<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------
FORM 10-QSB
-----------
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1997
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT
For the transition period from to
------------ -------------
Commission file number 0-13969
JOHN ADAMS LIFE CORPORATION
- --------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
California 95-4081667
- -------------------------------- ------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
11845 W. Olympic Boulevard, Suite 905, Los Angeles, California 90064
- --------------------------------------------------------------------
(Address of principal executive offices)
Issuer's telephone number:
(310) 444-5252
Former Address: Not Applicable
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 X No
---- -----
The number of shares outstanding of the issuer's common stock (no par
value) as of May 12, 1997, was 2,864,700.
Transitional Small Business Disclosure Format (check one):
Yes No X
---- ----
<PAGE> 2
JOHN ADAMS LIFE CORPORATION
FORM 10-QSB
MARCH 31, 1997
<TABLE>
<CAPTION>
INDEX
PAGE NO.
PART I. FINANCIAL INFORMATION
<S> <C> <C>
Item 1. Financial Statements
Consolidated Balance Sheet - March 31, 1997
(Unaudited) 3
Consolidated Statements of Operations -
Three months ended March 31, 1997 and 1996
(Unaudited) 4
Consolidated Statements of Cash Flows -
Three months ended March 31, 1997 and 1996
(Unaudited) 5
Notes to Consolidated Financial Statements
(Unaudited) 6
Item 2. Management's Discussion and Analysis
of Financial Condition and Results
of Operations 8
PART II. OTHER INFORMATION 9
</TABLE>
2
<PAGE> 3
JOHN ADAMS LIFE CORPORATION
CONSOLIDATED BALANCE SHEET--MARCH 31, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
ASSETS
CASH AND INVESTMENTS:
<S> <C>
CASH ............................................ $ 131,721
BONDS AVAILABLE FOR SALE AT FAIR VALUE
(AMORTIZED COST OF $2,269,535) .................. 2,001,555
-----------
2,133,276
COMMISSIONS RECEIVABLE .......................... 950,000
ACCOUNTS RECEIVABLE ............................. 21,127
ACCRUED INVESTMENT INCOME ....................... 1,336
OTHER CURRENT ASSETS ............................ 74,328
-----------
Total assets ................................ $ 3,180,067
===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
OTHER LIABILITIES ............................... $ 212,473
-----------
Total current liabilities ................... 212,473
-----------
CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, no par value--
Authorized--5,000,000 shares; no shares
outstanding ............................... --
Common stock, no par value--
Authorized--15,000,000 shares
Issued and Outstanding--2,864,700 shares .... 6,254,547
Net unrealized loss on bonds available for sale (267,980)
Retained earnings - deficit ................... (3,018,973)
-----------
2,967,594
-----------
Total liabilities and shareholders' equity .. $ 3,180,067
===========
</TABLE>
The accompanying notes are an integral part of these statements.
3
<PAGE> 4
JOHN ADAMS LIFE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996 (UNAUDITED)
<TABLE>
<CAPTION>
1997 1996
------------------- -------------------
REVENUES:
<S> <C> <C>
Commissions........................... $ 119,744 $ 357,541
Other Income........................... 24,999 1,357
------------------- -------------------
144,743 358,898
EXPENSES:
Commissions............................ - 278,251
General and Administrative............. 186,039 89,128
------------------- -------------------
186,039 367,379
------------------- -------------------
Loss from Continuing Operations............ (41,296) (8,481)
Loss from Discontinued Operations.......... (62,764) (127,799)
------------------- -------------------
Net Loss................................... $ (104,060) $ (136,280)
=================== ===================
Per share information:
Loss from continuing operations........... $ (0.01) $ 0.00
Loss from discontinued operations......... (0.03) (0.05)
------------------- -------------------
Net Loss....................................... $ (0.04) $ (0.05)
=================== ===================
</TABLE>
The accompanying notes are an integral part of these statements.
