<PAGE>
FORM 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended JULY 31, 1995
----------------------
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 33-1406
---------------------
BUCK HILL FALLS COMPANY
--------------------------------------------------------
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 24-0536840
-------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
CRESCO ROAD, BUCK HILL FALLS, PENNSYLVANIA 18323
--------------------------------------------------
(Address of principal executive offices)(Zip Code)
(717) 595-7511
----------------------------------------------------
(Registrant's telephone number, including area code)
----------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
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 (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 No X
--------- ----------
As of July 31, 1995, the registrant had 73,537 shares of Common
Stock, no par value, outstanding.<PAGE>
<PAGE>
FORM 10-Q
BUCK HILL FALLS COMPANY
=======================
INDEX
Page
----
Part I: Financial Information
------- ---------------------
Item 1. Financial Statements
Condensed Consolidated Balance Sheet -
July 31, 1995 and October 31, 1994 1
Condensed Consolidated Statement of Operations -
Nine Months and Three Months Ended July 31, 1995
and 1994 2
Condensed Consolidated Statement of Cash Flows -
Nine Months Ended July 31, 1995 and 1994 3
Note to Condensed Consolidated
Financial Statements 4
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 5-9
Part II: Other Information 10-12
-------- -----------------
Signatures 13
<PAGE>
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
BUCK HILL FALLS COMPANY AND SUBSIDIARY
======================================
<TABLE>
CONDENSED CONSOLIDATED BALANCE SHEET
JULY 31,
1995 OCTOBER 31,
(UNAUDITED) 1994*
--------------------------------------------------------------------------
ASSETS
======
<S> <C> <C>
CURRENT ASSETS:
Cash $ 31,824 $ 20,194
Accounts receivable, net 330,199 175,758
Prepaid expenses and other current
assets 47,264 22,998
---------- ----------
Total current assets 409,287 218,950
RESTRICTED CASH 76,732 105,876
PROPERTY, PLANT AND EQUIPMENT, Net 2,768,082 2,761,827
DEFERRED COSTS, Net 13,808 17,363
---------- ----------
TOTAL $3,267,909 $3,104,016
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
====================================
CURRENT LIABILITIES:
Note payable, unsecured $ 11,300 $ 11,300
Current portion of long-term debt 768,579 847,586
Accounts payable, trade 90,665 114,370
Accrued expenses and other 323,540 219,687
---------- ----------
Total current liabilities 1,194,084 1,192,943
CUSTOMER DEPOSITS 76,732 105,882
LONG-TERM DEBT 963,627 675,922
6-1/4% SUBORDINATED NOTES 140,000 140,000
---------- ----------
Total liabilities 2,374,443 2,114,747
---------- ----------
1<PAGE>
<PAGE>
STOCKHOLDERS' EQUITY:
Common stock 1,251,370 1,251,370
Contributed capital 799,227 799,227
Deficit (1,157,131) (1,061,328)
----------- -----------
Total stockholders' equity 893,466 989,269
----------- ----------
TOTAL $3,267,909 $3,104,016
========== ==========
*Condensed from audited financial statements
</TABLE>
The accompanying notes are an integral part of these
condensed consolidated financial statements.
2<PAGE>
<PAGE>
BUCK HILL FALLS COMPANY AND SUBSIDIARY
======================================
<TABLE>
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
NINE MONTHS ENDED THREE MONTHS ENDED
.......JULY 31........ ......JULY 31......
1995 1994 1995 1994
-----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
REVENUES $1,381,327 $1,364,869 $747,612 $786,589
COST OF REVENUES 1,135,983 1,082,595 528,474 483,550
---------- ---------- -------- --------
GROSS PROFIT FROM OPERATIONS 245,344 282,274 219,138 303,039
GENERAL AND ADMINISTRATIVE EXPENSES 341,434 319,836 80,285 98,622
---------- ---------- -------- --------
INCOME (LOSS) FROM OPERATIONS (96,090) (37,562) 138,853 204,417
---------- ---------- -------- --------
OTHER INCOME (EXPENSE):
Miscellaneous 113,805 41,213 54,635 18,292
Interest expense (134,973) (87,094) (62,035) (34,087)
Capitalized interest 21,455 31,125 - 13,782
---------- ---------- -------- --------
Other income (expense), net 287 (14,756) (7,400) (2,013)
---------- ---------- -------- --------
INCOME (LOSS) BEFORE PROVISION FOR
INCOME TAXES AND CUMULATIVE EFFECT
OF CHANGE IN ACCOUNTING PRINCIPLE (95,803) (52,318) 131,453 202,404
PROVISION FOR INCOME TAXES - 21,600 - -
---------- ---------- -------- --------
INCOME (LOSS) BEFORE CUMULATIVE EFFECT
OF A CHANGE IN ACCOUNTING PRINCIPLE (95,803) (73,918) 131,453 202,404
CUMULATIVE EFFECT OF ACCOUNTING CHANGE - 21,600 - -
----------- ----------- -------- --------
NET INCOME (LOSS) $ (95,803) $ (52,318) $131,453 $202,404
=========== =========== ======== ========
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING 73,537 73,537 73,537 73,537
NET INCOME (LOSS) PER COMMON SHARE:
Before cumulative effect of
accounting change $ (1.30) $ (1.00) $ 1.79 $ 2.75
Cumulative effect of accounting
change - .29 - -
----------- ----------- -------- --------
NET INCOME (LOSS) PER COMMON SHARE $ (1.30) $ (.71) $ 1.79 $ 2.75
=========== =========== ======== ========
</TABLE>
The accompanying notes are an integral part of these
condensed consolidated financial statements.
