<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of
1934
FOR QUARTER ENDED JUNE 30, 1995
COMMISSION FILE NUMBER 2-82765
REAL EQUITY PARTNERS
A CALIFORNIA LIMITED PARTNERSHIP
I.R.S. EMPLOYER IDENTIFICATION NO. 95-3784125
9090 Wilshire Boulevard, Suite 201,
Beverly Hills, CA 90211
Registrant's Telephone Number,
Including Area Code (310) 278-2191
Securities Registered Pursuant to
Section 12(b) or 12(g) of the Act
NONE
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed with the Commission by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding twelve 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 X No
----- -----
<PAGE> 2
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
INDEX TO FORM 10-Q
FOR THE QUARTER ENDED JUNE 30, 1995
<TABLE>
<S> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements and Notes to Financial Statements
Balance Sheets, June 30, 1995 and December 31, 1994 . . . . . . . . . . . . . . . . . 1
Statements of Operations,
Six and Three Months Ended June 30, 1995 and 1994 . . . . . . . . . . . . . . . 2
Statement of Partners' Equity,
Six Months Ended June 30, 1995 . . . . . . . . . . . . . . . . . . . . . . . . . 3
Statements of Cash Flows,
Six Months Ended June 30, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . 4
Notes to Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . . . . . . . . . . . . . . . 8
PART II. OTHER INFORMATION
Item 1. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
</TABLE>
<PAGE> 3
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
BALANCE SHEETS
JUNE 30, 1995 AND DECEMBER 31, 1994
ASSETS
<TABLE>
<CAPTION>
1995 1994
(Unaudited) (Audited)
------------ -------------
<S> <C> <C>
RENTAL PROPERTY, at cost
Land $ 7,077,565 $ 7,077,565
Buildings 26,949,118 26,949,118
Furniture and equipment 4,034,243 4,034,243
------------ ------------
38,060,926 38,060,926
Less accumulated depreciation (14,042,313) (13,587,088)
------------ ------------
24,018,613 24,473,838
------------ ------------
CASH AND CASH EQUIVALENTS 1,143,790 1,195,937
------------ ------------
OTHER ASSETS:
Due from affiliated rental agent 883,844 703,125
Other receivables and prepaid expenses 286,970 295,129
------------ ------------
1,170,814 998,254
------------ ------------
$ 26,333,217 $ 26,668,029
============ ============
LIABILITIES AND PARTNERS' EQUITY
LIABILITIES:
Mortgage notes payable $ 17,834,452 $ 17,959,940
Accrued fees and expenses due general partner 630,084 609,195
Accounts payable and accrued expenses 1,112,428 1,069,300
Tenant security deposits 279,359 279,359
------------ ------------
19,856,323 19,917,794
PARTNERS' EQUITY 6,476,894 6,750,235
------------ ------------
$ 26,333,217 $ 26,668,029
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
1
<PAGE> 4
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF OPERATIONS
SIX AND THREE MONTHS ENDED JUNE 30, 1995 AND 1994
(Unaudited)
<TABLE>
<CAPTION>
Six months Three months Six months Three months
ended ended ended ended
June 30, 1995 June 30, 1995 June 30, 1994 June 30, 1994
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
RENTAL OPERATIONS
Revenues
Rental income $2,656,272 $1,322,005 $2,664,408 $1,355,088
Other income 144,170 80,035 137,512 80,402
---------- ---------- ---------- ----------
2,800,442 1,402,040 2,801,920 1,435,490
---------- ---------- ---------- ----------
Expenses
Operating expenses 1,381,308 768,476 1,441,306 841,576
Depreciation 455,226 227,613 455,004 227,613
General and administrative 129,945 72,182 95,133 39,649
Management fees-affiliate 154,665 81,198 151,012 75,951
Interest expense 892,735 444,520 764,840 378,828
---------- ---------- ---------- ----------
3,013,879 1,593,989 2,907,295 1,563,617
---------- ---------- ---------- ----------
Loss from rental operations (213,437) (191,949) (105,375) (128,127)
---------- ---------- ---------- ----------
PARTNERSHIP OPERATIONS
Interest income 22,780 17,868 11,911 6,932
---------- ---------- ---------- ----------
Expenses
Interest expense-general partner 20,889 10,502 61,284 11,541
General and administrative 39,831 18,303 47,280 9,996
Professional fees 21,964 9,841 36,787 19,910
---------- ---------- ---------- ----------
82,684 38,646 145,351 41,447
---------- ---------- ---------- ----------
Loss from partnership operations (59,904) (20,778) (133,440) (34,515)
---------- ---------- ---------- ----------
Net loss $ (273,341) $ (212,727) $ (238,815) $ (162,642)
