<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB/A
-------------
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended October 31, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission File No. 1-25362
INFOSAFE SYSTEMS, INC.
-----------------------------------------------------------------
(Exact Name of Small Business Issuer as Specified in Its Charter)
Delaware 13-3645702
------------------------------ ----------------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification Number)
342 Madison Avenue
Suite 622
New York, NY 10173
----------------------------------------
(Address of Principal Executive Offices)
(212) 867-7200
------------------------------------------------
(Issuer's Telephone Number, Including Area Code)
Not Applicable
----------------------------------------------------
(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 Securities Exchange Act of 1934 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 _____
State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date.
Class Outstanding at December 12, 1996:
----- ---------------------------------
Class A Common Stock, $.01 par value 2,940,309 shares
Class B Common Stock, $.01 par value 1,309,549 shares
Traditional Small Business Disclosure Format
Yes __X__ No _____
<PAGE>
INFOSAFE SYSTEMS, INC.
(a development stage company)
INDEX TO FORM 10-QSB
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets as of July 31, 1996
and October 31, 1996 (unaudited).............................................................. 3
Condensed Statements of Operations for the Three Months ended October 31, 1995
and October 31, 1996
(unaudited) and for the period November 18, 1991
(inception) to October 31, 1996 (unaudited).................................................. 4
Condensed Statements of Cash Flows for the Three Months ended October 31, 1995
and October 31, 1996 (unaudited) and for the period November 18, 1991
(inception) to
October 31, 1996 (unaudited).................................................................. 5
Notes to Condensed Financial Statements............................................................ 6
Item 2. Management's Discussion and Analysis
of Financial Condition and Results
of Operations........................................................................... 9
PART II. OTHER INFORMATION
Item 1. Legal Proceedings......................................................................... 12
Item 5. Other Information......................................................................... 13
Item 6. Exhibits and Reports on Form 8-K.......................................................... 13
SIGNATURES......................................................................................... 14
</TABLE>
-2-
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1: Financial Statements
INFOSAFE SYSTEMS, INC.
(a development stage company)
CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
July 31, October 31,
A S S E T S 1996 1996
----------- ------------- --------------
(Unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents................................................... $ 50,466 $ 85,302
Marketable securities - available for sale.................................. 908,178 552,838
Other current assets........................................................ 132,609 114,839
------------ -------------
Total current assets.................................................... 1,091,253 752,979
Equipment held for lease (Note C)................................................ 420,613 379,283
Non current assets............................................................... 513,466 477,325
------------ ------------
T O T A L............................................................... $ 2,025,332 $1,609,587
============ ============
L I A B I L I T I E S
---------------------
Current liabilities:
Accounts payable and accrued expenses....................................... $ 375,481 $ 361,779
Due to stockholders and employees........................................... 116,163 185,202
------------ ------------
Total current liabilities............................................... 491,644 546,981
Non current liabilities.......................................................... 10,364 7,874
------------ ------------
Total liabilities....................................................... 502,008 554,855
------------ ------------
Commitments and contingencies (Note D)
STOCKHOLDERS' EQUITY
--------------------
Common Stock:
Class A - par value $.01 per share, 20,000,000 shares authorized, one vote
per share; 2,908,549 and 2,940,309 (unaudited) shares issued and
outstanding, respectively............................................... 29,085 29,403
Class B - par value $.01 per share, 2,000,000 shares
authorized, six votes per share; 1,326,309 and 1,309,549
(unaudited)shares issued and outstanding, respectively,
including 781,244 shares held in escrow................................ 1,387 1,369
Class E-1 - par value $.01 per share, 2,000,000 shares
authorized, one vote per share; 1,343,637 shares
issued and to be issued, redemption value $.0001 per share............. 13,436 13,436
Class E-2 - par value $.01 per share, 2,000,000 shares
authorized, one vote per share; 1,343,637 shares
issued and to be issued, redemption value $.0001 per share.............. 13,436 13,436
Additional paid-in capital....................................................... 9,694,582 9,754,282
(Deficit) accumulated during the development stage............................... (8,234,154) (8,758,354)
Unrealized gain on marketable securities......................................... 5,552 1,160
------------ ------------
Total stockholders' equity.............................................. 1,523,324 1,054,732
------------ ------------
T O T A L.......................................................... $ 2,025,332 $ 1,609,587
============ ===========
</TABLE>
The accompanying notes are an integral part of these condensed
financial statements.
