10-Q

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 September 30, 2016

¨ 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 CORPORATION

(Exact Name of Registrant as Specified on its Charter)

Delaware	13-3660391
(State of Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
767 Fifth Avenue, New York, New York	10153
(Address of Principal Executive Offices)	(Zip Code)
Registrant’s Telephone Number, Including Area Code	(212) 702-4300

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 x              No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes x              No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12-b-2 of the Exchange Act). (Check one):

Large accelerated filer ¨	Accelerated filer ¨
Non-accelerated filer ¨	Smaller reporting company x
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12-b-2 of the Exchange Act).

Yes ¨              No x

The number of shares of registrant’s common stock, $0.01 par value, outstanding as of October 31, 2016 was 26,288,080.

CADUS CORPORATION

INDEX

		Page No.
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS		3
PART I - CONDENSED CONSOLIDATED FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements	4
	Condensed Consolidated Balance Sheets – September 30, 2016 (Unaudited) and December 31, 2015	4
	Condensed Consolidated Statements of Operations - Three Months Ended September 30, 2016 and 2015 (Unaudited)	5
	Condensed Consolidated Statements of Operations - Nine Months Ended September 30, 2016 and 2015 (Unaudited)	6
	Condensed Consolidated Statements of Cash Flows - Nine Months Ended September 30, 2016 and 2015 (Unaudited)	7
	Notes to Condensed Consolidated Financial Statements (Unaudited)	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	13
Item 4.	Controls and Procedures	13
	PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	14
Item 1A.	Risk Factors	14
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	14
Item 3.	Defaults Upon Senior Securities	14
Item 4.	Mine Safety Disclosures	14
Item 5.	Other Information	14
Item 6.	Exhibits	14
SIGNATURES		15
EXHIBIT INDEX		16

2

SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

Certain statements in this Quarterly Report on Form 10-Q constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including any projections or expectations of earnings, revenue, financial performance, liquidity and capital resources or other financial items; any statement of our plans, strategies and objectives for our future operations; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumption underlying any of the foregoing. Forward-looking statements may include the words “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and other similar words. Although Cadus Corporation (the “Company”) believes that the expectations reflected in our forward-looking statements are reasonable, such forward-looking statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, risks and uncertainties relating to the Company’s ability to acquire residential homes or land for renovation or construction and resale, the Company’s ability to engage contractors to perform such renovation and construction, the Company’s ability to sell such renovated or new homes at a profit, the Company’s ability to acquire or invest in other businesses or assets, the Company’s capital needs and uncertainty of future funding, as well as other risks and uncertainties discussed in the Company’s annual report on Form 10-K for the year ended December 31, 2015. The forward-looking statements made in this Quarterly Report on Form 10-Q are made only as of the date hereof and the Company does not have or undertake any obligation to publicly update any forward-looking statements to reflect subsequent events or circumstances unless otherwise required by law.

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ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CADUS CORPORATION

Condensed Consolidated Balance Sheets

	September 30, 2016			December 31, 2015
	(Unaudited)
ASSETS
Assets:
Real estate inventory	$	34,554,796		$	32,716,718
Cash and cash equivalents		6,683,008			8,936,147
Interest receivable		1,859			542
Prepaid and other assets		51,414			38,548
Investment in other ventures		192,844			192,692
Website, net		15,000			20,000
Total assets	$	41,498,921		$	41,904,647
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Accrued expenses and other liabilities	$	399,076		$	325,216
Total liabilities		399,076			325,216
Commitments
Stockholders’ equity:
Common stock		264,297			264,297
Additional paid-in capital		80,291,992			80,291,992
Accumulated deficit		(39,156,369	)		(38,676,783	)
Treasury stock – at cost		(300,075	)		(300,075	)
Total stockholders’ equity		41,099,845			41,579,431
Total liabilities and stockholders’ equity	$	41,498,921		$	41,904,647

See accompanying notes to condensed consolidated financial statements.

