<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
Quarter Report Pursuant To Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended June 30, 1999 Commission File Number 0-22919
PRIME COMPANIES, INC.
(Exact name of registrant as specified in charter)
DELAWARE 52-2031531
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
155 MONTGOMERY STREET, SUITE 406, SAN FRANCISCO, CALIFORNIA 94104
(Address of principal executive offices) (Zip Code)
(415) 398-4242
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last
report)
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 requires for the past 90 days. Yes___ No X___
The number of shares of common stock outstanding as of July 31, 1999 was
6,557,652
1
<PAGE>
PRIME COMPANIES, INC.
AND CONSOLIDATED SUBSIDIARY COMPANIES
INDEX
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION PAGE
- ------------------------------ ----
<S> <C>
Item 1. Financial Statements:
Condensed Consolidated Balance Sheets--June 30, 1999
and December 31, 1998 3
Condensed Consolidated Statements of Operations--Three
and Six Months Ended June 30, 1999 and 1998 5
Condensed Consolidated Statements of Cash Flows--Six
Months Ended June 30, 1999 and 1998 7
Notes to Condensed Consolidated Financial Statements 9
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 11
PART II - OTHER INFORMATION
- ------------------------------
Item 1. Legal Information 14
Item 5. Other Information 14
Item 14. Exhibits and Reports on Form 8-K 14
Signatures 15
</TABLE>
2
<PAGE>
PRIME COMPANIES, INC.
AND CONSOLIDATED SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998*
-------------------- -------------------
(Unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 60,314 8,828
Investments held in escrow 1,800,000 1,800,000
Deposits and other current assets 1,018 10,618
Property held for sale 853,324 853,324
Net assets of discontinued operations 318,514 1,372,463
------------------ ------------------
TOTAL ASSETS $ 3,033,170 $ 4,045,233
================== ==================
</TABLE>
* Condensed from audited financial statements.
Continued
3
<PAGE>
PRIME COMPANIES, INC.
AND CONSOLIDATED SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998*
------------------ ------------------
(Unaudited)
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable $ 41,306 290,269
Note payable to related party 731,306 731,306
Accounts payable and accrued liabilities 1,538,667 2,069,222
------------------ ------------------
TOTAL CURRENT LIABILITIES 2,311,279 3,090,797
Note Payable to Related Parties 931,694 957,000
------------------ ------------------
TOTAL LIABILITIES 3,242,973 4,,047,797
------------------ ------------------
STOCKHOLDERS' EQUITY (DEFICIT):
Preferred stock, $.0001 par value, 10,000,000 shares authorized,
None issued and outstanding
Common stock, shares authorized 50,000,000, par value$.0001, 6,557,652 and
5,807,552 shares were issued and outstanding
at June 30, 1999 and December 31, 1998, respectively 701 581
Additional paid-in capital 8,253,034 7,945,116
Retained deficit (8,463,538) (7,946,261)
------------------- -------------------
Total stockholders' equity (deficit) (209,803) (2,564)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 3,033,170 $ 4,045,233
================== ==================
</TABLE>
* Condensed from audited financial statements.
The accompanying notes are an integral part of these condensed
consolidated financial statements.
4
<PAGE>
PRIME COMPANIES, INC.
AND CONSOLIDATED SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------------------------- -----------------------------------
1999 1998 1999 1998
------------------ ---------------- --------------- ---------------
<S> <C> <C> <C> <C>
GENERAL AND ADMINISTRATIVE EXPENSE $ 384,180 $ 126,526 $ 504,822 $ 247,583
------------------ --------------- --------------- ---------------
OTHER INCOME (EXPENSE):
Investment income -- 103 -- 630,256
Interest income -- 10,395 -- 14,695
Rental income 19,200 28,800 48,000 57,600
Other income -- 241 -- 3,309
Interest expense (28,625) -- (57,250) --
------------------- --------------- ---------------- ---------------
NET INCOME (LOSS) FROM CONTINUING OPERATIONS
BEFORE PROVISION FOR COME TAXES (393,605) (86,987) (514,072) 458,277
PROVISION FOR INCOME TAX -- -- 1,205 --
------------------ --------------- --------------- ---------------
NET INCOME (LOSS) FROM CONTINUING OPERATIONS (393,605) (86,987) (515,277) 458,277
LOSS FROM DISCONTINUED OPERATIONS:
Loss from operations of transportation
Segment, net of applicable income taxes of
$0 and $1,241 for the six months ended
June 30, 1998 -- (687,042) -- (1,301,397)
------------------ ---------------- --------------- ---------------
NET (LOSS) $ (393,605) $ (784,029) $ (515,277) $ (843,120)
------------------- ---------------- ---------------- ---------------
</TABLE>
Continued
5
<PAGE>
PRIME COMPANIES, INC.