========== ========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE> 5
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENT OF PARTNERS' EQUITY (DEFICIENCY)
SIX MONTHS ENDED JUNE 30, 1995
(Unaudited)
<TABLE>
<CAPTION>
General Limited
Partners Partners Total
--------- ----------- ----------
<S> <C> <C> <C>
PARTNERSHIP INTERESTS,
June 30, 1995 30,000
==========
EQUITY (DEFICIENCY),
at January 1, 1995 $(717,075) $7,467,310 $6,750,235
Net loss for the six months
ended June 30, 1995 (2,733) (270,608) (273,341)
--------- ---------- ----------
EQUITY (DEFICIENCY),
at June 30, 1995 $(719,808) $7,196,702 $6,476,894
========= ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE> 6
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1995 AND 1994
(Unaudited)
<TABLE>
<CAPTION>
1995 1994
---------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (273,341) $ (238,815)
Adjustment to reconcile net loss to net cash
provided by (used in) operating activities:
Depreciation 455,225 455,004
(Increase) decrease in:
Other receivables and prepaid expenses 8,159 (177,375)
Due from affiliated rental agent (180,719) 386,842
Increase (decrease) in:
Accrued fees and expenses due general partner 20,889 (2,249,113)
Accounts payable and accrued expenses 43,128 (28,391)
---------- -----------
Net cash provided by (used in) operating activities 73,341 (1,851,848)
---------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions to partners - (300,000)
Principal payments on mortgage notes payable (125,488) (120,826)
Proceeds from mortgage notes payable - 5,785,000
Payments of mortgage notes payable - (3,096,178)
---------- -----------
Net cash provided by (used in) financing activities (125,488) 2,267,996
---------- -----------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (52,147) 416,148
CASH AND CASH EQUIVALENTS, at beginning of period 1,195,937 736,699
---------- -----------
CASH AND CASH EQUIVALENTS, at end of period $1,143,790 $ 1,152,847
========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE> 7
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1995
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
GENERAL
The information contained in the following notes to the financial
statements is condensed from that which would appear in the annual
audited financial statements; accordingly, the financial statements
included herein should be reviewed in conjunction with the financial
statements and related notes thereto contained in the annual report
for the year ended December 31, 1994 filed by Real Equity Partners
(the "Partnership"). National Partnership Investments Corp.
("NAPICO") is the corporate general partner of the Partnership.
Accounting measurements at interim dates inherently involve greater
reliance on estimates than at year end. The results of operations for
the interim periods presented are not necessarily indicative of the
results for the entire year.
In the opinion of the general partners of the Partnership, the
accompanying unaudited financial statements contain all adjustments
(consisting primarily of normal recurring accruals) necessary to
present fairly the financial position of the Partnership as of June
30, 1995, and the results of operations and changes in cash flow for
the six months then ended.
RENTAL PROPERTY AND DEPRECIATION
Rental property is stated at cost. Depreciation is provided for on
the straight-line method over the estimated useful lives of the
buildings and equipment.
On January 17, 1994, the Park Creek and Warner Willows I and II rental
properties sustained damage, estimated at approximately $1,454,000,
due to the earthquake in the Los Angeles area. Insurance proceeds of
approximately $630,000 were allocated to the Partnership in 1994, as
the estimated full settlement under a master umbrella insurance policy
covering earthquake damage for these and other properties managed by a
related party. Included in liabilities at June 30, 1995 is
approximately $630,000 related to the earthquake damages. The total
estimated expenditures needed to repair the properties, net of the
insurance recoveries, which nets to approximately $824,000, were
expensed in the period ended December 31, 1994, since they did not
extend the useful life of the properties.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of cash and bank certificates of
deposit with an original maturity of three months or less.
