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Technology Stocks : General Magic -- Ignore unavailable to you. Want to Upgrade?

To: redbird who wrote (2091)	6/1/1998 3:21:00 AM
From: Mark Oliver	Respond to of 10081

It's after 11pm and I'm reading reports from Edgar. It's a bit confusing, but probably a necessary evil. Can anyone clarify who the original investing companies were in GMGC and what the story was about being paid back for royalties? I understand the company was formed to do a different job than what it is currently promoting; ie Magic Cap hand helds vs Portico. The first endeavor was a failure and now they have to pay investors back. The annual report talks about 5 companies, but the Edgar report talks about 8 stockholders. The annual report seems to indicate one company took it's payment in the form of rights to a software modem technology, which seems to be related to Altocom or maybe Altocom just paying off the money owed? It's described on page 18 paragraph 7. The SEC report says the following. In connection with its initial strategy, the Company entered into Magic Cap master license agreements with eight of its stockholders. The Company has satisfied its obligations under five of these agreements, and is subject to the following obligations under the remaining three agreements. The Company must refund to one licensee a prepaid royalty, together with interest, which totaled $2.6 million as of March 31, 1998. This amount will be paid upon demand, and was classified in accrued expenses as of March 31, 1998. The Company has agreed to refund a second licensee the amount of a $1.5 million unrecouped prepaid royalty. The refund is secured by a license in certain of the Company's intellectual property, is non-interest bearing and is payable in August 1999. The amount of this refund was classified in other long-term liabilities as of March 31, 1998. Finally, the Company has agreed to refund the third licensee any amount of a $2.0 million prepaid royalty not recouped by January 1, 2003, plus accrued interest. The amount of any such refund is payable on or before December 31, 2003. As of March 31, 1998, this obligation was classified in deferred revenue, noncurrent. There can be no assurance that the third such licensee will develop products that incorporate the Company's Magic Cap technology. Therefore, it is uncertain when prepaid royalties currently classified as noncurrent deferred revenue will be recognized as licensing revenue or if they will be fully recouped. I don't think I'm making sense. The point is to try to better understand the past relationships and obligations to know what will happen going forward. Also, there's lots of interesting stuff about how much Microsoft pays for their 12% of the company, and a deal with Halifax for another large stake held via convertible stock. Both these companies got really great deals. Sure seems to indicate a lot of risk that GMGC was willing to give it away for these prices. Who's the company providing services and is it important? In April 1998, the Company entered into an agreement to purchase telecommunications services at fixed prices for an initial term of three years. The Company is obligated to purchase $13.0 million in telecommunications services during the three-year period ending April 30, 2001. Well, that's enough for me. It's even later now. If anyone can add anything about these relationships, I'd love to know more. Regards, Mark Here's a link to the SEC for via edgar. edgar.sec.gov