Stamps.com 2001 Annual Report Download - page 56

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STAMPS.COM INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
7. Property and Equipment
Property and equipment is summarized as follows (in thousands):
2001 2000
-------- --------
Furniture and equipment..................... $ 1,697 $ 4,508
Computers and software...................... 19,702 49,570
Leasehold improvements...................... 1,732 3,544
-------- --------
23,131 57,622
Accumulated depreciation and amortization... (12,055)
(12,037)
-------- --------
$ 11,076 $ 45,585
======== ========
During 2001, 2000 and 1999, depreciation expense including the amortization on equipment under capital leases, was approximately $8.1
million, $10.7 million and $1.3 million respectively.
8. Line of Credit
The Company had a credit line agreement with a financial institution with an initial borrowing base of $300,000, which was increased to $1
million based on the Company's net equity balance, as defined. Borrowings bear interest at the lender's prime rate plus 1% and are
collateralized by certain of the Company's assets. The credit line agreement matured and was paid off on January 31, 2000.
9. Income Taxes
The provision for income taxes consists solely of minimum state taxes. The Company's effective tax rate differs from the statutory federal
income tax rate primarily as a result of the establishment of a valuation allowance for the future benefits to be received from the net operating
loss carryforwards and research tax credit carryforwards. The tax effect of temporary differences that give rise to a significant portion of the
deferred tax assets and liabilities at December 31, 2001 and 2000 are presented below (in thousands).
2001 2000
--------- --------
Deferred tax assets (liabilities):
Net operating loss carryforwards.. $ 98,999 $ 73,924
Research credits.................. 748 748
Depreciation...................... 160
(368)
Capitalized start-up costs........ 1,995 2,766
Accruals.......................... 1,661 4,166
--------- --------
Total deferred tax assets..... 103,563 81,236
Valuation allowance.................. (103,563)
(81,236)
--------- --------
Net deferred tax assets....... $ -- $ --
========= ========
Because the Company is uncertain as to when and if it may realize its deferred tax assets, the Company has placed a valuation allowance against
its otherwise recognizable deferred tax assets.
2002. EDGAR Online, Inc.