U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[x] QUARTERLY REPORT PURSUANT SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: March 31, 1997
[ ] TRANSITION REPORT PURSUANT SECTION 13 OF 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________________ to _______________
Commission file number 0-28704
CLASSIC RESTAURANTS INTERNATIONAL, INC.
(Exact name of small business issuer as specified in its charter)
COLORADO 84-1122431
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
3500 PARKWAY LANE, SUITE 435, NORCROSS, GEORGIA 30092
(Address of principal executive offices)
(770)729-9010
(Issuer's telephone number)
NOT APPLICABLE
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes ___X___ No ______
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the last practicable date:
3,594,089 SHARES OF CLASS A COMMON STOCK, NO PAR VALUE
200,000 SHARES OF CLASS B COMMON STOCK, NO PAR VALUE
AS OF MARCH 31, 1997
Transitional Small Business Disclosure Format (check one): Yes_____ No ___X__
Exhibit index on page 10 Page 1 of 18 pages
<PAGE>
CLASSIC RESTAURANTS INTERNATIONAL, INC.
TABLE OF CONTENTS
PAGE
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheet dated March 31, 1997 3
Consolidated Statement of Operations 4
Consolidated Statements of Cash Flows for the
Nine Months Ended March 31, 1996 and 1997 5
Notes to Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial 6
Condition and Results of Operations
PART II. OTHER INFORMATION 9
2
<PAGE>
<TABLE>
CLASSIC RESTAURANTS INTERNATIONAL, INC
CONSOLIDATED BALANCE SHEET
MARCH 31, 1997
(UNAUDITED)
<CAPTION>
ASSETS
<S> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 32,866
Accounts receivable 22,654
Inventory 15,811
Due from affiliates 84,452
Prepaid and other current assets 155,295
--------
Total current assets 311,078
PROPERTY AND EQUIPMENT:
Furniture and equipment 288,198
Leasehold improvements 520,321
Vehicles 6,228
------
Total property and equipment 814,747
Accumulated depreciation (431,758)
382,989
OTHER ASSETS:
Deposits 39,119
Organization costs, net of accumulated
amortization of $8,998 21,002
-------
60,121
TOTAL ASSETS $ 754,188
=======
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C>
CURRENT LIABILITIES:
Accounts payable $ 263,447
Accrued expenses 21,087
Taxes payable 32,572
Other current liabilities 130,783
--------
Total current liabilities 447,889
NOTES AND LOANS PAYABLE 294,949
STOCKHOLDERS' EQUITY:
Preferred stock, Series A, 18 shares
at $25,000 stated value authorized,
issued and outstanding 450,000
Common stock, Class A, no par value,
1,800,000,000 shares authorized,
3,594,089 shares issued and outstanding 3,472,545
Common stock, Class B, no par value,
200,000,000 shares authorized,
200,000 shares issued and outstanding 200
Accumulated deficit (3,911,395)
----------
Total stockholders' equity 11,350
-------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 754,188
========
</TABLE>
The accompanying notes are an integral part of this balance sheet.
3
<PAGE>
<TABLE>
CLASSIC RESTAURANTS INTERNATIONAL, INC
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<CAPTION>
For the three months For the nine months
ended March 31, ended March 31,
1996 1997 1996 1997
------ ------ ------ -----
<S> <C> <C> <C> <C>
Net Sales $ 875,500 $ 715,948 $ 1,153,150 $1,831,781
Operating Expenses:
Operating and maintenance 568,353 498,284 882,716 1,419,888
General and administrative 253,126 483,589 351,273 1,178,530
Depreciation and amortization 35,573 35,899 100,812 107,688
------- ------- -------- --------
Total Operating Expenses 857,052 1,017,772 1,334,801 2,706,106
-------- --------- ---------- ----------
Income (Loss) From Operations 18,448 (301,824) (181,651) (874,325)
======= ======== ========= =========
Other Income (expense):
Other income - - - 7,000
Interest income - - - 410
Interest Expense (1,890) (13,260) (124,439) (42,162)
------- -------- --------- --------
(1,890) (13,260) (124,439) (34,752)
------- -------- --------- --------
Net Income (Loss) $ 16,558 $ (315,084) $ (306,090) $ (909,077)
======= ========= ========= =========
Per share information:
Weighted average shares
outstanding
Primary 3,259,632 3,698,851 3,259,632 3,456,763
========= ========= ========= =========
Net income (loss) per share:
Primary $ 0.01 $ (0.09) $ (0.09) $ (0.26)
===== ====== ====== ======
</TABLE>
The accompanying notes are an integral part of these statements.
