FORM 10-Q
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 June 30, 1999
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: 0-20058
WNC CALIFORNIA HOUSING TAX CREDITS, L.P.
California 33-0316953
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3158 Redhill Avenue, Suite 120, Costa Mesa, CA 92626
(714) 662-5565
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 .
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS, L.P.
(A California Limited Partnership)
INDEX TO FORM 10 - Q
For the Quarter Ended June 30, 1999
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets
June 30, 1999 and March 31, 1999 2
Statements of Operations
For the Three months Ended June 30, 1999 and 1998 3
Statement of Partners' Equity
For the Three months Ended June 30, 1999 4
Statements of Cash Flows
For the Three months Ended June 30, 1999 and 1998 5
Notes to Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
Item 3. Quantitative and Qualitative Disclosures About Market Risks 12
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 12
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 13
1
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS, L.P.
(A California Limited Partnership)
BALANCE SHEETS
June 30, 1999 March 31.1999
------------- -------------
(unaudited)
ASSETS
Cash and cash equivalents $ 63,713 $ 61,123
Investment in limited
partnerships - Note 2
1,419,067 1,508,351
--------- ---------
$ 1,482,780 $ 1,569,474
========= =========
LIABILITIES AND PARTNERS' EQUITY
Liabilities:
Accrued fees and expenses due to
general partner and affiliates
- Note 3 $ 882,573 $ 848,503
Partners' equity (deficit):
General partner (58,839) (57,631)
Limited partners (10,000 units
authorized, 7,450 units issued
and outstanding)
659,046 778,602
------- -------
Total partners' equity
600,207 720,971
------- -------
$ 1,482,780 $ 1,569,474
========= =========
See accompanying notes to financial statements
2
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS, L.P.
(A California Limited Partnership)
STATEMENTS OF OPERATIONS
For the Three Months Ended June 30, 1999 and 1998
(unaudited)
1999 1998
---- ----
Interest income $ 469 $ 567
Miscellaneous income - 1,000
--------- ---------
469 1,567
--------- ---------
Operating expenses:
Amortization 3,726 3,726
Asset management fees - Note 4 27,964 27,923
Legal and accounting 5,078 3,500
Other 1,828 9,895
--------- ---------
Total operating expenses 38,596 45,044
Loss from operations (38,127) (43,477)
--------- ---------
Equity in loss of
limited partnerships (82,637) (102,375)
--------- ---------
Net loss $ (120,764) $ (145,852)
========= =========
Net loss allocated to:
General partner $ (1,208) $ (1,459)
========= =========
Limited partners $ (119,556) $ (144,396)
========= =========
Net loss per limited
partner units (7,450 units
issued and outstanding) $ (16) $ (19)
========= =========
See accompanying notes to financial statements
3
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS, L.P.
(A California Limited Partnership)
STATEMENT OF PARTNERS' EQUITY
For the Three Months Ended June 30, 1999
(unaudited)
<TABLE>
<CAPTION>
General Limited
Partner Partners Total
------- -------- -----
<S> <C> <C> <C>
Equity (deficit), March 31, 1999 $ (57,631) $ 778,602 $ 720,971
Net loss for the three months ended
June 30, 1999 (1,208) (119,556) (120,764)
-------- -------- --------
Equity (deficit), June 30, 1999 $ (58,839) $ 659,046 $ 600,207
======== ======== ========
</TABLE>
See accompanying notes to financial statements
4
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS, L.P.
(A California Limited Partnership)
STATEMENTS OF CASH FLOWS
For the Three Months Ended June 30, 1999 and 1998
(unaudited)
<TABLE>
<CAPTION>
1999 1998
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (120,764) $ (145,852)
Adjustments to reconcile net loss to net
cash provided by (used) in operating activities:
Equity in loss of limited partnerships 82,637 102,375
Amortization 3,726 3,726
Change in other assets - -
Accrued fees and expense due to
general partner and affiliates 34,070 28,813
--------- ---------
Net cash used in other operating activities (331) (10,938)
--------- ---------
Cash flows from investing activities:
Distributions from limited partnerships 2,921 -
--------- ---------
Net increase (decrease) in cash and cash equivalents 2,590 (10,938)
Cash and cash equivalents, beginning of period 61,123 79,190
--------- ---------
Cash and cash equivalent, end of period $ 63,713 $ 68,252
========= =========
</TABLE>
See accompanying notes to financial statements
5
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS - CONTINUED
June 30, 1999
(unaudited)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
General
The information contained in the following notes to the financial statements is
condensed from that which would appear in the annual financial statements;
accordingly, the financial statements included herein should be reviewed in
conjunction with the financial statements and related notes thereto contained in
the WNC California Housing Tax Credits, L.P. (the "Partnership") Annual Report
on Form 10-K for the year ended March 31, 1999. Accounting measurements at
interim dates inherently involve greater reliance on estimates than at year end.
