##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
 For the quarterly period ended September 30, 2006
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For
the transition period from
                         to
 Commission file number: 000-52076
 OMNITURE, INC.
 (Exact name of Registrant as specified in its charter)
 Delaware
(State or other jurisdiction of 
incorporation or organization)
    
    87-0619936
(IRS Employer
Identification No.)
 550 East Timpanogos Circle
Orem, Utah 84097
(Address, including zip code, of Registrants principal executive offices)
 801.722.7000
(Registrants telephone number, including area code)
 þ o
  o o þ
 o þ




---



##### 



OMNITURE, INC.
Form 10-Q for the Quarter Ended September 30, 2006
 Table of Contents
 Page No.Part I. Financial InformationItem 1. Financial StatementsCondensed Consolidated Balance Sheets
    
    
    1Condensed Consolidated Statements of Operations
    
    
    2Condensed Consolidated Statements of Cash Flows
    
    
    3Notes to Condensed Consolidated Financial Statements
    
    
    4Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    17Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    31Item 4. Controls and Procedures
    
    
    32Part II. Other InformationItem 1. Legal Proceedings
    
    
    33Item 1A. Risk Factors
    
    
    33Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    47Item 3. Defaults Upon Senior Securities
    
    
    48Item 4. Submission of Matters to a Vote of Security Holders
    
    
    48Item 5. Other Information
    
    
    48Item 6. Exhibits
    
    
    49SIGNATURES
    
    
    51EXHIBIT INDEX
    
    
    52




---



##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. Condensed Consolidated Financial Statements
 OMNITURE, INC.
 
 Condensed Consolidated Balance Sheets
(in thousands)
 December 31,
    
    
    September 30,2005
    
    
    2006(unaudited)Assets:Current assets:Cash and cash equivalents
    
    $
    22,196
    
    
    $
    67,813Accounts receivable, net of allowances of $962 and $1,475 at
December 31, 2005 and September 30, 2006, respectively
    
    
    12,325
    
    
    
    21,548Prepaid expenses and other current assets
    
    
    720
    
    
    
    1,616Total current assets
    
    
    35,241
    
    
    
    90,977Property and equipment, net
    
    
    27,517
    
    
    
    33,064Intangible assets, net
    
    
    10,150
    
    
    
    10,247Other assets
    
    
    143
    
    
    
    350Total assets
    
    $
    73,051
    
    
    $
    134,638Liabilities, Convertible Preferred Stock and Stockholders (Deficit) Equity:Current liabilities:Accounts payable
    
    $
    4,081
    
    
    $
    2,872Accrued liabilities
    
    
    13,993
    
    
    
    11,567Current portion of deferred revenues
    
    
    12,855
    
    
    
    19,058Current portion of notes payable
    
    
    3,035
    
    
    
    6,120Current portion of capital lease obligations
    
    
    86
    
    
    
    65Total current liabilities
    
    
    34,050
    
    
    
    39,682Deferred revenues, less current portion
    
    
    396
    
    
    
    1,880Notes payable, less current portion
    
    
    2,794
    
    
    
    5,553Capital lease obligations, less current portion
    
    
    77
    
    
    
    35Other liabilities
    
    
    4,118
    
    
    
    1,361Commitments and contingenciesConvertible preferred stock
    
    
    61,882
    
    
    
    Stockholders (deficit) equity:Common stock
    
    
    14
    
    
    
    47Additional paid-in capital
    
    
    4,104
    
    
    
    126,592Deferred stock-based compensation
    
    
    (3,270
    )
    
    
    (2,439
    )Accumulated other comprehensive income
    
    
    
    
    
    
    3Accumulated deficit
    
    
    (31,114
    )
    
    
    (38,076
    )Total stockholders (deficit) equity
    
    
    (30,266
    )
    
    
    86,127Total liabilities, convertible preferred stock and stockholders (deficit) equity
    
    $
    73,051
    
    
    $
    134,638
 See accompanying notes to the condensed consolidated financial statements.
 1




---



##### Table of Contents



OMNITURE, INC.
 
 Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
 Three Months
    
    
    Nine MonthsEnded September 30,
    
    
    Ended September 30,2005
    
    
    2006
    
    
    2005
    
    
    2006Revenues:Subscription
    
    $
    11,136
    
    
    $
    19,535
    
    
    $
    28,112
    
    
    $
    52,673Professional services and other
    
    
    378
    
    
    
    1,493
    
    
    
    945
    
    
    
    3,615Total revenues
    
    
    11,514
    
    
    
    21,028
    
    
    
    29,057
    
    
    
    56,288Cost of revenues:Subscription
    
    
    4,476
    
    
    
    7,721
    
    
    
    11,426
    
    
    
    20,632Professional services and other
    
    
    510
    
    
    
    778
    
    
    
    1,390
    
    
    
    2,206Total cost of revenues
    
    
    4,986
    
    
    
    8,499
    
    
    
    12,816
    
    
    
    22,838Gross profit
    
    
    6,528
    
    
    
    12,529
    
    
    
    16,241
    
    
    
    33,450Operating expenses:Sales and marketing
    
    
    6,542
    
    
    
    8,847
    
    
    
    17,318
    
    
    
    25,633Research and development
    
    
    2,007
    
    
    
    2,284
    
    
    
    4,771
    
    
    
    6,332General and administrative
    
    
    1,841
    
    
    
    3,078
    
    
    
    4,228
    
    
    
    8,496Total operating expenses
    
    
    10,390
    
    
    
    14,209
    
    
    
    26,317
    
    
    
    40,461Loss from operations
    
    
    (3,862
    )
    
    
    (1,680
    )
    
    
    (10,076
    )
    
    
    (7,011
    )Interest income
    
    
    250
    
    
    
    861
    
    
    
    353
    
    
    
    1,233Interest expense
    
    
    (188
    )
    
    
    (368
    )
    
    
    (485
    )
    
    
    (985
    )Other expense
    
    
    (20
    )
    
    
    (22
    )
    
    
    (32
    )
    
    
    (84
    )Loss before provision for income taxes
    
    
    (3,820
    )
    
    
    (1,209
    )
    
    
    (10,240
    )
    
    
    (6,847
    )Provision for income taxes
    
    
    
    
    
    
    64
    
    
    
    
    
    
    
    115Net loss
    
    $
    (3,820
    )
    
    $
    (1,273
    )
    
    $
    (10,240
    )
    
    $
    (6,962
    )Basic and diluted net loss per share
    
    $
    (0.28
    )
    
    $
    (0.03
    )
    
    $
    (0.75
    )
    
    $
    (0.28
    )Weighted-average number of shares, basic and diluted
    
    
    13,797
    
    
    
    45,850
    
    
    
    13,629
    
    
    
    24,662
 See accompanying notes to the condensed consolidated financial statements.
 2




---



##### Table of Contents



OMNITURE, INC.
 
 Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
 Nine MonthsEnded September 30,2005
    
    
    2006Cash flows from operating activities:Net loss
    
    $
    (10,240
    )
    
    $
    (6,962
    )Adjustments to reconcile net loss to net cash used in operating activities:Depreciation and amortization
    
    
    4,359
    
    
    
    9,404Stock-based compensation
    
    
    259
    
    
    
    2,117Loss on disposal of property and equipment
    
    
    5
    
    
    
    Net changes in operating assets and liabilities:Accounts receivable, net
    
    
    (5,496
    )
    
    
    (9,223
    )Prepaid expenses and other assets
    
    
    (17
    )
    
    
    (1,103
    )Accounts payable
    
    
    1,287
    
    
    
    (1,209
    )Accrued and other liabilities
    
    
    1,572
    
    
    
    (1,741
    )Deferred revenues
    
    
    3,295
    
    
    
    7,687Net cash used in operating activities
    
    
    (4,976
    )
    
    
    (1,030
    )Cash flows from investing activities:Purchases of property and equipment
    
    
    (13,397
    )
    
    
    (13,693
    )Purchases of intangible assets
    
    
    
    
    
    
    (4,978
    )Net cash used in investing activities
    
    
    (13,397
    )
    
    
    (18,671
    )Cash flows from financing activities:Proceeds from exercise of stock options
    
    
    192
    
    
    
    181Proceeds from issuance of convertible preferred stock, net of issuance costs
    
    
    39,653
    
    
    
    Proceeds from issuance of common stock, net of issuance costs
    
    
    
    
    
    
    59,356Proceeds from issuance of notes payable
    
    
    500
    
    
    
    9,608Principal payments on notes payable and capital lease obligations
    
    
    (2,761
    )
    
    
    (3,827
    )Net cash provided by financing activities
    
    
    37,584
    
    
    
    65,318Net increase in cash and cash equivalents
    
    
    19,211
    
    
    
    45,617Cash and cash equivalents at beginning of period
    
    
    8,927
    
    
    
    22,196Cash and cash equivalents at end of period
    
    $
    28,138
    
    
    $
    67,813
 See accompanying notes to the condensed consolidated financial statements.
 3




---



##### Table of Contents



Omniture, Inc.
 
 Notes to Condensed Consolidated Financial Statements
(unaudited)
 1. Summary of Business and Basis of Presentation
   Initial Public Offering
  Principles of Consolidation
  Use of Estimates
  4




---



##### Table of Contents



Omniture, Inc.
Notes to Condensed Consolidated Financial Statements(Continued)
(unaudited)
 Reverse Stock Split
  Segments
  Comprehensive Loss
  Recent Accounting Pronouncements
 Accounting for Uncertainty in Income Taxes  an Interpretation of FASB Statement No. 109
 Fair Value Measurements
 2. Stock-Based Compensation
   5




---



##### Table of Contents



Omniture, Inc.
Notes to Condensed Consolidated Financial Statements(Continued)
(unaudited)
   
    
    all shares of the Companys common stock reserved under the 1999 Plan that are not issued
or subject to outstanding grants;
    
    any shares of the Companys common stock issued under the 1999 Plan that are repurchased by
the Company at the original purchase price; and
    
    any shares of the Companys common stock issuable upon exercise of options granted under
the 1999 Plan that expire or become unexercisable without having been exercised in full.
  
    
    5% of the outstanding shares of the Companys common stock on the last day of the preceding year; and
    
    30,000,000 shares.
   
    
    1% of the outstanding shares of the Companys common stock on the first day of the year;
    
    12,000,000 shares; and
    
    such other amount as may be determined by the Companys Board of Directors or a committee thereof.
 Share-Based Payment
 6




---



##### Table of Contents



Omniture, Inc.
Notes to Condensed Consolidated Financial Statements(Continued)
(unaudited)
 Accounting for Stock
Issued to Employees
  Share-Based Payment
   Expected volatility
    
    
    63%-64
    %Expected term (in years)
    
    
    5.8-7.0Risk-free interest rate
    
    
    4.6%-5.1
    %Expected dividends
    
    
    
 7




---



##### Table of Contents



Omniture, Inc.
Notes to Condensed Consolidated Financial Statements(Continued)
(unaudited)
  Weighted-Number of
    
    
    
    
    
    AverageShares
    
    Weighted-
    
    Remaining
    
    AggregateSubject to
    
    Average
    
    Contractual
    
    IntrinsicOutstanding
    
    Exercise Price
    
    Term
    
    ValueOptions
    
    Per Share
    
    (in Years)
    
    (2)(in thousands)Outstanding at December 31, 2005
    
    
    6,728,518
    
    
    $
    0.91Granted
    
    
    2,170,186
    
    
    
    7.64Exercised
    
    
    (1,444,621
    )
    
    
    0.15Canceled
    
    
    (144,543
    )
    
    
    3.65Outstanding at September 30, 2006
    
    
    7,309,540
    
    
    
    2.55
    
    
    
    7.4
    
    
    $
    36,312Vested and expected to vest at
September 30, 2006 (1)
    
    
    1,942,768
    
    
    
    7.61
    
    
    
    9.6
    
    
    $
    1,088Exercisable at September 30, 2006
    
    
    4,672,565
    
    
    
    1.12
    
    
    
    6.3
    
    
    $
    31,678
 
 (1)
    
    Includes only options granted beginning January 1, 2006 that are subject to the provisions of
SFAS No. 123R.(2)
    
    The aggregate intrinsic value is calculated as the difference between the exercise price of
the underlying stock option awards and the closing market price of the Companys common stock
at September 30, 2006.     8




