<PAGE> 1
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
<TABLE>
<S> <C>
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
</TABLE>
COMMISSION FILE NUMBER: 0-27470
-------
---------------------------
CYBERCASH, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 54-1725021
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
2100 RESTON PARKWAY, RESTON, VA 22091
(Address of principal executive offices, including zip code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (703) 620-4200
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
----- ----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date.
<TABLE>
<S> <C>
COMMON STOCK, $0.001 PAR VALUE 10,661,801 SHARES
------------------------------ -----------------------------------
(CLASS) (OUTSTANDING AT SEPTEMBER 30, 1996)
</TABLE>
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- --------------------------------------------------------------------------------
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE NO.
--------
<S> <C> <C>
PART I. FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
Consolidated Statements of Operations for the three and nine month
periods ended September 30, 1995 and 1996, and for the period from
August 29, 1994 (inception) to September 30, 1996..................... 2
Consolidated Balance Sheets as of December 31, 1995 and September 30,
1996.................................................................. 3
Consolidated Statements of Cash Flows for the nine month periods ended
September 30, 1995 and 1996, and for the period from August 29, 1994
(inception) to September 30, 1996..................................... 4
Notes to Consolidated Financial Statements.............................. 5
Item 2. Management's Discussion and Analysis of Financial Conditions and Results
of Operations......................................................... 6
PART II. OTHER INFORMATION
Item 1. Legal Proceedings....................................................... 9
Item 2. Changes in Securities................................................... 9
Item 3. Defaults upon Senior Securities......................................... 9
Item 4. Submission of Matters to a Vote of Security-Holders..................... 9
Item 5. Other Information....................................................... 9
Item 6. Exhibits and Reports on Form 8-K........................................ 9
Signatures.............................................................. 10
Exhibit Index...................................................................... 11
</TABLE>
<PAGE> 3
PART 1 -- FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
CYBERCASH, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
PERIOD FROM
THREE MONTHS ENDED NINE MONTHS ENDED AUGUST 29, 1994
SEPTEMBER 30, SEPTEMBER 30, (INCEPTION) TO
------------------------- -------------------------- SEPTEMBER 30,
1995 1996 1995 1996 1996
----------- ----------- ----------- ------------ ----------------
<S> <C> <C> <C> <C> <C>
Revenues..................... $ -- $ 39,088 $ -- $ 76,793 $ 76,793
Costs and expenses:
Research and development... 1,334,060 3,900,743 3,410,585 10,662,533 17,231,536
Sales and marketing........ 521,669 3,072,160 988,568 6,330,286 8,158,851
General and
administrative.......... 613,875 1,351,269 1,889,146 3,282,982 6,202,282
----------- ----------- ----------- ------------ --------------
Loss from operations......... (2,469,604) (8,285,084) (6,288,299) (20,199,008) (31,515,876)
Interest and other income.... 24,029 618,320 36,735 1,696,353 1,853,532
----------- ----------- ----------- ------------ --------------
Net loss..................... $(2,445,575) $(7,666,764) $(6,251,564) $(18,502,655) $(29,662,344)
========== =========== ========== =========== ============
Net loss per share........... $ (0.61) $ (0.72) $ (1.56) $ (2.00)
=========== =========== =========== ============
Weighted average shares
outstanding................ 4,002,074 10,656,536 4,002,074 9,233,691
=========== =========== =========== ============
</TABLE>
See accompanying notes.