3<PAGE>
<PAGE>
BUCK HILL FALLS COMPANY AND SUBSIDIARY
======================================
<TABLE>
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
NINE MONTHS ENDED
.......JULY 31.....
1995 1994
----------------------------------------------------------------------------
<S> <C> <C>
CASH PROVIDED BY (USED IN):
OPERATING ACTIVITIES:
Net loss $ (95,803) $(52,318)
Adjustments for noncash charges:
Depreciation and amortization 142,788 119,305
Gain on sale of property and equipment (52,389) -
Changes in assets and liabilities (98,565) 25,474
--------- --------
Net cash (used in) provided by operating
activities (103,969) 92,461
--------- --------
INVESTING ACTIVITIES:
Purchase of property and equipment (145,988) (557,302)
Proceeds from sale of property and equipment 42,513 -
--------- --------
Net cash used in investing activities (103,475) (557,302)
--------- --------
FINANCING ACTIVITIES:
Proceeds from issuance of debt 938,612 464,292
Repayment of debt (719,538) (12,835)
--------- --------
Net cash provided by financing
activities 219,074 451,457
--------- --------
INCREASE (DECREASE) IN CASH 11,630 (13,384)
CASH, BEGINNING OF PERIOD 20,194 13,384
--------- --------
CASH, END OF PERIOD $ 31,824 $ -
======== ========
CASH PAID (REFUNDED) FOR:
Interest $ 95,766 $ 51,160
Income taxes $ - $ (500)
</TABLE>
The accompanying notes are an integral part of these
condensed consolidated financial statements.
4<PAGE>
<PAGE>
BUCK HILL FALLS COMPANY AND SUBSIDIARY
======================================
NOTE TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
------------------------------------------------------------------------
NOTE 1: BASIS OF PRESENTATION
Although the interim condensed consolidated financial statements
of Buck Hill Falls Company and Subsidiary (the "Company") are unaudited,
it is the opinion of the Company's management that all normal recurring
adjustments necessary for a fair statement of the results for the interim
periods presented have been reflected therein. The results of operations
for any interim period are not necessarily indicative of results that may
be expected for the entire year.
These statements should be read in conjunction with the
consolidated financial statements and related notes included in the
Company's annual report on Form 10-K for the year ended October 31, 1994.
-------------------------------------------------------------------------
5<PAGE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
GENERAL
The Company's business, insofar as it relates to the provision
of recreational facilities, is largely seasonal in nature. As a result,
the Company's revenues and cost of revenues typically increase
significantly in its third and fourth fiscal quarters.
RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED
JULY 31, 1995
COMPARED TO THE NINE MONTHS ENDED
JULY 31,1994
-----------------------------------------------
Revenues increased 1.2% for the nine months ended July 31, 1995,
as compared to the same period in the prior year, primarily due to
increases in golf revenues, annual dues and sport camp fees. Golf
revenues increased approximately $60,000 due to an increase in the number
of memberships and more favorable weather conditions experienced in the
first nine months of fiscal 1995. In addition, due to better weather
conditions in fiscal 1995, more rounds were played and, as a consequence,
revenues from greens fees and cart rental increased. The Company
increased annual dues billed to 290 residents at Buck Hill Falls from
$2,200 in 1994 to $2,400 in 1995. The $200 increase resulted in
additional revenues of approximately $44,000 for the first nine months of
fiscal 1995. Sport camp fees increased approximately $5,000 due to more
participants in fiscal 1995. The increase in revenues was partially
offset by a decrease in snow plowing revenues of approximately $16,000 due
to more favorable weather in fiscal 1995, decreased revenues from tennis
operations of approximately $3,000 attributable to decreased number of
memberships and decreased special assessment revenues of approximately
$74,000 compared to the same period in the prior year.
