U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934
For the quarterly period ended SEPTEMBER 30, 1998.
[_] Transition report pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934
For the transition period from _____________ to _____________.
Commission file number 0-29624
SCNV ACQUISITION CORP.
(Exact Name of Small Business Issuer as Specified in its Charter)
Delaware 90-0194786
(State or other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
Omer Industrial Park, P.O. Box 3026, Omer, Israel 84965
(Address of Principal Executive Offices)
(011) 972-7-690-0950
(Issuer's Telephone Number including area code)
____________________________________________________
(Former Name, Former Address and Former Fiscal Year,
If Changed Since Last Report)
Check whether the issuer: (1) filed all reports required to be filed by section
13 or 15(d) of the Exchange Act during the past 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 [_]
As of November 14, 1998, there were 2,082,088 shares of the issuer's Common
Stock outstanding
Transitional Small Business Disclosure Format (check one):
Yes [_] No [X]
<PAGE>
SCNV ACQUISITION CORP. AND SUBSIDIARIES
QUARTER ENDED SEPTEMBER 30, 1998
FORM 10-QSB
INDEX
Page
----
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheet as of September 30, 1998
(Unaudited)........................................................1
Consolidated Statements of Operations For the Three
Months ended September 30, 1998 and September 30, 1997
(Unaudited)........................................................2
Consolidated Statement of Changes in Shareholders'
Equity For the Three Months ended September 30, 1998
(Unaudited)........................................................3
Consolidated Statement of Cash Flows For the Three
Months ended September 30, 1998 (Unaudited)........................4
Notes to Unaudited Consolidated Financial Statements...............5
Item 2. Management's Discussion and Analysis of Financial Condition
And Results of Operations ................................6
Part II. OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds.........................11
Item 6. Exhibits and Reports on Form 8-K..................................11
-ii-
<PAGE>
SCNV ACQUISITION CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(Unaudited)
<TABLE>
<CAPTION>
September 30, 1998
------------------
<S> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 3,081,048
Short-term investments 685,648
Trade receivables 6,565
Other receivables and prepaid expenses 81,516
-----------
Total current assets 3,854,777
-----------
FIXED ASSETS
Cost 273,828
Less - accumulated depreciation (132,568)
-----------
Total fixed assets 141,260
-----------
Total assets $ 3,996,037
===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Sundry payables and accrued expenses $ 210,333
-----------
Total current liabilities 210,333
-----------
LONG TERM LIABILITIES
Long term loan 200,000
Accrued severance pay 95,582
-----------
Total long term liabilities 295,582
-----------
Total liabilities 505,915
-----------
SHAREHOLDERS' EQUITY
Share capital
Preferred stock $.01 par value, 1,000,000 shares authorized; --
none issued and outstanding
Common stock $.01 par value, 10,000,000 shares authorized;
2,082,088 shares issued and outstanding 20,821
Additional paid-in-capital 7,558,663
Accumulated deficit (4,089,362)
-----------
Total shareholders' equity 3,490,122
-----------
Total liabilities and shareholders' equity $ 3,996,037
===========
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
1
<PAGE>
SCNV ACQUISITION CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the three months ended
September 30,
1998 1997
----------- -----------
(pro forma)
REVENUES
Sales $ 189 $ 3,327
Contract services 684 4,016
----------- -----------
Total revenues 873 7,343
----------- -----------
COSTS AND EXPENSES
Research and development costs 145,205 67,178
Cost of merchandise purchased 168 2,613
Marketing expenses 67,673 7,964
General and administrative expenses 127,743 84,581
----------- -----------
Total costs and expenses 340,789 162,336
----------- -----------
Loss before one-time charge (339,916) (154,993)
One-time charge of acquired research and
development in process (3,772,054) --
----------- -----------
Operating Loss (4,111,970) (154,993)
FINANCING INCOME, NET 22,608 2,974
----------- -----------
Net loss $(4,089,362) $ (152,019)
=========== ===========
Net loss per common share $ (1.96) $ (0.15)
=========== ===========
Weighted average number of common shares
outstanding 2,082,088 1,041,044
=========== ===========
The accompanying notes are an integral part of these
consolidated financial statements.