The results of operations for the interim period presented are not necessarily
indicative of the results for the entire year.
In the opinion of the Partnership, the unaudited financial statements contain
all adjustments (consisting of only normal recurring accruals) necessary
to present fairly the financial position as of June 30, 1999 and the results of
operations and changes in cash flows for the three months then ended.
Organization
WNC California Housing Tax Credits, L.P., a California Limited Partnership (the
"Partnership"), was formed on September 15, 1988 under the laws of the State of
California. The Partnership was formed to invest primarily in other limited
partnerships (the "Local Limited Partnerships") which own and operate
multi-family housing complexes (the "Housing Complex") that are eligible for low
income housing tax credits. The local general partners (the "Local General
Partners") of each Local Limited Partnership retain responsibility for
maintaining, operating and managing the Housing Complex.
WNC & Associates, Inc., a California corporation and Wilfred N. Cooper, Sr. are
the general partners (collectively the "General Partner") of the Partnership.
Wilfred N. Cooper, Sr., through the Cooper Revocable Trust, owns 66.8% of the
outstanding stock of Associates. John B. Lester, Jr. was the original limited
partner of the Partnership and owns, through the Lester Family Trust, 28.6% of
the outstanding stock of Associates. The business of the Partnership is
conducted primarily through Associates, as the Partnership has no employees of
its own.
The Partnership Agreement authorized the sale of up to 10,000 units at $1,000
per Unit ("Units"). The offering of Units concluded in October 1990 at which
time 7,450 Units representing subscriptions in the amount of $7,450,000, had
been accepted. The General Partners have a 1% interest in operating profits and
losses, taxable income and losses, in cash available for distribution from the
Partnership and tax credits of the Partnership. The limited partners will be
allocated the remaining 99% of these items in proportion to their respective
investments.
After the limited partners have received proceeds from a sale or refinancing
equal to their capital contributions and their return on investment (as defined
in the Partnership Agreement) and the General Partners have received proceeds
equal to their capital contributions from the remainder, any additional sale or
refinancing proceeds will be distributed 99% to the limited partners (in
proportion to their respective investments) and 1% to the General Partners.
Risks and Uncertainties
The Partnership's investments in Local Limited Partnerships are subject to the
risks incident to the management and ownership of low-income housing and to the
management and ownership of multi-unit residential real estate. Some of these
risks are that the low income housing credit could be recaptured and that
neither the Partnership's investments nor the Housing Complexes owned by the
Local Limited Partnerships will be readily marketable. To the extent the Housing
Complexes receive government financing or operating subsidies, they may be
subject to one or more of the following risks: difficulties in obtaining tenants
for the Housing Complexes; difficulties in obtaining rent increases; limitations
on cash distributions; limitations on sales or refinancing of Housing Complexes;
limitations on transfers of Local Limited Partnership Interests; limitations on
removal of Local General Partners; limitations on subsidy programs; and possible
6
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS - CONTINUED
June 30, 1999
(unaudited)
NOTE 1 - ORGANIZATION AND OTHER MATTERS, continued
changes in applicable regulations. The Housing Complexes are or will be subject
to mortgage indebtedness. If a Local Limited Partnership does not makes its
mortgage payments, the lender could foreclose resulting in a loss of the Housing
Complex and low income housing credits. As a limited partner of the Local
Limited Partnerships, the Partnership will have very limited rights with respect
to management of the Local Limited Partnerships, and will rely totally on the
Local General Partners of the Local Limited Partnerships for management of the
Local Limited Partnerships. The value of the Partnership's investments will be
subject to changes in national and local economic conditions, including
unemployment conditions, which could adversely impact vacancy levels, rental
payment defaults and operating expenses. This, in turn, could substantially
increase the risk of operating losses for the Housing Complexes and the
Partnership. In addition, each Local Limited Partnership is subject to risks
relating to environmental hazards and natural disasters which might be
uninsurable. Because the Partnership's operations will depend on these and other
factors beyond the control of the General Partner and the Local General
Partners, there can be no assurance that the anticipated low income housing
credits will be available to Limited Partners.
In addition, Limited Partners are subject to risks in that the rules governing
the low income housing credit are complicated, and the use of credits can be
limited. The only material benefit from an investment in Units may be the low
income housing credits. There are limits on the transferability of Units, and it
is unlikely that a market for Units will develop. All management decisions will
be made by the General Partners.
