================================================================================
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.
-------------
[ ] 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 0-28674.
-------
CADUS PHARMACEUTICAL CORPORATION
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 13-3660391
- ------------------------------------ -----------------------------------
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
777 Old Saw Mill River Road, Tarrytown, New York 10591-6705
- ------------------------------------------------ ----------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (914) 345-3344
----------------------
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
--- ---
The number of shares of registrant's common stock, $.01 par value, outstanding
as of August 5, 1996 was 12,045,690.
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<PAGE>
<TABLE>
<CAPTION>
CADUS PHARMACEUTICAL CORPORATION
INDEX
Page No.
--------
<S> <C>
PART I -- FINANCIAL INFORMATION
Item 1. Financial Statements 1
Balance Sheets -- June 30, 1996 and December 31, 1995
Statements of Operations -- Three and six months ended June 30, 1996
and 1995, and the period from January 23, 1992 (date of inception) to
June 30, 1996 2
Statements of Cash Flows -- Six months ended June 30, 1996 and 1995,
and the period from January 23, 1992 (date of inception) to June 30,
1996 3
Notes to Financial Statements 4,5
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 6-8
PART II -- OTHER INFORMATION 9
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES 10
EXHIBIT INDEX 11
</TABLE>
<PAGE>
CADUS PHARMACEUTICAL CORPORATION
(a development stage corporation)
BALANCE SHEETS
<TABLE>
ASSETS
<CAPTION>
June 30, December 31,
1996 1995
----------- -----------
<S> <C> <C>
Current assets:
Cash and cash equivalents .................................................... S24,250,180 $25,682,920
Restricted cash .............................................................. 2,380,000 2,380,000
Prepaid and other current assets ............................................. 618,320 76,810
----------- -----------
Total current assets ..................................................... 27,248,500 28,139,730
Restricted cash ................................................................ 118,000 118,000
Fixed assets, net of accumulated depreciation and amortization of
$1,011,100 at June 30, 1996 and $649,016 at December 31, 1995 ................ 2,319,090 2,219,851
Deferred tax asset, less valuation allowance of $2,692,000 at June 30, 1996
and $2,621,000 at December 31, 1995 -- --
Due from stockholder ........................................................... 9,855 13,736
Other assets, net .............................................................. 453,889 233,874
----------- -----------
Total assets ............................................................. $30,149,334 $30,725,191
=========== ===========
LIABILITIES AND STOCKHOLDERS EQUITY
Current liabilities:
Accounts payable ........................................................... $ 23,228 $ 154,463
Accrued expenses and other current liabilities ............................. 150,309 421,155
Line of credit and loans payable to bank-current position .................. 2,397,459 2,397,459
----------- -----------
Total current liabilities ............................................... 2,570,996 2,973,077
Loans payable to bank ...................................................... 20,494 29,002
----------- -----------
Total liabilities ....................................................... 2,591,490 3,002,079
Stockholders' equity:
Preferred stock, $.001 par value
Authorized 22,201,080 shares at June 30, 1996 and December 31, 1995,
issuable in series. Convertible Preferred Stock, Series A. 14,879,651
shares designated; issued and outstanding at June 30, 1996 and
December 31, 1995, 14,879,651 shares (preference in liquidation,
$6,800,000) .............................................................. 14,880 14,880
Convertible Preferred Stock, Series B. 7,321,429 shares designated;
issued and outstanding at June 30, 1996 and December 31, 1995,7,321,429
shares (preference in liquidation, $27,500,000) .......................... 7,321 7,321
Common Stock, $.01 par value. Authorized 35,000,000 shares at June 30, 1996
and December 31, 1995; issued 1,473,343 shares at June 30, 1996 and 1,465,009
shares at December 31, 1995; outstanding 1,331,676 shares at June 30, 1996
and 1,323,342 shares at December 31, 1995 .................................... 14,733 14,650
Additional paid-in capital ..................................................... 33,988,282 33,976,940
Deficit accumulated during the development stage ............................... (6,167,297) (5,990,604)
Treasury stock, 141,667 shares at June 30, 1996 and