4
<PAGE>
<TABLE>
<CAPTION>
CLASSIC RESTAURANTS INTERNATIONAL, INC
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED MARCH 31, 1996 AND 1997
(UNAUDITED)
1996 1997
---------- ----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (306,090) $ (909,077)
--------- ---------
Adjustments to reconcile net loss to net
cash provided by (used in) operating activities -
Depreciation and amortization 100,812 107,688
Net changes in assets and liabilities -
Decrease (increase) in accounts receivable 1,709 (18,969)
Decrease in inventory 1,388 269
Increase in prepaid expenses (42,175) (141,350)
Decrease in bank overdrafts (35,035) -
(Decrease) increase in trade accounts payable (125,228) 76,353
Decrease in accrued expenses (253,193) (129,932)
Increase in taxes payable 165,724 32,572
Increase in other current liabilities 37,650 43,281
--------- ----------
Total adjustments (148,348) (30,088)
--------- ----------
Net cash used in operating activities (454,438) (939,165)
--------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Advance to stockholder (402,158) -
Capital expenditures (273,794) (11,911)
Organization costs (656) -
--------- ----------
Net cash used in investing activities (676,608) (11,911)
--------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from related party 1,018,514 -
Receipt of stock subscription 230,000 -
Payment of deposits (31,591) (1,701)
Advances to affiliates (195,772) (32,364)
Payment of advances from stockholders - (320,641)
Payment of long-term debt (111,398) (43,499)
Proceeds from stock issuance 276,500 1,359,388
--------- ---------
Net cash provided by financing activities 1,186,253 961,183
--------- ---------
NET INCREASE IN CASH AND CASH EQUIVALENTS 55,207 10,107
CASH AND CASH EQUIVALENTS, beginning of period 3,160 22,759
--------- ---------
CASH AND CASH EQUIVALENTS, end of period $ 58,367 $ 32,866
========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
5
<PAGE>
CLASSIC RESTAURANTS INTERNATIONAL, INC.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1997
(UNAUDITED)
1. BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and Item 310(b) of Regulation SB. They do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all adjustments
(consisting only of normal recurring adjustments) considered necessary for a
fair presentation have been included. The results of operations for the periods
presented are not necessarily indicative of the results to be expected for the
full year. For further information, refer to the financial statements of the
Company as of June 30, 1996, and the notes thereto, included in the Company's
Form 10-KSB.
2. COMMON STOCK
For the period July 1, 1996 to March 31, 1997, 575,497 additional
shares of Class A common stock were issued.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 1997 the Company had a working capital deficit of $136,811,
compared to a working capital deficit of $297,316 on March 31, 1996. On March
31, 1997, and March 31, 1996, the Company had cash and cash equivalents of
$32,866, and $58,367, respectively. The increase in working capital can be
attributed to a number of items.
The Company has entered into a consulting agreement with Continental Capital and
Equity Corporation ("Continental Capital") to assist the Company with its public
relations and promotional activities. The Company prepaid this agreement, with
cash and stock, which contributed to the increase in current assets, and working
capital. The stock issued under this agreement was valued at $258,750, which
will be amortized over the life of the agreement. Of the $50,000 in cash which
was paid under the agreement, and the $258,750 of stock issued, $165,875 has
been included in general and administrative expenses for the nine months ended
March 31, 1997. Also, an increase in the amount payable from affiliates resulted
in an increase to current assets and working capital.
Current liabilities were $447,889 and $464,015 on March 31, 1997 and March 31,
1996, respectively. On March 31, 1997, and March 31, 1996, total liabilities
were $742,838 and $929,202, respectively.
