UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the Fiscal Year Ended December 31, 1998
[] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES ACT OF 1934
Commission File No. 33-55254-11
FORLINK SOFTWARE CORPORATION, INC.
(Name of Small Business Issuer in its Charter)
Nevada 87-0438458
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification No.)
organization)
94 Rue de Lausanne, CH1202 Geneva, Switzerland N/A
(Address of principal executive offices) (Zip Code)
Issuer's Telephone number: 41-22-9000000
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered Common Stock
NASDAQ
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (ss.229.405 of this chapter) is not contained herein, and will
not be contained, to the best of registrant=s knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
of any amendment to this Form 10-KSB. [ X ]
Indicate the number of shares outstanding of each of the registrant=s classes of
common stock, as of the latest practicable date.
Class Outstanding as of December 31, 1998
CLASS A COMMON STOCK 5,000,000
DOCUMENTS INCORPORATED BY REFERENCE:
Form 8-K Filed November 24, 1999
Form 8-K Filed January 10, 2000
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PART I
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ITEM 1. DESCRIPTION OF BUSINESS
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(a) Business Development
FORLINK SOFTWARE CORPORATION, INC. (Formerly Light Energy Management,
Inc. and formerly Why Not?, Inc.) (the "Company" or the "Registrant" ) is a
Nevada corporation which was originally incorporated on January 7, 1986 under
the laws of the State of Utah under the name of Why Not?, Inc. and subsequently
reorganized under the laws of Nevada on December 30, 1993. The Company's
reorganization plan was formulated for the purpose of changing the state of
domicile and provided that the Company form a new corporation in Nevada which
acquired all of the contractual obligations, shareholder rights and identity of
the Utah corporation, and then the Utah corporation was dissolved. The Company
is in the developmental stage, and its operations to date have been limited.
In May of 1998, the Company entered into an agreement under the terms
of which it intended to merge with Teknocapital Finance Ltd. Pursuant to that
merger agreement, the shareholders of Teknocapital would exchange 100% of the
issued and outstanding shares of Teknocapital for 4,000,000 of the Company's
common stock. Pursuant to that agreement, the existing Board of Directors of Why
Not?, Inc. resigned. New members were appointed to fill their vacancies and
Teknocapital management assumed responsibility for the Company's affairs.
Thereafter, the merger agreement with Teknocapital was substantially
modified. Specifically, the consideration given for the issuance of the
4,000,000 shares of the Company's common stock was changed from 100% of the
issued and outstanding shares of Teknocapital to
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the execution of promissory notes totaling $ 275,000 payable to the Company by
Harrop & Co. With the execution of these promissory notes, the merger with
Teknocapital was abandoned and the Company continued its activities as an
unfunded venture in search of a suitable business acquisition or business
combination. In November, 1998 the Company's name was changed to Light Energy
Management, Inc. in anticipation of merging with another company. The merger did
not occur, but the Company was unable to register the old name of Why Not?, Inc.
(b) Business of the Issuer
Prior to May of 1998, the Company operated as an unfunded venture. The
Company's operations were funded through loans from officers, directors and
major shareholder in amounts sufficient to enable the Company to satisfy its
reporting and other obligations as a public company, and to commence, on a
limited basis, the process of investigating possible merger and acquisition
candidates.
In May of 1998, the Company entered into an agreement under the terms
of which it intended to merge with a company named Teknocapital Finance, Ltd.
The Company entered into this agreement in hopes of developing a proprietary
internet based business information delivery technology called "Bizzmoz". The
Company intended to market Bizzmoz as an interactive information interface
between a sponsoring business or group and their selected audiences. Soon after
the agreement with Teknocapital in May of 1998, management came to believe that
the Company was more valuable as a vehicle for a business combination with a
line of business other than that proposed by the Teknocapital merger. As a
result, management chose to modify the consideration given for the issuance of
the 4,000,000 shares of the Company's common stock issued in connection with the
Teknocapital transaction. Rather than the acquisition of all of the issued and
outstanding shares of Teknocapital, the consideration for the issuance of these
shares became the execution of promissory notes by the shareholders. Thereafter,
and throughout 1998, the Company once again operated with capital contributions
by management aimed solely at maintaining the Company's reporting status and
attractiveness as a candidate for combination with another business.
The Company does not intend to take any action which would render it an
investment company under The Investment Companies Act of 1940 (the "1940 Act").
The 1940 Act defines an investment company as one which (1) invests, reinvests
or trades in securities as its primary business, (2) issues face amount
certificates of the installment type or (3) invests, reinvests, owns, holds or
trades securities or owns or acquires investment securities having a value
exceeding 40 percent of the value of its total assets (exclusive of Government
securities and cash items) on an unconsolidated basis. The above 40 percent
limitation may be exceeded so long as a company is primarily engaged, directly
or through wholly owned subsidiaries, in a business or businesses other than
that of investing, reinvesting, owning, holding or trading in securities. A
wholly owned subsidiary is defined as one which is at least 95% owned by the
company.
Neither the Company nor any of its officers or directors are registered
as investment advisers under the Investment Advisers Act of 1940 (the "Advisers
Act"), and so there is no
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authority to pursue any course of business or activities which would render the
Company or its management "investment advisers" as defined in the Advisers Act.
Management believes that registration under the Advisers Act is not required and
that certain exemptions are available, including the exemptions for persons who
may render advice to a limited number of other persons and who may advise other
persons located in one state only.
(1) Principal Products and Services and Their Markets
During 1998, the Company's business consisted of its efforts to locate
and evaluate suitable business opportunities in which to engage. During 1999 and
after the reporting period covered by this Form 10-KSB, the Company located such
a business opportunity and has entered into an agreement which will bring a new
line of business to the Company. The Company's new business is described in the
Form 8K the Company filed on November 24, 1999. The narrative of that Form 8-K
is incorporated herein by this reference.