4

CADUS CORPORATION

Condensed Consolidated Statements of Operations

	Three Months Ended September 30,
	2016			2015
	(Unaudited)			(Unaudited)
Total revenues	$	—		$	—
Costs and expenses:
General and administrative expenses		101,396			97,325
Real estate expenses		45,912			13,933
Amortization of website		1,667			—
Loss  (gain) from equity in other ventures		81			(8	)
Total costs and expenses		149,056			111,250
Operating loss		(149,056	)		(111,250	)
Other income:
Interest income		5,727			255
Loss before provision for income taxes		(143,329	)		(110,995	)
Provision for income taxes		—			(11,955	)
Net loss	$	(143,329	)	$	(99,040	)
Basic and diluted net (loss) per weighted average share of common stock outstanding	$	(0.01	)	$	(0.00	)
Weighted average shares of common stock outstanding – basic and diluted		26,288,080			26,288,080

See accompanying notes to condensed consolidated financial statements.

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CADUS CORPORATION

Condensed Consolidated Statements of Operations

	Nine Months Ended September 30,
	2016			2015
	(Unaudited)			(Unaudited)
Total revenues	$	—		$	—
Costs and expenses:
General and administrative expenses		385,266			422,230
Real estate expenses		103,699			45,628
Amortization of website		5,000			—
(Gain) loss from equity in other ventures		(152	)		431
Total costs and expenses		493,813			468,289
Operating loss		(493,813	)		(468,289	)
Other income:
Interest income		14,227			1,203
Loss before provision for income taxes		(479,586	)		(467,086	)
Provision for income taxes		—			(11,955	)
Net loss	$	(479,586	)	$	(455,131	)
Basic and diluted net (loss) per weighted average share of common stock outstanding	$	(0.02	)	$	(0.02	)
Weighted average shares of common stock outstanding – basic and diluted		26,288,080			26,288,080

See accompanying notes to condensed consolidated financial statements.

6

CADUS CORPORATION

Condensed Consolidated Statements of Cash Flows

	Nine Months Ended September 30,
	2016			2015
	(Unaudited)			(Unaudited)
Cash flows from operating activities:
Net loss	$	(479,586	)	$	(455,131	)
Adjustments to reconcile net (loss) to net cash (used in) operating activities:
Amortization of website		5,000			—
(Gain) loss from equity in other ventures		(152	)		431
Changes in assets and liabilities:
Increase in prepaid and other assets		(14,183	)		(69,418	)
Increase in real estate inventory		(1,838,078	)		(1,801,146	)
Increase in accrued expenses and other liabilities		73,860			238,001
Net cash used in operating activities		(2,253,139	)		(2,087,263	)
Net decrease in cash and cash equivalents		(2,253,139	)		(2,087,263	)
Cash and cash equivalents - beginning of period		8,936,147			11,877,951
Cash and cash equivalents - end of period	$	6,683,008		$	9,790,688

See accompanying notes to condensed consolidated financial statements.

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CADUS CORPORATION

Notes to Condensed Consolidated Financial Statements (Unaudited)

Note - 1 Organization and Basis of Preparation

The information presented as of September 30, 2016 and for the three and nine 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 accounting principles generally accepted in the United States of America 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, 2015 condensed consolidated balance sheet was derived from audited consolidated financial statements. These financial statements should be read in conjunction with the Company’s annual report on Form 10-K for the year ended December 31, 2015.

The consolidated financial statements include the accounts of Cadus and its wholly owned subsidiaries, Cadus Technologies, Inc., Blivet LLC, MB 2013 LLC and Happy Dragon LLC. All intercompany balances and transactions have been eliminated in consolidation. The Company operates in one segment: the purchase of homes and land for purposes of renovation or construction and resale. The Company has decided not to maintain its drug discovery technologies.

The results of operations for the three and nine month periods ended September 30, 2016 are not necessarily indicative of the results to be expected for the year ending December 31, 2016.

Note - 2 Cash Equivalents

The Company includes as cash equivalents all highly liquid investments with original maturities of three months or less when purchased to be cash equivalents. There were cash equivalents of $6,414,496 at September 30, 2016 and there were cash equivalents of $8,701,601 at December 31, 2015.

Note - 3 Net (Loss) Per Share

Basic net (loss) per share is computed by dividing the net (loss) by the weighted average of common shares outstanding. Diluted earnings per share is calculated based on the weighted average of common shares outstanding plus the effect of common stock equivalents (stock options). There were no outstanding stock options for the three and nine month periods ended September 30, 2016 and 2015.