6
<PAGE>
The difference in total liabilities between March 31, 1997 and March 31, 1996,
is primarily attributable to the conversion of the note due to a stockholder
into Class A Common Stock.
On March 31, 1997, the Company had total stockholders' equity of $11,350,
contrasted with a stockholders' deficit of $183,999 on March 31, 1996. A private
placement for $500,000, in October, 1996, along with the conversion into equity
of a note due to a shareholder and the stock issued under the consulting
agreements, contributed to the increase in stockholders' equity.
The Company has received subscriptions for 2,918 shares of Series B Convertible
Preferred Stock which, until the Company is authorized to issue this stock, has
been accounted for as equity investments in Class A Common Shares.
Currently, the Company is dependent upon advances from shareholders and the sale
of stock to meet its financing needs. There is no guaranty that the Company will
be able to obtain additional financing from these sources.
RESULTS OF OPERATIONS
The financial statements of the Company for the nine months ended March 31,
1997, are not comparable to the Company's financial statements for the nine
months ended March 31, 1996. Due to the Share Exchange which took place in
January of 1996, the financial statements for the nine months ended March 31,
1996 were those of the Company (formerly known as Casinos International, Inc.
and its wholly-owned subsidiary, Great American Casinos, Inc.), which are not
comparable to the financial statements of the Company and its wholly-owned
operating subsidiaries, Classic Restaurants International, Inc., a Florida
corporation, and Musicana Clearwater, Inc., a Florida corporation, dated March
31, 1997.
For the three and nine months ended March 31, 1997, the Company had net sales of
$715,948 and $1,831,781, respectively. In contrast, net sales for the nine
months ended March 31, 1996 were $1,153,150. For the nine months ended March 31,
1997, operating expenses were $2,706,106, as compared to $1,334,801 for the nine
months ended March 31, 1996. The Company experienced a loss from operations of
$874,325 and a net loss of $909,077, for the nine months ended March 31, 1997.
In contrast, for the nine months ended March 31, 1996, the Company had a loss
from operations of $181,651 and a net loss of $306,090.
Operating and maintenance expenses for the nine months ended March 31, 1997,
were $1,419,888, in contrast to $882,716 for the nine months ended March 31,
1996. The Company's general and administrative expenses were $1,178,530 and
$351,273 for the nine months ended March 31, 1997 and March 31, 1996,
respectively. General and Administrative expenses for the nine months ending
March 31, 1997 include, among other things, Accounting Fees ($56,422),
Advertising ($49,608), Consulting Fees ($192,085), Legal Fees ($64,689), Loan
Fee Expense ($39,375), Promotion Expense ($173,382), Rent ($203,064), Travel
($31,054) and Abandoned Projects ($60,000).
7
<PAGE>
Consulting fees include, among other items, the previously mentioned expenses
for the Company's agreements with Continental Capital and Bridgewater, along
with an expense of $84,375 related to an expired consulting agreement the
Company entered into with Cambria Investment Group, Ltd.
In October, 1996, the Company entered into a six (6) month Financial Services
Agreement with Bridgewater Capital Corporation ("Bridgewater"), pursuant to
which Bridgewater will perform investment banking activities for the Company.
Under this agreement, $50,000 has been included in general and administrative
expenses for the nine months ended March 31, 1997, of which $10,000 was paid in
cash and the balance of the agreement was paid in April 1997 with 65,000 shares
of stock registered with the Securities and Exchange Commission on Form S-8.
Interest expense for the nine months ended March 31, 1997, was $42,162, compared
to $124,439 for the nine months ended March 31, 1996.
On October 18, 1996, the Company entered into a Stock Purchase Agreement with
Joseph Rollins to purchase a 67.5% interest in Jocks & Jills Prado, Inc.
("Prado") and a 60.75% interest in Divine Events, Inc. ("Divine"). Prado does
business under the name Frankie's Food - Sports - Spirits, a sports bar located
in Atlanta, Georgia. The Company made an earnest money deposit of $50,000 and
made an additional $10,000 deposit for an extension of the Closing Date. The
Stock Purchase Agreement was terminated on February 7, 1997, and the deposits of
$60,000 have been included in the Company's General and Administrative expenses
for the three and nine months ended March 31, 1997.