2
<PAGE> 4
CYBERCASH, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
1995 1996
------------ -------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents....................................... $ 5,294,622 $ 1,105,235
Restricted cash................................................. -- 250,000
Short-term investments.......................................... -- 41,638,785
Accounts receivable............................................. -- 50,833
Prepaid expenses and other current assets....................... 399,515 720,831
------------ -------------
Total current assets.................................... 5,694,137 43,765,684
Property and equipment, net....................................... 1,566,918 5,061,902
Other long-term assets............................................ 125,169 603,402
------------ -------------
Total assets............................................ $ 7,386,224 $ 49,430,988
============ =============
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable and accrued expenses........................... $ 2,273,022 $ 4,010,790
------------ -------------
Total current liabilities............................... 2,273,022 4,010,790
Commitments
Redeemable convertible Preferred Stock, $.001 par value; 9,763,637
shares authorized:
Series A Preferred Stock, 2,500,000 shares designated, issued
and outstanding with a liquidation preference of $5,000,000
at December 31, 1995......................................... 5,000,000 --
Series B Preferred Stock, 2,381,819 shares designated; 2,200,000
shares issued and outstanding with a liquidation preference
of $11,000,000 at December 31, 1995.......................... 11,003,783 --
Series B Preferred Stock warrants............................... 90,909 --
------------ -------------
16,094,692 --
Stockholders' equity (deficit):
Common Stock, $.001 par value; 20,000,000 shares authorized;
2,062,500 shares issued and outstanding as of December 31,
1995, and 10,681,801 issued and 10,661,801 outstanding as of
September 30, 1996........................................... 2,063 10,682
Additional paid-in capital...................................... 1,981,843 76,587,496
Deficit accumulated during the development stage................ (11,159,689) (29,662,344)
Treasury stock, at cost, 20,000 shares at September 30, 1996.... -- (120,000)
Cumulative translation adjustment............................... -- (59,527)
Receivable from sale of Common Stock............................ (1,156,908) (844,945)
Unearned compensatory stock options............................. (648,799) (491,164)
------------ -------------
Total stockholders' equity (deficit).................... (10,981,490) 45,420,198
------------ -------------
Total liabilities and stockholders' equity (deficit).... $ 7,386,224 $ 49,430,988
============ =============
</TABLE>
See accompanying notes.
3
<PAGE> 5
CYBERCASH, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
PERIOD FROM
NINE MONTHS ENDED AUGUST 29, 1994
SEPTEMBER 30, (INCEPTION) TO
-------------------------- SEPTEMBER 30,
1995 1996 1996
----------- ------------ ---------------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net loss.............................................. $(6,251,564) $(18,502,655) $ (29,662,344)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation........................................ 200,400 857,380 1,214,181
Accrued interest on receivable from sale of Common
Stock............................................ -- (47,823) (60,031)
Issuance of Common Stock and warrants for
services......................................... -- -- 26,850
Compensation expense related to stock options....... 55,438 257,635 360,992
Changes in operating assets and liabilities:
Restricted cash.................................. -- (250,000) (250,000)
Accounts receivable.............................. -- (50,833) (50,833)
Prepaid expenses and other current assets........ (108,573) (321,316) (720,831)
Deposits and other long term assets.............. (72,636) (478,233) (603,402)
Accounts payable and accrued expenses............ 1,028,817 1,737,768 4,010,790
Due to related parties........................... 161,543 -- --
----------- ------------ -------------
Net cash used in operating activities................. (4,986,575) (16,798,077) (25,734,628)
INVESTING ACTIVITIES
Purchases of property and equipment................... (1,307,777) (4,352,364) (6,276,083)
----------- ------------ -------------
Net cash used in investing activities................. (1,307,777) (4,352,364) (6,276,083)
FINANCING ACTIVITIES
Proceeds from issuance of Common Stock................ -- 58,419,580 58,785,316
Proceeds from receivable from sale of Common Stock.... -- 239,786 --
Proceeds from receivable from sale of Preferred
Stock............................................... 2,633,333 -- --
Proceeds from issuance of Preferred Stock............. 10,938,033 -- 15,938,033
Proceeds from issuance of Preferred Stock warrants.... 90,909 -- 90,909
----------- ------------ -------------
Net cash provided by financing activities............. 13,662,275 58,659,366 74,814,258
----------- ------------ -------------
Effect of exchange rates changes on cash and cash
equivalents......................................... -- (59,527) (59,527)
----------- ------------ -------------
Net increase in cash and cash equivalents............. 7,367,923 37,449,398 42,744,020
Cash and cash equivalents at beginning of period...... 1,473,345 5,294,622 --
----------- ------------ -------------
Cash and cash equivalents at end of period............ $ 8,841,268 $ 42,744,020 $ 42,744,020
=========== ============ =============
</TABLE>
See accompanying notes.
4
<PAGE> 6
CYBERCASH, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
ORGANIZATION AND NATURE OF OPERATIONS
CyberCash, Inc. (the "Company" or "CyberCash"), a development stage
company, was incorporated on August 29, 1994 in the State of Delaware. The
Company is a leading developer of software and service solutions for secure,
cost-effective, convenient and rapid payments over the Internet. The Company's
system is designed to facilitate Internet commerce by enabling financial
transactions between individuals, businesses and financial institutions.
BASIS OF PRESENTATION
The accompanying condensed consolidated financial statements and notes
thereto have been prepared in accordance with generally accepted accounting
principles for interim financial information and should be read in conjunction
with the Company's consolidated financial statements included in the Company's
Prospectus dated February 15, 1996, relating to the Company's initial public
offering. In the opinion of management, all adjustments (consisting only of
normal, recurring adjustments) considered necessary to reflect fairly the
Company's consolidated financial position and consolidated results of operations
have been included. 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 at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates. The results of operations for the three and nine months ended
September 30, 1995 and 1996 are not necessarily indicative of the results for
the full year.
