UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K


x	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2006
or
o	TRANSITIONAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For transition period from _______ to _______

Commission file number: 000-27582

SPEEDUS CORP.
(Exact name of registrant as specified in its charter)


Delaware		13-3853788
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

9 Desbrosses Street, Suite 402, New York, NY (Address of Principal Executive Offices)		10013 (Zip code)

(888) 773-3669 (Registrant’s telephone number)

Securities registered pursuant to Section 12(b) of the Act:

Common Stock, par value $.01 per share (Title of each class)		The NASDAQ Stock Market LLC (Name of each exchange on which registered)

Securities registered pursuant to Section 12 (g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.


Large accelerated filer o	Accelerated filer o	Non-accelerated filer x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

The aggregate market value of the Registrant’s Common Stock held by non-affiliates of the Registrant was $9,706,000 on June 30, 2006, based on the closing trade price of the Common Stock on the NASDAQ Capital Market on that date.

The number of shares of Common Stock outstanding as of March 15, 2007 was 15,969,290.

DOCUMENTS INCORPORATED BY REFERENCE

None

SPEEDUS CORP.
INDEX TO FORM 10-K


		Page

	PART I
Item 1.	Business	3
Item 1A.	Risk Factors	6
Item 1B.	Unresolved Staff Comments	9
Item 2.	Properties	9
Item 3.	Legal Proceedings	10
Item 4.	Submission of Matters to a Vote of Security Holders	10
	PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	11
Item 6.	Selected Financial Data	13
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	20
Item 8.	Financial Statements and Supplementary Data	20
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	20
Item 9A.	Controls and Procedures	20
Item 9B.	Other Information	20
	PART III
Item 10.	Directors, Executive Officers and Corporate Governance	21
Item 11.	Executive Compensation	24
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	28
Item 13.	Certain Relationships and Related Transactions, and Director Independence	29
Item 14.	Principal Accountant Fees and Services	29
	PART IV
Item 15.	Exhibits, Financial Statement Schedules	30

* * * * *

This Form 10-K contains “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements appear in a number of places in this Form 10-K and include statements regarding the intent, belief or current expectations of the Company or its officers with respect to, among other things, the ability of the Company to make capital expenditures, the ability to incur debt, to service and repay such debt, as well as other factors that may affect the Company’s financial condition or results of operations. Forward-looking statements may include, but are not limited to, projections of revenues, income or losses, capital expenditures, plans for future operations, financing needs or plans, compliance with covenants in loan agreements, plans for liquidation or sale of assets or businesses, plans relating to products or services of the Company, assessments of materiality, predictions of future events, and the ability to obtain financing, including the Company’s ability to meet obligations as they become due, and other pending and possible litigation, as well as assumptions relating to the foregoing. All statements in this Form 10-K regarding industry prospects and the Company’s financial position are forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

PART I


ITEM 1.	BUSINESS

Business Activities

Speedus Corp. is a holding company that owns significant equity interests in diverse businesses. We seek business opportunities across all industries for potential transactions and relationships in which we can apply our current resources and management strengths. The companies that we target, either public or privately held, will be seeking growth or restructuring capital to pursue near term business objectives in demonstrated markets. We will continue to pursue opportunities involving our expertise in the medical device and wireless markets, as well as those areas involving our broadband assets as attractive opportunities present themselves.

We have co-invested with Siemens Corporate Research, Inc., a subsidiary of Siemens Corporation, in Zargis Medical Corp. to develop advanced diagnostic decision support products and services for primary care physicians, pediatricians, cardiologists and other healthcare professionals. Zargis Acoustic Cardioscan® (Cardioscan®), Zargis’ core product, is the first and only FDA-authorized computer-assisted medical device designed to support physicians in analyzing heart sounds for the identification of suspected systolic and diastolic murmurs—which are a potential sign of heart disease. We own 90% of F&B Güdtfood Holding Corp., the creator and operator of the original Eurocentric “chic and quick” café, which is operating two stores in Manhattan. In 2005, we conceived Wibiki, a new software-based wireless network that leverages existing Wi-Fi infrastructures to reduce cost, complexity and risk for users when accessing the Internet wirelessly. Wibiki’s business model will employ a user opt-in advertising service we call AdChooser to generate revenues that keep Wibiki services free to users. We own a portfolio of patents that allow for high-speed wireless communications. We also own fixed wireless spectrum in the New York City metropolitan area that we may commercialize in the future to support high-speed, or broadband, Internet access service. For additional information on each of our business segments, see the discussions below and “Notes to Consolidated Financial Statements — Note 8, Business Segment Information.”

Zargis Medical Corp. In January 2001, we co-invested with Siemens Corporate Research, Inc., a subsidiary of Siemens Corporation, in Zargis Medical Corp. to develop non-invasive, diagnostic support solutions that automatically analyze acoustical data from a patient to determine physiologically significant features useful in medical diagnosis. The development of Zargis’ patented technology is a pioneering effort in medicine which uses advanced signal processing algorithms deployed on standard computer platforms. The first Zargis device, Cardioscan, received its initial FDA authorization in May 2004 and additional authorizations in September 2005 and March 2006. Cardioscan is currently being tested by a small group of physicians during general medical examinations and physicals to help detect and analyze suspected heart murmurs which could be a sign of valvular and congenital heart disease. According to the National Center for Health Statistics, the number of general medical examinations, administered in the US totaled 64 million in 2000 alone. Zargis is currently researching, and conducting trials on, additional noninvasive diagnostic support tools that process acoustical data from the body in order to provide an accurate and intelligible assessment of a patient’s health. These assessments may be used by physicians and other healthcare providers to assist in the early identification or monitoring of heart, lung, vascular and other conditions and to provide better patient treatment.

Major next steps remaining for Zargis include continuing market trials and clinical trials for new applications of the Zargis technology and the formation of strategic partnerships designed to support product commercialization.

In February 2003, we acquired a controlling interest in Zargis Medical. At December 31, 2006, as a result of continued investment, our ownership interest was approximately 80%.

F&B Güdtfood. We own 90% of F&B Güdtfood, the creator and operator of the original Eurocentric “chic and quick” café, which is operating two stores in Manhattan. The acquisition price was $3,500,000 in May 2002. In February 2003, we reduced our cash investment in F&B Güdtfood and received $1,775,000 while maintaining our original 51% interest. In December 2003, as a result of renegotiation, our interest increased to 80% without an additional investment. As a result of certain milestones not having been met, in 2005 our interest increased to 90%. We have also entered into a management services contract with F&B Güdtfood that will result in direct revenues to us although these revenues will be eliminated on our consolidated financial statements.

with expiration dates ranging from 2007 through 2017, with approximately 46 international counterparts in 28 countries. We also have 4 domestic patents pending and 14 patents pending in an additional 3 countries. Certain wireless communications systems may employ a number of different combinations of our patented technology to maximize operational and spectrum efficiency. While we believe that there is great value in our patented technologies, it is a lengthy and expensive process to investigate and pursue licensing/patent infringement cases. We are evaluating a strategy for the utilization of these patents in the future, which may include pursuit of licensing or development of other strategic opportunities with users of the underlying technology. We have licensed technology in the past, both domestically and internationally, but are not currently receiving any license fees.

On May 11, 2006, we filed two separate complaints against Cellco Partnership (d/b/a Verizon Wireless) in United States District Court in the Southern District of Florida, in which we assert that Verizon Wireless is infringing two patents. Verizon Wireless is a joint venture of Verizon Communications Inc. and Vodafone Group PLC. The suits address technologies now used by Verizon to transmit television to wireless users over cellular networks and the simultaneous transmission of analog and digital signals within the same band. On July 27 and September 12, 2006, these cases were transferred to the United States District Court for the District of New Jersey. Discovery proceedings are presently taking place. There is no trial date set.

On June 2, 2006, we filed two separate complaints against Alltel Corp. in United States District Court in the Southern District of Florida, in which we assert that Alltel is infringing two patents. In an amended complaint, we asserted claims for infringement against Alltel Communications, Inc. and Alltel Wireless Holdings, Inc., in addition to Alltel Corp. The suits address technologies now used by Alltel to transmit television to wireless users over cellular networks and the simultaneous transmission of analog and digital signals within the same band. In October 2006, these two cases were consolidated. Alltel is attempting to have this case transferred to the Eastern District of Arkansas. There has been no decision by the Court on that motion. Discovery proceedings are presently taking place. Trial is scheduled for March 2008 in the Southern District of Florida. A separate lawsuit was commenced in October 2006 against All Wireless, LLC, a Florida company, alleging infringement of the patent used to transmit television to wireless users over cellular networks. The All Wireless litigation has been stayed pending the completion of the claim construction process in the Alltel litigation.

Wibiki. During 2005, our technology resources and experience in wireless broadband enabled us to conceive a new software-based wireless network that leverages existing Wi-Fi infrastructures to reduce cost, complexity and risk for users when accessing the Internet wirelessly. We named that network Wibiki. Wibiki offers free beta software designed to improve access to free Wi-Fi, including streamlining registration and security configuration of Wi-Fi clients and routers. Wibiki software for laptops and routers can be downloaded from www.wibiki.com. Wibiki’s business model will employ a user opt-in advertising service we call AdChooser to generate revenues that keep Wibiki services free to users.

NetfreeUs. In March 2007, NetfreeUs, a new wholly-owned subsidiary, asked the FCC for authority to manage a new nationwide Wireless Public Broadband (WPB) network in the 2155-2175 MHz frequency band. Like viewers of free over-the-air television and radio, consumers of NetfreeUS’ Wireless Public Broadband (“WPB”) service will never incur monthly fees. NetfreeUS will coordinate third-party lessees who would own and operate wireless access points (“WAPs”). Initially, no lessee would be authorized to operate more than fifty (50) WAPs. WPB will promote localism and the provision of advertising and public service messages targeted to local interests and communities, as well as local business and economic development, through ubiquitous coverage provided by small-footprint networks. In addition, user-designated advertising would permit local customization of advertising messages to inform users about products and services of interest in the community.

There are six other applications for this band. Because the FCC has not established processing standards for these applications, we cannot predict whether and to what extent our application will be granted, if at all.

Local Multipoint Distribution Service (LMDS) license. We have an FCC commercial operating license, awarded to us in recognition of our efforts in developing and deploying LMDS technology and for spearheading its regulatory approval at the FCC, which covers 150 MHz of spectrum in the New York City area. Under FCC authorization, the license includes an additional 150 MHz of spectrum until the first Ka band satellite is launched, an event which is not currently determinable. The license provides that the spectrum may be used for a wide variety of fixed wireless purposes, including wireless local loop telephony, high-speed Internet access and two-way teleconferencing.

The license has been renewed through February 1, 2016 conditioned upon demonstrating to the FCC by March 27, 2007 that we are providing “substantial service.” On March 7, 2007, we filed a notification that we are providing “substantial service” in accordance with FCC standards. On March 27, 2007, out of an abundance of caution, we requested a contingent waiver and an extension of time until March 27, 2010 to demonstrate “substantial service,” to the extent our earlier demonstration is not deemed compliant with FCC standards. In a pleading filed in the 2155-2175 MHz proceeding described above, a competing applicant has questioned our “substantial service” showing. It is possible that there will be other challenges to our FCC filings. We anticipate FCC action on our filings in the next several months.

We will not commence a full marketing effort using our LMDS technology until new LMDS equipment becomes commercially available with cost and performance that allow implementation of an economically viable business model. We cannot determine when this will occur and this equipment may never be available to us on this basis.

Other. We have invested a portion of our assets in a portfolio of marketable securities consisting of publicly traded equity securities. We have also invested a portion of our assets in equity and debt instruments of non-publicly held companies. We have in the past and may in the future sell publicly traded equity securities we do not own in anticipation of declines in the fair market values of these securities.

We have generated operating losses and negative operating cash flows since our inception and expect to continue to do so in the near future.

Competition

Many of our present and potential competitors have longer operating histories and significantly greater financial, technical, marketing and other resources than we do and therefore may be able to respond more quickly than we can to new or changing opportunities, technologies, standards and customer requirements.

Intellectual Property

To protect our proprietary rights, we rely on a combination of copyright and trademark laws, trade secrets, confidentiality agreements with employees and third parties and protective contractual provisions. All of our employees have executed confidentiality and nonuse agreements that transfer any rights they may have in copyrightable works or patentable technologies to us.

We have applied for registration of our service marks and trademarks in the United States and in other countries. We may not be successful in obtaining the service marks and trademarks for which we have applied. To the extent we consider it necessary, we may file patents to protect our technology. Patents with respect to our technology may not be granted, and, if granted, patents may be challenged or invalidated. In addition, issued patents may not provide us with any competitive advantages and may be challenged by third parties.

Despite our efforts to protect our proprietary rights, unauthorized parties may copy aspects of our products or services or obtain and use information that we regard as proprietary. The laws of some foreign countries do not protect proprietary rights to as great an extent as do the laws of the United States. In addition, others could possibly independently develop substantially equivalent intellectual property. If we do not effectively protect our intellectual property, our business could suffer. Companies have frequently resorted to litigation regarding intellectual property rights. We may have to litigate to enforce our intellectual property rights, to protect our trade secrets or to determine the validity and scope of other parties’ proprietary rights.

We have filed complaints and are currently litigating certain patent infringement claims. See Item 3. Legal Proceedings.

Government Regulation

In general, we are not currently subject to direct federal, state or local government regulation, other than regulations that apply to businesses generally. However, the grant, renewal and administration of spectrum licenses is regulated by the Federal Communications Commission. See ‘Business Activities, Local Multipoint Distribution Service (LMDS) license’ for additional information on our “substantial service” demonstration and our contingent request for waiver or extension of the “substantial service” deadline. A failure by the FCC to conclude that we have demonstrated “substantial service” or to extend the deadline for demonstrating “substantial service” could have an adverse effect on the Company.

In addition, medical devices such as ours are subject to strict regulation by state and federal authorities, including the Food and Drug Administration and comparable authorities in certain states.

Employees

As of March 15, 2007, we had approximately 21 full time and 8 part time employees. We also rely on a number of consultants. None of our employees is represented by a collective bargaining agreement. We believe that we have a good relationship with our employees.

Where You Can Find More Information

We file annual and quarterly reports, proxy statements and other information with the Securities and Exchange Commission, and we have an Internet website address at www.speedus.com. We make available free of charge on our internet website address our annual and quarterly reports and proxy statements filed pursuant to Sections 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with the SEC. You may also read and copy any document we file at the Securities and Exchange Commission’s public reference room located at 100 F Street, N.E., Washington, D.C. 20549. Please call the Securities and Exchange Commission at 1-800-732-0330 for further information on the operation of such public reference room. You also can request copies of such documents, upon payment of a duplicating fee, by writing to the Securities and Exchange Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 or obtain copies of such documents from the Securities and Exchange Commission’s website at www.sec.gov.


ITEM 1A.	RISK FACTORS

Risks related to our business generally

Although we have been a public company since February 1996, we have reoriented our business several times and our current business has not generated any significant revenues to date.