The Company has entered into a non-binding letter of intent with Main Event,
Inc., a Delaware corporation ("Main Event"), pursuant to which the Company and
Main Event were to negotiate the terms of a merger and share exchange by April
30, 1997. Pursuant to a letter dated May 15, 1997, the letter of intent has been
extended to May 23, 1997. Main Event is a privately held restaurant and
entertainment management company based in Dallas, Texas. Main Event, through
partnerships in which it is a general and limited partner, creates, develops,
and operates multi-venue restaurant and attraction complexes.
Any such merger is contingent upon the Company having sufficient capital
resources to provide for its operations until such time that an offering of
securities can be made. The terms of the transaction with Main Event have not
been finalized, and management does not know if or when such a transaction will
take place.
8
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
On May 2, 1997, Mark Shoom filed a lawsuit against the Company
and James R. Shaw, individually, in the State Court of
Gwinnett County, Georgia. The complaint alleges that the
Company has failed to repay Mr. Shoom the principal and
interest due to him pursuant to a note between Mr. Shoom and
the Company dated October 9, 1996, in the principal amount of
$80,000 and personally guaranteed by Mr. Shaw. Mr. Shoom is
seeking damages of $93,144 for principal and interest on the
note, plus attorney's fees, costs and additional interest
accruing thereafter. As of May 15, 1997, the Company has not
filed an answer in response to the complaint.
ITEM 2. CHANGES IN SECURITIES.
On January 13, 1997, Voyager Select IPO Fund, Ltd. ("Voyager
Select"), converted 2 shares of Series A Convertible Preferred
Stock into 95,238 shares of the Company's Class A Common Stock
at a conversion price equal to $ 0.525 per share. The Company
received no additional funds for this transaction.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not Applicable.
ITEM 5. OTHER INFORMATION.
Not Applicable.
9
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
<TABLE>
A) EXHIBITS
<CAPTION>
REGULATION SEQUENTIAL
S-B NUMBER EXHIBIT PAGE
NUMBER
<S> <C> <C>
2 PLAN OF PURCHASE, SALE, REORGANIZATION, ARRANGEMENT, N/A
LIQUIDATION, SUCCESSION
3.1 ARTICLES OF INCORPORATION, AS AMENDED (1)<F1> N/A
3.2 BYLAWS, AS AMENDED (2)<F2> N/A
4.1 ARTICLES OF INCORPORATION (3)<F3> N/A
10.1 STOCK PURCHASE AGREEMENT WITH JOCKS & JILLS PRADO, INC. N/A
AND DIVINE EVENTS, INC. (1)<F1>
10.2 Client Service Agreement with Continental Capital & Equity N/A
Corporation dated October 11, 1996 (4)<F4>
10.3 Consulting Agreement with Cambria Investment Group, Ltd. N/A
(4)<F4>
10.4 Letter of Intent with Main Event, Inc., as amended 12
11 STATEMENT RE COMPUTATION OF PER SHARE EARNINGS (5)<F5> N/A
15 LETTER ON UNAUDITED FINANCIAL INFORMATION (5)<F5> N/A
18 LETTER ON CHANGE IN ACCOUNTING PRINCIPLES N/A
19 REPORT FURNISHED TO SECURITY HOLDERS N/A
22 PUBLISHED REPORT REGARDING MATTERS SUBMITTED TO VOTE OF N/A
SECURITY HOLDERS
23 CONSENTS OF EXPERTS AND COUNSEL N/A
24 POWER OF ATTORNEY N/A
27 FINANCIAL DATA SCHEDULE 17
- ------------
<FN>
<F1>
(1) INCORPORATED BY REFERENCE TO THE EXHIBITS FILED WITH THE COMPANY'S FORM
10-QSB FOR THE PERIOD ENDING DECEMBER 31, 1996.
