ArQule, Inc.
Ticker:ARQL 200 Boston Avenue
Exchange:NASDAQ-National Market Medford, Massachusetts 02155
Industry:Manufacturing (617) 395-4100

Type of Shares:Common Shares Filing Date:8/29/96
U.S. Shares:2,500,000 Offer Date:10/16/96
Non-U.S. Shares:0 Filing Range:$11.00 - $13.00
Primary Shares:2,500,000 Offer Price:$12.00
Secondary Shares:0 Gross Spread:$0.84
Offering Amount: $30,000,000 Selling:$0.48
Expenses:$800,000 Reallowance:$0.10
Shares Out After:9,476,487

ManagerTierPhone
Hambrecht & Quist IncorporatedLead Manager (415) 576-3423
Oppenheimer & Company, Inc.Co-manager (212) 667-7402
Vector Securities International, Inc.Co-manager (708) 940-1970

Auditor: Price Waterhouse
6 Month Ending Financials
Audited
Income
Latest
Unaudited
Income
Prior
Unaudited
Income
Balance
Sheet
12/31/95 6/30/96 6/30/95 6/30/96
Revenue:$3.33$2.98$1.52Assets:$11.85
Net Income:-$2.25-$0.75-$1.07Liabilities:$6.57
EPS:-$0.33-$0.10Equity:$5.28

Note: Dollar amounts are in U.S. millions; Audited figures expressed as full year,
unaudited figures are partial year

Business Description
The company has created a new technology platform for the discovery and production of novel chemical compounds that have commercial potential. ArQule provides these compounds to members of the pharmaceutical and biotechnology industries. The company has developed a proprietary modular building block technology that it has integrated with structure-guided drug design, high speed parallel chemical synthesis and information technology to identify and optimize drug development candidates. To date, the company has entered into collaborative arrangements with Pharmacia Biotech AB, Abbott Laboratories and Solvay Duphar B.V., and has formed joint discovery programs with several biotechnology companies. ArQule believes that its technology will allow its collaborative partners to accelerate the drug discovery process by several years, permitting them to realize significant cost reductions and the earlier recovery of research and development expenditures for successful drugs.

Use of Proceeds
The proceeds from the offering will be used to fund research and product development programs and for working capital and for general corporate purposes.

Last updated: 12/22/96

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