4
<PAGE> 5
JOHN ADAMS LIFE CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1997 AND 1996 (UNAUDITED)
<TABLE>
<CAPTION>
CASH FLOWS FROM OPERATING ACTIVITIES: 1997 1996
---- ----
<S> <C> <C>
Net loss .......................................................... $(104,060) $(136,280)
Adjustments to reconcile net loss to net cash provided by (used in)
operating activities:
Loss from discontinued operation ................................ 62,764 127,799
Realized investment losses ...................................... 22,149 --
Changes in assets and liabilities:
Accounts receivable ............................................. 7,683 (14,846)
Other assets .................................................... (43,346) (236,075)
Accrued investment income ....................................... (70) 639
Amortization of unearned restricted stock compensation .......... -- 9,375
Other liabilities ............................................... (115,611) 227,424
Other items ..................................................... 18,494 --
--------- ---------
Net cash used in continuing operations .......................... (151,997) (21,964)
Net cash used in discontinued operation ................................ (42,764) (357,938)
--------- ---------
Net cash used in operating activities ........................... (194,761) (379,902)
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Sales, maturities and repayments of principal on
investments ................................................... 543,281 --
--------- ---------
Net cash provided by investing activities ......................... 543,281 --
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuing notes payable ............................... -- 377,000
Payments on notes payable ......................................... (243,429) --
--------- ---------
Net cash provided by (used in) financing activities ............... (243,429) 377,000
--------- ---------
INCREASE (DECREASE) IN CASH ............................................ 105,091 (2,902)
CASH AT BEGINNING OF YEAR .............................................. 26,630 16,224
--------- ---------
CASH AT END OF YEAR .................................................... $ 131,721 $ 13,322
========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
5
<PAGE> 6
JOHN ADAMS LIFE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1997
(UNAUDITED)
Summary of significant accounting policies
Basis of Presentation
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB. Accordingly,
they do not include all the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the opinion
of management, all adjustments (consisting only of normal accruals) considered
necessary for a fair presentation have been included. In addition, these
accounting principles differ in certain material respects from the accounting
practices prescribed by various insurance regulatory authorities. The results of
operations for the three months ended March 31, 1997, are not necessarily
indicative of the results to be expected for the full year. The accompanying
unaudited consolidated financial statements should be read in conjunction with
the audited consolidated financial statements for the year ended December 31,
1996, contained in the Company's 1996 Annual Report to Shareholders. Certain
items have been reclassified to conform to the current year's presentation.
Bonds
Bonds available for sale are carried at aggregate market value, with net
unrealized holding losses charged directly to shareholders' equity. The change
in net unrealized holding loss on bonds available for sale charged to
shareholders' equity was $268,000 for the three months ended March 31, 1997.
Realized gains and losses on the sale of bonds are recognized in operations at
the date of sale and are determined using the specific cost identification
method, in accordance with the Statement of Financial Accounting Standards No.
115, "Accounting for Certain Investments in Debt and Equity Securities."
Income taxes
The adoption of Statement of Financial Accounting Standards No. 109 "Accounting
for Income Taxes" did not have a material effect on the financial position or
results of operations of the Company, in the first three months of 1997.
6
<PAGE> 7
Earnings per share
Earnings per share are computed on the basis of the weighted average number of
shares outstanding during each year. The calculation of the weighted average
number of shares outstanding includes the effect of stock equivalents arising
from the Company's repurchase of its stock and the issuance of restricted stock.
Weighted average shares outstanding totaled 2,864,700, at March 31, 1997 and
1996. The impact of stock options was not dilutive.
Reclassifications
The 1996 financial statements have been reclassified to conform to the
discontinued operations accounting adopted in 1996.
7
<PAGE> 8
JOHN ADAMS LIFE CORPORATION
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
In January 1997, John Adams Life Corporation (the "Company") completed
the sale to Unified Life Insurance Company ("Unified") of the 49,803.16 shares
(99.6%) of the Common Stock (the "Shares") of John Adams Life Insurance Company
of America ("JALIC") owned by the Company. As a result of the sale, the Company
through its wholly-owned subsidiary, Firingline Corporation, operates as a life
insurance sales agency.