Note - 4 Fair Value of Financial Instruments

The Company uses financial instruments in the normal course of its business. The carrying values of cash and cash equivalents and accrued expenses approximate fair value. The fair value of the Company’s investment in a privately held company is not readily available. The

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CADUS CORPORATION

Notes to Condensed Consolidated Financial Statements (Unaudited)

Note - 4 Fair Value of Financial Instruments (Continued)

Company believes the fair value of this investment in a privately held company approximated its carrying value at September 30, 2016 and December 31, 2015.

Note - 5 Real Estate Operations

In connection with the Company’s program to purchase residential properties for purposes of renovation or construction and resale, as of September 30, 2016, the Company had purchased for an aggregate original price of approximately $29.9 million, and continued to own, through two indirect wholly-owned subsidiaries, twelve residential properties in Miami-Dade County, Florida and one residential property in East Hampton, New York.

The company incurred $103,699 in real estate expenses for the nine months ended September 30, 2016, and $45,628 for the nine months ended September 30, 2015, consisting of utilities, maintenance, insurance, taxes and other operating costs and expenses with respect to properties owned.

Real estate inventory is recorded at cost. The cost of residential property includes the purchase price of the property, legal fees and other acquisition costs (e.g. recording, title search, survey, lien and permit searches, and inspection costs). Costs directly related to planning, developing and constructing a property are capitalized and classified as real estate inventory in the consolidated balance sheets. Capitalized development costs include interest, property taxes, insurance, and other direct project costs incurred during the period of development.

After acquisition, real estate inventory is analyzed periodically for changes in fair values and any subsequent write down is charged to operating expenses. The Company did not have such a write down during the nine months ended September 30, 2016 and 2015.

Note - 6 Accrued Expenses

Accrued expenses consist of the following:

	September 30, 2016		December 31, 2015
Real estate taxes	$	325,599	$	—
Real estate costs		67,320		283,383
Legal		—		17,035
Accounting		—		6,065
Property expenses		6,020		16,853
Stockholder relations		—		1,250
Sundry		137		630
	$	399,076	$	325,216

Note - 7 Recently Issued Accounting Standards

Recent accounting pronouncements issued by the FASB did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements.

9

CADUS CORPORATION

Notes to Condensed Consolidated Financial Statements (Unaudited)

Note - 8 Subsequent Events

The Company has evaluated the impact of events occurring after September 30, 2016 up to the date of issuance of these consolidated interim financial statements for adjustment or disclosure.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

The Company seeks opportunities to profit from the purchase of individual homes or individual residential lots for purposes of renovation or construction and resale. The Company has completed renovation of two homes - one located at 3506 Main Lodge Road, Coconut Grove, FL, and the other located at 3437 N. Moorings Way, Coconut Grove, FL. The Company has started construction of a new home on its vacant lot located at 2535 Shelter Avenue, Miami Beach, FL 33140 and has obtained permits for construction of a new home at each of the following of its properties: (i) 700 88th Street, Surfside, FL 33154, (ii) 2555 Shelter Avenue, Miami Beach, FL 33140 and (iii) 241 Atlantic Isle, Sunny Isles Beach, FL 33160. In addition to its real estate activities, the Company may consider acquisitions or investments in other industries.

At September 30, 2016, the Company had an accumulated deficit of approximately $39.2 million. The Company’s losses have resulted principally from costs incurred in connection with its prior biomedical research and development activities 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 generate revenues in the future only if it is able to profit from its real estate operations.

Results of Operations

Three Months Ended September 30, 2016 and 2015.

Revenues

There were no revenues for the three months ended September 30, 2016 and for the three months ended September 30, 2015.

Costs and Expenses

General and administrative expenses increased to $101,396 for the three months ended September 30, 2016 from $97,325 for the same period in 2015. Professional and consulting fees decreased by $7,515. Rent decreased by $3,150 due to the Company no longer leasing storage space. In 2015, when the Company terminated a patent license, the accrued amount payable by the Company for such license was reduced by $12,500. There were other net increases of $2,236.

