SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
------------------
For Quarter Ended March 31, 1998 Commission File No. 33-28562
TOUCAN GOLD CORPORATION
(Exact name of registrant as specified in charter)
Delaware 75-2661571
- --------------------------------------------------------------------------------
(State or other jurisdiction (IRS Employer Identification No.)
at incorporation)
8201 Preston Road, Suite 600
Dallas, Texas 75225
- --------------------------------------------------------------------------------
(Address of principal (Zip Code)
executive offices)
Registrant's telephone number, including area code: (214) 890-8088
(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 X NO
--- ---
As of March 31, 1998, there were 7,714,600 shares of the common stock, $.01 par
value, of the registrant issued and outstanding.
Transitional Small Business Disclosure Format (check one)
YES NO X
--- ---
1
<PAGE>
TOUCAN GOLD CORPORATION
March 31, 1998
INDEX
PART I. FINANCIAL INFORMATION Page No.
--------
Item 1. Financial Statements
------
Consolidated Balances Sheets as of March 31,
1998 and December 31, 1997.............................. F-1
Consolidated Statements of Operations for the
three months ended March 31, 1998 and 1997.............. F-2
Consolidated Statements of Stockholders' Equity
for the three months ended March 31, 1998
and the year ended December 31, 1997.................... F-3
Consolidated Statements of Cash Flows for the
three months ended March 31, 1998 and 1997.............. F-4
Notes to Consolidated Financial Statements................ F-5
Item 2. Management's Discussion and Analysis of
------ Financial Condition and Results of Operations........... 3
PART II. OTHER INFORMATION......................................... 6
Item 1. Legal Proceedings......................................... 6
------
Item 2. Changes in Securities..................................... 6
------
Item 3. Default Upon Senior Securities............................ 7
------
Item 4. Submission of Matters to a Vote of Security Holders....... 7
------
Item 5. Other Information......................................... 7
------
Item 6. Exhibits and Reports on Form 8-K.......................... 7
------
SIGNATURES.................................................................. 8
2
<PAGE>
<TABLE>
<CAPTION>
Toucan Gold Corporation
(a development stage company)
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
ASSETS 1998 1997
---------- ------------
<S> <C> <C>
Cash $ 43,333 $ 504,795
Prepaid expenses 16,079 16,375
------------ -----------
Total current assets 59,412 521,170
Mineral rights 3,369,431 3,087,895
------------ -----------
$ 3,428,843 $ 3,609,065
============ ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Amounts payable to related parties $ 57,912 $ 131,139
Accrued expenses and other liabilities 98,012 67,974
------------ -----------
Total current liabilities 155,924 199,113
Stockholders' equity
Preferred stock, par value .01 per share; authorized, 2,000,000
shares; issued and outstanding, none - -
Common stock, $.01 par value per share; authorized 30,000,000
shares; issued and outstanding, 8,039,933 shares 80,399 80,399
Additional paid-in capital 4,488,606 4,488,606
Deficit accumulated during the development stage (1,296,086) (1,159,053)
------------ -----------
Total stockholders' equity 3,272,919 3,409,952
------------ -----------
$ 3,428,843 $ 3,609,065
============ ===========
</TABLE>
The accompanying notes are an integral part of these statements.
F-1
<PAGE>
<TABLE>
<CAPTION>
Toucan Gold Corporation
(a development stage company)
CONSOLIDATED STATEMENTS OF OPERATIONS
For the three months ended March 31,
For the period
November 3, 1995
(commencement
of operations)
through
1998 1997 March 31, 1998
----------- --------- -----------------
<S> <C> <C> <C>
Cost and expenses
Legal, consulting and professional fees $ 91,704 $ 256,055 $ 823,941
Travel costs 3,697 31,738 242,768
Public relations 21,369 7,110 114,637
Other 22,117 3,339 145,070
------------ ------------ -------------
Total cost and expenses 138,887 298,242 1,326,416
Other (income) expense
Interest income (1,854) (15,421) (78,672)
Interest expense - - 48,342
------------ ------------ -------------
Total other income (1,854) (15,421) (30,330)
------------ ------------ -------------
Net loss $ 137,033 $ 282,821 $ 1,296,086
============ ============ =============
Loss per share $ .02 $ .04 $ .21
============ ============ =============
Weighted average shares outstanding 8,039,933 7,432,600 6,101,367
============ ============ =============
</TABLE>
The accompanying notes are an integral part of these statements.