At the time of our initial public offering, our business was primarily a subscription television service. In November 1998, we terminated the subscription television business and began a limited pilot program for the delivery of high-speed Internet access. We encountered technical difficulties in this pilot program and reoriented our business on wireless data and other services. We have not yet generated any significant revenue from these businesses.

We have recorded operating losses in each reporting period since our inception and may never be profitable.

We have recorded operating losses and negative operating cash flows in all reporting periods since inception and, at December 31, 2006, had an accumulated deficit of approximately $69.4 million. We believe that we have sufficient liquidity to finance our current level of operations through the 2007 fiscal year. However, we do not expect to have earnings from operations, exclusive of non-cash charges, until such time as we substantially increase our customer base and/or form a strategic alliance for use of our capabilities in the future.

Our existing operations and infrastructure may not be adequate to manage the growth necessary for successful implementation of our business plan.

Successful implementation of our business plan will require the management of growth. Our existing operations and infrastructure may not be adequate to manage such growth, and any steps taken to improve such systems and controls may not be sufficient. Our future success will depend in part upon attracting and retaining the services of current management and technical personnel. We also may not be successful in attracting, assimilating and retaining new personnel in the future as future growth takes place. We do not maintain “key person” life insurance policies on any of our key personnel.

Shant S. Hovnanian and Vahak S. Hovnanian, who in the aggregate own approximately 40% of our Common Stock, may have the power acting together to control the direction and future operations of our company.

Shant S. Hovnanian and Vahak S. Hovnanian in the aggregate own approximately 40% of our outstanding Common Stock at December 31, 2006. As a result, acting together they may have the power to elect all of the members of our Board of Directors, amend our certificate of incorporation and by-laws and control the direction and future operations of our Company, in each case without the approval of any of our other stockholders.

Our stock price has historically been volatile, which may make it more difficult for you to resell shares when you want at prices you find attractive.

The trading price of our Common Stock has been and may continue to be subject to wide fluctuations. During 2006, 2005 and 2004, the high and low sale prices of our Common Stock on the Nasdaq Stock Market ranged from $2.05 to $1.02, $2.92 to $1.06 and $4.28 to $1.39, respectively. The closing sale price of our Common Stock was $1.25 on March 15, 2007. Our stock price may fluctuate in response to a number of events and factors, such as quarterly variations in operating results, announcements of technological innovations or new products and media properties by us or our competitors, the operating and stock price performance of other companies that investors may deem comparable, and news reports relating to trends in our markets.

On several occasions historically, we have not been in compliance with Marketplace Rule 4450(a)(5), which requires listed companies to maintain a closing bid price equal to or greater than $1.00. In all such cases, we subsequently received notice from Nasdaq that we had regained compliance with Marketplace Rule 4450(a)(5) and the matter was closed.

If our Common Stock were delisted from Nasdaq, trading in our Common Stock would have to be conducted on the OTC Bulletin Board or in the non-Nasdaq over-the-counter market, also referred to as the “pink sheets”. If that were to occur, liquidity for our Common Stock could be significantly decreased which could reduce the trading price and increase the transaction costs of trading shares of our Common Stock.

Sales of shares of Common Stock by Shant S. Hovnanian and Vahak S. Hovnanian could adversely affect the market price of the Common Stock.

Future sales of shares of Common Stock, or the availability of shares of Common Stock for future sale, may adversely impact the market price of the Common Stock prevailing from time to time. Sales of substantial amounts of our Common Stock, or the perception that such sales could occur, could adversely affect the prevailing market price of the Common Stock.

Shares of Common Stock held by Shant S. Hovnanian and Vahak S. Hovnanian have been held by each of them for the requisite holding periods under Rule 144 under the Securities Act and may be sold in accordance with volume restrictions.

Risks related to certain short-term investments

Securities that we invest in are subject to market price risks.

As part of our overall investment strategy, we invest in publicly traded equity securities. We purchase these securities in anticipation of increases in the fair market values of the securities.

We have also invested in equity and debt instruments of non-publicly held companies and account for them under the cost method since we do not have the ability to exercise significant influence over operations. We monitor these investments for other than temporary impairment by considering current factors including economic environment, market conditions, operational performance and other specific factors relating to the business underlying the investment, and record reductions in carrying values when necessary.

We have in the past and may in the future sell publicly traded equity securities that we do not own in anticipation of declines in the fair market values of the securities. When we sell securities that we do not own, we must borrow the securities we sold in order to deliver them and settle the trades. Thereafter, we must buy the securities and deliver them to the lender of the securities. Our potential for loss on these transactions is unlimited since the value of the underlying security can keep increasing which could have a material adverse effect on the Company’s consolidated financial statements.

The Company is seeking to eliminate the risk that it could be deemed to be an investment company.

The Company has substantial liquidity. Although a portion of the Company’s cash is invested in securities, the Company is pursuing an acquisition strategy that will, if successfully executed, eliminate any risk of it being deemed to be an investment company.

Generally, a company must register under the Investment Company Act of 1940 and comply with significant restrictions on operations and transactions with affiliates if its investment securities exceed 40% of the company’s total assets, or if it holds itself out as being primarily engaged in the business of investing, owning or holding securities. If it is deemed to be an investment company, it might need to dispose of or acquire investments in order to avoid investment company status.

Risks related to investments in other companies

Ability to successfully identify investment opportunities

We will face substantial competition in identifying and closing appropriate investment opportunities from, among others, venture capital firms, large corporate investors and other publicly traded companies. These competitors may limit our opportunity to acquire interests in new partner companies. In addition, we may be unable to acquire interests in appropriate companies for other reasons, including the inability to agree on terms, such as price and ownership percentages, incompatibility between us and management and access to sufficient funding. Our growth will be materially adversely affected if we cannot successfully identify investments in a sufficient number of companies.

The value of our business may fluctuate because of companies that we may invest in.

The value of our business may fluctuate because of companies that we may invest in. These companies may be development stage or privately held companies for which no public market exists for their stock. The valuations of our investments in privately held companies that we may invest in are indeterminate prior to their public offerings, and there can be no assurance that these offerings will occur since they will be dependent upon the development of these businesses, market conditions and other conditions over which we may have no control.

Capital and management resources

There will be a number of special issues that we will have to address for investment in start-up companies, including: the diversion of management attention in connection with both negotiating and overseeing these transactions; the potential issuance of additional shares of our Common Stock in connection with these transactions, which could dilute the rights of existing shareholders, and the need to incur additional debt in connection with these transactions. In addition, many, if not all, of these start-up companies will face the same, or similar, risks as we face in our own business.

Managing growth

Successful implementation of our business plan will require the management of growth. We cannot assure you that our existing operations and infrastructure will be adequate to manage such growth, or that any steps taken to improve such systems and controls will be sufficient. Our future success will depend in part upon attracting and retaining the services of current management and technical personnel. We cannot assure you that we will be successful in attracting, assimilating and retaining new personnel in the future as future growth takes place.

Risks related to medical device companies

Risks related to government regulation and future regulatory requirements

Medical devices such as ours are subject to strict regulation by state and federal authorities, including the Food and Drug Administration and comparable authorities in certain states.

Manufacturers of medical devices are required to comply with very specific rules and regulations concerning the testing, manufacturing, packaging, labeling and marketing of medical devices. Failure to comply with applicable regulatory requirements could result in, among other things, civil and criminal fines, product recalls, detentions, seizures, injunctions and criminal prosecutions.

In addition, these regulations are subject to future change. We cannot predict what material impact, if any, these changes might have on our business. Future changes in regulations or enforcement policies could impose more stringent requirements on us, compliance with which could adversely affect our business.

Potential product recalls

In the event that any of our products prove to be defective, we could voluntarily recall, or the FDA could require us to redesign or implement a recall of, any defective product. There is a possibility that we may recall products in the future and that future recalls could result in significant costs to us and in significant negative publicity which could harm our ability to market our products in the future.

We could be exposed to significant liability claims.

We could be exposed to significant liability claims if we are unable to obtain insurance at acceptable costs and adequate levels or otherwise protect ourselves against potential product liability claims.

The testing, manufacture, marketing and sale of medical devices involve the inherent risk of liability claims. A successful product liability claim could affect or prevent commercialization of our medical devices, or cause a significant financial burden on us, or both, and could have a material adverse effect on our business, financial condition, and ability to market our medical devices.

Health care providers may not be able to obtain adequate levels of third-party reimbursement.

The success of our product will depend to a significant extent on the ability of health care providers to obtain adequate levels of third-party reimbursement. The amount of reimbursement available may vary. The cost of medical care is funded, in substantial part, by government insurance programs, such as Medicare and Medicaid, and private and corporate health insurance plans. Third-party payers may deny reimbursement at adequate levels if they determine that a prescribed device or diagnostic procedure is not used in accordance with cost-effective treatment methods as determined by the payer, or is experimental, unnecessary or inappropriate. The inadequacy of the reimbursement would have a material adverse effect on our business.

The medical device industry is characterized by rapid technological changes and advances.

Although the Company believes that its products are technologically current, the development of new technologies or refinements of existing ones by the Company’s competitors could at any time make the Company’s existing products technologically or economically obsolete. Although the Company is not aware of any pending technological developments that would be likely to materially and adversely affect its business or financial position, there can be no assurance that such developments will not occur at any time.

We may rely on third parties to support the manufacture or commercialization of our products.

We may rely on third parties, and possibly single third parties, to manufacture or commercialize our products. Third parties may not perform their obligations as expected. The amount and timing of resources that third parties devote to manufacturing or commercializing our product may not be within our control. The third party on which we rely to commercialize our products may not be able to recruit and retain skilled sales representatives.

Furthermore, our interests may differ from those of the third party that manufacture or commercializes our products. Disagreements that may arise with the third party could limit the manufacture or commercialization of our products, or result in litigation or arbitration, which would be time-consuming, distracting and expensive. If the third party that supports the manufacture or commercialization of our products breaches or terminates its agreement with us, or fails to conduct its activities in a timely manner, such breach, termination or failure could result in the disruption of our business and could have a material adverse effect on our results of operations.

Risks related to our high-speed Internet access service

We may be unable to solve ongoing technical difficulties in our deployment and equipment for our high-speed Internet access service is not, and may never be, available at a cost and with performance levels that allow for commercial implementation on an economically attractive basis.

Our super high-speed Internet service utilizes a new technology that has a limited operating history and that remains subject to further development and refinement.

The equipment necessary to provide our high-speed Internet access service is not currently manufactured on a scale and at a cost suitable for the commercialization of our service. Such equipment may never become available at a cost and with performance levels that allow for commercial implementation on an economically attractive basis.

Many financially stronger competitors with broader market coverage are offering high-speed Internet access.

The market for Internet access and related services is highly competitive. We expect local, regional and national Internet service providers to be competitors for our super high-speed Internet access service. Telephone companies with digital subscriber line technology, which increases the effective capacity of existing copper telephone cables, are among other competitors. Also, cable operators with high-speed cable modems are among the other communications companies also providing high-speed Internet access. Many of the competing Internet service providers have, or can be expected to have, greater financial, marketing and other resources than us. We may not be able to compete successfully with these entities.


ITEM 1B.	UNRESOLVED STAFF COMMENTS

None.


ITEM 2.	PROPERTIES

All of our properties are leased space. Information on our major locations at December 31, 2006 is presented below:

Location

Use

Square
footage

Lease
expiration

Renewal
options

New York, NY

Executive and administrative

2,500

2007

Six-month terms
through 2009

New York, NY

F&B restaurant

1,300

2009

None

New York, NY

F&B restaurant

1,500

2014

None

New York, NY

Other

3,000

2008

None

Princeton, NJ

Administrative and research

2,500

2009

None

Stamford, CT

Administrative

850

2007

None


ITEM 3.	LEGAL PROCEEDINGS


ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

At its Annual Meeting of shareholders held on December 19, 2006, the Company submitted the following matters to a vote of its shareholders, all of which were approved:

1. Election of Directors:


Name of Director	Votes For		Votes Withheld

Shant S. Hovnanian		13,454,094		102,095
Vahak S. Hovnanian		13,393,370		162,819
William F. Leimkuhler		13,461,766		94,423
Jeffrey Najarian		13,462,166		94,023
Christopher Vizas		13,462,166		94,023

2. Appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm of the Company:


Votes For	Votes Against	Abstentions

13,510,619	34,882	10,688

PART II


ITEM 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our Common Stock is listed for quotation on the Nasdaq Capital Market and trades under the symbol “SPDE.” The following table sets forth high and low trade prices for the Common Stock for the fiscal quarters indicated.


	High Sale		Low Sale

2006
First quarter	$	1.680	$	1.150
Second quarter		1.760		1.100
Third quarter		1.370		1.020
Fourth quarter		2.050		1.070

2005
First quarter	$	2.920	$	2.000
Second quarter		2.100		1.240
Third quarter		1.750		1.060
Fourth quarter		1.690		1.110

On March 15, 2007, the closing trade price of our Common Stock was $1.25 per share. As of December 31, 2006, there were approximately 200 registered shareholders and, to the best of our belief, approximately 4,000 beneficial owners of our Common Stock. During the year ended December 31, 2006, we did not make any sales of securities that were not registered under the Securities Act of 1933, as amended.

We have never declared or paid any cash dividends on our Common Stock and do not intend to declare or pay cash dividends on the Common Stock at any time in the foreseeable future. Future earnings, if any, will be used for the expansion of our business.

Issuer Purchases of Equity Securities

The following table sets forth certain information regarding repurchases by the Company of its own equity securities during the fourth quarter of 2006:


Period	Total Number of Shares (or Units) Purchased		Average Price Paid per Share (or Unit)		Total number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs		Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs (1)

October 1, 2006 - October 31, 2006		0	$	—		0	$	483,930
November 1, 2006 - November 30, 2006		0	$	—		0	$	483,930
December 1, 2006 - December 31, 2006		50,000	$	1.36		50,000	$	415,740

Total		50,000	$	1.36		50,000	$	415,740

(1) On November 21, 2000, the Company announced that its Board of Directors had approved a stock repurchase program for the repurchase of up to $1,000,000 of Company stock through open market as well as privately negotiated transactions. Thereafter, the Board of Directors approved increases to the program in the aggregate amount of $5,500,000.

Equity Compensation Plans

The following table sets forth certain information as of December 31, 2006 for all compensation plans, including individual compensation arrangements, under which equity securities of the Company are authorized for issuance:


Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights		Weighted average exercise price of outstanding options, warrants and rights		Number of securities remaining available for further issuance

Equity compensation plans approved by security holders		2,161,459	$	2.07		734,368
Equity compensation plans not approved by security holders

Total		2,161,459	$	2.07		734,368

Performance graph

The following graph compares the cumulative return on the Company’s Common Stock for the last five years with the Total Return Index for: (i) The Nasdaq Stock Market US (“Nasdaq US”), (ii) Nasdaq Non-Financial Stocks (“New Peer Group”), and (iii) Nasdaq Telecommunications Stocks (“Old Peer Group”), as prepared for Nasdaq by the Center for Research in Security Prices at the University of Chicago. As a result of the Company’s evolving business model, the Company has selected a new industry peer group. The New Peer Group consists of all companies in the Total Return Index for Nasdaq Non-Financial Stocks. The Old Peer Group consists of all companies in the Total Return Index for Nasdaq Telecommunications Stocks. As required during this transitional period, the Company is showing cumulative returns from both the New Peer Group and the Old Peer Group.

