<PAGE> 1
U.S. 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 June 30, 1996
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from to .
Commission File Number: 33-15540-B
AMERICAS GAMING INTERNATIONAL, INC.
(Exact name of small business issuer as specified in its charter)
DELAWARE 06-1189563
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
690 South Rock Boulevard, Reno, Nevada 89502
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: 702-856-4005
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities 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 [ ]
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
<TABLE>
<CAPTION>
Class Number of Shares Outstanding
----- ----------------------------
<S> <C>
Common Stock, Par Value $.001 8,098,677
</TABLE>
Transitional Small Business Disclosure Format (Check One):
[ ] Yes [X] No
<PAGE> 2
INDEX
AMERICAS GAMING INTERNATIONAL, INC. AND SUBSIDIARIES
Page
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements:
Consolidated Balance Sheet - June 30, 1996
(Unaudited) and December 31, 1995..................... 3
Consolidated Income Statement - June 30, 1996
(Unaudited) and December 31, 1995..................... 4
Consolidated Statement of Cash Flows - Six
Months Ended June 30, 1996 and June 30, 1995
(Unaudited)........................................... 5
Notes to Financial Statements......................... 6
ITEM 2. Plan of Operations.................................... 9
PART II. OTHER INFORMATION
ITEM 5. Other Information..................................... 12
ITEM 6. Exhibits and Reports on Form 8-K...................... 12
SIGNATURES .............................................................. 13
2
<PAGE> 3
AMERICAS GAMING INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
<TABLE>
<CAPTION>
ASSETS
------------------------------
June 30, December 31,
1996 1995
---------- ------------
<S> <C> <C>
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS ................................ $ 1,817,505 $ 308,036
RESTRICTED CASH .......................................... 500,000
ACCOUNTS RECEIVABLE ...................................... 46,980
DUE FROM SUPPLIER ........................................ 540,000
INVENTORY ................................................ 124,407 108,435
PREPAID EXPENSES ......................................... 240,000 19,901
EQUIPMENT DEPOSITS ....................................... 394,262
DEBT ISSUE COSTS ......................................... 126,562
GAMING LICENSE AGREEMENT;
CURRENT PORTION ...................................... 36,036 36,036
----------- ----------
TOTAL CURRENT ASSETS ............................... 3,159,190 1,138,970
DEFERRED UNDERWRITING COSTS .............................. 95,216 60,152
DEFERRED FUTURE PROJECT COSTS ............................ 1,025,867
PROPERTY AND EQUIPMENT ................................... 3,040,960 722,791
GAMING LICENSE AGREEMENT ................................. 942,943 960,961
INVESTMENT IN SAGI ....................................... 90,000
DEFERRED ASSETS .......................................... 25,000
----------- ----------
TOTAL ASSETS ....................................... $ 8,379,176 $2,882,874
=========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
ACCOUNTS PAYABLE ......................................... $ 673,118 $ 104,800
ACCRUED INTEREST ......................................... 17,098
ACCRUED LIABILITIES:
NOTES PAYABLE AND ACCRUED
INTEREST; RELATED PARTY .............................. 807,225
NOTES PAYABLE-CURRENT PORTION .......................... 514,882
STOCK SUBSCRIPTION PAYABLE ............................. 168,750
----------- ----------
TOTAL CURRENT LIABILITIES .......................... 1,188,000 1,097,873
NOTES PAYABLE ............................................ 458,325 2,000,000
STOCKHOLDERS' EQUITY:
COMMON STOCK $.001 PAR VALUE:
25,000,000 SHARES AUTHORIZED;
7,948,677, AND 5,375,000
SHARES ISSUED AND OUTSTANDING
AT JUNE 30, 1996 AND
DECEMBER 31, 1995 ..................................... 7,899 5,375
PREFERRED STOCK: $.001 PAR VALUE
5,000,000 SHARES AUTHORIZED;
515,000 SHARES ISSUED AND
OUTSTANDING AT JUNE 30, 1996 ........................... 515
ADDITIONAL PAID IN CAPITAL ............................... 8,085,829 7,307
ACCUMULATED DEFICIT ...................................... (1,361,392) (227,681)
----------- ----------
6,732,851 (214,999)
TOTAL LIABILITIES AND
STOCKHOLDERS EQUITY .................................. $ 8,379,176 $2,882,874
=========== ==========
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
3
<PAGE> 4
AMERICAS GAMING INTERNATIONAL, INC.