(2) Distribution Methods
During 1998, the Company had no particular products or services and
accordingly had no distribution methods for products or services.
(3) Status of Publicly Announced New Products or Services
On November 24, 1999, the Company filed a Form 8-K under the terms of
which it acquired a new line of business through a corporate reorganization. The
terms of that reorganization were outlined in that Form 8-K filing, the
narrative of which is incorporated herein by this reference.
(4) Competitive Business Conditions
In 1998, the Company did not engage in a business with competitors. The
business acquired by the Company in 1999, the computer software business, is
highly competitive. The Company now faces well funded and experienced
competition. The Company's efforts will be focused on its business in the
Peoples Republic of China where its new management is experienced. Nonetheless,
the Company's status as a start-up corporation may limit its ability to
successfully compete in the extremely competitive computer software markets.
(5) Suppliers
During 1998, the Company did not rely on any principal suppliers as the
Company had no products or services.
(6) Customer Dependence
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During 1998, the Company did not rely on any particular customers for
its continued operations. Indeed, the Company maintained minimal operations
solely so it could evaluate potential business combinations.
(7) Intellectual Property
During 1998, the Company owned no intellectual property.
(9) Effect of Governmental Approval and Regulation
The company is subject to various laws and governmental regulations
applicable to business generally. The Company believes it is in compliance with
such laws and that such laws do not have a material impact on its operations.
(10) Research and Development
The Company has not engaged in any research or development in the last
two years.
(11) Cost of Environmental Regulation
The Company anticipates that it will have no material costs associated
with compliance with either federal, state or local environmental law.
(12) Employees
During 1998, the Company had no full-time or part-time employees. The
Company's operations were conducted by its officers and directors who serve
without compensation.
(c) Subsequent Events
During 1999 and after the reporting period covered by this Form 10-KSB,
the Company entered into a reorganization agreement with a Chinese corporation
named Forlink Software Corporation, Inc. That transaction was reported by the
Company on a Form 8-K filed on November 24, 1999. The narrative of that Form 8-K
is incorporated herein by this reference.
(d) Reports to Security Holders
To the extent that the Company is required to deliver annual reports to
security holders through its status as a reporting company, the Company shall
deliver annual reports. Also, to the extent the Company is required to deliver
annual reports by the rules or regulations of any exchange upon which the
Company's shares are traded, the Company shall deliver annual reports. If the
Company is not required to deliver annual reports, the Company will not go the
expense of producing and delivering such reports. If the Company is required to
deliver annual
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reports, they will contain audited financial statements if audited financial
statements are required.
The public may read and copy any materials the Company files with the
Securities and Exchange Commission at the Commission's Public Reference Room at
450 Fifth Street, N.W., Washington, D.C. 20549. The public may obtain
information on the operation of the Public Reference Room by calling the
Commission at 1-800-SEC-0330. The Commission maintains an Internet site that
contains reports, proxy and information statements, and other information
regarding issuers that file electronically with the Commission. The Internet
address of the Commission's site is (http://www.sec.gov).
(e) Year 2000 Disclosure
The Company does not anticipate any problem in dealing with computer
entries in the year 2000 or thereafter, with any computers currently used at any
of their facilities. All of the Company's computer systems are new and have been
year 2000 compliant from their acquisition. The Company keeps current with all
updates and revisions with all software the Company currently uses. It is
anticipated that the software updates reflect required revisions to accommodate
transactions in the year 2000 and thereafter. Though it is not anticipated that
the Company will have a problem at the turn of the century, the Company intends
to coordinate the resolution of any year 2000 problems with the vendors of the
software the Company utilizes. State of Readiness
The Company does not anticipate any problems in dealing with year 2000
issues. All of the Company's computer systems have been acquired within the last
year and are year 2000 compliant. In this regard, the Company uses computers
(PCs) owned by management. All such systems have computer processors capable of
properly recognizing dates past 1999. The Company's computer systems are used
primarily for word processing, bookkeeping and Internet communications. The
Company keeps current with all updates and revisions of all software used in
connection with the Company's business. The Company's current word processing
accounting and Internet communications software is year 2000 compliant. From an
internal standpoint, the Company is year 2000 ready. Indeed, the Company has
made the year 2000 transition without any problems.
The Company's business may be impacted by the year 2000 readiness of
third parties with whom the Company has a material relationship. Such parties
include banks, telephone companies, attorneys, accountants and transfer agents.
The Company has made inquiry of its transfer agent, Nevada Agency and Trust
Company, its attorneys and its accountant regarding their year 2000 readiness.
All of the Company's attorneys, its accountant and its transfer agent are year
2000 compliant. Larger vendors, such as banks and telecommunications companies,
have represented themselves as year 2000 compliant. However, the Company has
experienced no year 2000 related problems since the turn of the new year.
Costs of Year 2000 Issues
The Company's costs of remediating any year 2000 issues has been
inconsequential. Such costs total no more than a few thousand dollars and have
been borne by the members of the
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Company's management which own the computer systems the Company uses. Indeed,
the general need to upgrade and replace computer systems was more of a factor in
recent computer hardware and software acquisitions than the year 2000 was in
connection with the computer systems the Company uses.
Year 2000 Issues, Risks and Contingency Plans
The most reasonable worst case scenario the Company faces as a result
of year 2000 issues is the failure of third party service providers, such as
banks or telecommunications companies, failing as a result of their failure to
properly remediate any year 2000 problem they may have. If that happens, the
Company will deal with service providers who have not failed to remediate their
year 2000 issues. Management does not anticipate that the costs of changing such
third party service providers will be significant.
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ITEM 2. DESCRIPTION OF PROPERTY
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(1) Principal Plants and Property and Description of Real Estate and
Operating Data.