The performance graph assumes (i) $100 was invested on December 31, 2001 and (ii) reinvestment of dividends. Each measurement point on the graph below represents the cumulative stockholder return as measured by the last sale price at the end of each annual period from 2002 through 2006.

(LINE GRAPH)


ITEM 6.	SELECTED CONSOLIDATED FINANCIAL DATA

The selected consolidated financial data below should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the Consolidated Financial Statements of the Company and Notes thereto included elsewhere in this Form 10-K.


	Year ended December 31,

	2006			2005			2004			2003			2002

	(in thousands, except per share data)
Statement of Operations Data
Revenues	$	846		$	1,038		$	917		$	711		$	907
Total operating expenses		7,062			6,934			10,778			7,581			11,380

Operating loss		(6,216	)		(5,896	)		(9,861	)		(6,870	)		(10,473	)
Net interest/investment income/(loss)		601			(52	)		419			(4,520	)		(194	)
Minority interest		—			159			508			779			80
Equity in loss of associated company		—			—			—			(93	)		(521	)
Settlement of litigation		—			—			15,000			—			—
Benefit from/(provision for) taxes		—			322			(62	)		—			—

Net earnings/(loss)	$	(5,615	)	$	(5,467	)	$	6,004		$	(10,704	)	$	(11,108	)

Per Common Share
Basic earnings/(loss)	$	(0.35	)	$	(0.34	)	$	0.37		$	(0.65	)	$	(0.62	)
Weighted average outstanding		16,051,706			16,182,208			16,245,281			16,498,267			17,927,000
Diluted earnings/(loss)	$	(0.35	)	$	(0.34	)	$	0.36		$	(0.65	)	$	(0.62	)
Weighted average outstanding		16,051,706			16,182,208			16,799,298			16,498,267			17,927,000

	December 31,

	2006			2005			2004			2003			2002

	(in thousands)
Balance Sheet Data
Cash and cash equivalents	$	10,204		$	18,563		$	17,741		$	19,419		$	33,053
United States Treasury bills		4,990			—			5,977			—			—
Working capital		14,658			18,635			23,329			17,774			29,544
Net property and equipment		528			426			610			420			820
Net other intangible assets		34			623			1,418			2,042			1,651
Net goodwill		—			—			—			621			1,760
Total assets		17,136			22,460			28,682			28,510			50,185
Minority interest		—			—			159			531			1,592
Total liabilities		1,034			1,285			1,673			6,990			16,175
Total equity		16,102			21,176			26,850			20,989			32,418

In February 2003, the Company acquired a majority interest in Zargis Medical This acquisition was accounted for using the purchase method of accounting and the results of operations of Zargis Medical have been included in the consolidated statements of operations for the periods subsequent to February 28, 2003.

In May 2002, the Company acquired a majority interest in F&B Güdtfood This acquisition was accounted for using the purchase method of accounting and the results of operations of F&B Güdtfood have been included in the consolidated statements of operations for the periods subsequent to May 6, 2002.

For additional information on these transactions, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations”.


ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Operations

In February 2003, we acquired a controlling interest in Zargis Medical. At December 31, 2006, as a result of continued investment, our ownership interest was approximately 80%.

Broadband Patents. We have accumulated a portfolio of patents that teach and cover the improvement of high-speed wireless communication systems to allow greater information content, reliability, clarity, more efficient use of licensed spectrum as compared to prior systems and other advances. We have 6 domestic patents with expiration dates ranging from 2007 through 2017, with approximately 46 international counterparts in 28 countries. We also have 4 domestic patents pending and 14 patents pending in an additional 3 countries. Certain

wireless communications systems may employ a number of different combinations of our patented technology to maximize operational and spectrum efficiency. While we believe that there is great value in our patented technologies, it is a lengthy and expensive process to investigate and pursue licensing/patent infringement cases. We are evaluating a strategy for the utilization of these patents in the future, which may include pursuit of licensing or development of other strategic opportunities with users of the underlying technology. We have licensed technology in the past, both domestically and internationally, but are not currently receiving any license fees.

We have generated operating losses and negative operating cash flows since our inception and expect to continue to do so in the near future.

Critical Accounting Policies

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements. The preparation of those financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of operating revenues and expenses during the reporting periods. Actual results could differ from those estimates. For a description of all of our accounting policies, see Note 2 to our consolidated financial statements included in this Form 10-K. However, we believe the following critical accounting policies affect the more significant judgments and estimates used in the preparation of our consolidated financial statements.

Financial instruments. Our financial instruments consist primarily of cash equivalents, United States treasury bills and marketable securities and may include securities sold and not purchased. The carrying value of cash equivalents approximates market value since these highly liquid, interest earning investments are invested in money market funds. Marketable securities consist of publicly traded equity securities classified as trading securities and are recorded at fair market value, i.e., closing prices quoted on established securities markets. Securities sold and not repurchased are also carried at the fair market value of the securities. Significant changes in the market value of securities that we invest in could have a material impact on our financial position and results of operations.

Long-lived assets. Long-lived assets, including fixed assets and other intangibles, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of any such asset may not be recoverable through estimated future cash flows from that asset. The estimate of cash flow is based upon, among other things, certain assumptions about expected future operating performance.

Share-Based Payments. Prior to January 1, 2006, we accounted for our employee stock options in accordance with Statement of Financial Accounting Standards No. 123, “Accounting for Stock-Based Compensation”, as amended, which defines a “fair value method” of measuring and accounting for compensation expense from employee stock options. FASB 123 also allowed accounting for such options under the “intrinsic value method” in accordance with Accounting Principles Board No. 25, “Accounting for Stock Issued to Employees.” We elected to use the intrinsic value method and adopted the disclosure only provisions of FASB 123. Generally, no compensation cost was recognized since stock options were issued with exercise prices equal to the market value of the underlying shares on the grant date.

Effective January 1, 2006, we adopted FASB 123R, “Share-Based Payment”, using the modified prospective application method. Under this method, for all unvested awards as of January 1, 2006, we record compensation cost based upon the fair value of those awards on the grant date over the remaining service period of each award on a straight line basis. For awards granted after January 1, 2006, we record compensation cost based upon the fair value of those awards on the grant date over the service period of each award on a straight line basis.

We estimate the value of these awards on the date of grant using a Black-Scholes option pricing model. The determination of the fair value of these awards on the date of grant is affected by our stock price as well as assumptions regarding a number of complex and subjective variables. These variables include our expected stock price volatility over the term of the awards, expected term, risk-free interest rate, expected dividends and expected forfeiture rates.

If factors change and we employ different assumptions in the application of FASB 123R in future periods, the compensation expense that we record under FASB 123R may differ significantly from what we have recorded in the current period. There is a high degree of subjectivity involved when using option pricing models to estimate share-based compensation under FASB 123R. Consequently, there is a risk that our estimates of the fair values of these awards on the grant dates may bear little resemblance to the actual values realized upon the exercise, expiration, early termination or forfeiture of those share-based payments in the future. Employee stock options may expire worthless or otherwise result in zero intrinsic value as compared to the fair values originally estimated on the grant date and reported in our consolidated financial statements. Alternatively, value may be realized from these instruments that are significantly in excess of the fair values originally estimated on the grant date and reported in our consolidated financial statements. During the year ended December 31, 2006, we do not believe that reasonable changes in the projections would have had a material effect on share-based compensation expense.

Contingencies. We account for contingencies in accordance with Statement of Financial Accounting Standards No. 5, “Accounting for Contingencies”. SFAS No. 5 requires that we record an estimated loss when information available prior to issuance of our financial statements indicates that it is probable that an asset has been impaired or a liability has been incurred at the date of the financial statements and the amount of the loss can be reasonably estimated. Accounting for contingencies such as environmental, legal and income tax matters requires us to use our judgment. While we believe that our accruals for these matters are adequate, if the actual loss is significantly different than the estimated loss, our results of operations will be affected in the period that the difference is known.

Twelve Months Ended December 31, 2006 Compared to Twelve Months Ended December 31, 2005

Revenues decreased $192,000 from $1,038,000 for the twelve months ended December 31, 2005 to $846,000 for the twelve months ended December 31, 2006. This decrease is primarily a result of a reduction in menu prices at the Company’s first store and the temporary closing of the second store for renovations, as well as a lack of customer acceptance of the F&B format at the second store. We are testing new menu concepts as a solution to customer acceptance.

Selling, general and administrative expenses increased $469,000 from $3,851,000 for the twelve months ended December 31, 2005 to $4,320,000 for the twelve months ended December 31, 2006. This increase is primarily a result of increases in legal expenses in connection with litigating patent infringement claims in the amount of $400,000 and stock based compensation in the amount of $600,000, net of decreases in other legal expenses in the amount of $200,000 and taxes in the amount of $300,000 as a result of the receipt of a withholding tax refund, as well as decreases as a result of personnel reductions.

Research and development expenses decreased $119,000 from $1,797,000 for the twelve months ended December 31, 2005 to $1,678,000 for the twelve months ended December 31, 2006. This decrease is primarily a result of a lower level of expenses incurred during 2006 in connection with new wireless initiatives by the Company.

Depreciation and amortization decreased $183,000 from $941,000 for the twelve months ended December 31, 2005 to $758,000 for the twelve months ended December 31, 2006. This decrease is primarily a result of a decrease in amortization of medical technology from the completion of amortization of early tranches of medical technology resulting from the Zargis acquisition, net of an increase as a result of renovation to one of the F&B Restaurant stores.

Cost of sales decreased $38,000 from $345,000 for the twelve months ended December 31, 2005 to $307,000 for the twelve months ended December 31, 2006. This decrease is primarily a result of the decrease in revenues.

Investment income/(loss) increased $653,000 from a net loss in the amount of $52,000 for the twelve months ended December 31, 2005 to a net gain in the amount of $601,000 for the twelve months ended December 31, 2006. Realized gains increased $275,000 from net losses of $175,000 for the twelve months ended December 31, 2005 to net gains of $100,000 for the twelve months ended December 31, 2006. Unrealized losses decreased $178,000 from net losses of $467,000 for the twelve months ended December 31, 2005 to net losses of $289,000 for the twelve months ended December 31, 2006. Interest income increased $200,000 from $590,000 for the twelve months ended December 31, 2005 to $790,000 for the twelve months ended December 31, 2006. The increase in interest income, net of a decrease as a result of a lesser amount of funds available for short-term investment, is a result of increased interest rates. These investment income amounts will fluctuate based upon changes in the market value of the underlying investments, overall market conditions and the amount of funds available for short-term investment and are not necessarily indicative of the results that may be expected for any future periods.

Minority interest represents the interest of minority stockholders in the losses of F&B Güdtfood and Zargis Medical since the dates of acquisition of a majority interest. Through the year ended December 31, 2006, F&B Güdtfood and Zargis Medical continued to generate losses which, during 2005, reduced the minority interest balance to zero. As result, the Company is consolidating 100% of the losses for these entities and continues to fund their operations with intercompany loans or additional investment, which are eliminated in consolidation.

During the twelve months ended December 31, 2005, the Company recorded a benefit from taxes in the amount of $322,000 as a result of a tax refund from the filing of amended tax returns. No such gain was recorded in 2006.

Twelve Months Ended December 31, 2005 Compared to Twelve Months Ended December 31, 2004

Revenues increased $121,000 from $917,000 for the twelve months ended December 31, 2004 to $1,038,000 for the twelve months ended December 31, 2005. This increase is primarily a result of the opening of a second F&B Güdtfood store during the second quarter of 2004. Revenues generated by the second store were $430,000 and $279,000 for 2005 and 2004, respectively. The 2005 increase is net of a decrease in revenues in the amount of $39,000, generated by the first store in 2005 as a result of a reduction in menu prices and unfavorable weather conditions that decreased store traffic.

Selling, general and administrative expenses decreased $463,000 from $4,314,000 for the twelve months ended December 31, 2004 to $3,851,000 for the twelve months ended December 31, 2005. This decrease is primarily a result of decreases in compensation and employee related expenses as a result of staff reductions. This decrease is net of an increase as a result of the opening of a second F&B Güdtfood store during the second quarter of 2004.

Research and development expenses increased $281,000 from $1,516,000 for the twelve months ended December 31, 2004 to $1,797,000 for the twelve months ended December 31, 2005. This increase is primarily a result of new wireless initiatives by the Company. This decrease is net of decreases in compensation and employee related expenses as a result of staff reductions.

Depreciation and amortization decreased $176,000 from $1,117,000 for the twelve months ended December 31, 2004 to $941,000 for the twelve months ended December 31, 2005. This decrease, net of an increase in the amount of $34,000 during 2005 compared to 2004 for amortization of medical technology resulting from the Zargis acquisition, is a result of assets becoming fully depreciated.

Cost of sales increased $63,000 from $282,000 for the twelve months ended December 31, 2004 to $345,000 for the twelve months ended December 31, 2005. This increase is primarily a result of the opening of a second F&B Güdtfood store during the second quarter of 2004.

During the twelve months ended December 31, 2004, the Company incurred $2,929,000 in expenses in connection with a technology settlement in the amount of $15,000,000. No such expenses were incurred in 2005. In connection with the settlement and as provided under the terms of his 2002 employment agreement, Shant S. Hovnanian, Chairman of the Board and Chief Executive Officer of the Company, received a contingent participation in the proceeds of the settlement in the amount of approximately $2.8 million during the twelve months ended December 31, 2004.

During the twelve months ended December 31, 2004, the Company recorded an impairment charge in the amount of $621,000 in connection with goodwill recorded in connection with the F&B Güdtfood acquisition. No such charge was recorded in 2005.

Investment income decreased $471,000 from a net gain in the amount of $419,000 for the twelve months ended December 31, 2004 to a net loss in the amount of $52,000 for the twelve months ended December 31, 2005. This increase is primarily a result of realized and unrealized gains and losses. Realized losses decreased $177,000 from net losses of $352,000 for the twelve months ended December 31, 2004 to net losses of $175,000 for the twelve months ended December 31, 2005. Unrealized gains decreased $754,000 from net gains of $287,000 for the twelve months ended December 31, 2004 to net losses of $467,000 for the twelve months ended December 31, 2005. Interest income increased $307,000 from $283,000 for the twelve months ended December 31, 2004 to $590,000 for the twelve months ended December 31, 2005. $81,000 of this increase is a result of interest received as a result of a tax refund from the filing of amended tax returns. The balance of the increase, net of a decrease as a result of a lesser amount of funds available for short-term investment, is a result of increased interest rates. These amounts will fluctuate based upon changes in the market value of the underlying investments, overall market conditions and the amount of funds available for short-term investment and are not necessarily indicative of the results that may be expected for any future periods.

