<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[x] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended March 31, 1997.
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from to .
---------- ---------
Commission File Number 0-20944
Jones Programming Partners 2-A, Ltd.
- -------------------------------------------------------------------------------
Exact name of registrant as specified in charter
Colorado #84-1088819
- --------------------------------------------------------------------------------
State of organization I.R.S. employer I.D.#
9697 East Mineral Avenue, P.O. Box 3309, Englewood, Colorado 80155-3309
------------------------------------------------------------------------
Address of principal executive office
(303) 792-3111
----------------------------------
Registrant's telephone number
Indicate by check mark whether the registrant (l) has filed all reports required
to be filed by Section l3 or l5(d) of the Securities Exchange Act of l934 during
the preceding l2 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
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JONES PROGRAMMING PARTNERS 2-A, LTD.
------------------------------------
(A Limited Partnership)
-----------------------
INDEX
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Page
Number
------
PART I. FINANCIAL INFORMATION
<TABLE>
<CAPTION>
Item 1. Financial Statements
<S> <C>
Unaudited Statements of Financial Position as of
March 31, 1997 and December 31, 1996 3
Unaudited Statements of Operations for the
Three Months Ended March 31, 1997 and 1996 4
Unaudited Statements of Cash Flows for the
Three Months Ended March 31, 1997 and 1996 5
Notes to Unaudited Financial Statements as of
March 31, 1997 6-7
</TABLE>
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8-11
PART II. OTHER INFORMATION 12
2
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JONES PROGRAMMING PARTNERS 2-A, LTD.
------------------------------------
(A Limited Partnership)
-----------------------
UNAUDITED STATEMENTS OF FINANCIAL POSITION
------------------------------------------
<TABLE>
<CAPTION>
March 31, December 31,
ASSETS 1997 1996
------ ------------ -------------
<S> <C> <C>
CASH AND CASH EQUIVALENTS $ 447,829 $ 537,638
ACCOUNTS RECEIVABLE 56,469 76,090
INVESTMENT IN AND ADVANCES FOR FILM PRODUCTION,
net of accumulated amortization of $3,471,856 and $3,466,616 as of
March 31, 1997 and December 31, 1996, respectively (Note 3) 559,395 564,635
NOTE RECEIVABLE FROM GENERAL PARTNER,
net of unamortized discount of $3,801 and $14,207 as of
March 31, 1997 and December 31, 1996, respectively 385,365 374,959
OTHER ASSETS 1,726 2,285
----------- -----------
Total assets $ 1,450,784 $ 1,555,607
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
-------------------------------------------
LIABILITIES:
Accounts payable to affiliates $ 56,182 $ 29,106
Accrued distributions to partners 141,781 141,781
Accrued liabilities 23,975 7,705
----------- -----------
Total liabilities 221,938 178,592
----------- -----------
PARTNERS' CAPITAL (DEFICIT):
General partner-
Contributed capital 1,000 1,000
Distributions (26,177) (24,759)
Accumulated deficit (9,784) (9,720)
----------- -----------
Total general partner's deficit (34,961) (33,479)
----------- -----------
Limited partners -
Contributed capital, net of offering costs (11,229 units outstanding
as of March 31, 1997 and December 31, 1996) 4,823,980 4,823,980
Distributions (2,591,513) (2,451,150)
Accumulated deficit (968,660) (962,336)
----------- -----------
Total limited partners' capital 1,263,807 1,410,494
----------- -----------
Total partners' capital 1,228,846 1,377,015
----------- -----------
Total liabilities and partners' capital $ 1,450,784 $ 1,555,607
=========== ===========
</TABLE>
The accompanying notes to the unaudited financial statements
are an integral part of these unaudited financial statements.
3
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JONES PROGRAMMING PARTNERS 2-A, LTD.