December 31, 1995, at cost ................................................... (300,075) (300,075)
----------- -----------
Total stockholders' equity .............................................. 27,557,844 27,723,112
----------- -----------
Total liabilities and stockholders' equity .............................. $30,149,334 $30,725,191
=========== ===========
</TABLE>
See accompanying notes to the financial statements
1
<PAGE>
<TABLE>
CADUS PHARMACEUTICAL CORPORATION
(a development stage corporation)
STATEMENTS OF OPERATIONS
<CAPTION>
January 23,
Three Months Ended Six Months Ended 1992 (date of
June 30, June 30, inception) to
------------------------ ------------------------ June 30,
1996 1995 1996 1995 1996
---------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C>
Revenues, principally from related parties ............. $1,625,001 $1,000,000 $3,250,002 $2,000,000 $ 9,022,430
---------- ---------- ---------- ---------- -----------
Costs and expenses:
Research and development costs ..................... 1,783,294 1,067,406 3,437,685 2,107,781 13,466,207
General and administrative expenses ................ 302,839 299,336 620,516 616,501 3,696,906
---------- ---------- ---------- ---------- -----------
Total costs and expenses ........................ 2,086,133 1,366,742 4,058,201 2,724,282 17,163,113
---------- ---------- ---------- ---------- -----------
Operating loss ......................................... (461,132) (366,742) (808,199) (724,282) (8,140,683)
---------- ---------- ---------- ---------- -----------
Interest income ........................................ 364,610 189,316 723,945 404,827 2,071,418
Interest expense ....................................... 31,004 15,247 68,859 21,575 151,788
---------- ---------- ---------- ---------- -----------
Interest income, net ............................ 333,606 174,069 655,086 383,252 1,919,630
---------- ---------- ---------- ---------- -----------
Loss before income taxes and extraordinary gain ........ (127,526) (192,673) (153,113) (341,030) (6,221,053)
State and local taxes .................................. 6,000 4,962 23,580 11,432 104,892
---------- ---------- ---------- ---------- -----------
Loss before extraordinary item ......................... (133,526) (197,635) (176,693) (352,462) (6,325,945)
Extraordinary item from early extinguishment of debt.... -- -- -- -- 158,648
---------- ---------- ---------- ---------- -----------
Net loss ............................................... $ (133,526) $ (197,635) $ (176,693) $ (352,462) $(6,167,297)
========== ========== ========== ========== ===========
Net loss per share ..................................... $ (0.10) $ (0.03)
========== ==========
Shares used in calculation of net loss per share ....... 1,331,676 5,204,317
========== ==========
</TABLE>
See accompanying notes to the financial statements
2
<PAGE>
<TABLE>
CADUS PHARMACEUTICAL CORPORATION
(a development stage corporation)
STATEMENTS OF CASH FLOWS
<CAPTION>
January 23,
Six Months Ended 1992 (date of
June 30, inception) to
-------------------------- June 30,
1996 1995 1996
----------- ----------- ------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss ................................................................. $ (176,693) $ (352,462) $(6,167,297)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization .......................................... 347,897 171,694 1,093,115
Loss on trade in of equipment .......................................... -- -- 2,658
Extraordinary gain from early extinguishment of debt ................... -- -- (158,648)
Changes in assets and liabilities:
(Increase) decrease in prepaid and other current assets .............. (541,510) 5,597 (618,320)
(Increase) decrease in other assets .................................. (148,099) 5,089 (153,104)
Decrease in deferred revenue ......................................... -- (645,381) --
(Decrease) increase in accounts payable .............................. (131,235) (222,078) 23,228
(Decrease) increase in accrued expenses .............................. (270,846) (54,872) 150,309
----------- ----------- -----------
Net cash used in operating activities ............................ (920,486) (1,092,413) (5,828,059)
----------- ----------- -----------
Cash flows from investing activities:
Acquisition of fixed assets ............................................ (461,323) (1,503,360) (3,320,621)
Increase in restricted cash ............................................ -- (1,316,730) (2,498,000)
Stockholder borrowing .................................................. 3,881 3,881 (9,855)
Patent costs ........................................................... (57,729) (13,081) (320,027)
----------- ----------- -----------
Net cash used in investing activities ............................ (515,171) (2,829,290) (6,148,503)
----------- ----------- -----------
Cash flows from financing activities:
Proceeds from bank line of credit ...................................... -- 1,313,000 2,380,000
Payments on bank loan .................................................. (8,508) (7,805) (37,047)
Proceeds from stockholder .............................................. -- -- 2,158,648
Proceeds from issuance of common stock and exercise of stock options ... 11,425 -- 153,115
Net proceeds from issuance of convertible preferred stock .............. -- -- 31,872,101
Purchase of treasury stock ............................................. -- -- (300,075)
----------- ----------- -----------
Net cash provided by financing activities ........................ 2,917 1,305,195 36,226,742
----------- ----------- -----------
Net (decrease) increase in cash and cash equivalents.............. (1,432,740) (2,616,508) 24,250,180
Cash and cash equivalents at beginning of period ......................... 25,682,920 14,405,678 --
Cash and cash equivalents at end of period ............................... $24,250,180 $11,789,170 $24,250,180
=========== =========== ===========
</TABLE>
See accompanying notes to the financial statements
3
<PAGE>
CADUS PHARMACEUTICAL CORPORATION
(a development stage corporation)
NOTES TO FINANCIAL STATEMENTS
(1) ORGANIZATION AND BASIS OF PREPARATION
The information presented as of June 30, 1996, and for the three and six
month periods then ended is unaudited, but includes all adjustments
(consisting only of normal recurring accruals) that the Company's
management believes to be necessary for the fair presentation of results
for the periods presented. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with
generally accepted accounting principles have been omitted pursuant to the
requirements of the Securities and Exchange Commission, although the
Company believes that the disclosures included in these financial
statements are adequate to make the information not misleading. The
December 31, 1995 balance sheet was derived from audited financial
statements. These financial statements should be read in conjunction with
the Company's audited financial statements for the year ended December 31,
1995. Certain reclassifications have been made to the prior year financial
statement amounts to conform with the presentation in the current year
financial statements.
The results of operations for the six-month period ended June 30, 1996 are
not necessarily indicative of the results to be expected for the year
ending December 31, 1996.
The Company has accumulated a loss of $6,167,297 from January 23, 1992
(date of inception) to June 30, 1996. Management intends to continue
research toward the development of commercial products in order to generate
future revenues from license fees, royalties, direct sales and performance
of contract research.
(2) DEVELOPMENT STAGE ENTERPRISE
The efforts of the Company since inception have been devoted to research
and development and raising capital. Accordingly, the financial statements
are presented under the guidelines stipulated by the Financial Accounting
Standards Board's Statement of Financial Accounting Standards ("SFAS")
No. 7, "Accounting and Reporting by Development Stage Enterprises."
(3) NET LOSS PER SHARE
All common share data has been restated to give effect to a one-for-three
reverse stock split effected on July 18, 1996 (see note 5). Except as noted
below, net loss per share is computed using the weighted average number of
shares of common stock outstanding. Historical earnings per share have not
been presented because such amounts are not meaningful due to the
significant change in the Company's capital structure that occurred in
connection with the Company's initial public offering.
For the three month period ended March 31, 1996, pursuant to Securities and
Exchange Commission Staff Accounting Bulletin No. 83, the Series B
Convertible Preferred Stock (using the if-converted method) and stock
options (using the treasury stock method and the initial public offering
price) issued at prices substantially below the public offering price
during the 12-month period prior to the offering have been included in the
calculation as if they were outstanding for all periods presented.
Furthermore, common equivalent shares from convertible preferred stock
issued prior to the 12-month period preceding the offering that converted
upon the completion of the Company's initial public offering are included
in the calculation (using the if-converted method) from the original date
of issuance. Common equivalent shares from stock options issued prior to
the 12-month period preceding the offering are excluded from the
computation as their effect is anti-dilutive.
For the three month period ended June 30, 1996, common equivalent shares
from stock options and convertible preferred stock are excluded from the
computation as their effect is anti-dilutive.
