SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR QUARTER ENDED MARCH 31, 1999
Senior Retirement Communities, Inc.
(Exact name of registrant as specified in its charter)
Louisiana 72-1394159
- ---------------------------------- -------------------------------
(State or other jurisdiction (IRS Employer Identification
of incorporation Number
or organization)
507 Trenton Street, West Monroe, Louisiana 71291
(Address of principal executive offices)(Zip code)
Registrant's telephone number, including area code (318) 323-2115
Number of share outstanding of each of the registrant's class of common
shares and preferred shares, as of
March 31, 1999
Common Shares 624,410 par value $.10 per share:
Preferred shares 425,000 par value $1.00 per share:
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 twelve (12) months (or for such shorter
period that the registrant was required to file such report) and (2) has
subject to such filing requirements for the past ninety (90) days.
Yes X No
------ -------
<PAGE>
Senior Retirement Communities, Inc.
Form 10-QSB
TABLE OF CONTENTS
Part 1: Financial Information Page
Item 1. Financial Statements (Unaudited)
Balance Sheets as of March 31, 1999 (unaudited) ............. 2
Statements of Income for the three months ended
March 31, 1999 (unaudited) and three months ended
March 31, 1998 (unaudited)................................... 3
Statement of Retained Earnings for the three months
March 31, 1999 (unaudited) and March 31, 1998 (unaudited)..... 5
Statements of Cash Flows for the three months ended
March 31, 1999 and ended March 31, 1998 (unaudited)........... 6-7
Notes to Financial Statements................................. 8-11
Item 2. Management's Discussion and Analysis of Financial Conditions
and Results of Operations................................. 12-16
Part II: Other Information
Item 1. Legal Proceedings......................................... 16
Item 2. Changes in Securities..................................... 16
Item 3. Defaults Upon Senior Securities........................... 16
Item 4. Submission of Matters to a Vote of Security Holders....... 16
Item 5. Other Information......................................... 16
Item 6. Other Matters............................................. 16
Item 7. Exhibits and reports on Form 8-K ......................... 16
<PAGE>
SENIOR RETIREMENT COMMUNITIES, INC.
FINANCIAL STATEMENT
MARCH 31, 1999
<PAGE>
Senior Retirement Communities, Inc.
Financial Statement
March 31, 1999
Table of Contents
Page
FINANCIAL STATEMENTS:
Report 1
Balance Sheet 2
Statement of Income 4
Statement of Retained Earnings 5
Statement of Cash Flows 6
Notes to Financial Statements 8
<PAGE>
Senior Retirement Communities, Inc
To the Board of Directors and Shareholders
Senior Retirement Communities, Inc.
West Monroe, Louisiana
The accompanying balance sheet of Senior Retirement Communities, Inc.
as of March 31, 1999 and the related statement of income, retained earnings
and cash flows for the three months then ended March 31, 1999 and three
months then ended March 31, 1998 were prepared internally from the books
and records of Senior Retirement Communities, Inc. These financial statements
were not audited or reviewed.
Joanne Caldwell-Bayles
President, Senior Retirement Communities, Inc.
May 7, 1999
507 Trenton Street West Monroe, LA 71291 - 318 323-2115 - FAX 318-3236281
<PAGE>
-2-
Senior Retirement Communities, Inc.
Balance Sheet
March 31, 1999
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Current assets:
Cash $ 10,525
Escrow cash 361,018
Sinking fund cash 172,005
-----------
Total current assets 543,548
-----------
Property, plant and equipment
Buildings 7,812,888
Furniture and fixtures 93,608
Land 1,508,820
-----------
$ 9,415,316
Less: Accumulated depreciation 34,223
-----------
Net property and equipment 9,381,093
-----------
$ 9,924,641
-----------
</TABLE>
See accompanying notes.
