<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended JUNE 30, 1996
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 1-14430
MAXIM PHARMACEUTICALS, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 87-0279983
(State or other jurisdiction of incorporation or (I.R.S. Employer
organization) Identification No.)
4350 EXECUTIVE DRIVE, SUITE 310, SAN DIEGO, CA 92121
(Address of principal executive offices)
(Zip Code)
(619) 453-4040
(Registrant's telephone number, including area code)
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 ____ No __x__
As of August 8, 1996, there were 6,670,837 shares of the Registrant's common
stock outstanding
<PAGE> 2
MAXIM PHARMACEUTICALS, INC.
PART I - FINANCIAL INFORMATION
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
June 30, September 30,
1996 1995
------------- -------------
(Unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $1,913,293 $ 512,928
Prepaid expenses and other current assets 1,300 13,676
------------- -------------
Total current assets 1,914,593 526,604
------------- -------------
Property and equipment, net of accumulated depreciation
of $25,005 at June 30, 1996 and $579,886 at
September 30, 1995 23,769 142,292
Patents and licenses, net of accumulated amortization of
$33,000 at June 30, 1996 and $10,000 at September
30, 1995 1,741,818 1,619,591
Receivable from related party - 147,803
Other assets 443,976 17,611
------------- -------------
Total assets $4,124,156 $2,453,901
============= =============
</TABLE>
1
<PAGE> 3
MAXIM PHARMACEUTICALS, INC.
PART I - FINANCIAL INFORMATION
CONDENSED CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
<TABLE>
<CAPTION>
June 30, September 30,
1996 1995
------------- -------------
(Unaudited)
<S> <C> <C>
Current liabilities:
Current portion of long-term debt $ 247,000 $ 353,000
Accounts payable & accrued expenses 629,540 684,760
Notes payable to bank - 2,250,000
Note payable to stockholder 250,000 250,000
Note payable to Swedish governmental agency 2,421,560 2,312,853
------------- ------------
Total current liabilities 3,548,100 5,850,613
------------- ------------
Long term debt 247,000 247,000
------------- ------------
Total liabilities 3,795,100 6,097,613
------------- ------------
Stockholders' equity (deficit)
Series A convertible preferred stock $.001 par value,
5,000,000 shares authorized, 250,000 shares issued and
outstanding 250 250
Common stock, $.001 par value, 20,000,000 shares
authorized, issued and outstanding 3,692,971 at June
30, 1996 and 2,082,821 at September 30, 1995 3,693 2,083
Common stock subscriptions receivable - (311,000)
Additional paid-in capital 15,952,257 9,768,370
Deferred compensation (Note 3) (145,431) -
Deficit accumulated during the development stage (15,481,713) (13,103,415)
------------- ------------
Total stockholders' equity (deficit) 329,056 (3,643,712)
------------- ------------
Commitments and contingencies - -
Total liabilities and stockholders' equity (deficit) $4,124,156 $2,453,901
============= ============
</TABLE>
See accompanying notes to condensed consolidated financial statements
2
<PAGE> 4
MAXIM PHARMACEUTICALS, INC.
PART I - FINANCIAL INFORMATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
For the Three Months For the Nine Months
Ended June 30, Ended June 30,
---------------------- ----------------------
(Unaudited) (Unaudited)
1996 1995 1996 1995
---------- ---------- --------- ----------
<S> <C> <C> <C> <C>
Expenses:
Research and development:
Other $ 255,977 $129,387 $ 912,706 $ 583,036
Related party 85,800 46,400 165,600 208,700
General and administrative 506,708 227,341 1,026,537 683,610
---------- --------- ----------- -----------
Loss from operations 848,485 403,128 2,104,843 1,475,346
---------- --------- ----------- -----------
Other expense (income):
Interest expense 24,042 131,211 176,667 361,174
Other (income) (11,531) (818) (22,843) (2,869)
Foreign exchange loss 24,414 20,885 119,631 90,219
---------- --------- ----------- -----------
Total other expense 36,925 151,278 273,455 448,524
---------- --------- ----------- -----------
Net loss from operations $ 885,410 $554,406 $2,378,298 $1,923,870
========== ========= =========== ===========
Net loss per common share (Note 4) $ 0.25 $ 1.92 $ 0.79 $ 6.67
========== ========= =========== ===========
</TABLE>
See accompanying notes to condensed consolidated financial statements
3
<PAGE> 5
MAXIM PHARMACEUTICALS, INC.