Cost of revenues increased 4.9% for the nine months ended July
31, 1995 as compared with the same period in the prior year. Maintenance,
supplies and salary expenses associated with golf operations increased
approximately $18,000, primarily due to an increase in the number of
rounds played in 1995, as discussed above. In addition, golf cart rental
expense increased approximately $6,000 due to additional golf carts
leased in 1995. The cost of contracted security services and repair and
maintenance expenses related to the security vehicle increased
approximately $5,000. Depreciation expense increased approximately
$24,000, resulting from the completion of water system capital
improvements in March 1995 and additional capital improvements to the
community placed in service in late 1994.
General and administrative expenses increased by 6.8% for the
nine months ended July 31, 1995 as compared to the same period in the
prior year. Legal and accounting fees increased approximately $64,000,
primarily due to Securities and Exchange Commission filings in 1995, legal
services on the potential water rate increase in 1996, consulting services
rendered on the examination of the Company's rights in the setting of dues
and assessments on the cottages at Buck Hill Falls as well as evaluation
of an offer from the Lot & Cottage Owner's Association for purchase of the
6<PAGE>
<PAGE>
Company's properties. The increase in general and administrative expenses
was partially offset by a $39,000 decrease in salary expense and related
payroll tax, fringe benefits and travel and entertainment due to the
resignation of the Company's President in January 1994 and a decrease in a
variety of minor expenditures relating to general and administrative
services.
Miscellaneous income increased 176.1%, principally due to a gain
of approximately $52,000 from the sale of property and equipment, an
insurance refund of approximately $17,000 and increased interest income of
approximately $5,000 for fiscal 1995. The increase in interest income
reflects a more aggressive policy in assessing finance charges on overdue
receivables.
Interest expense increased 102.8% as a result of increased
interest rates and borrowings in fiscal 1995 as well as interest expense
on the water system capital improvements loan.
The provision for 1994 income taxes reflects deferred federal
taxes resulting from utilization of net operating loss carryforwards.
Beginning in fiscal 1994, the Company adopted Statement of
Financial Accounting Standards No. 109 ("SFAS 109"), Accounting for Income
Taxes. The adoption of SFAS 109 resulted in a tax benefit in fiscal 1994
of approximately $21,600.
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED
JULY 31, 1995
COMPARED TO THE THREE MONTHS ENDED
JULY 31,1994
-------------------------------------------------
Revenues decreased approximately 5% for the three months ended
July 31, 1995, principally due to decreased special assessment revenues.
In 1994, the Company levied a special assessment of $400 to residents at
Buck Hill Falls in order to fund expenditures for major repairs and
replacements in the community. Approximately $84,000 was realized as
revenues for the three months ended July 31, 1994. There were no special
assessment revenues for the same period in 1995. The decrease in special
assessment revenues was partially offset by an increase in golf revenues
of approximately $23,000 due to increased memberships, increased annual
dues of approximately $14,500 and an increase in a variety of minor
revenues.
Cost of revenues increased approximately $45,000 principally as
a result of the same factors indicated in the discussion of the results of
operations for the nine months ended July 31, 1995 compared to the nine
months ended July 31, 1994.
General and administrative expenses decreased 18.6% for the
three months ended July 31, 1995, principally due to decreased legal
expenses of approximately $16,000.
The increase in miscellaneous income is attributable to a gain
of approximately $19,000 from the sale of property and equipment and an
insurance refund of $17,000.
7<PAGE>
<PAGE>
Interest expense increased principally as a result of the same
factors indicated in the discussion of the results of operations for the
nine months ended July 31, 1995 compared to the nine months ended July 31,
1994. There was no capitalized interest for the three months ended July
31, 1995 due to completion of water system capital improvements in March
1995.
Liquidity and Capital Resources
-------------------------------
At July 31, 1995, the Company had a working capital deficiency
of $784,797. Included in current liabilities is the entire $736,120
outstanding on the Company's $1,000,000 line of credit with a bank
(described in the following paragraph), which is payable on demand. An
additional $32,459 in scheduled principal payments on long-term debt are
due within the next twelve months.