<PAGE>
Senior Retirement Communities, Inc. -3-
Balance Sheet
March 31, 1999
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C>
Current liabilities:
Accounts payable and accrued expenses $ 21,448
-----------
Long-term debt:
Bonds payable 7,986,887
-----------
Other liabilities:
Due to stockholders and affiliates 588,641
-----------
Stockholders' Equity
Common stock, $2 par value, 1,500,000
shares authorized, 624, 410 shares issued
and outstanding 62,441
Preferred stock, $ 1 par value, 425,000
shares authorized, issued and outstanding 425,000
Additional paid-in capital 1,186,379
Retained earnings (deficit) accumulated
during the development stage (346,155)
-----------
Total stockholders' equity 1,327,665
-----------
$ 9,924,641
-----------
</TABLE>
See accompanying notes.
<PAGE>
Senior Retirement Communities, Inc. -4-
Statement of Income
For the three months ended
<TABLE>
<CAPTION>
March 31, 1999 March 31, 1998
<S> <C> <C>
Revenues $ 32,639 $ 0
------------- -------------
Operating expenses
Accounting 12,000 0
Activities 885 0
Advertising 6,231 0
Automobile 713 319
Bank charges 104 27
Bond agent fees 10,630 0
Carpet cleaning 88 0
Consulting 15,000 0
Casual labor 0 0
Decorations 620 0
Depreciation 28,232 0
Dues and subscriptions 370 125
Employee acquisition and training 3,308 0
Equipment rental 238 0
Food cost 6,247 0
Housekeeping 1,615 0
Insurance 6,614 0
Interest 128,182 0
Legal and accounting 150 50
Licenses and permits 264 0
Management fees 2,124 0
Miscellaneous 618 0
Office 1,429 0
Payroll 54,164 0
Postage and delivery 797 154
Printing 4,736 272
Promotion 1,490 0
Repairs 1,822 0
Taxes 1,506 0
Telephone 4,401 0
Travel and entertainment 2,794 175
Uniforms 182 0
Utilities 14,283 0
Van expense 2,799 0
------------- -------------
Total operating expenses 314,636 1,135
------------- -------------
Net income (loss) $ (281,997) $ (1,135)
------------- -------------
Earning (Loss) per share $ (0.45) 0.00
See accompanying notes.
</TABLE>
<PAGE>
Senior Retirement Communities, Inc. -5-
Statement of Retained Earnings ( Deficit )
For the three months ended
<TABLE>
<CAPTION>
March 31, 1999 March 31, 1998
<S> <C> <C>
Beginning retained earnings $ (59,908) $ (641)
Net income (loss) (281,997) (1,135)
Preferred dividends paid (4,250) 0
------------- -------------
Ending retained earnings (deficit) $ (346,155) $ (1,776)
------------- -------------
</TABLE>
See accompanying notes.
<PAGE>
Senior Retirement Communities, Inc. -6-
Statement of Cash Flows
For the three months ended
<TABLE>
<CAPTION>
March 31, March 31,
1999 1998
<S> <C> <C>
Cash flows from operating activities:
Revenues received $ 32,639 $ 0
Cash paid to suppliers and employees (259,152) (1,135)
---------- ----------
Net cash provided (used) by operations (226,513) (1,135)
---------- ----------
Cash flows from investing activities
Purchase of equipment (18,506) 0
Payments towards construction (773,655) (265, 905)
Payments of deposits 0 (2,000)
Payment of deferred charges (154,750) (120,000)
---------- ----------
Net cash provided by (applied to)
Investing activities (946,911) (387,905)
---------- ----------
Cash flows from financing activities
Payment of construction loans (1,002,535) 211,465
Issuance of bonds 1,462,500 0
Payment of bonds (239,750) 0
Payment of Preferred dividends (4,250) 0
Loans from stockholders and affiliates 164,424 198,753
---------- ----------
Net cash provided by (applied to)
financing activities 380,389 410,218
---------- ----------
Net increase (decrease) in cash (793,035) 21,178
Cash at the beginning of the period 1,336,583 (21,053)
---------- ----------
Cash at the end of the period 543,548 125
---------- ----------
</TABLE>
See accompanying notes.
