6
7
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10Q-SB
Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the three months ended Commission File Number
March 31, 1998 33-48017-A
EXECUTIVE WEALTH MANAGEMENT SERVICES, INC.
(a Florida corporation)
(Exact name of Registrant as specified in its Charter)
Florida 59-2087068
- ------------------------------ ---------------------
State or other jurisdiction of I.R.S. Employer
incorporation or organization Identification Number
2323 Stickney Point Road, Sarasota, Florida 34231
--------------------------------------------------
(Address of principal executive offices, zip code)
Registrant's telephone number, including area code: (941) 921-9700
Securities registered pursuant to Section 12(b) of the Act:
Securities registered pursuant to Section 12(g) of the Act:
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the Registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days. Yes / X /
No / / .
For the three months ended March 31, 1998, the Registrant had revenues
of $672,480.
As of March 31, 1998, the Registrant had 5,000,000 Shares authorized
and 2,615,485 Shares outstanding. The aggregate market value of the
outstanding shares held by non-affiliates, computed by reference to the
price at which the stock was sold is $1,457,992.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Set forth below are the unaudited financial statements reflecting the
Company's financial condition as of March 31, 1998, and the related
statements of operations and shareholders' equity for the three months
ended March 31, 1998 and 1997.
[THE BALANCE OF THIS PAGE INTENTIONALLY LEFT BLANK]
EXECUTIVE WEALTH MANAGEMENT SERVICES, INC.
BALANCE SHEET
March 31, 1998 (Unaudited)
<TABLE>
<CAPTION>
ASSETS
<S> <C>
CURRENT ASSETS
Cash $ 11,922
Accounts receivable from
correspondent brokers 144,418
Accounts receivable from affiliates 2,174
Accounts receivable from others 15,852
Prepaid expenses 17,500
----------
TOTAL CURRENT ASSETS 191,866
==========
INVESTMENTS
Furniture, Fixtures and Equipment -
at cost net of accumulated depreciation 25,711
OTHER ASSETS
Deposits with clearing organizations 40,093
Other deposits 1,934
----------
TOTAL ASSETS $ 259,604
==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 10,615
Commissions payable 133,446
----------
TOTAL CURRENT LIABILITIES 144,061
==========
STOCKHOLDER S EQUITY
Preferred Stock - authorized 750,000
shares of $.01 par value; no shares
issued or outstanding ---
Common Stock - authorized 5,000,000
shares of $.002 par value; issued and
outstanding 2,615,485 shares 5,231
Additional paid-in capital 1,105,639
Additional paid-in capital, warrants 4,410
Retained earnings (999,737)
----------
TOTAL STOCKHOLDERS' EQUITY 115,543
----------
TOTAL LIABILITIES & STOCKHOLDER S EQUITY $ 259,604
==========
</TABLE>
EXECUTIVE WEALTH MANAGEMENT SERVICES, INC.
STATEMENTS OF OPERATION
For The Three Months Ended March 31 (Unaudited)
<TABLE>
<CAPTION>
1998 1997
------------ -----------
<S> <C> <C>
REVENUE
Commissions $566,751 $825,929
Underwriting fees 74,810 10,500
Other income 30,919 30,980
------------ -----------
TOTAL REVENUE 672,480 867,409
EXPENSES
Advertising 156 800
Board of Directors fees 6,000 4,000
Clearing charges 44,695 57,679
Commissions 500,418 669,619
Consulting fees 15,171 12,400
Dues and subscriptions 823 861
Depreciation 2,584 3,031
Insurance 2,036 604
Meetings and seminars --- 29
Miscellaneous 1,926 3,727
Office expenses 6,774 6,188
Regulatory 9,487 2,663
Rent costs 24,816 21,428
Rental Equipment 2,348 2,641
Salaries and Wages 84,443 86,861
Taxes 10,145 10,269
Travel and lodging 6,462 9,727
Utilities 7,589 6,232
----------- -----------
TOTAL OPERATING EXPENSES 725,873 898,759
----------- -----------
OPERATING INCOME/(LOSS) (53,393) (31,350)
------------ -----------
NET INCOME/(LOSS) $(53,393) $(31,350)
============ ===========
NET INCOME/(LOSS) PER SHARE $ (.020) $ (.012)
============ ===========
</TABLE>
EXECUTIVE WEALTH MANAGEMENT SERVICES, INC.