---



##### Table of Contents



Omniture, Inc.
Notes to Condensed Consolidated Financial Statements(Continued)
(unaudited)
  Three Months
    
    
    Nine MonthsEnded September 30,
    
    
    Ended September 30,2005
    
    
    2006
    
    
    2005
    
    
    2006(unaudited)Cost of subscription revenues
    
    $
    11
    
    
    $
    60
    
    
    $
    27
    
    
    $
    116Cost of professional services and other revenues
    
    
    2
    
    
    
    14
    
    
    
    4
    
    
    
    30Sales and marketing
    
    
    31
    
    
    
    292
    
    
    
    46
    
    
    
    634Research and development
    
    
    78
    
    
    
    155
    
    
    
    164
    
    
    
    381General and administrative
    
    
    12
    
    
    
    376
    
    
    
    18
    
    
    
    956$
    134
    
    
    $
    897
    
    
    $
    259
    
    
    $
    2,117
 3. Concentrations of Credit Risk and Significant Customers
   Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2005
    
    
    2006
    
    
    2005
    
    
    2006(unaudited)Revenues from customers within the United States
    
    $
    10,268
    
    
    $
    17,382
    
    
    $
    26,083
    
    
    $
    47,207Revenues from customers outside the United States
    
    
    1,246
    
    
    
    3,646
    
    
    
    2,974
    
    
    
    9,081Total revenues
    
    $
    11,514
    
    
    $
    21,028
    
    
    $
    29,057
    
    
    $
    56,288Revenues from customers outside the United
States as a percentage of total revenues
    
    
    11
    %
    
    
    17
    %
    
    
    10
    %
    
    
    16
    %
 9




---



##### Table of Contents



Omniture, Inc.
Notes to Condensed Consolidated Financial Statements(Continued)
(unaudited)
 4. Net Loss Per Share
  Three Months
    
    
    Nine MonthsEnded September 30,
    
    
    Ended September 30,2005
    
    
    2006
    
    
    2005
    
    
    2006(unaudited)Numerator:Net loss
    
    $
    (3,820
    )
    
    $
    (1,273
    )
    
    $
    (10,240
    )
    
    $
    (6,962
    )Denominator:Weighted-average common shares outstanding
    
    
    14,610
    
    
    
    46,774
    
    
    
    14,251
    
    
    
    25,415Weighted-average common shares outstanding subject
to repurchase
    
    
    (813
    )
    
    
    (924
    )
    
    
    (622
    )
    
    
    (753
    )Denominator for basic and diluted net loss per share
    
    
    13,797
    
    
    
    45,850
    
    
    
    13,629
    
    
    
    24,662
  Three Months
    
    Nine MonthsEnded September 30,
    
    Ended September 30,2005
    
    2006
    
    2005
    
    2006(unaudited)Common shares outstanding subject to repurchase
    
    
    795
    
    
    
    900
    
    
    
    603
    
    
    
    735Employee stock options
    
    
    4,984
    
    
    
    4,415
    
    
    
    4,987
    
    
    
    5,308Warrants
    
    
    485
    
    
    
    273
    
    
    
    439
    
    
    
    405Convertible preferred stock
    
    
    21,472
    
    
    
    711
    
    
    
    16,564
    
    
    
    14,688
 5. Balance Sheet Accounts
 Property and Equipment
  December 31,
    
    
    September 30,2005
    
    
    2006(unaudited)Computers, equipment and software
    
    $
    35,519
    
    
    $
    48,780Furniture and fixtures
    
    
    483
    
    
    
    804Leasehold improvements
    
    
    1,204
    
    
    
    1,31537,206
    
    
    
    50,899Less: Accumulated depreciation and amortization
    
    
    (9,689
    )
    
    
    (17,835
    )$
    27,517
    
    
    $
    33,064
 10




---



##### Table of Contents



Omniture, Inc.
Notes to Condensed Consolidated Financial Statements(Continued)
(unaudited)
  Intangible Assets
    Accrued Liabilities
  December 31,
    
    
    September 30,2005
    
    
    2006(unaudited)Patent license and settlement costs
    
    $
    9,495
    
    
    $
    4,256Accrued bonuses and commissions
    
    
    1,932
    
    
    
    2,882Other accrued liabilities
    
    
    2,566
    
    
    
    4,429$
    13,993
    
    
    $
    11,567
 11




---



##### Table of Contents



Omniture, Inc.
Notes to Condensed Consolidated Financial Statements(Continued)
(unaudited)
 Other Liabilities
  December 31,
    
    
    September 30,2005
    
    
    2006(unaudited)Patent license and settlement costs
    
    $
    3,819
    
    
    $
    982Other liabilities
    
    
    299
    
    
    
    379$
    4,118
    
    
    $
    1,361
 6. Notes Payable
  Interest
    
    
    Final Maturity
    
    
    December 31,
    
    
    September 30,Rate
    
    
    Date
    
    
    2005
    
    
    2006(unaudited)Draw on equipment line of credit
    
    
    5.00
    %
    
    Aug. 2007
    
    $
    2,349
    
    
    $
    1,292Draw on equipment line of credit
    
    
    5.06
    
    
    Oct. 2007
    
    
    1,654
    
    
    
    977Draw on equipment line of credit
    
    
    4.81
    
    
    Oct. 2007
    
    
    1,326
    
    
    
    784Draw on revolving line of credit
    
    variable rate
    
    Dec. 2007
    
    
    500
    
    
    
    500Draw on second equipment facility
    
    
    7.55
    
    
    Jan. 2009
    
    
    
    
    
    
    1,556Draw on second equipment facility
    
    
    7.77
    
    
    Feb. 2009
    
    
    
    
    
    
    886Draw on second equipment facility
    
    
    8.03
    
    
    Mar. 2009
    
    
    
    
    
    
    1,667Draw on second equipment facility
    
    
    8.38
    
    
    Apr. 2009
    
    
    
    
    
    
    1,864Draw on second equipment facility
    
    
    8.79
    
    
    June 2009
    
    
    
    
    
    
    2,1475,829
    
    
    
    11,673Less: current portion
    
    
    
    
    
    
    
    
    
    
    (3,035
    )
    