F-2
<PAGE>
<TABLE>
<CAPTION>
Toucan Gold Corporation
(a development stage company)
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
For the three months ended March 31, 1998
and the year ended December 31, 1997
Deficit
accumulated
Additional during
Common stock paid-in development
Shares Amount capital stage Total
---------- ---------- ----------- ------------ -----------
<S> <C> <C> <C> <C> <C>
Balance at January 1, 1997 7,432,600 $ 74,326 $ 4,050,679 $ (434,506) $ 3,690,499
Issuance of common stock 607,333 6,073 437,927 - 444,000
Net loss - - - (724,547) (724,547)
Balance at December 31, 1997 8,039,933 80,399 4,488,606 (1,159,053) 3,409,952
Net loss - - - (137,033) (137,033)
Balance at March 31, 1998 8,039,933 $ 80,399 $ 4,488,606 $ (1,296,086) $ 3,272,919
========= ======== =========== ============ ===========
</TABLE>
The accompanying notes are an integral part of these statements.
F-3
<PAGE>
<TABLE>
<CAPTION>
Toucan Gold Corporation
(a development stage company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the three months ended March 31,
For the period
November 3, 1995
(commencement
of operations)
through
1998 1997 March 31, 1998
------ ------ ---------------
<S> <C> <C> <C>
Operating activities
Net loss $ (137,033) $ (282,821) $ (1,296,086)
Net changes in operating assets and liabilities
Prepaid expenses 296 (27,210) (16,079)
Accrued expenses and other liabilities (80,273) 258,078 118,840
---------- ---------- ------------
Net cash used in operating activities (217,010) (51,953) (1,193,325)
Investing activities
Acquisition of mineral rights (281,536) (219,878) (3,003,431)
Financing activities
Net borrowings from related parties 37,084 22,703 37,084
Issuance of common stock, net of expenses - - 4,103,005
Proceeds from merger with Starlight Acquisitions, Inc. - - 100,000
---------- ---------- ------------
Net cash provided by financing activities 37,084 22,703 4,240,089
---------- ---------- ------------
Net increase (decrease) in cash (461,462) (249,128) 43,333
Cash at beginning of period 504,795 2,031,045 -
---------- ---------- ------------
Cash at end of period $ 43,333 $1,781,917 $ 43,333
========== ========== ============
</TABLE>
The accompanying notes are an integral part of these statements.
F-4
<PAGE>
Toucan Gold Corporation
(a development stage company)
NOTES TO FINANCIAL STATEMENTS
March 31, 1998
NOTE A - BASIS OF PRESENTATION
Organization
The consolidated financial statements contained herein have been
prepared by the Company pursuant to the rules and regulations of the
Securities and Exchange Commission. In the opinion of management, all
adjustments necessary for a fair presentation of the consolidated financial
position as of March 31, 1998, and the consolidated results of operations
for the three (3) months ended March 1998 and 1997, and the consolidated
cash flows for the three (3) months ended March 31, 1998 have been made. In
addition, all such adjustments made, in the opinion of management, are of a
normal recurring nature. The results of operations for the periods presented
are not necessarily indicative of the results to be expected for the full
fiscal year.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to the interim
reporting rules of the Securities and Exchange Commission. The interim
consolidated financial statements should be read in conjunction with the
audited consolidated financial statements and related notes for the year
ended December 31, 1997, included in the Company's 1997 Annual Report on
Form 10-KSB.