-3-
<PAGE>
INFOSAFE SYSTEMS, INC.
(a development stage company)
CONDENSED STATEMENT OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
For the
Three Months Ended Period from
October 31, November 18, 1991
-------------------- (Inception) to
1995 1996 October 31, 1996
---- ---- ----------------
<S> <C> <C> <C>
Revenues ............................................ $ 19,890 $ 11,678 $ 603,518
-------- -------- ----------
Expenses:
Cost of revenues................................. 23,377 14,641 206,406
Write down of assets (Note C).................... 30,000 500,000
Operating expenses............................... 727,973 505,590 8,268,220
------- -------- -----------
T o t a l........................................ 751,350 550,231 8,974,626
--------- --------- -----------
Operating (loss)...................................... (731,460) (538,553) (8,371,108)
Investment income..................................... 75,995 14,857 410,032
Settlement expense ................................... (394,828)
Interest expense (including debt
discount and deferred financing fees)............ (9,082) (504) (394,050)
---------- ------------ -----------
Net (loss) ........................................ $(664,547) $(524,200) $(8,749,954)
======== ======== ==========
Net (loss) per common shares.......................... $(.21) $(.15)
==== ====
Weighted average number of common
shares and common share equivalents
outstanding...................................... 3,134,656 3,468,614
========= =========
</TABLE>
The accompanying notes are an integral part of these condensed
financial statements.
-4-
<PAGE>
INFOSAFE SYSTEMS, INC.
(a development stage company)
CONDENSED STATEMENT OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
For the
Three Months Ended Period from
October 31, November 18, 1991
------------------- (Inception) to
1995 1996 October 31, 1996
---- ---- ----------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net (loss).......................................................... $(664,547) $(524,200) $(8,749,954)
Write off equipment held for lease.............................. 30,000 500,000
Other net cash provided by (used in) ...........................
Operating activities ....................................... (59,878) 124,676 1,344,469
--------- ------- ---------
Net cash (used in) operating activities.................... (724,425) (369,524) (6,905,485)
-------- -------- ----------
Cash flows from investing activities:
Purchase of marketable securities................................... (224,934) (339,238) (13,003,771)
Sale of marketable securities....................................... 1,071,213 690,186 12,452,093
Other investing activities.......................................... (150,606) 10,650 (1,542,574)
----------- --------- -------------
Net cash provided by (used in) investigating activities.... 695,673 361,598 (2,094,252)
----------- -------- -------------
Cash flows from financing activities:
Proceeds from issuance of common shares............................. 11,025,260
Costs in connection with sale of common shares...................... (2,027,906)
Exercise of options and warrants.................................... 60,000 396,395
Proceeds from bridge loan........................................... 1,500,000
Payment of bridge loan.............................................. (1,500,000)
Payment of deferred financing fees.................................. (224,919)
Other financing activities.......................................... (43,661) (17,238) (83,791)
---------- --------- ----------
Net cash provided by (used in) financing activities..... (43,661) 42,762 9,085,039
----------- -------- ----------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS......................................................... (72,413) 34,836 85,302
Cash and cash equivalents, beginning of period......................... 154,726 50,466
---------- -------- -----------
CASH AND CASH EQUIVALENTS, END OF PERIOD............................... $ 82,313 $ 85,302 $ 85,302
========== ======== ===========
</TABLE>
The accompanying notes are an integral part of these
condensed financial statements.
-5-
<PAGE>
INFOSAFE SYSTEMS, INC.
(a development stage company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
(NOTE A) - Basis of Presentation and the Company:
(1) Basis of presentation:
The accompanying unaudited condensed financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and Article 3 of
Regulation S-B. 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 normal recurring accruals) considered necessary for fair presentation have
been included. Operating results for the three-month period ended October 31,
1996 and for the period from November 18, 1991 (inception) to October 31, 1996
are not necessarily indicative of the results that may be expected for the year
ending July 31, 1997.