Liquidity and Capital Resources
The adjusted net proceeds from the sale of JALIC after deducting the
amounts due from the Company to JALIC were approximately $2,600,000. This does
not include the estimated present value of $950,000 for additional commissions
from JALIC; the additional commissions represent a 35% commission to be paid by
Unified to Firingline on certain JALIC life insurance policies. The maximum
aggregate amount of these additional commissions, which are to be paid to
Firingline as earned over the three-year period, 1997 through 1999, is
$1,200,000. Firingline will also continue to be paid renewal commissions on the
JALIC policies transferred to Unified. The amounts of any renewal commissions
and any additional commissions are primarily dependent upon the persistency of
the policies and there is no guarantee that any renewal commissions or
additional commissions will be earned.
Discontinued Operations
The sale of JALIC, the Company's discontinued operations, closed in
January 1997, and the Company incurred expenses in the amount of approximately
$63,000 during the first quarter of 1997 in connection with its discontinued
operations.
Results of Continuing Operations
Comparison of the three month periods ended March 31, 1997 and 1996.
The net loss in the first quarter of 1997, from the Company's
continuing operations totaled $41,000 or $.01 per share compared to a net loss
from continuing operations of $8,500 or $.00 per share for the comparable period
of 1996.
The net loss in the first quarter of 1997 from discontinued and
continuing operations totaled $104,000 or $.04 per share compared to a net loss
of $136,000 or $.05 per share for discontinued and continuing operations in the
first quarter of 1996.
8
<PAGE> 9
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The Company is not involved in any legal proceedings that in
management's opinion could result in a material adverse effect
on the Company's financial condition or results of operation.
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 -
Not applicable.
Item 5. Other Information
On January 22, 1997, John Adams Life Corporation (the
"Company") completed the sale to Unified Life Insurance
Company ("Unified") of the 49,803.16 shares of Common Stock
(the "Shares") of John Adams Life Insurance Company of America
("JALIC") owned by the Company. The Shares comprise 99.6% of
the issued and outstanding shares of common stock of JALIC.
The purchase price for the shares based on the formula set
forth in the Stock Purchase Agreement dated October 24, 1996,
as amended, between the Company and Unified (the "Stock
Purchase Agreement") as determined by JALIC's statutory
insurance accounting data was $2,970,893. This amount does not
include adjustments for intercompany debts and related items,
which have been paid by the Company. The net proceeds after
the payment were approximately $2,600,000.
Item 6. Exhibits and Reports on Form 8-K
(a) Reports on Form 8-K: On February 5, 1997, the
Company filed a report on Form 8-K, dated February 5,
1997; the item reported on this form is the January
22, 1997, closing of the sale of the 49,803.16 shares
(99.6%) of the outstanding and issued capital stock
of John Adams Life Insurance Company of America owned
by the Company to Unified Life Insurance Company.
9
<PAGE> 10
(b) Exhibits
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------ -----------
<S> <C>
2.1 Agreement and Plan of Reorganization with
Firingline Corporation (1)
3.1 Amended and Restated Articles of Incorporation (2)
3.2 Bylaws (8)
3.5 Amendments to Bylaws (8)
4.1 See Articles 3(b), 5 and 6 of Amended
Articles of Incorporation (Exhibit 3.1) (2)
4.2 See Article 2 and Section 8.06 of the Bylaws
(Exhibit 3.2) (8)
4.3 Specimen Form of Common Stock Certificate (1)
10.1 Agreement and Plan of Reorganization
(see Exhibit 2.1) (1)
10.2 * Supervising General Agent's Commission Agreement
between JALIC and Ozco Insurance Services, Inc.,
assigned to Firingline Corporation in June 1985 (1)
10.8 Shareholder Loan Restructuring Agreement (1)
10.10 Lease Agreement with Westside Associates, Ltd. (2)
10.14 * 1990 Stock Option Plan (3)
10.15 * 1990 Non-Employee Director Stock Option Plan (3)
10.16 * 1991 Employment Agreement with Benjamin A. DeMotto (4)
10.17 * 1985 Incentive Stock Option Plan (with 1991 Amendment) (5)
10.18 * 1990 Stock Option Plan (with 1991 Amendment) (5)
10.19 * 1990 Non-Employee Director Stock Option Plan (with 1991
Amendment) (5)
10.21 * 1994 Employment Agreement with Benjamin A. DeMotto (6)