NOTE B - COMMITMENT
Under an agreement with a Brazilian individual, the Company is
committed to acquire 10 additional priority claims upon clearance of title
by the DNPM. The consideration for each claim will be $36,000 in cash and
12,000 shares of common stock. In addition, a bonus payment of 50,000 shares
is due to the seller if all 10 claims are delivered to the Company.
F-5
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Effective May 10, 1996, Starlight Acquisitions, Inc., a Colorado
corporation ("Starlight") acquired all of the outstanding capital stock of
Toucan Mining Limited, an exploration stage company incorporated under the laws
of the Isle of Man (British Isles) ("Toucan Mining") in exchange for shares of
Starlight Common Stock (the "Share Exchange"). As a result of the Share
Exchange, a change in control of Starlight occurred, whereby Toucan Mining is
deemed to have acquired Starlight. See "Notes to the Consolidated Financial
Statements."
Toucan Mining is a development stage company that conducts its operations
primarily through its wholly-owned subsidiary, Mineradora de Bauxita Ltda.
("MBL"), which is an authorized mining company organized under the laws of
Brazil. MBL has been financed entirely by Toucan Mining for the purpose of
conducting mineral exploration, specifically gold exploration.
During July 1996, Starlight formed Toucan Gold Corporation, a Delaware
corporation ("Toucan" or the "Company"), as a wholly-owned subsidiary. on July
29, 1996, Starlight merged into the Company, and pursuant to the terms of the
merger, the outstanding shares of Starlight Common Stock were canceled in
exchange for shares of the Company's Common Stock.
The consolidated financial statements for the fiscal year ended December
31, 1997, reflect the results of Toucan's operations, which consisted of opening
and operating a Brazilian exploration office, completion of a 5,000 meter
reverse circulation drilling program, maintenance of Toucan Mining and MBL's
various claims and purchase of new claims which were capitalized in the
financial statements. Legal, accounting, investor relations, consulting, travel,
subsistence expenses and other general administrative costs were expensed.
The Company has begun a program of mineral exploration to target and
explore selected areas of its mining claims to determine which areas are most
likely to contain economic gold mineralization or to effectuate this program
through joint ventures. In order to facilitate these activities, the Company, in
March 1997, opened an office in Brazil. The Brazilian office is staffed by
fifteen employees and consultants, consisting of geologists, land acquisition
personnel, mapping specialists and various support personnel.
The Company has completed a 5,000 meter reverse circulation drilling
program involving six separate locations in the Cuiaba District on which
artisanal mine works ("nugget patches") have taken place. The Company believes
that these nugget patches are de facto geochemical anomalies reflecting the
possible presence of disseminated gold mineralization in the subsurface. A total
of 73 holes were drilled to an average depth of 69 and sampled at one-meter
intervals. In addition to intersecting variable quantities of "visible gold" at
all six of the localities tested, drilling has revealed the presence of
metasediments which imbedded with metavolcanic rocks of Prozterzoic age. Samples
weighing approximately 25 kg. were split, and approximately 3 kg. from each
sample were sent for assay testing at two well-known Canadian laboratories.
The Company's drilling program was designed to penetrate the upper
saprolite and geochemically sample lower saprolitic material. Management
expected any gold mineralization in the lower saprolite to be finer grained,
more homogeneous and reliably sampled by reverse circulation drilling. However,
the assay reports reflected a wide variation of results. Because such results
can occur when sampling "coarse gold" mineralization, management conducted
additional testing of the samples utilizing a commonly practiced manual
inspection technique, which revealed the presence of "visible gold" in some of
the samples, many of which had appeared, on the basis of the prior assay, to
have negligible gold content. Based on such testing, management believes that
the weathering of the saprolite extends deeper into the surface than was
originally estimated and that its drilling did not sample the lower saprolite.