During 1998, the Company owned no properties and prior to May of 1998
utilized space on a rent-free basis in the office of its principal shareholder,
Capital General Corporation. After May of 1998, the Company had the same
agreement with Harrop & Company, its new principal shareholder, for the use of
office space. This arrangement is expected to continue until such time as the
Company becomes involved in a business venture which necessitates its
relocation. The Company has no agreements with respect to the maintenance or
future acquisition of office facilities, however, it is anticipated that the
office of the Company will be moved now that it has acquired a new line of
business and obtained new management.
(2) Investment Policies
The Company=s plan of operations is focused on the acquisition of
potential business ventures or assets which will provide a source of eventual
profit to the Company described in Item (1) of this part. Accordingly, the
Company has no particular policy regarding each of the following types of
investments:
(1) Investments in real estate or interests in real estate;
(2) Investments in real estate mortgages; or (3) Securities of or
interests in persons primarily engaged in real estate
activities.
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ITEM 3. LEGAL PROCEEDINGS
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On January 7, 1994, the Bureau of Securities of the State of New Jersey
filed a complaint in the matter of Capital General Corporation, David R. Yeaman
(former officer and director of the Company) and 74 other named defendants,
Nevada and Utah corporations including the Company, which complaint proposes
that civil monetary penalties totaling $30,000.00 be assessed against Capital
General Corporation for alleged violations of the Uniform Securities Law (1967),
N.J.S.A. 49:347 et. seq. by (1) selling to 24 New Jersey residents between April
1986 and May 1991, securities in 25 of the 74 above referred to respondent
corporations named in the proceeding, including the Company, which were neither
registered nor exempt from registration, and (2) making untrue statements of
material fact and omitting to state material facts in connection with said New
Jersey sales in 6 of the 74 above referred to resident corporations named in the
proceeding, including the Company. Also on January 7, 1994, the Bureau of
Securities of the State of New Jersey, based on substantially similar
allegations as in the above referred complaint, issued its Order Denying
Exemptions and to Cease and Desist. This order summarily denied the exemptions
contained in N.J.S.A. 49:3 50(b), (1), (2), (3), (9), (11) and (12) of the
securities of Capital General Corporation and the other 74 respondent
corporations, including the Company, except that excluded from the summary
denial of the exemption contained in N.J.S.A. 49350(b)(12) is the Offer of
Rescission by Capital General Corporation to 24 New Jersey residents pursuant to
the offer of rescission which began about April 28, 1993. This order also
ordered Capital General Corporation and David Yeaman to Cease and Desist from
offering or selling any securities in blind pool corporations into, or from the
State of New Jersey.
Capital General and David Yeaman filed answers denying the material
allegations of said complaint and resisting the imposition of said civil
monetary penalties, and the said Order Denying Exemptions and to Cease and
Desist. Subsequently the issues raised in said complaint and order were settled
by agreement between the said Bureau of Securities and Mr. Yeaman and Capital
General Corporation in a consent order dated July 11, 1994 and approved by an
administrative law judge of the State of New Jersey Office of Administrative Law
September 2, 1994. Under the terms of said consent order, all claims in the
complaint against all named respondents were settled by the payment of $3,000
civil penalty, and the order was modified so that it does not apply to 27 of the
respondent companies; however said order does still apply to the Company.
During 1986 and 1987, Capital General gifted very small percentages of
stock (usually 100 shares to each giftee) in the following companies, which
includes the Company, to approximately 1,000 persons or entities: Amenity, Inc.,
Dogmatic, Inc., Mystic Industries, Inc., Highland Mfg., Inc., Kowtow, Inc.,
Noble Industries, Inc., Oryan Capital Corporation, Pegasus Star Enterprise,
Inc., Showstoppers, Inc., Hightide, Inc., Grandeur, Inc., Fantastic Industries,
Inc., Jugglar, Inc., Xebec Galleon, Inc., Golden Home Health Care Equipment
Centers, Inc., Nighthawk Capital, Inc., Instrument Development Corporation,
Panther Industries, Inc., Owl Enterprises, Inc., Quail, Inc., GBS Technologies
Corporation, H & B Carriers Inc., Florida Growth Industries, Inc., Macaw, Inc.,
Longhorn Enterprise, Inc., Koala Corporation, Yahwe Corporation, Star Dolphin,
Inc., Jackal, Inc., Hyena Capital, Inc., Gopher, Inc., Flamingo Capital, Inc.,
Egret, Inc., Cetacean Industries, Inc., Bonito, Inc., Alpaca, Inc., Zeus
Enterprise, Inc., Tamarind, Inc., Saber, Inc., Radar, Inc., Quiescent
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Corporation, Vanadium, Inc., Upsilon, Inc., Why Not?, Inc., Bestmark, Inc., and
Missouri Illinois Mining Co., Inc.
Capital General did not register the gifts of shares in these companies
with the Securities Division of the State of Utah or with the Securities
Exchange Commission because it believed these gifts to be outside the scope of
the Utah Uniform Securities Act and the Securities Act of 1933 in as much as
such acts require registration for sales and do not require registration of
gifts. Nevertheless, in connection with the distribution of shares of its
subsidiaries, Capital General was found by the Utah Securities Advisory Board,
in two decisions affirmed by the Utah State Courts, to have violated the
registration provisions of the Utah Uniform Securities Act. See In re Amenity
Inc., No. SD8611 (Utah Sec. Adv. Bd. February 18, 1987) aff'd C872625 (3d Dist.
Ct. September 18, 1987) aff'd sub nom Capital General Corp. v. Utah Dep't of
Business Reg., 777 P.2d 494, 498 (Utah Ct. App.) cert. denied, 781 P.2d 873
(Utah S.Ct. 1989); In re H&B Carriers Inc., No. 87092801 (Utah Sec. Adv. Bd.,
Apr. 15, 1988) aff'd No. 885900053 (3d Dist. Ct. Sept 10, 1990) aff'd sub nom
Capital General Corp. v. Utah Dep't of Business Reg., Case No 91196 (Utah Ct.
