<PAGE>
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 for the quarterly period ended June 30, 1999
Commission file number 000-24835
PTN Media, Inc.
(Exact name of Small Business Issuer as Specified in Its Charter)
Delaware 38-3399098
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
2750 South State Street, Ann Arbor, Michigan 48104
(Address of principal executive offices)
Registrant's telephone number, including area code (734) 327-0579
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 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 No X
----- -----
Indicate the number of shares outstanding of each of the issuer's
classes of common equity, as of September 8, 1999: 3,440,562
Transitional Small Business Disclosure Format (check one):
Yes No x
----- -----
<PAGE>
PTN MEDIA, INC.
INDEX
Page(s)
-------
PART 1. Financial Information
ITEM 1. Financial Statements
Condensed Balance Sheets as of June 30, 1999
(unaudited) and December 31, 1998 3
Statements of Operations for the Three and Six
Month Periods Ended June 30, 1999 and 1998 and
for the Cumulative Period From May 27, 1997
(Inception) to June 30, 1999 (Unaudited) 4
Statements of Cash Flows for the Six Month Periods
Ended June 30, 1999 and 1998 and for the Cumulative
Period During the Development Stage from May 27,
1997 (Inception) to June 30, 1999 (Unaudited) 5
Notes to Interim Condensed Financial Statements 6
Management's Plan of Operation 9
PART II Other Information 13
SIGNATURES 14
Exhibit 27 - Financial Data Schedule
<PAGE>
PART I. Financial Information
ITEM 1. Financial Statements
PTN MEDIA, INC.
(a Development Stage Company)
CONDENSED BALANCE SHEETS
- ASSETS -
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
------------- ------------
(unaudited)
<S> <C> <C>
CURRENT ASSETS:
Cash $ 54,258 $ 702
Accounts receivable - 4,488
------------ -----------
TOTAL CURRENT ASSETS 54,258 5,190
FIXED ASSETS - NET 19,879 3,626
OTHER ASSETS:
Security deposits 690 690
------------ -----------
$ 74,827 $ 9,506
============ ===========
- LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT) -
CURRENT LIABILITIES:
Accrued expenses $ 186,110 $ 133,815
License fees payable (Note 5) 115,000 255,000
Short-term loans payable (Note 3) 331,250 56,250
Loans payable - officer (Note 4) 504,344 542,500
------------ -----------
TOTAL CURRENT LIABILITIES 1,136,704 987,565
------------ -----------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY (DEFICIT) (Note 2):
Preferred stock, par value $.01; 1,000,000 shares authorized,
2,400 issued and outstanding for 1999 24 -
Common stock, par value $.001; 10,000,000 shares authorized,
3,440,262 and 3,378,262 shares issued and outstanding for
1999 and 1998, respectively 3,440 3,378
Additional paid-in capital 1,922,317 1,608,910
Deficit accumulated during the development stage (2,987,658) (2,590,347)
------------ -----------
(1,061,877) (978,059)
------------ -----------
$ 74,827 $ 9,506
============ ===========
</TABLE>
See notes to interim condensed financial statements.
3
<PAGE>
PTN MEDIA, INC.