2
<PAGE>
SCNV ACQUISITION CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES
IN SHAREHOLDERS' EQUITY
(Unaudited)
<TABLE>
<CAPTION>
Number of Share Additional Accumulated
Shares Capital Paid-In-Capital Deficit Total
----------- ----------- --------------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Balance as of July 1, 1998 541,343 $ 5,413 $ 2,179 -- $ 7,592
Shares issued in connection with
the initial public offering 1,041,044 10,411 4,688,201 -- 4,698,612
Shares issued to Bayou in
connection with the acquisition
of subsidiary 499,701 4,997 2,868,283 -- 2,873,280
Net Loss -- -- -- (4,089,362) (4,089,362)
----------- ----------- ----------- ----------- -----------
Balance as of September 30, 1998 2,082,088 $ 20,821 $ 7,558,663 $ 4,089,362 $ 3,490,122
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
3
<PAGE>
SCNV ACQUISITION CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
For the three
months ended
September 30
1998
-----------
CASH FLOW FROM OPERATING ACTIVITIES
Net loss $(4,089,362)
Adjustments to reconcile net loss to net cash used
in operating activities 3,985,443
-----------
Net cash used in operating activities (103,919)
-----------
CASH FLOW FROM INVESTING ACTIVITIES
Acquisition of subsidiary, net of cash required (49,699)
Investment in equipment (40,874)
Short-term investments (685,648)
Proceeds from sale of fixed assets 5,708
-----------
Net cash used in investing activities (770,513)
-----------
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from initial public offering 4,698,612
Short term borrowings, net (743,132)
-----------
Net cash provided by financing activities 3,955,480
-----------
INCREASE IN CASH AND CASH EQUIVALENTS 3,081,048
CASH AND CASH EQUIVALENTS AT BEGINNING
OF THE PERIOD --
-----------
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD $ 3,081,048
===========
ADJUSTMENTS TO RECONCILE NET LOSS TO NET CASH USED
IN OPERATING ACTIVITIES
Items not involving cash flows:
Depreciation $ 8,108
Severance pay 74,140
Loss on sale of equipment 836
Acquired research and development in process 3,772,054
Changes in operating assets and liabilities:
Decrease in receivables and prepaid expenses 625,115
Decrease in sundry payables and accrued expenses (494,810)
-----------
$ 3,985,443
===========
NON-CASH INVESTING AND FINANCING ACTIVITIES
Shares issued as consideration for acquisition
of subsidiary $ 2,873,280
===========
The accompanying notes are an integral part of these
consolidated financial statements.
4
<PAGE>
SCNV ACQUISITION CORP. AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
General
The financial statements as of and for the three months ended September 30, 1998
are unaudited; however in the opinion of management all adjustments (consisting
solely of normal recurring adjustments) necessary for a fair presentation of the
financial statements for the interim period have been made. The financial
statements have been prepared in a manner consistent with the 10-KSB filed for
the fiscal year ended June 30, 1998 and should be read in connection with those
financial statements. The comparative pro forma financial information for the
three months ended September 30, 1997 pertain to the pro forma results of
operations of SCNV Acquisition Corp. (the "Company") and Solmecs Corporation
N.V. and its wholly-owned subsidiary Solmecs (Israel) Ltd. ("Solmecs") as if the
combination described below had been effective as of July 1, 1997. The unaudited
pro forma consolidated statement of operations is not necessarily indicative of
what the actual results of operations of the Company would have been assuming
the combination had been completed as of July 1, 1997, nor is it necessarily
indicative of the results of operations for future periods.
Initial Public Offering
The Company was organized under the laws of the State of Delaware on May 19,
1997 to acquire Solmecs and select, develop and commercially exploit proprietary
technologies, in various stages of development, invented primarily by scientists
who have recently immigrated to Israel from, and by scientists and institutions
in, Russia and other countries that formerly comprised the Soviet Union. On July
8, 1998 the Company consummated an Initial Public Offering (the "Public
Offering") in which 1,041,044 Units, comprised of 1,041,044 shares of Common
Stock and 1,041,044 redeemable Common Stock purchase warrants ("Warrants") were
sold to the public at $5.75 per Unit. Each Warrant entitles the holder to
purchase one share of Common Stock at a price of $7.50, subject to adjustment in
certain circumstances, at any time during the four-year period commencing June
29, 1999. The net proceeds from the Public Offering were approximately
$4,700,000.