App. February 10, 1992.) All of the remaining companies listed above were
parties to the H&B Carriers order.
Both of these actions sought suspension of transactional exemptions
respecting the shares of these companies pursuant to Section 14 (3) of the Utah
Uniform Securities Act. Capital General defended both actions on the grounds
that the Utah Uniform Securities Act did not apply to gifts of securities, that
the gifts were good faith gifts specifically exempted by the Act, and that in
any event even if it had "sold" shares in violation of the Act, suspension of
transactional exemptions was not an authorized remedy under the statute. These
defenses were rejected at the administrative agency level, and upon judicial
review at the District Court level and by the Utah Court of Appeals.
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ITEM 4. SUBMISSION OF MATTER TO A VOTE OF SECURITY HOLDERS
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The Company did not submit any matter to a vote of the shareholders in
1998.
PART II
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ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDE
MATTERS
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The Common Stock of the Company is currently trading on the Over The
CounterBulletin Board system under the symbol "FRLK". Prior to November of 1999,
the Company traded under the symbol "YNOT".
The following table sets forth the range of high and low bid prices for
the Company's Common Stock for each quarterly period indicated as reported by
the NASDAQ's Historical Research Department.:
Common Stock
Quarter Ended High Bid Low Bid
December 31, 1998 $0.7 $0.875
September 30, 1998 $0.19 $0.22
June 30, 1998 $0.625 $0.875
Holders
On December 31, 1998 there were 5,000,000 shares of the Company's
common stock outstanding.
Dividends
The Company has never paid cash dividends on its Common Stock and does
not intend to do so in the foreseeable future. The Company currently intends to
retain its earnings for the operation and expansion of its business.
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ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION
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Statements contained herein that are not historical facts are
forward-looking statements as that term is defined by the Private Securities
Litigation Reform Act of 1995. Although the Company believes that the
expectations reflected in such forward-looking statements are reasonable, the
forward-looking statements are subject to risks and uncertainties that could
cause actual results to differ from those projected. The Company cautions
investors that any forward- looking statements made by the Company are not
guarantees of future performance and that actual results may differ materially
from those in the forward-looking statements. Such risks and uncertainties
include, without limitation: well established competitors who have substantially
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greater financial resources and longer operating histories, regulatory delays or
denials, ability to compete as a start-up company in a highly competitive
market, and access to sources of capital.
At the end of 1998, the Company had little liquidity and no available
capital resources, such as credit lines, guarantees, etc. and should a merger or
acquisition prove unsuccessful, it is possible that the Company may be dissolved
by the State of Nevada for failing to file reports, at which point the Company
would no longer be a viable corporation under Nevada law and would be unable to
function as a legal entity. Should management decide not to further pursue its
acquisition activities, management may abandon its activities and the shares of
the Company would become worthless. However, the Company's officers, directors
and major shareholder, have made an oral undertaking to make loans to the
Company in amounts sufficient to enable it to satisfy its reporting requirements
and other obligations incumbent on it as a public company, and to commence, on a
limited basis, the process of investigating possible merger and acquisition
candidates. The Company's status as a publicly held corporation may enhance its
ability to locate potential business ventures.
Plan of Operation
During 1998 and throughout 1999, the Company's plan of operation
consisted of locating and evaluating potential merger and acquisition
candidates. Now such a candidate has been found, the Company's future success of
operations will be primarily dependent on new management.
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ITEM 7. FINANCIAL STATEMENTS
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See pages F-1 through F-7.
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ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS O
ACCOUNTING AND FINANCIAL DISCLOSURE.
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There have been no disagreements with the Company's independent
accountants over any item involving the Company's financial statements. The
Company's independent accountant during 1998 was Smith & Company, Certified
Public Accountants, 10 West 100 South, Suite 700, Salt Lake City, Utah 84101-
1554. Subsequent to that time, the Company has selected a new independent
accountant. The details of that selection are described in the Company's Form
8-K filed on January 10, 2000. That 8-K filing is incorporated herein by this
reference.
PART III
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ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND
CONTROL
PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE
ACT
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(a) Directors and Executive Officers
From May of 1998 through November of 1999, the directors and executive
officers of the Company, their ages, positions in the Company, the dates of
their initial election or appointment as director or executive officer, and the
expiration of the terms as directors were as follows:
Name Age Position Period
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Michael J.A. Harrop 53 President and May 1998 to present
a Director
Eric Drizenkow 45 Secretary, Tresurer and May 1998 to present
Director
The Company's directors are elected at the annual meeting of
stockholders and hold office until their successors are elected and qualified.
The Company's officers are appointed annually by the Board of Directors and
serve at the pleasure of the Board.
(b) Business Experience:
Michael J. A. Harrop, age 53, has been President and a Director of the
Company since May 1998. Mr. Harrop was educated at Cambridge University. For the
last 5 years he has been active in venture capital.
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Eric Drizenkow, age 45, has been Secretary, Treasurer and a Director of
the Company since May 1998. Mr. Drizenkow was educated in Roubaix, France. For
the last 5 years he has been an advisor on company constitution to fiduciary
companies in Geneva.
(c) Directors of Other Reporting Companies:
Michael J.A. Harrop is a director of Haas Neuveux & Co.
(d) Employees:
The officers and directors who are identified above are significant
employees of the Company.
(e) Family Relationships:
There are no family relationships between the officers and directors of
the company.