(a Development Stage Company)
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Cumulative
For the For the During The
Three Months Ended Six Months Ended Development Stage
June 30, June 30, May 27, 1997 to
1999 1998 1999 1998 June 30, 1999
--------- --------- --------- -------- -------------------
<S> <C> <C> <C> <C> <C>
REVENUES $ 3,844 $ - $ 13,216 $ - $ 17,704
--------- --------- --------- --------- -----------
EXPENSES:
Cost of revenue 30,000 150,000 43,923 200,000 1,772,651
Product development 98,885 99,900 158,885 204,715 640,973
General and administrative 98,033 62,267 175,244 135,261 529,908
--------- --------- --------- --------- -----------
226,918 312,167 378,052 539,976 2,943,532
--------- --------- --------- --------- -----------
LOSS FROM OPERATIONS (223,034) (312,167) (364,836) (539,976) (2,925,828)
--------- --------- --------- --------- -----------
OTHER INCOME (EXPENSE):
Interest expense (19,350) (7,000) (32,475) (12,730) (61,869)
Interest income - 155 - 177 39
--------- --------- --------- --------- -----------
(19,350) (6,845) (32,475) (12,553) (61,830)
--------- --------- --------- --------- -----------
NET LOSS $(242,384) $(319,012) $(397,311) $(552,529) $(2,987,658)
========= ========= ========= ========= ===========
BASIC LOSS PER COMMON SHARE
(Note 6) $(.07) $(.10) $(.12) $(.18) $(.88)
===== ===== ===== ===== =====
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING
(Note 6) 3,440,262 3,041,680 3,388,881 3,041,680 3,378,202
========= ========= ========= ========= =========
</TABLE>
See notes to interim condensed financial statements.
4
<PAGE>
PTN MEDIA, INC.
(a Development Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Cumulative
During The
Development
For the Six Months Ended Stage
June 30, (May 27, 1997 to
1999 1998 June 30, 1999)
-------- -------- ----------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS:
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(397,311) $(552,529) $(2,987,658)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation of fixed assets 2,087 490 2,967
Shares issued for legal fees - 13,000 14,000
Waiver of compensation payable - - 66,000
Issuance of shares for license fees - - 1,078,728
Changes in operating assets and liabilities:
Decrease in accounts receivable 4,488 - -
Increase in accrued expenses 52,295 108,636 236,110
Increase (decrease) in license fees payable (140,000) 100,000 115,000
--------- --------- -----------
Net cash (used) by operating activities (478,441) (330,403) (1,474.853)
--------- --------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of fixed assets (18,340) (1,959) (22,846)
Security deposits paid - (690) (690)
--------- --------- -----------
Net cash (used) by investing activities (18,340) (2,649) (23,536)
--------- --------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Loans received from officer - 270,000 542,500
Loans repaid to officer (38,156) - (38,156)
Proceeds from short-term loans 275,000 97,500 493,750
Payment from shareholders - 2,957 2,957
Net proceeds from sale of shares 313,493 (18,243) 551,596
--------- --------- -----------
Net cash provided by financing activities 550,337 352,214 1,552,647
--------- --------- -----------
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS 53,556 19,162 54,258
Cash and cash equivalents, at beginning of period 702 20,134 -
--------- --------- -----------
CASH AND CASH EQUIVALENTS, AT END OF PERIOD $ 54,258 $ 39,296 $ 54,258
========= ========= ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Interest paid $ - $ - $ -
Taxes paid - - -
</TABLE>
See notes to interim condensed financial statements.
5
<PAGE>
PTN MEDIA, INC.
(a Development Stage Company)
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 - DESCRIPTION OF COMPANY AND GOING CONCERN UNCERTAINTY:
PTN Media, Inc., the Company, was incorporated in Delaware on
January 13, 1998 and is the successor to Interactive
Entertainment Studio, Inc. (IES). IES was incorporated in the
State of Nevada on May 27, 1997 and was merged into the Company
in March 1998, for the sole purpose of changing the domicile of
the Company to Delaware. The Company has been in the
development stage in accordance with Statement of Financial
Accounting Standards No. 7, since its inception.
The Company is an interactive content provider focusing on
providing leading branded content for well-defined target
audiences using a combination of new and traditional media. The
Company provides this content on its interactive web sites in
the form of articles and photographs pertaining to fashion,
beauty, style and entertainment. These web sites, utilizing
celebrity models as hosts, will provide an avenue for users to
share general tips and advice relating to the subjects covered.
The Company, since its inception, has incurred net losses of
$2,987,658 and at June 30, 1999 current liabilities exceeded
current assets by $1,082,446. The Company has relied on bridge
financing, the proceeds from the sale of common stock through
an initial public offering, officer's loans and from the sale
of preferred stock to fund its activities. The Company may be
unable to continue in existence unless it is able to arrange
additional financing. The financial statements do not include
any adjustments relating to the recoverability of assets that
might be necessary in the event the Company cannot continue in
existence.