<F2>
(2) INCORPORATED BY REFERENCE TO THE EXHIBITS FILED WITH THE COMPANY'S
ANNUAL REPORTS ON FORM 10-KSB FOR THE FISCAL YEARS ENDED JUNE 30, 1995
AND JUNE 30, 1994 AND THE COMPANY'S CURRENT REPORT ON FORM 8-K DATED
JANUARY 31, 1996, COMMISSION FILE NUMBER 033-33556-D.
<F3>
(3) THE APPLICABLE PROVISIONS OF THE ARTICLES OF INCORPORATION WHICH HAVE
BEEN CHANGED MAY BE FOUND IN EXHIBIT 3.1.
10
<PAGE>
<F4>
(4) INCORPORATED BY REFERENCE TO THE EXHIBITS FILED WITH THE FORM S-8 FILED
ON NOVEMBER 11, 1996, WITH THE SECURITIES AND EXCHANGE COMMISSION, FILE
NUMBER
333-1609.
<F5>
(5) SEE PART I - FINANCIAL STATEMENTS.
</FN>
</TABLE>
B) REPORTS ON FORM 8-K:
None.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
CLASSIC RESTAURANTS INTERNATIONAL, INC.
(Registrant)
Date: May 15, 1997
By:/s/Caroline P. Anderson
Caroline P. Anderson
Executive Vice President and
Chief Financial Officer
10:33197.10Q
11
<PAGE>
Exhibit 10.4
Letter of Intent with Main Event, Inc., as amended
12
<PAGE>
[Letterhead of Classic Restaurants International, Inc.]
March 13, 1997
Main Event, Inc.
12225 Greenville Avenue, Suite 532
Dallas, Texas 75243
Dear Sirs:
This letter will confirm the various discussions that have been held
between Classic Restaurants, Inc., a Colorado corporation (Classic"), and Main
Event, Inc., a Delaware corporation ("Main Event"), relative to a proposed
merger of Main Event with and into Classic (the "Merger").
The objective of our discussions has been the execution, as soon as
[initials in margin]feasible but no later than [text marked out] April 30, 1997
(unless mutually extended by both parties), of a definitive merger agreement
(the "Agreement").
The Agreement shall provide, among other things, for the various
matters set forth below:
1. Main Event shall be merged with and into Classic and the Main Event
shareholders shall receive shares of Classic Class A Common Stock for their
shares of Main Event Common Stock on terms to be set forth in the Agreement in a
transaction which is intended to qualify as a tax free reorganization within the
meaning of Section 368 of the Internal Revenue Code of 1986, as amended.
2. The parties agree that directors and officers of Classic following
the merger shall be the same as the officers and directors of Main Event as of
the date of this letter, except that James Robert Shaw shall be appointed to the
board of directors of Main Event for at least ____ years following the merger.
3. At Closing or as soon as possible after Closing, Classic shall
change its name to Main Event, Inc.
4. The obligations of the parties under the Agreement shall be
expressly subject to, among other things, the following:
a. Compliance by the parties in all material respects with all
applicable laws, orders, and regulations of federal, state, municipal, and/or
other governments and/or any instrumentality thereof, domestic or foreign,
applicable to their assets, to the business conducted by them, and to the
proposed transaction;
13
<PAGE>
[Letterhead of Classic Restaurants International, Inc.]
b. The approval of the transaction by the shareholders of
Classic and Main Event, which approval shall be obtained as soon as possible.
c. The satisfactory completion by each company of its due
diligence review of all books, records, and business financial affairs of the
other company; and
d. Current financial statements of both companies in a form
meeting the requirements for filing with the Securities and Exchange Commission.
5. At the closing, neither Classic nor main Event shall have
experienced any changes in key management positions, any adverse changes in its
business operation, or any significant decreases in its assets.
6. The parties agree that upon execution of this letter Main Event
shall not discuss or explore any other reverse merger transaction with any other
business or individual until the earlier of (a) the mutual determination by all
[markings in margin] parties hereto not to proceed with the proposed transaction
or (b) [text marked out] April 30, 1997 (unless mutually extended).
