UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[ 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
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
- -------------------------------------------------------------------------------
Commission File Number: 0-1665
- -------------------------------------------------------------------------------
DCAP GROUP, INC.
- -------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Delaware 36-2476480
- -------------------------------------------------------------------------------
(State or other jurisdiction of incorporation (I.R.S Employer
or organization) Identification No.)
90 Merrick Avenue, East Meadow, New York 11554
- -------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(516) 794-6300
- -------------------------------------------------------------------------------
(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 requirements for the past 90 days. ( X ) Yes
( ) No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. ( )Yes ( ) No
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date: 14,306,676 shares as of
April 30, 2000
<PAGE>
INDEX
DCAP GROUP, INC. AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheet - March 31, 2000 (Unaudited)
Condensed Consolidated Statements of Operations - Three months
ended March 31, 2000 and 1999 (Unaudited)
Condensed Consolidated Statements of Cash Flows - Three months
ended March 31, 2000 and 1999 (Unaudited)
Notes to Condensed Consolidated Financial Statements - Three
months ended March 31, 2000 and 1999 (Unaudited)
Item 2. Management's Discussion and Analysis or Plan of Operation
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
2
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
DCAP GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)
March 31, 2000
--------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 1,111,783
Accounts receivable, net 483,063
Prepaid expenses and
other current assets 196,575
-----------
Total current assets 1,791,421
-----------
PROPERTY AND EQUIPMENT, net 1,394,166
-----------
OTHER ASSETS:
Receivable from stockholders 225,000
Goodwill, net 3,721,978
Other intangibles 547,221
Deposits and other assets 454,082
----------
Total other assets 4,948,281
----------
$ 8,133,868
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 1,526,085
Current portion of long-term debt 54,000
Current portion capital lease obligations 274,982
Debentures payable 154,200
-----------
Total current liabilities $ 2,009,267
-----------
OTHER LIABILITIES:
Long-term debt 256,625
Capital lease obligations 260,164
Deferred revenue 41,026
----------
Total other liabilities 557,815
-----------
MINORITY INTEREST 472,562
-----------
STOCKHOLDERS' EQUITY:
Common Stock, $.01 par value; authorized,
25,000,000 shares; issued and outstanding,
14,306,676 shares 143,067
Capital in excess of par 9,760,023
Deficit (4,580,866)
-----------
5,322,224
Subscription receivable (228,000)
------------
$5,094,224
$8,133,868
See notes to condensed consolidated financial statements.
3
<PAGE>
DCAP GROUP INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three months ended
March 31,
2000 1999
----------- -----------
Revenues:
Commissions & Fees $ 2,128,633 $ 799,499
Rooms 285,683 279,758
Other 6,308 8,100
Interest 13,907 18,981
------ ------
Total revenues 2,434,531 1,106,338
--------- ---------
Costs and expenses:
General and administrative 2,057,694 842,873
Departmental 80,103 99,758
Depreciation and amortization 215,436 38,914
Interest 31,754 7,086
Lease rentals 58,265 56,908
Property operation
and maintenance 6,684 6,087
Provision for bad debt 600 600
--- ---
2,450,536 1,052,226
(Loss) income before income taxes
and minority interest (16,005) 54,112
Provision for income taxes 9,087 9,537
----- -----
(Loss) income before minority interest (25,092) 44,575
Minority interest ( 8,494) 10,970
- ----- ------
Net (loss) income $ (16,598) $ 33,605
========== ==========
Net (loss) income per common share:
Basic $ .00 $ .00
============= ==========
Diluted $ .00 $ .00
============= ==========
Weighted average number of shares outstanding
Basic 14,306,676 7,746,430
========== =========
Diluted 14,306,676 7,746,430
========== =========
See notes to condensed consolidated financial statements.