Acquisition of Solmecs
Simultaneously with the consummation of the Public Offering the Company acquired
all of the issued and outstanding capital stock of Solmecs (the "Acquisition")
in consideration for 499,701 shares of the Company's common stock issued to
Bayou International Ltd. ("Bayou"), the parent of Solmecs. The Acquisition has
been accounted for as a purchase. The excess of purchase price over fair value
of assets acquired of $3,772,054 has been reflected as acquired research and
development in process and fully expensed at the date of the Acquisition.
5
<PAGE>
Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Safe Harbor Statement Under The Private Securities Litigation Reform Act of
1995:
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor"
for forward-looking statements. Certain information included in this Report
contains statements that are forward-looking, such as statements relating to
plans for future activities. Such forward-looking information involves known and
unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be materially different
from any future results, performance or achievements expressed or implied by
such forward-looking statements made by or on the behalf of the Company. These
risks, uncertainties and factors include, but are not limited to, those relating
to the Company's growth strategy, the ability to hire and retain key personnel,
uncertainty of feasibility of the Company's technologies, the acquisition of
Solmecs Corporation N.V. and its subsidiary, relationships with and dependence
on third-party equipment manufacturers and suppliers, uncertainties relating to
business and economic conditions in markets in which the Company operates,
uncertainties relating to government and regulatory policies and other political
risks, expansion and other activities of competitors, protection of patents and
other proprietary rights and the general condition of the economy and its effect
on the securities markets. The words "believe", "expect", "anticipate", "intend"
and "plan" and similar expressions identify forward-looking statements. Readers
are cautioned not to place undue reliance on these forward-looking statements,
which speak only as of the date the statement was made.
General
The Company was organized to select, develop and commercially exploit
proprietary technologies, in various stages of development, invented primarily
by scientists who have recently immigrated to Israel from, and by scientists and
institutions in, Russia and other countries that formerly comprised the Soviet
Union. In furtherance of this goal, the Company acquired Solmecs, a Netherlands
Antilles company, the operations of which are located in Israel, which owns
certain technologies developed by such scientists in the past and actively seeks
to identify such technologies for exploitation. The technologies of Solmecs and
technologies identified by Solmecs for exploitation are in various stages of
development and include technologies that have begun to be commercialized as
well as technologies that the Company believes are ready for commercialization
in the near future. The Company itself was organized in May 1997 and, since its
inception, the Company has been engaged principally in organizational
activities, including developing a business plan, matters related to the Public
Offering and negotiating an agreement relating to the Acquisition.
The Company expects to manufacture and market certain technologies which have
been identified by Solmecs and shown to be commercially viable, such as hot
water tank display control systems, photo-voltaic cells and plasma chemically
treated extra smooth rubber gaskets. The Company further intends to offer its
engineering services to industry and research institutions in the fields of
LMMHD power technology and liquid metal engineering. To date, Solmecs has not
generated significant revenues and the Company does not expect to generate any
meaningful revenues for the foreseeable future and until such time, if ever, as
it successfully commercializes one or more of Solmecs' existing or future
technologies or sells proprietary rights relating to one or more of Solmecs'
existing or future technologies. Although the LMMHD power technology has been in
development since the late 1970's, it has not yet reached commercialization. In
order to achieve commercialization of such technology, the Company will be
required to build a commercial scale demonstration plant, which will require a
significant capital expenditure. The Company intends to commence building such a
plant within the next few years, provided that it will be able to obtain the
necessary funds for such project. The Company has incurred significant losses
since its inception, resulting in an accumulated deficit of $4,089,362 at
September 30, 1998. The rate of loss is expected to continue for the foreseeable
future and until such time, if ever, as the Company is able to achieve
sufficient levels of revenue from the commercial exploitation of its
technologies to support its operations.
