FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1999
Commission File Number 0-23666
TRIPOS, INC.
(Exact Name of Registrant as Specified in its Charter)
Utah 43-1454986
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
1699 South Hanley Road
St. Louis, Missouri 63144
(Address of Principal Executive Offices and Zip Code)
(314) 647-1099
(Registrant's Telephone Number, Including Area Code)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirement
for the past 90 days.
Yes X No
Number of shares outstanding of the issuer's Common Stock, par
value $.01 per share, as of September 30, 1999: 3,290,132 shares.
TABLE OF CONTENTS
PART I FINANCIAL INFORMATION, Page
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets at
September 30, 1999 and December 31, 1998 3
Consolidated Statements of Operations
for Three and Nine Months Ended September 30, 1999
and September 30, 1998 4
Consolidated Statements of Cash Flows for Nine Months
Ended September 30, 1999 and September 30, 1998 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations 8
PART II OTHER INFORMATION 12
SIGNATURES 13
EXHIBITS 14
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements.
CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
Sep 30, Dec 31,
1999 1998
ASSETS
Current Assets:
Cash and cash equivalents $ 659 $ 1,774
Accounts receivable 9,136 12,451
Inventory 2,820 2,389
Prepaid expenses 1,057 1,278
Deferred income taxes 201 242
Total current assets 13,873 18,134
Notes receivable-trade 1,855 2,304
Notes receivable-other 917 863
Property and equipment, net of depreciation 14,172 11,076
Capitalized development costs, net 625 877
Goodwill, net of amortization 1,348 1,447
Investment in unconsolidated affiliates 2,423 1,982
Other, net 131 127
Total assets $ 35,344 $ 36,810
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt
and capital leases $ 256 $ 150
Notes payable (see Note 6) 4,000 178
Accounts payable 593 827
Accrued expenses 830 2,858
Deferred revenue 4,348 5,005
Total current liabilities 10,027 9,018
Long-term portion of capital leases 263 226
Long-term notes payable (see Note 6) 5,929 5,289
Long-term deferred revenue 1,664 2,303
Deferred income taxes 407 465
Shareholders' equity:
Common stock 33 33
Additional paid-in capital 18,238 17,980
Accumulated earnings (deficit) (1,226) 1,269
Accumulated other comprehensive income 9 227
Total shareholders' equity 17,054 19,509
Total liabilities and
shareholders' equity $ 35,344 $ 36,810
See accompanying notes.
Item 1. Financial Statements (continued)
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended Nine Months Ended
Sep 30, Sep 30, Sep 30, Sep 30,
1999 1998 1999 1998
Net sales:
Software licenses $ 2,389 $ 2,804 $ 5,941 $ 7,050
Support 2,005 2,054 6,153 5,879
Accelerated discovery services 817 386 3,709 2,090
Hardware 296 343 1,982 2,281
Total net sales 5,507 5,587 17,785 17,300
Operating costs and expenses:
Cost of sales 984 1,329 4,330 4,477
Sales and marketing 2,477 2,511 7,103 7,279
Research and development 2,009 1,580 6,542 4,377
General and administrative 1,330 936 3,727 2,798
Total costs and expenses 6,800 6,356 21,702 18,931
Loss from operations (1,293) (769) (3,917) (1,631)
Other income (expense), net (15) 877 (67) 1,332
Income (loss) before
income taxes (1,308) 108 (3,984) (299)
Income tax expense (benefit) (472) 38 (1,489) (108)
Net income (loss) $ (836) $ 70 $(2,495) $ (191)
Basic earnings (loss)
per share $(0.25) $0.02 $(0.76) $(0.06)
Diluted earnings (loss)
per share $(0.25) $0.02 $(0.76) $(0.06)
Diluted weighted average
number of shares 3,289 3,424 3,271 3,198
See accompanying notes.