CASH, CASH EQUIVALENTS AND RESTRICTED CASH
The Company considers all highly liquid financial instruments purchased
with original maturities of three months or less to be cash equivalents.
Restricted cash, in the form of a certificate of deposit, supports Company
credit cards held by employees for business expenses. The Company's short-term
investments are invested in a money market mutual fund which consists of
obligations of U.S. government agencies, having maturities of less than three
months. These securities are recorded at cost, which approximates fair market
value.
FOREIGN CURRENCY TRANSLATION
Results of operations for foreign entities are translated using average
exchange rates during the period. Assets and liabilities are translated to U.S.
dollars using the exchange rate in effect at the balance sheet date. Resulting
translation adjustments are reflected in stockholders' equity as cumulative
translation adjustment.
NET LOSS PER SHARE
The Company's net loss per share calculations are based on the weighted
average number of shares of Common Stock outstanding. Pursuant to the Securities
and Exchange Commission Staff Accounting Bulletin No. 83, for the three and nine
months ended September 30, 1995, all common stock and preferred stock issued and
options and warrants granted by the Company during the twelve months preceding
February 15, 1996, the filing date of the Company's Registration Statement, have
been included in the calculation of weighted average common shares and common
share equivalents outstanding as if they were outstanding for all periods
presented. Preferred stock issued and options and warrants granted by the
Company outside the aforementioned period have not been included in the
calculation because such items were anti-dilutive. For the three and nine months
ended September 30, 1996, the Company is required to calculate the weighted
average shares outstanding pursuant to APB 15 Earnings Per Share and thus the
net loss per share for the periods is not comparable.
5
<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion should be read in conjunction with the
accompanying consolidated financial statements and associated notes thereto and
with the consolidated financial statements, and notes thereto and management's
discussion and analysis of financial condition and results of operations of the
Company as of December 31, 1995 included in the Prospectus, dated February 15,
1996, issued in connection with the Company's registration statement on Form
S-1. This Report contains, in addition to historical information,
forward-looking statements that involve risks and uncertainties. The Company's
actual results could differ significantly from the results discussed in the
forward-looking statements. Factors that could cause or contribute to such
differences include the rate of development of Internet commerce, the ability of
the Company to develop and market new products and services and to enhance
existing ones, changes in the technology related to Internet commerce,
especially the introduction of new technology by competitors, the willingness of
the Company's customers, principally banks and other financial institutions to
adopt the Company's technology and services, strategic decisions by major
participants in the industry, competitive pricing pressures, the adoption of new
laws or regulations affecting the Company's services either in the United States
or abroad, general economic conditions and the introduction of competing
products having technological and/or pricing advantages. Further information on
these and other risks facing the Company is discussed under the caption "Risk
Factors" in the Prospectus.
OVERVIEW
The Company is a leading developer of software and service solutions for
secure, cost-effective, convenient and rapid payments over the Internet. The
Company's system is designed to facilitate Internet commerce by enabling
financial transactions between individuals, businesses and financial
institutions. The Company commercially released its Electronic Credit Card
services in January 1996 and its CyberCoin services in September 1996. It
expects to release its Electronic Check services in early 1997.
The financial results for the period from August 29, 1994 (inception) to
December 31, 1994 relate to the Company's initial organization, licensing and
software development activities. As of September 30, 1996, the Company is in the
development stage and presently has only a limited number of individuals,
businesses and financial institutions utilizing its services.
RESULTS OF OPERATIONS
Since its inception in August 1994, the Company has undertaken a program of
developing and expanding its operations. It has invested in the design and
development of its services, including its network operation capacities and in
the establishment and expansion of sales and marketing in preparation for and
anticipation of the growth in Internet commerce that it expects will create a
substantial market for Internet payment services. The Company also has made
significant investments in computers, networking systems and telecommunications
equipment. Largely as a result of the expenses associated with these efforts the
Company's operating expenses have increased in each quarter since its inception.
The Company expects operating expenses to continue to increase in the future as
it continues the development and release of new and enhanced products and
services, increases its marketing and sales organizations, and expands its
support organization. The Company's total loss from operations were $2,470,000
and $6,288,000 for the three and nine months ended September 30, 1995,
respectively, as compared to $8,285,000 and $20,199,000 for the three and nine
months ended September 30, 1996, respectively. The Company recorded net losses
of $2,446,000 and $7,667,000 for the three months ended September 30, 1995 and
1996, respectively and $6,252,000 and $18,503,000 for the nine months ended
September 30, 1995 and 1996, respectively. The Company believes it will continue
to incur losses at least through 1998, and there can be no assurance when it
will achieve profitability, if ever.
