UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the period ended June 30, 1997
-----------------------------------------------------
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 0-14268
--------
MCNEIL REAL ESTATE FUND XXII, L.P.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
California 33-0085680
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
13760 Noel Road, Suite 600, LB70, Dallas, Texas, 75240
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (972) 448-5800
------------------------------
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 and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---
<PAGE>
MCNEIL REAL ESTATE FUND XXII, L.P.
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
- ------- --------------------
BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
--------------- --------------
ASSETS
- -------
Real estate investments:
<S> <C> <C>
Land..................................................... $ 380,414 $ 380,414
Buildings and improvements............................... 10,141,473 10,084,053
-------------- -------------
10,521,887 10,464,467
Less: Accumulated depreciation.......................... (5,362,823) (5,145,775)
-------------- -------------
5,159,064 5,318,692
Cash and cash equivalents................................... 887,300 602,462
Cash segregated for security deposits....................... 67,175 66,510
Accounts receivable......................................... 11,166 4,614
Escrow deposits............................................. 74,264 160,642
Prepaid expenses and other assets........................... 9,953 11,445
-------------- -------------
$ 6,208,922 $ 6,164,365
============== =============
LIABILITIES AND PARTNERS' DEFICIT
- ---------------------------------
Mortgage note payable, net.................................. $ 5,954,550 $ 5,979,501
Accounts payable and accrued expenses....................... 85,519 90,572
Accrued property taxes ..................................... 100,500 66,427
Payable to affiliates - General Partner..................... 1,829,448 1,756,367
Security deposits and deferred rental revenue............... 74,514 65,571
-------------- -------------
8,044,531 7,958,438
-------------- -------------
Partners' deficit:
Limited partners - 55,000,000 Units authorized;
32,815,117 and 33,176,117 Units issued and outstanding
at June 30, 1997 and December 31, 1996, respectively
(19,567,088 and 19,688,088 Current Income Units
outstanding at June 30, 1997 and December 31, 1996,
respectively, and 13,248,029 and 13,310,029 Growth/
Shelter Units outstanding at June 30, 1997 and December
31, 1996, respectively)................................ (1,582,277) (1,541,156)
General Partner.......................................... (253,332) (252,917)
-------------- -------------
(1,835,609) (1,794,073)
-------------- -------------
$ 6,208,922 $ 6,164,365
============== =============
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND XXII, L.P.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------------------- ---------------------------------
1997 1996 1997 1996
-------------- --------------- -------------- --------------
Revenue:
<S> <C> <C> <C> <C>
Rental revenue................ $ 586,276 $ 560,146 $ 1,144,699 $ 1,116,301
Interest...................... 8,956 8,131 17,660 15,825
------------- ------------- ------------- -------------
Total revenue............... 595,232 568,277 1,162,359 1,132,126
------------- ------------- ------------- -------------
Expenses:
Interest...................... 135,388 145,572 274,151 291,506
Depreciation and
amortization................ 110,288 106,406 217,048 208,964
Property taxes................ 50,250 50,876 100,500 93,848
Personnel costs............... 63,571 68,160 142,527 152,354
Utilities..................... 31,316 26,338 79,820 69,148
Repair and maintenance........ 74,100 66,757 138,928 118,872
Property management
fees - affiliates........... 29,013 28,029 56,978 55,601
Other property operating
expenses.................... 25,765 25,117 52,731 51,865
General and administrative.... 17,639 26,301 39,152 41,788
General and administrative -
affiliates.................. 54,156 58,771 102,060 115,257
------------- ------------- ------------- -------------
Total expenses.............. 591,486 602,327 1,203,895 1,199,203
------------- ------------- ------------- -------------
Net income (loss)................ $ 3,746 $ (34,050) $ (41,536) $ (67,077)
============= ============= ============= =============
Net income (loss) allocable
to limited partners - Current
Income Unit................... $ 337 $ (3,064) $ (3,738) $ (6,037)
Net income (loss) allocable
to limited partners - Growth
Shelter Unit.................. 3,371 (30,645) (37,383) (60,369)
Net income (loss) allocable
to General Partner............ 38 (341) (415) (671)
------------- ------------- ------------- -------------
Net income (loss)................ $ 3,746 $ (34,050) $ (41,536) $ (67,077)
============= ============= ============= =============
Net income (loss) per thousand
limited partnership units:
Current Income Units............. $ .02 $ (.15) $ (.19) $ (.30)
============= ============= ============= =============
Growth/Shelter Units............. $ .25 $ (2.29) $ (2.82) $ (4.52)
============= ============= ============= =============
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND XXII, L.P.