Item 1. Financial Statements (continued)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)
Nine Months Ended
Sep 30, Sep 30,
1999 1998
Cash flows from operating activities
Net loss $(2,495) $ (191)
Adjustments to reconcile net loss to net
cash provided (used) by operating activities:
Depreciation of property and equipment 1,231 594
Amortization of capitalized
development costs 521 2,558
Deferred income taxes (17) (340)
Change in operating assets and liabilities:
Accounts receivable 2,864 3,042
Notes receivable-trade 449 (1,216)
Inventory (443) (1,408)
Prepaid expenses and other assets 213 (451)
Accounts payable and accrued expenses (2,198) (2,643)
Deferred revenue (1,011) 1,078
Net cash provided (used) by
operating activities (886) 1,023
Cash flows from investing activities:
Net purchases, sales, and maturities
of investments -- 1,252
Notes receivable-other (54) (54)
Purchases of property and equipment (4,336) (3,023)
Capitalized development costs (165) --
Other (465) (68)
Net cash used in investing activities (5,020) (1,893)
Cash flows from financing activities:
Stock issuance pursuant to stock plans 258 399
Proceeds from the issuance of
long-term debt 4,671 412
Payments on long-term debt and
capital leases (232) (160)
Net cash provided by financing activities 4,697 651
Effect of foreign exchange rate changes
on cash and cash equivalents 94 (43)
Net increase (decrease) in cash and
cash equivalents (1,115) (262)
Cash and cash equivalents at
beginning of period 1,774 5,277
Cash and cash equivalents at
end of period $ 659 $ 5,015
See accompanying notes.
Item 1. Financial Statements (continued)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(in thousands, except per share data)
(1) Summary of significant accounting policies
(a) Organization
Tripos, Inc. (the "Company") delivers science, software
tools, chemical products and analysis services that advance
customers' creativity and productivity in pharmaceutical, agrochem-
ical, biotechnology and related research industries worldwide.
The Company is also a value-added reseller of third party hardware
products required to operate its software products. A substantial
portion of the Company's business is conducted with pharmaceutical
companies, however, the Company is not economically dependent on
any customer on an ongoing basis.
(b) Basis of presentation
The accompanying unaudited consolidated financial statements
have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for
complete financial statements. These statements should be read in
conjunction with the Company's consolidated financial statements
for the year ended December 31, 1998 set forth in the Company's
Annual Report on Form 10-K filed with the Securities and Exchange
Commission. In the opinion of management, all normal recurring
adjustments necessary for a fair presentation of such financial
statements have been included. Operating results for the three-
and nine-month periods ended September 30, 1999 are not necessarily
indicative of the results that may be expected for the year ended
December 31, 1999.
(2) Income taxes
The provision for income taxes is computed using the liability
method. The primary difference between financial statement and
taxable income results from the use of different methods of
computing capitalized development costs, accrued vacation and
customer deposits.
(3) Comprehensive Income
The components of comprehensive income, net of related tax,
for the three- and nine-month periods ended September 30, 1998 and
1998 are as follows:
Three Months Nine Months Ended
Ended
Sep 30, Sep 30, Sep 30, Sep 30,
1999 1998 1999 1998
Net income (loss) $(836) $ 70 $(2,495) $ (191)
Foreign currency
translation adjustments 92 227 (218) 163
Comprehensive income (loss) $(744) $ 297 $(2,713) $ 28
The components of accumulated other comprehensive income, net
of related tax, at September 30, 1999 and December 31, 1998 are as
follows:
1999 1998
Foreign currency translation adjustments $ 9 $ 227
Accumulated other comprehensive income $ 9 $ 227
(4) Earnings Per Share
The following table sets forth the computation of basic and diluted
earnings per share for the periods ended September 30, 1999 and 1998.
Three Months Ended Nine Months Ended
Sep 30, Sep 30, Sep 30, Sep 30,
1999 1998 1999 1998
Numerator:
Numerator for basic and diluted
earnings (loss) per share $(836) $ 70 $(2,495) $ (191)
Denominator:
Denominator for basic earnings
(loss) per share-weighted
average shares 3,289 3,226 3,271 3,198
Effect of dilutive securities:
Employee stock options Note A -- 198 -- --
Denominator for diluted earnings
(loss) per share--adjusted
weighted average shares 3,289 3,424 3,271 3,198
and assumed conversions
Basic earnings (loss)
per share $(0.25) $0.02 $(0.76) $(0.06)
Diluted earnings (loss)
per share $(0.25) $0.02 $(0.76) $(0.06)
Note A: Employee stock options to purchase shares of the Company's
common stock are not included in the computation of diluted
earnings per share in the periods when the Company realized a net
loss because the effect would have been anti-dilutive.