10.23 Promissory Note dated January 24, 1996, issued to Benjamin A.
DeMotto for a loan (9)
10.24 Promissory Note dated February 9, 1996, issued to Benjamin A.
DeMotto, for a loan (9)
10.25 Letter of intent, dated June 7, 1996, for the sale of JALIC
to Unified Life Insurance Company (10)
10.26 Stock Purchase Agreement, signed October 24, 1996, by and
between Unified Life Insurance Company and John Adams Life
Corporation (11)
10.27 * Amendment, signed October 22, 1996,to Supervising General
Agents Commission Agreement (11)
10.28 Revised Life Coinsurance Treaty with Funds Withheld, effective
July 1, 1996, between JALIC and Unified Life Insurance Company
and Amendment No. 1 (12)
10.29 Addendum No. 5 to Lease Agreement with Westside Associates,
Ltd. (13)
16.1 Letter from Price Waterhouse LLP, dated December 21, 1994,
regarding change of independent auditors (7)
21.1 List of Subsidiaries (1)
- ----------------------------
</TABLE>
10
<PAGE> 11
<TABLE>
<CAPTION>
<S> <C>
( 1) Previously filed with Registrant's Registration Statement No.
2-99302 on Form S-1, effective September 18, 1985. **
( 2) Previously filed with Registrant's Report on Form 10-Q for the
quarter ending June 30, 1988. **
( 3) Previously filed with Registrant's Report on Form 10-Q for the
quarter ending September 30, 1990. **
( 4) Previously filed with Registrant's Report on Form 10-Q for the
quarter ending June 30, 1991. **
( 5) Previously filed with Registrant's Report on Form 10-K for
the fiscal year ending December 31, 1991. **
( 6) Previously filed with Registrant's Report on Form 10-QSB for the
quarter ending September 30, 1994. **
( 7) Previously filed with Registrant's Report on Form 8-K filed
December 23, 1994. **
( 8) Previously filed with Registrant's Report on Form 10-QSB for the
quarter ending March 31, 1995. **
( 9) Previously filed with Registrant's Report on Form 10-KSB for the
fiscal year ending December 31, 1995. **
(10) Previously filed with Registrant's Report on Form 8-K filed June
13, 1996. **
(11) Previously filed with Registrant's Report on Form 8-K filed
November 5, 1996. **
(12) Previously filed with Registrant's Report on Form 10-QSB for the
quarter ending September 30, 1996. **
(13) Filed herewith.
</TABLE>
* The documents filed or incorporated by reference as Exhibits 10.2,
10.14 through 10.19, 10.21 and 10.27 hereto constitute management
contracts or compensatory plans or arrangements.
** Incorporated by reference from the documents described above.
11
<PAGE> 12
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.
JOHN ADAMS LIFE CORPORATION
Date: May 12, 1997 By: Benjamin A. DeMotto
-------------------
Benjamin A. DeMotto
Chairman of the Board
and President
Date: May 12, 1997 By: Cathy Nitta
-----------
Cathy Nitta
Controller
12
<PAGE> 1
EXHIBIT 10.29
ADDENDUM NO. 5 TO
WESTSIDE TOWERS/JOHN ADAMS
OFFICE LEASE
THIS ADDENDUM NO. 5 TO WESTSIDE TOWERS/JOHN ADAMS OFFICE LEASE
("Addendum") is made as of February 7, 1997 between WESTSIDE ASSOCIATES, LTD.,
a California limited partnership ("Landlord"), and THE JOHN ADAMS LIFE
CORPORATION, a California corporation ("Tenant"), with reference to the
following facts:
A. Landlord and Tenant are parties to that certain Westside Towers
Office Lease dated as of August 19, 1986, as amended by Addendum No. 1 dated as
of August 20, 1986, Addendum No. 2 dated as of November 4, 1991, Addendum No. 3
dated as of June 30, 1992 and Addendum No. 4 dated as of June 15, 1993
(collectively the "Lease"), for those certain premises located at the street
address of Suite 905, 11845 W. Olympic Blvd., Los Angeles, California (the
"Premises").
