision for income taxes 255 397 291
DISCONTINUED OPERATIONS - Foreign current (62) (560) (661)
----- ----- ------
$ 193 $(163) $ (370)
===== ===== ======
The following is added to Note 14 below the above table:
The U. S. and foreign components of income (loss) from continuing
operations before income taxes are as follows (in thousands):
1998 1997 1996
---- ---- ----
U. S. $(5,646) $211 $2,767
Foreign (3,904) 478 2,488
------- ---- ------
Income (loss) from continuing operations $(9,550) $689 $5,255
======= ==== ======
7
<PAGE>
The table of the net deferred tax assets (liabilities) on page F-19 has
been restated and is shown in its entirety below (in thousands):
1998 Change 1997
---- ------ ----
DEFERRED TAX ASSET:
Current-
Merger related reserves $ 291 $ 291 $ --
Accruals/reserves 408 112 296
UCC adjustments -- (7) 7
Other 204 (132) 336
Noncurrent-
Accruals/reserves -- (74) 74
Depreciation 71 21 50
Disqualifying dispositions -- (263) 263
Net operating losses 3,505 1,151 2,354
Other -- (26) 26
------- ------ -------
4,479 1,073 3,406
Valuation allowance (3,098) (893) (2,205)
------- ------ -------
$ 1,381 $ 180 $ 1,201
------- ------ -------
DEFERRED TAX LIABILITY:
Current-
Current deferred gain -- 58 (58)
Noncurrent-
Noncurrent depreciation (870) (238) (632)
------- ------ -------
$ (870) $ (180) $ (690)
------- ------ -------
Net deferred tax asset $ 511 $ -- $ 511
======= ====== =======
16. Quarterly Financial Information (page F-21):
The amounts for gross margin, net income (loss) applicable to common stock, and
diluted net income (loss) per share for the quarters ended September 30, 1996,
December 31, 1996 and March 31, 1997, have been restated. The entire fiscal 1997
information, including the aforementioned revisions, is shown in its entirety
below (in thousands, except net income (loss) per share):
<TABLE>
<CAPTION>
Three months Ended
September 30, December 31, March 31, June 30,
1996 1996 1997 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales $8,374 $8,742 $ 8,145 $9,973
Gross margin 4,537 4,706 4,400 5,863
Income (loss) from continuing operations before
Provision (benefit) for income taxes 566 764 (709) 927
Net income (loss) applicable to common stock 393 9 (1,253) 188
Diluted net income (loss) per share $ .03 $ -- $ (0.12) $ 0.02
</TABLE>
Schedule II, Valuation and Qualifying Accounts (page F-22):
The allowances for excess and obsolete inventory have been revised as shown
below (in thousands):
Balance at Charged to Costs Balance at End of
Beginning of Period and Expenses Deductions Period
------------------- ------------ ---------- ------
1996 $ 259 $ 413 $(158) $ 514
1997 514 1,007 (453) 1,068
1998 1,068 1,092 (546) 1,614
The following footnote is added in its entirety to describe the $(6,086)
deduction in 1998 in the merger and realignment expenses:
Includes a $2,700,000 non-cash charge related to variable stock
options of LSI, other non-cash charges of $1,600,000 and cash
payments of $2,700,000 made in fiscal year 1998.
8
<PAGE>
Report of Independent Accountants has been added as shown below
(page F-23):
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders
of Loughborough Sound Images Limited
In our opinion, the consolidated balance sheet and the related consolidated
statements of operations, of changes in shareholders' deficit and of cash flows
present fairly, in all material respects, the financial position of Loughborough
Sound Images Limited and its subsidiaries at September 30, 1997 and the results
of their operations and their cash flows for each of the two years in the period
ended September 30, 1997, in conformity with accounting principles generally
accepted in the United States. These financial statements (not presented
separately herein) are the responsibility of the Company's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States which require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for the opinion expressed above. We have not audited the consolidated financial
statements of Loughborough Sound Images Limited and its subsidiaries for any
period subsequent to September 30, 1997.
PRICEWATERHOUSECOOPERS
Leicester, England
December 9, 1997
9
<PAGE>
The Exhibit Index is amended for the following items:
Exhibit 23, Consent of Arthur Andersen, LLP is amended to be Exhibit 23.1.
Exhibit 23.2, Consent of PricewaterhouseCoopers is added to the Exhibit Index
and is filed herewith.
Consent of Independent Public Accountants, Exhibit 23:
The number of this exhibit has been changed from 23 to 23.1.
The date of this exhibit has been changed to October 28, 1998.
Consent of Independent Accountants, Exhibit 23.2:
Exhibit 23.2 is added in its entirety.
10
<PAGE>
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this Form 10-K/A to be
signed on its behalf by the undersigned, thereunto duly authorized, on October
28, 1998.
Blue Wave Systems Inc.
By: /s/ Charles D. Brockenbush
--------------------------------------------
Charles D. Brockenbush, Vice President,
Finance and Chief Financial Officer
(Principal Financial and Accounting Officer)
11
<PAGE>
Exhibit 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 No. 333-430 of Blue Wave Systems Inc. of our report dated
December 9, 1997 relating to the consolidated financial statements of
Loughborough Sound Images Limited (n/k/a Blue Wave Systems Ltd.) appearing in
this Form 10-K/A.
PRICEWATERHOUSECOOPERS
Leicester, England
October 28, 1998
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF BLUE WAVE SYSTEMS INC. AS OF JUNE 30, 1998 AND FOR THE
TWELVE MONTHS THEN ENDED, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<RESTATED>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-01-1997
<PERIOD-END> JUN-30-1998
<CASH> 1,895
<SECURITIES> 3,062
<RECEIVABLES> 5,311
<ALLOWANCES> 336
<INVENTORY> 4,156
<CURRENT-ASSETS> 15,603
<PP&E> 10,196
<DEPRECIATION> 5,838
<TOTAL-ASSETS> 20,544
<CURRENT-LIABILITIES> 9,401
<BONDS> 0
0
0
<COMMON> 135
<OTHER-SE> 9,303
<TOTAL-LIABILITY-AND-EQUITY> 20,544
<SALES> 32,679
<TOTAL-REVENUES> 32,679
<CGS> 15,395
<TOTAL-COSTS> 15,395
<OTHER-EXPENSES> 27,420
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 109
<INCOME-PRETAX> (9,550)
<INCOME-TAX> 255
<INCOME-CONTINUING> (9,805)
<DISCONTINUED> (137)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (11,454)
<EPS-PRIMARY> (0.90)
<EPS-DILUTED> (0.90)
</TABLE>