(5) Inventory
The Company maintains a physical inventory of chemical
compound libraries in various states of completion. Costs
associated with the manufacture of compounds are calculated using
the standard cost method and are carried at the lower of cost or
market. Compounds that are acquired from third parties are also
carried at the lower of cost or market. Finished Goods inventory
may periodically contain costs of computer hardware that has been
acquired for resale to the Company's customers.
September 30, December 31,
1999 1998
Raw materials $ 395 $ 44
Work in process 258 1,764
Finished goods 2,167 581
$2,820 $2,389
(6) Long Term Debt
On April 30, 1999, the Company entered into a credit facility
with a bank, which refinanced an existing $12,000 Credit Agreement
and a mortgage note. The new Credit Agreement is for a total of
$15,320 which consists of three separate credit facilities: a
$3,320 secured real estate mortgage, a $4,000 three-year secured
term loan, and an $8,000 three-year revolving line of credit. The
Credit Agreement is collateralized by substantially all of the
Company's U.S. assets and stock pledges for the Company's U.S. and
foreign subsidiaries. The credit facility also requires the
Company to meet certain financial covenants, including various
coverage ratios.
Effective September 30, 1999, the Company and the bank agreed
to a waiver and second amendment to the credit facility to reflect
operating results of the third quarter and proceeds of financing
transactions described below. This amendment calls for adjustments
in covenant levels. The Company expects to meet the new covenant
levels in the fourth quarter of 1999 and during fiscal year 2000.
At September 30, 1999, the availability under the revolving line of
credit was $1.35 million.
Subsequent to September 30, 1999, the Company entered into a
financing transaction for a portion of its equipment at Tripos
Receptor Research Ltd. in England. The resulting capital lease
transaction generated $2.0 million in cash that was used to reduce
the term loan. In addition, the Company tendered its shares in
Phase-1 Molecular Toxicology, Inc. back to Phase-1 in exchange for
$1.0 million and a secured note in the amount of $0.82 million,
payable on November 8, 2000. The $1.0 million in cash was also
applied to the term loan. These two transactions combined to
reduce the outstanding balance on the term loan from $4.0 million
to $1.0 million. As a result of these transactions and the terms
of the second amendment to the credit agreement, the remaining
outstanding balance of the term loan is classified as short-term
debt pending its renegotiation or retirement.
(7) Recent Accounting Pronouncements
In June 1998, the Financial Accounting Standards Board issued
Statement No. 133, "Accounting for Derivative Instruments and
Hedging Activities" ("FAS 133"), which was required to be adopted
in years beginning after June 15, 1999. The FASB has since delayed
the effective date until years beginning after June 15, 2000. FAS
133 permits early adoption as of the beginning of any fiscal
quarter after its issuance. The Company expects to adopt the new
Statement effective January 1, 2001. FAS 133 will require the
Company to recognize all derivatives on the balance sheet at fair
value. The Company has not yet determined what the effect FAS 133
will be on the earnings and financial position of the Company.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Overview
Tripos, Inc. is a leader in discovery services, informatics and
products for life science organizations worldwide. Tripos' current
proprietary technologies and strategic relationships expand its
reputation in computational chemistry for efficient pharmacological
activity prediction and analysis, a major factor in customers' cost-
effective new product success. Based on scientific expertise in
these areas as well as a worldwide sales and marketing
organization, Tripos expanded its business model in 1997. The
Company now offers the following products and services: software,
software consulting services, technology transfer, screening
libraries, and contract discovery research. The Company continues
to be a reseller of third party hardware products that are
compatible with the Company's software products.