B. Landlord and Tenant desire to provide for a decrease in the
Rentable Area of the Premises, an extension of the Lease Term and a change in
certain other terms of the Lease, as more particularly set forth herein.
C. The defined terms used in the Addendum shall have the meanings
set forth in the Lease, unless otherwise provided herein.
NOW, THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:
1. Term. The Lease Term shall be renewed, solely for the "New
Premises" as more particularly described herein, for a term (the "New Premises
Lease Term") commencing March 1, 1997 and ending February 28, 1998, unless
sooner terminated pursuant to the terms of the Lease or this Addendum. Prior to
the commencement of the New Premises Lease Term, Tenant shall continue to lease
the Reduced Premises from Landlord (consisting of approximately three thousand
seven hundred twenty seven (3,727) square feet of Rentable Area) on the terms
set forth in the Lease.
2. Renewal Premises. Pursuant to the terms of the Lease and this
Addendum, at all times during the New Premises Lease Term Tenant shall occupy a
portion of the Reduced Premises containing approximately 1,616 square feet of
Rentable Area on the ninth (9th) floor of the West Tower (the "New Premises") as
generally described on Exhibit C attached to this Addendum, incorporated herein
by reference.
3. Basic Monthly Rent.
a. Rental Rate. The Basic Monthly Rent for the New Premises
shall be Two Thousand Five Hundred Eighty Five and 60/100ths Dollars ($2,585.60)
per month throughout the New Premises Lease Term.
b. Rent Abatement. So long as Tenant does not continue in
default of its obligations under the Lease Agreement after the expiration
provided therein for any cure thereof, Tenant shall be entitled to abatement of
the Basic Monthly Rent with respect to the New Premises for the month of March
1997; provided, however, in the event of a default by Tenant under the terms of
the Lease or this Addendum, which default remains uncured after the expiration
of any applicable grace period, then as a part of the recovery set forth in
Section 18.2.A of the Lease, Landlord shall be entitled to the recovery of the
Basic Monthly Rent that was abated under the provisions of this Section 8, and
such Basic Monthly Rent shall not be deemed to have been
-1-
<PAGE> 2
forgiven or abated, but shall become immediately due and payable as unpaid Rent
which had been earned at the time of termination.
4. Tenant's Proportionate Share. During the New Premises Lease
Term, "Tenant's Proportionate Share", determined by dividing the Rentable Area
of the New Premises by the Rentable Area of the Building, shall be 0.40%. Tenant
shall pay to Landlord throughout the New Premises Lease Term Tenant's
Proportionate Share of the amount by which the Costs of Operation and
Maintenance of the Building exceed the Base Costs as established in Section 4 of
the Third Addendum.
5. Construction of Alterations to New Premises. Tenant shall
accept the New Premises in their "as is" physical condition as of the
commencement of the New Premises Lease Term. Concurrently with the execution and
delivery hereof Tenant shall pay to Landlord the sum of Five Thousand Two
Hundred Dollars ($5,200) as payment for the tenant improvement work required to
separate the New Premises from the remainder of the Reduced Premises, including
(a) installing a new demising wall in the approximate location indicated on the
space plan attached to this Addendum as Exhibit C, (b) separating the electrical
service, mechanical, HVAC and fire sprinklers for the New Premises from the
remainder of the Reduced Premises, (c) relocating lighting and fire sprinklers
within the New Premises and the remainder of the Reduced Premises which are
physically impacted by the installation of the new demising wall, and (d)
painting both sides of the new demising wall with one (1) coat of building
standard paint to match existing color of the New Premises and installing
building standard base on both sides of the new demising wall. All such work
shall be performed in accordance with the requirements of the Lease and shall be
performed by Landlord's contractor.
