U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000
[ ] TRANSITIONAL REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 (No Fee Required)
Commission File No. 0-26351
DIGS, Inc.
--------------------------------------------------------
(Name of Small Business Issuer in its Charter)
Delaware 95-4603237
- ----------------------------------- ------------------------
(State or other jurisdiction of (I.R.S Employer
incorporation of organization) Identification No.)
17327 Ventura Boulevard, Suite 200, Encino, California 91316
-----------------------------------------------------------------------------
Address of principal executive office
(818) 995 - 3650
----------------------------------
Issuer's telephone number
Check whether the issuer has (1) filed all reports required by Section 12 or
15(d) of the Exchange Act during the past 12 months, and (2) been subject to
such filing requirements for the past ninety (90) days. Yes ( X ) No ( )
As of March 31, 2000, 6,658,631 shares of the registrant's common stock
were outstanding.
The aggregate market value of the voting stock held by non-affiliates
computed by reference to the price at which the stock was sold, or the average
bid and asked prices of such stock, as of May 18, 2000 was $16,247,0059.
<PAGE>1
DIGS, INC. AND SUBSIDIARIES
<TABLE>
<S> <C>
INDEX
Pages
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PART 1: FINANCIAL INFORMATION
ITEM 1 - Financial Statements
Independent Accountants' Report 2
Consolidated Balance Sheet (Unaudited) as of March 31, 2000 3
Consolidated Statements of Operations (Unaudited)
For the Three Months Ended March 31, 2000 and 1999 4
Consolidated Statements of Cash Flow (Unaudited)
For the Three Months Ended March 31, 2000 and 1999 5
Selected Information - Substantially All Disclosures Required by Generally
Accepted Accounting Principles are Not Included 6-9
ITEM 2 - Management's Discussion And Analysis Of Financial Condition And
Results Of Operations 10-11
</TABLE>
<PAGE>2
INDEPENDENT ACCOUNTANTS' REPORT
May 17, 2000
To The Board of Directors and Stockholders of
DIGS, Inc. and Subsidiaries
Encino, California
We have reviewed the accompanying condensed consolidated balance sheet of DIGS,
Inc. and Subsidiaries as of March 31, 2000 and the related condensed
consolidated statements of income and cash flows for the three-months then
ended. These financial statements are the responsibility of the Corporation's
management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and of making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with generally accepted auditing standards, the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to such condensed consolidated financial statements for them to be in
conformity with generally accepted accounting principles.
The financial statements for the three-months ended March 31, 1999 have not been
reviewed by us, and accordingly, we express no opinion or other form of
assurance on them.
/s/ CALDWELL, BECKER, DERVIN, PETRICK & CO., L.L.P.
Woodland Hills, California
<PAGE>3
DIGS, INC. AND SUBSIDIARIES
PART 1: FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEET
MARCH 31, 2000
(UNAUDITED)
ASSETS
<TABLE>
<S> <C>
CURRENT ASSETS
Cash $ 1,658,473
Loan receivable - officer 50,558
Other 263,797
-------------------
Total Current Assets 1,972,828
PROPERTY AND EQUIPTMENT,
net of accumulated depreciation 179,380
PROGRAM DEVELOPMENT COSTS,
net of accumulated amortization 154,376
-------------------
Total Assets $ 2,306,584
===================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES $ 39,479
-------------------
STOCKHOLDERS' EQUITY
Preferred stock, par value $.01 per share; 20,000,000
shares authorized, 2,500 shares issued and
outstanding 25
Common stock, par value $.001 per share; 80,000,000
shares authorized, 6,658,631 shares issued and
outstanding 6,659
Additional paid-in capital 3,712,569
Accumulated other comprehensive income 20,378
Retained (deficit) (1,472,526)
-------------------
Total Stockholders' Equity 2,267,105
-------------------
Total Liabilities and Stockholders' Equity $ 2,306,584
===================
</TABLE>
See Accompanying Selected Information to Unaudited Consolidated Financial
Statements
<PAGE>4
DIGS, INC. AND SUBSIDIARIES
PART 1: FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
(UNAUDITED)
<TABLE>
<S> <C> <C>
For the Three Months Ended
March 31,
-------------------------------
2000 1999
------------- ----------------
REVENUE $ 214,280 $ 291,964
COST OF SALES 71,113 26,009
------------- --------------
Gross Profit 143,167 265,955
------------- --------------
OPERATING EXPENSES
Accounting 27,004 10,678
Legal 31,390 35
Marketing 29,368 64,118