AND CONSOLIDATED SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------------------------- -----------------------------------
1999 1998 1999 1998
------------------ ---------------- --------------- ---------------
<S> <C> <C> <C> <C>
BASIC AND DILUTED PER SHARE INFORMATION:
Income (loss) from continuing operations $ (.06) $ (.02) $ (.08) $ .12
Loss from discontinued operations -- (.18) -- (.34)
------------------ ---------------- --------------- ---------------
Net (loss) $ (.06) $ (.20) $ (.08) $ (.22)
================== ================ =============== ===============
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING 6,557,652 3,859,788 6,500,000 3,851,788
================== ================ =============== ===============
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
6
<PAGE>
PRIME COMPANIES, INC.
AND CONSOLIDATED SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
--------------------------------------------
1999 1998
--------------------- -------------------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) from continuing operations $ (515,277) $ 458,277
Adjustments to reconcile net income (loss) from
continuing operations to net cash provided by
operating activities from continuing operations:
Stock issued for services 308,038 51,000
Changes in operating assets and liabilities:
Trading securities -- 146,224
Other current assets 9,600 470
Deferred Income -- (605,000)
Accounts payable and accrued liabilities 155,545 32,573
------------------ ------------------
Net cash provided by (used in) operating activities
from continuing operations (42,094) 83,544
------------------- ------------------
(Loss) from operations of discontinued transportation segment -- (1,301,397)
Adjustments to reconcile loss from operations of
discontinued transportation segment to net cash
used in operating activities of discontinued segment:
Depreciation -- 409,443
Gain (loss) on disposition of assets 300 (9,503)
Provision for bad debts 65,170 13,487
(Increase) decrease in operating assets:
Accounts receivable 831,396 9,081
Driver advance (60,519) (73,021)
Inventories -- 5,324
Investments -- --
Prepaid expenses 115,204 54,034
Deposits -- (140)
Increase (decrease) in:
Accounts payable and accrued liabilities (695,703) 480,805
Deferred expense credit -- (18,750)
------------------ -------------------
Net cash used in operating activities of
discontinued segment 255,848 (430,637)
------------------ -------------------
</TABLE>
Continued
7
<PAGE>
PRIME COMPANIES, INC.
AND CONSOLIDATED SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In Thousands)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
------------------------------------------
1999 1998
-------------------- -------------------
<S> <C> <C>
Cash flows from investing activities:
Purchases of property and equipment $ -- $ (54,000)
Proceeds from assets held for sale 3,070 23,000
Proceeds from sale of equipment -- 114,000
Collections on notes receivable -- 414,000
------------------ ------------------
Net cash provided by investing activities 3,070 497,000
------------------ ------------------
Cash flows from financing activities:
Proceeds from short-term debt $ 16,000 $ 200,000
Proceeds from long term debt -- 560,000
Principal payments on long-term debt --- (559,000)
Principal payments on loan payable (181,338) (109,000)
Margin account payable -- (308,000)
------------------ -------------------
Net cash (used in) financing activities (165,338) (216,000)
------------------- -------------------
Increase (decrease) in cash and cash equivalents 51,486 (66,093)
Cash and cash equivalents, beginning of period 8,828 200,569
------------------ ------------------
Cash and cash equivalents, end of period $ 60,314 $ 134,476
================== ==================
Supplemental disclosure of non-cash transactions:
Cash paid for:
Interest $ 57,250 $ 261,000
================== ==================
Income Taxes $ 1,205 $ 7,000
================== ==================
Noncash investing and financing transactions:
Purchase of property and equipment with debt $ -- $ 716,000
================== ==================
Decrease in asset held for sale with reduction in debt $ 108,930 $ --
================== ==================
Decrease of property and equipment with reduction
in additional paid-in capital $ -- $ 308,000
================== ==================
The accompanying notes are an integral part of these condensed
consolidated financial statements.