(f) Involvement in Certain Legal Proceedings:
Except as listed below, none of the officers, directors, promoters or
control persons of the Company have been involved in the past five (5) years in
any of the following:
(1) Any bankruptcy petition filed by or against any business of
which such person was a general partner or executive officer
either at the time of the bankruptcy or within two years prior
to that time;
(2) Any conviction in a criminal proceedings or being subject to a
pending criminal proceeding (excluding traffic violations and
other minor offenses); except the following:
On February 8, 1996, David R. Yeaman (former officer and director of
the Company) was charged in the United States District Court for the Eastern
District of Pennsylvania with conspiracy, wire fraud and fraud in the offer,
purchase and sale of securities, in violation of 18 U.S.C. Sections 2, 371 and
1343; 15 U.S.C. Sections 77q(a), 77x, 78j(b), and 78ff; and Rule 10b5
promulgated by the Securities and Exchange Commission, Title 17, Code of Federal
Regulations, Section 240.10b5 (1986). On April 16, 1997, Mr. Yeaman was
convicted of one count of conspiracy, five counts of wire fraud, and three
counts of securities fraud. On January 22, 1998, Mr. Yeaman was sentenced to 14
months imprisonment. He was also fined $20,000.00. Mr. Yeaman began his prison
sentence at FPC Nellis, Las Vegas, Nevada on March 3, 1998. Upon release from
prison, Mr. Yeaman will be on supervised release for a term of three years,
under the terms of which he is required as follows: (1) to not commit another
federal, state or local crime, (2) to refrain from engaging in the securities
and insurance industries, and (3) various other standard conditions of
supervised release.
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The U.S. Securities and Exchange Commission, Securities Act of 1933
Release No. 7008 and Securities Exchange Act of 1934 Release No. 32669 announced
that on July 23, 1993, it ordered David R. Yeaman and Capital General
Corporation to permanently cease and desist from committing or causing further
violations of Section 5(a) and (c) and 17(a) of the Securities Act of 1933 and
Sections 10(b) and 13(g) of the Securities Exchange Act of 1934 and Rules 10b5,
12b20 and 13d1(c) thereunder.
Krista Nielson (a former officer and director of the Company) was
ordered to permanently cease and desist from committing or causing further
violations of Section 17(a) of the Securities Act and Section 10(b) of the
Exchange Act and Rules 10b5 and 12b20 thereunder. In addition, the Commission
ordered the revocation of the registration of the common stock of Altara
International, Inc., Arrow Management, Inc., Atlas Equity, Inc., Dynamic
Associates, Inc., Energy Systems, Inc., Four Star Ranch, Inc., Panorama
Industries, Inc., Partisan Corporation, Quiescent Corporation, Saber, Inc.,
Upsilon, Inc., Vicuna, Inc., Why Not?, Inc., Xebec Galleon, Inc., Zebu, Inc.,
and Zeus Enterprises, Inc. pursuant to Section 12(j) of the Exchange Act. The
Commission found that each of the issuers had filed a registration statement on
Form 10 that contained materially false and misleading statements in violation
of Section 10(b) of the Exchange Act and Rule 10b5 thereunder.
Each of the respondents had submitted an Offer of Settlement consenting
to the entry of the Order without admitting or denying the allegations in the
Order. Prior to the submission of the Offers of Settlement, Capital General, on
behalf of the above mentioned companies, except for Panorama Industries, Inc.,
filed a registration statement on Form S1 during December of 1992 to register
the common stock of those companies under the Securities Act of 1933.
Concurrently with the signing of the Offers of Settlement, the Registration
Statement was declared effective on June 30, 1993. A Post Effective Amendment
was filed and declared effective September 2, 1993. Although the registration of
the common stock under Section 12(g) of the 1934 Act was revoked on July 23,
1993, the companies are now registered and reporting under the Securities Act of
1933 by virtue of the filing of Form S1 as indicated by Commission File No.
3355254.
(3) Being subject to any order, judgment or decree, not
subsequently reversed, suspended or vacated, or any Court of
competent jurisdiction, permanently or temporarily enjoining,
barring, suspending or otherwise limiting his involvement in
any type of business, securities or banking activities (except
as set forth in (2) above); or
(4) Being found by a court of competent jurisdictio (in a civil
action), the Commission or the Commodity Futures Trading
Commission to have violated a federal or state securities laws
or commodities law, and the judgment has not been reversed,
suspended, or vacated (except as set forth in (2) above).
Michael J.A. Harrop, by virtue of the unlimited personal guarantee
accorded by him to Harrop & Cie. S.A., (formerly HF Trade & Finance S.A.) a
Swiss venture capital company that became insolvent subsequent to having acted
as guarantor of certain investments, underwent
-13-
<PAGE>
bankruptcy proceedings during 1994 in the District of Nyon, Switzerland. The
bankruptcy procedure was closed without complaint or suit on 22nd December 1995
by order of the President of the Tribunal of the District of Nyon, Switzerland.
(g) Section 16a Beneficial Ownership Compliance
Together with the filing of this Form 10-KSB, or within a reasoanble
time thereafter, the officers, directors and beneficial owners of more than 5%
of the Company's common stock are filing their initial statements of ownership
on Form 3.
- --------------------------------------------------------------------------------
ITEM 10. EXECUTIVE COMPENSATION
- --------------------------------------------------------------------------------
The Company has not compensated its management in the last three years.
However, the following table sets forth information about compensation paid or
accrued during the years ended December 31, 1998, 1997 and 1996 to the Company's
officers and directors. None of the Company's Executive Officers earned more
than $100,000 during the years ended December 31, 1998, 1997 and 1996.
