EX-99.1 2 v028888_ex99-1.htm
EXHIBIT 99.1
 

CONTACT:
Investor Relations
  201-996-1717
  investors@goamerica.com
 
 
GOAMERICA ANNOUNCES THIRD QUARTER 2005 RESULTS

Merger with Hands On Expected to Close in First Quarter 2006
 
HACKENSACK, NJ, -- November 10, 2005 -- GoAmerica, Inc. (NASDAQ: GOAM) today announced results for the third quarter ended September 30, 2005.
 
Total revenue for the three months ended September 30, 2005 was approximately $2.3 million, compared to total revenue in the previous quarter of approximately $1.9 million and total revenue of approximately $1.4 million in the third quarter of 2004.
 
Net loss for the third quarter was approximately $1 million, or $0.48 per diluted common share, compared with a net loss of $1 million, or $0.49 per diluted common share, during the previous quarter, and a net loss of $1.2 million, or $0.61 per diluted common share, during the third quarter of 2004.
 
As of September 30, 2005, GoAmerica had approximately $5.2 million in cash and cash equivalents, including $300,000 in restricted cash, compared to $6.4 million as of June 30, 2005 and $8.7 million as of September 30, 2004. During the quarter, the Company used approximately $700,000 in cash to fund operating activities. The Company maintains a strong balance sheet consisting of more than $6 million in working capital.
 
During the third quarter, $226,000 in cash was loaned to Hands On for the purchase of capital equipment in accordance with a short-term loan agreement between GoAmerica and Hands On, bringing the total balance of funds loaned to HandsOn to $350,000 as of September 30, 2005. Hands On may borrow up to $1 million against the short-term loan agreement for the purchase of capital equipment and other assets that are intended to strengthen the combined company upon closing of the merger.
 

As previously announced, GoAmerica entered into a merger agreement with Hands On, a leading provider of video relay and interpreter services for the deaf and hard-of-hearing market, and Hands On’s principal shareholders. The merger is subject to shareholder approval of each company, and, although no assurances can be given, is expected to close during the first quarter of 2006.
 
About GoAmerica
 
GoAmerica provides a wide range of wireless, relay and prepaid communications services, customized for people who are deaf, hard of hearing or speech impaired. The Company's vision is to improve the quality of life of its customers by being their premier provider of innovative communication services. For more information on the Company or its services, visit www.goamerica.com or contact GoAmerica directly at TTY 201-527-1520, voice 201-996-1717 or via Internet relay by visiting www.i711.com.

 
Safe Harbor
 
The statements contained in this news release that are not based on historical fact (particularly those concerning what we hope to achieve by the merger with Hands On) are "forward-looking statements" that are made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of forward-looking terminology such as "may," "will," "expect," "estimate," "anticipate," "continue," or similar terms, variations of such terms or the negative of those terms. Such forward-looking statements involve risks and uncertainties, including, but not limited to those of GoAmerica including: (i) our limited operating history; (ii) our ability to successfully manage our relationship with EarthLink; (iii) our dependence on EarthLink to provide billing, customer and technical support to certain of our subscribers; (iv) our ability to respond to the rapid technological change of the wireless data industry and offer new services; (v) our dependence on wireless carrier networks; (vi) our ability to respond to increased competition in the wireless data industry; (vii) our ability to integrate acquired businesses and technologies, including Hands On (if the merger is completed); (viii) our ability to generate revenue growth; (ix) our ability to increase or maintain gross margins, profitability, liquidity and capital resources; (x) difficulties inherent in predicting the outcome of regulatory processes; (xi) our limited experience in offering prepaid calling cards; and (xii) difficulty in predicting the consequences of our entering into a merger agreement with Hands On. Such risks and others are more fully described in the Risk Factors set forth in our filings with the Securities and Exchange Commission. Our actual results could differ materially from the results expressed in, or implied by, such forward-looking statements. GoAmerica is not obligated to update and does not undertake to update any of its forward looking statements made in this press release. Each reference in this news release to "GoAmerica", the "Company" or "We", or any variation thereof, is a reference to GoAmerica, Inc. and its subsidiaries. "GoAmerica" and "WyndTell" are registered trademarks of GoAmerica. "i711", "i711.com", and "Clear Mobile" are trademarks, and "Relay and Beyond" is a service mark of GoAmerica. Other names may be trademarks of their respective owners.
 