------------------------------------
(A Limited Partnership)
-----------------------
UNAUDITED STATEMENTS OF OPERATIONS
----------------------------------
<TABLE>
<CAPTION>
For the Three Months Ended
March 31,
--------------------------
1997 1996
-------- --------
<S> <C> <C>
GROSS REVENUES $ 5,661 $ -
COSTS AND EXPENSES:
Costs of filmed entertainment 5,240 -
Distribution fees and expenses 2,453 -
Operating, general and administrative expenses 20,574 8,960
-------- --------
Total costs and expenses 28,267 8,960
-------- --------
OPERATING LOSS (22,606) (8,960)
-------- --------
OTHER INCOME (EXPENSE):
Interest income 16,218 26,275
-------- --------
Other income, net 16,218 26,275
-------- --------
NET INCOME (LOSS) $ (6,388) $ 17,315
======== ========
ALLOCATION OF NET INCOME (LOSS):
General Partner $ (64) $ 173
======== ========
Limited Partners $ (6,324) $ 17,142
======== ========
NET INCOME (LOSS) PER LIMITED PARTNERSHIP UNIT $ (.56) $ 1.53
======== ========
WEIGHTED AVERAGE NUMBER OF LIMITED
PARTNERSHIP UNITS OUTSTANDING 11,299 11,299
======== ========
</TABLE>
The accompanying notes to the unaudited financial statements
are an integral part of these unaudited financial statements.
4
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JONES PROGRAMMING PARTNERS 2-A, LTD.
------------------------------------
(A Limited Partnership)
-----------------------
UNAUDITED STATEMENTS OF CASH FLOWS
----------------------------------
<TABLE>
<CAPTION>
For the Three Months Ended
March 31,
----------------------------
1997 1996
------------- -------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (6,388) $ 17,315
Adjustments to reconcile net income (loss) to net
cash provided by (used in) operating activities:
Amortization of filmed entertainment costs 5,240 -
Amortization of discount (10,406) (22,464)
Net change in assets and liabilities:
Decrease in accounts receivable 19,621 8,424
Decrease in other assets 559 1,666
Increase in accrued liabilities 16,270 1,500
Increase in accounts payable to affiliates 27,076 348
--------- ---------
Net cash provided by operating activities 51,972 6,789
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions to partners (141,781) (141,781)
--------- ---------
Net cash used in financing activities (141,781) (141,781)
--------- ---------
DECREASE IN CASH AND CASH EQUIVALENTS (89,809) (134,992)
CASH AND CASH EQUIVALENTS, beginning of period 537,638 377,368
--------- ---------
CASH AND CASH EQUIVALENTS, end of period $ 447,829 $ 242,376
========= =========
</TABLE>
The accompanying notes to the unaudited financial statements
are an integral part of these unaudited financial statements.
5
<PAGE>
JONES PROGRAMMING PARTNERS 2-A, LTD.
------------------------------------
(A Limited Partnership)
-----------------------
NOTES TO UNAUDITED FINANCIAL STATEMENTS
---------------------------------------
(1) BASIS OF PRESENTATION
---------------------
This Form 10-Q is being filed in conformity with the SEC requirements for
unaudited financial statements and does not contain all of the necessary
footnote disclosures required for a fair presentation of the Statements of
Financial Position and Statements of Operations and Cash Flows in
conformity with generally accepted accounting principles. However, in the
opinion of management, this data includes all adjustments, consisting only
of normal recurring accruals, necessary to present fairly the financial
position of Jones Programming Partners 2-A, Ltd. (the "Partnership") as of
March 31, 1997 and December 31, 1996 and its results of operations and its
cash flows for the three month periods ended March 31, 1997 and 1996.
Results of operations for these periods are not necessarily indicative of
results to be expected for the full year.
(2) TRANSACTIONS WITH AFFILIATED ENTITIES
-------------------------------------
The General Partner is entitled to reimbursement from the Partnership for
its direct and indirect expenses allocable to the operations of the
Partnership, which shall include, but not be limited to, rent, supplies,
telephone, travel, legal expenses, accounting expenses, preparation and
distribution of reports to investors and salaries of any full or part-time
employees. Because the indirect expenses incurred by the General Partner on
behalf of the Partnership are immaterial, the General Partner generally
does not charge indirect expenses to the Partnership. The General Partner
charged $13,664 and $6,429 to the Partnership for direct expenses for the
three months ended March 31, 1997 and 1996, respectively.
