SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the Quarter Ended: July 31, 1998
Commission File No. 0-9496
-------------------
GOLD STANDARD, INC.
-------------------
(Exact name of registrant as specified in its charter)
Utah 87-0302579
------------------------------- ------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Suite 712 Kearns Building, Salt Lake City, Utah 84101
- ------------------------------------------------- ---------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (801) 328-4452
--------------
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Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
None NASDAQ and Pacific Stock Exchange
------ ---------------------------------
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, par value $.001 per share
----------------------------------------
(Title of class)
Indicate by check mark whether 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 Registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.
Yes X No
--- ---
As of the close of the period covered by this report there were
outstanding 4,674,375 shares of Registrant's common stock, $.001 par
value per share.
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
---------------------
GOLD STANDARD, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
FOR INCLUSION IN QUARTERLY REPORT
ON FORM 10-Q
July 31, 1998
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GOLD STANDARD, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
July 31, 1998 and October 31, 1997
July 31, 1998 October 31, 1997
------------- ----------------
(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 2,188,164 $ 3,231,441
Certificates of deposit 1,242,587 1,197,222
Accounts receivable 726,092 -
Accrued interest 8,034 9,039
Prepaid expenses 3,316 6,844
-------------- --------------
TOTAL CURRENT ASSETS 4,168,193 4,444,546
PROPERTY AND EQUIPMENT
Equipment and leasehold
improvements 145,120 206,465
-------------- --------------
145,120 206,465
OTHER ASSETS
Securities available for sale - 252,998
Equity investment 256,500 -
Deposits 1,120 3,404
-------------- --------------
257,620 256,402
-------------- --------------
$ 4,570,933 $ 4,907,413
============== ==============
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LIABILITIES AND EQUITY
CURRENT LIABILITIES
Accounts payable - trade $ 7,723 $ 85,890
Accrued liabilities 29,386 29,434
Income tax payable 100 300
-------------- --------------
TOTAL CURRENT LIABILITIES 37,209 115,624
STOCKHOLDERS' EQUITY
Common stock 4,674 4,674
Additional paid-in capital 13,193,952 13,529,951
Unrealized holding gain (loss) on
securities available for sale - 6,149
Accumulated deficit (8,664,902) (8,748,985)
-------------- --------------
(509,134)
TOTAL STOCKHOLDERS' EQUITY 4,533,724 4,791,789
-------------- --------------
$ 4,570,933 $ 4,907,413
============== ==============
See accompanying notes to consolidated financial statements.
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GOLD STANDARD, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
Three and nine month periods ended
July 31, 1998 and October 31, 1997
Three months ended Nine months ended
July 31, July 31,
----------------------- -----------------------
1998 1997 1998 1997
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
----------- ----------- ----------- -----------
INCOME FROM OPERATIONS
Royalty income $ - $ - $ - $ -
EXPENSES
Depreciation 11,770 12,547 35,310 37,640
Leasehold exploration
and carrying costs 252,238 312,529 724,203 1,023,396
General and
administrative:
Legal 6,870 1,428 27,278 10,148
Other 72,084 71,037 256,109 272,355
NET LOSS FROM ---------- ---------- ------------ ------------
OPERATIONS (342,962) (397,541) (1,042,900) (1,343,539)
OTHER INCOME (EXPENSES)
Interest income 43,431 58,682 122,376 175,773
Gain (loss) on disposal
of assets - - - (9,969)
Gain (loss) on exchange - - (10,000) -
Gain (loss) from
investments - - (101,409) (11,503)
---------- ---------- ------------ ------------
(299,531) (338,859) (1,031,933) (1,189,238)
NET LOSS MINORITY INTEREST - - - 101,902
---------- ---------- ------------ ------------
NET INCOME (LOSS) $(299,531) $(338,859) $(1,031,933) $(1,087,336)
========== ========== ============ ============
Net income (loss)
per common share $ (0.06) $ (0.02) $ (0.22) $ (0.06)
========== ========== ============ ============
See accompanying notes to consolidated financial statements.