The Company's sales and expenses can vary from quarter to
quarter depending upon, among other things, the Company's ability
to produce compound libraries in a timely manner, the capital
expenditure budgets of its customers, lengthy sales cycles, market
acceptance of new products and enhanced versions of existing
products, the timing of new product introductions by the Company
and other vendors, changes in pricing policies by the Company,
partners and other vendors, and changes in general economic and
competitive conditions. In addition, the Company may choose to
negotiate a long-term software license contract that may, subject
to certain rules of SOP 97-2, be recognized ratably over the life
of the contract. A substantial portion of the Company's sales for
each quarter is attributable to a limited number of orders and
tends to be realized toward the end of each quarter. Thus, even
short delays or deferrals of sales near the end of a quarter can
cause quarterly results to fluctuate substantially. The Company
typically experiences greater gross margins on software licenses,
contract research, custom software development and chemical
compound sales than on sales of hardware. The Company's
profitability depends in part on the mix of its sales components
and not necessarily on total sales.
Year 2000 Issues
The Company provides software licenses that are activated and
remain active based on date and time of the computer where the
software resides. Management believes that Tripos' software
products currently offered to its customers are Year 2000
compliant. The Company relies on the hardware suppliers to address
any and all Year 2000 issues and provide letters of compliance to
the Company. The total dollar amount that the Company estimates
will be spent to remediate its Year 2000 issues relating to
software products currently offered and supported will not be
material and should not affect future financial results of
operations, liquidity or capital resources.
The Company has no software used for internal processing, other
than its software products that are already Year 2000 compliant,
that are more than three years old. When written, this software
was Year 2000 compliant. The Company has been verifying its Year
2000 compliance throughout 1998 and into 1999. In addition to
informal testing and purchases of Year 2000 compliant software and
equipment, the Company started development of a formal plan in
October 1998. The second phase of the planning, which was
completed in May 1999 includes a full written description of
potential problems. The third phase, consisting of developing a
written description of each solution and work-around as well as the
testing plan to validate a workable solution, was completed in June
1999. The fourth phase, validation of the proposed solutions, was
completed in July 1999. The Company began implementing the
solutions in July 1999. Finally, the Company's plan for compliance
was substantially complete by September 30, 1999. Remaining minor
upgrades will be completed early in the fourth quarter. When
finished, the implementation will mean that a) all computers are
Year 2000 compliant, or b) computers not Year 2000 compliant will
not affect the company's ability to conduct business, and c) no
changes will be made to already validated systems unless adequate
testing (re-validation) is performed.
Tripos is dependent upon many third parties for the operation of
the business. These include hardware and software suppliers,
suppliers of raw materials to the compound business, and suppliers
of business services such as payroll and accounting services. To
date, the Company is not aware of any external agent with a Year
2000 issue that would materially impact the Company's results of
operations, liquidity, or capital resources. The Company will make
appropriate contingency plans should a vendor or supplier report
that it is not Year 2000 compliant or will not be by January 1,
2000. However, the Company has no means of ensuring that external
agents will be Year 2000 ready. The inability of external agents
to complete their Year 2000 resolution process in a timely fashion
could materially impact the Company. The effect of non-compliance
by external agents is not determinable. The costs of the Year 2000
project are
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations (continued)
included in the Company's annual software and hardware budget.
These amounts do not differ materially from those costs experienced
in prior periods. Acquisitions of new hardware are dealt with as
part of the ordinary capital purchase process and were not
accelerated by the Year 2000. Other costs will be expensed or
capitalized according to established Company procedures. At
present, no material costs are anticipated, and during the periods
presented there have been no costs incremental to normal operating
activities.
The Company is currently assessing its contingency plans. These
contingency plans were developed as part of the remedial steps
taken in the second and third quarter of 1999.
Forward-looking statements
Except for the historical information and statements contained
in Management's Discussion and Analysis of Financial Condition and
Results of Operations ("MD&A"), the matters and items contained in
this document, including MD&A, contain certain forward-looking
statements that involve uncertainties and risks. The Company's
future results could differ materially from those discussed in this
document. Factors that could cause a contribution to such
differences, include, but are not limited to, those presented in
the Company's Form 10-K for the year ended December 31, 1998.
Results of Operations
Net sales for the third quarter of 1999 were $5.5 million
compared with $5.6 million for the third quarter of 1998. The
overall decrease in net sales for the quarter was attributed to a
decrease in the software line. Net sales for the first nine months
of 1999 were $17.8 million compared to $17.3 million for the same
period in 1998. Sales increases in accelerated discovery services
and software support more than offset decreases in software
licenses and hardware during the nine-month period.