8
<PAGE>
Increase in note receivable in exchange for debt $ -- $ 257,000
================== ==================
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
9
<PAGE>
PRIME COMPANIES, INC.
AND CONSOLIDATED SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies followed by the Company are set forth in Note 1 to
the Company's consolidated financial statements included in the Company's
Annual Report to Stockholders for the year ended December 31, 1997.
2. STATEMENT OF INFORMATION FURNISHED
The condensed consolidated balance sheet as of June30, 1999 and the related
condensed consolidated statements of operations and cash flows for the six
moths ended June 30, 1999 and 1998, have been prepared by the Company
without audit. In the opinion of management, the condensed consolidated
financial statements contain all adjustments, consisting only of normal
recurring accruals, necessary to present fairly the financial position of
Prime Companies, Inc., and their cash flows for the six months ended June
30, 1999 and 1998. The results of operations for the six months ended June
30, 1999 are not necessarily indicative of the results to be expected for
the entire fiscal year ending December 31, 1999.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. It is suggested that these
condensed consolidated financial statements be read in conjunction with the
consolidated financial statements and notes thereto included in the
Company's report on Form 10-KSB for the year ended December 31, 1998.
Certain reclassifications have been made to the prior year's condensed
consolidated financial statements to conform with the current presentation.
Such reclassifications had no effect on net loss.
PRIOR PERIOD ADJUSTMENT
The Company has restated its prior year financial statements to record a
valuation allowance against deferred tax assets, to correct the
classification of equity between paid-in capital and retained earnings, and
to correct the valuation of investments. The effect on results of
operations for the year ended December 31, 1997 was to decrease income from
continuing operations by $43,299 ($0.01 per share), increase the provision
for taxes applicable to loss from operations of Mid-Cal Express by
$400,390, and increase net loss by $443,689 ($0.13 per share).
The accompanying notes are an integral part of these condensed
consolidated financial statements.
10
<PAGE>
DISCONTINUED OPERATIONS
Having experienced significant losses in the operations of its trucking
and logistics subsidiaries, the Company's Board of Directors decided to
discontinue the operation of these subsidiaries through an orderly
liquidation. The Company ceased operations effective December 30, 1998.
In connection with the discontinuance, the Company sold the operating
assets of its trucking and logistics operations to Gulf Northern
Transport, Inc. (GNT), a wholly-owned subsidiary of U.S. Trucking, Inc.
(UST) in exchange for 400,000 shares of UST common stock, GNT's
assumption of $3,351,359 of underlying debt, and GNT's assumption of
certain operating leases. All other leases were terminated effective
December 31, 1998. All assumed debt and operating lease payments
aggregating approximately $2,547,000 are guaranteed by the Company.
These obligations expire in varying amounts through June 2003. In the
first quarter of 1999, Mid-Cal Express, Inc. granted Credit Managers
Association of California (CMA), trustee for all creditors of Mid-Cal
Express, Inc., a security interest in all assets of discontinued
operations and the investments held in escrow. CMA will represent the
unsecured creditors in a voluntary work-out plan for the 100%
satisfaction of the unsecured debts of Mid-Cal Express, Inc.
UST's stock was valued at $4.50 per share base based on the average
quoted market price of the stock for a period of three days prior and
after the transaction was agreed to. Operating assets not acquired by
GNT have been reduced to their estimated realizable value. The sale
resulted in a net gain of $1,135,536.
The net assets of discontinued operations consisted of the following:
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
------------------- --------------------
<S> <C> <C>
Accounts receivable, net $ 194,626 $ 929,529
Prepaid expenses -- 207,046
Equipment -- 112,000
Deposits 123,888 123,888
------------------- --------------------
Net assets of discontinued operations $ 318,514. $ 1,372,463
==================== ======================
</TABLE>
The trucking and logistics operations generated revenues of $4,518,000 and
$8,654,000 for the three and six months ended June 30, 1998. Loss from
operations of transportation segment included interest expense of $163,000
and 315,000 for the three and six months ended June 30, 1998.
COMMITMENTS AND CONTINGENCIES
LEASES
The Company has operating lease comments for its office space, which
expire over the next two years. The following is a schedule of future
minimum lease payments for operating leases (with initial or remaining
terms in excess of one year) as of December 31, 1998:
<TABLE>
<CAPTION>
DECEMBER 31,
<S> <C>
1999 $ 39,000
2000 36,000
</TABLE>
Rental expense for all operating leases was $367,000 and $631,000 for
the three and six months ended June 30, 1998. There was no operating
lease expense for the comparable 1999 periods.