<PAGE>
Senior Retirement Communities, Inc. -7-
Statement of Cash Flows
For the three months ended
<TABLE>
<CAPTION>
March 31, March 31,
1999 1998
Reconciliation of net income to net cash provided by operations:
<S> <C> <C>
Net income (loss) from operations $ (281,997) $ (1,135)
Adjustments to reconcile net income to cash
provided by operations
Depreciation 28,232 0
Amortization deferred charges 5,054 0
Decrease (increase) in prepaid expenses 4,125 0
Increase in accrued expenses 18,073 0
Net cash provided (used) by operations $ (226,513) $ (1,135)
</TABLE>
See accompanying notes.
<PAGE>
Senior Retirement Communities, Inc. -8-
Notes to Financial Statements
Note 1 - Summary of Significant Accounting Policies
Nature of Business
The Company is a Louisiana corporation established to develop assisted
living center and dementia facilities for the housing and care of senior
citizens in Ruston, Bossier City and Shreveport, Louisiana.
Basis of Accounting
The Company uses the accrual basis of accounting and will utilize a
calendar year for all reporting purposes.
Income Taxes
The Company is treated as a corporation for federal income tax purposes.
Property, Buildings, Equipment, and Depreciation
Buildings and equipment are stated at cost and are to be depreciated
by the straight-line method over there estimated economic lives.
Buildings include capitalized construction period interest which will
be treated as a component cost of the building and depreciated over the
same economic life as the building.
Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affects certain reported amounts and disclosures.
Accordingly, actual results could differ from those estimates.
Advertising
The Company follows the policy of charging the costs of advertising
to expense as incurred.
<PAGE>
Senior Retirement Communities, Inc. -9-
Notes to Financial Statements
Note 1- Summary of Significant Accounting Policies- (continued)
Deferred Charges
Deferred charges represents the costs associated with obtaining long
term financing for the care facilities of the Company. These costs are
to be amortized over the life of the bonds using the effective interest
rate method.
Basis of Presentation
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with instructions to Form 10-QSB and Article
10 of Regulations S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. In management's opinion,
all adjustments (consisting of normal recurring adjustments) considered
necessary for a fair presentation of the unaudited interim financial
statements have been included. Operating results for interim periods
reflected are not necessarily indicative of the results that may be
expected for a full fiscal year. These financial statements should be
read in conjunction with the financial statements and notes thereto
included in the Company's Form 10-QSB.
Certain reclassifications have been made to previously reported amounts
to conform with the current presentation.
Note 2 - Related Party Transactions
The Company has entered into a construction contract in the amount of
$ 2,750,000 with one of the shareholders to construct the Ruston
facility. The contract calls for the cash payments of $ 2,500,000
during the building of the facility as approved by the contract engineer
and the issuance of an additional 125,000 shares of common stock at the
completion of the project, such stock issuance to represent the builder's
profit in the project. As of March 31, 1999, $ 2,470,553 has been paid
on this contract.
The Company has entered into a construction contract in the amount of
$ 1,225,000 with one of the shareholders to construct the Shreveport
facility. The contract calls for the cash payments during the building
of the facility as approved by the contract engineer. As of March 31,
1999, $ 1,204,033 has been paid on this contract.
<PAGE>
Senior Retirement Communities, Inc. -10-
Notes to Financial Statements
Note 2- Related Party Transactions - (continued)
The Company has entered into a construction contract in the amount of
$2,200,000 with one of the shareholders to construct the Bossier City
facility. The contract calls for the cash payments during the building
of the facility as approved by the contract engineer. As of March 31,
1999, $ 2,172,888 has been paid on this contract.
Due to stockholders and affiliates consist of amounts advanced by
stockholders and other related entities.
Through March 31, 1999, the Company has incurred $ 217,487 of interest
expense, of which $ 89,305 has been treated as construction period
interest and included as part of the Building construction on progress
on the balance sheet and the remainder of $ 128,182 has been charged to
operations.