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GOLD STANDARD, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Three and nine month periods ended
July 31, 1998 and October 31, 1997
Three months ended Nine months ended
July 31, July 31,
----------------------- -------------------------
1998 1997 1998 1997
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
CASH PROVIDED BY (USED IN) ----------- ----------- ------------ ------------
OPERATING ACTIVITIES
Net income (loss) $ (299,531) $ (338,859) $(1,031,933) $(1,087,336)
Add (deduct) adjustments
to cash basis:
Depreciation 11,770 12,547 35,310 37,640
Net investment
(gains) losses - - - 11,503
Net exchange adjustment - - 793,500 -
Net loss -
minority interest - - - (101,902)
Decrease (increase) in:
Accrued interest (7,697) 6,362 1,005 6,799
Prepaid expenses (1,465) (1,491) 3,528 (3,810)
Deposits - - 2,284 (50)
Deferred costs - (2,012) - (13,043)
Increase (decrease) in:
Accounts payable (5,830) (4,606) (64,757) (34,870)
Income tax payable - - (50) -
Accrued liabilities 2 - (198) (625)
----------- ----------- ------------ ------------
NET CASH PROVIDED BY
(USED IN) OPERATING
ACTIVITIES (302,751) (328,059) (261,311) (1,185,694)
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CASH USED IN INVESTMENT ACTIVITIES
Decrease (increase)
in certificates
of deposits (27,430) - (45,365) -
Equipment purchased - - (7,007) (50,262)
Decrease (increase) in
of securities - - 252,998 -
Increase in equity
investments - - (982,592) -
Disposal of assets - - - 27,468
----------- ----------- ------------ ------------
NET CASH USED IN INVEST-
INVESTMENT ACTIVITIES (27,430) - (781,966) (22,794)
NET INCREASE
(DECREASE) IN CASH (330,181) (328,059) (1,043,277) (1,208,488)
CASH BALANCE AT
BEGINNING OF PERIOD 2,518,345 5,197,892 3,231,441 6,078,321
----------- ----------- ------------ ------------
CASH BALANCE AT
END OF PERIOD $2,188,164 $4,869,833 $ 2,188,164 $ 4,869,833
=========== =========== ============ ============
See accompanying notes to consolidated financial statements.
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GOLD STANDARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
July 31, 1998 and October 31, 1997
(Unaudited)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Company's accounting policies reflect industry practices and con-
form to generally accepted accounting principles. The following policies
are considered to be significant:
Financial Statements
--------------------
The financial information provided in the Consolidated Balance Sheet for
the year ended October 31, 1997, has been taken from the audited financial
statements at that date. In the opinion of management, all adjustments
necessary to present fairly the financial position, results of operations
and cash flow at July 31, 1998, have been made. All such adjustments were
of a normal, recurring nature.
Principles of Consolidation
---------------------------
The accompanying consolidated financial statements at July 31, 1998,
include the accounts of Gold Standard, Inc., and its wholly owned
subsidiaries, Gold Standard South and Gold Standard Minas, S.A. As used
herein, references to Gold Standard, Inc., the Registrant, or the Company
refers to Gold Standard, Inc. and its consolidated subsidiaries. All
significant intercompany transactions are eliminated.
Big Pony Gold, Inc., a 64.4% owned subsidiary as of October 31, 1997
was included in the consolidation for that period. As of July 31, 1998 the
Company's ownership interest in Big Pony Gold, Inc. had declined to 35%.
The investment in Big Pony Gold, Inc. is accounted for under the equity
method for periods beginning after October 31, 1997.
Gold Standard South, a Utah corporation, was organized for the express
purpose of carrying on a property acquisition and gold exploration program
in the country of Uruguay. The Company is presently conducting exploration
work in Uruguay at properties assigned to it by Big Pony Gold, Inc. In
March, 1998. Gold Standard Minas was organized for the purpose of carrying
on a gold exploration program in the country of Brazil.
