<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 30, 1996
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 0-9897
SOLV-EX CORPORATION
(Exact name of Registrant as specified in its charter)
NEW MEXICO 85-0283729
(State or other jurisdiction of (IRS employer identification)
incorporation or organization)
500 MARQUETTE, NW, SUITE 300, ALBUQUERQUE, NM 87102
(Address of principal executive offices)
(505)-243-7701
(Registrant's telephone number, including area code)
Former name, former address and former fiscal year, if changed since last
report: None
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
COMMON, CAPITAL STOCK, $.01 PER VALUE
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 12, 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.
YES XX NO
---- ----
Indicate the number of shares outstanding of each of the Registrant's classes of
Common Stock, as of the latest practicable date: Common Stock, $.01 par value,
23,010,287 shares outstanding as of November 1, 1996.
<PAGE>
SOLV-EX CORPORATION
AND SUBSIDIARIES
(Development Stage Enterprises)
INDEX
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements:
Consolidated Balance Sheets,
September 30, 1996 and June 30, 1996 (Unaudited) 1
Consolidated Statements of Operations,
three months ended September 30, 1996 and 1995,
and Cumulative from Inception (Unaudited) 2
Consolidated Statements of Stockholders' Equity,
three months ended September 30, 1996 and
Cumulative from Inception (Unaudited) 3
Consolidated Statements of Cash Flows,
three months ended September 30, 1996 and 1995,
and Cumulative from Inception (Unaudited) 4-5
Notes to Consolidated Financial Statements
(Unaudited) 6-7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations. 8-11
PART II. OTHER INFORMATION
Item 6. There were no reports filed on Form 8-K during the
quarter ended September 30, 1996. An 8-K, dated
October 4, 1996, was filed October 11,1996,
reporting under Item 5 certain litigation.
Each other item of information required under Part II is inapplicable for the
quarter ended September 30, 1996.
(i)
<PAGE>
SOLV-EX CORPORATION AND SUBSIDIARIES
(DEVELOPMENT STAGE ENTERPRISES)
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 1996 AND JUNE 30, 1996
(UNAUDITED)
SEPTEMBER 30, JUNE 30,
ASSETS 1996 1996
- ------ ------------- ----------
Current assets:
Cash and cash equivalents $ 27,982,109 43,902,567
Accounts receivable 3,164,416 2,154,135
Deferred financing costs 1,077,915 1,067,285
Notes receivable - stockholder 1,534,950 1,534,950
Prepaid expenses 2,667,204 3,390,920
Other 67,069 44,358
------------ ----------
Total current assets 36,493,663 52,094,215
------------ ----------
------------ ----------
Property, plant and equipment, at cost:
Mineral lease 1,976,432 1,976,432
Pilot plant land 167,768 167,768
Buildings 4,542,822 2,774,171
Heavy Equipment 7,383,692 5,001,753
Field and laboratory equipment 2,537,927 2,124,058
Furniture, fixtures and leasehold
improvements 571,363 398,143
Construction in process 24,152,559 14,362,025
------------ ----------
41,332,563 26,804,350
Less accumulated depreciation
and amortization 1,365,127 1,078,871
------------ ----------
Net property, plant and equipment 39,967,436 25,725,479
------------ ----------
Patents, at cost, net of accumulated
amortization of $52,146
at September 30, 1996 and
$47,109 at June 30, 1996 368,820 364,081
Deferred financing costs 1,393,354 1,613,353
Other assets, at cost 808,730 369,710
------------ ----------
$ 79,032,003 80,166,838
------------ ----------
------------ ----------
SEPTEMBER 30, JUNE 30,
Liabilities and Stockholders' Equity 1996 1996
- ------------------------------------ ------------ ----------
Current liabilities:
Accounts payable and accrued expenses $ 4,501,196 4,468,605
Deferred compensation 99,000 99,000
Current installments of long-term debt 465,294 25,367
------------ ----------
Total current liabilities 5,065,490 4,592,972
------------ ----------
------------ ----------
Long-term debt, excluding current
installments 33,694,238 33,057,000
------------ ----------
Total liabilities 38,759,728 37,649,972
------------ ----------
------------ ----------
Stockholders' equity:
Common stock, $.01 par value
Authorized 30,000,000 shares;
22,913,402 issued and outstanding
shares at September 30,1996, and
22,846,649 at June 30, 1996 229,134 228,466
Additional paid-in capital 67,890,428 67,556,328
Unearned compensation (288,750) --
Deficit accumulated during development
stage (27,558,537) (25,267,928)
------------ -----------
Total stockholders' equity 40,272,275 42,516,866
------------ -----------
Commitments and contingencies
------------ -----------
$ 79,032,003 80,166,838
------------ -----------
------------ -----------
See accompanying notes to consolidated financial statements.
