<PAGE>
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the Quarterly Period Ended January 31, 2000
Commission File Number: 0-21169
IMPERIAL PETROLEUM RECOVERY CORPORATION
--------------------------------------------------
(Exact Name of Issuer as Specified in its Charter)
NEVADA 76-0529110
- ------------------------------- ---------------------------------------
(State or Other Jurisdiction of (I.R.S. Employer Identification Number)
Incorporation or Organization)
2325-A Renaissance Drive, Las Vegas, Nevada 89119
--------------------------------------------------
(Address of Principal Executive Offices)
(702) 798-6800
----------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 [ ]
There were 16,094,478 shares of the Registrant's $.001 par value common stock
outstanding as of January 31, 2000.
<PAGE>
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION
PAGE
Item 1. Consolidated Financial Statements (Unaudited)
Consolidated Balance Sheets as of January 31,
2000 and October 31, 1999 3-4
Consolidated Statements of Operations for the
Three Months Ended January 31, 2000 and
January 31, 1999 5
Consolidated Statements of Cash Flows for the
Three Months Ended January 31, 2000 and 1999 6-7
Notes to Consolidated Financial Statements 8-11
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 12-14
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 14
Item 2. Changes in Securities and Use of Proceeds 14
Item 3. Defaults Upon Senior Securities 15
Item 4. Submission of Matters to a Vote of Security Holders 15
Item 5. Other Information 15
Item 6. Exhibits and Reports on Form 8-K 15
Signatures 15
Financial Data Schedule 16
2
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ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
IMPERIAL PETROLEUM RECOVERY CORPORATION AND SUBSIDIARY
(a development stage company)
CONSOLIDATED BALANCE SHEETS
ASSETS
January 31, October 31,
2000 1999
----------- -----------
(Unaudited) (Audited)
CURRENT ASSETS
Cash and cash equivalents $ 35,036 $ 17,774
Accounts Receivable 2,100 -
Inventory, net of reserve - -
Prepaid expenses 10,708 7,506
----------- -----------
Total current assets 47,844 25,280
PROPERTY AND EQUIPMENT, net of
Accumulated depreciation of $118,152
at January 31, 2000, and $93,963 at
October 31, 1999, respectively 579,406 527,099
OTHER ASSETS 40,716 41,262
----------- -----------
$ 667,966 $ 593,641
=========== ===========
(CONTINUED)
3
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IMPERIAL PETROLEUM RECOVERY CORPORATION AND SUBSIDIARY
(a development stage company)
CONSOLIDATED BALANCE SHEETS
(CONTINUED)
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Trade accounts payable $ 262,923 $ 270,745
Payables to related parties - 5,829
Accrued liabilities 77,716 115,959
Deferred revenue 25,893 15,764
Note Payable Related Party 60,000 -
Current maturities of long-term
obligations 50,033 50,033
----------- -----------
Total current liabilities 476,565 458,330
LONG-TERM OBLIGATIONS, less current
maturities 221,500 221,500
COMMITMENTS AND CONTINGENCIES - -
STOCKHOLDERS' DEFICIT
Common stock, par value $0.001;
authorized 100,000,000 shares; reserved
12,528,571; issued and outstanding
15,987,961 at January 31, 2000 and
15,901,597 at October 31, 1999,
respectively 15,988 15,902
Additional paid-in capital 10,060,897 9,910,983
Common stock subscriptions receivable (6,509) (6,509)
Deficit accumulated during the development
stage (10,100,475) (10,006,565)
----------- -----------
Total stockholders' deficit (30,099) (86,189)
----------- -----------
$ 667,966 $ 593,641
=========== ===========
The accompanying notes are an integral part of these statements.