Method of Accounting For Investments in Limited Partnerships
The Partnership accounts for its investments in limited partnerships using the
equity method of accounting, whereby the Partnership adjusts its investment
balance for its share of the Local Limited Partnership's results of operations
and for any distributions received. The accounting policies of the Local Limited
Partnerships are consistent with those of the Partnership. Costs incurred by the
Partnership in acquiring the investments are capitalized as part of the
investment and are being amortized over 30 years.
Offering Expenses
Offering expenses consist of underwriting commissions, legal fees, printing,
filing and recordation fees, and other costs incurred with selling limited
partnership interests in the Partnership. WNC is obligated to pay all offering
and organization costs in excess of 15% (including sales commissions) of the
total offering proceeds. Offering expenses are reflected as a reduction of
limited partners' capital and amounted to $946,704 at the end of all periods
presented.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements, and
the reported amounts of revenues and expenses during the reporting period.
Actual results could materially differ from those estimates.
Cash and Cash Equivalents
The Partnership considers all highly liquid investments with remaining
maturities of three months or less when purchased to be cash equivalents. As of
June 30, 1999, the Partnership had no cash equivalents.
7
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS - CONTINUED
June 30, 1999
(unaudited)
NOTE 1 - ORGANIZATION AND OTHER MATTERS, continued
Net Loss Per Limited Partner Unit
Net loss per limited partnership unit is calculated pursuant to Statement of
Financial Accounting Standards No. 128, Earnings Per Share. Net loss per unit
includes no dilution and is computed by dividing loss available to limited
partners by the weighted average number of units outstanding during the period.
Calculation of diluted net loss per unit is not required.
NOTE 2 - INVESTMENT IN LIMITED PARTNERSHIPS
As of the periods presented, the Partnership has acquired limited partnership
interests in eleven Local Limited Partnerships each of which owns one Housing
Complex consisting of an aggregate of 433 apartment units. The respective
general partners of the Local Limited Partnerships manage the day to day
operations of the entities. Significant Local Limited Partnership business
decisions require approval from the Partnership. The Partnership, as a limited
partner, is generally entitled to 99%, as specified in the Local Limited
Partnership agreements, of the operating profits and losses, taxable income and
losses, and tax credits of the Local Limited Partnerships.
Equity in losses of the local limited partnerships is recognized in the
financial statements until the related investment account is reduced to a zero
balance. Losses incurred after the investment account is reduced to zero are not
recognized. If the Local Limited Partnerships report net income in future years,
the Partnership will resume applying the equity method only after its share of
such net income equals the share of net losses not recognized during the
period(s) the equity method was suspended.
The following is a summary of the investment in limited partnerships and
reconciliation to the limited partnership accounts as of:
June 30, 1999 March 31, 1999
------------- --------------
Investment balance,
beginning of period $ 1,508,351 $ 1,595,464
Equity in loss of limited
partnership (82,637) (82,637)
Distributions (2,921) (750)
Amortization of capitalized
acquisition costs (3,726) (3,726)
--------- ---------
Investment balance,
end of period $ 1,419,067 $ 1,508,351
========= =========
8
<PAGE>
WNC CALIFORNIA HOUSING TAX CREDITS, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS - CONTINUED
June 30, 1999
(unaudited)
NOTE 2 - INVESTMENT IN LIMITED PARTNERSHIPS, continued
Selected financial information for the three months ended June 30 from the
combined financial statements of the limited partnerships in which the
partnership has invested is as follows:
1999 1998
---- ----
Total revenue $ 532,331 $ 450,500
-------- --------
Interest expense 175,643 101,450
Depreciation 150,643 137,950
Operating expenses 312,342 316,450
-------- --------
Total expenses 638,482 555,850
-------- --------
Net loss $ (106,151) $ (105,350)
======== ========
Net loss allocable to the
Partnership $ (105,089) $ (102,375)
======== ========
Net loss recorded by the
Partnership $ (82,637) $ (102,375)
======== ========
NOTE 3 - RELATED PARTY TRANSACTIONS
The Partnership has no officers, employees, or directors. However, under the
terms of the Partnership Agreement the Partnership is obligated to the General
Partner or its affiliates during the current or future years for the following
fees:
(a) Annual Asset Management Fee. An annual asset management fee in an amount
equal to 0.5% of the Invested Assets of the Partnership, as defined.