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
For The Three Months Ended March 31 (Unaudited)
<TABLE>
<CAPTION>
Additional
Additional Paid-In Retained
Preferred Common Paid-In Capital Earnings
Stock Stock Capital Warrants (Deficit) Total
--------- ------ ---------- ---------- ----------- -----
<S> <C> <C> <C> <C> <C> <C>
Balance at
January 1, 1997 - $4,983 $ 913,687 $ 4,410 $ (841,105) $ 81,975
Issuance of common stock 85 50,915 51,000
Net loss for the Three
months ended
March 31, 1997 (31,350) ( 31,350)
--------- ------- ---------- ---------- ----------- ---------
Balance at
March 31, 1997 $ - $5,068 $ 964,602 $ 4,410 $ (872,455) $101,625
========= ======= ========== ========== ============ =========
Additional Retained
Preferred Common Paid-In Earnings Stock
Stock Stock Capital (Deficit) Warrants Total
--------- ------ --------- --------- -------- ---------
Balance at
January 1, 1998 $ - $5,231 $1,105,639 $(946,344) $ 4,410 $168,936
Net loss for three
months ended
March 31, 1998 (53,393) (53,393)
--------- ------- ---------- ---------- -------- ---------
Balance at
March 31, 1998 $ - $5,231 $1,105,639 $(999,737) $ 4,410 $115,543
========= ======= ========== ========== ======== ========
</TABLE>
EXECUTIVE WEALTH MANAGEMENT SERVICES, INC.
STATEMENT OF CASH FLOWS
For The Three Months Ended March 31 (Unaudited)
<TABLE>
<CAPTION>
CASH FLOWS FROM OPERATING ACTIVITIES: 1998 1997
---------- ---------
<S> <C> <C>
Net Income (Loss) $ (53,393) $ (31,350)
Adjustments to reconcile net income
to net cash used in operating activities:
Depreciation 2,584 3,031
(Increase) decrease in operating assets:
Receivable from correspondent brokers (43,144) 8,562
Receivable - other 40,237 (2,078)
Deposits 5,064 (317)
Prepaid expense (2,500) (5,000)
Increase (decrease) in operating liabilities:
Accounts payable 50,092 (9,628)
Commissions payable (114,197) (8,125)
---------- ----------
Net cash provided by (used in)
operating activities (115,257) (44,905)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock --- 51,000
Cash paid for syndication costs --- ---
---------- ----------
Net cash provided by (used in)
financing activities --- 51,000
---------- ----------
NET INCREASE (DECREASE) IN CASH (115,257) 6,095
CASH AT BEGINNING OF PERIOD 127,179 ---
---------- ----------
CASH AT END OF PERIOD $ 11,922 $ 6,095
========== ==========
</TABLE>
EXECUTIVE WEALTH MANAGEMENT SERVICES, INC.
NOTES TO FINANCIAL STATEMENTS
For The Three Months Ended March 31, 1998 and 1997
Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization
Executive Wealth Management Services, Inc., (the Company) is a securities
broker/dealer that transacts business through correspondent brokers and
does not handle any customer securities or funds. Customer security
transactions and related commission revenue and expenses are recorded on
the trade date. The Company also acts as a broker/dealer in selling both
public and private securities offerings on a best efforts basis. In
addition, the Company receives commissions, investment banking and
underwriting fees for its services.
Receivable from Correspondent Brokers
The receivable from correspondent brokers and broker/dealers represent
commissions earned which had not been received at March 31, 1998.
Management has determined that these amounts are fully collectible.
Furniture, Fixtures and Equipment
Furniture, fixtures and equipment are recorded at cost. Depreciation is
provided for in amounts sufficient to relate the cost of assets to
operations over their estimated useful lives using the straight-line
method.
Investments
The Company was issued 55,263 shares of common stock of Flight Sciences,
Inc. This stock was issued to the Company in relation to a private
offering of Flight Sciences' promissory notes. These shares represented 5%
of Flight Sciences, Inc.'s outstanding common stock at the time. The
Company has assigned no value to the stock due to the fact that there is no
ready market and its value is not determinable.
Loss Per Share
Loss per share is computed based upon 2,615,485 and 2,534,000 shares
outstanding during the periods ended March 31, 1998 and 1997, respectively.