STATEMENTS OF PARTNERS' DEFICIT
(Unaudited)
For the Six Months Ended June 30, 1997 and 1996
<TABLE>
<CAPTION>
Total
General Limited Partners'
Partner Partners Deficit
--------------- --------------- ---------------
<S> <C> <C> <C>
Balance at December 31, 1995.............. $ (250,709) $ (1,168,315) $ (1,419,024)
Net loss
General Partner........................ (671) - (671)
Current Income Units................... - (6,037) (6,037)
Growth/Shelter Units................... - (60,369) (60,369)
------------- ------------- -------------
Total net loss............................ (671) (66,406) (67,077)
------------- ------------- -------------
Balance at June 30, 1996.................. $ (251,380) $ (1,234,721) $ (1,486,101)
============= ============= =============
Balance at December 31, 1996.............. $ (252,917) $ (1,541,156) $ (1,794,073)
Net loss
General Partner........................ (415) - (415)
Current Income Units................... - (3,738) (3,738)
Growth/Shelter Units................... - (37,383) (37,383)
------------- ------------- -------------
Total net loss............................ (415) (41,121) (41,536)
------------- ------------- -------------
Balance at June 30, 1997.................. $ (253,332) $ (1,582,277) $ (1,835,609)
============= ============= =============
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND XXII, L.P.
STATEMENTS OF CASH FLOWS
(Unaudited)
Increase in Cash and Cash Equivalents
<TABLE>
<CAPTION>
Six Months Ended
June 30,
------------------------------------------
1997 1996
------------------ ----------------
Cash flows from operating activities:
<S> <C> <C>
Cash received from tenants........................ $ 1,145,368 $ 1,127,749
Cash paid to suppliers............................ (376,140) (487,610)
Cash paid to affiliates........................... (85,957) (55,091)
Interest received................................. 17,660 15,825
Interest paid..................................... (254,989) (273,137)
Property taxes paid and escrowed.................. (59,312) (64,448)
---------------- --------------
Net cash provided by operating activities............ 386,630 263,288
---------------- --------------
Net cash used in investing activities:
Additions to real estate investments.............. (57,420) (147,806)
----------------- --------------
Net cash used in financing activities:
Principal payments on mortgage note
payable......................................... (44,372) (41,382)
----------------- --------------
Net increase in cash and cash equivalents............ 284,838 74,100
Cash and cash equivalents at beginning of
period............................................ 602,462 629,747
---------------- --------------
Cash and cash equivalents at end of period........... $ 887,300 $ 703,847
================ ==============
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND XXII, L.P.
STATEMENTS OF CASH FLOWS
(Unaudited)
Reconciliation of Net Loss to Net Cash Provided by
Operating Activities
<TABLE>
<CAPTION>
Six Months Ended
June 30,
-----------------------------------------
1997 1996
----------------- ----------------
<S> <C> <C>
Net loss............................................. $ (41,536) $ (67,077)
--------------- --------------
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and amortization..................... 217,048 208,964
Amortization of discounts on mortgage
note payable.................................... 19,421 18,610
Changes in assets and liabilities:
Cash segregated for security deposits........... (665) 10,659
Accounts receivable............................. (6,552) (2,110)
Escrow deposits................................. 86,378 (4,429)
Prepaid expenses and other assets............... 1,492 96
Accounts payable and accrued expenses........... (5,053) (42,849)
Accrued property taxes.......................... 34,073 27,947
Payable to affiliates - General Partner......... 73,081 115,766
Security deposits and deferred rental
revenue....................................... 8,943 (2,289)
--------------- --------------
Total adjustments............................. 428,166 330,365
--------------- --------------
Net cash provided by operating activities............ $ 386,630 $ 263,288
=============== ==============
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
MCNEIL REAL ESTATE FUND XXII, L.P.
Notes to Financial Statements
(Unaudited)
June 30, 1997
NOTE 1.
- -------
McNeil Real Estate Fund XXII, L.P., (the "Partnership"), formerly known as
Southmark Realty Partners II, Ltd., was organized on November 30, 1984 as a
limited partnership under the provisions of the California Revised Limited
Partnership Act to acquire and operate commercial and residential properties.