4
<PAGE>
DCAP GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended
March 31,
2000 1999
----------- ---------
<S> <C> <C>
Cash flows from operating activities:
Net (loss) income $ (16,598) $ 33,605
Adjustments to reconcile net (loss) income to
net cash provided by operating activities:
Depreciation and amortization 215,436 38,914
Provision for bad debts 600 -
Minority interest in net earnings ( 8,494) 10,970
Decrease (increase) in assets:
Accounts receivable 46,324 (39,110)
Prepaid expenses and other
current assets (28,614) 128,066
Deposits and other 93,396 (105,589)
Increase (decrease) in liabilities:
Accounts payable and accrued expenses 21,869 117,452
Deferred revenue - (6,903)
------- ------
Net cash provided by
operating activities 323,919 177,405
------- -------
Cash flows from investing activities:
Decrease (increase) in notes and other
receivables, net 21,511 (1,258,038)
Acquisition of property and equipment (75,261) (20,494)
Other - (7,299)
------- ------
Net cash used in
investing activities (53,750) (1,285,831)
------- ----------
Cash flows from financing activities:
Proceeds from issuance of stock - 1,118,718
Principal payment of long-term
debt and capital lease obligations (101,562) (20,000)
-------- -------
Net cash (used in) provided by
financing activities (101,562) 1,098,718
======== =========
Net increase (decrease) in cash and
cash equivalents 168,607 (9,708)
Cash and cash equivalents,
beginning of period 943,176 353,431
------- -------
Cash and cash equivalents,
end of period $1,111,783 $ 343,723
========== ==========
</TABLE>
See notes to condensed consolidated financial statements.
5
<PAGE>
DCAP GROUP, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 2000 AND 1999 (UNAUDITED)
1. The Condensed Consolidated Balance Sheet as of March 31, 2000, the
Condensed Consolidated Statements of Operations for the three months ended
March 31, 2000 and 1999 and the Condensed Consolidated Statements of Cash
Flows for the three months ended March 31, 2000 and 1999 have been prepared
by the Company without audit. In the opinion of the Company, the
accompanying unaudited condensed consolidated financial statements contain
all adjustments necessary to present fairly its financial position as of
March 31, 2000, results of operations for the three months ended March 31,
2000 and 1999 and cash flows for the three months ended March 31, 2000 and
1999. This report should be read in conjunction with the Company's Annual
Report on Form 10-KSB for the year ended December 31, 1999.
2. Summary of Significant Accounting Policies:
------------------------------------------
a. Principles of consolidation
The accompanying consolidated financial statements include the accounts
of all subsidiaries in which the Company exercises significant
influence over all decision making related to the ongoing major
operations. All significant intercompany accounts and transactions have
been eliminated.
b. Revenue recognition
The Company recognizes commission revenue from insurance policies at
the beginning of the contract period, on income tax preparation when
the services are completed and on automobile club dues equally over the
contract period. Franchise fee revenue is recognized when substantially
all the Company's contractual requirements under the franchise
agreement are completed. Refunds of commissions on the cancellation of
insurance policies are reflected at the time of cancellation. Premium
financing fee revenue is recognized when financing is provided to the
insured.
Revenues from room sales are recorded at the time services are performed.
3. The results of operations and cash flows for the three months ended
March 31, 2000 are not necessarily indicative of the results to be expected
for the full year.
4. DCAP Acquisition: Pro Forma Information. Since February 25, 1999, the
Company has been engaged in two lines of business. In one, the Company,
through its wholly-owned subsidiary, DCAP Insurance Agencies, Inc.
(formerly Dealers Choice Automotive Planning Inc.) ("DCAP"), and related
entities (collectively, the "DCAP Companies") is engaged primarily in
placing various types of insurance, including automobile, motorcycle, boat,
life, business and homeowner's insurance, and excess coverage, with
insurance underwriters on behalf of its customers. In addition, the DCAP
Companies offer income tax return preparation services, automobile club
services for roadside emergencies and premium financing services for their
customers. The Company has been in this business since its February 25,
1999 acquisition of the DCAP Companies.
In its other line of business, the Company, through its wholly-owned
subsidiary, IAH, Inc.,
6
<PAGE>
operates the International Airport Hotel in San Juan, Puerto Rico (the
"Hotel"). The Hotel caters generally to commercial and tourist travelers in
transit.
As indicated above, on February 25, 1999, the Company acquired all of the
outstanding stock of DCAP as well as interests in the other DCAP Companies.
This transaction was accounted for under the purchase method of accounting.
Accordingly, the Company's condensed consolidated statements of operations
include the revenues and expenses of the DCAP Companies from February 25,
1999.
During 1999, the Company also acquired the interests of its joint venture
partners in various DCAP retail insurance stores. These transactions have
been accounted for under the purchase method of accounting.
The following pro forma results were developed assuming that the
acquisition of the DCAP Companies and the joint venture interests had
occurred as of January 1, 1999. The Company's actual results for the three
months ended March 31, 2000 are also reflected below.