(3) INVESTMENT IN AND ADVANCES FOR FILM PRODUCTION
----------------------------------------------
"Charlton Heston Presents: The Bible"
-----------------------------------
In May 1992, the General Partner, on behalf of the Partnership, entered
into an agreement with Agamemnon Films, an unaffiliated party, to produce
four one-hour programs for television, entitled "Charlton Heston Presents:
The Bible" (the "Bible Programs"). The production costs of the Bible
Programs were approximately $2,370,000, which included a $240,000
production and overhead fee paid to the General Partner. In return for
agreeing to fund these production costs, the Partnership acquired all
rights to the Bible Programs in all markets and in all media in perpetuity.
The Partnership subsequently assigned half of its ownership of the Bible
Programs to an unaffiliated party for an investment of $1,000,000 toward
the production costs for the Bible Programs. After consideration of the
reimbursement, the Partnership's total investment in the Bible Programs is
$1,369,764 and its net investment, after consideration of amortization, was
$182,470 as of March 31, 1997. From inception to March 31, 1997, the
Partnership had recognized $1,300,181 of gross revenue from this film, of
which $534,049 has been retained by the distributors of the film for their
fees and marketing costs and $710,444 has been received by the Partnership
as of March 31, 1997. Of the remaining $55,688, $53,260 was received in
April 1997 and $2,428 was received in May 1997. The Partnership plans to
recover its remaining investment in this film from net revenues generated
from domestic and international home video markets.
"The Whipping Boy"
----------------
In August 1993, the Partnership acquired the film rights to the Newbury
Award-winning book "The Whipping Boy." "The Whipping Boy" was produced as a
two hour telefilm which premiered in the North American television market
on The Disney Channel. The film's final cost was approximately $4,100,000.
As of March 31, 1997, the Partnership had invested $2,661,487 in the film,
which included a $468,000 production and overhead fee paid to the General
Partner. The film was co-produced by the General Partner and Gemini Films,
a German company. The completed picture was delivered to The Disney Channel
in the second quarter of 1994. The Partnership's net investment in the
film, after consideration of amortization, was $376,925 as of March 31,
1997. From inception to March 31, 1997, the Partnership has recognized
$2,242,247 of gross revenue from this film, of which $2,100,000 represents
the initial license fee from The Disney Channel that was used to finance
the film's
6
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production. Of the remaining $142,247, $8,350 has been retained by the
distributors of the film for their fees and marketing costs and $133,116
has been received by the Partnership as of March 31, 1997. The remaining
$781 was received by the Partnership in May 1997. The Partnership plans to
recover its remaining investment in this film from net revenues generated
from domestic and international home video and television markets.
7
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JONES PROGRAMMING PARTNERS 2-A, LTD.
------------------------------------
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
---------------------------------------
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
FINANCIAL CONDITION
-------------------
Liquidity and Capital Resources
- -------------------------------
The Partnership's principal sources of liquidity are cash on hand, amounts to be
received from the General Partner in payment of the promissory notes discussed
below and amounts received from the domestic and international distribution of
its programming. As of March 31, 1997, the Partnership had $447,829 in cash.
It is not anticipated that the Partnership will invest in any additional
programming projects, but instead will focus on the distribution of its existing
programming projects. The Partnership had outstanding amounts receivable
totaling $56,469 as of March 31, 1997. Of these amounts, $53,260 were received
by the Partnership in April 1997 and $3,209 were received in May 1997.
On June 30, 1995, the Partnership sold its interest in the film "Household
Saints" to the General Partner for $1,389,166. The purchase price was paid
$500,000 in cash at closing, $500,000 in the form of a non-interest bearing
promissory note which was paid in full on June 30, 1996 and $389,166 in the form
of a non-interest bearing promissory note payable on June 30, 1997. The sale
proceeds from "Household Saints" will contribute to the liquidity and capital
resources of the Partnership, helping to enable the Partnership to fund its
operating needs and distributions to the limited partners through 1997.