Upon your execution and return to us of this letter of intent, as of
the date hereof, counsel for classic shall prepare and the parties hereto shall
execute the Agreement containing provisions in accordance with the foregoing,
together with such further items as are appropriate under the circumstances. The
Agreement shall specify the date of Closing and shall contain representations
and warranties relating to, among other things, the business, financial
conditions, certain legal matters and properties of Classic and Main Event, the
securities to be issued by Classic, securities issued and outstanding of Main
Event and Classic, and other matters deemed appropriate and usual in
transactions of this nature. No party hereto shall be obligated to consummate
the Merger, unless and until the Agreement, in form and substance acceptable to
the parties, has been duly executed by the parties.
Main Event and Classic hereby agree to cooperate with each other so
that a due diligence review of all books, records, business and financial
affairs of the other can be completed prior to the execution of a definitive
agreement. Classic and Main Event agree to hold in confidence any information
obtained from the other that is confidential in nature and, if no transaction is
completed, to return to the other any material containing confidential
information.
14
<PAGE>
[Letterhead of Classic Restaurants International, Inc.]
If the foregoing meets with your approval, kindly so signify by signing
and returning the enclosed duplicated copy of this letter, whereupon this letter
shall continue a non-binding letter of intent between the parties in accordance
with the terms and provisions set forth above.
Very truly yours,
/s/James Robert Shaw
James Robert Shaw, President
Classic Restaurants International, Inc.
AGREED TO:
MAIN EVENT, INC.
/S/CHARLIE GREENER 3/27/97
By Dated
15
<PAGE>
CLASSIC RESTAURANTS INTERNATIONAL, INC.
3500 Parkway Lane
Suite 435
Norcross, Georgia 30092
May 15, 1997
Charles Greener
Main Event, Inc.
12225 Greenville Ave., Suite 532
Dallas, Texas 75243
Dear Charles:
I am writing to confirm our agreement that the Letter of Intent dated
March 13, 1997 between Classic Restaurants International, Inc. and Main Event,
Inc. is hereby amended to extend until [text crossed out] May 23, 1997 [initials
in margin] the date by which a definitive agreement will be executed. All other
terms and conditions of the Letter of Intent shall remain the same, except that
the deadline in paragraph 6 thereof shall also be changed to [text crossed out]
May 23, 1997.
If the foregoing accurately represents our agreement, kindly so signify
by signing and returning the enclosed duplicate copy of this letter.
Very truly yours,
/s/James R. Shaw
James Robert Shaw, President of Classic
Restaurants International, Inc.
AGREED TO:
MAIN EVENT, INC.
/s/Joyce McReynolds
By:___________________
Its: President
Dated: 5-15-97
16
<PAGE>
Exhibit 27
Financial Data Schedule
17
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET, CONSOLIDATED STATEMENTS OF OPERATIONS, CONSOLIDATED
STATEMENTS OF CASH FLOWS, AND THE NOTES THERETO, FOUND ON PAGES 3 THROUGH 6 OF
THE COMPANY'S FORM 10-QSB DATED MARCH 31, 1997.
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1996
<PERIOD-END> MAR-31-1997
<EXCHANGE-RATE> 1
<CASH> 32,866
<SECURITIES> 0
<RECEIVABLES> 22,654
<ALLOWANCES> 0
<INVENTORY> 15,811
<CURRENT-ASSETS> 311,078
<PP&E> 814,747
<DEPRECIATION> 431,758
<TOTAL-ASSETS> 754,188
<CURRENT-LIABILITIES> 447,889
<BONDS> 0
0
450,000
<COMMON> 3,472,745
<OTHER-SE> (3,911,395)
<TOTAL-LIABILITY-AND-EQUITY> 754,188
<SALES> 0
<TOTAL-REVENUES> 1,831,781
<CGS> 0
<TOTAL-COSTS> 1,419,888
<OTHER-EXPENSES> 1,178,530
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 42,162
<INCOME-PRETAX> (909,077)
<INCOME-TAX> 0
<INCOME-CONTINUING> (909,077)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (909,077)
<EPS-PRIMARY> (.26)
<EPS-DILUTED> (.26)
</TABLE>