Because of the indication of coarse gold mineralization, management concluded
that it could not rely upon the individual values obtained in the original
assay. Accordingly, management resubmitted 132 larger samples containing
"visible gold" for re-assaying to one of the Canadian laboratories that tested
the original samples in order to use such laboratory's special method of sample
preparation suited for the detection and measurement of coarse gold
mineralization. Most of the later assayed samples were found to contain
consistently higher gold content than the previously assayed samples. Management
believes that almost all of the drilling to date has intersected fringe-type
mineralization of the type often found near stronger potential economic
mineralization.
3
<PAGE>
Management is encouraged by the results of the overall geochemical testing
program and believes that the new sample collection and processing method will
more accurately reflect the level and grade of gold mineralization present in
the upper saprolite. Accordingly, subject to raising additional capital, the
Company has planned a detailed program on the six previously mentioned locations
and their adjacent areas of advanced technology soil geochemistry testing and
detailed ground geophysics using electric and magnetic methods. The program will
also cover further geological mapping of the remaining nugget patches. More
reverse circulation drilling on all of these areas (testing appropriately larger
samples) is expected to follow. This program is expected to take fourteen (14)
months and is designed to establish whether there are potential orebodies in the
upper saprolite in these areas. This program could involve joint ventures and
other arrangements that may result in a dilution of the Company's interest in
its mining claims.
Additional regional exploration, to be carried out concurrently with the
detailed "nugget patch" exploration, is planned and will be aimed at identifying
the mineralization potential of all MBL claims in order to discard those without
any potential. This is to be carried out by revision of all geologic information
and supported by Landsat Thematic Mapper, extensive field work, and a regional
airborne geophysical survey over the area of highest potential. The Company has
commissioned 4,300 kilometer aerial geophysical survey of part of its priority
claims and is currently awaiting appropriate governmental licenses prior to
proceeding with this aspect of the exploration program.
However, the program to fully explore and develop its entire claim area
will take several years, and it could involve joint ventures or other
arrangements that may result in a dilution of the Company's interest in its
claims. In the event of encouraging results in a particular area, a more
concentrated study will be undertaken to provide the basis of a feasibility
study for mineral development. MBL will also be working to acquire additional
claims in the Cuiaba Basin and will cease to explore those claims that prove
unproductive.
The Company will incur major expenses to establish the existence of gold
reserves. Accordingly, to fund the Company's exploration program through May,
1999 and to pay for normal expenses during that period, the Company believes
that it will need to raise approximately $1.6 million or enter into joint
ventures with industry partners who agree to provide such funds. The amount does
not include any expenditures for lease acquisitions. There can be no assurance
that the Company will be able to raise such capital if needed or on terms that
are favorable to the Company or to enter into such joint ventures on terms
favorable to the Company. The plan will be subject to review depending upon the
results obtained. Costs could rise if, among other things, the weather proves
untypically harsh, unforeseen ground conditions are encountered, equipment
becomes difficult to source, the availability of drilling operators becoming
increasingly scarce and their rates increasing accordingly, or negotiations with
surface owners become prolonged. MBL may spend more or less on claim
acquisitions than currently estimated. There can be no assurance that the
exploration program will result in the discovery of economic gold
mineralization. The Company's financial statements have been prepared assuming
that the Company will continue as a going concern. Furthermore, the
recoverability of the cost of mineral rights is dependent on the Company's
ability to continue exploration, establish the existence of economically
recoverable reserves, develop these reserves, and achieve profitable production
or obtain sufficient proceeds from the disposition of the rights. The Company's
financial statements do not include any adjustments that might result from the
outcome of these uncertainties. The matters discussed herein contain
forward-looking statements that involve certain risks, uncertainties and
additional costs detailed herein. The actual results that are achieved may
differ materially from any forward-looking projections, due to such risks,
uncertainties and additional costs.
The Company has raised approximately $3.6 million in net proceeds through
the issuance of 1,600,000 Units at $2.50 per Unit, each Unit consisting of one
share of Company Common Stock and a warrant to purchase a share of Company
Common Stock at an exercise price of $3.50, in an offering exempt from
registration under the Securities Act pursuant to Regulation S. This offering
was completed on November 1, 1996. The expiration date for such warrants was set
at the close of business on October 31, 1997, subject to adjustment in
connection with certain anti-dilution provisions. On October 31, 1997, the
expiration date for the warrants was extended by the Company from October 31,
1997 to January 31, 1998. The warrants have expired by their terms.