Note 3 - Preferred Stock
The Preferred Stock issued accrues dividends at the rate of four percent
per year for each of the first two years, then six percent per year for
the next two years then at eight percent per year for the final two
years. The Preferred Stock is callable at the Company's option and
shall be redeemed at the end of the sixth year if still outstanding.
The preferred shareholders have an option to purchase common stock at a
twenty percent discount at any time within eight years of the preferred
stock issue dates if the Company issues additional common stock through
a public offering.
Note 4 - Development Stage Operations
The Company has completed construction of the Ruston, Shreveport, and
Bossier City facilities. Ruston was completed effective December 1,
1998, Shreveport was completed January 22, 1999 and Bossier City was
completed March 10, 1999.
<PAGE>
Senior Retirement Communities, Inc. -11-
Notes to Financial Statements
Note 5 - Bonds Payable
On June 23, 1998, the Company's issue of $ 9,000,000 of bonds became
effective. These bonds are to become the permanent financing for the
projects reflected in this financial statement. As of March 31, 1999,
these bonds are in the process of being sold with the proceeds of these
bond sales used to liquidate the construction loans. As of April 16,
1999, the status of these bonds is as follows:
<TABLE>
<CAPTION>
Amount Amount
Location Authorized Issued
<S> <C> <C>
Ruston $ 3,685,000 $ 3,407,750
Bossier City 3,470,000 3,443,750
Shreveport 1,845,000 1,845,000
---------- ----------
Totals $ 9,000,000 $ 8,423,000
---------- ----------
</TABLE>
These bonds have varying interest rates from 7.5 percent per annum to
11 percent per annum. The maturity of these bonds is from one to twenty
years.
<PAGE>
-12-
MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL
CONDITIONS AND RESULTS OF OPERATIONS
This commentary should be read in conjunction with the following documents
for a full understanding of Senior Retirement Communities, Inc. financial
condition and the status of the Company which reflects little or no operations;
the entire Prospectus dated June 23, 1998; 10KSB for the period ending
December 31, 1998; and the unaudited financial statement presented herein
along with all of the footnotes thereto as well as Method of Operation
which provides additional information.
As a result of the Company having little or no operations as of the end
of the first quarter, readers should be aware of the success and/or failures
within the assisted living industry. Because the bonds are being sold
on a best efforts basis, particular attention should be paid to the bond
sale results as set forth in footnote 5 of the financial statement.
The Ruston, Louisiana ALF containing 48, combination units (assisted/
independent living units) opened for business in October 1998. The Company
is converting independent living units and adding additional facilities
to be operated as a 16-unit Dementia facility, along with activity and
dinning facilities. When completed the Ruston ALF will contain 40
Assisted/Independent and 16 Alzheimer's units. The conversion is the result
of an increase demand for Alzheimer's facilities in the area and a decrease
in independent living facility needs. As of May 5, 1999, the Ruston facility
had eleven residents in assisted living, two deposits moving in for assisted
living, two residents be scheduled to move in the dementia facility as soon
as construction is completed, which is expected within two weeks. Therefore
the facility is anticipated to be twenty-seven (27%) per cent occupied
within two weeks, not counting day care.
One facility is located in Bossier City, with a 36-unit assisted living
facility and a 24-unit Dementia facility. The Bossier City facilities
open for business on March 10, 1999. As of May 5, 1999 the Bossier
facilities has two residents in assisted living and two in the dementia unit
and two dementia day care residents. Therefore the facility is seven (7%)
per cent occupied as of May 5, 1999 not counting day care.
The other site is located in Shreveport, Louisiana consisting of a 24-unit
Dementia facility. The Shreveport facility opened for business on January
22, 1999. As of May 5, 1999 six out of twenty-four units were occupied
with full time residents. In addition to the full time residents, there
were three day care residents. Therefore the facility is twenty-five (25%)
occupied as of May 5, 1999 not counting day care.
<PAGE>
-13-
The construction of the facilities were financed through the sale of
Co-First Mortgage bonds as set forth in the prospectus dated June 23,
1998 with construction loans provided by Church Loans and Investments
Trust.