<PAGE>
SOLV-EX CORPORATION AND SUBSIDIARIES
(DEVELOPMENT STAGE ENTERPRISES)
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995,
AND CUMULATIVE FROM JULY 2, 1980 (INCEPTION)
(UNAUDITED)
THREE MONTHS ENDED CUMULATIVE
SEPTEMBER 30, FROM JULY 2, 1980
1996 1995 (INCEPTION)
----------- --------- -----------------
Revenues:
Contract fees $ -- -- 5,278,637
Interest 420,432 26,850 2,762,995
Gain on sale of equipment -- -- 15,078
State grant -- -- 407,760
----------- ---------- -----------
420,432 26,850 8,464,470
----------- ---------- -----------
Expenses:
Research and development 1,016,456 662,882 20,404,026
Research and development
funded by others -- (131,652) (2,032,956)
General and administrative 1,204,228 240,324 15,828,047
Interest expense, net of $501,250
capitalized during the period
ended 1996, and none during the
period ended 1995. 490,357 -- 490,357
Write-off of mineral lease -- -- 1,447,453
----------- ---------- -----------
2,711,041 771,554 36,136,927
----------- ---------- -----------
Minority interest in loss
of subsidiary -- -- 113,920
----------- ---------- -----------
Net (loss) $(2,290,609) (744,704) (27,558,537)
----------- ---------- -----------
----------- ---------- -----------
Weighted average number of
common shares outstanding 15,421,377 20,688,788 14,439,066
----------- ---------- -----------
----------- ---------- -----------
(Loss) per common share $ (0.15) (0.04) (1.91)
----------- ---------- -----------
----------- ---------- -----------
See accompanying notes to consolidated financial statements.
<PAGE>
SOLV-EX CORPORATION AND SUBSIDIARIES
(DEVELOPMENT STAGE ENTERPRISES)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM JULY 2, 1980 (INCEPTION)
THROUGH SEPTEMBER 30, 1996
(UNAUDITED)
<TABLE>
Common Deficit
stock accumulated
Price Common stock Additional Common subscrip- Unearned during
per ------------------- paid-in stock tions Compen- development
share Shares Amount capital subscribed receivable sation stage Total
--------- ---------- -------- ----------- ---------- ---------- --------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at June 30, 1996 22,846,649 $228,466 $67,556,328 $ -- $ -- $ -- $(25,267,928) $42,516,866
Unearned compensation -- -- 288,750 -- -- (288,750) -- --
Issued to individual as
compensation July 1,
1996 through September
30, 1996 4.92-8.00 25,653 257 179,868 -- -- -- -- 180,125
Issued to GFL Advantage
per private placement
agreement -- -- -- (282,487) -- -- -- -- (282,487)
Stock options exercised:
August 12, 1996 1.500 15,600 156 23,244 -- -- -- -- 23,400
September 3, 1996 2.560 500 5 1,275 -- -- -- -- 1,280
September 20, 1996 2.56-8.53 12,500 125 91,575 -- -- -- -- 91,700
September 24, 1996 2.560 12,500 125 31,875 -- -- -- -- 32,000
Net (loss) (2,290,609) (2,290,609)
---------- -------- ----------- ------- ------- --------- ------------ -----------
Balance at September 30,
1996 22,913,402 $229,134 $67,890,428 $ -- $ -- $(288,750) $(27,558,537) $40,272,275
---------- -------- ----------- ------- ------- --------- ------------ -----------
---------- -------- ----------- ------- ------- --------- ------------ -----------
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
SOLV-EX CORPORATION AND SUBSIDIARIES
(DEVELOPMENT STAGE ENTERPRISES)
CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
AND CUMULATIVE FROM JULY 2, 1980 (INCEPTION)
(UNAUDITED)
<TABLE>
Three Months Ended September 30, Cumulative
from July 2, 1980
1996 1995 (inception)
------------ ----------- -----------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $ (2,290,609) $ (744,704) (27,558,537)