Investment in Mining Properties
-------------------------------
Prospecting and exploration costs incurred in the search for new mining
properties are charged to expense as incurred. Direct costs associated
with the development of identified reserves are capitalized until the
related geological areas are either put into production, sold or abandoned.
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As of July 31, 1998, there were no geological areas under production.
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Earnings (Loss) Per Share
-------------------------
Earnings (loss) per share of common stock is computed on the
weighted-average number of shares outstanding during the period.
Cash Equivalents
----------------
For purposes of the statement of cash flows, the Company considers
all highly liquid debt instruments and investments readily convertible
into cash, or purchased with a maturity of three months or less, to be
cash equivalents.
Foreign Currency Translation
----------------------------
Substantially all assets and liabilities of the Company's international
operations are translated at year-end exchange rates and the resulting
adjustments are accumulated in stockholders' equity. Income and expenses
are translated at exchange rates prevailing during the period. Foreign
currency transaction gains and losses are included in net income, except
for those relating to intercompany transactions of a long-term investment
nature, which are accumulated in stockholders' equity.
NOTE 2 - SECURITIES AVAILABLE FOR SALE
In February, 1996, the Company entered into a non-monetary transaction
exchanging rights to diamond potential properties located in Brazil for
100,000 shares of American Mineral Fields stock (AMZ) which was trading
at $4.00 per share. This transaction resulted in a net gain to the
Company of $300,000 ($400,000 less $100,000 paid to three geologists as
bonuses on the transaction).
During 1998 the Company sold the last 49,000 shares of AMZ stock at
a loss of $101,409. The Company realized a net gain on sales of all AMZ
shares since 1996 in the amount of $50,947.
NOTE 3 - EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements are stated at cost. Maintenance,
repairs, and renewals which neither materially add to the value of the
property nor appreciably prolong its life are charged to expense as
incurred. Gains or losses on dispositions of property and equipment are
included in earnings. Depreciation and amortization of property and
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equipment is provided on the straight-line method using the estimated
lives shown below:
NOTE 3 - EQUIPMENT AND LEASEHOLD IMPROVEMENTS (Continued)
Years
-----
Furniture and equipment 5-7
Transportation equipment 5
Leasehold improvements lease term
Amortization of leasehold improvements is calculated using the
straight-line method over the term of the lease agreement.
NOTE 4 - MINING PROPERTIES
The Company holds directly or through its subsidiary companies,
mineral and exploration rights to property located in Western Utah,
Southern Uruguay, Brazil and other South American locations. All
exploration costs associated with these properties have been charged
to operations as incurred, consistent with the Company's accounting
policies (see Note 1).
The Company's leasehold exploration and carrying expenses for the
three month period ended July 31, 1998 are summarized as follows:
Uruguay $ 94,147
Brazil 158,091
---------
Total $ 252,238
NOTE 5 - EQUITY INVESTMENT
Due to a number of considerations the Company's subsidiary Big Pony
Gold, Inc. changed business strategies this year and has left the
mining industry to enter the motor sports industry.
In order to improve the Company's position as creditor and investor,
the Company has returned 750,000 of their 3,316,667 shares of Big Pony
Gold stock and has received assignment of all the equipment and mineral
rights held in Big Pony's name in Uruguay. As a result of this trans-
action and the purchase of 3,000,000 shares of Big Pony Gold by other
investors, the Company's ownership interest in Big Pony Gold has been
reduced to 35%. The consolidated accounting method no longer applies to
Big Pony Gold and the Company now carries its investment under the
equity method of accounting. This change has resulted in an adjustment
to shareholders' equity of $793,500.
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NOTE 6 - CAPITAL STOCK
On March 2, 1998 the board of directors of the Company approved a one
for four reverse stock split affecting all of the Company's common stock.
The split was effected in order to meet NASDAQ's new listing require-
ments. The split reduced the number of outstanding shares from 18,697,500
to 4,674,375. Par value after the split remained at $.001 per share
resulting in an adjustment on the balance sheet between common stock and
additional paid in capital of $14,024. This split has been shown for all
periods.