Real estate expenses for the three months ended September 30, 2016 were $45,912 consisting of maintenance and utilities for properties owned. Real estate expenses for the three months ended September 30, 2015 were $13,933. The expenses for the three months ended September 30, 2016 include real estate taxes and insurance on the completely renovated property.

For the three months ended September 30, 2016 and 2015, the Company recognized a loss of $81 and a gain of $8, respectively, in its investment in Laurel Partners Limited Partnership.

Interest Income

Interest income for the three months ended September 30, 2016 was $5,727 compared to interest income of $255 for the same period in 2015. This increase is attributable primarily to an increase in interest rates.

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Results of Operations (continued)

Net (Loss)

Net loss for the three months ended September 30, 2016 was $143,329 compared to a net loss of $99,040 for the same period in 2015. The increase in net loss can be principally attributed to an increase in general and administrative expenses of $4,071, an increase in real estate expenses of $31,979, an increase in amortization of website of $1,667, an increase in provision for income taxes $11,955, and a decrease in gain from other ventures of $89, offset by an increase in interest income of $5,472.

Nine Months Ended September 30, 2016 and 2015.

Revenues

There were no revenues for the nine months ended September 30, 2016 and for the nine months ended September 30, 2015.

Costs and Expenses

General and administrative expenses decreased to $385,266 for the nine months ended September 30, 2016 from $422,230 for the same period in 2015. Professional and consulting fees decreased by $22,730. Patent costs and license fees decreased by $16,272 due to the Company no longer maintaining its drug discovery technologies. Rent decreased by $7,350 due to the Company no longer leasing storage space. In connection with closing of the storage facility, the Company paid $6,266 for the shredding and transferring of records. There were other net increases of $3,122.

Real estate expenses for the nine months ended September 30, 2016 were $103,699 consisting of maintenance and utilities for properties owned. Real estate expenses for the nine months ended September 30, 2015 were $45,628. The expenses for the nine months ended September 30, 2016 include real estate taxes and insurance on the completely renovated property.

For the nine months ended September 30, 2016 and 2015, the Company recognized a gain of $152 and a loss of $431, respectively, in its investment in Laurel Partners Limited Partnership.

12

Results of Operations (continued)

Interest Income

Interest income for the nine months ended September 30, 2016 was $14,227 compared to interest income of $1,203 for the same period in 2015. This increase is attributable primarily to an increase in interest rates.

Net (Loss)

Net loss for the nine months ended September 30, 2016 was $479,586 compared to a net loss of $455,131 for the same period in 2015. The increase in net loss can be attributed to an increase in real estate expenses of $58,071, an increase in amortization of website of $5,000 and an increase in provision for income taxes of $11,955, offset by a decrease in general and administrative expenses of $36,964, an increase in gain from equity in other ventures of $583 and an increase in interest income of $13,024.

Liquidity and Capital Resources

At September 30, 2016, the Company held cash and cash equivalents of $6.7 million.

Depending on the availability of transactions acceptable to the Company in connection with its real estate activities, all or a portion of the Company’s available cash may be utilized, and the Company may seek debt or additional equity financing. The Company’s capital requirements may vary as a result of a number of factors, including the transactions, if any, arising from the Company’s efforts to acquire, renovate, construct and sell residential properties. There can be no assurance that the Company will raise sufficient capital on a timely basis or on satisfactory terms or at all to meet such capital requirements.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Under SEC regulations, the Company is considered a smaller reporting company and is not required to provide the information under this item.

Item 4. CONTROLS AND PROCEDURES

Based on the evaluation of the Company’s disclosure controls and procedures conducted as of the end of the period covered by this report on Form 10-Q, the Company’s President and Chief Executive Officer and the Company’s Treasurer (who performs functions similar to those of a principal financial officer), concluded that the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934) are effective. In addition, there has been no change in the Company’s internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934) that occurred during the period covered by this report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting. It should be noted that any system of controls, however well designed and operated, can provide only reasonable assurance, and not absolute assurance, that the objectives of the system are met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events. Because of these and other inherent limitations of control systems, there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

13

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

There were no material changes from the risk factors previously disclosed in our Annual Report on Form 10-K for the period ended December 31, 2015 as filed with the Securities and Exchange Commission on March 30, 2016.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. MINE SAFETY DISCLOSURES.