4
<PAGE>
CADUS PHARMACEUTICAL CORPORATION
(a development stage corporation)
NOTES TO FINANCIAL STATEMENTS
(4) SUPPLEMENTAL CASH FLOW INFORMATION
SIX MONTHS
ENDED JUNE 30, PERIOD FROM JANUARY 23, 1992
---------------------- (DATE OF INCEPTION) TO
1996 1995 JUNE 30, 1996
---------------------- -------------------------
Cash payments for:
Interest............. $68,859 $21,575 $151,788
======= ======= ========
Income taxes ........ $23,581 $11,432 $104,892
======= ======= ========
(5) SUBSEQUENT EVENTS
Public Offering of Common Stock
In July 1996, the Company completed an initial public offering of 2,750,000
shares of Common Stock at $7.00 per share. The Company received proceeds,
net of underwriting discounts and commissions, of $17,902,500.
On August 5, 1996, the Company sold an additional 412,500 shares of Common
Stock at $7.00 per share pursuant to the exercise by the underwriters of an
over-allotment option granted to them. The Company received proceeds, net
of underwriting discounts and commissions, of $2,685,375.
Reverse Stock Split
On July 18, 1996, the Company effected a one-for-three reverse Common Stock
split and changed the par value of the Common Stock to $.01 from $.001. All
Common Stock data have been restated to give effect to this reverse stock
split and change in par value for all periods presented.
Conversion of Convertible Preferred Stock
On July 22, 1996, all outstanding shares of the Series A and Series B
Preferred Stock were converted into an aggregate of 7,551,514 shares of
Common Stock.
5
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
OVERVIEW
The Company was incorporated in 1992 and has devoted substantially all of
its resources to the development and application of novel yeast-based and
signal transduction drug discovery technologies. The Company has financed
its operations primarily through the sale of Convertible Preferred Stock.
To date, all of the Company's revenues have resulted from research funding
provided by its collaborative partners.
The Company has incurred operating losses in each year since its inception
and net losses of approximately $177,000 during the six months ended June
30, 1996. At June 30, 1996, the Company had an accumulated deficit of
approximately $6.2 million. The Company's losses have resulted principally
from costs incurred in research and development and from general and
administrative costs associated with the Company's operations. These costs
have exceeded the Company's revenues and interest income. The Company
expects to incur substantial additional operating losses over the next
several years as a result of increases in its expenses for research and
product development.
RESULTS OF OPERATIONS
Six Months Ended June 30, 1996 and June 30, 1995
Revenues
Revenues for the six months ended June 30, 1996 increased to $3.3 million
from $2.0 million for the same period in 1995. This increase was
attributable to the inclusion in 1996 of research funding from Solvay
Duphar B.V. ("Solvay Duphar"), one of the Company's collaborative partners.
Operating Expenses
The Company's research and development expenses for the six months ended
June 30, 1996 increased to $3.4 million from $2.1 million for the same
period in 1995. This increase was attributable primarily to an increase in
staffing related to implementation of the research collaboration with
Solvay Duphar, as well as expenses in connection with licenses from third
parties and facilities expenses related to the Company's occupancy of its
facility in Tarrytown, New York.
General and administrative expenses for the six months ended June 30, 1996
increased to $621,000 from $617,000 for the same period in 1995.
Interest Income
Net interest income for the six months ended June 30, 1996 increased to
$655,000 from $383,000 for the same period in 1995. This increase related
primarily to interest earned on the net proceeds from the sale of Series B
Convertible Preferred Stock ("Series B Preferred Stock") in September 1995
and November 1995, net of interest expense on a line of credit and bank
loans.
Net loss
The net loss for the six months ended June 30, 1996 decreased to $177,000
from $352,000 for the same period in 1995. The decrease can be attributed
to the increase in interest earned on the net proceeds from the sale of
Series B Preferred Stock in September 1995 and November 1995.
6
<PAGE>
Three Months Ended June 30, 1996 and June 30, 1995
Revenues
Revenues for the three months ended June 30, 1996 increased to $1.6 million
from $1.0 million for the same period in 1995. This increase was
attributable to the inclusion in 1996 of research funding from Solvay
Duphar.