6. Acknowledgement. Tenant acknowledges that Landlord previously
issued a warning to Tenant, to the effect that Landlord has received numerous
complaints regarding smoking with the Premises. Tenant acknowledges and agrees
that smoking within the Premises (and elsewhere within the Building) is a
violation of applicable laws, and that such activity therefore constitutes a
material breach of the Lease by Tenant. From and after the date hereof Tenant
agrees to cause its employees, contractors, invitees, licensees and all other
occupants of the Premises to comply with applicable laws prohibiting smoking
within the Building and the Premises, and Tenant acknowledges and agrees that
Tenant's failure to do so shall constitute a material breach of the Lease and
this Addendum by Tenant, affording Landlord all rights and remedies permitted
under the Lease in the event of such breach by Tenant. Tenant further
acknowledges and agrees that Landlord's failure to previously declare Tenant in
breach of the Lease due to such smoking activity shall not be deemed a waiver of
Landlord's right to declare Tenant in breach of the Lease in the future should
any of Tenant's employees, contractors, invitees, licensees or other occupants
of the Premises fail, following the date hereof, to comply with applicable laws
prohibiting smoking within the Premises and the Building.
7. Alternative Space. At any time after Tenant's execution of this
Addendum, Landlord shall have the right, upon providing Tenant thirty (30) days
prior written notice, to provide and furnish tenant with space elsewhere in the
Building of approximately the same size as the New Premises, and to move and
place Tenant in such new space at Landlord's expense. In the event Landlord
moves Tenant to such new space, then the Lease and this Addendum, and each and
all of the terms and covenants and conditions thereof and hereof, shall
thereupon remain in full force and effect and be deemed applicable to such new
space except that a revised Exhibit C shall become part of the Lease and shall
reflect the location of the new space, and the Fundamental Lease Provisions of
this Lease shall be amended to include and state all correct data as to the new
space.
-2-
<PAGE> 3
8. Construction Matters. Tenant shall cooperate with Landlord's
construction schedule and Landlord will endeavor to give Tenant advance notice
as to when it will be required to vacate portions of the Tenant's space to
accommodate that construction.
9. Ratification. Except as specifically provided in this Addendum,
all of the terms and conditions of the Lease, including without limitation those
relating to the time and manner of payment of Rent, expenses and parking
charges, shall apply to Tenant's rental of the New Premises during the New
Premises Lease Term, and all references to the Premises and provisions relating
thereto contained in the Lease shall refer to the New Premises during the New
Premises Lease Term and are incorporated herein by reference. Except as
otherwise specifically provided herein, all of the terms, definitions, covenants
and conditions of the Lease are hereby ratified, confirmed and remain in full
force and effect, and are incorporated into this Addendum. This Addendum and the
Lease supersede in their entirety any and all prior written and oral agreements
and understandings of the parties pertaining to the New Premises Lease Term,
including without limitation that certain Letter of Intent dated December 10,
1996 written by Landlord to Tenant.
IN WITNESS WHEREOF the parties have executed this Addendum as of the
date and year first written above.
LANDLORD: WESTSIDE ASSOCIATES, LTD.,
A California limited partnership
By Its General Partner:
BBR Venture I,
a California limited partnership
By [SIG]
-----------------------------
Authorized Signator
By [SIG]
-----------------------------
Authorized Signator
Dated: February 11, 1997
TENANT: THE JOHN ADAMS LIFE CORPORATION,
a California corporation
By: [SIG]
-------------------------------
Its: CEO
-------------------------------
Dated: February 7, 1997
-3-
<PAGE> 4
[FLOORPLAN OF JOHN ADAMS LIFE INSURANCE]
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S CONSOLIDATED STATEMENTS OF EARNINGS AND CONSOLIDATED BALANCE SHEETS,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 131,721
<SECURITIES> 2,001,555
<RECEIVABLES> 21,127
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 74,328
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 3,180,067
<CURRENT-LIABILITIES> 212,473
<BONDS> 0
0
0
<COMMON> 6,254,547
<OTHER-SE> (3,018,973)
<TOTAL-LIABILITY-AND-EQUITY> 3,180,067
<SALES> 0
<TOTAL-REVENUES> 144,743
<CGS> 0
<TOTAL-COSTS> 186,039
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> (41,296)
<DISCONTINUED> (62,764)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (104,060)
<EPS-PRIMARY> (.04)
<EPS-DILUTED> 0
</TABLE>