The Company also owns approximately 26 acres of land located in Ruston
(20 acres), Shreveport (2 acres), and Minden (4 acres), Louisiana for
future construction.
The Company continues to finance the expansion and development by a
combination of private placement of common stock and preferred stock as
well as the public offering of First Mortgage Bonds. In March 1998 the
company purchased approximately 6 acres of land for $525,000 paying $100,000
in cash and the issuing 425,000 shares of $1.00 par value Preferred stock.
The property is the location of the Bossier City, Louisiana facility.
The preferred stock is paying dividends at a rate of 4% for the first
two years, 6% for the second two years, and 8% for the final two years.
The preferred stock shall be redeemed in full at the end of the fifth
year for the total sum including accrued dividends. It is recallable
at anytime at the option of the company.
The holders of the preferred stock shall also have the right to purchase
common stock at a 20% discount if and when the Company issues additional
common stock in the form of a public offering if done so within 8 years
of date issued for preferred stock.
Change in Employees
Prior to the opening of the Ruston ALF, the Company had no operations.
Employees consisted of the President, Joanne M. Caldwell-Bayles, and
two other employees. As of May 5, 1999, the Company had forty-six employees.
As occupancy increases, additional employees will be required. The number
required will be determined by the increase in occupancy of each facility.
Results of operations:
The Company's first ALF opened for business on October 16, 1998 in Ruston,
Louisiana. The facility has been well received by the community. There
have been insufficient rentals to form an opinion of future success with
any certainty. The operating loss for the first quarter of 1999 was $281,997,
which included start-up costs for Bossier City and Shreveport facilities.
The Shreveport and Bossier City facilities were opened for business in the
first quarter of 1999 at which point all of the facilities were open and
operating. Operating expenses for the first quarter of 1999 exceeded
expectations because of delays in opening due to weather and increased
training cost for each facility.
-14-
Major changes in Financial Conditions
The major changes in financial condition between March 31, 1998 and
March 31, 1999 is as follows: Current assets consisted primarily of cash
in the amount of $5,43,548. Cash is restricted as follows: $172,005 to
fund bond reserve accounts and the balance of $361,018 is restricted to
pay operating fund payments. Property and equipment increased from $8,617,164
as of December 31,1998 to $9,381,093 as of March 31, 1999. The increase
is the result of completion of building projects and acquisition of equipment
for the three locations. Total current liabilities decreased $1,490,711
as of December 31, 1998 to $21,448 as of March 31, 1999 consisting primarily
due to retirement of interim construction loans. Long term debt increased
from $7,123,000 as of December 31, 1998 to $7,986,887 as of March 31,
1999 which consisted of bond payables. Liabilities due stockholders and
affiliates increased from $424,217 as of December 31, 1998 to $588,641
as of March 31, 1999. Total stockholders equity decreased from $1,613,912
as of December 31, 1998 to $1,327,665 as of March 31, 1999 due to the
operating loss for the first quarter.
Liquidity and Financial Position
The Company receives significant operating funds from its affiliate The
Forsythe Group, Inc. through short-term loans. The ability of The Forsythe
Group to continue to make available loans is necessary for the continuing
success of the company. If future conditions would create problems in
Forsythe's ability to advance funds to the Company, the Company's future
success would be in doubt.
Year 2000
The Company relies on computer hardware, software, and related technology,
together with data, in the operation of its business. In addition, the
Company is dependent on the same type of technology and data generated
by financial institutions; the Federal Government including the Social
Security Administration; State of Louisiana; investment bankers; trustees
for the bondholder; interim lenders; and utility companies. The Company
has initiated an enterprise wide program to prepare for the year 2000.
The Company has created a year 2000 program office reporting to the Chief
Executive Officer to coordinate and oversee the company's year 2000 program.
All of the Company's computer systems have been cleared to meet the year
2000 requirements by contacting the manufacturer of the equipment and
receiving written notice of compliance.