On July 24, 1992, the Company entered into a loan agreement with
a bank relating to a secured revolving line of credit in the amount of
$1,000,000 (the "Revolving Credit Facility"). Amounts borrowed under the
Revolving Credit Facility bear interest at the prime rate (8.75% at July
31, 1995) plus 1.5%. Pursuant to the loan agreement, approximately 2,600
acres of land and land improvements located in Barrett Township, Monroe
County, Pennsylvania, are pledged as collateral, along with dues,
assessments and fee revenues. The Revolving Credit Facility is available
through May 31, 1997, contingent upon the Company maintaining a
satisfactory financial position and subject to annual review of the
Company's financial statements by the bank. The loan agreement with the
bank provides that if, in the opinion of the authorized lending officers
of the bank, the Company's credit worthiness materially declines, the
credit line will cease to be available for future draws, and any existing
balance will be required to be fully amortized over a reasonable term.
The Company was required to make certain improvements to its
water system. During 1993, the Company entered into a $650,000 loan
agreement with a bank to finance the improvements. On May 4, 1995, the
Company entered into a $900,000 secured term loan. The proceeds were used
to refinance the $650,000 loan agreement and pay for additional
improvements to the Company's water system. Principal and interest are
payable in monthly installments of $8,985, plus 1/12 of annual real estate
taxes, over a twenty-year amortization period. Interest is payable at the
bank's base rate (8.75% at July 31, 1995) plus 1.5%. The loan matures in
February 2015 and is secured by a first mortgage on approximately 2,200
acres of land and land improvements located in Barrett Township, Monroe
County, Pennsylvania.
The Company expects to meet its current liabilities (other than
payment of the entire $736,120 under the Revolving Credit Facility, which,
although not currently due, is classified as a current liability because
of the Revolving Credit Facility's demand terms) through increased
collections as a result of the seasonal increase in revenues which
typically occurs during the Company's third and fourth quarters through
the provision of recreational services. The Company does not anticipate
that the bank will demand payment under the Revolving Credit Facility.
Cash increased $31,824 for the nine months ended July 31, 1995.
Cash provided by borrowings of $938,612, comprised of $900,000 under the
8<PAGE>
<PAGE>
Company's secured term loan and $38,612 of vehicle loans, as well as
proceeds of $42,513 from the sale of property and equipment was used to
make principal payments of $719,538 on long-term debt, pay operating
expenditures of $103,969 and capital expenditures of $145,988. Such
capital expenditures included $31,406 incurred for construction period
interest costs, engineering fees and filtration plant installation costs
to complete water system improvements and $114,582 incurred primarily for
improvements to roads, sewer facilities and amenities in the community and
the purchase of vehicles.
At July 31, 1995, the Company had drawn $736,120 on its
$1,000,000 line of credit, leaving $263,880 available.
9
<PAGE>
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
1. On May 25, 1995, James J. Wilson and Barbara A. Wilson, his
wife, and Kempt Corporation filed a complaint against the
Company requesting that a decree be issued granting an
injunction enjoining the Company from imposing and collecting
$2,400 [per resident??] for the Company's 1995 dues assessment
and requiring the Company [to assess a 1995 assessment subject
to the 1909 covenants which they claim should be solely to pay
Plaintiffs' proportional share of road maintenance.]
On May 25, 1995, a Motion for Preliminary Injunction without
Hearing was also filed. On May 26, 1995, a Decree was granted
enjoining the Company from employing any steps to collect from
Plaintiffs or publicize Plaintiffs' failure to pay Company dues
assessments.
On June 19, 1995, the Company filed Preliminary Objections to
Plaintiffs' Complaint, Answer to Motion for Preliminary
Injunction and Brief in Opposition to Motion for Preliminary
Injunction.
On June 23, 1995, a hearing before the Court was held. At the
hearing, the parties stipulated to certain conditions and terms
pending final resolution of this matter. The Preliminary
Injunction Order previously issued by the Court was dissolved.
[This matter now shall continue in accordance with the normal
Rules of Civil Procedure.]
2. In July 1995 a lawsuit was commenced against the Company in the
Court of Common Pleas of Monroe County, Pennsylvania by the Lot
& Cottage Owners' Association of Buck Hill Falls Company and
certain residents of the town of Buck Hill Falls, Pennsylvania.
Also named as Defendants were George J. Byron, Genevieve R. Gee,
James T. Sygenda and Patricia J. Rauch, all of whom are
Directors of the Company. The Plaintiffs ask for a Declaratory
Judgment determining the rights of the individual Plaintiffs and
others under certain covenants imposed by the Company, rights to
the use of Company owned common areas, and the right of the
Company to assess owners for the purpose of retiring certain
debt. The suit also challenges the right of the Company to make
assessments and dues charges and seeks an injunction against
collection actions filed by the Company and against the sale or
subdivision of any lands which make up the Buck Hill Falls
community, excepting subdivided residential building lots in the
normal course of business. The Plaintiffs also ask the Court to
declare that the Company has waived all rights to make
assessment and dues charges and that the members of the Lot &
Cottage Owners' Association have common ownership rights,
interests, or easement rights in all of the property of the
Company. No monetary damages are sought. The litigation is in
its preliminary stages. The Company makes no prediction as to
10<PAGE>
<PAGE>
the probable outcome. A judgment in favor of the Plaintiffs
would have a material adverse effect on the Company.
