<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported)
November 3, 1999
YOUBET.COM, INC.
(Exact Name of Registrant as specified in Charter)
Delaware 33-13789LA 95-4627253
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification Number)
1950 Sawtelle Boulevard, Suite 180, Los Angeles, California 90025
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(Address of principal executive offices) (Zip Code)
(310) 444-3300
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(Registrant's telephone number, including area code)
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS
A. A copy of a press release issued by Youbet.com, Inc. on November 2, 1999 is
attached hereto as EXHIBIT 99.1 and incorporated herein by reference.
ITEM 7. EXHIBITS
Exhibit Number Description of Document
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99.1 Press release dated November 2, 1999
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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 hereunto duly authorized.
Date: November 3, 1999 YOUBET.COM, INC.,
(Registrant)
By: /s/ Phillip C. Hermann
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Phillip C. Hermann
Chief Financial Officer
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EXHIBIT 99.2
TUESDAY, NOVEMBER 2, 1999 AM EASTERN TIME
COMPANY PRESS RELEASE
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[LOGO]
APPROVED BY: Phillip Hermann, Executive Vice President and
Chief Financial Officer (310) 444-3300
CONTACT: INVESTOR RELATIONS
Morgen Walke Associates
Erica Mannion, John Swenson (415) 296-7383
MEDIA RELATIONS
Brener Zwikel & Associates
Steve Brener (x110), Jordan Miller (x103) (818) 344-6195
FOR IMMEDIATE RELEASE
YOUBET.COM REPORTS STRONG SUBSCRIBER AND REVENUE GROWTH
(LOS ANGELES, November 2, 1999) -- Youbet.com, Inc. (Nasdaq:UBET), the leading
global online live-event wagering company, today reported revenue of $1.1
million for its third quarter ended September 30, 1999, up from $76,000 for the
third quarter a year ago. Revenue for the quarter increased 54% on a sequential
basis from the $733,000 recorded in the second quarter. Net loss for the quarter
was $7.2 million or $0.38 per diluted share, as compared to a net loss of $3.1
million or $0.28 per diluted share for the comparable quarter in 1998. This
compares to a net loss of $4.3 million or $0.28 per diluted share recorded in
the second quarter of 1999. Youbet exceeded analyst expectations for revenue as
well as reported lower than expected net loss for the quarter.
As previously reported, the number of subscribers to the You Bet
Network doubled over the prior sequential quarter, totaling 11,500 on
September 30, 1999, up from 5,700 on June 30, 1999. Youbet attributes its
subscriber growth primarily to its marketing campaign. Television spots began
airing in October 1999 in four major markets after a delay due to lengthy
approval cycles at target stations and networks.
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Youbet continues to expand its list of premiere partnership tracks and
during the third quarter signed an agreement with Northfield Park. During the
quarter, Youbet also signed an agreement with Axcis Information Networks, a
provider of harness racing handicapping information. The Company has initially
focused on the expansion of its domestic subscriber base in order to access the
estimated $15 billion U.S. horse track wagering market. In addition, the Company
is working to expand the Youbet.com brand, product and services in the overseas
market, which Youbet estimates at more than $85 billion for horse race wagering
and in excess of $500 billion for other forms of live event wagering.
Robert M. Fell, Youbet.com Chief Executive Officer, said, "Obviously
the Company has experienced unexpected challenges in recent weeks due to the
investigation by Los Angeles County District Attorney and the Los Angeles
Police Department, which we disclosed two weeks ago. Youbet and our counsel
are in discussions with those involved in an effort to resolve the situation
as quickly as possible. Specific to our achievements in this quarter, we are
very excited about the value added partnerships we established, and the
substantial amount of time and energy we put into marketing and branding and
are pleased with the results." Fell continued, "Our National radio campaign
consisting of three different spots airing in all major markets as well as
our CD ROM distribution via mass mailing and recently released national
television commercials, have all contributed greatly to identifying
Youbet.com as the leading global online live event wagering company."
Youbet.com is focused on using the power and inter-activity of the
Internet to allow participation and wagering on live online events worldwide.
The Company currently provides members the ability to watch and wager on a wide
selection of coast-to-coast thoroughbred and harness horse racing, via its
exclusive private closed-loop network. Youbet.com does not actually accept or
place any wagers. Wagers are accepted and placed only by a state licensed
wagering entity, currently the Ladbroke Pennsylvania facility. Youbet.com's role
in the wagering process is limited to transmitting information related to the
wagers to the licensed wagering facility. Members have 24-hour access to the
network's features, including live racing from a choice of more than 30
racetracks across the country, commingled track pools, live audio/video,
up-to-the-minute track information, real-time wagering information, and
value-added handicapping products. In December 1998, Youbet.com accepted the
1998 Innovator of the Year Honors by Internet Gaming International. For further
information, visit www.youbet.com. To subscribe to the You Bet Network call
1-888-YOUBET-8 or visit the Web site at youbet.com.
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Forward-Looking Statements: This release contains forward-looking statements,
which are made pursuant to the safe-harbor provisions of the Private Securities
Litigation Reform Act of 1995. Expressions of future goals and similar
expressions reflecting something other than historical fact are intended to
identify forward-looking statements, but are not the exclusive means of
identifying such statements. These forward-looking statements involve a number
of risks and uncertainties, including the timely development and market
acceptance of products and technologies, successful integration of acquisitions,
the ability to secure additional sources of financing, the ability to reduce
operating expense and other factors described in the Company's filing with the
Securities and Exchange Commission. The actual results that the Company achieves
may differ materially from any forward-looking statements due to such risks and
uncertainties. The Company undertakes no obligations to revise or update any
forward-looking statements in order to reflect events or circumstances that may
arise after the date of this release. You Bet is a registered trademark of
Youbet.com, Inc. All other brands and products referenced herein are the
trademarks or registered trademarks of their respective holders.
(Tables to follow)
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YOUBET.COM, INC.
STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
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1998 1999 1998 1999
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<S> <C> <C> <C> <C>
Revenues $ 76,382 $ 1,132,054 $ 98,407 $ 2,325,922
Operating expenses:
Network operations 404,798 492,083 736,401 1,390,700
Research and development 348,667 533,321 927,202 1,492,397
Sales and marketing 499,587 5,429,485 1,190,751 6,896,485
General and administrative 818,612 1,204,577 2,044,488 2,778,872
Depreciation and amortization 86,192 114,240 244,325 315,273
Non-cash compensation 707,283 457,895 3,452,572 1,951,286
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Total operating expenses 2,865,139 8,231,601 8,595,739 14,825,013
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Loss from operations (2,788,757) (7,099,547) (8,497,332) (12,499,091)
Other income (expense):
Interest expense (79,116) (1,014,213) (322,717) (2,038,201)
Amortization of deferred financing costs (64,242) (95,008) (111,698) (191,965)
Discount on conversion of bridge loans, accounts
payable and deferred salaries into common stock -- -- (841,713) --
Fair value of warrants issued for financing costs (161,962) (12,570) (1,405,684) (478,221)
Interest income 48,608 969,095 49,380 1,488,699
Other (9,557) 8,197 (120,219) 7,197
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Total other income (expense) (266,269) (144,499) (2,752,651) (1,212,491)
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Net loss $ (3,055,026) $ (7,244,046) $ (11,249,983) $ (13,711,582)
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Net loss per share - basic and diluted $ (0.28) $ (0.38) $ (1.10) $ (0.85)
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Weighted average number of shares 11,104,273 19,121,288 10,196,812 16,151,722
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</TABLE>
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