The accompanying notes are an integral part of these condensed
consolidated financial statements.
11
<PAGE>
LITIGATION AND OTHER CLAIMS
The Company was a defendant in a wrongful death suit relating to an
accident involving one of its drivers. The claim was settled within
coverage limits.
The Company is obligated under its liability and property damage
insurance policies for losses up to the specific policy deductibles as
a result of accidents and claims incurred. Accrued loss reserves of
$40,856 as of June 30, 1999 were recorded to cover these potential
claims.
SUBSEQUENT EVENTS
On July 29, 1999, Prime Companies, Inc. entered into a Binding Letter
of Intent for Sale of Common Stock whereby, in consideration of a
private placement issue of 18,000,000 of the authorized but unissued
common stock, it acquired one hundred percent of the issued and
outstanding common stock of Worldnet Tel.com Inc. from the shareholders
of that corporation. The principal assets of Worldnet Tel.com Inc.
were twelve exclusive licenses granted by the FCC.
3. PROPERTY HELD FOR SALE
Property held for sale consists of the following at December 31, 1998
and June 30, 1999:
<TABLE>
<S> <C>
Land $ 520,162
Building and improvements 349,985
--------------------
870,147
Less accumulated depreciation (16,823)
$ 853,324
====================
</TABLE>
The property was currently leased to a third party under a non-cancelable
operating lease which expired in June 1999. The lease provided for monthly
rentals of $9,600. Rental revenue for the three months ended March 31, 1999
and 1998 was approximately $29,000, respectively. At March 31, 1999, future
minimum lease payments of $28,800 were due in 1999.
4. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
Accounts payable and accrued liabilities consisted of the following:
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
------------------- --------------------
<S> <C> <C>
Accounts payable $ 1,157,341 1,042,914
Accrued compensation and related 125,105 257,468
Accrued purchased transportation 87,549 274,083
Accrued interest 57,560 139,668
Accrued insurance -- 120,856
Claims loss reserve 40,856 68,402
Other accrued expenses 70,256 165,811
------------------ ------------------
The accompanying notes are an integral part of these condensed
consolidated financial statements.
12
<PAGE>
Total $ 1,538,667 $ 2,069,222
================== ==================
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
13
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MANAGEMENT'S PLAN OF OPERATION
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
Certain statements made herein or elsewhere by, or on behalf of, the Company
that are not historical facts are intended to be forward-looking statements
within the meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are based on
assumptions about future events and are therefore inherently uncertain.
The Company cautions readers that the following important factors, among others,
could affect the Company's consolidated results:
(1) Whether acquired businesses perform at pro forma levels used by management
in the valuation process and whether, and the rate at which, management is able
to increase the profitability of acquired businesses.
(2) The ability of the Company to manage its growth in terms of implementing
internal controls and information gathering systems, and retaining or attracting
key personnel, among other things.
(3) The amount and rate of growth in the Company's corporate general and
administrative expenses.
(4) Changes in interest rates, which can increase or decrease the amount the
Company pays on borrowings.
(5) Changes in government regulation, including tax rates and structures.
(6) Changes in accounting policies and practices adopted voluntarily or required
to be adopted by generally accepted accounting principles.
The Company cautions readers that it assumes no obligation to update or publicly
release any revisions to forward-looking statements made herein or any other
forward-looking statements made by, or on behalf of, the Company.
PLAN OF OPERATION
The following discussion provides information of the Company's plan of
operations for the next twelve months. The discussion should be read in
conjunction with the Company's un-audited financial statements included
elsewhere herein.
Effective December 30, 1998 the Company discontinued its transportation
services segment, which operated its "Express" and "Logistics" subsidiaries.
Having experienced significant losses in the Company's transportation operations
through June 30, 1998 management began a review of the entire transportation
group. Continued losses in the "Express" subsidiary without improvement led
management and the Board of Directors in December 1998 to decide to discontinue
long-haul transportation services. Faced with equipment licensing costs at the
end of December 1998, the Company entered into an Asset Buy-Sell Agreement with
Gulf Northern Transport, Inc., effective December 30, 1998, which effectively
discontinued operations in the long-haul transportation segment.