    
    (6,120
    )Notes payable, excluding current
portion
    
    
    
    
    
    
    
    
    
    $
    2,794
    
    
    $
    5,553
   12




---



##### Table of Contents



Omniture, Inc.
Notes to Condensed Consolidated Financial Statements(Continued)
(unaudited)
   Year Ending December 31,(unaudited)Remaining three months in 2006
    
    $
    1,5592007
    
    
    5,9972008
    
    
    3,2032009
    
    
    914$
    11,673
 7. Income Taxes
 Accounting for Income Taxes.
  13




---



##### Table of Contents



Omniture, Inc.
Notes to Condensed Consolidated Financial Statements(Continued)
(unaudited)
 8. Commitments and Contingencies
 Litigation Settlement
   Leases
  14




---



##### Table of Contents



Omniture, Inc.
Notes to Condensed Consolidated Financial Statements(Continued)
(unaudited)
  Capital
    
    
    OperatingYear ending December 31,
    
    Leases
    
    
    Leases(unaudited)Remaining three months in 2006
    
    $
    28
    
    
    $
    4122007
    
    
    64
    
    
    
    1,6992008
    
    
    26
    
    
    
    1,6742009
    
    
    
    
    
    
    1,6982010
    
    
    
    
    
    
    1,7472011
    
    
    
    
    
    
    443Total minimum lease payments
    
    
    118
    
    
    $
    7,673Less: imputed interest
    
    
    (18
    )Present value of minimum lease payments
    
    
    100Less: current portion
    
    
    (65
    )Capital lease obligations, less current portion
    
    $
    35
 Indemnification
  Warranties
    15




---



##### Table of Contents



Omniture, Inc.
Notes to Condensed Consolidated Financial Statements(Continued)
(unaudited)
 Other Legal Matters
  16




---



##### Table of Contents



Item 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
     Overview
  17




---



##### Table of Contents



How We Generate Revenues
  Subscription Revenues.
 18




---



##### Table of Contents



Professional Services and Other Revenues.
  Indirect Sales.
 Cost of Revenues and Operating Expenses
 Cost of Revenues.
  19




---



##### Table of Contents



Operating Expenses.
    Trends in Our Business and Results of Operations
    20




---



##### Table of Contents



Share-Based Payment
  21




---



##### Table of Contents



Results of Operations
  Three Months
    
    
    Nine MonthsEnded September 30,
    
    
    Ended September 30,2005
    
    
    2006
    
    
    2005
    
    
    2006Revenues:Subscription
    
    
    97
    %
    
    
    93
    %
    
    
    97
    %
    
    
    94
    %Professional services and other
    
    
    3
    
    
    
    7
    
    
    
    3
    
    
    
    6Total revenues
    
    
    100
    
    
    
    100
    
    
    
    100
    
    
    
    100Cost of revenues:Subscription
    
    
    39
    
    
    
    36
    
    
    
    39
    
    
    
    37Professional services and other
    
    
    4
    
    
    
    4
    
    
    
    5
    
    
    
    4Total cost of revenues
    
    
    43
    
    
    
    40
    
    
    
    44
    
    
    
    41Gross margin
    
    
    57
    
    
    
    60
    
    
    
    56
    
    
    
    59Operating expenses:Sales and marketing
    
    
    57
    
    
    
    42
    
    
    
    60
    
    
    
    45Research and development
    
    
    17
    
    
    
    11
    
    
    
    16
    
    
    
    11General and administrative
    
    
    16
    
    
    
    15
    
    
    
    15
    
    
    
    15Total operating expenses
    
    
    90
    
    
    
    68
    
    
    
    91
    
    
    
    71Loss from operations
    
    
    (33
    )
    
    
    (8
    )
    
    
    (35
    )
    
    
    (12
    )Interest income
    
    
    2
    
    
    
    4
    
    
    
    1
    
    
    
    2Interest expense
    
    
    (2
    )
    
    
    (2
    )
    
    
    (1
    )
    
    
    (2
    )Other expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Loss before provision for income taxes
    
    
    (33
    )
    
    
    (6
    )
    
    
    (35
    )
    
    
    (12
    )Provision for income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net loss
    
    
    (33
    )%
    
    
    (6
    )%
    
    
    (35
    )%
    
    
    (12
    )%
 Revenues
 Three Months
    
    
    
    
    
    
    Nine MonthsEnded September 30,
    
    
    
    
    
    
    Ended September 30,2005
    
    
    2006
    
    
    % Change
    
    
    2005
    
    
    2006
    
    
    % Change(in thousands)
    
    
    
    
    
    
    (in thousands)Subscription
    
    $
    11,136
    
    
    $
    19,535
    
    
    
    75
    %
    
    $
    28,112
    
    
    $
    52,673
    
    
    
    87
    %Professional services and other
    
    
    378
    
    
    
    1,493
    
    
    
    295
    
    
    
    945
    
    
    
    3,615
    
    
    
    283Total revenues
    
    $
    11,514
    
    
    $
    21,028
    
    
    
    83
    %
    
    $
    29,057
    
    
    $
    56,288
    
    
    
    94
    %
  22




---



##### Table of Contents



Three Months
    
    
    
    
    
    
    Nine MonthsEnded September 30,
    
    
    
    
    
    
    Ended September 30,2005
    
    
    2006
    
    
    % Change
    
    
    2005
    
    
    2006
    
    
    % Change(in thousands)
    
    
    
    
    
    
    (in thousands)Revenues from customers within the U.S.
    