The general partner of the Partnership is McNeil Partners, L.P. (the "General
Partner"), a Delaware limited partnership, an affiliate of Robert A. McNeil
("McNeil"). The principal place of business for the Partnership and the General
Partner is 13760 Noel Road, Suite 600, LB70, Dallas, Texas, 75240.
In the opinion of management, the financial statements reflect all adjustments
necessary for a fair presentation of the Partnership's financial position and
results of operations. All adjustments were of a normal recurring nature.
However, the results of operations for the six months ended June 30, 1997 are
not necessarily indicative of the results to be expected for the year ending
December 31, 1997.
NOTE 2.
- -------
The financial statements should be read in conjunction with the financial
statements contained in the Partnership's Annual Report on Form 10-K for the
year ended December 31, 1996, and the notes thereto, as filed with the
Securities and Exchange Commission, which is available upon request by writing
to McNeil Real Estate Fund XXII, L.P., c/o The Herman Group, 2121 San Jacinto
St., 26th Floor, Dallas, Texas 75201.
NOTE 3.
- -------
The accompanying financial statements have been prepared assuming that the
Partnership will continue as a going concern. The Partnership has suffered
recurring losses from operations and the Partnership's only property is in need
of major capital improvements in order to maintain occupancy and rental rates at
a level to continue to support operations and debt service.
While the Partnership has begun a program to complete such capital improvements
to be funded from existing cash reserves, there can be no assurances that such
reserves will be sufficient to complete all needed improvements.
These conditions raise substantial doubt about the Partnership's ability to
continue as a going concern. The financial statements do not include any
adjustments that might result from the outcome of these uncertainties.
NOTE 4.
- -------
<PAGE>
The Partnership pays property management fees equal to 5% of the gross rental
receipts for its residential property to McNeil Real Estate Management, Inc.
("McREMI"), an affiliate of McNeil, for providing property management and
leasing services.
The Partnership reimburses McREMI for its costs, including overhead, of
administering the Partnership's affairs.
The Partnership is incurring an asset management fee which is payable to the
General Partner. Through 1999, the asset management fee is calculated as 1% of
the Partnership's tangible asset value. Tangible asset value is determined by
using the greater of (i) an amount calculated by applying a capitalization rate
of 9% to the annualized net operating income of each property or (ii) a value of
$10,000 per apartment unit for residential property to arrive at the property
tangible asset value. The property tangible asset value is then added to the
book value of all other assets excluding intangible items. The fee percentage
decreases subsequent to 1999. Total accrued but unpaid asset management fees of
$1,206,054 were outstanding at June 30, 1997.
Compensation and reimbursements paid to or accrued for the benefit of the
General Partner and its affiliates are as follows:
Six Months Ended
June 30,
-------------------------
1997 1996
--------- ----------
Property management fees..................... $ 56,978 $ 55,601
Charged to general and administrative -
affiliates:
Partnership administration................ 31,284 45,474
Asset management fee...................... 70,776 69,783
-------- --------
$ 159,038 $ 170,858
======== ========
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
- ------- ----------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The Partnership was provided $386,630 of cash by operating activities during the
first six months of 1997 as compared to $263,288 for the same period in 1996.
Cash paid to suppliers decreased by $111,470 mainly due to a receipt of $83,000
for property replacements from escrow previously held by HUD, the former
mortgage holder of Harbour Club III Apartments. Cash paid to affiliates
increased by $30,866 due to the resumption of overhead payments to an affiliate
of the General Partner for administering the Partnership's affairs in 1997.
Cash used for additions to real estate was $57,420 during the first six months
of 1997 as compared to $147,806 during the same period of 1996. A greater amount
was spent in 1996 at Harbour Club III for paving and hallway upgrades. In
addition, the replacement of appliances, which met the Partnership's criteria
for capitalization of replacements in 1996, were expensed in 1997.
<PAGE>
Cash used for principal payments on mortgage note payable was $44,372 during the
first six months of 1997 as compared to $41,382 for the same period of 1996.
Short-term liquidity:
At June 30, 1997, the Partnership held $887,300 of cash and cash equivalents.
The General Partner considers this level of cash reserves to be adequate to meet
the Partnership's operating needs. The General Partner believes that anticipated
operating results for 1997 will be sufficient to fund the Partnership's budgeted
capital improvements for 1997 and to repay the current portion of the
Partnership's mortgage note. Effective January 23, 1997, the mortgage note
payable was sold by HUD to an unaffiliated buyer.