CONSOLIDATED INCOME STATEMENT
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
-------------------------- ------------------------
1996 1995 1996 1995
---------- -------- ----------- -----
<S> <C> <C> <C> <C>
REVENUES:
GAMING REVENUE ......... $ 118,823 $ 0 $ 170,562 $ 0
---------- -------- ----------- -----
$ 118,823 0 170,562 0
OPERATING EXPENSES ....... 111,187 166,919 0
GENERAL AND ADMINISTRATIVE
EXPENSES ............... 452,639 0 992,998 0
OPERATING INCOME
(LOSS) ................ (445,003) 0 (989,355) 0
OTHER INCOME AND EXPENSES:
INTEREST AND
DIVIDEND INCOME .......... 1,271 0 1,271 0
INTEREST EXPENSE ......... (57,629) (145,321)
OTHER EXPENSES ........... (306) (306)
---------- -------- ----------- -----
(56,664) 0 (144,356) 0
NET LOSS ................. $ (501,667) $ 0 $(1,133,711) 0
WEIGHTED AVERAGE NUMBER
OF COMMON SHARES
OUTSTANDING .............. 7,424,969 6,705,166 0
NET INCOME (LOSS)
PER COMMON SHARE ......... $ (0.07) $ (0.00) $ (0.17) $0.00
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
4
<PAGE> 5
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30,
(UNAUDITED)
<TABLE>
<CAPTION>
1996 1995
----------- ----------
<S> <C> <C>
CASH FLOWS PROVIDED BY (USED IN
OPERATING ACTIVITIES
Net income (loss) .......................................................... $(1,133,711) $ (227,681)
----------- ----------
Adjustments to reconcile net income (loss)
to net cash provided by operating activities:
Amortization & Depreciation .............................................. 221,947 45,191
Non-cash expense incurred associated with
issuance of stock ....................................................... 134,375
(Increase) decrease in assets:
Increase in restricted funds ............................................. (500,000)
Accounts receivable ...................................................... (46,980)
Inventory ................................................................ (15,972) (108,435)
Due from supplier ........................................................ 540,000 (540,000)
Prepaid expenses ......................................................... (240,000) (19,901)
Equipment deposits ....................................................... (374,361)
Deferred underwriting costs preferred stock .............................. (35,064) (60,152)
Accounts receivable ...................................................... (46,980)
Deferred assets .......................................................... (25,000)
Increase (decrease) in liabilities:
Accounts payable ......................................................... 568,318 104,800
Accrued interest ......................................................... 140,879 24,323
----------- ----------
Total adjustments ..................................................... 321,162 (554,174)
----------- ----------
Net cash provided by (used in) operating activities............................ (812,549) (781,855)
Cash flows from investing activities:
Acquisition of equipment ................................................... (2,395,536) (722,791)
Investment in partnership .................................................. (90,000)
Investment in future projects .............................................. (1,025,867)
----------- ----------
Net cash used in investing activities .................................... (3,511,403) (722,791)
Cash flows from financing activities:
Net proceeds from sale of stock ............................................ 4,597,117
Net proceeds from issuing short term debt .................................. 1,685,500 2,000,000
Principal payments on debt ................................................. (1,549,176) (200,000)
Financing of equipment purchased ........................................... 1,099,980
Proceeds from sale of stock in connection with
reverse merger ........................................................... 12,682
----------- ----------
Net cash provided by (used in) financing
activities .................................................................. 5,833,421 1,812,682
----------- ----------
Net increase (decrease) in cash and cash equivalents .......................... 1,509,469 308,036
Cash and cash equivalents beginning of period ................................. 308,036 0
----------- ----------
Cash and cash equivalents end of period ....................................... $ 1,817,505 $ 308,036
=========== ==========
</TABLE>
5
<PAGE> 6
AMERICAS GAMING INTERNATIONAL, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1996
(UNAUDITED)
NOTE A: Basis to Presentation and Summary of Significant Accounting Policies
Fair Presentation - The balance sheet as of June 30, 1996, the
statement of operations for the six months ended June 30, 1996, and the
statement of cash flows for the six months ended June 30, 1996 and,
have been prepared by the Company without audit. In the opinion of
management, all adjustments (which include only normal recurring
accruals) necessary to present fairly the financial position and
results of operations at June 30, 1996 have been made.
The financial statements as of December 31, 1995 have been derived from
audited financial statements.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested
that these financial statements be read in conjunction with the
financial statements and notes thereto as of December 31, 1995 and the
year then ended.
Cash and Cash Equivalents - The Company considers all highly liquid
debt instruments purchased with a maturity of three months or less to
be cash equivalents.