Adjustments to reconcile net loss to net cash used
by operating activities:
Depreciation and amortization 500,660 45,058 1,870,237
Write-off of mineral lease and other -- -- 1,505,541
Gain on sale of equipment -- -- (15,078)
Issuance of stock, warrants, and options for
services performed 180,125 3,047 2,596,542
Minority interest in loss of subsidiary -- -- (113,920)
Changes in certain assets and liabilities:
Receivables and other assets (309,276) (142,652) (7,432,247)
Accounts payable and accrued expenses (249,896) (378,427) 4,209,489
Accrued deferred interest -- -- 167,260
Deferred compensation -- -- 370,250
------------ ----------- -----------
Net cash used by operating activities (2,168,996) (1,217,678) (24,400,463)
------------ ----------- -----------
Cash flows from investing activities:
Proceeds from short-term investments -- -- 2,296,745
Additions to property, plant and equipment (14,528,213) (1,211,993) (41,647,960)
Proceeds from sale of equipment -- -- 15,078
Expenditures for short-term investments -- -- (2,100,000)
Cash acquired in excess of payment for the purchase
of a majority interest in Can-Amera Oil Sands, Inc. -- -- 97,976
Expenditures for patents (9,776) (12,900) (415,662)
Expenditures for other (439,020) -- (695,589)
------------ ----------- -----------
Net cash used by investing
activities (14,977,009) (1,224,893) (42,449,412)
------------ ----------- -----------
Cash flows from financing activities:
Proceeds from issuance of long-term debt 1,154,630 20,346 35,669,912
Proceeds from issuance of common stock 148,380 3,429,340 63,375,902
Principal payments on short term and long-term debt (77,463) (12,910) (1,493,479)
Payment of costs associated with proposed financing -- (3,938) (2,738,726)
Other -- -- 18,375
------------ ----------- -----------
Net cash provided by financing activities 1,225,547 3,432,838 94,831,984
------------ ----------- -----------
Change in cash and cash equivalents $(15,920,458) $ 990,267 27,982,109
------------ ----------- -----------
------------ ----------- -----------
(continued)
</TABLE>
<PAGE>
SOLV-EX CORPORATION AND SUBSIDIARIES
(DEVELOPMENT STAGE ENTERPRISES)
CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
AND CUMULATIVE FROM JULY 2, 1980 (INCEPTION)
(UNAUDITED)
<TABLE>
Three Months Ended September 30, Cumulative
from July 2, 1980
1996 1995 (inception)
------------ ---------- -----------------
<S> <C> <C> <C>
Change in cash and cash equivalents, forwarded $(15,920,458) $ 990,267 27,982,109
Cash and cash equivalents at beginning of period 43,902,567 854,719 --
------------ ---------- ----------
Cash and cash equivalents at end of period $ 27,982,109 $1,844,986 27,982,109
------------ ---------- ----------
------------ ---------- ----------
Supplemental disclosure of cash flow information:
Interest paid (net of amounts capitalized) $ 1,607 $ 2,243 4,222,783
------------ ---------- ----------
------------ ---------- ----------
Noncash investing and financing activities:
Issuance of stock for minerals lease $ -- $ -- 281,000
------------ ---------- ----------
------------ ---------- ----------
Acquisition of controlling interest in
Can-Amera Oil Sands, Inc. for cash of $150,000 and 75,000
shares of common stock valued at $122,250. In conjunction
with the acquisition, liabilities were assumed as follows:
Fair value of assets acquired $ -- $ -- 1,659,211
Cash and stock paid for capital stock $ -- $ -- (272,250)
Minority interest $ -- $ -- (113,920)
------------ ---------- ----------
Liabilities assumed $ -- $ -- 1,273,041
------------ ---------- ----------
------------ ---------- ----------