For the three months ended September 30, 1999, software
licenses sales decreased 14.8% to $2.4 million. For the first nine
months of 1999, software license sales decreased 15.7% to $5.9
million compared to the same period for 1998. During 1999, quarter
and year-to-date software sales were adversely impacted by the
tightening of funding in portions of the biotech sector, along with
the timing of several large contracts. Support revenues for the
third quarter of 1999 decreased 2.3% to $2.0 million from the same
period in 1998. Support sales increased 4.7% to $6.2 million for
the nine-month period ending September 30, 1999. The decrease in
support revenues in the third quarter are attributable to the
decline of software license sales in the period. For the nine-
months year-to-date, support revenues increased as a result of
continuing sales of long-term token license sales, a portion of
which is allocated to support and recognized ratably over the life
of each agreement. Accelerated discovery services ("ADS") sales
increased 111.7% to $0.8 million in the third quarter of 1999 and
77.5% to $3.7 million for the nine-months year-to-date. The
increase in ADS revenue is due to the Company's continuing recovery
in making compound inventories available for sale along with
contract research design and synthesis relationships. Hardware
sales were essentially unchanged from the same three-month period
in the prior year at $0.3 million. For the first nine months of
1999, hardware sales decreased 13.1% to $2.0 million compared to
1998. Sales to existing customers represent 90% of total revenues
for the nine-month period. For the same period, sales of new
products represent 24% of software license and accelerated
discovery service sales.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations (continued)
Net sales for the Company's activities outside North America
represented approximately 57% of total sales for the first nine
months of 1999 compared to 45% for the same period in 1998. Net
sales in Europe increased to 47% of total net sales for the first
nine months of 1999 compared to 38% in 1998. Net sales in the
Pacific Rim, principally Japan, accounted for 10% and 7% of total
net sales for the first nine months of 1999 and 1998, respectively,
demonstrating the continuing recovery of the region.
Cost of sales for the quarter ending September 30, 1999
decreased 26.0% to $1.0 million and decreased 3.3% to $4.3 million
for the nine-month period in 1999. These decreases in cost of
sales were due to the decrease of hardware sales in the current
year and the higher mix of software products in the prior year with
trailing royalties. Cost of sales as a percent of net sales was
17.9% and 24.3% for the three- and nine-month periods in 1999, and
23.8% and 25.9% for the three- and nine-month periods in 1998,
respectively.
Gross profit margin percentage for the third quarter of 1999
increased to 82.1% from 76.2% in 1998. For the first nine months
of 1999, gross margin percentage increased to 75.7% from 74.1% for
the same period in 1998. The increase in gross margin percentage
in 1999 compared to 1998 is attributable to a charge in the prior
year for the write-down of remaining costs associated with the
Optiverse library of compounds.
Sales and marketing expenses remained flat at $2.5 million for
the three-month period in 1999 and decreased 2.4% to $7.1 million
for the nine-month period. Sales and marketing expenses as a
percentage of net sales were 45.0% and 40.0% for the three- and
nine-month periods in 1999 as compared to 44.9% and 42.1% for the
same periods in 1998.
Research and development costs for the three-month period in
1999 increased 27.1% to $2.0 million compared to $1.6 million for
the same period in 1998. R&D expenditures for the nine-months year-
to-date increased 49.5% to $6.5 million. R&D costs represented
36.5% and 28.3% of net sales for the quarter in 1999 and 1998,
respectively, and 36.8% and 25.3% of net sales for the nine-month
periods. The increases in R&D expenses as a percentage of net
sales reflect the decrease in the amount of capitalized costs as
the Company continues to move from long-term software development
cycles to a shorter-term development cycle for web-based software
applications, expansion of the software consulting staff, the
increase in chemistry staff at Tripos Receptor Research, and shared
costs for the collaborations with the Wolfson Institute and Arena
Pharmaceuticals, Inc.
General and administrative expenses increased to $1.3 million
for the third quarter of 1999 compared to $0.9 million in 1998, and
represent 24.2% and 16.8% of net sales for the respective periods.
For the nine-month period, G & A expenses were $3.7 million and
$2.8 million in 1999 and 1998, respectively. G&A year-to-date
percent to net sales was 21.0% in 1999 and 16.2% in 1998. The
increases in G&A percent to sales for 1999 relate to the addition
of administrative staff at Tripos Receptor Research Ltd. along with
increased costs attributable to improvements in network
communications infrastructure.