Earnings (Loss) Per Common Share - Earnings (Loss) per common share is
based on the weighted average number of common shares outstanding
during the period. Common stock equivalents, consisting of shares
issuable upon exercise of outstanding Stock Purchase Warrants have not
been included in the computation of loss per share because their effect
would be antidilutive.
Inventory - Inventory consists of Gaming tokens to be used in Gaming
machines. Tokens have been valued at the lower of cost (first-in,
first-out) or market.
Property and Equipment - Property and equipment are stated at cost.
Ordinary maintenance and repairs are charged to expenses as incurred.
Costs that materially increase the life or value of existing assets are
capitalized. Assets that have been placed in service and produce
revenue are depreciated over their estimated useful lives or amortized
over lease terms using the straight line method.
In accordance with Financial Accounting Standards No. 121 ("SEAS 121),
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed of". The Company believes that expected future
cash flows to be generated by the Company's long lived assets are
sufficient to recover the net carrying amount of these assets.
6
<PAGE> 7
AMERICAS GAMING INTERNATIONAL, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1996
(UNAUDITED)
Deferred Underwriting Costs - The Company has identified and deferred
specific incremental costs directly attributable to a proposed offering
of common stock under the Securities Act of 1993. These costs are
expected to be charged against the gross proceeds of the offering.
Debt Issue Costs - Debt issue costs consist of the (discounted) fair
value of 400,000 shares of the Company's (restricted) common stock
which were issued to a consortium of lenders in connection with the
bridge financing which the Company entered into on November 30, 1995.
The costs are being amortized over a four month period ending on the
maturity date of the notes, March 31, 1996.
Gaming License Agreements - The cost of obtaining (a) the Casino-Hotel
License Agreement, and (b) the thirty year Costa Rican Gaming License
are being amortized on a straight line basis over 27-3/4 years
(Remainder of Gaming License Term).
Income Taxes - Income Taxes, if any, are determined under the Liability
Method as required by Statement of Financial Accounting Standards No.
109, "Accounting for Income Taxes."
Foreign Currency Transaction - The assets acquired by the Company in
Costa Rica are translated into U.S. Dollars at current exchange rates
and expenses are translated at average rates of exchange prevailing
during the period.
NOTE B: Notes Payable
On November 28, 1995 the Company borrowed $2,000,000 at 12.68% annual
interest (Bridge Financing) from various Lenders. The loan is evidenced
by Promissory Notes and secured by all of the Company's assets. The
notes matured on June 30, 1996. The Lenders agreed to convert the
debt to equity by accepting 1,300,000 shares of common stock in
payment for the obligation. Accordingly, the notes payable are
classified as noncurrent liabilities in the accompanying balance sheet.
During January, 1996 the Company borrowed an additional $1,075,000 at
12.68% annual interest (Bridge Financing) from various Lenders. As of
March 29, 1996, $2,275,000 of this debt, plus accrued interest was
converted to equity. The balance of this debt was converted to equity
by mid May 1996. Interest expense relating to the bridge financing
notes amounted to $17,098 in 1995.
7
<PAGE> 8
AMERICAS GAMING INTERNATIONAL, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1996
(UNAUDITED)
NOTE C: Private Offering
In the first quarter of 1996, the Company commenced an offering,
through private placement, of a minimum of 500,000 and a maximum of
1,000,000 shares of 10% cumulative convertible preferred stock. Annual
cumulative dividends of $1 per share are payable quarterly commencing
July 1, 1996 on the preferred shares. The offering price was $10 per
share. Each share of preferred stock is convertible at any time at the
option of the holder into 3 shares of common stock. The offering was
completed by mid June 1996, issuing 515,000 shares of preferred stock.
NOTE D: Totally Owned Subsidiary
On May 1, 1996 the company formed a wholly owned subsidiary, Americas
Gaming International-Costa Rica S.A. The purpose of this company is to
run slot operations in Costa Rica. Prior to May 1, 1996 the company had
run the Costa Rican slot operations as a division of Americas Gaming
International.
8
<PAGE> 9
ITEM 2. PLAN OF OPERATIONS
OPERATING PLAN
The Company was originally incorporated in 1986, and reincorporated in
Delaware in 1993. The Company changed its name to Americas Gaming International,
Inc. on November 22, 1995 in connection with a merger (the "Merger") with BWC
Holding, Inc. ("BWC"). As a result of the Merger, the Company obtained its
existing business operations. Prior to the Merger, the Company had been inactive
for several years, and had no revenues from operations during 1995 or 1994. In
response to comments from the Securities and Exchange Commission, the Company
has accounted for the Merger as a reverse acquisition of the Company's
predecessor, Oxford Capital Corporation ("Oxford"), by BWC. Consequently, the
Company has revised its historical financial statements to reflect that BWC,
rather than Oxford, was its predecessor. Because BWC was recently formed prior
to the Merger, the Company's 1995 operating results present no activity, rather
than the limited operating results of Oxford previously presented. In addition,
as a result of the restatement, the value of the Gaming License Agreements
carried on the Company's balance sheet has been written down from approximately
$2.3 million to $1 million, less adjustments for depreciation.