PART I - FINANCIAL INFORMATION
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
<TABLE>
<CAPTION>
Additional Deferred
Common Stock Preferred Stock Subscription Paid-In Compen-
Shares Amount Shares Amount Receivable Capital sation
--------- --------- --------- ------ ------------ ----------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at September 30, 1995 2,082,821 $ 2,083 250,000 $ 250 $(311,000) $ 9,768,370 $ -
Issuance of common stock at $3.00
per share in exchange for
repayment of Company's bank line
of credit 744,646 745 2,249,255
Receipt of subscription receivable 311,000
Issuance of common stock and warrants
at $3.75 per unit for cash 465,504 465 1,740,033
Proceeds from private placement 400,000 400 1,799,600
Deferred compensation related to grant
of stock options (Note 3) 394,999 (394,999)
Amortization of deferred compensation 249,568
Net loss
--------- --------- --------- ------ ------------ ----------- ---------
Balance at June 30, 1996 3,692,971 $ 3,693 250,000 $ 250 $ - $15,952,257 $(145,431)
========= ========= ========= ====== ============ =========== =========
<CAPTION>
Accumulated
(Deficit) Total
----------- -----------
<S> <C> <C>
Balance at September 30, 1995 $(13,103,415) $(3,643,712)
Issuance of common stock at $3.00
per share in exchange for
repayment of Company's bank line
of credit 2,250,000
Receipt of subscription receivable 311,000
Issuance of common stock and warrants
at $3.75 per unit for cash 1,740,498
Proceeds from private placement 1,800,000
Deferred compensation related to grant
of stock options -
Amortization of deferred compensation 249,568
Net loss (2,378,298) (2,378,298)
----------- -----------
Balance at June 30, 1996 $(15,481,713) $ 329,056
============ ===========
</TABLE>
See accompanying notes to condensed consolidated financial statements
4
<PAGE> 6
MAXIM PHARMACEUTICALS, INC.
PART I - FINANCIAL INFORMATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the Nine Months
Ended June 30,
-----------------------------------
(Unaudited)
1996 1995
----------------- -----------------
<S> <C> <C>
Cash flows from operating activities:
Net loss $(2,378,298) $(1,923,870)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation and amortization 27,113 10,696
Loss on disposal of fixed assets 128,248 -
Write off receivable from related party 100,000 -
Deferred compensation 249,568 -
Changes in operating assets and liabilities:
Prepaid expenses and other current assets 12,376 562
Other assets and notes receivable from related parties 16,141 (45,887)
Accounts payable & other current liabilities (55,220) 162,214
----------------- -----------------
Net cash used in operating activities (1,900,072) (1,796,285)
----------------- -----------------
Cash flows from investing activities:
Capital expenditures (13,838) -
Additions to patents, licenses and proprietary technologies (145,227) (198,368)
----------------- -----------------
Net cash used in investing activities (159,065) (198,368)
----------------- -----------------
Cash flows from financing activities:
Proceeds from issuance of notes payable and long-term debt - 2,250,000
Payments on notes payable and long-term debt (2,141,293) -
Payments on notes payable and long-term debt to related
parties (106,000) (340,319)
Net proceeds from issuance of common stock and warrants 6,101,498 -
Costs incurred from initial public offering
completed July 1996 (394,703) -
----------------- -----------------
Net cash provided by financing activities 3,459,502 1,909,681
----------------- -----------------
Net increase (decrease) in cash 1,400,365 (84,972)
Cash and cash equivalents at beginning of period 512,928 118,655
----------------- -----------------
Cash and cash equivalents at end of period $ 1,913,293 $ 33,683
================= =================
</TABLE>
See accompanying notes to condensed consolidated financial statements
5
<PAGE> 7
MAXIM PHARMACEUTICALS, INC.
PART I - FINANCIAL INFORMATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments, consisting
of a normal recurring nature considered necessary for a fair presentation, have
been included. It is suggested that these consolidated financial statements be
read in conjunction with the financial statements and notes thereto included in
the Company's prospectus on form SB-2, effective July 9, 1996. The results of
the periods ended June 30, 1996 and 1995 are not necessarily indicative of the
operating results for the full year.
Certain amounts in prior period financial statements have been reclassified to
conform to the current period financial statements.
NOTE 2 - Principles of Consolidation
The consolidated financial statements include the accounts of the Company and
its wholly-owned subsidiary Syntello Vaccine Development (SVD). All significant
intercompany accounts and transactions have been eliminated.