Outside services 7,300 30,500
Payroll expenses 123,886 66,150
Other 75,646 68,355
------------- --------------
Total Operating Expenses 294,594 239,836
------------- --------------
Income (Loss) From Operations (151,427) 26,119
OTHER INCOME (EXPENSE) (801) 1,950
------------- --------------
Income (Loss) Before Income Taxes (152,228) 28,069
(PROVISION) FOR INCOME TAX (800) (800)
------------- --------------
Net Income (Loss) (153,028) 27,269
OTHER COMPREHENSIVE INCOME, net of tax;
Unrealized holding gain arising during period 23,125 --
Add reclassification adjustment for (loss) included in
net income -- 7,850
------------- --------------
Comprehensive Income (Loss) $ (129,903) $ 35,119
============= ==============
Income (Loss) per common share and common share
equivalent $ (0.02) $ .01
============= ==============
Weighted average common shares outstanding 6,649,864 5,272,280
============= ==============
</TABLE>
See Accompanying Selected Information to Unaudited Consolidated Financial
Statements
<PAGE>5
DIGS, INC. AND SUBSIDIARIES
PART 1: FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
(UNAUDITED)
<TABLE>
<S> <C> <C>
2000 1999
--------------------- -------------------
CASH FLOWS PROVIDED (USED) BY OPERATING ACTIVITIES:
Net income (loss) $ (153,028) $ 27,269
Adjustments to reconcile net (loss) to net cash provided
(used) by operating activities:
Amortization and depreciation 14,043 7,902
(Increase) in accounts receivable (55,020) (199,828)
(Decrease) in current liabilities and accrued expenses (48,662) (19,369)
Realized loss on sale of marketable equity securities -- 7,850
(Increase) in deposits (922) --
(Decrease) in deferred rent credit (5,000) (5,001)
--------------------- -------------------
Net Cash Flows (Used) by Operating Activities (248,589) (181,177)
--------------------- -------------------
CASH FLOWS PROVIDED (USED) BY INVESTING ACTIVITIES:
Acquisition of property and equipment (49,906) (7,475)
(Increase) in program development cost (59,127) (13,500)
(Increase) in loan receivable - officer (20,000) --
Sale of marketable equity securities -- 1,150
------------------- -------------------
Net Cash Flows (Used ) by Investing Activities (129,033) (19,825)
------------------- -------------------
CASH FLOWS PROVIDED (USED) BY FINANCING ACTIVITIES:
Proceeds from issuance of preferred stock 2,230,000 --
Proceeds from issuance of short-term debt 150,000 --
Proceeds from short-term loan - officer 30,000 --
Principal payment of short-term loan - officer (30,000) --
Principal payment of short-term debts (450,000) --
------------------- -------------------
Net Cash Flows Provided by Financing Activities 1,930,000 --
------------------- -------------------
NET INCREASE (DECREASE) IN CASH 1,552,378 (201,002)
CASH AT THE BEGINNING OF THE YEAR 106,095 515,920
------------------- -------------------
CASH AT THE END OF THE PERIOD $ 1,658,473 $ 314,918
=================== ===================
ADDITIONAL DISCLOSURES:
Interest paid $ 6,147 $ --
=================== ===================
Income taxes paid $ 800 $ 800
=================== ===================
</TABLE>
See Accompanying Selected Information to Unaudited Consolidated Financial
Statements
<PAGE>6
DIGS, INC. AND SUBSIDIARIES
SELECTED INFORMATION
Substantially All Disclosures Required By Generally Accepted Accounting
Principles are Not Included
MARCH 31, 2000
NOTE 1 - MANAGEMENT'S STATEMENT
In the opinion of the management, the accompanying unaudited financial
statements contain all adjustments (all of which are normal and recurring in
nature) necessary to present fairly the financial position of DIGS, Inc. and
Subsidiaries (the Company) at March 31, 2000, and the results of operations and
cash flows for the quarter ended March 31, 2000.
The notes to the Consolidated Financial Statements that are incorporated by
reference into the 1999 Form 10-KSB should be read in conjunction with these
Consolidated Financial Statements.
NOTE 2 - USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect certain reported amounts and disclosures. Accordingly, actual results
could differ from those estimates.
NOTE 3 - PRIVATE PLACEMENT OF PREFERRED STOCK
On March 14, 2000, the Company completed a private placement (the Placement) of
2,500 shares of the Company's Series "A" Convertible Preferred Stock, par value
$.01 per share and warrants to purchase 40 shares of common stock for each share
of preferred stock. The net proceeds to the Company from the sale, after
underwriting costs, are approximately $2,230,000. In connection with the sale of
preferred stock and issuance of warrants, the Company registered with the SEC
1,175,000 shares of common stock on April 19, 2000.