4
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IMPERIAL PETROLEUM RECOVERY CORPORATION AND SUBSIDIARY
(a development stage company)
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended January 31, 2000 and 1999
(Unaudited)
2000 1999
----------- -----------
Revenues $ 94,177 $ 22,512
Cost of goods sold 15,870 48,263
----------- -----------
Gross profit (loss) 78,307 (25,751)
Operating expenses
General and administrative expenses 106,392 119,590
Research and development expenses prototype 58,853 62,261
----------- -----------
165,245 181,851
----------- -----------
Loss from operations (86,938) (207,602)
Other expense including interest, net (6,972) (9,193)
----------- -----------
NET LOSS $ (93,910) $ (216,795)
=========== ===========
Loss per common share-basic and diluted $ (0.01) $ (0.02)
=========== ===========
The accompanying notes are an integral part of these statements.
5
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IMPERIAL PETROLEUM RECOVERY CORPORATION AND SUBSIDIARY
(a development stage company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Three Months Ended January 31, 2000 and 1999
2000 1999
----------- -----------
Increase (decrease) in cash and cash
equivalents
Cash flows from operating activities
Net loss $ (93,910) $ (216,795)
Adjustments to reconcile net loss to
net cash used in operating activities
Depreciation and amortization 24,735 6,012
Changes in assets and liabilities
Accounts receivable (2,100) -
Prepaid expenses (3,202) 7,221
Other assets - (3,091)
Payables (13,651) 47,274
Accrued liabilities (38,243) 18,335
Deferred revenue 10,129 -
Accrued lease obligations - -
----------- -----------
Total adjustments (22,332) 75,751
----------- -----------
Net cash used in operating
activities (116,242) (141,044)
----------- -----------
Cash flows from investing activities
Cash paid for acquisition - -
Purchases of property and equipment (76,496) -
----------- -----------
Net cash used in investing
activities (76,496) -
----------- -----------
(CONTINUED)
6
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IMPERIAL PETROLEUM RECOVERY CORPORATION AND SUBSIDIARY
(a development stage company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Continued)
2000 1999
----------- -----------
Cash flows from financing activities
Proceeds from issuance of common stock
and warrants 150,000 150,000
Proceeds from loans from affiliated
entity 60,000 -
----------- -----------
Net cash provided by financing
activities 210,000 150,000
----------- -----------
Net increase (decrease) in cash and
cash equivalents 17,262 8,956
Cash and cash equivalents at beginning of
period 17,774 49,342
----------- -----------
Cash and cash equivalents at end of period $ 35,036 $ 58,298
=========== ===========
Supplemental disclosure of cash flow
information
Cash paid during the period for Interest $ 5,000 $ 5,000
=========== ===========
The accompanying notes are an integral part of these statements.
7
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IMPERIAL PETROLEUM RECOVERY CORPORATION AND SUBSIDIARY
(a development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
1. BASIS OF PRESENTATION
The consolidated financial statements have been prepared in conformity
with generally accepted accounting principles for interim financial
information and pursuant to the regulations of the Securities and Exchange
Commission; accordingly, they do not include all of the information and notes
required by generally accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments considered
necessary for a fair presentation (consisting of normal recurring accruals)
have been included. The results of operations for the three month period
ended January 31, 2000 are not necessarily indicative of the results for the
fiscal year ending October 31, 2000. The accompanying unaudited consolidated
financial statements should be read in conjunction with the financial
statements and notes thereto included in the Company's Annual Report on Form
10-KSB for the fiscal year ended October 31, 1999.
2. ORGANIZATION AND BUSINESS ACTIVITY
Imperial Petroleum Recovery Corporation and Subsidiary (a development
stage company incorporated in Nevada) (the "Company") has been in the
development stage since commencement of operations in fiscal year 1995 and is
committed to developing and marketing a proprietary oil sludge remediation
process and equipment (MST units) that uses high energy microwaves to separate
water, oil and solids. Company operations take place in Texas. The Company's
corporate offices are in Nevada.