Issuance of stock for deferred compensation $ -- $ -- 271,250
------------ ---------- ----------
------------ ---------- ----------
Issuance of subsidiary stock for redemption
of Can-Amera notes $ -- $ -- 1,447,980
------------ ---------- ----------
------------ ---------- ----------
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
SOLV-EX CORPORATION AND SUBSIDIARIES
(Development Stage Enterprises)
Notes to Consolidated Financial Statements
(Unaudited)
(1) BASIS OF NOTE PRESENTATION
The notes to the consolidated financial statements do not present all
disclosures required under generally accepted accounting principles but
instead, as permitted by Securities and Exchange Commission regulations,
presume that users of the interim financial statements have read or have
access to the June 30, 1996, audited consolidated financial statements and
that the adequacy of additional disclosure needed for a fair presentation may
be determined in that context.
Subsequent to filing the 10-Q for the period ended December 31, 1994, the
Company determined certain costs previously expensed as research and
development were properly capitalized as construction in process, as reported
at June 30, 1995. Other research and development expenditures continue to be
expensed. As a result, quarterly information reported herein reflect these
changes.
The oil sands plant being constructed at the Bitumount Lease is designed to
recover 14,000 barrels of bitumen per calendar day using four production
modules, at an estimated cost to complete of approximately $125 million. The
initial stage plant production is scheduled to begin operation during the
first quarter 1997, at a rate of about 100,000 barrels of bitumen per month
using a single production module, at an approximate capital cost of $70
million. Sufficient funds are available from both the Company and its 10%
joint venture partner, UTS, for this purpose. Based on the availability of
cash flow or third party financing, the capacity of the initial stage plant
will be expanded by installing and commissioning the additional production
modules to reach design capacity.
(2) ADJUSTMENTS
The accompanying consolidated interim financial statements include all
adjustments which are, in the opinion of management, necessary to fair
presentation of the consolidated results of operations for the periods
presented. All such adjustments are of a normal recurring nature.
-6-
<PAGE>
(3) DEPRECIATION, DEPLETION AND AMORTIZATION
Mineral leases are to be amortized, once recovery of minerals begin, using
the units-of-production method based on estimates of recoverable reserves.
(4) LEASE COMMITMENTS
The Company has leased certain facilities and heavy equipment under
agreements which are classified as operating leases. One lease for heavy
equipment has been classified as a capital lease. Most leases contain renewal
provisions.
At September 30, 1996, future minimum annual rental commitments under lease
obligations are as follows:
Capital Operating
Lease Lease
- ---------------------------------------------------------------------
June 30, 1997 $207,335 $713,846
June 30, 1998 207,335 492,350
June 30, 1999 207,335 405,049
June 30, 2000 207,335 245,360
June 30, 2001 -- --
Future Years -- --
(5) DEBT
The Company has entered certain debt financing, consisting of a capital
lease, referred to in Footnote 4 above, and certain short term insurance
premium financing with a balance of $256,286 as of September 30, 1996. The
insurance financing carries a Canadian annual rate of interest of 5.33
percent, and terminates in June, 1997.