For the three months ended March 31, 1997, the Partnership declared
distributions to partners totaling $141,781, which will be paid in May 1997.
These distributions will be made using cash on hand, interest income, proceeds
received from the sale of "Household Saints" and cash provided by operating
activities. Distributions are expected to continue through 1997, although no
determination has been made regarding any specific level of distributions.
The General Partner believes that the Partnership has, and will continue to
have, sufficient liquidity to fund its operations and to meet its obligations.
Cash flow from operating activities will be generated primarily from the
Partnership's programming projects as follows:
"Charlton Heston Presents: The Bible"
------------------------------------
In 1992, the General Partner, on behalf of the Partnership, entered into an
agreement with Agamemnon Films, an unaffiliated party, to produce four one-hour
programs for television, entitled "Charlton Heston Presents: The Bible" (the
"Bible Programs") for Arts and Entertainment Network ("A&E"). The production
costs of the Bible Programs were approximately $2,370,000, which included a
$240,000 production and overhead fee to the General Partner. In return for
agreeing to fund these production costs, the Partnership acquired all rights to
the Bible Programs in all markets and in all media in perpetuity.
In order to reduce the Partnership's financial exposure, the General Partner, on
behalf of the Partnership, assigned one-half of the Partnership's interest in
the Bible Programs to GoodTimes Home Video Corporation ("GoodTimes"), an
unaffiliated entity directly involved in the specialty home video and
international television distribution business, for an investment by GoodTimes
of $1,000,000. The Partnership and GoodTimes funded Jones Documentary Film
Corporation ("JDFC"), which in turn contracted with Agamemnon Films for the
production of the Bible Programs. JDFC was formed to insulate the Partnership
and GoodTimes from certain risks and potential liabilities associated with the
production of programming in foreign countries because the Bible Programs were
filmed on location in the Holy Lands.
The Partnership and JDFC granted the General Partner the exclusive rights to
distribute the Bible Programs. To accomplish this, the General Partner, on its
own behalf, and GoodTimes entered into an agreement to form J/G Distribution
Company to distribute the Bible Programs. J/G Distribution Company was formed
in June 1992 and the Partnership granted it the sole and exclusive right to
exhibit and distribute, and to license others to exhibit and distribute, the
Bible Programs in all markets, all languages, and all media in perpetuity. J/G
Distribution Company holds the
8
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copyright for the benefit of the Partnership (50 percent interest) and GoodTimes
(50 percent interest). J/G Distribution Company is currently distributing the
Bible Programs in the retail home video market. As of March 31, 1997, gross
sales made by J/G Distribution Company totaled $2,100,195, of which $1,050,098
has been retained by J/G Distribution Company for its fees and marketing costs,
with the remaining $1,050,097 belonging 50 percent to the Partnership and 50
percent to GoodTimes. Additionally, $250,000 was received directly by the
Partnership as its share of the initial license fee from A&E. As of March 31,
1997, the Partnership had received both $469,360 from J/G Distribution and the
$250,000 from A&E. Of the remaining $55,688 due from J/G Distribution, $53,260
was received in April 1997 and $2,428 was received in May 1997.
In 1994, J/G Distribution Company and Jones Interactive, Inc. ("JII"), an
affiliate of the General Partner, entered into an agreement to produce a CD-ROM
version of the Bible Programs. No Partnership funds were utilized in the
production of the CD-ROM version; however, after production costs, distribution
fees and costs associated with distribution are recovered, five percent of net
revenues (as defined in the agreement) will flow to the Partnership. Revenue
proceeds to be received by the Partnership under this agreement, if any, are not
anticipated to be significant. The production was done on two separate discs,
one for the New Testament, which was completed in the third quarter of 1995, and
a second disc for the Old Testament, which was completed in the first quarter of
1996. The CD-ROM version is being distributed in the United States and Canada
by affiliates of J/G Distribution Company.
The Partnership plans to recover its remaining net investment in the Bible
Programs of $182,470 from net revenues generated from domestic and international
home video markets.
