IPOs IN REGISTRATION – Digimarc Corp. –

LAKE OSWEGO, Ore. – Digimarc Corp., a digital watermarking company, went public December 2, offering 4 million shares at $20 apiece. The company’s stock priced well above its $16 to $18 filing range.

Underwritten by BancBoston Robertson Stephens International, Hambrecht & Quist and U.S. Bancorp Piper Jaffray, the initial public offering left 12 million shares outstanding.

There were no selling shareholders. Venture backers included Macrovision Corp., Reuters Group PLC, SOFTBANK Corp., Adobe Systems Inc., AVI Capital Management LP, and Justsystem Corp.

The company’s invisible digital watermarks prevent the illegal reproduction and redistribution of goods and services such as data and video files, magazine ads, passports and other documents. Customers include National Geographic Society and Time Inc.

The $73.1 million in proceeds expected from the IPO will be used for additional working capital, debt repayment and to create a public market for the company’s common stock.

Digimarc has never been profitable, losing $4 million in 1997 and $3.4 million in 1998.

Brian Grossi, co-founder of AVI Capital, joined the company’s board of directors in July 1996. John Taysom, a managing director at Reuters, joined the board in December 1997.

Digimarc – Selected Financial

(in thousands, except per share data)

Jan. 3, 1995 (inception) Year Ended December 31 Nine Months Ended September 30

to December 31, 1995 1996 1997 1998 1998* 1999*

Total revenue 236 186 984 691 4,185

Net loss -874 -1,578 -3,979 -3,442 -2,321 -824

Net loss per share -1.01 -0.71 -1.88 -1.5 -1.02 -0.35