ACTM $100 Million Cable Modem Contract with MOT Message Board

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Technology Stocks : ACTM $100 Million Cable Modem Contract with MOT

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To: kolo55 who wrote (572)	3/6/1998 11:07:00 AM
From: kolo55	Read Replies (1) of 1250

I guess I'll try and answer my own question. My previous comments: I'm having a difficult time reconciling the statements made in the 10Q with the balance sheet info. It looks to me like the company has 36.8M + 9.7M = 46.5M in debt but only shows $37.6M on the balance sheet. Anyone have an explanation ? The $9.7M is an equipment lease agreement where ACT doesn't own the equipment and is simply paying a lease payment. At the conclusion of the lease, ACT probably has an option to buy the equipment(at a reduced price from original cost). The value of the equipment doesn't show up in the Plant and Equipment line on the balance sheet, and therefore there shouldn't be a corresponding liability shown on the balance sheet. However ACT does have to report the lease agreement in the 10Q because it is a significant financial commitment. As for listing a revolving credit line as 'Long Term Debt', I guess it depends on the terms of the credit line. After going over and over the available financials, I can't really see anything unusual from the info we have access to. I'm trying to keep an unbiased mind so that I can make good decisions, especially with all the rumors floating around. One thing though; this had better be resolved in time to issue the year end report by the end of March, and stay in compliance with SEC regs, or else... Paul

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