Summary Compensation Table
<TABLE>
<CAPTION>
LongTerm Compensation
Annual Compensation Awards Payouts
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Other
Annual Restricted Securities All Other
Compen- Stock Underlying LTIP Compen-
Name and Principal Salary Bonus sation Awards Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- -------------------- ----- ------- ------ ------- ---------- ----------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Michael J.A. Harrop 1998 $None $None $None $None None $None $None
President and 1997 $None $None $None $None None $None $None
Director 1996 $None $None $None $None None $None $None
Eric Drizenkow 1998 $None $None $None $None None $None $None
Secretary/Treasurer 1997 $None $None $None $None None $None $None
Director 1996 $None $None $None $None None $None $None
</TABLE>
-14-
<PAGE>
- --------------------------------------------------------------------------------
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
- --------------------------------------------------------------------------------
(a) 5% Shareholders:
The following information sets forth certain information as of December
31, 1998 about each person who is known to the Company to be the beneficial
owner of more than five percent (5%) of the Company's Common Stock:
<TABLE>
<CAPTION>
(1) (2) (3) (4)
Title Name and Address Amount and Nature of Percent of
of Class of Beneficial Owner Beneficial Ownership Class
- -------- ------------------------------------- --------------------- --------------
<S> <C> <C> <C>
Common Capital General Corporation1 481,900 9.6%
3098 So. Highland Drive, Suite 460
Salt Lake City, Utah 84106
Harrop & Co 3,600,000 72%
94 Rue de Lausanne
Geneva SWITZERLAND CH1202
Cede & Co 806,000 16%
P.O. Box 222
Bowling Green Station
New York, New York 10274
</TABLE>
- --------
1 Capital General Corporation is a private corporation. The majority of its
shares (80%) are owned by another private corporation, Yeaman Enterprises, Inc.
The stockholders of Yeaman Enterprises are the adult children of the family of
David Yeaman, who resigned as an officer and director of the Company and
simultaneously resigned as an officer and director of Capital General and Yeaman
Enterprises in April, 1997. Sasha Belliston, Mr. Yeaman's daughter, is the
principal shareholder of Yeaman Enterprises. While Mr. Yeaman has resigned from
his affiliation with the Company, Yeaman Enterprises and Capital General, he may
continue to be deemed an affiliate of the Company by virtue of his familial and
historical relationships with the Company, its shareholders, and its former
officers and directors.
-15-
<PAGE>
(b) Security Ownership of Management:
<TABLE>
<CAPTION>
(1) (2) (3) (4)
Title Name and Address Amount and Nature of Percent of
of Class of Beneficial Owner Beneficial Ownership Class
- -------- ------------------------------------- --------------------- --------------
<S> <C> <C> <C>
Common Michael J.A. Harrop2 3,600,000 72%
94 Rue de Lausanne
Geneva SWITZERLAND CH1202
Common Eric Drizenkow 0 0%
94 Rue de Lausanne
Geneva SWITZERLAND CH1202
All Directors and 3,600,000 72%
Officers as a Group
</TABLE>
(c) Changes in Control:
There is no arrangement which may result in a change in control, except
as diclosed on the Company's Form 8-K filngs during 1999. Such Form 8-K's are
incorporated herein by this reference.
- --------------------------------------------------------------------------------
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
- --------------------------------------------------------------------------------
The Company has entered into a modification agreement with Michael
Harrop, d.b.a. Harrop & Co. under the terms of which the Company agreed to
modify the consideration for the issuance of 4,000,000 shares of the Company's
common stock in May of 1998. Under the terms of this agreement, Mr. Harrop, an
officer and director of the Company, executed a promissory note in favor of the
Company in the amount of $275,000. The note is payable on or before May 1, 2000
and bears interest at the rate of 1 percent per annum.
Other than described above, no officer, director, nominee for election
as a director, or associate of such officer, director or nominee is or has been
in debt to the Company during the last fiscal year. However, the Company's
officers, directors and major shareholder, have made an oral undertaking to make
loans to the Company in amounts sufficient to enable it to satisfy its reporting
requirements and other obligations incumbent on it as a public company, and to
commence, on a limited basis, the process of investigating possible merger and
acquisition candidates. The Company's status as a publiclyheld corporation may
enhance its ability to locate potential business ventures. The loans will be
interest free and are intended to be repaid at a future date, if or when the
Company shall have received sufficient funds through any business acquisition.
The loans are intended to provide for the payment of filing fees, professional
fees, printing and copying fees and other miscellaneous fees.
- --------
2 Mr. Harrop beneficially owns these shares through his controlof Harrop &
Co.
-16-
<PAGE>
- --------------------------------------------------------------------------------
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
- --------------------------------------------------------------------------------
There were no reports filed on Form 8-K during the fourth quarter of
1998.
Assigned
Number Description
- ------ -----------
(2) Plan of acquisition, reorganization, arrangement,liquid, or succession:
Plan of Reorganization filed with the Company's Form 8-K on Novmeber
24, 1999 is incorporated herein by this reference.
(4) Instruments defining the rights of holders including indentures: None
(9) Voting Trust Agreement: None
(10) Material Contracts: Modification Agreement
(11) Statement regarding computation of per share earnings: Computations can
be determined from financial statements.
(13) Annual or quarterly reports, Form 10-Q: None
(16) Letter on change in certifying accountant: None for 1998.
(18) Letter on change in accounting principles: None
(21) Subsidiaries of the registrant: None
(22) Published report regarding matters submitted to vote: None
(23) Consent of reports and counsel:
(24) Power of Attorney: None
(27) Financial Data Schedule: Included
(99) Additional Exhibits: None
-17-
<PAGE>
- --------------------------------------------------------------------------------
SIGNATURES
- --------------------------------------------------------------------------------
In accordance with Section 13 or 15(d) of the Exchange Act, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Dated: January 14, 2000.
FORLINK SOFTWARE CORPORATION, INC.
By
Michael J. A. Harrop
Director
-18-
<PAGE>
Smith
&
Company
A Professional Corporation of Certified Public Accountants
INDEPENDENT AUDITOR'S REPORT
Board of Directors
Forlink Software Corporation Inc.
(A Development Stage Company)
(formerly Why Not?, Inc.)