3. PRINCIPLES OF CONSOLIDATION AND FINANCIAL STATEMENT PRESENTATION
During 1999, the Company created a wholly-owned subsidiary, Petrowave
Corporation, into which it transferred certain assets.
The consolidated financial statements include the accounts of the Company
and its wholly-owned subsidiary. Significant intercompany transactions and
balances have been eliminated in the consolidation.
4. USE OF ESTIMATES
In preparing financial statements in conformity with generally accepted
accounting principles, management is required to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities at the date of the financial
statements and revenue and expenses during the reporting period. Actual
results could differ from those estimates.
5. CASH AND CASH EQUIVALENTS
The Company considers all highly liquid investments, with original
maturity dates of three months or less when purchased, to be cash equivalents.
8
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IMPERIAL PETROLEUM RECOVERY CORPORATION AND SUBSIDIARY
(a development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
6. INVENTORIES
Inventory consists of components to be manufactured into the Company's
products. Inventory is valued at lower of cost or market. Cost is determined
using the first-in, first-out method. Management has recorded a reserve of
$260,000 against the value of inventory on hand. The recoverability of
inventory is dependent upon the Company entering into agreements to lease the
completed units.
7. OTHER ASSETS
Included in other assets are long-term deposits and patents. The cost of
patents is capitalized and amortized to operations over their estimated useful
lives or statutory lives whichever is shorter. Amortization is computed on
the straight-line method.
8. PROPERTY AND EQUIPMENT
Depreciation is provided for in amounts sufficient to relate the cost of
depreciable assets to operations over their estimated useful lives. The
straight-line method of depreciation is followed for furniture and fixtures,
machinery and equipment, and automobiles for financial reporting purposes.
Rental equipment is depreciated over ten years using a straight-line method.
9. RESEARCH AND DEVELOPMENT EXPENSES
Costs incurred in connection with developing a prototype and a
demonstration model of a crude oil sludge, recovery system have been expensed
as incurred.
10. ADVERTISING COSTS
Advertising costs are expensed in the period incurred.
11. REVENUE RECOGNITION
Revenue on contracts from crude oil sludge recovery services is accounted
for principally by the percentage-of-completion method whereby revenue is
recognized based on the estimated stage of completion of individual contracts.
Revenues on contracts from leased equipment is recognized according to
contract terms.
12. FAIR VALUE OF FINANCIAL INSTRUMENTS
Cash and cash equivalents, accounts payable and accrued liabilities are
reflected in the financial statements at fair value because of the short-term
maturity of these instruments. Notes payable to third parties and related
parties as reflected in the financial statements approximate their fair value.
9
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IMPERIAL PETROLEUM RECOVERY CORPORATION AND SUBSIDIARY
(a development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
13. INCOME TAXES
The Company utilizes the liability method of accounting for income taxes.
Under the liability method, deferred tax assets and liabilities are determined
based on the difference between the financial statement and tax bases of
assets and liabilities using enacted tax rates in effect during the years in
which the differences are expected to reverse. An allowance against deferred
tax assets is recorded in whole or in part when it is more likely than not
that such tax benefits will not be realized.
14. WARRANTS
In accordance with Statement of Financial Accounting Standards No. 123
(SFAS No. 123) "Accounting for Stock-Based Compensation," expense is
recognized in connection with the grant of warrants when issued using the
fair-market-value method. Pro forma adjusted net income calculated by
applying the fair value requirement for warrants issued for recognition of
expense is not included because there is no significant impact in application
of the standard.
15. LOSS PER COMMON SHARE
The Company has adopted Statement of Financial Accounting Standards No.
128, "Earnings per Share" (SFAS 128). SFAS 128 requires the disclosure of
Basic and Diluted Earnings per Share (EPS). Basic EPS is calculated using
income available to common stockholders divided by the weighted-average number
of common shares outstanding during the year. Diluted EPS is similar to Basic
EPS except that the weighted-average of common shares outstanding is increased
to include the number of additional common shares that would have been
outstanding if the dilutive potential common shares had been issued. Such
potentially dilutive common shares include stock warrants granted or sold and
convertible debt. Shares having an antidilutive effect on periods presented
are not included in the computation of dilutive EPS.