Not applicable.

Item 5. Other Information.

The Company’s Board of Directors has fixed Wednesday, May 24, 2017, as the date of the 2017 Annual Meeting of Stockholders of the Company and the close of business on April 6, 2017 as the record date for the determination of stockholders entitled to notice of and to vote at the meeting and at any and all adjournments thereof. Stockholders who wish to present proposals at the annual meeting of stockholders and who wish to have their proposals presented in the proxy statement distributed by the Board of Directors in connection with such annual meeting must submit their proposals in writing, to the attention of the President of the Company, on or before December 13, 2016.

Item 6. Exhibits.

The Exhibits listed in the Exhibit Index are included in this quarterly report on Form 10-Q.

14

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 CORPORATION
	(Registrant)
Dated: November 14, 2016	By:	/s/ Hunter C. Gary
		Hunter C. Gary President and Chief Executive Officer
Dated: November 14, 2016	By:	/s/ David Blitz
		David Blitz Treasurer and Secretary

15

EXHIBIT INDEX

The following exhibits are filed as part of this Quarterly Report on Form 10-Q:

Exhibit No. Description

31.1 Certification of Chief Executive Officer pursuant to Rules 13a-14 and 15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2 Certification of Chief Financial Officer pursuant to Rules 13a-14 and 15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1 Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2 Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS XBRL Instance Document

101.SCH XBRL Taxonomy Extension Schema

101.CAL XBRL Taxonomy Extension Calculation Linkbase

101.DEF XBRL Taxonomy Extension Definition Linkbase

101.LAB XBRL Taxonomy Extension Label Linkbase

101.PRE XBRL Taxonomy Extension Presentation Linkbase

16

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Hunter C. Gary, President and Chief Executive Officer of Cadus Corporation, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Cadus Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonable likely to adversely affect the registrant’s ability to record, process, summarize and report financial data information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 14, 2016
	/s/ Hunter C. Gary
	Hunter C. Gary President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, David Blitz, Treasurer and Secretary of Cadus Corporation, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Cadus Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonable likely to adversely affect the registrant’s ability to record, process, summarize and report financial data information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 14, 2016
	/s/ David Blitz
	David Blitz Treasurer and Secretary (Chief Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Cadus Corporation (the “Company”) on Form 10-Q for the nine months ended September 30, 2016 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Hunter Gray, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

A signed original of this written statement required by Section 906 has been provided to Cadus Corporation and will be retained by Cadus Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

/s/ Hunter C. Gary

Hunter C. Gary

President and Chief Executive Officer

Date: November 14, 2016

The foregoing certification is furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Cadus Corporation (the “Company”) on Form 10-Q for the nine months ended September 30, 2016 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, David Blitz, Secretary and Treasurer (Chief Financial Officer) of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

A signed original of this written statement required by Section 906 has been provided to Cadus Corporation and will be retained by Cadus Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

/s/ David Blitz

David Blitz

Secretary and Treasurer (Chief Financial Officer)

Date: November 14, 2016

The foregoing certification is furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document.

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Document And Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Oct. 31, 2016
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q3
Entity Registrant Name	CADUS CORP
Entity Central Index Key	0000911148
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Trading Symbol	KDUS
Entity Common Stock, Shares Outstanding		26,288,080

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Condensed Consolidated Balance Sheets - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Assets:
Real estate inventory	$ 34,554,796	$ 32,716,718
Cash and cash equivalents	6,683,008	8,936,147
Interest receivable	1,859	542
Prepaid and other assets	51,414	38,548
Investment in other ventures	192,844	192,692
Website, net	15,000	20,000
Total assets	41,498,921	41,904,647
Liabilities:
Accrued expenses and other liabilities	399,076	325,216
Total liabilities	399,076	325,216
Commitments
Stockholders’ equity:
Common stock	264,297	264,297
Additional paid-in capital	80,291,992	80,291,992
Accumulated deficit	(39,156,369)	(38,676,783)
Treasury stock - at cost	(300,075)	(300,075)
Total stockholders’ equity	41,099,845	41,579,431
Total liabilities and stockholders’ equity	$ 41,498,921	$ 41,904,647