The Company intends to implement a four-step process with respect to the
development of proprietary technologies which it has identified for
exploitation. Initially the Company,
6
<PAGE>
through its scientific, engineering and administrative personnel, will seek to
identify and analyze a number of proposed advanced technologies with potential
commercial viability. The Company will then assess the costs of further research
and development (including the building and testing of prototypes, if
indicated), seek to obtain intellectual property rights in viable technologies,
develop a business plan detailing the exploitation of such technologies from the
research and development phase through product commercialization, develop and,
in some instances, implement financing strategies to further such business plan,
and suggest and, in some cases, assemble a team of scientists and engineers most
suitable for implementation of such business plan. Upon completion of the
business development plan for each project, the Company may seek to manufacture
and market the project itself, enter into strategic alliances for such
commercialization, or sell or license the proprietary information and know-how
to third parties in consideration of technology transfer or license fees.
Completion of the research, development and commercialization of the Company's
technologies or any potential application of such technologies will require
significant additional effort, resources and time, including funding
substantially greater than is currently available to the Company. Such research
and development efforts remain subject to all of the risks associated with the
development of new products based on emerging and innovative technologies,
including, without limitation, unanticipated technical or other problems and the
possible insufficiency of the funds allocated to complete such development,
which could result in delay of research or development or substantial change or
abandonment of research and development activities.
Results of Operations
The consolidated statement of operations and other financial and operating data
for the three month period ended September 30, 1998 are derived from the
unaudited financial statements of the Company included elsewhere herein. The
unaudited pro forma consolidated statement of operations for the three month
period ended September 30, 1997 represents the adjustments made to present the
combined financial position of the Company and Solmecs as if the Acquisition had
been effective as of July 1, 1997. Such pro forma information gives effect to
the payment of $30,000 to officers in connection with employment agreements.
Three Months Ended September 30, 1998 Compared with Pro Forma Three Months
Ended September 30, 1997
Total Revenues. Total revenues decreased by $6,470 or 88% to $873 for the three
months ended September 30, 1998 compared to $7,343 for the three months ended
September 30, 1997. The decrease is attributable to the decrease in sales of
photovoltaic cells and panels.
Research and Development Costs. Research and development costs increased by
$78,027 or 116% to $145,205 for the three months ended September 30, 1998,
compared to $67,178 for the three months ended September 30, 1997. The increase
is primarily due to (i) the
7
<PAGE>
increase in salaries due to the employment of additional scientific personnel,
(ii) the hiring of additional consultants for new projects feasibility testing,
and (iii) the increase in rent fees associated with the leasing of new
facilities in Omer Industrial Park.
Costs of Merchandise Purchased. Due to the decrease of sales of photovoltaic
cells and panels, costs of merchandise purchased decreased by $2,445 or 94%, to
$168 for the three months ended September 30, 1998, from $2,613 for the three
months ended September 30, 1997.
Marketing, General and Administrative Expenses. Marketing, general and
administrative expenses increased by $102,871 or 111% to $195,416 for the three
months ended September 30, 1998, as compared to $92,545 for the three months
ended September 30, 1997. This increase is primarily attributable to (i) foreign
travel related to the marketing and implementation of the new technologies, (ii)
salaries and related expenses resulting from the hiring of additional personnel
for marketing positions, (iii) professional fees associated with services
rendered to the Company and Solmecs, and (iv) fees associated with the leasing
of new facilities in Omer Industrial Park.
One-Time Charge of Acquired Research and Development In-Process. The acquisition
of Solmecs by the Company has been accounted for as a purchase and the excess
purchase price over fair value of assets acquired of $3,772,054 has been
reflected in the Company's statement of operations as acquired research and
development in process. The Company has recorded a one-time charge for the
write-off in full of such research and development in process as of the date of
the Acquisition.
Operating Loss After One-Time Charge. Primarily due to the one-time charge of
$3,772,054 reflecting the write-off of acquired research and development in
process, operating Loss increased to $4,111,970 for the three months ended
September 30, 1998, from $154,993 for the three months ended September 30, 1997.
The increase is also attributable to an increase in expenses as set forth above
as well as a decrease in sales of photovoltaic cells and panels.
Financing Income, Net. Financing income was $22,608 for the three months ended
September 30, 1998, as compared to financing income of $2,974 for the three
months ended September 30, 1997. The increase is attributable to interest earned
on deposits.