16. SEGMENT REPORTING
Statement of Financial Accounting Standards No. 131 (SFAS 131)
"Disclosures about Segments of an Enterprise and Related Information,"
requires that a public business enterprise report a measure of segment profit
or loss, certain specific revenue and expense items, and segment assets. Since
the Company is still considered a development stage company, no segments have
been identified by management.
17. CERTAIN RECLASSIFICATIONS
Certain reclassifications have been made to the 1999 financial statements
to conform to the 2000 presentation.
10
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IMPERIAL PETROLEUM RECOVERY CORPORATION AND SUBSIDIARY
(a development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE B - GOING CONCERN
The accompanying financial statements have been prepared in conformity
with generally accepted accounting principles, which contemplate continuation
of the Company as a going concern. However, the Company is a development
stage company, has generated limited revenue through January 2000, and has
sustained substantial losses from operations since inception. In addition, as
of January 31, 2000, its current liabilities exceeded its current assets by
$428,721 and it has a stockholders' deficit of $30,099. Also, the Company has
used cash in, rather than provided cash from, its operations.
In view of the matters described in the preceding paragraph,
recoverability of a major portion of the recorded asset amounts shown in the
accompanying balance sheet is dependent upon continued operations of the
Company, which in turn is dependent upon the Company's ability to meet its
financing requirements on a continuing basis, to maintain present financing
and to succeed in its future operations. The financial statements do not
include any adjustments relating to the recoverability and classification of
recorded asset amounts or amounts and classification of liabilities that might
be necessary should the Company be unable to continue in existence.
The Company has taken the following steps to revise its operating and
financial requirements which it believes are sufficient to provide the Company
with the ability to continue in existence:
* As of October 31, 1999, the Company had leased certain equipment
expiring through 2002.
* During fiscal year 1999, the Company entered into a 24-month Worldwide
Marketing Agreement with an oil company to provide the Company with
marketing and sales assistance. The two companies have agreed to
share certain of the revenue related to this agreement.
11
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
This portion of the Form 10-QSB contains "forward-looking statements"
within the meaning of the federal securities laws, including statements
concerning anticipated revenues, future marketing plans for the MST-1000, and
similar statements concerning anticipated future events and expectations that
are not historical facts. The forward-looking statements in this portion of
the Form 10-QSB are subject to numerous risks and uncertainties, including the
effects of economic conditions; the availability of capital; the dependence on
key customers; competitive conditions; and the various risks associated with
developing and marketing a new process/technology which could cause actual
results to differ materially from those expressed in or implied by the
statements herein. Due to such uncertainties and risks, readers are cautioned
not to place undue reliance on such forward-looking statements, which speak
only as of the date hereof. Readers should also refer to the Company's Annual
Report on Form 10-KSB for the fiscal ended October 31, 1999.
OVERVIEW
During the fourth quarter of 1999, worldwide oil prices rebounded from a
twenty-year low to reach high levels not seen since the 1990 Gulf War Period.
This dramatic rise in crude oil prices has prompted expanded interest in
Imperial Petroleum Recovery Corporation's (IPRC) Microwave Separation
Technology (MST) System. The MST System provides a low cost method to recover
oil from refinery waste streams, which results in increased refinery
production and storage tank capacity.
In May 1999, the Company executed a three-year lease of a MST-1000 with
the Torrance California facility of Mobil Oil Corporation. The first
commercially available MST Unit was delivered to the Torrance facility in
September 1999. Currently, this unit is operating 24 hours a day and is
successfully processing some of the most difficult crude streams received by
that facility.