(6) SUBSEQUENT EVENTS
Subsequent to September 30, 1996, the Company terminated a temporary verbal
arrangement to provide skilled and unskilled labor on a contract basis
payable monthly with Fort McKay Metis Corporation ("FMMC"), and hired
directly the local work force of more than 250 persons to continue work on
the Bitumount Lease. The termination of the arrangement resulted from the
Company's concern over unsubstantiated and excessive billing, and is seeking
a detailed review of invoices from FMMC. The Company has withheld certain
payments to FMMC pending resolution of its concerns over the computation and
propriety of billings. FMMC has filed a Cdn$3,825,388 lien against the
Company's oil sands lease as a result of the withheld payments. The Company
has retained legal counsel in Alberta to assist in resolving the situation
and has commenced litigation seeking a proper accounting for billings.
-7-
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
MATERIAL CHANGES IN FINANCIAL CONDITION, LIQUIDITY AND CAPITAL
RESOURCES
The Company's net working capital was $31,428,173 at September 30, 1996,
compared to working capital of $47,501,243 at June 30, 1996. Expenditures
approaching $15 million for property, plant and equipment account for the
vast majority of working capital used during the quarter ended September 30,
1996. Included in the $15 million is $9.8 million spent on site preparation,
detailed engineering and procurement associated with the construction of the
initial stage plant on the Bitumount Lease and $1.8 million for buildings
located on the Bitumount Lease. An additional $2.4 million has been spent to
acquire heavy equipment to be used in the construction efforts currently in
process and to be used in future mining efforts on the Company's Bitumount
Lease. The primary requirement for working capital is to fund the continuing
construction of these facilities and the acquisitions of heavy equipment and
processing equipment to be used in association with commercial oil sands
processing.
In an effort to maximize cashflow, certain debt financing, consisting of a
capital lease for heavy equipment and certain insurance premium financing was
entered into by the Company during the three months ended September 1996.
The heavy equipment, valued at approximately $829,000, for a term of four
years, and the insurance premiums financed a total in excess of $325,000, and
are financed for a period of less than one year.
Expenses of continued testing and product research at the Company's
Albuquerque pilot plant and research facility totaled $1,016,456, for the
quarter ended September 30, 1996. Research and development expenditures for
the same period a year ago totaled $662,882, of which $131,652 was allocated
to the Oil Sands Co-production Project and was paid for by United Tri-Star
Resources Limited ("UTS") as hereinafter set forth.
The Company continues to record a receivable from UST for 10% of the project
costs, along with certain monthly operating expenditures. Payment by UTS for
these expenditures allows UTS to maintain its 10% working interest in the
development of the Company's co-production process and associated projects
using the Company's technology.
The increase in research and development expenditures for the quarter ended
September 30, 1996, compared to the same period of
-8-
<PAGE>
SOLV-EX CORPORATION AND SUBSIDIARIES
(DEVELOPMENT STAGE ENTERPRISES)
MATERIAL CHANGES IN FINANCIAL CONDITION, LIQUIDITY AND CAPITAL
RESOURCES (CONTINUED)
the prior year, reflects costs associated with continued refinement of the
bitumen and minerals extraction process from oil sands and oil sands
tailings, development of the electrolytic cell for the production of aluminum
metal and development costs associated with TiO2-S.
General and administrative expense for the quarter ended September 30, 1996
and 1995, were $1,204,228 and $240,324, respectively. Increases in 1996 from
1995 reflects the increased level of operations of the Company during the
1996 quarter, the additions to personnel and normal salary increases.
Included in the general and administrative expenses are non-cash compensatory
expenses of $180,125, for the three months ended September 30, 1996, for
performance of services, as compared to $3,047 for the same period in 1995.
The Company recorded a net loss of $2,290,609 for the three months ended
September 30, 1996, as compared to a net loss of $744,704 for the same period
ended September 30, 1995. The 1996 net loss is significantly greater than the
loss in the previous year because of the increased level of corporate
activities during the three months ended September, 1996, including continued
construction activity on the Bitumount Lease, and expanded research and
development efforts at the pilot plant. Funding received from UTS in the
previous year had been primarily applied against research and development
expenditures in accordance with the UTS agreement, resulting in a smaller
loss at September 30, 1995, as compared to September 30, 1996.