Three Months Ended
March 31,
-----------------------------
2000 1999
---- ----
(actual) (pro forma)
Revenues $2,434,531 $2,231,097
Net loss (16,598) (344,178)
Loss per share $ .00 $ (.02)
The pro forma net loss includes amortization of goodwill and other
purchased intangibles of $91,885 for the three months ended March 31, 1999.
The above unaudited pro forma condensed consolidated financial information
is presented for illustrative purposes only and is not necessarily
indicative of the condensed consolidated results of operations in future
periods or the results that actually would have been realized had the
Company and the DCAP Companies been a combined company during the specified
period or the joint venture interests had been acquired as of January 1,
1999.
5. Segment and Related Information. In 1999, the Company adopted SFAS No.
131, Disclosures About Segments of an Enterprise and Related Information,
which changes the way the Company reports information about its operating
segments. The Company has two business units with separate management teams
that provide different products and services.
Summarized financial information concerning the Company's reportable
segments is shown in the following table:
7
<PAGE>
Three months ended
March 31, 2000
DCAP
Companies Hotel Other(1) Total
--------- ----- -------- -----
Revenues $2,128,633 $292,549 $ 13,349 $2,434,531
Net income (loss) 50,859 57,922 (125,379) (16,598)
Three months ended
March 31, 1999
DCAP
Companies Hotel Other(1) Total
--------- ----- -------- -----
Revenues $ 799,499 $288,616 $ 18,223 $1,106,338
Net income (loss) 8,346 61,753 (36,494) 33,605
------------
(1) Column represents corporate-related items and, as it relates to
segment net income (loss), income and expense, including expenses for
amortization of goodwill and other intangibles ($91,885 for the three
months ended March 31, 2000), not allocated to reportable segments.
6. On February 25, 1999, concurrently with the acquisition of the DCAP
Companies, Eagle Insurance Company ("Eagle") purchased 1,486,893 Common
Shares of the Company for an aggregate purchase price of approximately
$1,000,000 or $.67 per share. Eagle is a New Jersey insurance company
wholly-owned by The Robert Plan Corporation, an insurance holding company
that is engaged in providing services to insurance companies.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
---------------------------------------------------------
THREE MONTHS ENDED MARCH 31, 2000 AND 1999
Background
During 1998 and prior to February 25, 1999, the sole business of DCAP
Group, Inc. (the "Company") was the operation, through a wholly-owned
subsidiary, IAH, Inc., of the International Airport Hotel in San Juan, Puerto
Rico (the "Hotel").
On February 25, 1999, the Company acquired all of the issued and
outstanding shares of Common Stock of DCAP Insurance Agencies, Inc. (formerly
Dealers Choice Automotive Planning Inc.) ("DCAP") as well as interests in
certain companies affiliated with DCAP (collectively with DCAP, the "DCAP
Companies"). The DCAP Companies are engaged primarily in placing various types
of insurance, including automobile, motorcycle, boat, life, business and
homeowner's insurance, and excess coverage, with insurance underwriters on
behalf of their customers. In addition, the DCAP Companies offer income tax
return preparation services, automobile club services for roadside emergencies
and premium financing services for their customers.
8
<PAGE>
The DCAP Companies are compensated for their insurance-related services by
commissions paid by insurance companies; the commission is usually a percentage
of the premium paid by the insured. The DCAP Companies do not engage in
underwriting activities and therefore do not assume underwriting risks.
There are 51 existing "DCAP" offices in the New York metropolitan area. As
discussed below, an additional 21 are anticipated to be opened in the near
future. Of the existing locations, 16 are wholly-owned by the Company, eight are
owned partially by the Company (ranging between 50% and 80%) and partially by
other persons who generally operate the location (the "joint venture partner")
and 27 are franchises in which the Company has no equity interest; the
franchisor, DCAP Management Corp., however, is wholly-owned by the Company.
During the last four months of 1999 and initial four months of 2000, the Company
sold an aggregate of 22 franchises. One of these opened for business in February
2000. It is anticipated that the remaining 21 franchised stores will open during
the second quarter of 2000 with the result that there would be 72 "DCAP"
locations. In April 1999, DCAP obtained a license from the State of Connecticut
to sell insurance in that state, and expects to begin placing policies there in
the future.