The balance sheet at July 31, 1996 has been derived from the audited
financial statements at that date, but does not include all the information and
footnotes required by generally accepted accounting principles for complete
financial statements. For further information, refer to the audited financial
statements and footnotes thereto included in the Form 10-KSB, for the Company's
fiscal year ended July 31, 1996.
(2) Organization and business:
Infosafe Systems, Inc. (the "Company") is a development stage company
engaged in the development and marketing of secure electronic distribution and
metering systems for digital products. The Company has developed "The
Infosafe(R) System" which consists of hardware and software products to enable
publishers and other information owners to distribute digital information
without the risk of theft.
-6-
<PAGE>
INFOSAFE SYSTEMS, INC.
(a development stage company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
(NOTE B) - Summary of Significant Accounting Policies:
Loss per share of common stock:
Net loss per share of common shares is based on the weighted average
number of shares outstanding during the period, excluding Class B shares in
escrow and all Class E-1 and Class E-2 shares.
(NOTE C) - Equipment Held for Lease:
Equipment held for lease is composed of an encryption and metering
control. During the fiscal year ended July 31, 1996, the Company stopped
production of the control units until such time as the demand for the units
increases. Therefore, the Company has reduced the value of the control units to
reflect its remaining economic life. This resulted in a write down of long-lived
assets aggregating $30,000 for the three month period ended October 31, 1996.
(NOTE D) - Contingencies and Other Matters :
1) Effective November 26, 1996, the Company appointed Arthur R. Medici
as President and Chief Executive Officer pursuant to a three-year employment
agreement ("Agreement"). The Agreement provides for Mr. Medici to receive
aggregate annual base salary payments ranging from $175,000 to $225,000 over the
term. Mr. Medici is also entitled to receive an annual cash bonus and deferred
compensation payments in cash and Class A Common Stock based on the Company's
net profits, as defined. In addition, the Company agreed to issue to Mr. Medici
70,000 shares of Class B Common Stock, 135,000 Shares of Class E-1 Common Stock
and 135,000 shares of Class E-2 Common Stock, which shares cannot be transferred
by Mr. Medici prior to August 1999 and will be canceled by the Company if his
employment is terminated prior to August 1999. Pursuant to the Agreement, Mr.
Medici was also granted options to purchase 350,0000 shares of the Company's
Class A Common Stock, at an exercise price of $4.06 per share, one-third of
which are immediately exercisable and the balance of which shall become
exercisable if the Company achieves certain profit levels in the future.
-7-
<PAGE>
INFOSAFE SYSTEMS, INC.
(a development stage company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
(2) The Company and its former president were parties to an action
brought by the former employer of such officer. On May 3, 1996, the plaintiff
requested permission from the Court to discontinue its claims against the
Company and its president with prejudice. The Company has agreed that the claim
should be dismissed with prejudice and has asked the Court to require that the
plaintiff be required to pay a portion of the attorney's fees and costs the
Company has incurred in defending this action. The Company believes the
plaintiff's proposed claims lack any factual basis. If the plaintiff's claim is
not discontinued, the Company intends to vigorously defend such action.
In March 1996, the Company and its former president filed a counter
suit against the plaintiff seeking an award of $20 million for damages and
attorneys fees, as well as declamatory and injunctive relief. The plaintiff's
withdrawal of its claims does not affect the pendency of the Company's
counterclaim, which remains pending.
-8-
<PAGE>
Item 2: Management's Discussion and Analysis of Financial Condition and Results
of Operations
Except for the description of historical facts contained herein, this
Form 10-QSB contains certain forward-looking statements within the meaning of
the "safe harbor" provisions of the Private Securities Litigation Reform Act of
1995 concerning applications of the Company's technologies and the Company's
proposed products and future prospects, that involve risks and uncertainties,
including the possibility that the Company will (i) not receive financing prior
to December 31, 1996, (ii) be unable to commercialize products based on its
technology, or (iii) that it will ever achieve profitable operations, as
detailed herein under "Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations" and from time to time in the Company's
filings with the Securities and Exchange Commission and elsewhere. Such
statements are based on management's current expectations and are subject to a
number of factors and uncertainties which could cause actual results to differ
materially from those described in the forward-looking statements. The Company's
actual results could differ materially from those discussed herein.