-9-
<PAGE>
SOLV-EX CORPORATION AND SUBSIDIARIES
(DEVELOPMENT STAGE ENTERPRISES)
MATERIAL CHANGES IN FINANCIAL CONDITION, LIQUIDITY AND CAPITAL
RESOURCES (CONTINUED)
Revenues were generated from interest earned on cash balances. Interest
income for the three months ended September 30, 1996 totaled $420,432
compared to $26,850 for the same period a year ago. This increase in interest
income is the result of greater cash balances during the three months in 1996
as compared to the preceding year, resulting from equity capital and
convertible debt issuances.
During the three months ended September 30, 1996, the Company has expended
approximately $16 million, the majority of which relates to the construction
costs associated with the initial stage plant. The Company anticipates the
cost to complete the initial stage plant to be an additional $23 million. As
of September 30, 1996, total cash and receivables, representing Canadian
sales tax refunds, totaled over $29 million, not including funds due from UTS.
It is expected that existing cash and receivables, along with funds which the
Company expects to receive from UTS upon completion of a limited partnership
agreement covering its 10% share of capital costs, will be adequate to cover
cost to complete the initial stage facility, as well as to fund the pilot
plant and overhead expenditures. Engineering and construction of the initial
stage plant, for commercial production of bitumen from oil sands will
continue through the winter months. The Company anticipates that the initial
stage plant will be operational and initiate commercial production and sale
of bitumen during the first quarter of calendar year 1997. The schedule is
considered aggressive and delays could adversely affect total capital costs.
Accordingly, the Company may endeavor to arrange additional financing which
accommodates delays or capital cost overruns, as well as other activities
being conducted by the Company which may be subject to curtailment in the
absence of additional funding.
Although there can be no assurance that any additional financing can be
arranged or arranged upon acceptable terms and conditions, the Company
believes it will be able to do so through a combination of efforts or
methods, including joint ventures, licensing agreements for the Company's
technology, equity investors (public or private), venture capital groups,
institutions, issuance of convertible or subordinated debt or a form of
business combination, as well as operating cash flow which it expects to
derive from the initial stage bitumen plant.
While the Company plans to undertake expansion of the initial stage oil plant
and complete the minerals extraction plant during 1997, its ability to do so
will depend upon the availability of additional capital and, to a large
extent, upon the successful operation of the initial stage plant. While
management believes that the initial stage plant will operate successfully
based upon pilot plant operations and other evaluations performed to date,
there can be no assurance that it will, in fact, operate as anticipated
without additions or modifications.
-10-
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13, or 15(d) 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.
SOLV-EX CORPORATION
(Registrant)
By /S/ JOHN S. RENDALL
----------------------------------------
John S. Rendall, Chief Executive Officer
By /S/ W. JACK BUTLER
----------------------------------------
W. Jack Butler, President and
Chief Financial Officer
DATE: November 12, 1996
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 27,982,109
<SECURITIES> 0
<RECEIVABLES> 3,164,416
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 36,493,663
<PP&E> 41,332,563
<DEPRECIATION> 1,365,127
<TOTAL-ASSETS> 79,032,003
<CURRENT-LIABILITIES> 5,065,490
<BONDS> 33,694,238
0
0
<COMMON> 229,134
<OTHER-SE> 67,601,678
<TOTAL-LIABILITY-AND-EQUITY> 79,032,003
<SALES> 0
<TOTAL-REVENUES> 420,432
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,220,684
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 490,357
<INCOME-PRETAX> (2,290,609)
<INCOME-TAX> 0
<INCOME-CONTINUING> (2,290,609)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,290,609)
<EPS-PRIMARY> (.15)
<EPS-DILUTED> 0
</TABLE>