Concurrently with the closing of the DCAP acquisition, the Company issued
and sold to Eagle Insurance Company ("Eagle") 1,486,893 Common Shares for an
aggregate purchase price of approximately $1,000,000.
Eagle is a New Jersey insurance company wholly-owned by The Robert Plan
Corporation ("The Robert Plan"), an insurance holding company that is engaged in
providing services to insurance companies. Pursuant to separate agency
agreements between certain DCAP Companies and certain insurance company
subsidiaries of The Robert Plan, such DCAP Companies have been appointed agents
of the insurance companies with regard to the offering of automobile and other
insurance products.
In June 1999, the Company raised gross proceeds of $1,675,000 through a
private placement of its securities.
Pursuant to various agreements entered into by the Company in December
1999, the Company acquired the interests of its joint venture partners in 15
DCAP retail insurance stores, in exchange for the issuance of approximately
850,000 Common Shares of the Company. These acquisitions were part of the
Company's plan to phase out joint ventures in the DCAP system and to concentrate
on wholly-owned and franchise operations.
Results of Operations
The Company's net loss for the three months ended March 31, 2000 was
$16,598 as compared to a net income of $33,605 for the three months ended March
31, 1999. The results of operations for the three months ended March 31, 1999
included the results of operations of the DCAP Companies from February 25, 1999,
the date of the acquisition by the Company of the DCAP Companies. During the
three months ended March 31, 2000, revenues from the operations of the DCAP
Companies were $2,128,633 while Hotel revenues for such period were $292,549.
9
<PAGE>
The loss for the three months ended March 31, 2000 as compared to the three
months ended March 31, 1999 was the result primarily of amortization expenses of
$91,885 relating to goodwill and other intangible assets generated primarily by
the DCAP acquisition, which was accounted for under the purchase method of
accounting. The operations of the DCAP Companies during the three months ended
March 31, 2000, on a stand-alone basis, generated a net income of $50,859. The
operations of the Hotel during the three months ended March 31, 2000, on a
stand-alone basis, generated a net income of $57,922.
Liquidity and Capital Resources
As of March 31, 2000, the Company had $1,111,783 in cash and cash
equivalents and a working capital deficit of $217,846. As of December 31, 1999,
the Company had $943,176 in cash and cash equivalents and a working capital
deficit of $211,777.
Cash and cash equivalents increased between December 31, 1999 and March 31,
2000 due to net cash provided by operating activities in the amount of $323,919,
offset by cash used to acquire property and equipment of $75,261 and to repay
long-term debt and capital lease obligations of $101,562.
Other
In April 1999, DCAP obtained a license from the State of Connecticut to
sell insurance in that state. The Company is in the process of contacting
carriers and expects to begin placing policies in Connecticut in the near
future. The Company intends to add consumer finance products to its portfolio of
services and products, including auto loans and personal loans, personal lines
of credit, and extended auto warranty insurance, among others. These products
are expected to generate new revenues for DCAP.
In addition, an aggregate of 22 new franchises were sold in the last four
months of 1999 and the initial four months of 2000. One of these opened for
business in February 2000, and the Company anticipates that the remaining 21
franchised stores will open during the second quarter of 2000, which would bring
the total number of "DCAP" locations to 72.
Forward Looking Statements
Certain information contained in the matters set forth above are
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995, and is subject to the safe harbor created by that
act. The Company cautions readers that certain important factors may affect the
Company's actual results and could cause such results to differ materially from
any forward- looking statements which may be deemed to have been made above and
elsewhere in this Quarterly Report or which are otherwise made by or on behalf
of the Company. For this purpose, any statements contained above and elsewhere
in this Quarterly Report that are not statements of historical fact may be
deemed to be forward-looking statements. Without limiting the generality of the
foregoing, words such as "may," "will," "expect," "believe," "anticipate,"
"intend," "could," "estimate," or "continue" or the negative variations of those
words or comparable terminology are intended to identify forward-looking
statements. Factors which may affect the Company's results include, but are not
limited to, the risks and uncertainties associated with undertaking different
lines of business, the lack of experience in operating certain new business
lines, the volatility of insurance
10
<PAGE>
premium pricing, government regulation, competition from larger, better financed
and more established companies, the possibility of tort reform and a resultant
decrease in the demand for insurance, the uncertainty of the litigation with
regard to the Hotel lease, the dependence on the Company's executive management,
and the ability of the Company to raise additional capital which may be required
in the near term. The Company is also subject to other risks detailed herein or
detailed from time to time in the Company's Securities and Exchange Commission
filings.