Long-term liquidity:
The Partnership determined to evaluate market and other economic conditions to
establish the optimum time to commence liquidation of the Partnership's asset in
accordance with the terms of the Amended Partnership Agreement. Although there
can be no assurance as to the timing of the liquidation due to real estate
market conditions, the general difficulty of disposing of real estate, and other
general economic factors, it is anticipated that such liquidation would result
in the dissolution of the Partnership followed by a liquidating distribution to
Unit holders by December 2001.
Distributions:
To maintain adequate cash balances of the Partnership, distributions to Current
Income Unit holders were suspended in 1988. There have been no distributions to
Growth/Shelter Units holders. Distributions to Unit holders will remain
suspended for the foreseeable future. The General Partner will continue to
monitor the cash reserves and working capital needs of the Partnership to
determine when cash flows will support distributions to the Unit holders.
FINANCIAL CONDITION
- -------------------
The occupancy rate at Harbour Club III Apartments was 96% at June 30, 1997. The
occupancy rate at December 31, 1996, was 94%. Harbour Club III Apartments was
able to provide enough cash flow from operations to meet ordinary operating
expenses as well as the debt service for its related mortgage note for the first
six months of 1997. The property is in need of major capital improvements in
order to compete in its local market, and the Partnership has begun a program to
complete such capital improvements to be funded from existing cash reserves.
However, there can be no assurances that such reserves will be sufficient to
complete all needed improvements.
Harbour Club III is part of a four-phase apartment complex located in
Belleville, Michigan. Phases I and II of the complex are owned by partnerships
in which McNeil Partners, L.P. is the general partner; while Phase IV is owned
by an unaffiliated Partnership. McREMI had been managing all four phases of the
complex until December 1992, when the property management agreement between
McREMI and the unaffiliated Partnership was canceled. Additionally, in January
1993, Phase I defaulted on the mortgage loan to HUD, the former mortgage holder.
In the beginning of July 1997, the mortgage note was reinstated after Phase I
has made all the delinquent payments and late charges. Regular monthly mortgage
payment was resumed in July 1997.
<PAGE>
RESULTS OF OPERATIONS
- ---------------------
Revenue:
Total Partnership revenues increased by $26,955 and $30,233 for the three and
six months ended June 30, 1997, respectively, as compared to the same periods of
1996. Rental revenue was $586,276 and $1,144,699 for the three and six months
ended June 30, 1997, respectively, and remained comparable to $560,146 and
$1,116,301 for the same periods in 1996. Interest income for the first six
months of 1997 increased slightly by $1,835 as compared to prior period.
Expenses:
Total expenses decreased by $10,841 for the three months ended June 30, 1997 and
increased by $4,692 for the six months ended June 30, 1997, as compared to the
same periods in 1996.
Utilities increased $4,978 and $10,672 for the three and six months ended June
30, 1997, respectively, as compared to the same periods of 1996 due to increased
electricity usage at Harbour Club III Apartments.
Repairs and maintenance expense increased by $7,343 and $20,056 for the three
and six months ended June 30, 1997, respectively, as compared to the same
periods of last year. The increase can be attributed to an increase in the
replacement of appliances, which met the Partnership's criteria for
capitalization of replacements in 1996, but were expensed in 1997.
General and administrative expenses decreased by $8,662 and $2,636 for the three
and six months ended June 30, 1997, respectively, as compared to the same
periods of 1996. The decrease was primarily due to decreased legal fees relating
to the rescission of Partnership Units in 1996. The decrease was partially
offset by the costs incurred for investor services which were paid to an
unrelated third party in 1997. During the first six months of 1996, such costs
were paid to an affiliate of the General Partner and were included in general
and administrative - affiliates on the Statement of Operations.
General and administrative - affiliates decreased $4,615 and $13,197 for the
three and six months ended June 30, 1997, respectively, as compared to the same
periods of 1996. This was attributable to costs of investor services discussed
above.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
- ------- -----------------
James F. Schofield, Gerald C. Gillett, Donna S. Gillett, Jeffrey Homburger,
Elizabeth Jung, Robert Lewis, and Warren Heller et al. v. McNeil Partners L.P.,
McNeil Investors, Inc., McNeil Real Estate Management, Inc., Robert A. McNeil,
Carole J. McNeil, McNeil Pacific Investors Fund 1972, Ltd., McNeil Real Estate
Fund IX, Ltd., McNeil Real Estate Fund X, Ltd., McNeil Real Estate Fund XI,
Ltd., McNeil Real Estate Fund XII, Ltd., McNeil Real Estate Fund XIV, Ltd.,
McNeil Real Estate Fund XV, Ltd., McNeil Real Estate Fund XX, L.P., McNeil Real
Estate Fund XXI, L.P., McNeil Real Estate Fund XXII, L.P., McNeil Real Estate
Fund XXIV, L.P., McNeil Real Estate Fund XXV, L.P., McNeil Real Estate Fund
XXVI, L.P., and McNeil Real Estate Fund XXVII, L.P., et al. - Superior Court of
the State of California for the County of Los Angeles, Case No. BC133799 (Class
and Derivative Action Complaint).