The Company has used certain of the proceeds from the sale of the Units to
finance the purchase of additional mining claims in the Cuiaba Basin, to begin
its exploration program, and for general working capital purposes. The Company
has entered into an agreement to acquire up to 25 claims in the Cuiaba Basin.
See Part II, Item 2, (c) (i) of this Form 10-QSB. Under this agreement, the
Company is committed to acquire 10 additional priority claims upon clearance of
4
<PAGE>
title by the DNPM. The consideration for each claim will be $36,000 in cash and
12,000 shares of common stock. In addition, a bonus payment of 50,000 shares is
due to the seller if all 10 claims are delivered to the Company. The Company's
obligations thereunder are subject to its review of documentation relating to
such claims. There can be no assurance that the acquisition of the remaining
claims will be consummated.
In order to finance the Company's exploration activities and general
working capital needs, including maintaining its Brazilian office and paying the
personnel of the Brazilian office, the Company will require additional capital.
The Company is exploring several financing alternatives to obtain such
additional capital. The Company is currently funding its day-to-day operations
with a demand loan from Zalcany Limited ("Zalcany"), a company affiliated with
Roy G. Williams, while it continues to seek additional financing. The loan from
Zalcany bears interest at the annual rate of 10% and is unsecured. As of May 12,
1998, the principal amount of the loan was $101,429 and shall be repaid with the
proceeds of any additional financing. Zalcany has indicated to the Company an
intent to provide additional short-term financing on the same basis in
anticipation of the Company obtaining longer-term additional financing in a
short period of time; however, Zalcany is not obligated to advance additional
funds to the Company.
Certain of the information contained in this Annual Report on Form 10-QSB
constitutes forward looking statements within the meaning of Section 27A of the
Securities Act and Section 21E of the Securities Exchange Act of 1934, as
amended, that involves certain risks, uncertainties and additional costs
described herein. The actual results that are achieved may differ materially
from any forward looking projections, due to such risks, uncertainties and
additional costs. Although the Company believes that the expectations reflected
in such forward looking statements are based upon reasonable assumptions, it can
give no assurance that its expectations will be achieved. Subsequent written and
oral forward looking statements attributable to the Company or persons acting on
its behalf are expressly qualified in their entirety by reference to such risks,
uncertainties and additional costs.
5
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
None
Item 2. Changes in Securities.
(a) None
(b) None
(c) (i) On November 1, 1996, the Company, pursuant to the exemption
from registration provided by Regulation S of the Securities Act of 1933, as
amended (the "Securities Act"), completed the offering (the "Yorkton Offering")
of 1,600,000 Units for aggregate gross proceeds of $4 million.
Certain of the net proceeds of the Yorkton Offering were to be used by
MBL or another Brazilian mining subsidiary of the Company to acquire mining
claims in the Cuiaba Basin. These claims, which number twenty-five (25) in the
aggregate, are in the process of being acquired pursuant to the following
agreement and understanding:
(A) The Company made an initial payment to the seller
in the amount of $500,000. Upon receiving this
initial payment, the seller granted to
representatives of the Company (the
"Representatives") an irrevocable power-of-attorney
over all twenty-five (25) claims.
(B) The Company paid to the seller cash in the amount
of $36,000 for each claim that the Departmento
Nacional De Produca Mineral ("DNPM") certifies is
held with priority, having good, clean and a
transferable title. The DNPM is the Brazilian
governmental agency responsible for regulating
mineral rights.
(C) The Company issued to the seller 12,000 shares of
the Company Common Stock for each claim that the DNPM
certifies is held with priority, having good, clean
and transferable title.
(D) The Company issued to the seller a bonus payment
of 50,000 shares of the Company Common Stock if and
when the seller transfers good and clean title to all
twenty-five (25) claims to the Company.