"Invested Assets" means the sum of the Partnership's investment in Local
Limited Partnerships and the Partnership's allocable share of the amount of
the mortgage loans on and other debts related to the Housing Complexes
owned by such Local Limited Partnerships. Fees of $28,000 and $28,000 were
incurred during the three months ended June 30, 1999 and 1998. The
Partnership paid the General Partners and or their affiliates $0 of those
fees during the three months ended June 30, 1999 and 1998.
(b) Interest in Partnership. The General Partners receive 1% of the
Partnership's allocated Low Income Housing Credits, which approximated
$6,700 for Associates and $750 for Mr. Cooper for the year ended December
31, 1998. The General Partners are also entitled to receive 1% of cash
distributions. There were no distributions of cash to the General Partners
during the three months ended June 30, 1999 and 1998.
The "accrued fees and expenses due to general partner and affiliates" presented
on the balance sheets consists of the following:
June 30, 1999 March 31, 1999
------------- --------------
Asset management fee payable $ 873,504 $ 845,540
Reimbursement for expenses paid
by an affiliate 9,069 2,963
------- -------
$ 882,573 $ 848,503
======= =======
NOTE 4 - INCOME TAXES
No provision for income taxes has been made as the liability for income taxes is
an obligation of the partners of the Partnership.
9
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operation
Financial Condition
The Partnership's assets at June 30, 1999 consisted primarily of $64,000 in cash
and aggregate investments in the eleven Local Limited Partnerships of
$1,419,000. Liabilities at June 30, 1999 primarily consisted of $883,000 of
accrued annual management fees due to the General Partners.
Results of Operations
Three Months Ended June 30, 1999 Compared to Three Months Ended June 30, 1998.
The Partnership's net loss for the three months ended June 30, 1999 was
$(121,000), reflecting a decrease of $25,000 from the net loss experienced for
the three months ended June 30, 1998. The decline in net loss is primarily due
to equity in losses from limited partnerships which declined by $19,000 to
$(83,000) for the three months ended June 30, 1999 from $(102,000) for the three
months ended June 30, 1998. This decrease was a result of the Partnership not
recognizing certain losses of the Local Limited Partnerships. The investments in
such Local Limited Partnerships had reached $0 at June 30, 1999. Since the
Partnership's liability with respect to its investments is limited, losses in
excess of investment are not recognized. Along with the decrease in equity in
losses from limited partnerships there was a decrease in loss from operations of
$6,000 for the three months ended June 30, 1999 to $(38,000), from $(44,000) for
the three months ended June 30, 1998, due to a comparable increase in operating
expense allocations.
Cash Flows
Three Months Ended June 30, 1999 Compared to Three Months Ended June 30, 1998.
Net cash provided during the three months ended June 30, 1999 was $3,000
compared to a net decrease in cash for the three months ended June 30, 1998 of
$(11,000). The change was due primarily to a decrease in operating costs of
$6,000, an increase in distributions from limited partnerships of $3,000 and a
decrease in fees paid to the general partner or affiliates of $5,000.
During the three months ended June 30, 1999 and the year ended March 31, 1999,
accrued payables, which consist primarily of related party management fees due
to the General Partner, increased by $28,000 and $28,000, respectively. The
General Partner does not anticipate that these accrued fees will be paid until
such time as capital reserves are in excess of future foreseeable working
capital requirements of the partnership.
The Partnership expects its future cash flows, together with its net available
assets at June 30, 1999, to be sufficient to meet all currently foreseeable
future cash requirements.
Impact of Year 2000
WNC & Associates, Inc.
Status of Readiness
Information Technology (IT) Systems. The Partnership relies on the IT systems of
WNC, its general partner. IT systems include computer hardware and software used
to produce financial reports and tax return information. This information is
then used to generate reports to investors and regulatory agencies, including
the Internal Revenue Service and the Securities and Exchange Commission. The IT
systems of WNC are year 2000 compliant.
Non-IT Systems. The Partnership also relies on the non-IT systems of WNC. Non-IT
systems include machinery and equipment such as telephones, voice mail and
electronic postage equipment. Except for one telephone system, the non-IT
systems of WNC are year 2000 compliant. The one telephone system will require
the replacement of one computer and one software application, both of which will
be completed on or before October 1, 1999.
10
<PAGE>
Service Providers. WNC also relies on the IT and non-IT systems of service
providers. Service providers include utility companies, financial institutions,
telecommunications carriers, municipalities, and other outside vendors. WNC has
obtained verbal assurances from its material service providers (electrical power
provider, financial institutions and telecommunications carriers) that their IT
and non-IT systems are year 2000 compliant. There can be no assurance that this
compliance information is correct. There also can be no assurance that the
systems of other, less-important service providers and outside vendors will be
year 2000 compliant.