Following the Merger, the Company has been implementing its gaming
operations in Costa Rica, Peru and Namibia, and exploring relationships and
operating potential in other emerging gaming markets. The Company's recent and
present activities include raising capital, acquiring operating assets,
recruiting and training personnel and exploring and developing markets. The
Company's business is in an early stage of operation and has generated
insignificant revenues since the Merger. The Company's Costa Rican gaming
operations generated revenues of only $118,823 for the quarter ended June 30,
1996. The revenues were less than expected due to the government's shutdown of a
large casino that the Company was servicing and delays in government approvals
for other casinos. In addition, the Company believes that its slot machines in
Costa Rica have not received optimal play because the token denomination
accepted by the machines (50 Colones, which is approximately $.25) is perceived
as too expensive by many casino patrons. The Company is modifying its machines
to provide multiple plays on one token and/or bill validators that achieve the
same result. There can be no assurance that these changes will lead to improved
play and revenues in Costa Rica.
The Company has entered into an agreement to install up to 500 machines
at a casino in Lima, Peru. As of August 15, 1996, the Company had installed
approximately 200 gaming machines in such casino, and expects to install
approximately 100 more machines in Lima during the remainder of 1996, although
there can be no assurances in this regard. In addition, the Company's African
joint venture, Safika Americas Gaming International ("SAGI"), has installed 54
machines in non-casino locations in Namibia. SAGI expects to install more
machines in Namibia prior to 1997. SAGI also has been awarded the right to
install and operate a charitable Keno Lottery in Namibia, and is commencing
production on that project. The Company has incurred operating losses from its
recent activities, and believes it will be several more months before revenues
from operations are able to fund its operating costs.
9
<PAGE> 10
During the remainder of 1996, the Company intends to (1) expand its
operations in Costa Rica, Peru and Namibia by installing additional machines
and, if possible, obtaining agreements to perform route operations for
additional casinos, (2) implement route operations in Antigua, West Indies, (3)
build relationships and infrastructure in South Africa and Mexico in
anticipation of adoption of new gaming statutes in those jurisdictions, (4)
hire, train and implement a service force to conduct its route operations in
various locales, (5) develop a sales and marketing force to promote the
Company's business, (6) explore opportunities in additional emerging gaming
markets, and (7) raise funds through debt and equity offerings to finance its
activities. Implementation of the Company's business plan will require
substantial capital. Expansion of the Company's operations into other locales
may substantially increase the Company's capital requirements.
LIQUIDITY AND CAPITAL RESOURCES
Results of Operations for the Quarter Ended June 30, 1996. At June 30,
1996 the Company had cash and cash equivalents of approximately $1,817,505. The
Company's principal sources of funds have been approximately $3,575,000 of loan
proceeds from private placements of debt instruments in December 1995, January
1996 and April 1996 (See "-- Bridge Financing" below) and a private placement of
preferred stock that raised gross proceeds of $5,150,000 (see "Preferred Stock
Offering" below). For the quarter ended June 30, 1996, the Company generated
gaming revenues of $118,823. For the quarter, the Company incurred operating
expenses of $111,187 and general and administrative expenses of $452,639. As a
result, the Company incurred a net loss of $501,667 (or $.07 per share) for the
quarter. The loss was incurred in connection with the start-up of the Company's
gaming operations, including the funding of substantial equipment purchases and
the acquisition and development of other resources, including personnel, in
various locales. The Company expects to incur significant increases in salaries
as it hires additional employees. In addition, the Company expects to continue
to incur significant capital expenditures relating to the acquisition and
implementation of gaming equipment, leasing of additional operation facilities
and other start-up expenditures.
Bridge Financing. In December 1995, January 1996 and April 1996, in
order to obtain capital to acquire the gaming equipment required to fulfill its
routing obligations, the Company completed three rounds of
10
<PAGE> 11
bridge financing (the "Bridge Financing") generating aggregate gross proceeds of
$3,575,000. In the first and second quarters of 1996, all but one of the lenders
in the Bridge Financing agreed to convert their notes representing $3,075,000
into shares of the Company's Common Stock at conversion prices ranging from
$1.25 to $2.00 per share. As a result of these debt conversions, the Company
eliminated its repayment obligations for the Bridge Notes, but further diluted
the interest of existing stockholders, including management.