    $
    10,268
    
    
    $
    17,382
    
    
    
    69
    %
    
    $
    26,083
    
    
    $
    47,207
    
    
    
    81
    %Revenues from customers outside the U.S
    
    
    1,246
    
    
    
    3,646
    
    
    
    193
    
    
    
    2,974
    
    
    
    9,081
    
    
    
    205Total revenues
    
    $
    11,514
    
    
    $
    21,028
    
    
    
    83
    %
    
    $
    29,057
    
    
    $
    56,288
    
    
    
    94
    %Revenues from customers outside the U.S.
as a percentage of total revenues
    
    
    11
    %
    
    
    17
    %
    
    
    
    
    
    
    10
    %
    
    
    16
    %
   Cost of Revenues
 Three Months
    
    
    
    
    
    
    Nine MonthsEnded September 30,
    
    
    
    
    
    
    Ended September 30,2005
    
    
    2006
    
    
    % Change
    
    
    2005
    
    
    2006
    
    
    % Change(in thousands)
    
    
    
    
    
    
    (in thousands)Subscription
    
    $
    4,476
    
    
    $
    7,721
    
    
    
    72
    %
    
    $
    11,426
    
    
    $
    20,632
    
    
    
    81
    %Professional services and other
    
    
    510
    
    
    
    778
    
    
    
    53
    
    
    
    1,390
    
    
    
    2,206
    
    
    
    59Total cost of revenues
    
    $
    4,986
    
    
    $
    8,499
    
    
    
    70
    %
    
    $
    12,816
    
    
    $
    22,838
    
    
    
    78
    %
  Three Months
    
    
    Nine MonthsEnded September 30,
    
    
    Ended September 30,2005
    
    
    2006
    
    
    2005
    
    
    2006Subscription
    
    
    40
    %
    
    
    40
    %
    
    
    41
    %
    
    
    39
    %Professional services and other
    
    
    135
    %
    
    
    52
    %
    
    
    147
    %
    
    
    61
    %
  23




---



##### Table of Contents



Operating Expenses
 Three Months
    
    
    
    
    
    
    Nine MonthsEnded September 30,
    
    
    
    
    
    
    Ended September 30,2005
    
    
    2006
    
    
    % Change
    
    
    2005
    
    
    2006
    
    
    % Change(in thousands)
    
    
    
    
    
    
    (in thousands)Sales and marketing
    
    $
    6,542
    
    
    $
    8,847
    
    
    
    35
    %
    
    $
    17,318
    
    
    $
    25,633
    
    
    
    48
    %Research and development
    
    
    2,007
    
    
    
    2,284
    
    
    
    14
    
    
    
    4,771
    
    
    
    6,332
    
    
    
    33General and administrative
    
    
    1,841
    
    
    
    3,078
    
    
    
    67
    
    
    
    4,228
    
    
    
    8,496
    
    
    
    101Total operating expenses
    
    $
    10,390
    
    
    $
    14,209
    
    
    
    37
    %
    
    $
    26,317
    
    
    $
    40,461
    
    
    
    54
    %
 Sales and Marketing
   24




---



##### Table of Contents



Research and Development
   General and Administrative
   Interest Income
 Three Months
    
    
    Nine MonthsEnded September 30,
    
    
    Ended September 30,2005
    
    
    2006
    
    
    2005
    
    
    2006(in thousands)Interest income
    
    $
    250
    
    
    $
    861
    
    
    $
    353
    
    
    $
    1,233
  Interest Expense
 Three Months
    
    
    Nine MonthsEnded September 30,
    
    
    Ended September 30,2005
    
    
    2006
    
    
    2005
    
    
    2006(in thousands)Interest expense
    
    $
    188
    
    
    $
    368
    
    
    $
    485
    
    
    $
    985
  25




---



##### Table of Contents



Liquidity and Capital Resources
    Operating Activities
   Investing Activities
  26




---



##### Table of Contents



Financing Activities
  Other Factors Affecting Liquidity and Capital Resources
       27




---



##### Table of Contents



Off-Balance Sheet Arrangements
   Contractual Obligations and Commitments
  PatentLicense andCapital
    
    
    Operating
    
    
    Notes
    
    
    SettlementYear ending December 31,
    
    Leases
    
    
    Leases
    
    
    Payable
    
    
    Costs
    
    
    TotalRemaining three months in 2006
    
    $
    28
    
    
    $
    412
    
    
    $
    1,559
    
    
    $
    1,500
    
    
    $
    3,4992007
    
    
    64
    
    
    
    1,699
    
    
    
    5,997
    
    
    
    4,000
    
    
    
    11,7602008
    
    
    26
    
    
    
    1,674
    
    
    
    3,203
    
    
    
    
    
    
    
    4,9032009
    
    
    
    
    
    
    1,698
    
    
    
    914
    
    
    
    
    
    
    
    2,6122010
    
    
    
    
    
    
    1,747
    
    
    
    
    
    
    
    
    
    
    
    1,7472011
    
    
    
    
    
    
    443
    
    
    
    
    
    
    
    
    
    
    
    443Total contractual obligations
    
    $
    118
    
    
    $
    7,673
    
    
    $
    11,673
    
    
    $
    5,500
    
    
    $
    24,964
   Critical Accounting Policies
  28




---



##### Table of Contents



Revenue Recognition
 Revenue Recognition Revenue Arrangements with Multiple Deliverables.
 
    
    there is persuasive evidence of an arrangement;
    
    the service has been provided to the customer;
    
    the collection of the fees is reasonably assured; and
    
    the amount of fees to be paid by the customer is fixed or determinable.
    Allowances for Accounts Receivable
   29




---



##### Table of Contents



Impairment of Long-Lived Assets
 Accounting for the Impairment and Disposal of Long-Lived Assets.
 Stock-Based Compensation
 Accounting for Stock Issued to Employees Accounting for Certain
Transactions Involving Stock Compensation, an Interpretation of APB Opinion No. 25 Accounting for
Stock-Based Compensation Accounting for Stock-Based Compensation  Transition
and Disclosure
   Recent Accounting Pronouncements
 Accounting for Uncertainty in Income Taxes  an Interpretation of FASB Statement No. 109
 30




---



##### Table of Contents



Fair Value Measurements
 
 Item 3. Quantitative and Qualitative Disclosures About Market Risk
 Foreign Currency Exchange Risk
  Interest Rate Sensitivity
  31




---



##### Table of Contents



Item 4. Controls and Procedures
 (a) Evaluation of disclosure controls and procedures
   (b) Changes in Internal Control Over Financial Reporting
   32