"The Whipping Boy"
----------------
In August 1993, the Partnership acquired the film rights to the Newbury Award-
winning book "The Whipping Boy." The project was co-developed by the
Partnership and The Disney Channel and produced by the General Partner and
German and French co-production partners. The completed telefilm was delivered
to The Disney Channel in the second quarter of 1994 and premiered in the North
American television market in July 1994. As of March 31, 1997, the Partnership
had invested $2,661,487 in the film, which included a $468,000 production and
overhead fee payable to the General Partner. The Partnership has received
approximately $2,100,000 from The Disney Channel for licensing certain rights to
the film to The Disney Channel.
The Partnership was responsible for approximately one-half of the $4,100,000
production cost, with the balance of the production budget funded by Gemini
Films and other co-production partners and/or territorial advances from the
film's international distributors. The amount contributed to the production
budget by the Partnership was partially reimbursed by the license advances
totaling $2,100,000 received from the Disney Channel.
Gemini Films will have, in perpetuity, the copyright and all exploitation rights
to the film in German language territories (defined as Germany, Austria, German-
speaking Switzerland and German-speaking Luxembourg). Although these
exploitation rights will remain the sole property of Gemini Films, Gemini Films
will account to the Partnership for any revenue therefrom.
The Partnership will own the worldwide copyright, excluding German language
territories, in perpetuity. Although the Partnership will own all exploitation
rights in all media in North America, which is defined as the United States,
Canada and their respective territories and possessions, the Partnership will
account to Gemini Films for any revenue generated therefrom.
From the movie's North American revenues, the Partnership will first be entitled
to recover its investment plus interest. Thereafter, the Partnership will
receive 90 percent of all North American revenues and Gemini Films will receive
10 percent of such revenues. With respect to international revenues from the
movie's distribution, after Gemini Films recovers $250,000 of its investment in
the movie's production budget, any funded overages and interest out of net
international revenues, the Partnership will receive 20 percent of net
international revenues and Gemini Films will receive 80 percent.
In March 1995, the General Partner, on behalf of the Partnership, entered into
an agreement with an unaffiliated party granting rights to distribute "The
Whipping Boy" in the non-theatrical domestic markets. Non-theatrical markets
include 16mm sales and rentals, in-flight, oil rigs, ships at sea, military
installations, libraries, restaurants, hotels, motels or other
9
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institutional or commercial enterprises. As of March 31, 1997, gross sales made
under this agreement totaled $35,220, of which $8,325 was retained by the
distributor for its fees and $26,895 was received by the Partnership.
In May 1995, the General Partner, on behalf of the Partnership, entered into a
distribution agreement with an unaffiliated party granting rights to distribute
"The Whipping Boy" in the domestic home video market for a period not to exceed
five years. As of March 31, 1997, net sales earned and received by the
Partnership under this agreement totaled $105,522.
The General Partner and Gemini Films selected Canal Plus Distribution as the
company that will distribute and exploit the movie outside of North America.
Canal Plus Distribution will earn distribution fees of 15 percent of the film's
gross receipts outside of North America, and it will be reimbursed for its
expenses capped at 10 percent of the film's gross receipts outside of North
America (excluding dubbing costs). Canal Plus Distribution will be responsible
for accounting and remitting to Gemini Films the net revenues from the film's
distribution in all markets and in all media outside of North America. Gemini
Films will be responsible for forwarding the Partnership's share of such
revenues within 10 days of receipt of such funds from Canal Plus.
During the fourth quarter of 1996, the General Partner reassessed the
anticipated total gross revenue remaining from the distribution of "The Whipping
Boy" in available international and domestic television and home video markets.
Based on revised estimated television and home video sales projections provided
by an independent consultant, a reduction was made to the Partnership's estimate
of total gross revenue to be recognized from the future distribution of the
film. Accordingly, based on the reduced revenue projections for the film, a
determination was made by the General Partner that the Partnership's net
investment in "The Whipping Boy" of $952,731 exceeded the film's estimated net
realizable value of approximately $375,000 as of December 31, 1996. As a
result, a loss from write-down of film production cost of $575,000 was incurred
to reduce the unamortized cost of the film to its estimated net realizable value
as of December 31, 1996. The film's estimated net realizable value was
calculated based on an estimate of anticipated revenues remaining over the life
of the film from international and domestic television and home video
distribution, net of estimated distribution fees and costs, as of December 31,
1996. These revenue projections were estimated based on the film's prior
distribution history, the remaining international and domestic territories
available to the film for future television and home video distribution, and the
General Partner's and the independent consultant's previous distribution
experience with other films.