Overview
The Company is a development stage company engaged in the development
and marketing of secure electronic distribution systems for digitally stored
information products. The Company commenced operations in January 1992. From
November 18, 1991 (inception) to October 31, 1996, the Company recognized
revenues of approximately $604,000, of which $455,000 was from one customer, and
had an accumulated deficit of approximately $8.7 million. The Company has
continued to operate at a deficit since inception and expects to continue to
operate at a deficit until such time as operations generate sufficient revenues
to cover costs.
The Company's first commercial product, the Design Palette(TM), has not
achieved commercial acceptance. The Company is currently evaluating the extent
to which it will continue to support the Design Palette system.
The Company and Copyright Clearance Center(R) ("CCC"), the largest
licensor of photocopy reproduction rights in the United States, entered into a
contract on December 11, 1996 under which the Company has agreed to install and
operate at commercial locations the first electronic copyright permission
vending system for CCC registered material. Under the terms of the agreement,
the Company will promptly commence marketing this proprietary turnkey
hardware/software system which allows customers at commercial locations to
easily obtain permission and conveniently pay royalties to photocopy CCC
registered materials. The Company is also investigating other potential
applications for its technologies. The viability of the Company depends on its
ability to successfully develop and market these and other products and there
can be no assurance that the Company will ever generate sufficient sales of its
technologies and services to yield significant revenues.
-9-
<PAGE>
Results of Operations
Three Months Ended October 31, 1996 Compared with Three Months
Ended October 31, 1995.
For the three months ended October 31, 1996 ("the 1996 Three Months"),
the Company recognized revenues of approximately $12,000 which resulted from
sales generated by the Design Palette. For the three months ended October 31,
1995 ("the 1995 Three Months ") the Company recognized revenues of approximately
$20,000, approximately $12,000 of which resulted from sales generated by the
Design Palette.
For the 1996 Three Months, assets held for lease were written down by
$30,000. The value of the assets held for lease was reduced to reflect the
assets remaining economic life.
Operating expenses were approximately $506,000 in the 1996 Three Months
and approximately $ 728,000 in the 1995 Three Months. Approximately one half of
this decrease is attributable to non-recurring costs incurred in the 1995 Three
Months relating to the launch of the Design Palette System, the Company's first
commercial product. The remainder of the decrease is due to the Company's
efforts to reduce overhead costs in the 1996 Three Months in order to conserve
its cash position.
The Company had income from investments of approximately $15,000 for
the 1996 Three Months and approximately $ 76,000 in the 1995 Three Months. The
investment income relates to interest earned on funds received during January
and February 1995 from the initial public offering prior to their expenditure.
The decrease in interest income is due to the decrease in these funds as they
were expended for operations.
Interest expense was approximately $500 in the 1996 Three Months and
approximately $10,000 in the 1995 Three Months. Interest expense is attributed
to the financing of various capital assets.
Due to the above, the Company had a net (loss) of $(524,200) in the
1996 Three Months compared with $(664,547) in the 1995 Three Months.
Liquidity and Capital Resources
The Company has experienced net losses and negative cash flow from
operations since its inception. At October 31, 1996, the Company had working
capital of approximately $200,000. The Company has financed its operations
primarily through private placements during fiscal 1994 and a public offering
during fiscal 1995. The Company anticipates losses to continue through the next
fiscal year as the Company attempts to market its products and develops new
applications for its technology. The Company does not have sufficient financial
resources to continue its operations beyond January 1997 without obtaining
financing. The Company is actively pursuing long-term and short-term financing
which may include debt and equity financing. There can be no assurance that the
Company will be able to obtain the necessary financing to continue its
operations or that the Company will realize sufficient revenue from
commercializing its technology. There also can be no assurance that any
financing will be
-10-
<PAGE>
available if needed or, if available, will be on terms acceptable to the
Company. In the event necessary financing is not obtained, the Company will be
materially adversely affected and will have to cease operations. These factors
raise substantial doubt regarding the ability of the Company to continue as a
going concern. The report of the Company's independent auditors on the Company's
financial statements as of July 31, 1996 and for the years then ended and for
the period from November 18, 1991 (inception) to July 31, 1996 contains a
paragraph regarding the uncertainty with respect to the ability of the Company
to continue as a going concern.