NOTE 2 - MORTGAGE NOTES PAYABLE
Mortgage notes payable consist of the following:
a. Conventional mortgage notes bearing interest at rates ranging
from 8% to 10.375% per annum, payable in monthly installments
ranging from $11,710 to $44,300 per month and having maturity
dates from February 1996 to March 2001. These notes total
$15,440,131 at June 30, 1995.
5
<PAGE> 8
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 1995
NOTE 2 - MORTGAGE NOTES PAYABLE (CONTINUED)
b. Mortgage note, insured by the Department of Housing and Urban
Development under the Section 221(d)(4) program, bearing
interest at the rate of 7 percent per annum, payable in
monthly installments of approximately $19,500, including
interest through maturity in the year 2013. The note has a
balance of $2,394,321 at June 30, 1995.
The mortgage notes are secured by deeds of trust on the rental
properties.
The mortgage on the Arbor Glen property matures in April 1996. The
Partnership has submitted applications to refinance the property.
There can be no assurance, however, that a new mortgage will be
obtained or that the current mortgagor will extend the term of the
existing mortgage.
The Partnership withheld the May, June and July mortgage payments on
the Parkside property and a default letter was received from the
lender. The Partnership has requested from the lender an interest
rate reduction and an extended maturity date on the mortgage.
NOTE 3 - INCOME TAXES
No provision has been made for income taxes in the accompanying
financial statements as such taxes, if any, are the liability of the
individual partners.
NOTE 4 - RELATED PARTY TRANSACTIONS
The Partnership has entered into agreements with an affiliate of
NAPICO to manage the operations of the rental properties. The
agreements are on a month-to-month basis and provide, among other
things, for a management fee equal to 5 percent of gross rentals and
other collections. Management fees charged to operations under this
agreement were approximately $154,600and $151,000 for the six months
ended June 30, 1995 and 1994, respectively.
An affiliate of the corporate general partner repaired certain of the
earthquake damage at the Park Creek and Warner Willows I and II rental
properties. The payments to this affiliate for these repairs was
approximately $733,000 through June 30, 1995.
Under the terms of the Restated Certificate and Agreement of Limited
Partnership (the "Partnership Agreement"), the Partnership is
obligated to the corporate general partner for a deferred acquisition
fee. This fee is for services rendered in connection with the
selection, purchase, acquisition, development, and management of the
Partnership and monitoring the operations of the properties.
Distribution of any part of this fee shall be subordinated to receipt
by each Limited Partner of an amount equal to a cumulative non-
compounded 6 percent annual distribution with respect to the adjusted
capital value (as defined in the Partnership Agreement). The
aggregate amount of the deferred acquisition fee distributed in any
year from net cash from operations shall not exceed an amount equal to
3 percent of the investment in proper-
6
<PAGE> 9
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 1995
NOTE 4 - RELATED PARTY TRANSACTIONS (CONTINUED)
ties plus any proceeds from sale or refinancing of the properties.
The deferred acquisition fee shall be an amount which, when present
valued at 8 percent from certain dates as defined in the Partnership
Agreement, equals 10 percent of the gross proceeds of the offering
($3,000,000). Distribution of deferred acquisition fees will be made
from net cash from operations and net proceeds from sale or
refinancing for a maximum of 15 years, or until the above limit is
met.
The present value of the deferred acquisition fee plus accrued
interest has been reflected in the accompanying financial statements
and has been capitalized as part of the cost of rental property
acquired. In March 1994, the Partnership paid approximately
$2,300,000 to the corporate general partner from refinancing proceeds.
The amount outstanding as of June 30, 1995 was approximately $630,000.
The Partnership reimburses NAPICO for certain expenses. The
reimbursement to NAPICO of $5,352 was paid and included in the
Partnership's operating expenses in the six months ended June 30,
1995.
NOTE 5 - CONTINGENCIES
The corporate general partner of the Partnership is a plaintiff in
various lawsuits and has also been named as defendant in other
lawsuits arising from transactions in the ordinary course of business.
In the opinion of management and the corporate general partner, the
claims will not result in any material liability to the Partnership.