The accompanying notes are an integral part of these condensed
consolidated financial statements.
14
<PAGE>
During the year ended December 31, 1998 and 1997 the Company's
transportation segment generated revenues of $18,633,000 and $15,958,000,
respectively and losses of approximately $3,282,000 and $1,159,000,
respectively, exclusive of a gain on the sale of the "Express" subsidiary of
approximately $1,240,000 during the year ended December 31, 1998.
The Company is currently pursuing investments in technology-based
business activities that management believes will have future profit potential.
If the Company is successful in obtaining such technology, it will require
substantial additional capital to commercialize and market the technology. There
can be no assurance that the Company will be successful in any of these efforts.
Management estimates that the Company will need at least $200,000 in
cash to cover its overhead expenses during the next twelve months. Proceeds from
the sale of its Fontana real estate is expected to yield at least $300,000 net
of commissions after repayment of the related mortgage note payable. Additional
financing is expected to be available in the form of short-term credit provided
by affiliates.
The Company's ability to sustain operations in the future is dependent
upon its ability to obtain additional financing for working capital and to
acquire new business, its ability to develop and market a product as the
technology is acquired, if any, and ultimately, the attainment of profitable
operations. There can be no assurance that the Company will be successful in any
of these efforts.
YEAR 2000
The company is dependent on computer systems and system applications for
conducting its ongoing business functions. The issue involves the ability of
computer systems that have time sensitive programs to recognize properly the
Year 2000. The inability to do so could result in major failures or
miscalculations that would disrupt the Company's ability to meet its customer
and other obligations on a timely basis. The company has achieved substantial
compliance with respect to its business critical systems.
The total pre-tax cost associated with the required modifications and
conversions was nominal. The Company also has third party customers, financial
institutions, vendors and others with which it conducts business and has
confirmed their plans to address and resolve Year 2000 issues on a timely basis.
While it is likely that these efforts by third party vendors and customers will
be successful, it is possible that a series of failures by third parties could
have an adverse effect on the Company's results of operations in future periods.
The accompanying notes are an integral part of these condensed
consolidated financial statements.
15
<PAGE>
PRIME COMPANIES, INC.
AND CONSOLIDATED SUBSIDIARY COMPANIES
Part II. Other Information
ITEM 1. Legal Information
During the quarter ended March 31, 1998, one of the Company
tractors was involved in an accident, which resulted in
numerous personal injuries. Claims resulting from this
incident were very substantial. There was adequate insurance
coverage for these claims, which were settled in 1999.
ITEM 5. OTHER INFORMATION
Market for Registrant's Common Equity and Related Stockholder Matters.
The Company's stock trades under the trading symbol of
OTC:BB:PRMC on the over-the-counter bulletin board market. As
of June 30, 1999, shares were trading at $0.25 per share.
DIVIDEND POLICY.
The Company has never paid a cash dividend on its common
stock. It is the current intention of the Company's Board of
Directors to continue to retain earnings to finance the growth
of the Company's business rather than to pay dividends. Future
payment of cash dividends will depend upon the financial
condition, results of operations and capital commitments of
the Company, as well as other factors deemed relevant by the
Board of Directors.
Item 14. Exhibits and Reports on Form 8-K
None
The accompanying notes are an integral part of these condensed
consolidated financial statements.
16
<PAGE>
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.
PRIME COMPANIES, INC.
---------------------------------------
Registrant
DATED: August 9, 1999 /s/ Irving Pfeffer
--------------------------------------
Irving Pfeffer
Chairman/CEO
The accompanying notes are an integral part of these condensed
consolidated financial statements.
17
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> APR-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 60,314
<SECURITIES> 1,800,000
<RECEIVABLES> 194,626
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,861,332
<PP&E> 853,324
<DEPRECIATION> (16,823)
<TOTAL-ASSETS> 3,033,170
<CURRENT-LIABILITIES> 2,311,279
<BONDS> 0
0
0
<COMMON> 701
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 3,033,170
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 384,180
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 28,625
<INCOME-PRETAX> (393,605)
<INCOME-TAX> 0
<INCOME-CONTINUING> 19,200
<DISCONTINUED> 318,514
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (393,605)
<EPS-BASIC> (0.06)
<EPS-DILUTED> (0.06)
</TABLE>