In addition the Company will issued to the underwriter 200,000 warrants to
purchase the Company's common stock at the exercise price equal to 110% of the
closing bid price of the common stock on the closing date.
A portion of the net proceeds was used to repay a short-term loan in the amount
of $450,000, which as of March 14, 2000 had a balance of $450,000. The loan
carried an annual interest rate of 5% per annum. The Company also used $30,000
of the proceeds to pay-off a short-term loan from an officer. The remaining
balance of the net proceeds, including any additional proceeds received upon
exercise of the warrants, will be added to working capital, of which a portion
will be used to pay operating expenses, program development costs and any
necessary capital expenditures.
NOTE 4 - SHAREHOLDERS' EQUITY
Common Stock
In connection with the Placement discussed in Note 3, the Company issued 100,000
new warrants to the buyers of the Convertible Preferred Stock and 200,000 new
warrants to the underwriters. Each new warrant may be converted into one share
of new common stock at an exercise price equal to 110% of the closing bid price
of the common stock on the closing date. The warrants expire on May 13, 2003. At
March 31, 2000, there were 300,000 warrants outstanding.
<PAGE>7
DIGS, INC. AND SUBSIDIARIES
SELECTED INFORMATION
Substantially All Disclosures Required By Generally Accepted Accounting
Principles are Not Included
MARCH 31, 2000
NOTE 4 - SHAREHOLDERS' EQUITY (CONTINUED)
Preferred Stock
In connection with the Placement discussed in Note 3, the Company has 2,500
shares of Series "A" Convertible Preferred Stock, par value of $0.01 outstanding
as of March 31, 2000. The preferred shares are convertible, in whole or in part,
at the option of the holders thereof, into non-assessable shares of common
stock. Upon conversion, the number of common stock received for each preferred
share will be calculated by dividing conversion amount by the conversion price.
Conversion amount is the sum of accrued and unpaid dividends and the stated
value, which is $1,000 per preferred share. The conversion price would be either
125% of the closing bid price on the issuance date, or the average of 75% of the
lowest closing bid price of the common stock during any three (3) trading days
during the twenty (20) consecutive trading days ending on and including any date
of determination, whichever is lower.
Holders of the preferred shares are entitled to receive cumulative cash
dividends at the annual rate of 6% when the shares are converted. At the option
of the holders, dividends may be paid in shares of common stock or in cash. The
preferred shares mature on May 13, 2003.
Holders of the preferred shares have no voting rights, except as required by
law, including but not limited to the General Corporation Law of the State of
Delaware. All preferred shares rank senior to the common stock. The preferred
shares have liquidation preference that equal the sum of the stated value and
any accrued and unpaid dividends. The preferred shares are redeemable, at the
option of the Company, for consideration equal to 120% of the liquidation
preference.
The following is an analysis of activities in the Stockholders' Equity for the
three months ended March 31, 2000:
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Comp-
Preferred Common Stock Additional rehensive
----------------- --------------------- Paid-In Income Retained
Shares Amount Shares Amount Capital (Loss) (Deficit) Balance
------ ------- ----------- --------- ------------- ----------- -------------- -----------
Balance at 12/31/99 -- -- 6,658,631 $ 6,659 $ 1,482,594 $ (2,747) $ (1,319,498) $ 167,008
March 14, 2000
Preferred stock issued 2,500 25 -- -- 2,229,975 -- -- 2,230,000
March 31, 2000
Unrealized -- -- -- -- -- 23,125 -- 23,125
holding gain
Net (loss) -- -- -- -- -- -- (153,028) (153,028)
------ ------- ----------- --------- ------------- ----------- -------------- -----------
Balance at 3/31/00 2,500 $ 25 6,658,631 $ 6,659 $ 3,712,569 $ 20,378 $ (1,472,526) $2,267,105
====== ======= =========== ========= ============= ============ ============= ===========
</TABLE>
NOTE 5 - STOCK OPTION PLANS
The Company has elected to follow the Accounting Principles Board Opinion (APBO)
No. 25, "Accounting for Stock Issued to Employees, "and to provide the
disclosures required under Statement of Financial Standards (SFAS) No. 123,
"Accounting for Stock-Based Compensation." In electing to follow APBO No. 25,
the Company does not recognize any compensation expense related to the granting
of any stock options, as no options are granted at a price below the market
price on the date of grant.