Minority interest decreased $349,000 from $508,000 for the twelve months ended December 31, 2004 to $159,000 for the twelve months ended December 31, 2005. These amounts represent the interest of minority stockholders in the losses of F&B Güdtfood and Zargis Medical since the dates of acquisition of a majority interest. During 2005, F&B Güdtfood and Zargis Medical continued to generate losses which reduced the minority interest balance to zero. As result, the Company is consolidating 100% of the losses for these entities and continues to fund their operations with intercompany loans or additional investment, which are eliminated in consolidation.

During the twelve months ended December 31, 2004, the Company recorded a gain from technology settlement in the amount of $15,000,000. No such gain was recorded in 2005.

During the twelve months ended December 31, 2005, the Company recorded a benefit from taxes in the amount of $322,000 as a result of a tax refund from the filing of amended tax returns.

Liquidity and Capital Resources

The Company has recorded operating losses and negative operating cash flows in each year of its operations since inception.

Net cash used in operating activities was $2,900,000 for the year ended December 31, 2006 compared to net cash used in operating activities of $5,070,000 for the year ended December 31, 2005. This net decrease in cash used in operating activities is primarily the result of the sale of marketable securities, net of an increase in cash used to fund an increase in net loss.

Net cash used in investing activities was $5,261,000 for the year ended December 31, 2006 compared to net cash provided by investing activities of $6,115,000 for the year ended December 31, 2005. This net increase in cash used in investing activities is primarily the result of a $9,990,000 decrease in maturities and $977,000 increase in purchases of United States Treasury bills and an increase in property and equipment additions in the amount of $244,000.

Net cash used in financing activities was $198,000 for the year ended December 31, 2006 compared to net cash used in financing activities of $223,000 for the year ended December 31, 2005. This net decrease in cash used in financing activities is primarily a result of a decrease in repurchases of treasury stock, net of a decrease in proceeds received from the exercise of stock options.

At December 31, 2006, the Company’s future minimum lease payments due under noncancelable leases aggregated $1,621,000. $444,000, $382,000, $233,000, $138,000 and $109,000 of this amount is due during the years ending December 31, 2007, 2008, 2009, 2010 and 2011, respectively, and $315,000 is payable thereafter. In addition, in connection with a license agreement to which the Company is a party, a termination payment will be payable by the Company in the amount of $500,000, $300,000 or $200,000 if the license agreement is terminated by the Company before September 2007, September 2009 or September 2011, respectively.

The Company believes that it has sufficient liquidity to finance its current level of operations and expected capital requirements through the 2007 fiscal year. However, the Company does not expect to have earnings from operations until such time as it successfully commercializes business opportunities under development, substantially increases its customer base and/or forms a strategic alliance for use of its capabilities in the future. We cannot predict when this will occur. We have no material non-cancelable commitments and the amount of future capital funding requirements will depend on a number of factors that we cannot quantify, including the success of our business and the types of services we offer, as well as other factors that are not within our control, including competitive conditions, government regulatory developments and capital costs. The lack of additional capital in the future could have a material adverse effect on the Company’s financial condition, operating results and prospects for growth.

We have invested a portion of our assets in a portfolio of marketable securities consisting of publicly traded equity securities. We purchase these securities in anticipation of increases in the fair market values of the securities. We have in the past and may in the future sell publicly traded equity securities we do not own in anticipation of declines in the fair market values of these securities. When we sell securities that we do not own, we must borrow the securities we sold in order to deliver them and settle the trades. Thereafter, we must buy the securities and deliver them to the lender of the securities. Our potential for loss on these transactions is unlimited since the value of the underlying security can keep increasing.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements.

Recent Accounting Pronouncements

There have been no recent accounting pronouncements which upon future adoption would have an effect on the Company’s results of operations or financial position, except as disclosed below.

In September 2006, the Financial Accounting Standards Board issued FASB 157, “Fair Value Measurements”. FASB 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. FASB 157 is effective for fiscal years beginning after November 15, 2007 and interim periods within those fiscal years. The Company does not expect adoption of FASB No. 157 to have a material effect on its results of operations or financial position.

In June 2006, the Financial Accounting Standards Board issued Interpretation No. 48, “Accounting for Uncertainty in Income Taxes - an interpretation of FASB Statement No. 109”. FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with FASB Statement No. 109, “Accounting for Income Taxes” and prescribes that a company should use a more-likely-than-not recognition threshold based on the technical merits of the tax position taken. Tax positions that meet the more-likely-than-not recognition threshold should be measured in order to determine the tax benefit to be recognized in the financial statements. FIN 48 is effective for fiscal years beginning after December 15, 2006. The Company does not expect adoption of FIN 48 to have a material effect on its results of operations and financial condition.

In February 2007, the Financial Accounting Standards Board issued FASB No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities Including an Amendment of FASB Statement No. 115,” which permits companies to measure many financial instruments and certain other assets and liabilities at fair value on an instrument-by-instrument basis (the fair value option). Adoption of FASB 159 is optional and it may be adopted beginning in the first quarter of 2007. We are currently evaluating the possible impact of adopting FASB No. 159 on our consolidated financial statements.


ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company’s financial instruments at December 31, 2006 consist primarily of cash equivalents, which are subject to interest rate risk, and marketable securities, which are subject to equity price risk.

As part of our overall investment strategy, we invest in publicly traded equity securities. We purchase these securities in anticipation of increases in the fair market values of the securities. We have in the past and may in the future sell publicly traded equity securities that we do not own in anticipation of declines in the fair market values of the securities. When we sell securities that we do not own, we must borrow the securities we sold in order to deliver them and settle the trades. Thereafter, we must buy the securities and deliver them to the lender of the securities. Our potential for loss on these transactions is unlimited since the value of the underlying security can keep increasing which could have a material adverse effect on the Company’s consolidated financial statements.

The carrying value of cash equivalents approximates market value since these highly liquid, interest earning investments are invested in money market funds. The Company’s investment in marketable securities consists of publicly traded equity securities classified as trading securities and are recorded at fair market value. Securities sold and not repurchased are carried at the fair market value of the securities.


ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The Consolidated Financial Statements of the Company and related Notes thereto and the financial information required to be filed herewith are included under Item 15 of this Form 10-K.


ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.


ITEM 9A.	CONTROLS AND PROCEDURES

Management of the Company, including the Chief Executive Officer and the Chief Financial Officer, evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report. Based upon that evaluation, the Company’s Chief Executive Officer and the Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this report for the information required to be disclosed by the Company in the reports it files or submits under the Securities Exchange Act of 1934, as amended, to be recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.

There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter ended December 31, 2006 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.


ITEM 9B.	OTHER INFORMATION

None.

PART III


ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Directors and Executive Officers

The table below sets forth the names, ages and titles of the persons who were Directors and/or executive officers of the Company as of March 15, 2007.


Name	Age	Position

Shant S. Hovnanian	47	Chairman of the Board of Directors, President and Chief Executive Officer
Vahak S. Hovnanian	75	Director
William F. Leimkuhler	55	Director
Jeffrey Najarian	48	Director
Christopher Vizas	57	Director
Thomas M. Finn	59	Secretary, Treasurer and Chief Financial Officer
John A. Kallassy	42	Executive Vice President, Chief Executive Officer – Zargis Medical Corp.

Shant S. Hovnanian has served as our Chairman of the Board of Directors, President and Chief Executive Officer since October 1995. From June 1980 until January 1991, Mr. Hovnanian served as Executive Vice President of the V. S. Hovnanian Group (the “Hovnanian Group”), consisting of home building operations, real estate development and utility companies. In 1995, Mr. Hovnanian served as a U.S. Delegate to the World Radio Conference of the International Telecommunications Union in Geneva, Switzerland. Mr. Hovnanian is the son of Mr. Vahak S. Hovnanian.

Vahak S. Hovnanian has served as a Director since October 1995. Mr. Hovnanian has been Chairman of the Board and President of the Hovnanian Group since 1968. Mr. Hovnanian is the father of Mr. Shant S. Hovnanian.

William F. Leimkuhler has served as a Director since September 2000. Mr. Leimkuhler is the General Counsel and Director of Business Development of Paice Corporation, a privately held developer of advanced vehicle powertrains. Mr. Leimkuhler is also a director of Integral Systems, Inc. and U.S. Neurosurgical, Inc. From 1994 through 1999, he held various positions with Allen & Company, a New York investment banking firm, initially serving as the firm’s General Counsel. Prior to that, Mr. Leimkuhler was a corporate partner with the New York law firm of Werbel & Carnelutti (now Heller Ehrman White & McAuliffe).

Jeffrey Najarian has served as a Director since October 2000. Mr. Najarian has been Chief Executive Officer of Starpoint Solutions, Inc., formerly TIS Worldwide, Inc., since its inception in 1992. A creator and founder of Starpoint, he has been instrumental in building one of the country’s fastest growing, privately-held companies, as cited by Inc. magazine. From 1984-1992, Mr. Najarian worked at Setford-Shaw-Najarian, a recruiting/placement firm for technology specialists, becoming a partner after only three years. He led the staff in billing, propelling SSN to become a leading search firm for Wall Street banks.

Christopher Vizas has served as a Director since July 2001. Mr. Vizas is a principal in the strategic advisory firm of East Wind Partners. He serves as non-executive Chairman of the Board of i1, Inc., a privately held, Chinese software provider, as well as a member of the Boards of a few other privately held companies. Mr. Vizas’ positions during the 1990s included Chairman of eGlobe, Inc, a turn around company reorganized under Chapter 11 of the Bankruptcy Act, CEO of Quo Vadis International, Managing Director of Kouri Capital Group and its Telecommunications & Technology affiliate, and founder and Vice Chairman of Orion Network Systems. Earlier in his career, he was a founder and part of the management in Trinity Cellular and Asia Pacific Space & Communications. Mr. Vizas served in the White House Office of Telecommunications Policy in the Ford Administration, as Special Counsel to the U.S. Privacy Commission, and on congressional staff.

Thomas M. Finn has served as Secretary, Treasurer and Chief Financial Officer since March 2003. Mr. Finn has been a consultant since 1994. Prior to that time, Mr. Finn was a Senior Vice President of Integrated Resources, Inc., a diversified financial services firm, and was the Chief Financial Officer of Integrated’s publicly-traded investment programs, including American Real Estate Partners, L.P., a New York Stock Exchange master limited partnership. Previously, Mr. Finn was an Audit Manager for Deloitte & Touche LLP. Mr. Finn is a graduate of Long Island University.

John A. Kallassy has served as Executive Vice President since September 2000 and Chief Executive Officer of Zargis Medical Corp. since November 2004. In addition to developing and executing Zargis’ business strategy, Mr. Kallassy is also responsible for evaluating new business investment opportunities at Speedus within several business sectors. Prior to his leadership roles at Speedus and Zargis, Mr. Kallassy was a founder and Chief Executive Officer of American Data Consultants, Inc. (ADC), a firm specializing in information services, direct marketing and marketing research. Mr. Kallassy sold ADC to R.L. Polk in 1997 and continued his employment for three years at R.L. Polk as the ADC division president and later as a corporate vice president where he led the product management and analytical consulting groups for a $100 million business unit that was ultimately sold to Equifax Inc. Mr. Kallassy holds a Bachelor of Science Degree in Biochemistry that was completed at Leeds University in Leeds, England and earned his MBA from the Johnson School of Management at Cornell University.

Audit Committee

The Audit Committee of the Board currently consists of William F. Leimkuhler (Chairman), Jeffrey Najarian and Christopher Vizas, all independent non-employee directors. The Audit Committee has the duties and responsibilities set out in the Audit Committee Charter. Those include: selection and appointment of the independent auditor, review of its independence and of other services provided by it, and of the fees and other arrangements regarding its services; review with the independent auditor and management of the scope of the audit, and of significant financial reporting issues and judgments; review with the independent auditor and management of the annual audited financial statements and of the quarterly financial statements; and review with the independent auditor and management of the quality and adequacy of internal controls. The Board has determined that Mr. Leimkuhler is an “audit committee financial expert” within the meaning of the rules of the Securities and Exchange Commission.

The Audit Committee has adopted a charter which is available in the Investor Relations section of the Company’s website at www.speedus.com.

Audit Committee Report

Management is responsible for the Company’s internal control, consolidated financial statements and the financial reporting process. PricewaterhouseCoopers LLP served as the Company’s independent public accountants in 2006 and is responsible for expressing an opinion on those consolidated financial statements based upon an audit in accordance with auditing standards generally accepted in the United States of America. The Committee’s responsibilities include the monitoring and oversight of these processes.

The Committee has met and held discussions with management and PricewaterhouseCoopers. The Committee has also reviewed and discussed the 2006 quarterly and annual consolidated financial statements with management and PricewaterhouseCoopers. The Committee has also discussed with PricewaterhouseCoopers matters required to be discussed by Statement on Auditing Standards No. 61, “Communication with Audit Committees”, issued by the Auditing Standards Board of the American Institute of Certified Public Accountants.

PricewaterhouseCoopers has also provided to the Committee the written disclosures required by Independence Standards Board Standard No. 1, “Independence Discussions with Audit Committees” and the Committee discussed with PricewaterhouseCoopers that firm’s independence.

Based upon the Committee’s review and discussion of the 2006 annual consolidated financial statements with management and PricewaterhouseCoopers, the Committee recommended to the Board of Directors that the Company’s audited 2006 consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2006 filed with the Securities and Exchange Commission.


	By the Audit Committee
	of the Board of Directors:
	William F. Leimkuhler (Chairman)
	Jeffrey Najarian
	Christopher Vizas

Code of Ethics

The Company is committed to conducting its business in accordance with applicable laws, rules and regulations and to full and accurate financial disclosure in compliance with applicable law. In order to promote honest and ethical conduct, the Board of Directors has adopted a Code of Business Conduct and Ethics applicable to all Directors, officers, employees and agents of the Company and a Code of Ethics for the Chief Executive Officer and Senior Financial Officers.

The Code of Business Conduct and Ethics and the Code of Ethics for the Chief Executive Officer and Senior Financial Officers are available in the Investor Relations section of the Company’s website at www.speedus.com. A copy of either Code may also be obtained without charge by any person upon written request to Speedus Corp., 9 Desbrosses Street, Suite 402, New York, New York 10013, Attention: Chief Financial Officer.

Section 16(a) Beneficial Ownership Reporting Compliance

The Company’s Directors, executive officers and holders of more than 10% of the outstanding Common Stock are required to report their initial ownership of Common Stock and any subsequent changes in that ownership to the Securities and Exchange Commission. Specific due dates for these reports have been established by the Commission and the Company is required to disclose any failure by such persons to file these reports in a timely manner for the 2006 fiscal year. Based solely upon the Company’s review of copies of such reports furnished to it, the Company believes that for the 2006 fiscal year its Directors, executive officers and holders of more than 10% of the outstanding Common Stock complied with all reporting requirements of Section 16(a) under the Exchange Act.

ITEM 11. EXECUTIVE COMPENSATION

Summary Compensation Table

The following table sets forth the salary and bonus, as well as certain other compensation, paid or accrued to each of the three most highly compensated executive officers of the Company (the “Named Executive Officers”) for the years ended December 31, 2006, 2005 and 2004 in all capacities in which they served. See Employment Agreements.