We have audited the accompanying balance sheets of Forlink Software Corporation
Inc. (a development stage company) as of December 31, 1998 and 1997, and the
related statements of operations, changes in stockholders' equity (deficit), and
cash flows for the years ended December 31, 1998, 1997 and 1996 and for the
period of January 7, 1986 (date of inception) to December 31, 1998. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Forlink Software Corporation
Inc. (a development stage company) as of December 31, 1998 and 1997 and the
results of its operations, changes in stockholders' equity (deficit) and its
cash flows for the years ended December 31, 1998, 1997 and 1996 and for the
period of January 7, 1986 (date of inception) to December 31, 1998 in conformity
with generally accepted accounting principles.
Smith & Company
CERTIFIED PUBLIC ACCOUNTANTS
Salt Lake City, Utah
December 14, 1999
10 West 100 South, Suite 700 o Salt Lake City, Utah 84101-1554
Telephone: (801) 575-8297 o Facsimile: (801) 575-8306
E-mail: [email protected]
Members: American Institute of Certified Public Accountants o
Utah Association of Certified Public Accountants
F-1
<PAGE>
FORLINK SOFTWARE CORPORATION INC.
(A Development Stage Company)
(Formerly Why Not?, Inc.)
BALANCE SHEETS
<TABLE>
<CAPTION>
December 31,
1998 1997
---------------- -----------------
ASSETS
CURRENT ASSETS
<S> <C> <C>
Cash in bank $ 0 $ 0
---------------- -----------------
TOTAL CURRENT ASSETS 0 0
OTHER ASSETS
Organization costs (Note 1) 0 0
---------------- -----------------
0 0
---------------- -----------------
$ 0 $ 0
================ =================
LIABILITIES & EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 630 $ 0
---------------- -----------------
TOTAL CURRENT LIABILITIES 630 0
STOCKHOLDERS' EQUITY (DEFICIT)
Common Stock $.001 par value:
Authorized - 100,000,000 shares
Issued and outstanding 5,000,000 shares
(1,000,000 in 1997) 5,000 1,000
Additional paid-in capital 272,000 1,000
Stock subscription receivable (Note 3) (275,000) 0
Deficit accumulated during the development stage (2,630) (2,000)
---------------- -----------------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) (630) 0
---------------- -----------------
$ 0 $ 0
================ =================
</TABLE>
See Notes to Financial Statements.
F-2
<PAGE>
FORLINK SOFTWARE CORPORATION INC.
(A Development Stage Company)
(Formerly Why Not?, Inc.)
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
1/7/86
(Date of
Years ended December 31, inception) to
1998 1997 1996 12/31/98
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Net sales $ 0 $ 0 $ 0 $ 0
Cost of sales 0 0 0 0
-------------- -------------- -------------- --------------
GROSS PROFIT 0 0 0 0
General & administrative expenses 630 0 0 2,630
-------------- -------------- -------------- --------------
NET LOSS $ (630) $ 0 $ 0 $ (2,630)
============== ============== ============== ==============
Net income (loss) per weighted
average share $ (.00) $ .00 $ .00
============== ============== ==============
Weighted average number of
common shares used to
compute net income (loss)
per weighted average share 3,666,667 1,000,000 1,000,000
============== ============== ==============
</TABLE>
See Notes to Financial Statements.
F-3
<PAGE>
FORLINK SOFTWARE CORPORATION INC.
(A Development Stage Company)
(Formerly Why Not?, Inc.)
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
<TABLE>
<CAPTION>
Deficit
Accumulated
Common Stock Additional Stock During
Par Value $0.001 Paid-in Subscription Development
Shares Amount Capital Receivable Stage
----------------- ------------------ --------------- ----------------- ------------------
Balances at 1/7/86
<S> <C> <C> <C> <C>
(Date of inception) 0 $ 0 $ 0 $ 0 $ 0
Issuance of common stock
(restricted) at $.002 per
share at 1/7/86 1,000,000 1,000 1,000
Net loss for period (1,950)
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/86 1,000,000 1,000 1,000 0 (1,950)
Net loss for year (10)
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/87 1,000,000 1,000 1,000 0 (1,960)
Net loss for year (10)
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/88 1,000,000 1,000 1,000 0 (1,970)
Net loss for year (10)
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/89 1,000,000 1,000 1,000 0 (1,980)
Net loss for year (10)
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/90 1,000,000 1,000 1,000 0 (1,990)
Net loss for year (10)
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/91 1,000,000 1,000 1,000 0 (2,000)
Net income for year 0
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/92 1,000,000 1,000 1,000 0 (2,000)
Net income for year 0
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/93 1,000,000 1,000 1,000 0 (2,000)
Net income for year 0
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/94 1,000,000 1,000 1,000 0 (2,000)
Net income for year 0
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/95 1,000,000 1,000 1,000 0 (2,000)
Net income for year 0
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/96 1,000,000 1,000 1,000 0 (2,000)
Net income for year 0
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/97 1,000,000 1,000 1,000 0 (2,000)
Stock subscription 4,000,000 4,000 271,000 (275,000)
Net loss for year (630)
----------------- ------------------ --------------- ----------------- ------------------
Balances at 12/31/98 5,000,000 $ 5,000 $ 272,000 $ (275,000) $ (2,630)
================= ================== =============== ================= ==================
</TABLE>
See Notes to Financial Statements.
F-4
<PAGE>
FORLINK SOFTWARE CORPORATION INC.