The accounting policies followed by the Company are set forth
in Note 2 to the Company's financial statements included in its
annual report on Form 10-KSB for the year ended December 31,
1998 and which is incorporated herein by reference. Specific
reference is made to this report for a description of the
Company's securities and the notes to the financial statements
included therein.
In the opinion of management, the accompanying unaudited
interim condensed financial statements of PTN Media, Inc.
contain all adjustments necessary to present fairly the
Company's financial position as of June 30, 1999 and the
results of its operations for the three and six month periods
ended June 30, 1999 and 1998 and for the cumulative period
during the development stage (May 27, 1997 to June 30, 1999)
and its cash flows for the six month periods ended June 30,
1999 and for the cumulative period during the development stage
(May 27, 1997 to June 30, 1999).
The results of operations for the three and six month periods
ended June 30, 1999 and 1998 are not necessarily indicative of
the results to be expected for the full year.
6
<PAGE>
PTN MEDIA, INC.
(a Development Stage Company)
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
(Unaudited)
NOTE 2 - SALE OF SHARES:
On September 18, 1998, the Securities and Exchange Commission
declared effective the Company's registration statement
concerning an initial public offering ("IPO") of 400,000 shares
of common stock. On October 22, 1998, the Company extended the
expiration date of the initial public offering to January 31,
1999. As of December 31, 1998, the Company had consummated the
sale of 66,900 shares of common stock and in February 1999, the
Company consummated the sale of an additional 62,000 shares of
common stock. The aggregate net proceeds from the IPO was
$335,596.
As of June 30, 1999, the Company completed the sale of 2,400
shares of Class A preferred stock in a private offering of such
securities, generating net proceeds of $216,000. The purchasers
of these securities also received two-year warrants to purchase
5,000 shares of common stock, for every $25,000 of preferred
stock purchased, at an exercise price of $7.50. The preferred
shares accumulate dividends at the rate of $10 per share per
annum and are convertible to common shares at the option of the
holders.
NOTE 3 - SHORT-TERM LOANS PAYABLE:
In July and August 1997, the Company received $56,250 through
the issuance of 8% promissory notes and common stock purchase
warrants to acquire Company stock. The 45,000 warrants issued,
which expire in July 2001, entitle the holders to purchase
45,000 shares of common stock at an exercise price of $3.00 per
share, the deemed fair value of the warrants at the time of
issuance. The notes and accrued interest are payable one year
from the date of issuance or the closing of an equity funding
of the Company of a minimum of $500,000, whichever is sooner.
These notes continue to be outstanding notwithstanding the fact
that payments owed by the Company thereunder are now past due.
Interest accrued and unpaid as of June 30, 1999 and December
31, 1998, aggregate $6,750 and $4,500, respectively.
In March 1999, the Company received $275,000 from the sale of 5
1/2 units, each unit consisting of a $50,000 promissory note,
bearing interest at 10% per annum, and two year warrants to
purchase 10,000 shares of common stock at $7.50 per share. As
of June 30, 1999, interest accrued and unpaid aggregated
$6,875.
NOTE 4 - LOANS PAYABLE - OFFICER:
In April 1998, the Company's Chairman, President and Chief
Executive Officer, provided the Company with a revolving credit
line with a maximum of $500,000 available. In September 1998,
the Board of Directors of the Company authorized an increase in
this line to $610,000 and in November and December 1998, a
further increase to $1,000,000, was authorized. Loans drawn
under this line bear interest at a rate of 9% per annum from
the date they are made to the Company and are payable by May
2001, provided, however, that if the Company raises gross
proceeds in an IPO of at least $1,500,000, the entire
outstanding amount and accrued interest will be repaid from the
proceeds from the IPO. As of December 31, 1998, borrowings
outstanding under this line aggregated $542,500, and interest
accrued and unpaid aggregated $22,644.