Name and Principal Position	Year	Salary		Bonus		Stock Awards		Option Awards (1)		Non-Equity Incentive Plan Compen- sation		Non- qualified Deferred Compen- sation Earnings		All Other Compen- sation (2)		Total

Shant S. Hovnanian	2006	$	268,750	$	—	$	—	$	484,000	$	—	$	—	$	164,780	$	917,530
Chief Executive Officer	2005		250,000		—		—		—		—		—		158,411		408,411
	2004		250,000		2,845,186		—		—		—		—		144,000		3,239,186
Thomas M. Finn	2006	$	220,325	$	—	$	—	$	—	$	—	$	—	$	—	$	220,325
Chief Financial Officer	2005		191,000		—		—		—		—		—		—		191,000
	2004		198,000		—		—		—		—		—		—		198,000
John A. Kallassy	2006	$	225,000	$	24,000	$	—	$	—	$	—	$	—	$	—	$	249,000
Executive Vice President	2005		216,666		12,500		—		69,000		—		—		—		298,166
	2004		175,000		50,000		—		—		—		—		—		225,000

(1) In determining the aggregate grant date fair value, the stock options were valued using the Black- Scholes option pricing model. For information on the key assumptions used in valuing the options, see “Notes to Consolidated Financial Statements - Note 2, Summary of Significant Accounting Policies - Stock options.”

(2) Under the terms of his employment contract, Mr. Hovnanian is entitled to certain benefits. See ‘Employment Agreements’. The amount shown in the table above represents the total cost of these items to the Company without adjustment for the portion of these costs allocable to business use by the Company.

In addition, in February 2004, the Company’s wholly-owned subsidiary, CellularVision Technology & Telecommunications, L.P. (CT&T), received $15 million from a former international licensee in settlement of litigation that CT&T instituted in May 2001. In connection with the settlement and as provided under the terms of his employment agreement, Mr. Hovnanian received a contingent participation in the proceeds of the settlement in the amount of $2,845,186.

Grants of Plan-Based Awards

The following table sets forth information concerning individual grants of options to purchase Common Stock made to Named Executive Officers during 2006.


		Estimated Future Payouts Under Non-Equity Incentive Plan Awards						Estimated Future Payouts Under Equity Incentive Plan Awards						All Other Stock Awards: Number of Shares of Stocks		All Other Option Awards: Number of Securities Underlying Options		Exercise or Base Price of Option Awards

Name	Grant Date	Thresh- hold		Target		Maximum		Thresh- hold		Target		Maximum

Shant S. Hovnanian	8/10/06	$	—	$	—	$	—	$	—	$	—	$	—		—		400,000	$	1.27

For additional information regarding stock options, see “Notes to Consolidated Financial Statements - Note 5, Stockholders’ Equity.”

Outstanding Equity Awards at Fiscal Year-End

The following table sets forth information regarding the outstanding stock option awards held by the Named Executive Officers as of December 31, 2006. None of the Named Executive Officers have ever received any stock awards.


	Number of Securities Underlying Unexercised Options		Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options	Option Exercise Price		Option Expiration Date

Name	Exercisable	Unexercisable

Shant S. Hovnanian	5,400	—	—	$	0.890	12/2/2008
	250,000	—	—		4.840	6/11/2009
	127,700	—	—		1.000	4/3/2011
	250,000	—	—		1.100	4/25/2012
	400,000	—	—		1.270	8/10/2016
Thomas M. Finn	2,000	—	—	$	0.890	12/2/2008
	20,000	—	—		4.840	6/11/2009
	131	—	—		5.340	4/30/2009
	141	—	—		5.200	5/31/2009
	11,136	—	—		1.000	4/3/2011
	100,000	—	—		1.175	6/10/2013
John Kallassy	225,000	—	—	$	3.000	9/5/2010
	112,500	—	—		1.000	4/3/2011
	33,333	66,667	—		1.500	7/15/2015

For additional information regarding stock options, see “Notes to Consolidated Financial Statements - Note 5, Stockholders’ Equity.”

Option Exercises and Stock Vested

None of the Named Executive Officers exercised any stock options during 2006 and none of the Named Executive Officers have ever received any stock awards.

Compensation Committee

The Compensation Committee of the Board currently consists of Jeffrey Najarian (Chairman), Christopher Vizas and William F. Leimkuhler, all independent non-employee directors. The Compensation Committee establishes and administers the Company’s policies regarding compensation. In addition, the Compensation Committee, as well as the Board of Directors, administers the Company’s Stock Incentive Plan and determines which eligible employees and consultants of the Company may participate in the Plan and the type, extent and terms of the awards to be granted to them.

Compensation Discussion and Analysis

The Company’s compensation policy for all of its executive officers is formulated and administered by the Compensation Committee of the Board. Compensation of the Company’s executive officers, exclusive of the Chief Executive Officer, is developed and approved by the Chief Executive Officer, subject to oversight by the Compensation Committee. Compensation of the Chief Executive Officer is developed and approved by the Compensation Committee. The Compensation Committee, as well as the Board of Directors, also administers the Company’s Stock Incentive Plan, under which grants of various stock-based incentives may be made to employees (including executive officers), directors and consultants.

The primary goals of the Company’s compensation policy are to attract, retain and motivate skilled executive officers and to provide incentives for them to act in the best interests of the Company’s stockholders. In determining the level of executive compensation, certain quantitative and qualitative factors, including, but not limited to, the Company’s operating and financial performance, the individual’s level of responsibilities, experience, commitment, leadership and accomplishments relative to stated objectives, and marketplace conditions are taken into consideration.

The Company’s compensation program for executives consists of four key elements, discussed in greater detail below: (1) base salary, (2) consideration for a performance-based bonus, (3) periodic grants of stock-based incentives, and (4) other benefits and perquisites.

Base Salary. Base salary amounts for executive officers take into account such factors as competitive industry salaries, an executive’s scope of responsibilities, and individual performance and contribution to the organization.

Performance-based Bonus. Executive officers have an opportunity to receive performance-based bonus awards based on the overall performance of the Company and on specific individual performance targets.

Stock-based Incentives. Executive officers have an opportunity to receive stock-based incentives, generally grants of options to purchase the Company’s common Stock. These awards provide employees with the incentive to stay with the Company for longer periods of time, which in turn, provides the Company with greater stability. Equity awards also are less costly to the Company than cash compensation.

Other Benefits and Perquisites. Executive officers receive the same general health and welfare benefits offered to all employees. Except as provided in employment contracts, the Company provides no other perquisites to executive officers. See Employment Contracts.

Section 162(m) of the Code. Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), generally limits the deductibility by the Company of compensation paid in any one year to any executive officer named in the Summary Compensation Table to $1,000,000. Option awards under the Stock Incentive Plan made in conformity with the “performance-based” exemption from Section 162(m) will be exempt from the limits of Section 162(m). While the Company’s policy has always been to pursue a strategy of maximizing deductibility of compensation for all of its employees, the Compensation Committee believes it is important to maintain the flexibility to take actions it considers to be in the best interest of the Company and its stockholders, which may be based on considerations in addition to Section 162(m). In 2004, as provided under the terms of his employment contract, Shant S. Hovnanian, Chairman of the Board and Chief Executive Officer of the Company, received a contingent participation in the proceeds of the settlement in the amount of $2,845,186 when CT&T received $15 million from a former international licensee in settlement of litigation that CT&T instituted in May 2001. Except as stated in the preceding sentence, through 2006 none of the executive officers were paid cash compensation in excess of $1,000,000.

Compensation Committee Report

The Compensation Committee has reviewed and discussed the discussion and analysis of the Company’s compensation which appears above with management and, based on such review and discussion, the Compensation Committee recommended to the Company’s Board of Directors that the above disclosure be included in this Annual Report on Form 10-K.


	By the Compensation Committee
	of the Board of Directors:
	Jeffrey Najarian (Chairman)
	Christopher Vizas
	William F. Leimkuhler

Compensation of Directors

The following table sets forth information regarding the cash fees, as well as certain other compensation, paid or accrued to our Directors for the year ended December 31, 2006.


Name	Fees Earned or Paid in Cash		Stock Awards		Option Awards (1) (2)		Non-Equity Incentive Plan Compen- sation		Change in Pension Value and Nonqualified Deferred Compen- sation Earnings		All Other Compen- sation		Total

Vahak S. Hovnanian	$	24,000	$	—	$	11,300	$	—	$	—	$	—	$	35,300
William F. Leimkuhler		72,000		—		11,300		—		—		—		83,300
Jeffrey Najarian		24,000		—		11,300		—		—		—		35,300
Christopher Vizas		72,000		—		11,300		—		—		—		83,300

(1) In determining the aggregate grant date fair value, the stock options were valued using the Black-Scholes option pricing model. For information on the key assumptions used in valuing the options, see “Notes to Consolidated Financial Statements - Note 2, Summary of Significant Accounting Policies - Stock options.”

(2) At December 31, 2006, Messrs. Hovnanian, Leimkuhler, Najarian and Vizas held stock options in the aggregate amounts of 107,500, 110,250, 90,000 and 80,000, respectively.

During 2006, our Directors who are not officers or employees (“Non-Employee Directors”) received an annual retainer of $24,000. Mr. Leimkuhler received an additional retainer for services as a Director of two of the Company’s majority-owned subsidiaries, as lead outside director of the Company and as the Chairman of the Company’s Audit Committee in the aggregate amount of $48,000. Mr. Vizas received an additional retainer for services as a Director of two of the Company’s subsidiaries and as the Chairman of the Company’s Governance and Nominating Committee in the aggregate amount of $48,000. In addition, upon their initial election to the Board, new Non-Employee Directors are granted options to purchase 5,000 shares of Common Stock that are fully vested and immediately exercisable. Upon the date of each annual meeting, Non-Employee Directors are granted options at fair market value to purchase an additional 10,000 shares of Common Stock that are fully vested and immediately exercisable. Our Directors of the Company who are officers or employees do not receive any additional compensation for serving on the Board or on any Board committee.

Employment Agreements

Shant S. Hovnanian, Chairman and Chief Executive Officer of the Company, had been acting under the terms of an employment agreement that expired April 25, 2005. That agreement provided that Mr. Hovnanian will act as our President and Chief Executive Officer. The agreement had a three-year term and provided for an annual salary of $250,000. Under the agreement, Mr. Hovnanian was entitled to be considered for annual performance based bonuses targeted at 50% or greater of his base salary and a contingent bonus based on certain performance factors, use of a Company apartment and car, a country club membership (that Mr. Hovnanian has not taken) and a $1,000,000 term life insurance policy with the beneficiary designated by Mr. Hovnanian. Under that agreement, Mr. Hovnanian was also granted 250,000 options to purchase shares of our Common Stock at the market value as of the effective date of the agreement. The options were fully vested and immediately exercisable.

In April 2006, the Compensation Committee of the Board of Directors approved a new employment agreement for Mr. Shant S. Hovnanian, effective as of April 1, 2006. The new agreement has a three-year term and provides for an annual salary of $275,000. Under the agreement, Mr. Hovnanian is entitled to be considered for an annual performance based bonus targeted at 50% or greater of his base salary, use of a Company apartment and car, a country club membership (which Mr. Hovnanian has not taken) and a $2,000,000 term life insurance policy with the beneficiary designated by Mr. Hovnanian. Under the new agreement, Mr. Hovnanian was also granted 400,000 options in August 2006 to purchase shares of our Common Stock at the market value as of the effective date of the agreement. The options are fully vested and immediately exercisable.

We entered into an employment agreement effective September 5, 2000 with Mr. John A. Kallassy. The agreement provides that Mr. Kallassy will act as our Executive Vice President. The agreement, which has no term, provides for an annual salary of $175,000, subject to periodic review, and annual bonuses aggregating $50,000 based on the executive’s attainment of certain performance goals. Under this agreement, Mr. Kallassy

was granted 225,000 options to purchase shares of our Common Stock at the market value as of the effective date of the agreement. 18,750 of these options were fully vested and immediately exercisable at the date of grant. Of the balance, 18,750 options become exercisable each three months after September 5, 2000 and all options are now fully vested and exercisable. In 2005, Mr. Kallassy’s bonus and salary were combined and the aggregate total paid as salary.

Compensation Committee Interlocks and Insider Participation

No interlocking relationship exists between the Board of Directors or the Compensation Committee and the Board of Directors or compensation committee of any other company, nor has any such interlocking relationship existed in the past.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth information as of March 15, 2007 with respect to the beneficial ownership of our stock by (i) each person known by us to be the beneficial owner of more than 5% of the Common Stock; (ii) each person serving as a Director or Director nominee of the Company; (iii) each of our executive officers, and (iv) all of our Directors and executive officers as a group. Unless otherwise indicated, all shares are owned directly and the indicated owner has sole voting and dispositive power with respect thereto.


	Common Stock Beneficially Owned (1)

Beneficial Owner	Number		Percent

Shant S. Hovnanian (2)(3)		4,604,317		25.7
Vahak S. Hovnanian (4)		2,896,655		16.2
William F. Leimkuhler (5)		110,250		*
Jeffrey Najarian (6)		90,000		*
Christpher Vizas (7)		80,000		*
Thomas M. Finn (8)		133,408		*
John Kallassy (9)		460,133		2.6
XO Holdings, Inc. (10)		2,000,000		11.2
All Directors and executive officers as a group (total 7 persons)		8,374,763		46.8

* Less than 1% of the outstanding Common Stock

(1) Pursuant to the regulations of the Securities and Exchange Commission, shares are deemed to be “beneficially owned” by a person if such person directly or indirectly has or shares (i) the power to vote or dispose of such shares, whether or not such person has any pecuniary interest in such shares, or (ii) the right to acquire the power to vote or dispose of such shares within 60 days, including any right to acquire through the exercise of any option, warrant or right.

(2) Includes options to purchase 1,033,100 shares of Common Stock pursuant to the Stock Incentive Plan, which are fully vested and exercisable.

(3) Includes 137,500 shares of Common Stock owned by Mr. Shant S. Hovnanian’s minor children for which Mr. Hovnanian, as custodian, has sole voting power.

(4) Includes options to purchase 107,500 shares of Common Stock pursuant to the Stock Incentive Plan, which are fully vested and exercisable.

(5) Includes options to purchase 110,250 shares of Common Stock pursuant to the Stock Incentive Plan, which are fully vested and exercisable.

(6) Includes options to purchase 90,000 shares of Common Stock pursuant to the Stock Incentive Plan, which are fully vested and exercisable.

(7) Includes options to purchase 80,000 shares of Common Stock pursuant to the Stock Incentive Plan, which are fully vested and exercisable.

(8) Includes options to purchase 133,408 shares of Common Stock pursuant to the Stock Incentive Plan, which are fully vested and exercisable.

(9) Includes options to purchase 370,833 shares of Common Stock pursuant to the Stock Incentive Plan, which are fully vested and exercisable.

(10) Pursuant to a Stock Purchase Agreement dated as of June 13, 1999, the Company is required to use all reasonable efforts, subject to fiduciary duties under applicable law, to cause an XO Communications, Inc. representative to be elected to the Company’s Board.