Costs to Address Year 2000 Issues
The cost to address year 2000 issues for WNC has been less than $20,000. The
cost to replace the telephone system noted above will be less than $5,000. The
cost to deal with potential year 2000 issues of other outside vendors cannot be
estimated at this time.
Risk of Year 2000 Issues
The most reasonable and likely result from non-year 2000 compliance of systems
of the service providers noted above will be the disruption of normal business
operations for WNC. This disruption would, in turn, lead to delays in performing
reporting and fiduciary responsibilities on behalf of the Partnership. The worst
case scenario would be the replacement of a service provider. These delays would
likely be temporary and would likely not have a material effect on the
Partnership or WNC.
Local Limited Partnerships
Status of Readiness
WNC is in the process of obtaining year 2000 certifications from each Local
General Partner of each Local Limited Partnership. Those certifications will
represent to the Partnership that the IT and non-IT systems critical to the
operation of the Housing Complexes and investor reporting to the Partnership are
year 2000 compliant. These certifications will also represent to the Partnership
that the IT and non-IT systems of property management companies, independent
accountants, electrical power providers, financial institutions and
telecommunications carriers used by the Local Limited Partnership are year 2000
compliant.
There can be no assurance that the representations in the certifications will be
correct. There also can be no assurance that the systems of other,
less-important service providers and outside vendors, upon which the Local
Limited Partnerships rely, will be year 2000 compliant.
Costs to Address Year 2000 Issues
There will be no cost to the Partnership as a result of assessing year 2000
issues for the Local Limited Partnerships. The cost to deal with potential year
2000 issues of the Local Limited Partnerships cannot be estimated at this time.
Risk of Year 2000 Issues
There may be Local General Partners who indicate that they or their property
management company are not year 2000 compliant and do not have plans to become
year 2000 compliant before the end of 1999. There may be other Local General
Partners who are unwilling to respond to the certification request. The most
likely result of either non-compliance or failure to respond will be the removal
and replacement of the property management company and/or the Local General
Partner with year 2000 compliant operators.
11
<PAGE>
Despite the efforts to obtain certifications, there can be no assurance that the
Partnership will be unaffected by year 2000 issues. The most reasonable and
likely result from non-year 2000 compliance will be the disruption of normal
business operations for the Local Limited Partnerships, including but not
limited to the possible failure to properly collect rents and meet their
obligations in a timely manner. This disruption would, in turn, lead to delays
by the Local Limited Partnerships in performing reporting and fiduciary
responsibilities on behalf of the Partnership. The worst-case scenario would
include the initiation of foreclosure proceedings on the property by mortgage
debt holders. Under these circumstances, WNC or its affiliates will take actions
necessary to minimize the risk of foreclosure, including the removal and
replacement of a Local General Partner by the Partnership. These delays would
likely be temporary and would likely not have a material effect on the
Partnership or WNC.
Item 3. Quantitative and Qualitative Disclosures About Market Risks
NOT APPLICABLE
Part II. Other Information
Item 1. Legal Proceedings
NONE
Item 6. Exhibits and Reports on Form 8-K
1. A report on Form 8-K dated May 13, 1999 was filed on May 14, 1999
reporting the change in fiscal year end to March 31.
12
<PAGE>
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.
WNC CALIFORNIA HOUSING TAX CREDITS, L.P.
By: WNC & Associates, Inc. General Partner
By: /s/ John B. Lester, Jr.
John B. Lester, Jr., President
WNC & Associates, Inc.
Date: August 26, 1999
By: /s/ Michael L. Dickenson
Michael L. Dickenson, Vice-President - Chief Financial Officer
WNC & Associates, Inc.
Date: August 26, 1999
13
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000845750
<NAME> WNC CALIFORNIA HOUSING CREDITS, L.P.
<MULTIPLIER> 1
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-2000
<PERIOD-START> APR-01-1999
<PERIOD-END> JUN-30-1999
<EXCHANGE-RATE> 1
<CASH> 63,713
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 63,713
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,482,780
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 600,207
<TOTAL-LIABILITY-AND-EQUITY> 1,482,780
<SALES> 0
<TOTAL-REVENUES> 469
<CGS> 0
<TOTAL-COSTS> 38,596
<OTHER-EXPENSES> 82,637
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (120,764)
<INCOME-TAX> 0
<INCOME-CONTINUING> (120,764)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (120,764)
<EPS-BASIC> (16)
<EPS-DILUTED> 0
</TABLE>