---



##### Table of Contents



PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
 Factors That Could Affect Future Results
 Set forth below and elsewhere in this quarterly report on Form 10-Q , and in other documents we
file with the SEC, are risks and uncertainties that could cause actual results to differ materially
from the results contemplated by the forward-looking statements contained in this quarterly report
on Form 10-Q . Because of the following factors, as well as other variables affecting our operating
results, past financial performance should not be considered a reliable indicator of future
performance and investors should not use historical trends to anticipate results or trends in
future periods.
 Risks Related to Our Business
 We have a history of significant net losses, may incur significant net losses in the future and may
not achieve or maintain profitability.
  We have derived substantially all of our subscription revenues from sales of our SiteCatalyst
service. If our SiteCatalyst service is not widely accepted by new customers, our operating results
will be harmed.
  33




---



##### Table of Contents



If we are unable to attract new customers or to sell additional services to our existing customers,
our revenue growth will be adversely affected.
  Our business depends substantially on customers renewing their subscriptions for our online
business optimization services. Any decline in our customer renewals would harm our future
operating results.
  The significant capital requirements of our business model make it more difficult to achieve
positive cash flow and profitability if we continue to grow rapidly.
  Our growth depends upon our ability to add new and retain existing large customers; however, to the
extent we are successful in doing so, our gross margins and ability to achieve profitability and
positive cash flow may be impaired.
  34




---



##### Table of Contents



Because we recognize subscription revenue over the term of the applicable agreement, the lack of
subscription renewals or new service agreements may not immediately be reflected in our operating
results.
  We have limited experience with respect to our pricing model and if the prices we charge for our
services are unacceptable to our customers, our revenues and operating results will be harmed.
  If we are unable to develop or acquire new services, our revenue growth will be harmed.
  Our quarterly results of operations may fluctuate in the future. As a result, we may fail to meet
or exceed the expectations of securities analysts or investors, which could cause our stock price
to decline.
  
    
    our ability to increase sales to existing customers and attract new customers;
    
    the addition or loss of large customers;
 35




---



##### Table of Contents




    
    the amount and timing of operating costs and capital expenditures related to the maintenance and
expansion of our business, operations and infrastructure;
    
    the timing and success of new product and service introductions by us or our competitors;
    
    seasonal variations in the demand for our services and the implementation cycles for our new customers;
    
    levels of revenues from our larger customers, which have lower per transaction pricing due to higher
transaction commitments;
    
    changes in our pricing policies or those of our competitors;
    
    service outages or security breaches;
    
    the extent to which any of our significant customers terminate their service agreements with us or
reduce the number of transactions from which we capture data pursuant to their service agreements;
    
    limitations of the capacity of our network and systems;
    
    the timing of costs related to the development or acquisition of technologies, services or businesses;
    
    general economic, industry and market conditions and those conditions specific to Internet usage and
online businesses;
    
    the purchasing and budgeting cycles of our customers; and
    
    geopolitical events such as war, threat of war or terrorist actions.
  The market for on-demand services, in general, and for online business optimization services, in
particular, is at an early stage of development, and if it does not develop or develops more slowly
than we expect, our business will be harmed.
  
    
    the security capabilities, reliability and availability of on-demand services;
    
    customer concerns with entrusting a third party to store and manage their data;
    
    public concern regarding privacy;
    
    the level of customization or configuration we offer;
 36




---



##### Table of Contents




    
    our ability to maintain high levels of customer satisfaction;
    
    our ability to provide reports in real time during periods of intense activity on customer websites;
    
    the price, performance and availability of competing products and services;
    
    the rate of continued growth in online commerce and online advertising; and
    
    the current and possible future imposition by federal, state and local agencies of taxes on goods
and services that are provided over the Internet.
  We operate in a highly competitive market, which could make it difficult for us to acquire and
retain customers.
  
    
    companies such as Coremetrics, Inc., Google Inc., Nedstat Ltd., WebSideStory, Inc. and WebTrends Inc.
that offer on-demand services;
    
    software vendors such as Epiphany, Inc. (acquired by SSA Global), NetRatings, Inc., Sane Solutions,
LLC (acquired by Unica Corporation) and SAS Institute, Inc.; and
    
    online marketing service providers such as aQuantive, Inc., DoubleClick Inc. and 24/7 Real Media, Inc.
   
    
    absorb costs associated with providing their products at a lower price;
    
    devote more resources to new customer acquisitions;
    
    respond to evolving market needs more quickly than we can; and
    
    finance more research and development activities to develop better services.
   37




---



##### Table of Contents



We rely on a small number of third-party service providers to host and deliver our services, and
any interruptions or delays in services from these third parties could impair the delivery of our
services and harm our business.
     If we fail to respond to rapidly changing technological developments or evolving industry
standards, our services may become obsolete or less competitive.
  We have experienced rapid growth in recent periods. If we fail to manage our growth effectively, we
may be unable to execute our business plan, maintain high levels of service or address competitive
challenges adequately.
  38




---



##### Table of Contents



Failure to effectively expand our sales and marketing capabilities could harm our ability to
increase our customer base and achieve broader market acceptance of our services.
  Our growth depends in part on the success of our strategic relationships with third parties,
including technology integration, channel partners and resellers of our services.
  Because our long-term success depends, in part, on our ability to expand the sales of our services
to customers located outside of the United States, our business will be susceptible to risks
associated with international operations.
  
    
    fluctuations in currency exchange rates;
    
    unexpected changes in foreign regulatory requirements;
    
    longer accounts receivable payment cycles and difficulties in collecting accounts receivable;
    
    difficulties in managing and staffing international operations;
 39




---



##### Table of Contents




    
    potentially adverse tax consequences, including the complexities of foreign value added tax systems and
restrictions on the repatriation of earnings;
    
    localization of our services, including translation into foreign languages and associated expenses;
    
    dependence on certain third parties to increase customer subscriptions;
    
    the burdens of complying with a wide variety of foreign laws and different legal standards;
    
    increased financial accounting and reporting burdens and complexities;
    
    political, social and economic instability abroad, terrorist attacks and security concerns in general; and
    
    reduced or varied protection for intellectual property rights in some countries.
    We may be liable to our customers and may lose customers if we provide poor service, if our
services do not comply with our agreements or if we are unable to collect customer data or
otherwise lose customer data.
   A rapid expansion of our network and systems could cause us to lose customer data or cause our
network or systems to fail.
  40




---



##### Table of Contents



If a third party asserts that we are infringing its intellectual property, whether successful or
not, it could subject us to costly and time-consuming litigation or expensive licenses, and our
business may be harmed.
    The success of our business depends in large part on our ability to protect and enforce our
intellectual property rights.
  41