In addition, Verizon Communications Inc., formerly Bell Atlantic Corporation, has the right to appoint one director to the Board, so long as Verizon shall hold at least 1% of the shares of Common Stock outstanding on a fully diluted basis.

Equity Compensation Plans

Information regarding our Common Stock authorized for issuance under equity compensation plans is included in Item 5 of this Form 10-K.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information under ‘Director Compensation’ included in Item 11. of this Form 10-K is incorporated by reference.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

Audit Fees represent fees for services rendered in connection with the annual audit and quarterly reviews of the Company’s financial statements. For the years ended December 31, 2006 and 2005, the Company paid or accrued $195,000 and $177,500, respectively, for audit fees to PricewaterhouseCoopers LLP.

Audit - - Related Fees represent fees for services rendered in connection with assurance and related services that are reasonably related to the performance of the audit or review of the financial statements and are not reported as Audit Fees. For the years ended December 31, 2006 and 2005, the Company did not pay or accrue any amounts for audit related fees.

Tax Fees represent fees for services rendered in connection with tax compliance, tax advice and tax planning. For the years ended December 31, 2006 and 2005, the Company paid or accrued $50,000 and $50,000, respectively, for tax fees to PricewaterhouseCoopers LLP.

All Other Fees represent fees for services rendered other than those described above. For the years ended December 31, 2006 and 2005, the Company did not pay or accrue any amounts for these services.

The Audit Committee of the Company’s Board of Directors has established a policy requiring its pre-approval of all audit and non-audit services provided by its independent registered public accounting firm. The policy requires the general pre-approval of annual audit services and all other permitted services.

All of the audit and non-audit services described above were approved by the Audit Committee and not pursuant to the waiver of pre-approval provisions set forth in applicable rules of the SEC.

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a) Financial Statements and Financial Statement Schedules


(1)		Consolidated Financial Statements	Page(s)


	Report of Independent Registered Public Accounting Firm		32

	Consolidated Balance Sheets as of December 31, 2006 and 2005		33

	Consolidated Statements of Operations for the years ended December 31, 2006, 2005 and 2004		34

	Consolidated Statements of Changes in Stockholders’ Equity for the years ended December 31, 2006, 2005 and 2004		35

	Consolidated Statements of Cash Flows for the years ended December 31, 2006, 2005 and 2004		36

	Notes to Consolidated Financial Statements		37-46

(b) Exhibits

	3.1a	Certificate of Incorporation. (1)

	3.1b	Certificate of Ownership and Merger of CVUSA Merger Corporation With and Into CellularVision USA, Inc. (2)

	3.2	By-laws. (1)

	4.1	Form of Common Stock Certificate. (1)

	4.3	Form of Rights Agreement between SPEEDUS.COM, Inc. and Equiserve Trust Company, N.A., as Rights Agent. The Rights Agreement includes as Exhibit A the Certificate of Designation, Preferences and Rights of Series A Junior Participating Preferred Stock of SPEEDUS.COM, Inc., as Exhibit B the form of Rights Certificate and as Exhibit C the form of Summary of Rights to Purchase Shares of Series A Junior Participating Preferred Stock. (3)

	10.1	Speedus Corp. 2005 Stock Incentive Plan. (4)

	10.2	Employment Agreement, dated as of April 1, 2006, between Speedus Corp. and Shant S. Hovnanian. (5)

	10.3	Amended and Restated Agreement of Limited Partnership of CellularVision of New York, L.P., dated as of July 7, 1993, by and between Hye Crest Management, Inc., Bell Atlantic Ventures, XXIII, Inc. and the limited partners set forth on the signature page thereto. (1)

	10.4	Agreement, dated as of January 12, 1996, by and among CellularVision USA, Inc., CellularVision of New York, L.P., Hye Crest Management, Inc., Shant S. Hovnanian, Vahak S. Hovnanian, Bernard B. Bossard and Bell Atlantic Ventures XXIII, Inc. (1)

	14	Code of Ethics for Chief Executive Officer and Senior Finance Officers (6)

	21	Subsidiaries of Speedus Corp. (1)

	23.1	Consent of PricewaterhouseCoopers LLP (6)

	31.1	Certification of Chief Executive Officer Pursuant To Rule 13a-14 of the Securities Exchange Act of 1934, As Adopted Pursuant To Section 302 of The Sarbanes-Oxley Act Of 2002 (6)

	31.2	Certification of Chief Financial Officer Pursuant To Rule 13a-14 of the Securities Exchange Act of 1934, As Adopted Pursuant To Section 302 of The Sarbanes-Oxley Act Of 2002 (6)

	32.1	Certification of Chief Executive Officer Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 Of The Sarbanes-Oxley Act Of 2002 (6)

	32.2	Certification of Chief Financial Officer Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 Of The Sarbanes-Oxley Act Of 2002 (6)


		(1)	Incorporated by reference to the Company’s Registration Statement in Form S-1 (File No. 33-98340) which was declared effective by the Commission on February 7, 1996.

		(2)	Incorporated by reference to the Company’s Form 10-K filed on March 31, 1999.

		(3)	Incorporated by reference to the Company’s Form 8-K filed on January 16, 2001.

		(4)	Incorporated by reference to the Company’s Definitive Proxy Statement filed on October 13, 2005.

		(5)	Incorporated by reference to the Company’s Form 10-Q filed on August 14, 2006.

		(6)	Filed herewith.

(c) Financial Statement Schedules

	None.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of
Speedus Corp.:

In our opinion, the consolidated financial statements listed in the index appearing under Item 15(a)(1) present fairly, in all material respects, the financial position of Speedus Corp. and its subsidiaries at December 31, 2006 and 2005, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2006 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting for share-based compensation in 2006.

PricewaterhouseCoopers LLP
New York, New York
March 30, 2007

SPEEDUS CORP.
CONSOLIDATED BALANCE SHEETS


	December 31,

	2006			2005


ASSETS
Current assets:
Cash and cash equivalents	$	10,204,167		$	18,563,088
United States Treasury bills		4,990,250			—
Marketable securities		354,011			1,174,825
Prepaid expenses and other		143,654			182,008

Total current assets		15,692,082			19,919,921
Property and equipment, net of accumulated depreciation of $444,972 and $321,256		527,828			426,201
Other intangible assets, net of accumulated amortization of $1,125,928 and $2,607,133		34,116			622,911
Other investments		800,000			800,000
Other assets		81,737			691,444

Total assets	$	17,135,763		$	22,460,477

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	62,805		$	68,692
Accrued liabilities		971,055			1,215,859

Total current liabilities		1,033,860			1,284,551

Minority interest		—			—

Commitments and Contingencies

Stockholders’ equity:
Common stock ($.01 par value; 50,000,000 shares authorized; 21,750,174 shares issued)		217,502			217,502
Preferred stock ($.01 par value; 20,000,000 shares authorized):
Series A Junior Participating ($.01 par value; 4,000 shares authorized; no shares issued and outstanding)		—			—
Additional paid-in-capital		91,464,119			90,724,450
Treasury stock (at cost; 5,780,884 and 5,632,275 shares)		(6,083,360	)		(5,884,863	)
Accumulated deficit		(69,496,358	)		(63,881,163	)

Stockholders’ equity		16,101,903			21,175,926

Total liabilities and stockholders’ equity	$	17,135,763		$	22,460,477

The accompanying notes are an integral part of these consolidated financial statements.

SPEEDUS CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS


	For the years ended December 31,

	2006			2005			2004


Revenues	$	846,342		$	1,038,343		$	917,237


Expenses:
Selling, general and administrative		4,319,554			3,851,332			4,313,889
Research and development		1,678,139			1,797,315			1,515,934
Depreciation and amortization		757,553			940,683			1,116,759
Cost of sales		306,932			345,354			282,370
Technology settlement expenses		—			—			2,928,583
Goodwill impairment loss		—			—			620,875


Total operating expenses		7,062,178			6,934,684			10,778,410


Operating loss		(6,215,836	)		(5,896,341	)		(9,861,173	)

Investment income/(loss)		600,641			(52,397	)		419,197
Minority interest		—			159,294			508,261
Gain from technology settlement		—			—			15,000,000

Earnings/(loss) before benefit from/(provision for) income taxes		(5,615,195	)		(5,789,444	)		6,066,285

Benefit from/(provision for) income taxes		—			321,539			(62,000	)


Net earnings/(loss)	$	(5,615,195	)	$	(5,467,905	)	$	6,004,285


Per share:
Basic earnings/(loss) per common share	$	(0.35	)	$	(0.34	)	$	0.37

Weighted average common shares outstanding - basic		16,051,706			16,182,208			16,245,281


Diluted earnings/(loss) per common share	$	(0.35	)	$	(0.34	)	$	0.36

Weighted average common shares outstanding - diluted		16,051,706			16,182,208			16,799,298

The accompanying notes are an integral part of these consolidated financial statements.

SPEEDUS CORP.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

For the years ended December 31, 2004, 2005 and 2006


	Common Stock						Treasury Stock					Accumulated Deficit			Total Stockholders’ Equity
					Additional
	Amount		Shares		Paid-in-capital		Amount			Shares

Balance, January 1, 2004	$	215,161		21,516,088	$	90,442,120	$	(5,250,552	)		5,257,649	$	(64,417,543	)	$	20,989,186

Exercise of options and warrants		716		71,586		70,870										71,586

Stock based compensation						33,593										33,593

Repurchase of common stock								(249,132	)		111,300					(249,132	)

Net earnings													6,004,285			6,004,285


Balance, December 31, 2004		215,877		21,587,674		90,546,583		(5,499,684	)		5,368,949		(58,413,258	)		26,849,518

Exercise of options		1,625		162,500		160,875										162,500

Stock based compensation						16,992										16,992

Repurchase of common stock								(385,179	)		263,326					(385,179	)

Net loss													(5,467,905	)		(5,467,905	)


Balance, December 31, 2005		217,502		21,750,174		90,724,450		(5,884,863	)		5,632,275		(63,881,163	)		21,175,926

Stock based compensation						739,669										739,669

Repurchase of common stock								(198,497	)		148,609					(198,497	)

Net loss													(5,615,195	)		(5,615,195	)


Balance, December 31, 2006	$	217,502		21,750,174	$	91,464,119	$	(6,083,360	)		5,780,884	$	(69,496,358	)	$	16,101,903

The accompanying notes are an integral part of these consolidated financial statements.

SPEEDUS CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS


	For the years ended December 31,

	2006			2005			2004

Cash flows from operating activities:
Net earnings/(loss)	$	(5,615,195	)		(5,467,905	)		6,004,285
Adjustments to reconcile net earnings/(loss) to net cash provided by/(used in) operating activities:
Depreciation and amortization		757,553			940,683			1,116,759
Goodwill impairment loss		—			—			620,875
Unrealized investment (gains)/losses		289,394			402,617			(287,089	)
Minority interest		—			(159,294	)		(508,261	)
Stock based compensation		673,158			16,992			33,593
Changes in operating assets and liabilities:
Marketable securities		531,420			(516,850	)		1,969,969
Due from broker		—			—			3,131,835
Prepaid expenses and other		38,354			41,105			(97,391	)
Other assets		609,707			61,425			(98,717	)
Accounts payable		(5,887	)		(247,050	)		164,484
Accrued liabilities		(178,293	)		(141,861	)		(74,706	)
Securities sold and not purchased		—			—			(5,406,135	)

Net cash provided by/(used in) operating activities		(2,899,789	)		(5,070,138	)		6,569,501

Cash flows from investing activities:
Property and equipment:
Additions		(270,385	)		(26,432	)		(536,253	)
Dispositions		—			64,272			—
United States Treasury bills:
Purchases		(15,000,000	)		(14,022,800	)		(5,977,200	)
Maturities		10,009,750			20,000,000			—
Other investments:
Purchases		—			(500,000	)		(1,556,834	)
Transfer to marketable securities		—			600,000			—

Net cash provided by/(used in) investing activities		(5,260,635	)		6,115,040			(8,070,287	)

Cash flows from financing activities:
Proceeds from exercise of options or warrants		—			162,500			71,586
Repurchase of stock		(198,497	)		(385,179	)		(249,132	)

Net cash used in financing activities		(198,497	)		(222,679	)		(177,546	)

Net increase/(decrease) in cash and cash equivalents		(8,358,921	)		822,223			(1,678,332	)

Cash and cash equivalents, beginning of period		18,563,088			17,740,865			19,419,197

Cash and cash equivalents, end of period	$	10,204,167		$	18,563,088		$	17,740,865

Supplemental information of business acquired:
Fair value of assets acquired:
Cash	$	—		$	—		$	—
Non current assets		—			—			—
Other intangible assets		—			—			136,500
Less-liabilities assumed:
Current liabilities		—			—			—
Minority interest		—			—			(136,500	)

Cash paid		—			—			—
less-cash acquired		—			—			—

Acquisition of business, net of cash acquired	$	—		$	—		$	—

The accompanying notes are an integral part of these consolidated financial statements.

SPEEDUS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Organization and Business

Organization

Speedus Corp. (“Speedus” or the “Company”), a Delaware corporation, was formed in October 1995 as CellularVision USA, Inc. (“CVUS”) to combine the ownership of predecessor companies that were under common control. In January 1999, through a ‘short form merger’ as allowed under Delaware law, CVUS changed its name to SPEEDUS.COM, Inc. In June 2002, in the same manner, SPEEDUS.COM, Inc. changed its name to Speedus Corp. Unless the context requires otherwise, the term Company includes Speedus and its wholly- and majority-owned subsidiaries.

Business activities

Speedus Corp. is a holding company that owns significant equity interests in diverse businesses. We seek business opportunities across all industries for potential transactions and relationships in which we can apply our current resources and management strengths. The companies that we target, either public or privately held, will be seeking growth or restructuring capital to pursue near term business objectives in demonstrated markets. We will continue to pursue opportunities involving our expertise in the medical device and wireless markets as well as those areas involving our broadband assets as attractive opportunities present themselves.

We have co-invested with Siemens Corporate Research, Inc., a subsidiary of Siemens Corporation, in Zargis Medical Corp. to develop advanced diagnostic decision support products and services for primary care physicians, pediatricians, cardiologists and other healthcare professionals. Zargis Acoustic Cardioscan (ZAC), Zargis’ core product, is the first and only FDA-authorized computer-assisted medical device designed to support physicians in analyzing heart sounds for the identification of suspected murmurs—which are a potential sign of heart disease. We own 90% of F&B Güdtfood Holding Corp., the creator and operator of the original Eurocentric “chic and quick” café, which is operating two stores in Manhattan. In 2005, we conceived Wibiki, a new software-based wireless network that leverages existing Wi-Fi infrastructures to reduce cost, complexity and risk for users when accessing the Internet wirelessly. Wibiki’s business model will employ a user opt-in advertising service we call AdChooser to generate revenues that keep Wibiki services free to users. We own a portfolio of patents that allow for high-speed wireless communications. We also own fixed wireless spectrum in the New York City metropolitan area that we may commercialize in the future to support high-speed, or broadband, Internet access service.