The Company has a net operating loss carryforward for tax purposes of
approximately $7.9 million to offset future taxable income for federal tax
purposes. The utilization of the loss carryforward to reduce future income taxes
will depend on the Company's ability to generate sufficient taxable income prior
to the expiration of the net operating loss carryforwards. The carryforward
expires from 2007 to 2011. The Internal Revenue Code and Regulations contain
provisions which limit the use of available net operating loss carryforwards in
any given year should significant changes (greater than 50%) in ownership
interests occur. Due to the initial public offering, the net operating loss
carryover of approximately $1,900,000 incurred prior to the initial public
offering will be subject to an annual limitation of approximately $400,000 until
the net operating loss is utilized or expires.
-11-
<PAGE>
PART II. OTHER INFORMATION
Item 1: Legal Proceedings
Other than as described below, there are no pending legal proceedings
to which the Company is a party.
The Company and its former President and Chief Executive Officer,
Thomas H. Lipscomb, now Chairman, are defendants in an action filed on November
25, 1994 in the Supreme Court of the State of New York for New York County by
Wave Systems Corp. ("Wave"). Mr. Lipscomb was co-founder and the former
President of Wave, a competitor of the Company, until July 1991. The plaintiff
alleged, among other things, that (i) Mr. Lipscomb and the Company
misappropriated trade secrets and proprietary and confidential business
information belonging to plaintiff, breached a confidentiality agreement with
the plaintiff and have engaged in unfair competition with the plaintiff; and
(ii) that it would be irreparably damaged by such wrongful appropriation and
unfair competition. The complaint makes a demand for damages in excess of $10
million, plus attorneys' fees against all three defendants, and injunctive
relief against the Company and Mr. Lipscomb barring the alleged misappropriation
and unfair competition.
In April, the Company presented to the court an affidavit from Dr. John
Michener, Wave's former Chief Scientist for seven years and the Wave officer who
verified Wave's complaint, stating Dr. Michener's belief that the Company had
not misappropriated any proprietary technical information or trade secrets
belonging to Wave. Wave subsequently has requested permission from the Court to
discontinue its claims against the Company and Mr. Lipscomb with prejudice. In
response, the Company has agreed that the claims should be dismissed with
prejudice and asked the Court to require that Wave be required to pay a portion
of the attorney's fees and costs the Company has incurred in defending this
action. If Wave's claim is not discontinued, the Company intends to continue to
vigorously defend this action. An unfavorable outcome in this litigation could
likely have a material adverse effect on the Company's business and financial
condition. In any event, the Company is unable to determine the amount of
liability, if any, it may incur and has thus not set up any reserve for such
claim. In addition, future costs which may be incurred in connection with this
litigation could have an adverse effect on the Company's future results of
operations.
In March 1996 the Company and Mr. Lipscomb filed a counter suit against
Wave seeking an award of $20 million for damages and attorneys fees as well as
declaratory and injunctive relief. The complaint alleges that Wave: (i)
conducted a predatory campaign of tortious interference against the Company's
business and financial relationships, trademarks and employees; (ii) commenced
baseless litigation against the Company to prevent it from obtaining financing,
selling to potential customers and entering into favorable business
relationships; and (iii) made material misrepresentation about the nature and
characteristics of the Company's goods and services. Wave's withdrawal of its
claims would not affect the pendency of the Company's counter claim, which
remains pending.
-12-
<PAGE>
Item 5: Other Information
On November 26, 1996 Arthur R. Medici was appointed President and Chief
Executive Officer of the Company, replacing Thomas H. Lipscomb, who was
appointed Chairman of the Board of Directors of the Company.
-13-
<PAGE>
Item 6: Exhibits and Reports on Form 8-K
(a) Exhibits:
4.2(1) Form of Underwriter's Option
4.3(1) Form of Warrant Agreement
4.5(1) Escrow agreement, as amended
4.6(1) Form of warrant expiring September 10, 2002
10.1(1) 1992 Stock Option Plan
10.2(1) 1994 Stock Option Plan
10.3(1) Employment Agreement with Thomas H. Lipscomb, as amended
10.4(1) Consulting agreement with Alan N. Alpern, as amended
10.5(1) Lease for Executive Offices, as supplemented
10.6(1) License and Option Agreement dated February 9, 1994 between
the Registrant and International Typeface Corporation
10.7(1) Employment agreement with Charlton Calhoun III, as amended
10.8(2) Agreement between International Typeface Corporation and the
Company dated April 21, 1995
10.9(3) Employment agreement with Arthur R. Medici
11.1 Computation of Net Loss Per Share
-------
(1) Incorporated by reference to the Company's Registration Statement on Form
SB-2 (File no. 33-83940)