NOTE 7 - STOCK WARRANTS
In connection with issuance of its common stock, the Company has
issued warrants to others for the purchase additional shares at specified
prices in the future. Unexercised warrants aggregate 1,275,000 shares at
July 31, 1998. They carry a weighted average price of $1.50 per share and
have a weighted average remaining life of two years.
NOTE 8 - WARRANTS ISSUED AS COMPENSATION
The Company has issued compensatory stock warrants to officers,
employees and consultants during the coarse of business. No compensation
expense has been recorded for these warrants.
Reported and pro forma net loss and loss per share for the periods
ended July 31, 1998 and October 31, 1997 are as follows:
July 31, October 31,
1998 1997
Net loss ------------ ------------
As reported $(1,031,933) $(1,595,868)
Pro forma $(1,031,933) $(1,595,868)
Loss per share
As reported (.22) (.34)
Pro forma (.22) (.34)
The pro forma effect on net loss for 1997 may not be representative
of the pro forma effect on net income or loss for future years because
the SFAS No. 123 method of accounting for pro forma compensation expense
has not been applied to warrants granted prior to January 1, 1995.
NOTE 8 - WARRANTS ISSUED AS COMPENSATION (Continued)
The weighted-average fair values at date of grant for compensatory
warrants were estimated using the Black-Scholes option pricing model,
based on the following assumptions: (1) no expected dividend yields;
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(ii) an expected volatility rate o 104%; and (iii) expected weighted
average lives of 1.9 years. The weighted-average risk-free interest
rate applied was 6.20%.
Stock warrant activity is summarized as follows:
July 31, October 31,
1998 1997
------------------ ------------------
Avg. Avg.
Exercise Exercise
Shares Price Shares Price
------- -------- ------- --------
Warrants outstanding
beginning of period 225,000 $1.25 225,000 $1.25
Granted - - - -
Exercised - - - -
Canceled or expired - - - -
Warrants outstanding
and exercisable,
end of period 225,000 $1.25 225,000 $1.25
The following table summarizes information about stock warrants
outstanding and exercisable at July 31, 1998 and October 31, 1997:
Exercise Price Shares Life
-------------- ------- ----
$1.00 25,000 .2 yr
1.25 175,000 1.8
1.50 25,000 4.5
-------
225,000
NOTE 9 - RELATED PARTY TRANSACTIONS
The Company has funded the majority of the operations of its
subsidiaries Gold Standard South and Gold Standard Minas, and its former
subsidiary Big Pony Gold, Inc. with unsecured non-interest bearing long
term cash advances. As of July 31, 1998, the Company had receivables
from these companies of $628,431, $1,260,806 and $726,092, respectively.
With the exception of the $726,092 advance to Big Pony Gold, all
intercompany transactions have been eliminated in consolidation.
On March 14, 1996, the Company acquired 750,000 shares of the common
stock of its subsidiary Big Pony Gold, Inc. in exchange for cancellation
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of $10,000 in debt owed by the subsidiary to the Company and transfer by
the Company of all its interest in certain mineral rights and assets
pursuant to the cancellation of a joint venture agreement. These
properties were returned to the Company In March 1998 (see Note 5)
In 1997, the Company converted cash advances to Gold Standard Minas,
to equity in the amount of $817,652.
NOTE 10 - COMMITMENTS
To guarantee future reclamation commitments in Uruguay, the Company
has obtained a standby letter of credit in the amount of $1,000,000. No
amounts had been drawn on this line as of July 31, 1998.
A similar letter of credit under similar terms, in the amount of
$100,000 has been obtained to guarantee commitments in Paraguay. No
amounts had been drawn against the line as of July 31, 1998.
NOTE 11 - INCOME TAXES
The Company has significant net operating loss and net capital loss
carryforwards which should give rise to a deferred tax asset. Because
the Company has no assurance that the tax benefit from the net operating
loss and net capital loss will ever be realized, a valuation allowance
has been provided equal to the deferred tax asset.