Note 2 - DEPOSIT WITH CLEARING ORGANIZATION
Deposits with clearing organizations represent investments in money
markets. The investments are required by the Company's clearing brokers and
are in accordance with the correspondent broker agreement between the
parties. Deposits are reflected at fair market value.
EXECUTIVE WEALTH MANAGEMENT SERVICES, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
For The Three Months March 31, 1998 and 1997
Note 3 - FURNITURE, FIXTURES AND EQUIPMENT
A summary of furniture, fixtures and equipment follows:
<TABLE>
<CAPTION>
March 31, 1998
--------------
<S> <C>
Furniture and fixtures $ 37,951
Equipment 34,202
Leasehold improvements 6,622
----------
78,775
Less: Accumulated
Depreciation (53,064)
----------
$ 25,711
==========
</TABLE>
Note 4 - Operating Leases
Rent expense for the three months ended March 31, 1998 and 1997 was $24,816
and $21,428, respectively.
Note 5 - NET CAPITAL REQUIREMENT
Pursuant to the net capital provisions of Rule 15c3-1 of the Securities and
Exchange Act of 1934, the Company is required to maintain a minimum net
capital of $5,000. In December of 1991, the National Association of
Securities Dealers, Inc. approved the Company as a fully disclosed
broker/dealer. The Company has a restrictive agreement to maintain a net
capital of 130% of the minimum requirement or 6 2/3% of aggregate
indebtedness for each of the three month periods ended March 31, 1998 and
1997.
The Company had net capital of $66,784 or 695% and $40,721 or 376% of the
minimum requirement at March 31, 1998 and 1997, respectively. The net
capital rules may effectively restrict the payment of dividends to the
Company s stockholders. The Company operates pursuant to the (K) (2) (ii)
exemptive provisions of the Securities and Exchange Commissions Rule 15c3-3
and does not hold customers funds or securities.
EXECUTIVE WEALTH MANAGEMENT SERVICES, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
For The Three months Ended March 31, 1998 and 1997
NOTE 6 - INCOME TAXES
At December 31, 1997, the Company had a net operating loss carry forward of
approximately $769,000 that will begin to expire in the year 2009. Due to
the lack of historical operations, management has elected to record a
valuation allowance equal to the deferred tax asset of $280,000, calculated
using an effective income tax rate of 37% for the Company.
NOTE 7 - RELATED PARTY TRANSACTIONS
During the three months ended March 31, 1998 and 1997, companies
affiliated with the Company's majority stockholder shared office space with
the Company and paid rent of $2,865 and $5,724, respectively, for the use
of the space.
During the three months ended March 31, 1998 and 1997, the Company paid
rent of approximately $9,000 to the Company's majority stockholder for
leased space.
NOTE 8 - COMMON STOCK TRANSACTIONS
During the first quarter of 1997, the majority shareholder purchased 42,500
shares of common stock at $1.20 per share.
[REMAINDER OF PAGE LEFT BLANK INTENTIONALLY]
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operation.
Current Operations
The table set forth below reflects the source of revenue earned by the
Company during the six months ended June 30, 1998 and 1997.
<TABLE>
<CAPTION>
1998 1997 Increase/
(Decrease)
---------- ---------- ----------
<S> <C> <C> <C>
Source of Revenue Earned
Commission:
Proprietary Products $ 74,810 $ 10,500 $ 64,310
Transactional 298,918 410,403 (111,485)
Mutual Fund Sales 154,870 138,249 16,621
Insurance/Annuity 110,743 218,039 (107,296)
Limited Partnership Income 2,219 59,237 (57,018)
--------- --------- -----------
Total Commissions 641,560 836,428 (194,868)
Other:
RIA 18,882 9,687 9,195
Miscellaneous 12,038 21,294 (9,256)
--------- --------- -----------
Total $672,480 $ 867,409 $(194,929)
========= ========= ===========
</TABLE>
The Company received commissions and underwriting fees of $74,810 and
$10,500 from the sale of proprietary products or commissions which were "in
house" in character for the three months ended March 31, 1998 and 1997,
respectively. The increase of $64,310 is attributable to the fact that the
Company began a best efforts public offering of $5,000,000 in promissory
notes in Federal Mortgage Management II, Inc. in July of fiscal 1997. As
of March 31, 1998, the Company had placed $2,242,500 principal balance of
the notes. Of that amount, during the fiscal quarter ended March 31, 1998,
the Company placed $710,000 principal balance of the notes.