NOTE 3 - Stock Options
In 1993, the Company established a stock option plan (1993 Plan) under which
incentive and nonqualified stock options have been granted to key employees,
directors and consultants of the Company. Under the 1993 Plan, options may be
granted to purchase up to 800,000 shares of common stock, and options that are
granted generally vest over five years with a maximum term of ten years. On May
2, 1996, the Company issued 526,665 options under the 1993 Plan that included
both incentive and nonqualified options at an exercise price of $3.75 per share
and a market price of $4.50 per share. In accordance with ABP No. 25, the
Company intends to take a charge to operations of $394,999 for the excess of the
fair market value over the exercise price on the date of grant over the vesting
period of the options. The charge to operations for the year-ended September 30,
1996 is estimated at approximately $275,000, of which $249,568 has been expensed
as of June 30, 1996.
NOTE 4 - Per Share Losses
Net losses per share are computed based upon the weighted average number of
shares outstanding of 3,490,773 and 288,577 for the three months ended June 30,
1996 and 1995, respectively and 3,023,002 and 288,577 for the nine months ended
June 30, 1996 and 1995, respectively. Common stock equivalents are excluded from
the computations of per share losses for the three and nine months ended June
30, 1996 and 1995 due to their non-dilutive effect.
6
<PAGE> 8
MAXIM PHARMACEUTICALS, INC.
PART I - FINANCIAL INFORMATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 5 - Subsequent Events
Sale of subsidiary - On July 5, 1996, the Company sold its ownership interest in
its Swedish subsidiary, Syntello Vaccine Development (SVD) to a former Swedish
collaborating scientist and former director and shareholder of the Company for
$1.00. On June 30, 1996, total remaining assets of SVD were approximately
$140,000, consisting primarily of capitalized patent costs and total liabilities
were approximately $2,500,000, of which $2,421,560 was a Swedish Industrial Fund
loan from the Swedish government. Total assets and liabilities at July 5, 1996
approximated total assets and liabilities on June 30, 1996. The Company expects
to record a gain of approximately $2,450,000 on the sale during July 1996. The
sale transferred certain technology rights related to certain peptides for use
in vaccination and induction of neutralizing antibodies against HIV. In
connection with the sale, the Company received a non-exclusive sublicense to the
CTB mucosal vaccine carrier for development of vaccines for the treatment of HIV
infection.
Initial Public Offering - The Company completed its initial public offering
effective during July 1996, in which it initially sold 2,500,000 shares of
common stock and 2,500,000 detachable warrants to purchase common stock. In
July 1996, the underwriters of the offering exercised an overallotment option
for an additional 375,000 shares of common stock and 375,000 detachable
warrants. The offering, including the overallotment exercise, netted proceeds
to the Company of approximately $18,500,000.
7
<PAGE> 9
MAXIM PHARMACEUTICALS, INC.
PART I - FINANCIAL INFORMATION
MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
This Report contains forward-looking statements that involve risks and
uncertainties. The Company's actual results could differ materially from those
anticipated in these forward-looking statements. Factors that may cause such
differences, include, but are not limited to, those discussed under "Risk
Factors" and elsewhere in the Company's Registration Statement filed on Form
SB-2 (No. 333-4854-LA), as amended, filed with the Securities and Exchange
Commission on July 9, 1996.
OVERVIEW
The Company devotes substantially all of its resources to its research and
development programs. The Company conducts the majority of its research and
development in university laboratories and at clinical sites through consulting
arrangements with its collaborative scientists. Oversight and coordination of
these programs is conducted by the Company's executive officers from its
administrative offices located in San Diego, California.
Maxim's products are in the development stage, and the Company does not expect
revenues in the near future. The Company expects to continue to incur losses as
it expands its research and development activities and sponsorship of clinical
trials. The Company expects that losses will fluctuate from quarter to quarter
and that such fluctuations may be substantial as a result, among other factors,
of the timing of FDA or foreign regulatory approvals, results of clinical
testing by the Company, and public announcements by the Company's competitors.
There can be no assurance that the Company will successfully develop,
commercialize, manufacture or market its products or ever achieve or sustain
product revenues or profitability. As of June 30, 1996, the Company had an
accumulated deficit of approximately $15.5 million and a working capital deficit
of $1.6 million.
RESULTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED JUNE 30, 1996 AND 1995
Research and Development Expenses. The Company's research and development
expenses consist primarily of payments to consultants engaged in preclinical
development of the Company's products and the expenses related to the Company's
sponsorship of clinical trials. The Company also funds research through certain
universities and institutions, including the University of Gothenburg in Sweden,
the University of California, San Diego and the National Institutes of Health.
Research and development expenses increased to approximately $342,000 from
$176,000 for the three months ended June 30, 1996 and 1995, respectively, a
94.3% increase. For the nine months ended June 30, 1996 and 1995, expenses
increased to approximately $1,078,000 from $792,000, a 36.2% increase. These
increases are due primarily to increased activity in the Company-sponsored
cancer clinical trials and increased funding of preclinical projects for mucosal
vaccine development.