Operating Expenses
The Company's research and development expenses for the three months ended
June 30, 1996 increased to $1.8 million from $1.1 million for the same
period in 1995. This increase was attributable primarily to an increase in
staffing related to implementation of the research collaboration with
Solvay Duphar, as well as facilities expenses in connection with the
Company's occupancy of its facility in Tarrytown, New York.
General and administrative expenses for the three months ended June 30,
1996 increased to $303,000 from $276,000 for the same period in 1995.
Interest Income
Net interest income for the three months ended June 30, 1996 increased to
$334,000 from $174,000 for the same period in 1995. This increase related
primarily to interest earned on the net proceeds from the sale of Series B
Preferred Stock in September 1995 and November 1995, net of interest
expense on a line of credit and bank loans.
Net loss
The net loss for the three months ended June 30, 1996 decreased to $134,000
from $198,000 for the same period in 1995. The decrease can be attributed
to the increase in interest earned on the net proceeds from the sale of
Series B Preferred Stock in September 1995 and November 1995.
LIQUIDITY AND CAPITAL RESOURCES
Since inception, the Company has financed its operations through the sale
of Convertible Preferred Stock and from research funding from its
collaborative partners. Through June 30, 1996, the Company had sold
Convertible Preferred Stock for $31.9 million in cash and $2.0 million in
satisfaction of indebtedness. In addition, the Company had received $9.0
million in revenues for research funding.
In July 1996, the Company completed an initial public offering of 2,750,000
shares of Common Stock at $7.00 per share. The Company received proceeds,
net of underwriting discounts and commissions, of $17,902,500.
On August 5, 1996, the Company sold an additional 412,500 shares of Common
Stock at $7.00 per share pursuant to the exercise by the underwriters of an
over-allotment option granted to them. The Company received proceeds, net
of underwriting discounts and commissions, of $2,685,375.
The Company also has established a $2.5 million secured line of credit with
a bank, of which borrowings of $2.4 million were outstanding as of June 30,
1996. All obligations of the Company with respect to this line of credit
are secured pursuant to a security agreement granting the bank a first and
prior security interest in the Company's negotiable certificates of deposit
held by the bank. Such certificates of deposit have been recorded in the
balance sheet as "Restricted Cash." The right to borrow additional amounts
under the line of credit expired on June 30, 1996. The $2.4 million
outstanding at June 30, 1996 is payable on demand.
As of June 30,1996, the Company had cash and cash equivalents of $24.3
million and restricted cash of $2.5 million.
7
<PAGE>
The Company has invested $3.3 million in property and equipment, including
purchases amounting to $461,000 in the six months ended June 30, 1996. The
Company expects capital expenditures to increase over the next several
years as it expands facilities to support the planned expansion of research
and development efforts.
The Company intends to increase its expenditures substantially over the
next several years to enhance its technologies and pursue internal
proprietary drug discovery programs. The Company believes that its existing
capital resources (including the proceeds of the recent public offering),
together with interest income and future payments due under its research
collaborations, will be sufficient to support its current and projected
funding requirements through the end of 1999. The Company's capital
requirements may vary as a result of a number of factors, including the
progress of its drug discovery programs, competitive and technological
developments, the continuation if its existing collaborative agreements and
the establishment of additional collaborative agreements, and the progress
of the development efforts of the Company's corporate partners. The Company
expects that it will require significant additional financing in the
future, which it may seek to raise through public or private equity
offerings, debt financings or additional corporate partnerships. No
assurance can be given that such additional financing will be available
when needed or that, if available, such financing will be obtained on terms
favorable to the Company. To the extent that additional capital is raised
through the sale of equity or convertible debt securities, the issuance of
such securities could result in dilution to the Company's stockholders. The
Company's forecast of the period of time through which its financial
resources will be adequate to support its operations is forward-looking
information, and, as such, actual results may vary.