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Condensed Consolidated Statements of Operations - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Total revenues	$ 0	$ 0	$ 0	$ 0
Costs and expenses:
General and administrative expenses	101,396	97,325	385,266	422,230
Real estate expenses	45,912	13,933	103,699	45,628
Amortization of website	1,667	0	5,000	0
(Gain) loss from equity in other ventures	81	(8)	(152)	431
Total costs and expenses	149,056	111,250	493,813	468,289
Operating loss	(149,056)	(111,250)	(493,813)	(468,289)
Other income:
Interest income	5,727	255	14,227	1,203
Loss before provision for income taxes	(143,329)	(110,995)	(479,586)	(467,086)
Provision for income taxes	0	(11,955)	0	(11,955)
Net loss	$ (143,329)	$ (99,040)	$ (479,586)	$ (455,131)
Basic and diluted net (loss) per weighted average share of common stock outstanding	$ (0.01)	$ (0.00)	$ (0.02)	$ (0.02)
Weighted average shares of common stock outstanding - basic and diluted	26,288,080	26,288,080	26,288,080	26,288,080

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Condensed Consolidated Statements of Cash Flows - USD ($)	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flows from operating activities:
Net loss	$ (479,586)	$ (455,131)
Adjustments to reconcile net (loss) to net cash (used in) operating activities:
Amortization of website	5,000	0
(Gain) loss from equity in other ventures	(152)	431
Changes in assets and liabilities:
Increase in prepaid and other assets	(14,183)	(69,418)
Increase in real estate inventory	(1,838,078)	(1,801,146)
Increase in accrued expenses and other liabilities	73,860	238,001
Net cash used in operating activities	(2,253,139)	(2,087,263)
Financing activities
Net decrease in cash and cash equivalents	(2,253,139)	(2,087,263)
Cash and cash equivalents - beginning of period	8,936,147	11,877,951
Cash and cash equivalents - end of period	$ 6,683,008	$ 9,790,688

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Organization and Basis of Preparation

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block]

Note - 1 Organization and Basis of Preparation

The information presented as of September 30, 2016 and for the three and nine 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 accounting principles generally accepted in the United States of America 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, 2015 condensed consolidated balance sheet was derived from audited consolidated financial statements. These financial statements should be read in conjunction with the Company's annual report on Form 10-K for the year ended December 31, 2015.

The consolidated financial statements include the accounts of Cadus and its wholly owned subsidiaries, Cadus Technologies, Inc., Blivet LLC, MB 2013 LLC and Happy Dragon LLC. All intercompany balances and transactions have been eliminated in consolidation. The Company operates in one segment: the purchase of homes and land for purposes of renovation or construction and resale. The Company has decided not to maintain its drug discovery technologies.

The results of operations for the three and nine month periods ended September 30, 2016 are not necessarily indicative of the results to be expected for the year ending December 31, 2016.

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Cash Equivalents

9 Months Ended

Sep. 30, 2016

Cash and Cash Equivalents [Abstract]

Cash and Cash Equivalents Disclosure [Text Block]

Note - 2 Cash Equivalents

The Company includes as cash equivalents all highly liquid investments with original maturities of three months or less when purchased to be cash equivalents. There were cash equivalents of $6,414,496 at September 30, 2016 and there were cash equivalents of $8,701,601 at December 31, 2015.

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Net (Loss) Per Share

9 Months Ended

Sep. 30, 2016

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

Note - 3 Net (Loss) Per Share

Basic net (loss) per share is computed by dividing the net (loss) by the weighted average of common shares outstanding. Diluted earnings per share is calculated based on the weighted average of common shares outstanding plus the effect of common stock equivalents (stock options). There were no outstanding stock options for the three and nine month periods ended September 30, 2016 and 2015.

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Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2016

Fair Value Disclosures [Abstract]

Fair Value Disclosures [Text Block]

Note - 4 Fair Value of Financial Instruments

The Company uses financial instruments in the normal course of its business. The carrying values of cash and cash equivalents and accrued expenses approximate fair value. The fair value of the Company’s investment in a privately held company is not readily available. The

Company believes the fair value of this investment in a privately held company approximated its carrying value at September 30, 2016 and December 31, 2015.