Transactional revenues, decreased by $111,485 or 27.17% for the three
months ended March 31, 1998, as compared to the same period in 1997. This
decrease is due to the fact that during the fourth quarter of 1997, one of
the Altamonte Springs branch offices moved to become their own
broker/dealer. Also contributing to this decrease were general market and
seasonal conditions. However, the Company believes that with the Delray
Beach, Florida office, the New York office and several prospective
registered persons and other NASD broker/dealer branch offices with which
the Company is in negotiations, this decrease in transactional revenue will
be offset. This overall decrease in transactional revenues was expected,
and is expected to continue through the second fiscal quarter of 1998.
Mutual fund revenue increased approximately $16,621 or 12% for the three
months ended March 31, 1998 as compared to the same period ended 1997.
Limited partnership revenue decreased $57,018 or 96.25% from the three
months ended March 31, 1997 compared to the same period ended 1998.
The decreases in limited partnership revenue and insurance/annuity revenue
of $164,314 have for the most part been offset with an increase in
proprietary product revenue and mutual fund revenue. Mutual fund revenue
increased $16,621 or 12% and proprietary product revenue increased $64,310
or 612.48% for the three month period ended March 31,1998 as compared to
the same period ended 1997.
Overall, total revenue decreased $194,929 or 22.47% for the three months
ended March 31, 1998 as compared to the same period ended 1997.
The Company has a diverse base of registered representatives ranging from
transaction oriented brokers to primarily insurance and mutual fund
salespersons. Transactional revenue was approximately 40% of total
revenue, compared to 47% as of March 31, 1997. This decrease is
attributable to, among other things, the loss of an Altamonte Springs
office as well as to the Company's focused effort in the insurance
marketing, proprietary products, education and recruiting and the Affinity
Group marketing efforts of the business.
As a result of a decrease in overall revenue, expenses overall decreased as
well. The table set fourth below reflects the expense categories of the
Company in which there was a significant increase or decrease for the three
months ended March 31, 1998, as compared to the same period in 1997:
<TABLE>
<CAPTION>
Increase/
Expense Category 1998 1997 (decrease)
---------------- ---------- ---------- ----------
<S> <C> <C> <C>
Board of directors fee $ 6,000 $ 4,000 $ 2,000
Commissions 500,418 669,619 (169,201)
Clearing Charges 44,695 57,679 (12,984)
Consulting 15,171 12,400 2,771
Insurance 2,036 604 2,432
Occupancy 24,816 21,428 3,388
Office Expense 6,774 6,188 586
Regulatory 9,487 2,663 6,824
Salaries & Wages 84,443 86,861 (2,418)
Travel & lodging 6,462 9,727 (3,265)
Utilities 7,589 6,232 1,357
</TABLE>
Commission expense decreased from $669,619 for the three months ended March
31, 1997, to $500,418 for the three months ended March 31, 1998. The
decrease in commissions expense is directly related to the aforementioned
decrease in revenues.
Clearing charges decreased $12,984 or 27.51% for the period ended March 31,
1998, as compared to the same period ended 1997. Clearing charges directly
and proportionately relate to the level of transactional revenues, hence,
generally an increase or decrease in transactional revenues will have the
same effect on charges.
Consulting fees increased 2,771 for the three months ended March 31, 1998,
as compared to the same period in 1997. This increase relates to the fact
that during 1997, the Company entered into a contract with a board member,
Dr. Robert E. Windom. Dr. Windom is compensated $2,000 per month to expand
the marketing and servicing of medical Affinity Groups.
Insurance expense increased $2,432 for the three month period ended March
31, 1998, as compared to the same period ended 1997. This increase is due
to the increases in the property insurance at the Sarasota offices and the
number of employees covered by the Company s worker s compensation
insurance policy.
Occupancy costs increased $3,388 for the three month period ended March 31,
1998, as compared to the same period ended 1997. Such increase is
consistent with the annual adjustment of rent based on the consumer price
index with a cap of 4% in any 12 month period.
Office expense increased $586 or 9.47% for the three months ended March 31,
1998, as compared to the three months ended March 31, 1997. Such increase
is within the normal course of business.