Other income decreased from $0.9 million for the third quarter
in 1998 to $0.1 million of net expense for the comparable period in
1999. For the first nine months of 1999, other expense was $0.1
million compared to income of $1.3 million in 1998. These changes
were due to the acceleration of the amortization of deferred costs
from a prior credit facility earlier this year and the
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations (continued)
recognition of guaranteed income from the transfer of the rights to
the Optiverse library to MDS/Panlabs in the third quarter of 1998.
Income tax benefit was $1.5 million for the nine-month period
in 1999 which represents an effective tax rate of 37% compared to
$0.1 million of benefit at a rate of 36% for the same period in
1998. The Company's effective tax rate for the nine-months ended
September 30, 1999 reflects the expected effective tax rate for the
year ending December 31, 1999.
Liquidity, Capital Resources and Capital Commitments
For the nine-month period ending September 30, 1999, net cash
used by operations was $0.9 million as a result of a net loss of
$2.5 million, depreciation and amortization of $1.8 million. For
the same period in 1998, net cash provided by operations was $1.0
million.
Investment of $4.3 million in property and equipment,
primarily at Tripos Receptor Research, and the early 1999
completion of the Company's investment in Arena Pharmaceuticals of
$0.5 million, resulted in a use of cash for investing activities in
the first three quarters of 1999 of $5.0 million. In the prior
year, investment of $3.0 million in property and equipment was
partially self-funded by maturities of marketable securities
resulting in a net use of cash of $1.9 million. The facilities at
Tripos Receptor Research were substantially completed in the second
quarter of 1999 with remaining production-related capital being
disbursed in the third quarter. Compound production levels reached
the Company's targeted levels during the period. As a result, any
future laboratory capital will be directly related to incremental
revenue opportunities. The Company believes that current working
capital together with continued cashflow from operations and the
$1.35 million availability under the line of credit with LaSalle
Bank, N.A., will be adequate to fund liquidity requirements
including investments in research and development, capital
purchases, and any other commitments in the upcoming year.
Effective September 30, 1999, the Company and the bank agreed
to a waiver and second amendment to the credit facility to reflect
operating results of the third quarter and proceeds of financing
transactions described below. This amendment calls for adjustments
in covenant levels. The Company expects to meet the new covenant
levels in the fourth quarter of 1999 and during fiscal year 2000.
At September 30, 1999, the availability under the revolving line of
credit was $1.35 million.
Subsequent to September 30, 1999, the Company entered into a
financing transaction for a portion of its equipment at Tripos
Receptor Research Ltd. in England. The resulting capital lease
transaction generated $2.0 million in cash that was used to reduce
the term loan. In addition, the Company tendered its shares in
Phase-1 Molecular Toxicology, Inc. back to Phase-1 in exchange for
$1.0 million and a secured note in the amount of $0.82 million,
payable on November 8, 2000. The $1.0 million in cash was also
applied to the term loan. These two transactions combined to
reduce the outstanding balance on the term loan from $4.0 million
to $1.0 million. As a result of these transactions and the terms
of the second amendment to the credit agreement, the remaining
outstanding balance of the term loan is classified as short-term
debt pending its renegotiation or retirement.
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
The Company is not a party to any material litigation and
is not aware of any threatened material litigation.
Item 2. Changes in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) List of Exhibits
27 Financial Data Schedule
(b) No reports on Form 8-K were required to be filed
during the period from June 30, 1999 to September 30, 1999.
TRIPOS, INC.
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.
TRIPOS, INC.
Date: November 10, 1999 John P. McAlister /s/
John P. McAlister
President and
Chief Executive Officer
Date: November 10, 1999 Colleen A. Martin /s/
Colleen A. Martin
Chief Financial Officer, Secretary
Exhibit Index
Exhibit No. Description
27 Financial Data Schedule
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<INCOME-TAX> (1489)
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<CHANGES> 0
<NET-INCOME> (2495)
<EPS-BASIC> (0.76)
<EPS-DILUTED> (0.76)
</TABLE>