As noted above, the initial payment of $500,000 has been made by the
Company to the seller. Hence, the Representatives on behalf of the Company now
hold an irrevocable power-of-attorney over all such claims, which entitles the
Company, upon payment for such claims as hereinabove provided, to transfer such
claims to MBL or another subsidiary of Toucan Mining. In December 1996, fourteen
(14) of the twenty-five (25) claims were certified by the DNPM as held in
priority, with good, clean and transferable title. In April 1997, two (2)
additional claims were certified by the DNPM as held in priority, with good,
clean and transferrable title. In March of 1998, the Company was informed by the
DNPM that the seller did not hold priority title on one of the sixteen (16)
claims. As a result, the Company currently holds priority claim on only fifteen
(15) claims. Accordingly, the Company is obligated to issue to seller 180,000
(15 x 12,000) shares of Company Common Stock. The shares of Company Common Stock
to be issued in connection with this transaction have been authorized, but as of
March 31, 1998, they have not been issued.
(ii) On February 2, 1998, the Company granted options to purchase, in
the aggregate, 250,000 shares of Company Common Stock to two separate
individuals in their capacities as Directors of the Company. The options allowed
Robert P. Jeffcock and Robert A. Pearce to purchase 200,000 and 50,000 shares of
Company Common Stock, respectively, at an exercise price of $1.00 per share. Mr.
Jeffcock and Mr. Pearce received their options as part of their remuneration for
services rendered to the Company. Each individual's options vested on the date
of grant and are exercisable up until December 31, 1999.
6
<PAGE>
The securities placements described in paragraphs (a) and (b) above
were effectuated pursuant to the exemption from registration set forth in
Section 4(2) and Regulation D of the Securities Act of 1933, as amended (the
"Securities Act"); therefore, such securities are "restricted securities" under
Rule 144 of the Securities Act.
Item 3. Default Upon Senior Securities.
None
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
EXHIBITS
The following exhibits are furnished in accordance with Item 601 of Regulation
S-B.
10.1 (1) Option Agreement, dated February 2, 1998, by and between the Company
and Robert P. Jeffcock (Exhibit 10.3).
10.2(1) Option Agreement, dated February 2, 1998, by and between the Company and
Robert A. Pearce (Exhibit 10.4).
27* Financial Data Schedule
- ------------------
* filed herewith
(1) Incorporated by reference to the exhibit shown in parenthesis included
in the Company's Annual Report or Form 10-KSB for the period ended
December 31, 1997, filed by the Company with the Securities and
Exchange Commission.
Form 8-K: No reports on Form 8-K have been filed with the Securities and
Exchange Commission in the quarter ended March 31, 1997.
7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this Quarterly Report to be signed on its behalf
by the undersigned thereunto duly authorized.
TOUCAN GOLD CORPORATION
(Registrant)
Date: May 20, 1998 By: /s/ Robert P. Jeffcock
---------------------------------------
Robert P. Jeffcock, President and Chief
Executive Office (Principal Executive
Officer)
By: /s/ Robert A. Pearce
---------------------------------------
Robert A. Pearce, Chief Financial
Officer (Principal Financial Officer
and Chief Accounting Officer)
8
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
Financial Data Schedule
</LEGEND>
<CIK> 0000850083
<NAME> Toucan Gold Corporation
<MULTIPLIER> 1
<CURRENCY> 1.00
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<EXCHANGE-RATE> 1.00
<CASH> 43,333
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 59,412
<PP&E> 3,369,431
<DEPRECIATION> 0
<TOTAL-ASSETS> 3,428,843
<CURRENT-LIABILITIES> 155,924
<BONDS> 0
0
0
<COMMON> 80,399
<OTHER-SE> 3,192,520
<TOTAL-LIABILITY-AND-EQUITY> 3,428,843
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 138,887
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (137,033)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (137,033)
<EPS-PRIMARY> (.02)
<EPS-DILUTED> (.02)
</TABLE>