The amounts and expiration dates of net operating loss carryforwards
and investment tax credits at July 31, 1998 are detailed in the following
summary:
Federal State Net
Net Operating Net Operating Capital
Expiration Date Loss Loss Loss
---------------- ------------- ------------- --------
October 31, 1998 $ -- $ 15,927 $ --
October 31, 1999 -- 674,075 --
October 31, 2000 -- -- 150,056
October 31, 2002 -- -- 18,503
October 31, 2003 1,440,772 -- --
December 31, 2003 1,391 -- --
October 31, 2004 675,277 -- --
December 31, 2004 332,153 -- --
October 31, 2005 1,106,261 -- --
December 31, 2005 408,740 -- --
October 31, 2006 762,506 -- --
October 31, 2007 568,726 -- --
October 31, 2008 16,027 -- --
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October 31, 2009 673,421 -- --
October 31, 2010 185,357 185,057 --
October 31, 2011 241,032 240,932 --
October 31, 2012 790,574 790,274 --
---------- ----------- ---------
$7,202,237 $ 1,906,265 $ 168,559
NOTE 12 - LITIGATION
In 1986, the Company filed a lawsuit against American Barrick
Resources Corporation, Getty Oil Company, and Texaco, relative to party's
interest on the Mercur gold mine located in Tooele County, Utah. The
lawsuit alleges breach of contract, breach of fiduciary duty and several
other causes of action related to the operating agreement between the
Company and the defendants or their successors in interest to the Mercur
gold mine. Under the action, the Company sought the return of the Mercur
property, monetary damages and other appropriate relief.
In April, 1993, the Company accepted an out-of-court cash settlement
with American Barrick Resources Corporation, one of the defendants in
the action, for a net of $5,225,000.
The lawsuit against the other defendants went to trial in July, 1993.
Following a seven week trial, the jury returned a verdict in favor of
the Company on September 3, 1993, and awarded the Company $404,164,000
in damages. Subsequently, the judge set aside the jury verdict, thereby
denying the Company the jury's award. The Company appealed the judge's
decision to the Supreme Court of the State of Utah. On January 11, 1996,
the Supreme Court announced its decision to uphold the trial judge's
directed verdict for the defendants in the case. As a result of the un-
successful appeal, in April 1998 the Company paid $58,000 in court costs.
In May, 1996, the Company was notified that a Writ of Reconsideration
filed with the Utah Supreme Court was denied. The Company has decided to
no longer continue its efforts in the lawsuit.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
-------------------------------------------------
INTRODUCTION
Gold Standard, Inc. and its subsidiaries (the Registrant) are princi-
pally engaged in the acquisition, exploration, and if warranted, develop-
ment of producing or potentially productive gold properties. Its
activities are concentrated, for the most part, in Uruguay, Brazil and
Paraguay.
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A significant factor effecting the Registrant's operations for years
was its lawsuit against the operators and former operators of the Mercur
Gold Mine in Tooele County, Utah. A January, 1996 ruling against the
Registrant, and a subsequent denial for reconsideration has ended the
Registrant's efforts in the case.
RESULTS OF OPERATIONS
No revenue was generated through operations by the Registrant during
the three and nine month periods ended July 31, 1998 and it is not ex-
pected that any operating revenue will be generated during 1998. For
several years the Registrant was a partner in joint ventures in mining
properties in Uruguay. Royalty revenue was received from these proper-
ties in 1996 and 1995. At the present time all joint ventures have been
dissolved.
The Registrant's operating activities have been solely exploration
related and have been concentrated on their Uruguay, Brazil, and
Paraguay. Exploration related expenses for the nine month period ended
July 31, 1998 were $724,203 ($1,023,396 for the nine month period ended
July 31, 1997). Exploration costs incurred during the nine month period
ended July 31, 1998 are summarized as follows:
Uruguay $ 114,262
Brazil 603,858
Paraguay 6,083
----------
$ 724,203
==========
Exploration expenses have been higher in 1998 than in 1997 at the
Registrant's properties in Brazil. This exploration activity is being
conducted by the Registrant's subsidiary, Gold Standard Minas, S.A.