7
<PAGE> 10
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
JUNE 30, 1995
ITEM 2. MANAGEMENT'S ANALYSIS AND DISCUSSION AND ANALYSIS OF FINANCIAL
POSITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
The Partnership was formed to invest in residential rental properties
either directly or through investments in joint ventures and other
partnerships which will invest in such real estate. The six buildings
owned by the Partnership were acquired at various dates during 1984
and 1985.
The Partnership's primary sources of funds are income from rental
operations and interest income earned on cash reserves.
Distributions of net cash from operations were normally intended to be
made to the Limited Partners of record on a quarterly basis during the
months of February, May, August, and November pro rata in proportion
to the number of units held. The November 1994, February 1995 and May
1995 distributions to the limited partners were not made due to the
Partnership setting aside funds for losses incurred by REP as a result
of the January 17, 1995 earthquake in the Los Angeles area. The
Partnership will resume distributions to the limited partners once
sufficient funds are in cash reserves to repair such earthquake
damage.
The mortgage on the Arbor Glen property matures in April 1996. The
Partnership has submitted applications to refinance the property, and
it is anticipated that the Partnership will obtain a new loan bearing
interest at a fixed rate of aprpoximately 8.2% with a ten year term,
amortized over 30 years. There can be no assurance, however, that a
new mortgage will be obtained or that the current mortgagor will
extend the term of the existing mortgage.
RESULTS OF RENTAL OPERATIONS
Occupancy at the Parkside property averaged 86 percent during the
first six months of 1995, a 6 percent decrease from the same period
in 1994. The low occupancy has resulted in a decrease in cash flows
for the period. In order to mitigate the ongoing deficit operations
at the property, the Partnership submitted a letter to the lender on
the Parkside property on April 27, 1995, requesting an interest rate
reduction and an extended maturity date on the mortgage. The
Partnership withheld the May, June and July mortgage payments and a
default letter dated May 24, 1995 was received from the lender. The
lender is reviewing the request for a loan modification. There can be
no assurance, however, that the lender will agree to an interest rate
reduction or that the mortgagor will extend the term of the existing
mortgage. The Partnership advanced $43,000 to the Parkside property
during the six months ended June 30, 1995. The property operated at a
deficit of approximately $36,000 during the six months ended June 30,
1995, after accruing for the unpaid interest on the mortgage.
Occupancy at the Warner Willows I & II properties averaged 97 percent
during the first six months of 1995, a 2 percent increase from the
same period in 1994. The combined expenses for both properties, with
the exception of interest expense (which increased as a result of the
1994 debt refinancing), remained
8
<PAGE> 11
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
JUNE 30, 1995
ITEM 2. MANAGEMENT'S ANALYSIS AND DISCUSSION AND ANALYSIS OF FINANCIAL
POSITION AND RESULTS OF OPERATIONS (CONTINUED)
RESULTS OF RENTAL OPERATIONS (CONTINUED)
consistent compared with the same period in 1994. The properties had
positive cash flows of approximately $21,300 and $16,800, respectively
for the six months ended June 30, 1995, after payments of
approximately $10,000 on each of the properties for earthquake damage.
See below for further discussion on the earthquake.
Occupancy at Arbor Glen averaged 94 percent during the first six
months of 1995, a 2 percent decrease from the same period in 1994.
The decrease in rental income, coupled with approximately $50,000 in
capital expenditures resulted in a decrease in cash flows compared
with the same period in 1994. Arbor Glen operated with positive cash
flows of approximately $17,300 during the first six months of 1995.
The mortgage on the property expires in April 1996.
Occupancy at the Park Creek property averaged 85 percent during the
first six months of 1995, a 7 percent decrease from the same period in
1994. Expenses are consistent when compared with same period in 1994.
The property operated with positive cash flows of approximately
$20,300 during the first six months of 1995, after payments for
earthquake damage of approximately $5,000. See below for further
discussion on earthquake damage.
Occupancy at the Willowbrook property averaged 96 percent during the
first six months of 1995, a 1 percent decrease for the same period in
1994. The property operated with positive cash flows of approximately
$58,600 for the period.