The computer software necessary for the accounting function has also
been cleared for the year 2000 requirements in writing from the developer
of the accounting software.
The Company has discussed the year 2000 with all of the above set forth
companies and agencies and has been assured either in writing or verbally
that each anticipates
<PAGE>
-15-
compliance for the year 2000. As a result of the Company's own operations
already being in compliance with the year 2000, it is dependent upon outside
forces to also be in compliance. It is impossible for the Company to
be sure that all governmental agencies, utilities, financial institutions,
and others with whom it does business will also be in compliance. The
failure or some or all the above stated agencies being in compliance with
the year 2000 would be catastrophic, and the survival of the Company would
be in doubt.
Because of the uncertainty of the problems faced with the year 2000 the
Company has adopted an action plan to protect the seniors living with
the Communities. The major item to be included is as follows;
1. Place in storage at each community a five-day supply of food items,
including canned meats and vegetables, water, and other non-perishable
items necessary for providing meals.
2. Prepare, with the assistance of residents, a five-day supply of clothing
that will not have to be cleaned in order to aid in healthy living.
3. Encourage physicians to obtain and supply adequate supply of necessary
medical needs of residence.
4. Encourage residents and their families to meet the financial needs
for each resident by having some cash on hand at the end of the year.
The cash to be reserved for residences should not be held at the
residents quarters.
5. Work with local officials in preparing a safety plan of operation
in event of failure of medical, public safety, utilities and other
services.
6. Adequate fuel to operate vehicles, heating devices and other services.
7. Such other assistance that may come to our attention as the Company
continues to monitor the year 2000 problems.
Forward- Looking Statements:
Statements that are not historical facts, including statements about
(I) operating profits or losses as those discussed in results of operations;
(II) completion dates of facilities; (III) fixed asset expenditures; and
(IV) the successful sale of the balance of the bonds are forward-looking
statements that involve risks and uncertainties. The Company wishes to
caution the reader that factors below, along with the factors set forth
in the Company's June 23, 1998 prospectus and in the Company's other documents
filed with the SEC, have affected and could affect the Company's actual
results causing results to differ materially from those in any forward-looking
statement. These factors include: the acceptance of the Assisted Living
Concept by each of the communities in which they are located, increased
competition in each of the communities, economic outlook whether the economy
improves or slips into recession, technological changes in dealing with
seniors, change in government regulation, the success of strategic decisions
to improve financial
<PAGE>
-16-
performance, the ability of the Company to contain cost, and the continued
increase in the market acceptance of ALF's.
Part II - Other Information
Item 1. Legal proceedings
None
Item 2. Change in Securities
None
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: Other Matters
None
Item 7. Exhibits and reports on Form 8-K
None
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.
Senior Retirement Communities, Inc. (Registrant)
/S/JOANNE M CALDWELL-BALYES
Date: May 5, 1999 By: Joanne M. Caldwell-Bayles
President, Finance and Treasurer
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
==============================================================================
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
THE UNAUDITED FINANCIAL STATEMENT OF SENIOR RETIREMENT COMMUNITIES, INC.
DATED MARCH 31, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
INFORMATION SET FORTH IN THIS SCHEDULE DOES NOT CONTAIN ALL OF THE INFORMATION
NECESSARY AND SHOULD BE READ IN CONJUNCTION WITH THE COMPLETE UNAUDITED
FINANCIAL STATEMENT DATED MARCH 31, 1999 INCLUDING FOOTNOTES.
===============================================================================
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 10,525
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,080,300
<PP&E> 9,415,316
<DEPRECIATION> 34,223
<TOTAL-ASSETS> 9,924,641
<CURRENT-LIABILITIES> 21,448
<BONDS> 7,986,887
425,000
0
<COMMON> 62,441
<OTHER-SE> 1,327,665
<TOTAL-LIABILITY-AND-EQUITY> 9,924,641
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 259,152
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 128,182
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (281,997)
<EPS-PRIMARY> (.45)
<EPS-DILUTED> (.45)
</TABLE>