The Partnership plans to recover its remaining net investment in this film of
$376,925 primarily from net revenues generated from international and domestic
home video and television distribution.
RESULTS OF OPERATIONS
---------------------
Revenues of the Partnership increased $5,661, from $0 to $5,661 for the three
months ended March 31, 1996 and 1997, respectively. This increase was the
result of an overall increase in international and domestic sales of the
Partnership's programming. Revenue from the distribution of the Bible Programs
increased $4,855, from $0 to $4,855 for the three months ended March 31, 1996
and 1997, respectively. In addition, revenue from the distribution of "The
Whipping Boy" increased $806, from $0 to $806 for the three months ended March
31, 1996 and 1997, respectively.
Filmed entertainment costs increased $5,240, from $0 to $5,240 for the three
months ended March 31, 1996 and 1997, respectively. This increase was the
result of increased revenues from the Partnership's programming as discussed
above. Filmed entertainment costs are amortized over the life of the film in
the ratio that current gross revenues bear to anticipated total gross revenues.
Distribution fees and expenses increased $2,453, from $0 to $2,453 for the three
months ended March 31, 1996 and 1997, respectively. This increase was the
result of increased revenues from the Partnership's programming as discussed
above. Distribution fees and expenses relate to the compensation due and costs
incurred by unaffilliated parties in selling the Partnership's programming in
the domestic and international markets. The timing and amount of distribution
fees and expenses vary depending upon the individual market in which programming
is distributed.
Operating, general and administrative expenses increased $11,614, from $8,960 to
$20,574 for the three months ended March 31, 1996 and 1997, respectively. This
increase was due primarily to an increase in consulting fees paid relating to
revenue projections compiled for the Partnership's films as well as increased
direct costs allocable to the operations of the Partnership that were charged to
the Partnership by the General Partner in 1997 as compared to 1996. The
increase in
10
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direct costs allocable to the Partnership's operations resulted mainly from the
increased involvement of General Partner personnel required to properly
administer the second cycle distribution of the Partnership's programming.
Interest income decreased $10,057, from $26,275 to $16,218 for the three months
ended March 31, 1996 and 1997, respectively. This decrease in interest income
was due primarily to a $12,058 decrease in interest income recognized during the
first quarter of 1997 as compared to the similar period in 1996 relating to the
amortization of the discount on the promissory notes received from the General
Partner as part of the June 1995 sale of the film "Household Saints." This
decrease was partially offset by higher levels of invested cash balances in the
three months ended March 31, 1997 as compared to the same period in 1996.
11
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Part II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
a) Exhibits
27) Financial Data Schedule
b) Reports on Form 8-K
None
12
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
JONES PROGRAMMING PARTNERS 2-A, LTD.
BY: JONES ENTERTAINMENT GROUP, LTD.
General Partner
By: /s/ Steven W. Gampp
------------------------------------
Steven W. Gampp
Vice President/Finance and Treasurer
(Principal Financial Officer)
Dated: May 14, 1997
13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 477,829
<SECURITIES> 0
<RECEIVABLES> 56,469
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,450,784
<CURRENT-LIABILITIES> 221,938
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 1,228,846
<TOTAL-LIABILITY-AND-EQUITY> 1,450,784
<SALES> 0
<TOTAL-REVENUES> 5,661
<CGS> 0
<TOTAL-COSTS> 28,267
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (16,218)
<INCOME-PRETAX> (6,388)
<INCOME-TAX> 0
<INCOME-CONTINUING> (6,388)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (6,388)
<EPS-PRIMARY> (.56)
<EPS-DILUTED> (.56)
</TABLE>