On January 17, 1994, the Park Creek and Warner Willows I and II rental
properties sustained damage, estimated at approximately $1,454,000,
due to the earthquake in the Los Angeles area. Insurance proceeds of
approximately $630,000 were allocated to the Partnership in 1994, as
the estimated full settlement under a master umbrella insurance policy
covering earthquake damage for these and other properties managed by a
related party. Included in liabilities at June 30, 1995 is
approximately $629,768 related to the earthquake damages. The total
estimated expenditures needed to repair the properties, net of the
insurance recoveries, which nets to approximately $824,000, were
expensed in the period ended December 31, 1994, since they did not
extend the useful life of the properties.
The Partnership operations consist primarily of interest income earned
on certificates of deposit and other temporary investments of funds
not required for investment in projects. The amount of interest
income varies with market rates available on certificates of deposit
and with the amount of funds available for investment.
Operating expenses of the Partnership consist substantially of
recurring general and administrative expenses and professional fees
for services rendered to the Partnership and interest on the deferred
acquisition fee due the General Partners.
9
<PAGE> 12
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
JUNE 30, 1995
ITEM 2. MANAGEMENT'S ANALYSIS AND DISCUSSION AND ANALYSIS OF FINANCIAL
POSITION AND RESULTS OF OPERATIONS (CONTINUED)
RESULTS OF RENTAL OPERATIONS (CONTINUED)
The Partnership is incurring interest expense at a rate of 8 percent
per annum on the unpaid fees due the general partner. Under the terms
of the Partnership Agreement, the Partnership is obligated to the
general partner for a deferred acquisition fee for services rendered
in connection with the selection, purchase, development, management
and monitoring the operations of the properties, in an amount which,
when calculated on a present value basis (using a discount factor of 8
percent for this purpose) from the date of payment to the general
partners to September 27, 1984 equals 10 percent of the gross proceeds
of the offering ($3,000,000). Distribution of any part of this fee
from net cash from operations shall be subordinate to receipt by each
Limited Partner of an amount equal to a cumulative noncompounded 6
percent distribution. The acquisition fee distributed in any year
from net cash from operations shall not exceed an amount equal to 3
percent of investment in properties (approximately $600,000) plus any
proceeds from sale or refinancing of the properties. During 1987,
$762,000 was paid to the general partner for this fee. Of this
amount, $612,000 was generated from refinancing one of the mortgage
notes payable. Furthermore, in March, 1994, approximately $2,300,000
of the excess proceeds received from the Park Creek and Warner Willows
I and II refinancings were used to partially pay the deferred
acquisition fees due the general partner. As of June 30, 1995,
approximately $630,000 was outstanding.
An annual property management fee, which shall not in any event exceed
5 percent of gross revenues from each property under management, is
also payable to an affiliate of the corporate general partner.
10
<PAGE> 13
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
JUNE 30, 1995
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
As of June 30, 1995, the Partnership's corporate general partner was a
plaintiff or defendant in several lawsuits. None of these were related to the
Partnership.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) No exhibits are required per the provision of item 7 of
regulation S-K.
11
<PAGE> 14
REAL EQUITY PARTNERS
(A CALIFORNIA LIMITED PARTNERSHIP)
JUNE 30, 1995
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.
REAL EQUITY PARTNERS
(a California limited partnership)
By: National Partnership Investments Corp.
Corporate General Partner
Date: ______________________________________
By: ________________________________________
Bruce Nelson
President
Date: ______________________________________
By: ________________________________________
Shawn Horwitz
Executive Vice President and
Chief Financial Officer
12
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
PARTNERSHIP'S STATEMENTS OF EARNINGS AND BALANCE SHEETS AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> JUN-30-1995
<CASH> 1,143,790
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,314,604
<PP&E> 38,060,926
<DEPRECIATION> 14,042,313
<TOTAL-ASSETS> 26,333,217
<CURRENT-LIABILITIES> 1,112,428
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 6,476,894
<TOTAL-LIABILITY-AND-EQUITY> 26,333,217
<SALES> 0
<TOTAL-REVENUES> 2,823,222
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,182,939
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 913,624
<INCOME-PRETAX> (273,341)
<INCOME-TAX> 0
<INCOME-CONTINUING> (273,341)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (273,341)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