As of June 30, 1999, the Company repaid $38,156 of such loans.
Accrued interest as of June 30, 1999 aggregated $45,994.
7
<PAGE>
PTN MEDIA, INC.
(a Development Stage Company)
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
(Unaudited)
NOTE 5 - LICENSE AGREEMENT:
In June 1999, the Company entered into a License Agreement with
model Estella Warren. This license provides for an on-line
Internet service and downloadable electronic calendars
featuring the name and likeness of Ms. Warren. This agreement
continues until the first anniversary of the date the service
is launched and required payment of the entire fee of $30,000
at the time of execution. Ms. Warren also receives a royalty
equal to 20% of revenues received in connection with calendar
sales.
As of June 30, 1999, the Company paid $15,000 of the license
fee. The Company also continues to owe model Tyra Banks
$100,000 in connection with Internet service and calendar fees.
NOTE 6 - EARNINGS (LOSS) PER SHARE:
Earnings (loss) per share has been computed on the basis of the
weighted average number of common shares outstanding during
each period presented according to the standards of SFAS No.
128 "Earnings Per Share" ("SFAS 128").
8
<PAGE>
MANAGEMENT'S PLAN OF OPERATIONS:
PTN Media, Inc., the Company, is an interactive content
provider focusing on providing leading branded content for
well-defined target audiences using a combination of new and
traditional media. The Company provides this content on its
interactive web sites in the form of articles and photographs
pertaining to fashion, beauty, style and entertainment. These
web sites, utilizing celebrity models as hosts, will provide an
avenue for users to share general tips and advice relating to
the subjects covered.
The Company, since its inception, has incurred net losses of
$2,987,658 and at June 30, 1999, current liabilities exceeded
current assets by $1,082,446. The Company may be unable to
continue in existence unless it is able to arrange additional
financing to supplement its recently completed initial public
offering and bridge financing.
The Company has not yet generated any significant revenues and
is still considered in the development stage. Through June 30,
1999, cumulative revenues totaled $17,704, and resulted
entirely from the sale of calendars (see discussion below re:
Claudia Schiffer Calendar Agreement). The Company continues to
incur costs associated with the development of its proposed web
sites, none of which is at yet fully constructed.
Additionally, the Company has advanced $134,000 to a company
controlled by fashion model, Tyra Banks, pursuant to certain
agreements between the Company and Ms. Banks' company and has
also incurred expenses of approximately $10,000, to date, in
connection with the development of the intended web site to
have been hosted by Ms. Banks and in connection with the
development of calendars featuring her. In June 1998, Ms. Banks
declared the Company in breach of these agreements based on the
Company's alleged failure to pay the full amount of all
advances and reimbursable expenses allegedly owed pursuant to
such agreements. The agreement relating to the creation and
sale of calendars has been terminated. Although Ms. Banks also
claims that the web site agreement has been terminated, the
Company believes that it is currently in full compliance with
this agreement, and that Ms. Banks has refused to perform
thereunder. On December 8, 1998, attorneys for Ms. Banks made a
demand for arbitration against the Company alleging that the
Company failed to make timely payments of monies due under the
two executed agreements, and refused to return certain
materials to Ms. Banks. Ms. Banks is seeking payment of
$153,000 (which amount is recorded as a liability on the
financial statements) plus interest, as well as damages for
injury to her public reputation. On January 15, 1999, the
Company through its attorneys, filed an Answer and Counterclaim
to Ms. Banks' Demand for Arbitration. The Company raised
several defenses to Ms. Banks' claims and claimed a breach by
Ms. Banks and Bankable, Inc. of the Web Site Agreement. A
preliminary administrative conference was held on January 19,
1999 and a hearing was scheduled for April 23, 1999. The
hearing scheduled for April 23, 1999 was moved to June 15, 1999
due to Ms. Banks' inability to appear in April due to a prior
commitment to film a motion picture in Canada. The Company is
seeking the return of $100,000, plus interest, which was paid
to Ms. Banks. The Company intends to vigorously defend itself
in this arbitration, and believes that it has meritorious
defenses. However, there can be no assurance that the Company
will be successful in this arbitration and an unfavorable
result could have a material adverse effect on the Company due
to its limited resources.