8
<PAGE> 10
MAXIM PHARMACEUTICALS, INC.
PART I - FINANCIAL INFORMATION
MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED JUNE 30, 1996
AND 1995 (continued)
General and Administrative Expenses. The Company's general and administrative
expenses consist of salaries paid to the Company's executive officers,
professional fees paid to consultants and service providers, occupancy expenses,
travel expenses, and administrative support salaries. General and administrative
expenses increased to approximately $507,000 from $227,000 for the three months
ended June 30, 1996 and 1995, respectively, a 122.9% increase. For the nine
months ended June 30, 1996 and 1995, expenses increased to approximately
$1,027,000 from $684,000, a 50.2% increase. These increases were due primarily
to the amortization of deferred compensation on stock option grants.
Other expense (income). Other expense (income) consists primarily of interest
expense on the Company's indebtedness and foreign exchange losses. Interest
expense decreased to $24,000 from $131,000 for the three months ended June 30,
1996 and 1995, respectively. For the nine months ended June 30, 1996 and 1995,
interest expense decreased to $177,000 from $361,000, a 51.1% decrease. These
decreases are due primarily to the payoff of $2,250,000 on the Company's lines
of credit.
LIQUIDITY AND CAPITAL RESOURCES
The Company has financed its operations since its reorganization in 1993 as a
biopharmaceutical company primarily through private placements of its equity
securities, raising approximately $11,000,000 (net of offering costs).
Of this, approximately $1,900,000 remained at June 30, 1996. In anticipation of
future cash requirements, the Company completed an initial public offering (IPO)
in July 1996, generating net proceeds of approximately $18,500,000. Estimated
future cash requirements include funds necessary to conduct research and
development activities, preclinical studies, and clinical testing of the
Company's potential products, and to market any products that are developed.
Management believes these proceeds from the IPO combined with current cash on
hand will be sufficient to meet the Company's operating and capital requirements
for at least the next twelve months, although there can be no assurance this
amount of cash will be sufficient.
Cash used in operating activities increased to approximately $2,100,000 from
approximately $1,800,000 for the periods ended June 30, 1996 and 1995,
respectively. The increase in the use of cash is primarily due to a decrease in
accounts payable as of June 30, 1996. Cash flows from financing activities
increased to approximately $3,700,000 from approximately $1,900,000 for the
periods ended June 30, 1996 and 1995, respectively. The increase was due
primarily to proceeds of approximately $6,100,000 from the issuance of common
stock and warrants, partially offset by the payoff of the lines of credit of
$2,250,000 during the nine months ended June 30, 1996.
9
<PAGE> 11
MAXIM PHARMACEUTICALS, INC.
PART I - FINANCIAL INFORMATION
MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES (continued)
To extend an exclusivity agreement under a license related to the Company's
MaxVax technology, the Company is required to make a minimum payment of $400,000
by December 31, 1996. In addition, the Company has made various grants for
research which will require payments of approximately $100,000 in future
periods.
The Company expects its cash requirements to increase significantly in future
periods, and anticipates it will require substantial funds to conduct the
additional research and development activities, preclinical studies, and
clinical testing of its potential products, and to market any products that are
developed. The Company would also require a substantial amount of additional
capital if it decides to develop its own internal product research, development
and testing capabilities. Due to the timing issues involved, cash requirements
may materially differ from those currently anticipated. To successfully
commercialize any of the Company's products, management anticipates it will be
required to seek additional funds through public or private financings, or
collaborative arrangements with corporate partners, although there can be no
assurance any additional funds can be raised. The issuance of additional equity
securities could result in substantial dilution to the Company's stockholders,
however, if funds are not raised, it could have a material adverse effect on the
Company's operations and cash flows.
10
<PAGE> 12
MAXIM PHARMACEUTICALS, INC.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS BY THE COMPANY ON ITS SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
ANNUAL MEETING
The Annual Meeting of Stockholders of Maxim Pharmaceuticals, Inc. (the Annual
Meeting) was held on April 2, 1996 in San Diego, California. At the Annual
Meeting, the Company's stockholders approved the following proposals by the
tallies indicated below:
Proposal 1 - Election of directors to hold office until the next
Annual Meeting of Stockholders and until their successors are elected.
Each of the candidates listed below were duly elected to the Board of
Directors at the Annual Meeting by the tally indicated opposite their
names below:
Candidate Votes in Favor Votes Against
--------- -------------- -------------
Colin B. Bier 2,947,717 -0-
G. Steven Burrill 2,947,717 -0-
Per-Olof Martensson 2,947,717 -0-
Larry G. Stambaugh 2,947,717 -0-
F. Duwaine Townsen 2,947,717 -0-
Proposal 2 - To amend and restate the Company's Amended and Restated
Certificate of Incorporation.