2. Summary of Significant Accounting Policies

Financial statements and principles of consolidation

The consolidated financial statements include the accounts of Speedus and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Companies in which Speedus directly or indirectly owns more than 50% of the outstanding voting securities or that Speedus has effective control over are accounted for under the consolidation method of accounting. Under this method, those companies’ balance sheets and results of operations, from the date Speedus acquired control, are included in Speedus’ consolidated financial statements. The interest in the net assets and operations of these companies’ other stockholders is reflected in the caption ‘Minority interest’ in Speedus’ consolidated balance sheet and statements of operations. Through the year ended December 31, 2006, F&B Güdtfood and Zargis Medical continued to generate losses which, during 2005, reduced the minority interest balance to zero. As result, the Company is consolidating 100% of the losses for these entities and continues to fund their operations with intercompany loans or additional investment, which are eliminated in consolidation.

Companies in which Speedus owns less than 20% of the outstanding voting securities and does not have the ability to exercise significant influence are accounted for under the cost method of accounting.

Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of operating revenues and expenses during the reporting periods. Actual results could differ from those estimates.

Cash and Cash Equivalents

The Company considers all highly liquid interest earning investments with original maturities of three months or less to be cash equivalents. At December 31, 2006 and 2005, cash equivalents consisted of money market funds.

Marketable Securities

All marketable securities are defined as trading securities under the provisions of Statement of Financial Accounting Standards No. 115, “Accounting for Certain Investments in Debt and Equity Securities.” At December 31, 2006 and 2005, marketable securities consisted of publicly traded equity securities which were recorded at fair market value. Their original cost was $887,000 and $1,419,000, unrealized losses since acquisition were $533,000 and $244,000 and the carrying value was $354,000 and $1,175,000, respectively. At December 31, 2006, based upon the fair market value of these securities, 100% was invested in technology companies.

Other investments

The Company has invested in equity and debt instruments of non-publicly held companies and accounts for them under the cost method since the Company does not have the ability to exercise significant influence over operations. The Company monitors these investments for other than temporary impairment by considering current factors including economic environment, market conditions, operational performance and other specific factors relating to the business underlying the investment, and records reductions in carrying values when necessary. The Company does not believe there has been any impairment of other investments at December 31, 2006.

Other investments consist of:


	December 31,

	2006		2005

(a) 791,667 shares of preferred stock of a non-publicly held cardiovascular technology company, recorded at cost in the amount of $300,000. In connection with this investment, the Company also received warrants to purchase 375,000 shares of common stock at $.40 per share. This investment was acquired in 2004.	$	300,000	$	300,000

(b) an investment in an entity specifically formed to invest in convertible preferred stock in a non-publicly held online and directory assistance company, recorded at cost in the amount of $250,000. The preferred stock is convertible into shares of common stock at a conversion price equal to 50% of the price of the common stock in an initial public offering. This investment was acquired in 2005.		250,000		250,000

(c) an investment in an entity specifically formed to invest in a senior third-party note of a non-publicly held online and directory assistance company, recorded at cost in the amount of $250,000. The note is convertible into shares of common stock at a conversion price equal to the price of the common stock in an initial public offering. This investment was acquired in 2005.		250,000		250,000

	$	800,000	$	800,000

Securities sold and not purchased

The Company has in the past and may in the future sell publicly traded equity securities it does not own in anticipation of declines in the fair market values of the securities. When the Company effects such transactions, it must borrow the securities it sold in order to deliver them and settle the trades. The amounts shown on the balance sheet as ‘Securities sold and not purchased’ represent the value of these securities at fair market value. At December 31, 2006 and 2005, there were no securities sold and not purchased.

Concentrations of Credit Risk

Financial instruments that potentially could subject the Company to concentrations of credit risk consist largely of cash equivalents and marketable securities. These instruments are potentially subject to concentrations of credit risk but the Company believes that this risk is limited due to diversification and investments being made in investment grade securities.

The Company has in the past and may in the future sell publicly traded equity securities that it does not own in anticipation of declines in the fair market values of the securities. When the Company sells securities that it does not own, it must borrow the securities it sold in order to deliver them and settle the trades. Thereafter, the Company

must buy the securities and deliver them to the lender of the securities. The Company’s potential for loss on these transactions is unlimited since the value of the underlying security can keep increasing which could have a material adverse effect on the Company’s consolidated financial statements.

Property and Equipment

Office equipment and leasehold improvements are recorded at cost and depreciated on a straight-line basis over the estimated useful lives of the assets, ranging from three to seven years, but not longer than initial lease terms in the case of leasehold improvements.

When assets are fully depreciated, it is the Company’s policy to remove the costs and related accumulated depreciation from its books and records.

Long-lived assets

The Company periodically evaluates the net realizable value of long-lived assets, including fixed and intangible assets, in accordance with Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, relying on anticipated future cash flows. The Company’s evaluation of anticipated future cash flows considers operating results, business plans and economic projections, as well as, non-financial data such as market trends, product and development cycles, and changes in management’s market emphasis. An impairment in the carrying value of an asset is recognized when the expected future operating cash flows derived from the asset are less than its carrying value.

Goodwill and Other Intangible Assets

The Company accounts for goodwill and other intangible assets in accordance with Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets” which requires the use of a nonamortization approach to account for purchased goodwill and certain intangibles. Under the nonamortization approach, goodwill is not being amortized into results of operations, but instead is reviewed for impairment on a reporting unit basis at least annually and charged against results of operations only in the periods in which the recorded value of goodwill is more than its implied fair value. During the fourth quarter of 2004, after determining that the estimated present value of future cash flows was less than its carrying value, the Company recorded a charge for impairment of goodwill in connection with the acquisition of F&B Güdtfood in the amount of $621,000.

At December 31, 2006, other intangible assets consist of medical technology in connection with the acquisition of a controlling interest in Zargis Medical during 2003 and additional investment in 2004. Medical technology, in the aggregate amount of $1,160,000 with accumulated amortization of $1,126,000 at December 31, 2006 is being amortized over a period of three years.

Amortization expense relating to intangible assets for the years ended December 31, 2006, 2005 and 2004 amounted to $589,000, $795,000 and $761,000, respectively. The estimated annual amortization expense for 2007, the expiration of the remaining useful life of the Company’s intangible assets at December 31, 2006, is $34,000. Amortization expense is included in ‘Depreciation and amortization’ on the accompanying Consolidated Statement of Operations and not allocated to ‘Selling, General and Administrative’ or ‘Research and Development’.

Revenue Recognition

Revenues from F&B Güdtfood’s operations are recorded on a cash basis.

Income Taxes

As required by Statement of Financial Accounting Standards No. 109, “Accounting for Income Taxes,” the Company is required to provide for deferred tax assets or liabilities arising due to temporary differences between the book and tax basis of the Company’s assets and liabilities.

As of December 31, 2006, the Company has a deferred tax asset of approximately $6.6 million, relating primarily to operating losses. An offsetting valuation allowance of $6.6million has been established as the Company had no ability to carryback its losses and a limited earnings history. During 2005, the Company recorded a benefit from income taxes in the amount of $322,000 as a result of a tax refund from the filing of amended tax returns.

A reconciliation of the Company’s effective income tax rate and the federal tax rate is as follows:


	Year ended December 31,

	2006			2005			2004

Statutory rate		(34	)%		(34	)%		(34	)%
Benefit from tax refund		—	%		(6	)%		—	%
Permanent difference: goodwill impairment		—	%		—	%		10	%
State and local income taxes, net of federal benefit		(10	)%		(10	)%		(10	)%
Change in valuation allowance		44	%		44	%		35	%

Effective rate		0	%		(6	)%		1	%

At December 31, 2006, the Company had net operating loss carryforwards of approximately $19.6 million which expire between 2020 and 2028. Under the provisions of the Internal Revenue Code, certain substantial changes in the Company’s stock ownership may result in a limitation on the amounts of net operating loss carryforwards which can be utilized in future years.

Earnings Per Share

Basic and diluted earnings/(loss) per common share are determined in accordance with Statement of Financial Accounting Standards No. 128, “Earnings Per Share”.

For the years ended December 31, 2006 and 2005, outstanding stock options and warrants in the weighted average amounts of 1,885,000 and 1,837,000, respectively, have been excluded from the diluted loss per share since their effect would be antidilutive.

For the year ended December 31, 2004, the weighted average common shares for diluted earnings per share were determined by adding 554,000 weighted average shares for the assumed exercise of stock options and warrants, calculated using the treasury stock method, to the weighted average shares outstanding used for basic earnings per share for a total of 16,799,000 weighted average shares outstanding for diluted earnings per share. Outstanding stock options and warrants in the weighted average amount of 804,000 were excluded from the computation of diluted earnings per share for the year ended December 31, 2004 since the exercise prices were greater than the average market price of the common stock.

Stock Options

Prior to January 1, 2006, the Company accounted for its employee stock options in accordance with Statement of Financial Accounting Standards No. 123, “Accounting for Stock-Based Compensation”, as amended, which defines a “fair value method” of measuring and accounting for compensation expense from employee stock options. FASB 123 also allowed accounting for such options under the “intrinsic value method” in accordance with Accounting Principles Board No. 25, “Accounting for Stock Issued to Employees.” The Company elected to use the intrinsic value method and adopted the disclosure only provisions of FASB 123. Under APB 25, generally no compensation cost was recognized in the consolidated statement of operations since stock options were issued with exercise prices equal to the market value of the underlying shares on the grant date. The following table presents pro forma earnings and earnings per share as if the fair value method of accounting was applied during the years ended December 31, 2005 and 2004:


	2005			2004

Net earnings/(loss) as reported	$	(5,467,905	)	$	6,004,285
After tax effect of pro forma compensation		(74,000	)		(50,000	)

Pro forma net loss	$	(5,541,905	)	$	5,954,285

Loss per share:
Basic - as reported	$	(0.34	)	$	0.37

Basic - pro forma	$	(0.34	)	$	0.37

Diluted - as reported	$	(0.34	)	$	0.36

Diluted - pro forma	$	(0.34	)	$	0.35

The fair value of these awards on the grant date was estimated using a Black-Scholes option pricing model. Key assumptions used in valuing these options included risk-free interest rates between 2-4%, expected lives of three years and volatility factors between 51-65%.

Effective January 1, 2006, the Company adopted FASB 123R, “Share-Based Payment”, using the modified prospective application method. Under this method, for all unvested awards as of January 1, 2006, the Company records compensation cost based upon the fair value of those awards on the grant date over the remaining service period of each award on a straight line basis. For awards granted after January 1, 2006, the Company records compensation cost based upon the fair value of those awards on the grant date over the service period of each award on a straight line basis. Stock based compensation expense recognized during the year ended December 31, 2006 was $673,000. For the year ended December 31, 2006, as a result of adopting FASB 123R, the net loss increased by this amount and both basic and diluted loss per share increased $0.04.

The fair value of the awards on the grant date was estimated using a Black-Scholes option pricing model. Assumptions utilized in the model for both Speedus and Zargis are evaluated and revised, as necessary, to reflect market conditions and experience. Expected volatility of 145% has been calculated based on the historical volatility of the Company’s stock prior to the grant date. The expected term represents the period of time that options granted are expected to be outstanding and is estimated based on historical option exercise experience ranging between six and seven years. The risk-free interest rate of 5% is equivalent to the U.S. Treasury yield in effect at the time of grant for the estimated life of the option grant. Estimated forfeiture rates are based on historical experience.

Recent Accounting Pronouncements

There have been no recent accounting pronouncements which upon future adoption would have an effect on the Company’s results of operations or financial position, except as disclosed below.

3. Property and Equipment

Property and equipment consists of the following:


	December 31,

	2006			2005

Leasehold improvements	$	617,125		$	389,693
Office equipment		355,675			357,764

		972,800			747,457
Less accumulated depreciation		(444,972	)		(321,256	)

Property and equipment	$	527,828		$	426,201

Depreciation expense was $169,000, $146,000 and $346,000 for the years ended December 31, 2006, 2005 and 2004, respectively. Depreciation expense is included in ‘Depreciation and amortization’ on the accompanying Consolidated Statement of Operations and not allocated to ‘Selling, General and Administrative’, ‘Research and Development’ or ‘Cost of Sales’.

4. Stockholders’ Equity

Stock Options

(a) In November 2005, stockholders approved the Company’s 2005 Stock Incentive Plan to replace the 1995 Stock Incentive Plan which expired in October 2005. While no new grants can be made under the 1995 Plan, options outstanding at the expiration of the 1995 Plan will remain outstanding until exercise, cancellation or expiration. Options available for grant at the expiration of the 1995 Plan have been made available for grant under the 2005 Plan. To the extent that options granted under the 1995 Plan are cancelled or expire, those options would be available for issuance under the 2005 plan. Similar to the 1995 Plan, the 2005 Plan provides for the grant of various stock–based incentives, including non-qualified and incentive stock options, to employees, directors and consultants. The Company has issued new shares for the exercise of stock options and expects to continue to do so in the future.

See Note 1 for information on the Company’s accounting policy for stock options.

Aggregate stock option activity and weighted average prices under both Plans for the three years ended December 31, 2006 is summarized as follows:


	2006					2005					2004

	Options			Price		Options			Price		Options			Price


Outstanding at January 1		1,726,459		$	2.32		1,778,959		$	2.37		1,777,465		$	2.43
Granted		449,000			1.27		210,000			1.45		100,000			2.05
Exercised		—			—		(162,500	)		1.00		(27,836	)		1.00
Expired		(5,000	)		15.00		—			—		—			—
Forfeited		(9,000	)		1.35		(100,000	)		3.59		(70,670	)		4.00

Outstanding at December 31		2,161,459		$	2.07		1,726,459		$	2.32		1,778,959		$	2.37

Exercisable at December 31		2,043,237		$	2.11		1,535,400		$	2.43		1,700,623		$	2.41

Available for grant at December 31		734,368					1,169,368					1,279,368

Stock options have ten year terms. 440,000 options granted in 2006 are immediately exercisable. 9,000 options granted in 2006 were to vest over a three year term but were thereafter forfeited.

The weighted average fair value per share for grants during the years ended December 31, 2006, 2005 and 2004 was $1.15, $0.68 and $0.96, respectively.

At December 31, 2006, there was $110,000 of unrecognized compensation cost related to outstanding stock options that is expected to be recognized over a weighted average period of 1.5 years.

The following table aggregates certain information concerning currently outstanding and exercisable stock options under both Plans at December 31, 2006:


		Stock options outstanding								Stock options exercisable

Range of exercise prices		Options		Weighted average remaining life (years)		Weighted average exercise price		Aggregate intrinsic value		Options		Weighted average exercise price		Aggregate intrinsic value

$	0.83 - 1.00		393,220		4.3	$	0.97	$	94,000		393,220	$	0.97	$	94,000
	1.07 - 2.08		1,160,000		7.8		1.31		34,000		1,041,778		1.29		34,000
	2.27 - 4.84		566,500		2.8		3.92		—		566,500		3.92		—
	5.20 - 8.00		31,739		0.5		6.99		—		31,739		6.99		—
	13.75		10,000		3.2		13.75		—		10,000		13.75		—

			2,161,459		5.7	$	2.07	$	128,000		2,043,237	$	2.11	$	128,000

Intrinsic value represents the excess of market value at December 31, 2006 over the exercise price of stock options. The aggregate intrinsic value for stock options outstanding and exercisable at December 31, 2005 was $104,000. The aggregate intrinsic value for stock options outstanding and exercisable at December 31, 2004 was $1,864,000 and $1,769,000, respectively.