The Company has used substantially all of the Bridge Financing proceeds
to acquire revenue equipment and to fund operating and general and
administrative expenses.
Preferred Stock Offering. In June 1996, the Company completed a private
placement of shares of 10% Cumulative Convertible Preferred Stock the "Preferred
Stock". The Preferred Stock was offered to accredited investors only, and was
marketed in certain domestic states and in foreign jurisdictions. The Company
sold 515,000 shares of Preferred Stock, raising gross proceeds of $5,150,000.
Annual cumulative dividends of $1.00 per share are paid quarterly in arrears.
Proceeds from the offering sufficient to pay dividends on the Preferred Stock
for four quarters following the issuance of the shares were placed in an escrow
with a financial institution. The shares of Preferred Stock are not redeemable
for twelve (12) months from the Closing; thereafter they may be redeemed for
cash or Common Stock at the option of the Company for $10.00 per share plus
accrued and unpaid dividends as of the redemption date. Holders of shares of
Preferred Stock are entitled to piggyback registration rights for the underlying
shares of Common Stock into which the Preferred Stock is convertible. The
Preferred Stock has a liquidation preference over the Common Stock equal to
$10.00 plus accrued and unpaid dividends.
Capital Commitments. The Company has committed to purchase slot
machines from a manufacturer for an aggregate purchase price of approximately
$2.7 million. The Company previously made down payments of approximately
$320,000 and $471,000 for such machines, and is paying the balance of
approximately $1.85 million in 24 equal monthly installments. In addition to the
foregoing, it is likely that the Company will need to purchase more machines
during this fiscal year in order to implement its intended business plan.
The Company recently acquired four proprietary games. The Company hopes
that the acquisition of these games will reduce its dependence on third party
manufacturers for similar types of equipment, allow it to offer a greater
variety of machines to its clientele, and permit it to produce some of its own
equipment at greatly reduced costs. The games consist of a multi-action touch
screen game, a one-, three- and five-seat electronic blackjack game, a
multi-participant poker game similar to Caribbean Stud, and a ten-player
roulette keno game. The roulette keno game was purchased for $200,000, plus an
additional $100,000 to be paid upon Class 3 gaming approval of the roulette keno
game. The blackjack and poker games were purchased for 150,000 shares of Common
Stock and a future royalty of five percent (5%) of the retail sales price of
each game sold. The Company also advanced the seller $25,000 against future
sales commissions. The games are in varying stages of completion, and the
Company may incur significant expenses to complete their development and obtain
requisite or desired gaming approval classifications.
The Company believes it will need to raise additional funds in order to
satisfy its intended expansion plans in Africa and Latin America. The Company is
hopeful that, in 1997, revenues from operations will fund its future equipment
purchases, although there can be no assurances in this regard. If future
revenues from operations are not adequate to fund intended expansion, the
Company may be required to raise additional funds from the sale of equity or
debt securities, or otherwise modify its business plan.
11
<PAGE> 12
PART II
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. EXHIBITS
Exhibit No. Description Method of Filing
----------- ----------- ----------------
27 Financial Data Schedule Filed herewith
b. REPORTS ON FORM 8-K
None
12
<PAGE> 13
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the undersigned has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: August 19, 1996
AMERICAS GAMING INTERNATIONAL, INC.
By: /s/ John Sutherland
-----------------------------------
John Sutherland
President (Chief Executive Officer)
By: /s/ Vincent Brian Balik
-----------------------------------
Vincent Brian Balik
Vice President-Finance
(Chief Financial & Accounting
Officer)
13
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET DATED JUNE 30, 1996 AND INCOME STATEMENT FOR THE PERIOD ENDED JUNE 30,
1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> APR-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 1,817,505
<SECURITIES> 0
<RECEIVABLES> 46,980
<ALLOWANCES> 0
<INVENTORY> 124,407
<CURRENT-ASSETS> 3,159,190
<PP&E> 3,040,960
<DEPRECIATION> 221,947
<TOTAL-ASSETS> 8,379,176
<CURRENT-LIABILITIES> 1,188,000
<BONDS> 0
0
515
<COMMON> 7,899
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 8,379,176
<SALES> 118,823
<TOTAL-REVENUES> 118,823
<CGS> 111,187
<TOTAL-COSTS> 563,826
<OTHER-EXPENSES> (57,935)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 37,629
<INCOME-PRETAX> (445,003)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (501,667)
<EPS-PRIMARY> (0.07)
<EPS-DILUTED> 0
</TABLE>