 
Additional Information
 
GoAmerica, Inc. plans to file a Registration Statement on SEC Form S-4 in connection with the merger with Hands On and the parties expect to mail a Proxy Statement/Prospectus to their shareholders containing information about the merger. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT AND THE PROXY STATEMENT/PROSPECTUS CAREFULLY WHEN THEY ARE AVAILABLE. THE REGISTRATION STATEMENT AND THE PROXY STATEMENT/PROSPECTUS WILL CONTAIN IMPORTANT INFORMATION ABOUT GOAMERICA, HANDS ON, THE MERGER AND RELATED MATTERS. Investors and security holders will be able to obtain free copies of these documents through the web site maintained by the U.S. Securities and Exchange Commission at http//www.sec.gov. In addition to the Registration Statement and the Proxy Statement/Prospectus, GoAmerica files annual, quarterly and special reports, proxy statements and other information with the Securities and Exchange Commission. You may read and copy any reports, statements and other information filed by GoAmerica at the SEC public reference room at 450 Fifth Street, N.W., Washington, D.C. 20549 or at the SEC's other public reference rooms. Please call the SEC at 1-800-SEC-0330 for further information on public reference rooms. GoAmerica's filings with the SEC also are available to the public at the web site maintained by the SEC at http//www.sec.gov. Hands On, its directors, executive officers and certain members of management and employees may be soliciting proxies from Hands On's shareholders in favor of the adoption of the merger and the merger agreement. GoAmerica, its directors, executive officers, and certain members of management and employees may be soliciting proxies from GoAmerica's shareholders to authorize the issuance of the shares of GoAmerica common stock issuable pursuant to the merger agreement. A description of any interests that Hands On's directors and executive officers, or that GoAmerica's directors and executive officers, have in the merger will be available in the Proxy Statement/Prospectus. This press release does not constitute an offer of any securities for sale.


 
GOAMERICA, INC.
 
CONDENSED CONSOLIDATED BALANCE SHEETS
 
(In thousands)

   
September 30,
2005
 
December 31,
2004
 
   
(Unaudited)
     
Assets
         
Current assets:
         
Cash and cash equivalents.
 
$
4,937
 
$
7,098
 
Accounts receivable, net.
   
1,560
   
1,530
 
Other receivables.
   
--
   
732
 
Merchandise inventories, net.
   
334
   
123
 
Prepaid expenses and other current assets.
   
356
   
219
 
Total current assets.
   
7,187
   
9,702
 
               
Other assets.
   
7,721
   
8,284
 
Total assets 
 
$
14,908
 
$
17,986
 
               
Liabilities and stockholders' equity
             
Current liabilities:
             
Accounts payable.
 
$
670
 
$
348
 
Accrued expenses.
   
336
   
538
 
Deferred revenue.
   
86
   
285
 
Other current liabilities.
   
37
   
1
 
Total current liabilities.
   
1,129
   
1,172
 
Stockholders' equity .
   
13,779
   
16,814
 
   
$
14,908
 
$
17,986
 



GOAMERICA, INC.
 
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
 
(Unaudited)
 
   
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
   
2005
 
2004
 
2005
 
2004
 
Revenues:
                 
Subscriber
 
$
548
 
$
1,207
 
$
1,967
 
$
4,596
 
Prepaid services
   
1,027
   
--
   
2,452
   
--
 
Relay services
   
329
   
--
   
774
   
--
 
Equipment
   
120
   
50
   
361
   
156
 
Other
   
270
   
113
   
676
   
163
 
     
2,294
   
1,370
   
6,230
   
4,915
 
Costs and expenses:
                         
Cost of subscriber airtime
   
208
   
510
   
727
   
2,117
 
Cost of network operations
   
78
   
132
   
243
   
580
 
Cost of equipment revenue
   
138
   
35
   
436
   
149
 
Cost of prepaid services
   
1,252
   
--
   
2,663
   
--
 
Cost of other revenue
   
--
   
56
   
--
   
56
 
Sales and marketing
   
320
   
165
   
773
   
543
 
General and administrative
   
984
   
1,220
   
3,336
   
4,050
 
Research and development
   
96
   
126
   
255
   
434
 
Depreciation and amortization
   
119
   
168
   
375
   
664
 
Amortization of other intangibles
   
122
   
99
   
564
   
534
 
     
3,317
   
2,511
   
9,372
   
9,127
 
Loss from operations 
   
(1,023
)
 
(1,141
)
 
(3,142
)
 
(4,212
)
                           
Other income (expense):
                         
Settlement gains (losses), nett
   
--
   
(140
)
 
--
   
1,481
 
Interest income (expense), net
   
29
   
38
   
105
   
(991
)
                           
Total other income (expense), net
   
29
   
(102
)
 
105
   
490
 
                           
Net loss
 
$
(994
)
$
(1,243
)
$
(3,037
)
$
(3,722
)
                           
Basic net loss per share
 
$
(0.48
)
$
(0.61
)
$
(1.45
)
$
(2.19
)
Diluted net loss per share
 
$
(0.48
)
$
(0.61
)
$
(1.45
)
$
(2.19
)
Weighted average shares used in computation of basic net loss per share
   
2,093,451
   
2,040,603
   
2,093,445
   
1,695,766
 
Weighted average shares used in computation of diluted net loss per share
   
2,093,451
   
2,040,603
   
2,093,445
   
1,695,766