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
1. The Annual Meeting of the shareholders of the Company was held
on July 16, 1995 at the Tennis Club of the Company. At the
meeting the following persons were elected as directors of the
Company, each receiving the number of votes set forth opposite
his name (after giving effect to cumulative voting):
George J. Byron - 57,430.5
Frank J. Dracos, M.D. - 42,059.0
David B. Ottaway - 38,754.5
A further nominee, Bruce C. Berry, received 27,776 votes. The
following additional persons continued as directors of the
Company after the meeting:
Genevieve R. Gee
Grace Godshalk
James T. Sygenda
James Wilson
Patricia J. Rauch
Clifford Press
2. At the July 16, 1995 Annual Meeting, the shareholders also voted
upon a proposal to amend the By-laws of the Company by adopting
a new Article 32 providing that the Company shall not sell,
convey or subdivide real estate or utilities outside of the
ordinary course of business without the prior consent of holders
of a majority of the shares of the Company's outstanding stock.
Approval of the proposed amendment would have required the
affirmative vote of holders of a majority of the outstanding
shares, or 36,769 shares. Having received only 31,868
affirmative votes, the proposal failed. There were 27,507
shares voted against the proposal, 257 abstentions and 1,437
shares withholding authority.
At a meeting held on July 14, 1995, the Board of Directors
adopted a similar new Article 32 of the By-laws providing that
the foregoing corporate actions would require the prior consent
of the holders of a majority of the stock having voting power,
present in person or by proxy, at a valid meeting of the
shareholders. The Company believes that this amendment does not
require shareholder approval.
11<PAGE>
<PAGE>
Item 5. Other Information
At its organizational meeting on July 23, 1995, the Board of
Directors elected David B. Ottaway as Chairman of the Board and Chief
Executive Officer of the Company, and George J. Byron as President
and Chief Operating Officer.
Item 6. Exhibits and Reports on Form 8-K
None
12
<PAGE>
<PAGE>
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.
BUCK HILL FALLS COMPANY
-------------------------------------
(Registrant)
Date: By: /s/ David B. Ottaway
--------------- ----------------------------------------
David B. Ottaway, Chairman
Date: By: /s/ George J. Byron
--------------- -----------------------------------------
George J. Byron
President (principal financial officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED FINANCIAL STATEMENTS FOUND IN THE ACCOMPANYING QUARTERLY REPORT ON
FORM 10-Q OF BUCK HILL FALLS COMPANY FOR THE QUARTER ENDED JULY 31, 1995,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
THIS EXHIBIT SHALL NOT BE DEEMED FILED FOR PURPOSES OF SECTION 11 OF THE
SECURITIES ACT OF 1933 AND SECTION 18 OF THE SECURITIES EXCHANGE ACT OF
1934, OR OTHERWISE SUBJECT TO THE LIABILITIES OF SUCH SECTIONS, NOR SHALL
IT BE DEEMED PART OF ANY OTHER FILING THAT INCORPORATES THIS REPORT BY
REFERENCE, UNLESS SUCH OTHER FILING EXPRESSLY INCORPORATES THIS EXHIBIT BY
REFERENCE.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> OCT-31-1995
<PERIOD-END> JUL-31-1995
<CASH> 31,824
<SECURITIES> 0
<RECEIVABLES> 330,199
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 409,287
<PP&E> 4,707,260
<DEPRECIATION> 1,939,178
<TOTAL-ASSETS> 3,267,909
<CURRENT-LIABILITIES> 1,194,084
<BONDS> 1,103,627
<COMMON> 1,251,370
0
0
<OTHER-SE> (357,904)
<TOTAL-LIABILITY-AND-EQUITY> 3,267,909
<SALES> 1,381,327
<TOTAL-REVENUES> 1,381,327
<CGS> 1,135,983
<TOTAL-COSTS> 1,135,983
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 113,518
<INCOME-PRETAX> (95,803)
<INCOME-TAX> 0
<INCOME-CONTINUING> (95,803)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (95,803)
<EPS-PRIMARY> (1.30)
<EPS-DILUTED> (1.30)
</TABLE>