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Real Estate Operations

9 Months Ended

Sep. 30, 2016

Real Estate [Abstract]

Real Estate Disclosure [Text Block]

Note - 5 Real Estate Operations

In connection with the Company’s program to purchase residential properties for purposes of renovation or construction and resale, as of September 30, 2016, the Company had purchased for an aggregate original price of approximately $29.9 million, and continued to own, through two indirect wholly-owned subsidiaries, twelve residential properties in Miami-Dade County, Florida and one residential property in East Hampton, New York.

The company incurred $103,699 in real estate expenses for the nine months ended September 30, 2016, and $45,628 for the nine months ended September 30, 2015, consisting of utilities, maintenance, insurance, taxes and other operating costs and expenses with respect to properties owned.

Real estate inventory is recorded at cost. The cost of residential property includes the purchase price of the property, legal fees and other acquisition costs (e.g. recording, title search, survey, lien and permit searches, and inspection costs). Costs directly related to planning, developing and constructing a property are capitalized and classified as real estate inventory in the consolidated balance sheets. Capitalized development costs include interest, property taxes, insurance, and other direct project costs incurred during the period of development.

After acquisition, real estate inventory is analyzed periodically for changes in fair values and any subsequent write down is charged to operating expenses. The Company did not have such a write down during the nine months ended September 30, 2016 and 2015.

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Accrued Expenses

9 Months Ended

Sep. 30, 2016

Payables and Accruals [Abstract]

Accounts Payable, Accrued Liabilities, and Other Liabilities Disclosure, Current [Text Block]

Note - 6 Accrued Expenses

Accrued expenses consist of the following:

	September 30, 2016		December 31, 2015
Real estate taxes	$	325,599	$	—
Real estate costs		67,320		283,383
Legal		—		17,035
Accounting		—		6,065
Property expenses		6,020		16,853
Stockholder relations		—		1,250
Sundry		137		630
	$	399,076	$	325,216

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Recently Issued Accounting Standards

9 Months Ended

Sep. 30, 2016

Accounting Changes and Error Corrections [Abstract]

Accounting Changes and Error Corrections [Text Block]

Note - 7 Recently Issued Accounting Standards

Recent accounting pronouncements issued by the FASB did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements.

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Subsequent Events

9 Months Ended

Sep. 30, 2016

Subsequent Events [Abstract]

Subsequent Events [Text Block]

Note - 8 Subsequent Events

The Company has evaluated the impact of events occurring after September 30, 2016 up to the date of issuance of these consolidated interim financial statements for adjustment or disclosure.

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Accrued Expenses (Tables)

9 Months Ended

Sep. 30, 2016

Payables and Accruals [Abstract]

Schedule of Accrued Liabilities [Table Text Block]

Accrued expenses consist of the following:

	September 30, 2016		December 31, 2015
Real estate taxes	$	325,599	$	—
Real estate costs		67,320		283,383
Legal		—		17,035
Accounting		—		6,065
Property expenses		6,020		16,853
Stockholder relations		—		1,250
Sundry		137		630
	$	399,076	$	325,216

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Cash Equivalents (Details Textual) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Cash and Cash Equivalents [Line Items]
Cash Equivalents, at Carrying Value	$ 6,414,496	$ 8,701,601

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Real Estate Operations (Details Textual) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Real Estate Properties [Line Items]
Real Estate Expense	$ 45,912	$ 13,933	$ 103,699	$ 45,628
Property In Miami-Dade Country [Member]
Real Estate Properties [Line Items]
Real Estate Investment Property, at Cost, Total	$ 29,900,000		$ 29,900,000

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Accrued Expenses (Details) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Accrued Expenses and Other Current Liabilities [Line Items]
Real estate taxes	$ 325,599	$ 0
Real estate costs	67,320	283,383
Legal	0	17,035
Accounting	0	6,065
Property expenses	6,020	16,853
Stockholder relations	0	1,250
Sundry	137	630
Accrued Expenses	$ 399,076	$ 325,216