Prior to March, 1998, the Registrant's exploration activities at its
properties in Uruguay were being conducted through its subsidiary, Big
Pony Gold. All rights to these properties have since been transferred
to the Registrant and exploration activities are ongoing.
The Registrant's general and administrative expenses, excluding legal
expenses totaled $256,109 for the nine month period ended July 31, 1998
($272,355 for the nine month period ended July 31, 1997). The two most
significant general and administrative expense categories during the nine
month period ended July 31, 1998 were (a) professional and consulting
fees $63,638 ($82,409 in 1997) and (b) wages and salaries $107,000
($104,096 in 1997). The balance of general and administrative expenses
includes office supplies and expenses, office rent, travel, etc.
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LIQUIDITY AND CAPITAL RESOURCES
In the absence of income from operations the Registrant will continue
to rely on funds received in prior years for its operations. These funds
include royalty revenues, lawsuit settlements, equity funding, and
proceeds from sales of securities.
The Registrant has no material capital commitments or agreements which
would require significant outlays of capital during the remaining three
months of the year.
Expenses in the remaining three months of 1998 should remain close to
the level during in the first nine months of the year. In the short term,
the Registrant has sufficient cash reserves to fund operations. In the
long-term there can be no assurance that cash on hand will be sufficient
for all operating costs. However, if necessary the Registrant will look
to the issuance of additional equity capital and increased production
from its properties.
INFLATION
The impact of inflation on the Registrant's operations will vary. The
future price of gold and the level of future interest rates could
directly effect the Registrant's future operating revenue.
Serious increases in inflation could increase general and administra-
tive expenses for the Registrant and make it difficult to remain within
budget. However, management does not expect any material increases in
the inflation rate during the near future.
ENVIRONMENTAL RULES AND REGULATIONS
The Registrant is not aware of any noncompliance with environmental
rules and regulations, nor has the Registrant been cited by any local,
state or national agency either in the United States or South America for
noncompliance with environmental rules and regulations.
The Registrant has obtained a standby letter of credit in the amount of
$1,000,000 which is pledged as security against future potential reclama-
tion costs of mineral properties under exploration in Uruguay. A similar
$100,000 letter of credit has been pledged as security for operations in
Paraguay. Furthermore, the Registrant is not aware of any potential
reclamation costs. Except for the above, the Registrant has no actual or
potential involvement in environmental remediation activities.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS. Not Applicable
ITEM 2. CHANGES IN SECURITIES. Not Applicable
ITEM 3. DEFAULTS UPON SENIOR SECURITIES. Not Applicable
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No items were presented for a vote of security holders
during the period ended July 31, 1998.
ITEM 5. OTHER INFORMATION. Not Applicable
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) List of Exhibits
27.0 Financial Data Schedule
(b) Reports on Form 8-K
Not applicable
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Gold Standard, Inc.
Date 10 September 1998 By:/s/ Scott L. Smith
Exhibit Index
-------------
Exhibit No. Description
- ----------- -----------
27 Financial Data Schedule.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-1998
<PERIOD-END> JUL-31-1998
<CASH> $3,430,751
<SECURITIES> 0
<RECEIVABLES> $726,092
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> $4,168,193
<PP&E> $145,120
<DEPRECIATION> 0
<TOTAL-ASSETS> $4,570,933
<CURRENT-LIABILITIES> $37,209
<BONDS> 0
0
0
<COMMON> $4,674
<OTHER-SE> $4,529,050
<TOTAL-LIABILITY-AND-EQUITY> $4,570,933
<SALES> 0
<TOTAL-REVENUES> $43,431
<CGS> 0
<TOTAL-COSTS> $252,238
<OTHER-EXPENSES> $90,724
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> $(299,531)
<INCOME-TAX> 0
<INCOME-CONTINUING> $(299,531)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> $(299,531)
<EPS-PRIMARY> (.06)
<EPS-DILUTED> (.06)
</TABLE>