In October 1999, the Company signed a worldwide marketing agreement with
Mobil Technology Company (MTC). As part of the agreement, MTC agreed to
utilize its expertise and extensive experience to market the MST System to the
global oil industry. Since signing the agreement, Management within both
companies has been busy developing and implementing detailed plans for the
joint effort.
During March 2000, the American Institute of Chemical Engineers (AIChE)
held its Spring National Meeting in Atlanta Georgia. A representative from
ExxonMobil Research and Engineering was one of the discussion group speakers
at this meeting. The ExxonMobil representative presented a paper entitled,
"The MST Microwave Separation Technology for Breaking Crude Oil Emulsions:
Overview and Case Study" which specifically discussed ExxonMobil's experience
with the MST-1000 Unit. This presentation was a significant marketing event
because meeting attendees included international representatives who were
specifically looking for solutions to desalter problems within the refinery
environment.
As part of the on-going, aggressive marketing effort, IPRC and ExxonMobil
have identified over 20 sites with an immediate need or interest in the MST
System. As discussions expand to a broader customer base, IPRC has determined
that the MST System has the potential to economically treat a wide range of
12
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crude oil emulsions in the upstream, downstream and chemical sectors.
Management believes these discussions will result in several new contracts.
When a potential customer requests a demonstration of the MST System,
IPRC has the capability to transport a demonstration unit to the customer's
place of operations. Currently, the Company has one demonstration unit in the
field. This existing unit is scheduled to return to Houston to be updated
with the latest technological advancements. The unit will, then, be deployed
to the various sites in the United States that have been identified by
ExxonMobil. Upon completion of those scheduled demonstrations, the unit will
be routed to several sites in Canada for further demonstrations.
The Company is scheduled to relocate its offices to a new facility
sometime in April or May 2000. The new facility will permit the Company to
collocate the administrative, laboratory and manufacturing functions under one
roof. The Company feels this relocation will result in lower costs, better
operational controls and greater efficiency.
During the first quarter 2000, the Company continued to improve its
testing facilities to meet the increased customer demand for sample testing.
In addition, the Company has expanded staff to deal with the increase in
activity. IPRC's Chairman, Henry Kartchner, recently moved his family to the
Houston area in order to lend strength and support to the staff and the
Company's daily operations. Management feels that the positive results of
fiscal 1999 will continue throughout fiscal 2000 as the MST System gains
acceptance within the petroleum industry.
RESULTS OF OPERATIONS
FIRST QUARTER ENDED JANUARY 31, 2000 COMPARED TO FIRST QUARTER ENDED JANUARY
31, 1999
REVENUE
During the three month period ended January 31, 2000, the Company
recognized $94,177 in revenue compared to $22,512 in 1999. The first quarter
2000 revenue is comprised of lease revenue earned from the Mobil lease at
Torrance California. During the first quarter 1999, the Company recognized
income of $22,512 from fees charged to reimburse set-up costs incurred by the
Company to demonstrate the MST-1000 at various locations.
COST OF GOODS SOLD AND GROSS PROFIT
During the three month period ended January 31, 2000, the Company
identified $15,870 in costs that were specifically identified to contract
revenue. The costs were comprised of incidental charges to set-up the
MST-1000 at the Torrance Mobil facility and depreciation of the leased
equipment. For the three month period ended January 31, 1999, the Company
incurred costs of $48,263 to transport and set-up the MST Demonstration Unit
at prospective customers' locations. The Company underestimated its
demonstration costs, which resulted in a negative gross profit for the first
quarter 1999. With this in mind, the Company revised the demonstration fee
schedule subsequent to the first quarter 1999.
13
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GENERAL AND ADMINISTRATIVE & RESEARCH AND DEVELOPMENT EXPENSES
General and administrative expenses for the three month period ended
January 31, 2000 totaled $106,392 compared to $119,590 for same period in
1999. The decrease in general and administrative costs was primarily due to a
decline in travel and lodging expense and a decrease in legal fees. Research
and development expenses, which totaled $58,853 for the first quarter 2000,
remained relatively constant when compared to a total of $62,261 for the three
month period ended January 31, 1999.