---



##### Table of Contents



We rely on our management team and need additional personnel to grow our business, and the loss of
one or more key employees or the inability to attract and retain qualified personnel could harm our
business.
  We may expand through acquisitions of, or investments in, other companies, each of which may divert
our managements attention, resulting in additional dilution to our stockholders and consumption of
resources that are necessary to sustain our business, which could disrupt our operations and harm
our operating results.
    42




---



##### Table of Contents




    
    issue additional equity securities that would dilute our stockholders;
    
    use a substantial portion of our cash resources that we may need in the future to operate our business;
    
    incur debt on terms unfavorable to us or that we are unable to repay;
    
    assume or incur large charges or substantial liabilities;
    
    encounter difficulties retaining key employees of the
acquired company or integrating diverse business cultures;
    
    become subject to adverse accounting or tax consequences, substantial depreciation or deferred compensation
charges; and
    
    become subject to intellectual property or other litigation.
 Material defects or errors in our software we use to deliver our services could harm our
reputation, result in significant costs to us and impair our ability to sell our services.
  
    
    lost or delayed market acceptance and sales of our services;
    
    sales credits or refunds to our customers;
    
    loss of customers;
    
    diversion of development resources;
    
    injury to our reputation; and
    
    increased warranty and insurance costs.
  Changes in financial accounting standards or practices may cause adverse, unexpected financial
reporting fluctuations and affect our reported results of operations.
  43




---



##### Table of Contents



Share-Based Payment
 We might require additional capital to support business growth, and this capital might not be
available on acceptable terms, or at all.
  If we fail to maintain proper and effective internal controls, our ability to produce accurate
financial statements could be impaired, which could adversely affect our operating results, our
ability to operate our business and investors views of us.
  If we cannot maintain our corporate culture as we grow, we could lose the innovation, teamwork and
focus that we believe our culture fosters, and our business may be harmed.
  44




---



##### Table of Contents



Risks Related to Our Industry
 Widespread blocking or erasing of cookies or other limitations on our ability to use cookies or
other technologies that we employ may impede our ability to collect information and reduce the
value of our services.
   We interact with consumers through our customers, so we may be held accountable for our customers
handling of the consumers personal information.
   45




---



##### Table of Contents



Domestic or foreign laws or regulations may limit our ability to collect and use Internet user
information, resulting in a decrease in the value of our services and having an adverse impact on
the sales of our services.
     We may face liability for the unauthorized disclosure or theft of private information, which could
expose us to liabilities and harm our stock price.
  46




---



##### Table of Contents



We may face public relations problems as a result of violations of privacy laws and perceived
mistreatment of personal information, and these public relations problems may harm our reputation
and thereby lead to a reduction in customers and lower revenues.
  Internet-related and other laws could adversely affect our business.
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
 Use of Proceeds from Public Offering of Common Stock
  47




---



##### Table of Contents



Item 3. Defaults Upon Senior Securities.
  
 Item 4. Submission of Matters to a Vote of Security Holders.
  
 Item 5. Other Information.
  48




---



##### Table of Contents



Item 6. Exhibits.
 (a) Exhibits
 3.1(A)
    
    Amended and Restated Certificate of Incorporation of the Registrant currently in effect3.2(A)
    
    Amended and Restated Bylaws of the Registrant currently in effect4.1(B)
    
    Specimen common stock certificate of the Registrant4.2(B)
    
    Amended and Restated Registration Rights Agreement, dated as of April 26, 2006, between the
Registrant and certain holders of the Registrants common stock named therein4.3(B)
    
    Silicon Valley Bank Second Amended and Restated Loan and Security Agreement dated January 10,
200610.1(B)
    
    Form of Indemnification Agreement entered into by and between the Registrant and each of its
directors and officers10.2A(B)
    
    1999 Equity Incentive Plan of the Registrant, as amended10.2B(B)
    
    Forms of Stock Option Agreement under the 1999 Equity Incentive Plan10.2C(B)
    
    Form of Stock Option Agreement under the 1999 Equity Incentive Plan entered into by and among
the Registrant and its Named Executive Officers and non-employee directors10.3A(B)
    
    2006 Equity Incentive Plan of the Registrant10.3B(B)
    
    Form of Stock Option Agreement under the 2006 Equity Incentive Plan10.4A(B)
    
    2006 Employee Stock Purchase Plan of the Registrant10.4B(B)
    
    Form of Subscription Agreement under 2006 Employee Stock Purchase Plan10.5(B)
    
    Amended and Restated Employment Agreement between the Registrant and Joshua G. James10.6(B)
    
    Amended and Restated Employment Agreement between the Registrant and John R. Pestana10.7(B)
    
    Offer Letter with Michael S. Herring, dated October 20, 200410.8A(B)
    
    Basic Lease Information and Canyon Park Technology Center Office Building Lease Agreement,
dated as of May 9, 2003, between the Registrant and TCU Properties I, LLC10.8B(B)
    
    First Amendment to Basic Lease Information and Canyon Park Technology Center Office Building
Lease Agreement, dated May 6, 2004, between the Registrant and TCU Properties I, LLC10.8C(B)
    
    Second Amendment to Basic Lease Information and Canyon Park Technology Center Office Building
Lease Agreement, dated December 8, 2004, between the Registrant and TCU Properties I, LLC
 49




---



##### Table of Contents



10.8D(B)
    
    Third Amendment to Basic Lease Information and Canyon Park Technology Center Office Building
Lease Agreement, dated April 30, 2005, between the Registrant and TCU Properties I, LLC10.8E(B)
    
    Fourth Amendment to Basic Lease Information and Canyon Park Technology Center Office Building
Lease Agreement, dated May 31, 2005, between the Registrant and TCU Properties I, LLC10.8F(B)
    
    Fifth Amendment to Basic Lease Information and Canyon Park Technology Center Office Building
Lease Agreement, dated January 25, 2006, between the Registrant and TCU Properties I, LLC10.9(B)
    
    Settlement and Patent License Agreement, dated February 28, 2006, by and between NetRatings,
Inc. and the Registrant10.10(B)
    
    NetObjects, Inc. Warrant to Purchase Stock dated March 26, 200210.11(B)
    
    Silicon Valley Bank Warrant to Purchase Stock dated April 10, 200010.12(B)
    
    Change of Control Agreement between the Registrant and Joshua G. James10.13(B)
    
    Change of Control Agreement between the Registrant and John R. Pestana10.14(B)
    
    Form of Change of Control Agreement between Registrant and Brett M. Error and Christopher C.
Harrington10.15(B)
    
    Change of Control Agreement between the Registrant and Michael S. Herring31.1*
    
    Certification of Chief Executive Officer and President Pursuant to Exchange Act Rule 13a-14(a)31.2*
    
    Certification of Chief Financial Officer Pursuant to Exchange Act Rule 13a-14(a)32.1*
    
    Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 
 *
    
    Filed herewith.
    