11
<PAGE>
PART II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
In November, 1996, an action was commenced in the United States District
Court for the Eastern District of Pennsylvania by Regent National Bank
("Regent") against DCAP and a wholly- owned subsidiary of the Company, Payments,
Inc., alleging that DCAP and Payments, Inc. breached a certain contract in
connection with Regent's agreement to provide funding to finance the purchase of
automobile insurance for customers of DCAP, Payments, Inc. and affiliated
agencies. Subsequently, Regent amended its pleading to add Kevin Lang and
Abraham Weinzimer, DCAP's principals, as defendants. Regent claims that the
defendants are liable to it for the losses Regent allegedly suffered as a result
of unpaid loans made through DCAP agencies. Regent claims damages in excess of
$800,000. DCAP and Payments, Inc. have interposed several affirmative defenses
and have asserted counterclaims against Regent for breach of contract and fraud.
DCAP and Payments, Inc. seek damages of $40,000. This matter has been placed on
the list of matters to be scheduled for trial, but no date has been set for a
trial. DCAP believes that it has meritorious defenses to Regent's claims and
intends to defend and pursue its counterclaim vigorously. In March 1997, DCAP,
Payments, Inc. and their affiliated agencies brought a separate action against
Regent, among others, in the Supreme Court of the State of New York alleging,
among other things, breach of contract, negligence and fraud and seeking damages
of at least $2,000,000 as well as punitive damages in the amount of $2,000,000.
Such action has been stayed pending the resolution of the Pennsylvania action.
Effective as of February 8, 2000, in consideration for the transfer of
certain contract rights, the Company issued 7,500 Common Shares to WISE Agency
Corp.
The above transaction was a private transaction not involving a public
offering and was exempt from the registration provisions of the Securities Act
pursuant to Section 4(2) thereof. The Company determined that the purchaser was
a sophisticated investor. The certificate representing such Common Shares bears
a restrictive legend permitting the transfer thereof only upon registration of
such securities or pursuant to an exemption from registration under the
Securities Act.
Item 3. DEFAULTS UPON SENIOR SECURITIES
None
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
Item 5. OTHER INFORMATION
None
12
<PAGE>
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
3(a) Certificate of Incorporation, as amended 1
3(b) By-laws, as amended2
27 Financial Data Schedule
(b) Reports on Form 8-K
No Current Report on Form 8-K was filed by the Company during the
quarter ended March 31, 2000.
--------
1 Denotes document filed as exhibits to the Company's Annual Reports on
Form 10-KSB for the years ended December 31, 1993 and 1998 and incorporated
herein by reference.
2 Denotes document filed as an exhibit to the Company's Annual Report on
Form 10-KSB for the year ended December 31, 1998 and incorporated herein by
reference.
13
<PAGE>
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.
DCAP GROUP, INC.
Dated: May 12, 2000 By: /s/ Kevin Lang
---------------------
Kevin Lang
President
Dated: May 12, 2000 By: /s/ Abraham Weinzimer
---------------------
Abraham Weinzimer
Executive Vice President
(Principal Financial Officer)
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
(Replace this text with the legend)
</LEGEND>
<CIK> 0000033992
<NAME> DCAP Group, Inc.
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<EXCHANGE-RATE> 1.000
<CASH> 1,111,783
<SECURITIES> 0
<RECEIVABLES> 536,000
<ALLOWANCES> 53,000
<INVENTORY> 0
<CURRENT-ASSETS> 1,791,421
<PP&E> 3,701,141
<DEPRECIATION> 2,306,975
<TOTAL-ASSETS> 4,948,281
<CURRENT-LIABILITIES> 2,009,269
<BONDS> 516,789
0
0
<COMMON> 143,067
<OTHER-SE> 4,951,157
<TOTAL-LIABILITY-AND-EQUITY> 5,094,224
<SALES> 0
<TOTAL-REVENUES> 2,434,531
<CGS> 0
<TOTAL-COSTS> 2,418,782
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 31,754
<INCOME-PRETAX> (7,511)
<INCOME-TAX> 9,087
<INCOME-CONTINUING> (16,598)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (16,598)
<EPS-BASIC> .00
<EPS-DILUTED> .00
</TABLE>