LIQUIDITY AND CAPITAL RESOURCES
IPRC's operations have been capital intensive. The Company has funded
operations principally from the private placement of equity securities,
primarily common stock, and warrants exercisable for common stock. As of
January 31, 2000, IPRC's aggregate current liabilities were approximately
$476,565 compared to $458,330 at October 31, 1999. At first quarter ended
January 31, 2000, the Company had negative working capital of $428,721
compared to negative working capital of $433,050 at October 31, 1999.
Management feels that it has identified sufficient funds to manufacture
the required MST Systems and has devised arrangements to introduce new,
related products, which it expects will increase revenues. The Company
anticipates steady growth in fiscal year 2000 as a result of an aggressive
marketing strategy and its continuing business relationships.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
On November 12, 1999, the Company issued 14,394 shares of Common Stock
plus 6,250 warrants at $0.20 per warrant to an investor for $25,000 in cash.
The warrants bear a strike price of $3.00 and expire on November 12, 2002.
On November 12, 1999, the Company issued 28,788 shares of Common Stock
plus 12,500 warrants at $0.20 per warrant to an investor for $50,000 in cash.
The warrants bear a strike price of $3.00 and expire on November 12, 2002.
On November 12, 1999, the Company issued 28,788 shares of Common Stock
plus 12,500 warrants at $0.20 per warrant to an investor for $50,000 in cash.
The warrants bear a strike price of $3.00 and expire on November 12, 2002.
On November 30, 1999, the Company issued 14,394 shares of Common Stock
plus 6,250 warrants at $0.20 per warrant to an investor for $25,000 in cash.
The warrants bear a strike price of $3.00 and expire on November 30, 2002.
The Company relied upon the exemption provided in Section 4(2) of the
Securities Act of 1933, which covers "transactions by an issuer not involving
any public offering," to issue the securities discussed in the previous
paragraph without registration under that Act. The Company made a
determination that the investors to whom the securities were issued did not
need the protections that registration would afford. The certificates
representing the shares of Common Stock issued and the Warrant were marked
with legends indicating that transfer of the securities is restricted because
they were not sold in a registered offering.
14
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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) EXHIBITS.
Exhibit
Number Description Location
27 Financial Data Schedule Filed herewith electronically
(b) REPORTS ON FORM 8-K. The Company did not file any reports on Form
8-K during the period covered by this report.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized, on
March 15, 2000.
IMPERIAL PETROLEUM RECOVERY CORPORATION
By:/s/ Henry H. Kartchner
Date: March 15, 2000 Henry H. Kartchner
Chairman and Chief Executive Officer
(Duly Authorized Officer and Principal
Executive Officer)
By:/s/ C. Brent Kartchner
Date: March 15, 2000 C. Brent Kartchner
President and Director
(Duly Authorized Officer and Principal
Financial Officer)
15
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated balance sheet and consolidated statement of operations in the
Company's Form 10-QSB as of and for the year to date and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-1999
<PERIOD-END> JAN-31-2000
<CASH> 35,036
<SECURITIES> 0
<RECEIVABLES> 2,100
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 47,844
<PP&E> 579,406
<DEPRECIATION> 24,189
<TOTAL-ASSETS> 667,966
<CURRENT-LIABILITIES> 476,565
<BONDS> 0
<COMMON> 15,988
0
0
<OTHER-SE> (46,087)
<TOTAL-LIABILITY-AND-EQUITY> 667,966
<SALES> 94,177
<TOTAL-REVENUES> 94,177
<CGS> 15,870
<TOTAL-COSTS> 165,245
<OTHER-EXPENSES> (6,972)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 8,310
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> (86,938)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (93,910)
<EPS-BASIC> (.01)
<EPS-DILUTED> (.01)
</TABLE>