REVENUES
Revenues. The Company's revenues for the nine months ended September 30,
1996 were $77,000. The revenues were derived from consulting services and
transaction processing and connection fees for the
6
<PAGE> 8
Company's Electronic Credit Card services. The Company currently distributes its
merchant and consumer software free of charge. The Company had no revenues in
the nine months ended September 30, 1995. The Company anticipates realizing only
limited revenues during the fourth quarter of 1996, and the Company's ability to
generate significant revenue thereafter is uncertain.
As of June 30, 1996, approximately 128 merchants were using the Company's
services. As of September 30, 1996, that number had increased to approximately
220 merchants with approximately 1,600 additional merchants under contract to
begin using the Company's services. The revenue earned by the Company depends,
however, on the volume of transactions processed by the Company and not the
number of merchants using its services.
The Company anticipates that there will be significant competition for
secure credit card services on the Internet. Accordingly, the Company does not
foresee that its Electronic Credit Card services will be a principal contributor
to its profitability. The Company anticipates that its newly-released CyberCoin
service and soon-to-be-released Electronic Check service will generate greater
revenues than the Electronic Credit Card service, although there can be no
assurance that the Company will become profitable.
OPERATING EXPENSES
Research and Development. Research and development expenses consist
primarily of compensation expense and consulting fees to support the development
of the Company's software, service and technologies. Research and development
expenses increased $2,567,000 from $1,334,000 for the three months ended
September 30, 1995 to $3,901,000 for the three months ended September 30, 1996
and increased $7,252,000 from $3,411,000 for the nine months ended September 30,
1995 to $10,663,000 for the nine months ended September 30, 1996 due to the
increase in the number of employees engaged in development and increased
expenditures for outside consultants. To date, all of the Company's software
development costs have been expensed as incurred. The Company will continue to
expense such costs, which are expected to increase, until such time as the
realizability of the Company's software is established.
Sales and Marketing. Sales and marketing expenses consist primarily of
compensation expense and advertising and marketing costs. Sales and marketing
expenses increased $2,550,000 from $522,000 for the three months ended September
30, 1995 to $3,072,000 for the three months ended September 30, 1996 and
increased $5,341,000 from $989,000 for the nine months ended September 30, 1995
to $6,330,000 for the nine months ended September 30, 1996. The increases were
due principally to the addition of sales and marketing personnel to expand
advertising and marketing activity, largely related to the introduction of the
Company's CyberCoin service and the continued promotion of the Company's
Electronic Credit Card service. In addition, the Company has devoted substantial
efforts to developing technology and marketing relationships with companies such
as SUN, Netscape, Oracle and Microsoft who are engaged in providing technology
for facilitating electronic commerce. The Company anticipates that its sales and
marketing expenses will continue to increase substantially as it introduces its
Electronic Check service, continues to promote its Electronic Credit Card and
CyberCoin services and strives to expand its relationships with financial
institutions and processors.
General and Administrative. General and administrative expenses consist
primarily of compensation expense and fees for professional services and other
expenses associated with the general management and administration of the
Company. General and administrative expenses increased $737,000 from $614,000
for the three months ended September 30,1995 to $1,351,000 for the three months
ended September 30, 1996 and increased $1,394,000 from $1,889,000 for the nine
months ended September 30, 1995 to $3,283,000 for the nine months ended
September 30, 1996. This increase primarily reflects the addition of personnel
and increased professional services in the areas of human resources, finance,
legal and administration. The Company anticipates that its general and
administrative expenses will continue to increase as it continues to develop and
expand its operations.
Interest Income. Interest income increased $594,000 from $24,000 for the
three months ended September 30, 1995 to $618,000 for the three months ended
September 30, 1996 and increased $1,659,000
7
<PAGE> 9
from $37,000 for the nine months ended September 30, 1995 to $1,696,000 for the
nine months ended September 30, 1996 due to interest income earned on investment
proceeds from the Company's initial public offering and concurrent private
placement on February 15, 1996.
LIQUIDITY AND CAPITAL RESOURCES
At September 30, 1996, the Company had working capital of approximately
$39,755,000, compared to $3,421,000 at December 31, 1995. The increase in
working capital resulted from the Company's initial public offering on February
15, 1996 and the private placement to SOFTBANK Holdings, Inc., which together
resulted in net cash proceeds of approximately $58,253,000, including the
exercise of the underwriters' over-allotment option.