8
<PAGE>
PART II -- OTHER INFORMATION
Item 1. Legal Proceedings
The registrant is not a party to any material legal proceedings other
than SIBIA Neurosciences, Inc. v. Cadus Pharmaceutical Corporation. SIBIA
Neurosciences, Inc. ("SIBIA") commenced an action on July 9, 1996 in the
United States District Court for the Southern District of California
alleging infringement by the Company of a patent relating to an aspect of
drug screening techniques and seeking injunctive relief and monetary
damages. On August 1, 1996, the Company filed an Answer and Counterclaim,
claiming that the patent is not infringed and is invalid and unenforceable,
seeking a declaratory judgment of patent invalidity, unenforceability and
noninfringement, and claiming intentional and tortious interference by
SIBIA with the Company's initial public offering. The Company intends to
vigorously defend against the claims made by SIBIA and to pursue its
counterclaims against SIBIA.
Item 2. Changes in Securities
Nothing to report.
Item 3. Defaults Upon Senior Securities
Nothing to report.
Item 4. Submission of Matters to a Vote of Security-Holders
As of May 23, 1996, the security-holders of the Company, pursuant to
Section 228(a) of the General Corporation Law of the State of Delaware,
approved by written consent the adoption of (i) a Certificate of Amendment
to the Company's Certificate of Incorporation that effectuates a
one-for-three reverse stock split of the Company's outstanding Common Stock
and that provides directors with indemnification to the fullest extent
permitted by Delaware law, (ii) an Amended and Restated Certificate of
Incorporation of the Company and (iii) the Company's 1996 Incentive Plan.
On June 14, 1996, the Company held its annual meeting of stockholders,
at which meeting the Board of Directors of the Company as previously
reported to the Securities and Exchange Commission was re-elected in its
entirety. Proxies for the meeting were not solicited pursuant to Regulation
14 under the Securities Exchange Act of 1934.
Item 5. Other Information
Nothing to report.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
The exhibits listed in the Exhibit Index are included in this
report.
(b) Reports on Form 8-K
None
9
<PAGE>
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.
CADUS PHARMACEUTICAL CORPORATION
(Registrant)
Date: August 30, 1996 By /s/JAMES S. RIELLY
-------------------------------------------
James S. Rielly
Director of Finance, Controller and
Treasurer
(Authorized Officer and Principal Financial
Officer)
10
<PAGE>
EXHIBIT INDEX
The following exhibits are filed as part of this Quarterly Report on Form
10-Q:
Exhibit No. Description
----------- -----------
11 Computation of Net Loss Per Share
27 Financial Data Schedule
11
EXHIBIT 11
COMPUTATION OF NET LOSS PER SHARE
Three Months Six Months
Ended Ended
June 30, 1996 June 30, 1996
------------- -------------
Net Loss ....................................... $ (133,526) $ (176,693)
---------- ----------
Weighted Avg. number of shares of common stock
outstanding during the periods after giving
effect to the 1-3 reverse stock split ........ 1,331,676 1,329,106
Common equivalent shares from stock options
issued during the 12-month period
prior to the registration statement filing
using the treasury stock method .............. -- 99,462
Conversion of Series A Convertible Preferred
Stock using the if-converted method .......... -- 2,479,942
Conversion of Series B Convertible Preferred
Stock using the if-converted method .......... -- 1,295,807
---------- ----------
Shares used in calculation of EPS .............. 1,331,676 5,204,317
Net Loss per share ............................. $ (0.10) $ (0.03)
========== ==========
12
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE BALANCE SHEET, INCOME STATEMENT
AND EXHIBIT 11 AND IS QUALIFIED IN ITS ENTIRETY BY
RFEFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 24,250,180
<SECURITIES> 0
<RECEIVABLES> 9,855
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 27,248,500
<PP&E> 3,330,190
<DEPRECIATION> 1,011,100
<TOTAL-ASSETS> 30,149,334
<CURRENT-LIABILITIES> 2,570,996
<BONDS> 20,494
0
22,201
<COMMON> 14,733
<OTHER-SE> 27,520,910
<TOTAL-LIABILITY-AND-EQUITY> 30,149,334
<SALES> 0
<TOTAL-REVENUES> 3,250,002
<CGS> 0
<TOTAL-COSTS> 4,058,201
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 68,859
<INCOME-PRETAX> (176,693)
<INCOME-TAX> 0
<INCOME-CONTINUING> (176,693)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (176,693)
<EPS-PRIMARY> (.03)
<EPS-DILUTED> 0
</TABLE>