(2) Incorporated by reference to the Company's Report on Form 8-K dated April
21, 1995
(3) Incorporated by reference to the Company's Report on Form 8-K dated
November 26, 1996
** Confidential treatment has been granted for portions of this Exhibit.
(b) Reports on Form 8-K:
No reports on Form 8-K were filed during the three months ended October
31, 1996. On December 5, 1996, the Company filed a Current Report on Form 8-K
regarding the appointment of Arthur R. Medici as President and Chief Executive
Officer of the Company effective November 26, 1996.
-14-
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Exchange
Act of 1934, the registrant has caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
INFOSAFE SYSTEMS, INC.
Dated: January 28, 1997
By: /s/ Arthur R. Medici
-------------------------------
Arthur R. Medici, President and
Chief Executive Officer
By: /s/ Thomas H. Lipscomb
-------------------------------
Thomas H. Lipscomb, Chairman of
the Board of Directors
By: /s/ Alan N. Alpern
-------------------------------
Alan N. Alpern, Chief Financial Officer
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Exchange
Act of 1934, the registrant has caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
INFOSAFE SYSTEMS, INC.
Dated: January 28, 1997
By: _____________________________________
Arthur R. Medici, President and
Chief Executive Officer
By: _____________________________________
Thomas H. Lipscomb, Chairman of
the Board of Directors
By: _____________________________________
Alan N. Alpern, Chief Financial Officer
<PAGE>
EXHIBIT INDEX
Exhibit No. Page No.
4.2(1) Form of Underwriter's Option
4.3(1) Form of Warrant Agreement
4.5(1) Escrow agreement, as amended
4.6(1) Form of warrant expiring September 10, 2002
10.1(1) 1992 Stock Option Plan
10.2(1) 1994 Stock Option Plan
10.3(1) Employment Agreement with Thomas H. Lipscomb, as amended
10.4(1) Consulting agreement with Alan N. Alpern, as amended
10.5(1) Lease for Executive Offices, as supplemented
10.6(1) License and Option Agreement dated February 9, 1994 between the
Registrant and International Typeface Corporation
10.7(1) Employment agreement with Charlton Calhoun III, as amended
10.8(2) Agreement between International Typeface Corporation and the
Company dated April 21, 1995
10.9(3) Employment agreement with Arthur R. Medici
11.1(4) Computation of Net Loss Per Share
27 Financial Data Schedule
----------
(1) Incorporated by reference to the Company's Registration Statement on Form
SB-2 (File no. 33-83940)
(2) Incorporated by reference to the Company's Report on Form 8-K dated April
21, 1995
(3) Incorporated by reference to the Company's Report on Form 8-K dated
November 26, 1996 (File no. 0-2562)
(4) Filed with the Company's Report on Form 10-QSB on December 16, 1996.
** Confidential treatment has been granted for portions of this Exhibit.
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000894738
<NAME> INFOSAFE SYSTEMS INC.
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUL-31-1996
<PERIOD-START> AUG-01-1996
<PERIOD-END> OCT-31-1996
<CASH> 85,302
<SECURITIES> 552,838
<RECEIVABLES> 18,410
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 752,979
<PP&E> 206,815
<DEPRECIATION> 105,903
<TOTAL-ASSETS> 1,609,587
<CURRENT-LIABILITIES> 546,981
<BONDS> 0
0
0
<COMMON> 57,644
<OTHER-SE> 997,088
<TOTAL-LIABILITY-AND-EQUITY> 1,609,587
<SALES> 11,678
<TOTAL-REVENUES> 11,678
<CGS> 14,641
<TOTAL-COSTS> 14,641
<OTHER-EXPENSES> 550,231
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 504
<INCOME-PRETAX> (524,200)
<INCOME-TAX> 0
<INCOME-CONTINUING> (524,200)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (524,200)
<EPS-PRIMARY> (.15)
<EPS-DILUTED> 0
</TABLE>