    We obtained confidential treatment from the Securities and Exchange Commission with respect to portions of
this exhibit. A complete copy of this exhibit has been filed separately with the Commission.(A)
    
    Incorporated by reference to exhibits of the same number filed with the Registrants Quarterly Report on Form
10-Q (File No. 000-52076) on August 11, 2006.(B)
    
    Incorporated by reference to exhibits of the same number filed with the Registrants Registration Statement
on Form S-1 (File No. 333-132987), which the Securities and Exchange Commission declared effective on June
27, 2006. 50




---



##### Table of Contents



SIGNATURES
  OMNITURE, INC. 
(Registrant)Date:  November 13, 2006

/s/
Joshua G. JamesJoshua G. JamesPresident and Chief Executive
Officer
(Principal Executive Officer) Date:  November 13, 2006

/s/
Michael S. HerringMichael S. HerringChief Financial Officer and
Executive Vice President
(Principal Financial and Accounting Officer) 51




---



##### Table of Contents



EXHIBIT INDEX
 (a) Exhibits
 3.1(A)
    
    Amended and Restated Certificate of Incorporation of the Registrant currently in effect3.2(A)
    
    Amended and Restated Bylaws of the Registrant currently in effect4.1(B)
    
    Specimen common stock certificate of the Registrant4.2(B)
    
    Amended and Restated Registration Rights Agreement, dated as of April 26, 2006, between the
Registrant and certain holders of the Registrants common stock named therein4.3(B)
    
    Silicon Valley Bank Second Amended and Restated Loan and Security Agreement dated January 10,
200610.1(B)
    
    Form of Indemnification Agreement entered into by and between the Registrant and each of its
directors and officers10.2A(B)
    
    1999 Equity Incentive Plan of the Registrant, as amended10.2B(B)
    
    Forms of Stock Option Agreement under the 1999 Equity Incentive Plan10.2C(B)
    
    Form of Stock Option Agreement under the 1999 Equity Incentive Plan entered into by and among
the Registrant and its Named Executive Officers and non-employee directors10.3A(B)
    
    2006 Equity Incentive Plan of the Registrant10.3B(B)
    
    Form of Stock Option Agreement under the 2006 Equity Incentive Plan10.4A(B)
    
    2006 Employee Stock Purchase Plan of the Registrant10.4B(B)
    
    Form of Subscription Agreement under 2006 Employee Stock Purchase Plan10.5(B)
    
    Amended and Restated Employment Agreement between the Registrant and Joshua G. James10.6(B)
    
    Amended and Restated Employment Agreement between the Registrant and John R. Pestana10.7(B)
    
    Offer Letter with Michael S. Herring, dated October 20, 200410.8A(B)
    
    Basic Lease Information and Canyon Park Technology Center Office Building Lease Agreement,
dated as of May 9, 2003, between the Registrant and TCU Properties I, LLC10.8B(B)
    
    First Amendment to Basic Lease Information and Canyon Park Technology Center Office Building
Lease Agreement, dated May 6, 2004, between the Registrant and TCU Properties I, LLC
 52




---



##### Table of Contents



10.8C(B)
    
    Second Amendment to Basic Lease Information and Canyon Park Technology Center Office Building
Lease Agreement, dated December 8, 2004, between the Registrant and TCU Properties I, LLC10.8D(B)
    
    Third Amendment to Basic Lease Information and Canyon Park Technology Center Office Building
Lease Agreement, dated April 30, 2005, between the Registrant and TCU Properties I, LLC10.8E(B)
    
    Fourth Amendment to Basic Lease Information and Canyon Park Technology Center Office Building
Lease Agreement, dated May 31, 2005, between the Registrant and TCU Properties I, LLC10.8F(B)
    
    Fifth Amendment to Basic Lease Information and Canyon Park Technology Center Office Building
Lease Agreement, dated January 25, 2006, between the Registrant and TCU Properties I, LLC10.9(B)
    
    Settlement and Patent License Agreement, dated February 28, 2006, by and between NetRatings,
Inc. and the Registrant10.10(B)
    
    NetObjects, Inc. Warrant to Purchase Stock dated March 26, 200210.11(B)
    
    Silicon Valley Bank Warrant to Purchase Stock dated April 10, 200010.12(B)
    
    Change of Control Agreement between the Registrant and Joshua G. James10.13(B)
    
    Change of Control Agreement between the Registrant and John R. Pestana10.14(B)
    
    Form of Change of Control Agreement between Registrant and Brett M. Error and Christopher C.
Harrington10.15(B)
    
    Change of Control Agreement between the Registrant and Michael S. Herring31.1*
    
    Certification of Chief Executive Officer and President Pursuant to Exchange Act Rule 13a-14(a)31.2*
    
    Certification of Chief Financial Officer Pursuant to Exchange Act Rule 13a-14(a)32.1*
    
    Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 
 *
    
    Filed herewith.
    
    We obtained confidential treatment from the Securities and Exchange Commission with respect to portions of
this exhibit. A complete copy of this exhibit has been filed separately with the Commission.(A)
    
    Incorporated by reference to exhibits of the same number filed with the Registrants Quarterly Report on Form
10-Q (File No. 000-52076) on August 11, 2006.(B)
    
    Incorporated by reference to exhibits of the same number filed with the Registrants Registration Statement
on Form S-1 (File No. 333-132987), which the Securities and Exchange Commission declared effective on June
27, 2006. 53