Net Loss. As a result of the foregoing, net loss increased to $4,089,362 for the
three months ended September 30, 1998 from $152,019 for the three months ended
September 30, 1997.
8
<PAGE>
Liquidity and Capital Resources
As of September 30, 1998, the Company had working capital of $3,644,444, a
shareholders' equity of $3,490,122 and an accumulated deficit of $4,089,362. The
improvement in shareholders' equity and working capital was due to proceeds
received by the Company upon the consummation of the Public Offering on July 8,
1998.
During the period from inception through June 30, 1998, Batei Sefer Limlacha, a
principal stockholder of the Company, loaned to the Company $110,108 for working
capital purposes. During the period from September 1997 through June 30, 1998,
Batei Sefer Limlacha loaned to Solmecs $375,000 for working capital purposes.
The loans from Batei Sefer Limlacha were repaid in full by the Company on July
8, 1998.
In April 1998, Solmecs (Israel) Ltd. obtained a line of credit facility of
approximately $270,000 from an Israeli bank allowing for overdraft for working
capital purposes. The line of credit facility was secured by a fixed charge on
Solmecs (Israel) Ltd.'s uncalled share capital and goodwill and a floating
charge on all of its present and future acquired property and rights. The
Company repaid the line of credit facility in full on July 9, 1998 resulting in
the cancellation of the fixed and floating charges securing such obligation.
In April 1998, Solmecs obtained a loan of $60,000 from an unrelated third party.
The loan did not bear interest and was repaid on the consummation of the Public
Offering.
On July 8, 1998 the Company consummated the Public Offering of 1,041,044 Units
consisting of Common Stock and Warrants for net proceeds to the Company of
approximately $4,700,000 after expenses of the offering.
The Company's capital requirements will be significant. The Company is dependent
upon the proceeds of the Public Offering to finance the operations of the
Company, including the costs of market research and marketing activities,
continued research and development efforts, establishing manufacturing
capabilities and the acquisition of intellectual property rights. The Company
anticipates, based on management's internal forecasts and assumptions relating
to its operations (including assumptions regarding the timing and progress of
the Company's technologies), that the net proceeds of the Public Offering will
be sufficient to satisfy the Company's contemplated cash requirements for at
least 12 months following the consummation of the Public Offering. In the event
that the Company's plans change, its assumptions change or prove inaccurate, or
if the proceeds of the Public Offering prove to be insufficient to fund
operations, the Company could be required to seek additional financing. Based on
the results of preliminary assessment activity to be performed on several
potential projects identified or to be identified by the Company, the Company
intends to engage in research and development of two such projects in the first
year and four projects in the second year (which may include an additional years
work on all or both of the projects from the first year) and believes that a
number of such projects will enter the commercialization stage during such
two-year period. Completion of the research, development and commercialization
of the Company's technologies or any potential
9
<PAGE>
application of such technologies will require significant additional effort,
resources and time including funding substantially greater than the proceeds of
the Public Offering and otherwise currently available to the Company. Moreover,
the proceeds received in the Public Offering may be insufficient to satisfy the
scheduled projects, requiring the Company to seek additional financing. The
Company has no current arrangements with respect to, or sources of, additional
financing, and it is not anticipated that existing shareholders will provide any
portion of the Company's future financing requirements. There can be no
assurance that additional financing will be available to the Company when
needed, on commercially reasonable terms, or at all.
Inflation
In the 1990's the economy of Israel experienced significant expansion. During
calendar years 1992 through 1997, Israel's gross domestic product ("GDP")
increased by 6.2%, 6.7%, 3.4%, 6.5%, 6.8% and 2.1% (estimated), respectively.
The Israeli Government's monetary policy contributed to relative price and
exchange rate stability during most of these years despite fluctuating rates of
economic growth and a high rate of unemployment. The inflation rate for 1994,
1995, 1996 and 1997 was 14.5%, 8.1%, 10.6% and 7.0%, respectively. Although
during 1997 the rate of devaluation of the NIS against the dollar exceeded the
rate of inflation in Israel, for the several years preceding 1997 the rate of
inflation in Israel exceeded the rate of devaluation of the NIS against the
dollar.