Votes in Favor Votes Against Votes Abstained
-------------- ------------- ---------------
2,947,717 -0- -0-
Proposal 3 - To approve the Company's 1993 Long-Term Incentive Plan,
as amended.
Votes in Favor Votes Against Votes Abstained
-------------- ------------- ---------------
2,940,584 -0- 7,133
11
<PAGE> 13
MAXIM PHARMACEUTICALS, INC.
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS (continued)
ACTION BY WRITTEN CONSENT
By written consents dated May 31, 1996, the Company's stockholders approved the
following proposals by the tallies indicated below:
Proposal 1 - Approval of the Company's Restated Certificate of Incorporation,
to be filed in connection with the Company's proposed initial public offering.
Votes in Favor Votes Against Votes Abstained
-------------- ------------- ---------------
3,288,551 332 17,999
Proposal 2 - Approval of the Company's Bylaws, as amended and restated.
Votes in Favor Votes Against Votes Abstained
-------------- ------------- ---------------
3,288,684 332 17,866
Proposal 3 - Approval of a form of Indemnity Agreement between the Company and
its directors and executive officers and authorization to the Company to enter
into individual indemnity agreements with the directors and executive officers
of the Company.
Votes in Favor Votes Against Votes Abstained
-------------- ------------- ---------------
3,261,951 27,065 17,866
Proposal 4 - Ratification and approval of the issuance of stock
option grants pursuant to the Company's 1993 Long-Term Incentive
Plan to certain non-employee directors and a consultant to the
Company:
a. Option granted to F. Duwaine Townsen
Votes in Favor Votes Against Votes Abstained
-------------- ------------- ---------------
2,613,485 400 692,997
b. Option granted to Per-Olof Martensson
Votes in Favor Votes Against Votes Abstained
-------------- ------------- ---------------
3,261,751 400 44,731
c. Option granted to Colin Bier
Votes in Favor Votes Against Votes Abstained
-------------- ------------- ---------------
3,192,152 69,999 44,731
d. Option granted to Mark Bercuvitz
Votes in Favor Votes Against Votes Abstained
-------------- ------------- ---------------
2,342,951 69,999 893,932
12
<PAGE> 14
MAXIM PHARMACEUTICALS, INC.
PART II - OTHER INFORMATION
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
11.1 Statement Re: Computation of Net Loss per Share.
(b) No reports on Form 8-K were filed during the quarter ended June 30, 1996.
13
<PAGE> 15
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.
MAXIM PHARMACEUTICALS, INC.
/s: Larry G. Stambaugh Date: August 16, 1996
- - ------------------------------------------ -----------------------------
Larry G. Stambaugh
President and Chief Executive Officer.
(Principal Executive Officer and Principal
Financial and Accounting Officer)
14
<PAGE> 1
Exhibit 11.1
STATEMENT RE: COMPUTATION OF PER SHARE LOSSES
<TABLE>
<CAPTION>
For the Three For the Nine
Total # of Months Ended Months Ended
shares issued June 30, 1996 June 30, 1996
-------------- -------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C> <C>
Shares outstanding at September 30, 1996 2,082,821 2,082,821 2,082,821
Issuance of common stock 1,210,150 1,210,150 874,488
Issuance of common stock 400,000 197,802 65,693
--------- ---------- ----------
Weighted number of shares
outstanding at June 30, 1996 3,692,971 3,490,773 3,023,002
========= ========== ==========
Net loss for the period $ 885,410 $2,378,298
========== ==========
Net loss per share $ 0.25 $ 0.79
========== ==========
</TABLE>
15
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED) AND CONDENSED
CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED) AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH 10-Q FOR THE QUARTER ENDED JUNE 30, 1996
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-START> APR-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 1,913,293
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,914,593
<PP&E> 48,774
<DEPRECIATION> 25,005
<TOTAL-ASSETS> 4,124,156
<CURRENT-LIABILITIES> 3,548,100
<BONDS> 0
250
0
<COMMON> 3,693
<OTHER-SE> 325,113
<TOTAL-LIABILITY-AND-EQUITY> 329,056
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 848,485
<OTHER-EXPENSES> 36,925
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 24,042
<INCOME-PRETAX> (885,410)
<INCOME-TAX> 0
<INCOME-CONTINUING> (885,410)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (885,410)
<EPS-PRIMARY> (.25)
<EPS-DILUTED> (.25)
</TABLE>