<PAGE>8
DIGS, INC. AND SUBSIDIARIES
SELECTED INFORMATION
Substantially All Disclosures Required By Generally Accepted Accounting
Principles are Not Included
MARCH 31, 2000
NOTE 5 - STOCK OPTION PLANS (CONTINUED)
The Company's 1999 stock option plan provides incentive stock options and
nonqualified stock options to purchase common stock. The options may be granted
to directors, officers, key employees, consultants and subsidiaries. The
exercise price can be up to 110% of market price at the date of grant.
Generally, options are exercisable in equal installments over three years from
the date of grant and expire five to ten years from the date of grant. As of
March 31, 1999, the maximum of 750,000 shares were approved to be issued under
the plan, of which 350,000 shares were available for future plans.
Presented below is a summary of stock option plan activity for the period shown:
<TABLE>
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Weight-
Average
Stock Options Exercise Price
--------------- ----------------
Outstanding at December 31, 1999 295,000 $5.17
Granted 105,000 5.00
Exercised -- --
Forfeited -- --
Expired -- --
---------------- ----------------
Outstanding at March 31, 2000 400,000 $5.13
================ ================
Shares exercisable at March 31, 2000 98,333 $5.17
================ ================
</TABLE>
Exercise prices for options outstanding as of March 31, 2000 range from $5.00 to
$5.50. The following table summarizes information for options outstanding and
exercisable at March 31, 2000:
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Options Outstanding Options Exercisable
------------------------------------------- ---------------------------
Weighted
Weight- Average Weight-
Stock Average Remaining Stock Average
Exercise Options Exercise Contractual Options Exercise
Prices Outstanding Price Life Exercisable Price
-------------------- ------------- ------------- ------------- ------------- -------------
$5.00 300,000 $5.00 2.39 65,000 $5.00
$5.50 100,000 $5.50 1.75 33,333 $5.50
------------- -------------
400,000 98,333
============= =============
</TABLE>
In electing to continue to follow APBO No. 25 for expense recognition purposes,
the Company is obliged to provide the expanded disclosures required under SFAS
No. 123 for stock-based compensation granted in 2000. Had compensation expense
for the stock options been recognized based on the fair value on the grant date
under the methodology prescribed by FAS 123, the company would require to
present the proforma net income and earnings per share for the three months
ended March 31, 2000, if there is any materially different.
Because the weighted-average fair values at date of granted were the same as the
market values during the three months ended March 31, 2000, the Company's net
income and earnings per share will be the same as the proforma net income and
earnings per share. Therefore, the Company's proforma information had not been
presented.
<PAGE>9
DIGS, INC. AND SUBSIDIARIES
SELECTED INFORMATION
Substantially All Disclosures Required By Generally Accepted Accounting
Principles are Not Included
MARCH 31, 2000
NOTE 5 - STOCK OPTION PLANS (CONTINUED)
The weighted-average fair value at the date of grant for options granted during
the period ended March 31, 2000, was $5.00, and was estimated using the
Black-Scholes option valuation model with the following weighted-average
assumptions:
2000
----------
Expected life in years 5
Interest Rate 5.0%
Volatility 33.0%
Dividend Yield 0%
NOTE 6 - SEGMENT INFORMATION
Information concerning operations in different lines of business for the three
months ended March 31, 2000 is presented below. Prior to August of 1999, the
Company operated in one business segment; public relation CD-ROM. In August of
1999, the company operated in public relation CD-ROM products and graphic design
within the United States. Intercompany transactions between segments are not
material.
<TABLE>
<S> <C> <C> <C>
CD-ROM
Design and Graphic
2000 Development Design Consolidated
- ------------------------------------- --------------- -------------- ---------------
Net Operating Revenues $ 6,550 $ 207,730 $ 214,280
Operating Income (241,819) 88,791 (153,028)
Identifiable Operating Assets 2,089,837 165,107 2,254,944
Depreciation and Amortization $ 13,516 $ 527 $ 14,043
</TABLE>
Identifiable operating assets include cash, available-for-sale securities, trade
accounts receivable, and fixed assets.
NOTE 7 - EARNINGS PER SHARE
Fully diluted per share data is not presented, as the effects would be
antidilutive.
<PAGE>10
DIGS, INC. AND SUBSIDIARIES
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
COMPUTATION OF NET INCOME PER COMMON SHARES
FINANCIAL CONDITION
The financial condition of the Company greatly improved during the first
quarter of 2000. The most apparent improvement being the increased strength of
the Company's balance sheet. The improvement in the Company's balance sheet
strength at March 31, 2000 as compared to December 31, 1999 is due to the sale
of 2,500 shares of convertible preferred stock that provided the Company with
$2,230,000 of cash. This cash allowed the Company to pay all of its short-term
debt as well as other accrued expenses. The remaining cash and elimination of
short-term debt leaves the Company extremely liquid.