(b) In February 2002, the Board of Directors of Zargis Medical Corp. approved the Zargis 2002 Stock Option Plan and reserved 280,000 shares of Zargis common stock for issuance under the plan. The Zargis 2002 Plan provides for the grant of various stock–based incentives, including non-qualified and incentive stock options, to employees, directors, advisors and consultants. To date, there have been no options exercised under the Zargis 2002 Plan.

Zargis’ accounting policy for stock options is the same as the Company’s. See Note 1.

Aggregate stock option activity and weighted average prices under the Zargis 2002 Plan for the three years ended December 31, 2006 is summarized as follows:


	2006					2005					2004

	Options			Price		Options			Price		Options		Price

Outstanding at January 1		180,134		$	2.51		126,134		$	1.75		56,500	$	0.82
Granted		50,000			3.50		100,000			3.50		69,634		2.50
Exercised		—			—		—			—		—		—
Expired		—			—		—			—		—		—
Forfeited		(45,000	)		3.50		(46,000	)		2.57		—		—

Outstanding at December 31		185,134		$	2.54		180,134		$	2.51		126,134	$	1.75

Exercisable at December 31		121,220		$	2.15		78,355		$	1.66		74,490	$	1.30

Available for grant at December 31		94,886					99,866					153,866

Stock options have ten year terms. All options granted in 2006 vest over a three year term. 45,000 options granted in 2006 were to vest over a three year term but were thereafter forfeited.

The weighted average fair value per share for grants during the years ended December 31, 2006, 2005 and 2004 was $1.61, $1.61 and $1.20, respectively.

At December 31, 2006, there was $92,000 of unrecognized compensation cost related to outstanding stock options that is expected to be recognized over a weighted average period of 1.1 years.

The following table aggregates certain information concerning currently outstanding and exercisable stock options under the Zargis 2002 Plan at December 31, 2006:


		Stock options outstanding								Stock options exercisable

Range of exercise prices		Options		Weighted average remaining life (years)		Weighted average exercise price		Aggregate intrinsic value		Options		Weighted average exercise price		Aggregate intrinsic value

$	0.50		30,000		6.0	$	0.50	$	90,000		30,000	$	0.50	$	90,000
	1.75		10,500		5.8		1.75		18,000		10,500		1.75		18,000
	2.50		69,634		7.4		2.50		70,000		55,720		2.50		56,000
	3.50		75,000		8.4		3.50		—		25,000		3.50		—

			185,134		7.5	$	2.54	$	178,000		121,220	$	2.15	$	164,000

Intrinsic value represents the excess of market value at December 31, 2006 over the exercise price of stock options. The aggregate intrinsic value for stock options outstanding and exercisable at December 31, 2005 was $178,000 and $144,000, respectively. The aggregate intrinsic value for stock options outstanding and exercisable at December 31, 2004 was $95,000 and $89,000, respectively.

Warrants

The Company accounts for warrants granted to non-employees under the provisions of Emerging Issues Task Force No. 96-18, “Accounting for equity instruments that are issued to other than employees for acquiring or in conjunction with selling, goods and services.” The fair value of the warrants at the time of issuance was determined using the Black-Scholes option-pricing model. Expenses are recognized over the service terms. No such expenses were recognized during the years ended December 31, 2006, 2005 or 2004.

Warrant activity and weighted average prices for the three years ended December 31, 2006 is summarized as follows:


	2006				2005					2004

	Warrants		Price		Warrants			Price		Warrants			Price

Outstanding at January 1		—	$	—		113,256		$	13.77		157,006		$	10.21
Granted		—		—		—			—		—			—
Exercised		—		—		—			—		(43,750	)		1.00
Cancelled		—		—		(113,256	)		13.77		—			—

Outstanding at December 31		—	$	—		—		$	—		113,256		$	13.77

Exercisable at December 31		—	$	—		—		$	—		113,256		$	13.77

Treasury Stock

During the years ended December 31, 2006, 2005 and 2004, the Company repurchased 148,609, 263,326 and 111,300 shares, respectively, of its own Common Stock.

Stockholder Rights Plan

On January 11, 2001, the Company’s Board of Directors adopted a stockholder rights plan in which preferred stock purchase rights will be distributed as a dividend at the rate of one right for each share of the Company’s Common Stock.

Each right generally will entitle stockholders, in certain circumstances, to buy one one-ten thousandth of a newly issued share of Series A Junior Participating Preferred Stock of the Company at an exercise price of $50.00. The rights generally will be exercisable and transferable apart from the Common Stock only if a person or group acquires beneficial ownership of 17% or more of the Common Stock or commences a tender or exchange offer upon consummation of which such person or group would beneficially own 17% or more of the Common Stock.

If any person becomes the beneficial owner of 17% or more of the Company’s Common Stock, then each right not owned by a 17% or more stockholder or certain related parties will entitle its holder to purchase, at the right’s then-current exercise price, shares of Common Stock (or, in certain circumstances as determined by the Board, cash, other property, or other securities) having a value of twice the right’s exercise price. In addition, if, after

any person has become a 17% or more stockholder, the Company is involved in a merger or other business combination transaction with another person in which its Common Stock is changed or converted, or sells 50% or more of its assets or earning power to another person, each right will entitle its holder to purchase, at the right’s then-current exercise price, shares of common stock of such other person having a value of twice the right’s exercise price.

The Company will generally be entitled to redeem the rights at $.01 per right at any time until the tenth day following public disclosure that a person or group has become the beneficial owner of 17% or more of the Company’s common stock. The rights will expire on January 26, 2011.

5. Gain from Technology Settlement

In February 2004, the Company’s wholly-owned subsidiary, CellularVision Technology & Telecommunications, L.P. (CT&T), received $15 million from a former international licensee in settlement of litigation that CT&T instituted in May 2001.

In connection with the settlement and as provided under the terms of his 2002 employment agreement, Shant S. Hovnanian, Chairman of the Board and Chief Executive Officer of the Company, received a contingent participation in the proceeds of the settlement in the amount of approximately $2.8 million. In addition, approximately $0.1 million in legal and other closing costs was paid at closing to unaffiliated third parties.These expenses are included in Technology Settlement Expenses for the year ended December 31, 2004 in the accompanying consolidated statement of operations.

6. Commitments and Contingencies

Noncancelable Leases

At December 31, 2006, future minimum lease payments due under noncancelable leases are as follows:

2007	$	444,000
2008		382,000
2009		233,000
2010		138,000
2011		109,000
Thereafter		315,000

	$	1,621,000

In addition, in connection with a license agreement to which the Company is a party, a termination payment will be payable by the Company in the amount of $500,000, $300,000 or $200,000 if the license agreement is terminated by the Company before September 2007, September 2009 or September 2011, respectively.

Rent expense was approximately $569,000, $496,000 and $491,000 for the years ended December 31, 2006, 2005 and 2004, respectively.

Indemnification

As permitted under Delaware law, the Company’s Certificate of Incorporation and By-Laws provide circumstances by which the Company shall indemnify each director, officer, employee or agent of the Company. The maximum potential exposure under these provisions is unlimited; however, the Company has an Officers and Directors insurance policy that limits its exposure and enables it to recover a portion of any amounts paid. The Company has not provided for any potential exposure under these provisions at December 31, 2006.

7. Legal Proceedings

On May 11, 2006, the Company filed two separate complaints against Cellco Partnership (d/b/a Verizon Wireless) in United States District Court in the Southern District of Florida, in which the Company asserts that Verizon Wireless is infringing two patents. Verizon Wireless is a joint venture of Verizon Communications Inc. and Vodafone Group PLC. The suits address technologies now used by Verizon to transmit television to wireless users over cellular networks and the simultaneous transmission of analog and digital signals within the same band. On July 27 and September 12, 2006, these cases were transferred to the United States District Court for the District of New Jersey. Discovery proceedings are presently taking place. There is no trial date set.

On June 2, 2006, the Company filed two separate complaints against Alltel Corp. in United States District Court in the Southern District of Florida, in which the Company asserts that Alltel is infringing two patents. In an amended complaint, the Company asserted claims for infringement against Alltel Communications, Inc. and Alltel Wireless Holdings, Inc., in addition to Alltel Corp. The suits address technologies now used by Alltel to transmit television to wireless users over cellular networks and the simultaneous transmission of analog and digital signals within the same band. In October 2006, these two cases were consolidated. Alltel is attempting to have this case transferred to the Eastern District of Arkansas. There has been no decision by the Court on that motion. Discovery proceedings are presently taking place. Trial is scheduled for March 2008 in the Southern District of Florida. A separate lawsuit was commenced in October 2006 against All Wireless, LLC, a Florida company, alleging infringement of the patent used to transmit television to wireless users over cellular networks. The All Wireless litigation has been stayed pending the completion of the claim construction process in the Alltel litigation.

8. Business Segment Information

The following table sets forth the Company’s financial performance by reportable operating segment for the years ended December 31, 2006, 2005 and 2004. The development of Wibiki commenced in 2005.


	Year ended December 31, 2006

	F&B			Zargis			Wibiki			Corporate and other			Totals

Revenues from external customers	$	834,754		$	11,250		$	—		$	338		$	846,342
Depreciation and amortization		135,538			13,270			—			608,745			757,553
Operating loss		(841,216	)		(1,641,052	)		(709,833	)		(3,023,735	)		(6,215,836	)
Investment income/(loss)		1,523			62			—			599,056			600,641
Other intangible assets		—			34,116			—			—			34,116
Fixed assets		490,111			21,092			—			16,625			527,828
Total assets		650,750			231,939			—			16,253,074			17,135,763


	Year ended December 31, 2005

	F&B			Zargis			Wibiki			Corporate and other			Totals

Revenues from external customers	$	1,037,703		$	—		$	—		$	640		$	1,038,343
Depreciation and amortization		111,863			13,986			—			814,834			940,683
Operating loss		(685,062	)		(1,739,639	)		(835,728	)		(2,635,912	)		(5,896,341	)
Investment income/(loss)		1,231			83			—			(53,711	)		(52,397	)
Other intangible assets		—			210,143			—			412,768			622,911
Fixed assets		372,165			17,462			—			36,574			426,201
Total assets		549,410			450,007			—			21,461,060			22,460,477


	Year ended December 31, 2004

	F&B			Zargis			Corporate and other			Totals

Revenues from external customers	$	913,620		$	—		$	3,617		$	917,237
Depreciation and amortization		90,035			25,589			1,001,135			1,116,759
Operating loss		(716,058	)		(2,237,028	)		(6,908,087	)		(9,861,173	)
Investment income/(loss)		2,367			4,751			412,079			419,197
Other intangible assets		—			592,259			825,536			1,417,795
Fixed assets		532,626			20,690			56,524			609,840
Total assets		696,480			768,002			27,217,792			28,682,274

The Company has no foreign operations. During the years ended December 31, 2006, 2005 and 2004, the Company did not have sales to any individual customer greater than 10% of total Company revenues. The Company’s accounting policies for segments are the same as those described in Note 2.

9. Selected Quarterly Data (unaudited)

Quarterly financial information is summarized in the table below (amounts in thousands, except per share amounts):


	Year ended December 31, 2006

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter

Revenues	$	219		$	209		$	210		$	208
Selling, general and administrative expenses		863			1,599			699			1,159
Research and development		457			445			482			294
Cost of sales		66			93			71			77
Operating loss		(1,407	)		(2,133	)		(1,216	)		(1,460	)
Investment income/(loss)		114			(78	)		232			333
Net loss	$	(1,293	)	$	(2,211	)	$	(984	)	$	(1,127	)
Per share (1):
Basic and diluted	$	(0.08	)	$	(0.14	)	$	(0.06	)	$	(0.07	)


	Year ended December 31, 2005

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter

Revenues	$	227		$	283		$	294		$	234
Selling, general and administrative expenses		975			965			981			930
Research and development		327			370			389			711
Cost of sales		77			94			93			81
Operating loss		(1,382	)		(1,379	)		(1,399	)		(1,736	)
Investment income/(loss)		282			(1	)		151			(484	)
Net loss	$	(975	)	$	(1,381	)	$	(890	)	$	(2,222	)
Per share (1):
Basic and diluted	$	(0.06	)	$	(0.09	)	$	(0.06	)	$	(0.14	)


	(1) Earnings per share is computed separately for each period. Therefore, the sum of the quarterly per share amounts may differ from the total for the year.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in New York, New York on April 2, 2007.


	SPEEDUS CORP.

	/s/ Shant S. Hovnanian

	Shant S. Hovnanian
	President, Chief Executive Officer and
	Chairman of the Board of Directors

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated.


Signature	Title	Date


/s/ Shant S. Hovnanian	Chairman of the Board of Directors,	April 2, 2007
	President and Chief Executive Officer
Shant S. Hovnanian	President and Chief Executive Officer

/s/ Thomas M. Finn	Treasurer and Chief Financial and	April 2, 2007
	Accounting Officer
Thomas M. Finn	Accounting Officer

/s/ Vahak S. Hovnanian	Director	April 2, 2007

Vahak S. Hovnanian

/s/ William F. Leimkuhler	Director	April 2, 2007

William F. Leimkuhler

/s/ Jeffrey Najarian	Director	April 2, 2007

Jeffrey Najarian

/s/ Christopher Vizas	Director	April 2, 2007

Christopher Vizas


•	Act with honesty and integrity, avoiding conflicts of interest in their personal and professional relationships.

•	Provide shareholders with information that is accurate, complete, objective, fair, relevant, timely and understandable, including in our filings with and other submissions to the U.S. Securities and Exchange Commission.

•	Comply with rules and regulations of federal, state, provincial and local governments, and other appropriate private and public regulatory agencies.

•	Treat confidential information acquired in the course of one’s work as such and not use it for personal advantage.

•	Not unduly or fraudulently influence, coerce, manipulate, or mislead any authorized audit or interfere with any auditor engaged in the performance of an internal or independent audit of the Company’s financial statements or accounting books and records.

•	Achieve responsible use, control, and stewardship over all Company assets and resources that are employed or entrusted to us.

•	Proactively promote and be an example of ethical behavior as a responsible partner among peers, in the work environment and the community.


Date:	April 2, 2007

By:	/s/ Shant S. Hovnanian

Name:	Shant S. Hovnanian
Title:	Chairman of the Board, President and Chief Executive Officer


Date:	April 2, 2007

By:	/s/ Shant S. Hovnanian

Name:	Shant S. Hovnanian
Title:	Chairman of the Board, President and Chief Executive Officer


	(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


	(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

	(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


	(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange of 1934, amended; and

	(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.