(A Development Stage Company)
(Formerly Why Not?, Inc.)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
1/7/86
(Date of
Years ended December 31, Inception) to
1998 1997 1996 12/31/98
-------------- -------------- -------------- --------------
OPERATING ACTIVITIES
<S> <C> <C> <C> <C>
Net income (loss) $ (630) $ 0 $ 0 $ (2,630)
Adjustments to reconcile net
income (loss) to cash used
by operating activities:
Amortization 0 0 0 50
Change in accounts payable 630 0 0 630
-------------- -------------- -------------- --------------
NET CASH USED BY
OPERATING ACTIVITIES 0 0 0 (1,950)
INVESTING ACTIVITIES
Organization costs 0 0 0 (50)
-------------- -------------- -------------- --------------
NET CASH USED BY
INVESTING ACTIVITIES 0 0 0 (50)
FINANCING ACTIVITIES
Proceeds from sale of
common stock 0 0 0 2,000
-------------- -------------- -------------- --------------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 0 0 0 2,000
-------------- -------------- -------------- --------------
INCREASE IN CASH
AND CASH EQUIVALENTS 0 0 0 0
Cash and cash equivalents
at beginning of year 0 0 0 0
-------------- -------------- -------------- --------------
CASH & CASH EQUIVALENTS
AT END OF YEAR $ 0 $ 0 $ 0 $ 0
============== ============== ============== ==============
</TABLE>
See Notes to Financial Statements.
F-5
<PAGE>
FORLINK SOFTWARE CORPORATION INC.
(A Development Stage Company)
(Formerly Why Not?, Inc.)
NOTES TO FINANCIAL STATEMENTS
December 31, 1998
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
Accounting Methods:
The Company recognizes income and expenses based on the accrual
method of accounting.
Dividend Policy:
The Company has not yet adopted any policy regarding payment of
dividends.
Organization Costs:
The Company amortized its organization costs over a five year
period.
Income Taxes:
The Company records the income tax effect of transactions in the
same year that the transactions enter into the determination of
income, regardless of when the transactions are recognized for
tax purposes. Tax credits are recorded in the year realized.
Since the Company has not yet realized income as of the date of
this report, no provision for income taxes has been made.
In February, 1992, the Financial Accounting Standards Board
adopted Statement of Financial Accounting Standards No. 109,
Accounting for Income Taxes, which supersedes substantially all
existing authoritative literature for accounting for income
taxes and requires deferred tax balances to be adjusted to
reflect the tax rates in effect when those amounts are expected
to become payable or refundable. The Statement was applied in
the Company's financial statements for the fiscal year
commencing January 1, 1993.
At December 31, 1998 a deferred tax asset has not been recorded
due to the Company's lack of operations to provide income to use
the net operating loss carryover of $2,630 which expires as
follows:
Year Ended Expires Amount
December 31, 1986 December 31, 2001 $ 1,950
December 31, 1987 December 31, 2002 10
December 31, 1988 December 31, 2003 10
December 31, 1989 December 31, 2004 10
December 31, 1990 December 31, 2005 10
December 31, 1991 December 31, 2006 10
December 31, 1998 December 31, 2018 630
----------
$ 2,630
==========
NOTE 2: DEVELOPMENT STAGE COMPANY
The Company was incorporated under the laws of the State of Utah
on January 7, 1986 as Why Not?, Inc. and has been in the
development stage since incorporation. On December 30, 1993, the
Company was dissolved as a Utah corporation and reincorporated
as a Nevada corporation. In December, 1998 the name was changed
to Light Energy Management, Inc. and in December, 1999 the name
was changed to Forlink Software Corporation Inc.
NOTE 3: CAPITALIZATION
On the date of incorporation, the Company sold 1,000,000 shares
of its common stock to Capital General Corporation for $2,000
cash for an average consideration of $.002 per share. The
Company's authorized stock includes 100,000,000 shares of common
stock at $.001 par value. On May 1, 1998 4,000,000 shares of
stock were issued to Harrop and Co. in exchange for all of the
outstanding common stock of Teknocapital Finance, Ltd.
("Tekno"). It was the intent that the Company and Tekno would
merge. When Tekno was unable to produce financial records, the
transaction was modified whereby the Company would receive cash
of $275,000 rather than the shares of Tekno. The $275,000 is
reflected in the equity section at December 31, 1998 as the cash
was not received prior to December 31, 1998.
F-6
<PAGE>
FORLINK SOFTWARE CORPORATION INC.
(A Development Stage Company)
(Formerly Why Not?, Inc.)
NOTES TO FINANCIAL STATEMENTS (continued)
December 31, 1998
NOTE 4: RELATED PARTY TRANSACTIONS
The Company neither owns or leases any real property. Office
services thru May 1, 1998 were provided, without charge, by
Capital General Corporation. Such costs are immaterial to the
financial statements, and, accordingly, have not been reflected
therein. The officers and directors of the Company are involved
in other business activities and may, in the future, become
involved in other business opportunities. If a specific business
opportunity becomes available, such persons may face a conflict
in selecting between the Company and their other business
interests. The Company has not formulated a policy for the
resolution of such conflicts.
NOTE 5: SUBSEQUENT EVENTS
On November 3, 1999, the Company entered into a Plan of
Reorganization with Beijing Forlink Software Technology Co. Ltd.
("Beijing"). The Company issued 20,000,000 shares of its
restricted common stock to acquire 100% of the outstanding
common stock of Beijing. After the transaction, the Beijing
shareholders own 80% of the outstanding common stock of the
Company. At the same time, three new directors were elected.
The Company is in the process of obtaining audited financial
statements and pro forma information for Beijing.
F-7
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information
extracted from Forlink Software Corporation Inc. December
31, 1998 financial statements and is qualified in its
entirety by reference to such financial statements
</LEGEND>
<CIK> 0000866458
<NAME> Forlink Software Corporation Inc.
<CURRENCY> US
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> DEC-31-1998
<EXCHANGE-RATE> 1.00
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 630
<BONDS> 0
0
0
<COMMON> 5,000
<OTHER-SE> (5,630)
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 630
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (630)
<INCOME-TAX> 0
<INCOME-CONTINUING> (630)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (630)
<EPS-BASIC> (.00)
<EPS-DILUTED> (.00)
</TABLE>