The Company entered into a Web Site License Agreement with
Claudia Schiffer (the "Schiffer License Agreement") which
grants the Company the exclusive license for an on-line
Internet service devoted to Ms. Schiffer. The Company has the
right to use Ms. Schiffer's name and likeness for an Internet
site including a merchandise "boutique", monthly column and
interviews or on-line chat sessions. Ms. Schiffer also would
make promotional appearances and voice recordings to promote
the site and provide content for it. The Schiffer License
Agreement would continue until the year 2001. The Company would
pay Ms. Schiffer guaranteed minimum royalties
9
<PAGE>
of $300,000 for the first year (which amount was paid) of the
Schiffer License Agreement, $400,000 for the second year, and
$500,000 for the third year, which would be credited against
earned royalties ranging from 25% to 80% of site revenues and
profits from boutique merchandise sales.
The Schiffer License Agreement also granted to Ms.Schiffer,
269,682 shares of common stock (the "Shares"), with the right
to maintain the ratio of her common stock ownership to that of
the Company's President. The Company agreed to indemnify Ms.
Schiffer for any U.S. income tax liability resulting from the
issuance of these shares, however, the Company has been assured
that Ms. Schiffer is not a U.S. citizen or resident, and
therefore is not likely to be responsible for any such taxes.
The Company has also entered into a Licensed Calendar Agreement
with Ms. Schiffer ("Calendar Agreement"). The Calendar
Agreement grants the Company the right to use the name,
likeness, and endorsement of Ms. Schiffer in the advertisement,
promotion and sale of a16-month 1999 calendar with photographs
of her, in downloadable electronic format and CD-Rom ("Licensed
Calendar"). Ms. Schiffer will provide photographic images and
voice recordings for the Licensed Calendar. The Company agreed
to pay Ms. Schiffer an advance royalty in the aggregate amount
of $75,000 which was paid in 1998. The Company has also agreed
to pay to Ms. Schiffer royalties equal to a percentage of sales
ranging from 20% of net sales for 0-20,000 units, to 60% of net
sales for 50,001 units and above. This advance payment will be
credited against any earned royalty payment. The Calendar
Agreement terminates December 31, 1999.
In June 1999, the Company entered into a License Agreement with
model Estella Warren. This license provides for an on-line
Internet service and downloadable electronic calendars
featuring the name and likeness of Ms. Warren. This agreement
continues until the first anniversary of the date the service
is launched and required payment of the entire fee of $30,000
at the time of execution. Ms. Warren also receives a royalty
equal to 20% of revenues received in connection with calendar
sales.
As of June 30, 1999, the Company paid $15,000 of the license
fee.
The Company also hopes to launch "www.fragrancedirect.com," its
online fragrance sales effort, within the next 12 months. On
this web site the Company will sell colognes, perfumes and
other fragrances direct to Internet users, much in the same way
that books are sold on web sites such as "Amazon.com." The site
will be promoted through hyper-links from the Company's
affiliated web sites. The Company also intends to create mutual
linking arrangements with operators of apparel sites and to
make barter arrangements for advertising. The Company
anticipates that its prices will be lower than the
manufacturer's suggested retail prices, however, not
necessarily less than all retail outlets. The web site is
currently being tested. The web site was built and will be
maintained by an outside contractor whom the Company agreed to
pay a $3,000 one-time fee, $299 per month maintenance and 5% of
gross sales from the site with a $50,000 per year cap. The
outside contractor will process credit card orders.
The Company intends to obtain product liability insurance in
such amounts as it may deem appropriate to insure against any
possible product liability exposure resulting from the sale of
fragrances on the web site.
There can be no assurance that the Company will generate
substantial revenues from the web site. In addition, the
Company is aware of at least two similar web sites attempting
to compete for the on-line fragrance business.