The Company currently anticipates that its available cash resources of
$42,744,000 at September 30, 1996 combined with future funds from operations
will be sufficient to meet its presently anticipated working capital and capital
expenditure requirements for at least the next 12 to 15 months. Thereafter, the
Company may need to raise additional funds through debt and/or equity financing.
The Company's estimates of its cash requirements are forward-looking statements,
and there is no assurance that the Company's actual cash requirements will not
exceed its currently anticipated cash requirements. The Company may need to
raise additional funds sooner than anticipated in order to fund more rapid
expansion, to develop new or enhanced services, to respond to competitive
pressures or to acquire complementary businesses or technologies. If additional
funds are raised through the issuance of equity securities, the percentage
ownership of the stockholders of the Company will be reduced, stockholders may
experience additional dilution, or such equity securities may have rights,
preferences or privileges senior to those of the holders of the Company's common
stock. There can be no assurance that additional financing will be available
when needed on terms favorable to the Company or at all. If adequate funds are
not available or are not available on acceptable terms, the Company may be
unable to develop or enhance products or services, take advantage of future
opportunities, or respond to competitive pressures, which could have a material
adverse effect on the Company's business, financial condition or operating
results. See "Risk Factors -- Dependence on Intellectual Property Rights; Risk
of Infringement; Possible Litigation," and "-- Dilution; Possible Right to
Purchase Additional Shares," in the Prospectus.
8
<PAGE> 10
PART II -- OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
See Exhibit 11.1.
No reports were filed on Form 8-K during the quarter for which this Report
is filed.
9
<PAGE> 11
SIGNATURES
Pursuant to the requirements 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.
CyberCash, Inc.
--------------------------------------
(Registrant)
<TABLE>
<S> <C>
Date: November 13, 1996 /s/ WILLIAM N. MELTON
---------------------------------------------
William N. Melton
Director, President and Chief Executive
Officer
Date: November 13, 1996 /s/ GENE RIECHERS
---------------------------------------------
Gene Riechers
Chief Financial Officer
</TABLE>
10
<PAGE> 12
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT PAGE NO.
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<S> <C> <C>
11.1 -- Exhibit regarding calculation of net loss per share......................... 12
</TABLE>
11
<PAGE> 1
EXHIBIT 11.1
CYBERCASH, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT RE: COMPUTATION OF PER SHARE LOSS
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
-------------------------- ---------------------------
1995 1996 1995 1996
------------ ------------ ------------ -------------
<S> <C> <C> <C> <C>
Earnings per share:
Weighted average number of common shares
outstanding.............................. 1,450,000 10,656,536 1,450,000 9,233,691
Shares of Series B preferred stock and
warrants issued during the twelve month
period prior to the initial filing of the
S-1 (using the treasury stock method).... 1,679,581 -- 1,679,581 --
Shares of common stock issued during the
twelve month period prior to the initial
filing of the S-1 (using the treasury
stock method)............................ 111,838 -- 111,838 --
Common stock equivalents from options
issued during the twelve month period
prior to the initial filing of the S-1
(using the treasury stock method)........ 760,655 -- 760,655 --
------------ ------------ ------------ -------------
Total............................ 4,002,074 10,656,536 4,002,074 9,233,691
------------ ------------ ------------ -------------
Loss of the period......................... $ (2,445,575) $ (7,666,764) $ (6,251,564) $ (18,502,655)
------------ ------------ ------------ -------------
Net loss per share......................... $ (0.61) $ (0.72) $ (1.56) $ (2.00)
============ ============ ============ =============
</TABLE>
12
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 1,355,235
<SECURITIES> 41,638,785
<RECEIVABLES> 50,833
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 43,765,684
<PP&E> 6,276,083
<DEPRECIATION> 1,214,181
<TOTAL-ASSETS> 49,430,988
<CURRENT-LIABILITIES> 4,010,790
<BONDS> 0
0
0
<COMMON> 10,682
<OTHER-SE> 45,409,516
<TOTAL-LIABILITY-AND-EQUITY> 49,430,988
<SALES> 0
<TOTAL-REVENUES> 76,793
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 20,275,801
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (18,502,655)
<INCOME-TAX> 0
<INCOME-CONTINUING> (18,502,655)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (18,502,655)
<EPS-PRIMARY> (2.00)
<EPS-DILUTED> 0
</TABLE>