<PAGE>
The action involves purported class and derivative actions brought by limited
partners of each of the fourteen limited partnerships that were named as nominal
defendants as listed above (the "Partnerships"). Plaintiffs allege that McNeil
Investors, Inc., its affiliate McNeil Real Estate Management, Inc. and three of
their senior officers and/or directors (collectively, the "Defendants") breached
their fiduciary duties and certain obligations under the respective Amended
Partnership Agreement. Plaintiffs allege that Defendants have rendered such
Units highly illiquid and artificially depressed the prices that are available
for Units on the resale market. Plaintiffs also allege that Defendants engaged
in a course of conduct to prevent the acquisition of Units by an affiliate of
Carl Icahn by disseminating purportedly false, misleading and inadequate
information. Plaintiffs further allege that Defendants acted to advance their
own personal interests at the expense of the Partnerships' public unit holders
by failing to sell Partnership properties and failing to make distributions to
unitholders.
On December 16, 1996, the Plaintiffs filed a consolidated and amended complaint.
Plaintiffs are suing for breach of fiduciary duty, breach of contract and an
accounting, alleging, among other things, that the management fees paid to the
McNeil affiliates over the last six years are excessive, that these fees should
be reduced retroactively and that the respective Amended Partnership Agreements
governing the Partnerships are invalid.
Defendants filed a demurrer to the consolidated and amended complaint and a
motion to strike on February 14, 1997, seeking to dismiss the consolidated and
amended complaint in all respects. A hearing on Defendant's demurrer and motion
to strike was held on May 5, 1997. The Court granted Defendants' demurrer,
dismissing the consolidated and amended complaint with leave to amend.
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- ------- --------------------------------
(a) Exhibits.
Exhibit
Number Description
4. Amended and Restated Limited Partnership
Agreement dated March 26, 1992.
(Incorporated by reference to the Current
Report of the Registrant on Form 8-K dated
March 26, 1992, as filed on April 9, 1992).
11. Statement regarding computation of Net
Income (Loss) per Thousand Limited
Partnership Units: Net income (loss) per
thousand limited partnership units is
computed by dividing net income (loss)
allocated to the limited partners by the
weighted average number of limited
partnership units outstanding expressed in
thousands. Per unit information has been
computed based on 19,567 and 19,818 weighted
average Current Income Units (in thousands)
outstanding in 1997 and 1996, respectively,
and 13,248 and 13,358 weighted average
Growth/Shelter Units (in thousands)
outstanding in 1997 and 1996, respectively.
27. Financial Data Schedule for the quarter
ended June 30, 1997.
(b) Reports on Form 8-K. There were no reports on Form 8-K filed during
the quarter ended June 30, 1997.
<PAGE>
MCNEIL REAL ESTATE FUND XXII, L.P.
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:
McNEIL REAL ESTATE FUND XXII, L.P.
By: McNeil Partners, L.P., General Partner
By: McNeil Investors, Inc., General Partner
August 13, 1997 By: /s/ Ron K. Taylor
- --------------- ------------------------------------------
Date Ron K. Taylor
President and Director of McNeil
Investors, Inc.
(Principal Financial Officer)
August 13, 1997 By: /s/ Carol A. Fahs
- --------------- ------------------------------------------
Date Carol A. Fahs
Vice President of McNeil Investors, Inc.
(Principal Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 887,300
<SECURITIES> 0
<RECEIVABLES> 11,166
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 10,521,887
<DEPRECIATION> (5,362,823)
<TOTAL-ASSETS> 6,208,922
<CURRENT-LIABILITIES> 0
<BONDS> 5,954,550
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 6,208,922
<SALES> 1,144,699
<TOTAL-REVENUES> 1,162,359
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 929,744
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 274,151
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> (41,536)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (41,536)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