10
<PAGE>
Cash Requirements:
In April 1998, the Company's Chairman, President and Chief
Executive Officer, provided the Company with a revolving credit
line with a maximum of $500,000 available. In September 1998,
the Board of Directors of the Company authorized an increase in
this line to $610,000 and in November and December 1998,
further increases to $1,000,000, were authorized. Loans drawn
under this line bear interest at a rate of 9% per annum from
the date they are made to the Company and are payable by May
2001, provided, however, that if the Company raises gross
proceeds in an IPO of at least $1,500,000, the entire
outstanding amount and accrued interest will be repaid from the
proceeds from the IPO. As of December 31, 1998, borrowings
outstanding under this line aggregated $542,500. Through June
30, 1999, the Company repaid $38,156 of these loans and as of
June 30, 1999, the outstanding loan balance was $504,344 and
interest accrued and unpaid amounted to $45,994.
On September 18, 1998, the Securities and Exchange Commission
declared effective the Company's Registration Statement
concerning an Initial Public Offering ("IPO") of 400,000 shares
of common stock, which the Company hoped would generate net
proceeds of approximately $1,600,000. This IPO expired on
January 31, 1999. As of December 31, 1998, the Company had
completed the sale of 66,900 shares of common stock and in
February 1999, closed on the sale of an additional 62,000
shares of common stock, realizing aggregate net proceeds of
$335,596. The net proceeds from this offering, along with
bridge loans received in 1997, have been used to satisfy the
Company's obligations under the License Agreements entered into
with the fashion models.
In March 1999, the Company completed the sale of 5.5 units,
each unit consisting of a $50,000 promissory note, bearing
interest at an annual rate of 10%, and warrants to purchase
10,000 shares of common stock at $7.50 per share.
As of June 30, 1999, the Company completed the sale of 2,400
shares of Class A Preferred Stock in a private offering of such
securities, generating net proceeds of $216,000. The purchasers
of these securities also received two-year warrants to purchase
5,000 shares of common stock for every $25,000 of Preferred
Stock purchased at an exercise price of $7.50. The preferred
shares accumulate dividends at the rate of $10 per share per
annum and are convertible to common shares at the option of the
holders.
Since the Company raised less than the estimated maximum amount
of net proceeds available pursuant to the Initial Public
Offering, the Company has insufficient funds available for
operations and would be required to seek additional financing
sooner than anticipated or curtail certain of its planned
activities. The Company may determine, depending on the
opportunities available to it, to seek additional equity or
debt financing to fund the cost of its operations. There can be
no assurance that additional financing will be available to the
Company on commercially reasonable terms, or at all. In the
event that the Company is unable to raise additional funds, the
Company could be required to either substantially reduce or
terminate its operations.
11
<PAGE>
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings
NONE
ITEM 2. Changes 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. Exhibits and Reports on Form 8-K
NONE
12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused the Report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: September 13, 1999 PTN Media, Inc.
By: /s/ Peter Klamka
--------------------------------
Chief Executive Officer and
Principal Accounting Officer
13
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the
consolidated financial statements for the six months ended June 30, 1999 and is
qualified in its entirety by reference to such statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 54,258
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 54,258
<PP&E> 22,846
<DEPRECIATION> 2,967
<TOTAL-ASSETS> 74,827
<CURRENT-LIABILITIES> 1,136,704
<BONDS> 0
3,440
0
<COMMON> 24
<OTHER-SE> (1,065,341)
<TOTAL-LIABILITY-AND-EQUITY> 74,827
<SALES> 13,216
<TOTAL-REVENUES> 13,216
<CGS> 43,923
<TOTAL-COSTS> 43,923
<OTHER-EXPENSES> 334,129
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 32,475
<INCOME-PRETAX> (397,311)
<INCOME-TAX> 0
<INCOME-CONTINUING> (397,311)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (397,311)
<EPS-BASIC> (.12)
<EPS-DILUTED> (.12)
</TABLE>