Israel's economy has been subject to numerous destabilizing factors, including a
period of rampant inflation in the early to mid-1980's, low foreign exchange
reserves, fluctuations in world commodity prices, military conflicts and civil
unrest. In response to these problems, the Israeli Government has intervened in
various sectors of the economy, employing, among other means, fiscal and
monetary policies, import duties, foreign currency restrictions and controls of
wages, prices and foreign currency exchange rates. The Israeli Government
frequently has changed its policies in all these areas.
10
<PAGE>
PART II - OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds
(d) On July 8, 1998 the Company consummated its initial public offering
(the "Public Offering") contemplated by its Registration Statement on
Form SB-2 (file no. 333- 43955) which was declared effective by the
Securities and Exchange Commission on June 29, 1998. A total of
1,197,200 Units were registered for sale by the Company to the public
and 1,041,444 Units were sold to the public for gross proceeds of
$5,986,003. Each Unit consisted of one share of common stock, $.01 par
value per share, of the Company (the "Common Stock") and one Class A
redeemable Common Stock purchase warrant (the "Warrants"). The Common
Stock and Warrants included in the Units were registered in the Public
Offering and became detachable and separately transferrable from the
Units on September 29, 1998. In addition, 1,041,044 shares of Common
Stock issuable upon exercise of the Warrants were registered. The
Warrants are exercisable between June 29, 1999 and June 28, 2003. In
addition, 104,104 Units were registered pursuant to an option granted
to the Underwriter of the Public Offering.
Net proceeds from the Offering were approximately $4,700,000. July 8,
1998 (the closing date of the Offering) the Company applied
approximately $391,000 of net proceeds toward the repayment of
indebtedness of Solmecs to a stockholder of the Company. The Company
also repaid approximately $110,000 owed to such stockholder for monies
advanced for pre-offering expenses. As of September 30, 1998 the
Company has applied the balance of net proceeds from the Offering as
follows: (i) approximately $70,000 to market research and marketing
activities; (ii) approximately $150,000 to research and development;
(iii) approximately $182,000 to repayment of an existing credit line
facility, approximately $90,000 of which was incurred after March 31,
1998, and which allows for future borrowing by the Company; and (v)
approximately $130,000 to working capital and general corporate
purposes.
On July 8, 1998, contemporaneous with the consummation of the Public
Offering, the Company acquired, in a tax free stock-for-stock
transaction, all of the issued and outstanding capital stock of Solmecs
Corporation N.V., a Netherlands Antilles company and its wholly-owned
subsidiary Solmecs (Israel) Ltd. from Bayou International Ltd.
("Bayou") and issued to Bayou 499,701 shares of unregistered Common
Stock of the Company.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 27 - Financial Data Schedule
11
<PAGE>
(b) Reports on Form 8-K
No reports on Form 8-K were filed by the Company during the
three month period ended September 30, 1998.
12
<PAGE>
SCNV ACQUISITION CORP. AND SUBSIDIARIES
SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized on the 17th day of November 1998.
SCNV ACQUISITION CORP.
(Registrant)
/s/ Herman Branover
-------------------------------------
Professor Herman Branover
President and Chief Executive Officer
/s/ Jacline Bavli
-------------------------------------
Jacline Bavli
Chief Financial Officer
13
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S FINANCIAL STATEMENTS IN THIS QUARTERLY REPORT ON FORM 10-QSB AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-END> SEP-30-1998
<CASH> 3,081,048
<SECURITIES> 0
<RECEIVABLES> 81,516
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,854,777
<PP&E> 273,828
<DEPRECIATION> (132,568)
<TOTAL-ASSETS> 3,996,037
<CURRENT-LIABILITIES> 210,333
<BONDS> 0
0
0
<COMMON> 20,821
<OTHER-SE> 3,490,122
<TOTAL-LIABILITY-AND-EQUITY> 3,996,037
<SALES> 189
<TOTAL-REVENUES> 873
<CGS> 168
<TOTAL-COSTS> 340,789
<OTHER-EXPENSES> 3,772,054
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (4,089,362)
<EPS-PRIMARY> (1.96)
<EPS-DILUTED> (1.96)
</TABLE>