During the quarter ended March 31, 2000, cash used for operating activities
was $248,589 and cash used for capital expenditures was $129,033. The cash used
for operations is a result of a net operating loss but also an increase in
accounts receivables and a decrease in accounts payable. Cash used for investing
activities consisted of $49,906 for property and equipment, $59,127 in program
development costs and $20,000 in advances. The Company expanded its corporate
office to accommodate its growing staff while continuing to develop and refine
the iVideoNow! player. Net cash proceeds from financing activities was
$1,930,000 and is a result of the sale of convertible preferred stock as well as
the payment of all short-term debt.
RESULTS OF OPERATIONS
The Company's operations during the quarter ended March 31, 2000 resulted
in a loss of $129,903 as compared to a gain of $35,119 during the same quarter
ended March 31, 1999. The difference in operating results between the
comparative quarters is due to a slight decrease in revenues and an increase in
operating costs.
Revenues
Revenues for the quarter ended March 31, 2000 decreased to $214,280 from
$291,964 for the same quarter in 1999. The consolidated revenue decrease is the
result of a drop in sales volumes of CD-ROM products by the Company's
subsidiary, Digital Corporate Profiles (DCP). However, this decrease was offset
by a significant increase in services performed by the Company's graphic design
subsidiary, DXF Design. DXF Design had its most productive quarter since its
formation in the middle of 1999.
Cost of Sales and Operating Expenses
Cost of sales as a percent of revenue decreased to 33% during the quarter
ended March 31, 2000 as compared to 9% in the same quarter of 1999. The decrease
is a result of a change in consolidated product mix as the services performed by
DXF Design became a larger portion of the consolidated revenue. As a result, the
Company's gross profit decreased to $143,167 or 67% of revenue during the
quarter ended March 31, 2000 from $265,955 or 91% of revenue during the same
quarter of 1999.
Operating expenses during the quarter ended March 31, 2000 increased to
$294,594 as compared to $239,836 during the same quarter ended 1999. The most
significant operating expense increase is for payroll. The Company has expanded
its current staff of programmers, graphic designers and administrators to
accommodate and guide the growth of the Company. Legal costs increased during
the quarter as a result of the Company retaining outside counsel to consult and
review the terms regarding the private placement of preferred stock and the
registration of any securities connected with the private placement.
<PAGE>11
DIGS, INC. AND SUBSIDIARIES
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
COMPUTATION OF NET INCOME PER COMMON SHARES
OUTLOOK
The Company's emphasis continues to be on effectively marketing and
enhancing its current products and services while researching potential new
products. New product development, such as the iVideoNow! player, is targeted
towards the business to business market and complement the Company's current
business to business products. The strength of the Company's balance sheet,
combined with revenues, should allow for more aggressive marketing of current
products as well as aggressive development of potential new products.
<PAGE>12
PART II. OTHER INFORMATION
Item 5. Other Information
On April 27, 2000, shareholders holding a majority of voting power approved the
name change of the Company from DIGS, Inc. to iVideoNow.com, Inc. The name
change to iVideoNow.com, Inc. is more descriptive of the Company's business and
will align the name of the Company more closely with the technical, internet and
media industries in which the Company operates. The notices are scheduled to be
sent to shareholders on or before May 24, 2000. The Company expects the name
change to be effective approximately 20 days after notices are sent to the
shareholders.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
None
(b) Reports on Form 8-K.
None
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
DIGS, INC.
Dated: May 19, 2000 By: PETER B. DUNN
------------------------
Peter B. Dunn, President
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FORM
10-QSB FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000, FOR DIGS, INC. AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-2000
<CASH> 1,658,473
<SECURITIES> 140,000
<RECEIVABLES> 122,715
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,972,828
<PP&E> 214,884
<DEPRECIATION> 60,508
<TOTAL-ASSETS> 2,306,584
<CURRENT-LIABILITIES> 39,479
<BONDS> 0
0
25
<COMMON> 6,659
<OTHER-SE> 2,267,105
<TOTAL-LIABILITY-AND-EQUITY> 2,306,584
<SALES> 214,280
<TOTAL-REVENUES> 214,280
<CGS> 71,113
<TOTAL-COSTS> 437,761
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,801
<INCOME-PRETAX> 0
<INCOME-TAX> 800
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (129,903)
<EPS-BASIC> (0.02)
<EPS-DILUTED> 0.00
</TABLE>