Regulatory expenses increased $6,824 or 256% for the three month period
ended March 31, 1998 as compared to the same period ended 1997. This
increase relates to an increase in the NASD annual assessment. The annual
assessment is based on the prior year s total revenue and the increase in
the number of states in which the firm is registered to do business. Total
revenue for the year ended December 31, 1997 was $4,305,508, compared to
$3,236,058 for the same fiscal year period ended 1996.
Salaries and wages decreased for the three month period ended March 31,
1998, as compared to the same period in 1997 by $2,418. This decrease
relates to a decrease in the number of employees and the overall limit on
salary and wage increases for employees of the Company.
Travel and lodging decreased $3,265 to $6,462 for the three month period
ended March 31, 1998, compared to $9,727 for the same period ended 1997.
The decrease relates to the stringent expense budget efforts on the part of
management.
Future Operations
As of March 31, 1998, Executive had approximately 66 registered
representatives and is in the process of recruiting several new office
locations.
In 1998 management will continue to focus on several growth and expansion
related initiatives. These initiatives will include, but are not limited
to the following:
- Expanded service and marketing to "Affinity Groups",
- Possible secondary public offering and capitalization,
- Continued branch development and expansion,
- Registered investment advisory activities
- Increased investment banking activities,
The Company and its management continue to pursue the addition of new
offices and new registered representatives to existing offices. Management
is currently in negotiations with a prospective office in Florida, as well
as several representatives for its home office location.
In addition, on October 6, 1997, Executive entered into an agreement with
Sun Insurance Marketing Network, Inc. ( Sun ) whereby Sun, which is the
national marketing agent for AIG Life Companies, Inc. s ( AIG ) Long Term
Care Insurance Marketing Program, has agreed to refer and recruit Series 6
and Series 7 securities licensed insurance agents to Executive and to
encourage said agents to contract with the Company to place their variable
life, variable annuity and mutual fund business. Management believes it
can recruit a significant number of these agent/brokers during fiscal 1998.
For approximately two and one half years, the Company has aggressively
engaged in, and committed significant financial and personnel resources to
an extensive market study and analysis of the viability of marketing, on an
exclusive and endorsed basis, various insurance, financial and securities-
related products, and other services to members of large medical affinity
groups and associations. In this regard, Executive has established
contacts and relationships with various medical associations and affinity
groups and has presented comprehensive marketing proposals to specific
groups. The Company will continue to develop these relationships along
with attempting to establish additional relationships with new groups
throughout 1998.
As of March 13, 1997, the Company had entered into a Letter of Intent with
American Healthcare Alliance ("AHA"), the largest nationwide network of
Preferred Provider Managed Healthcare Systems and Organizations, whereby
the parties agreed to undertake a formal contractual relationship in which
Executive will engage in the marketing, on an endorsed basis, of designated
financial services and products as well as other services to physician and
healthcare providers who are members of AHA's Preferred Provider
Organizations. In this regard, Executive has obtained an exclusive
marketing agreement with the nation's largest provider of a pre-paid tax
audit defense program to offer their services to AHA's 180,000 plus
physician members on an endorsed basis. The marketing of this program,
conducted on a direct mail basis, commenced on February 4, 1997. Pursuant
to the terms of the exclusive marketing agreement, the Company receives
first year and renewal commissions on the fees paid by the physician
members for the service.
In August 1997, Executive entered into a Letter of Intent with FLAMEDCO,
Inc. ( FLAMEDCO ), a wholly owned subsidiary of The Florida Medical
Association ( FMA ) concerning Executive marketing a Business Owners Policy
( BOP ) to FMA physician members. Executive is presently working with
Berkley Risk Services of Colorado, Inc. to develop a customized BOP policy
for FLAMEDCO.
In December 1997, Executive made a formal presentation to AMA Solutions,
Inc., a wholly owned subsidiary of the American Medical Association ( AMA )
concerning a pre-paid tax audit defense service to be marketed to AMA
physician members through Executive. AMA Solutions, Inc. has indicated
that final Board of Directors approval should occur in June, 1998 with
marketing of the service to follow soon thereafter.
On March 7, 1998, Executive signed an Agreement and Plan of Merger (
Agreement ) with FAS Group, Inc. whereby Executive will merge with a
subsidiary of GAS Group, Inc. with Executive to be the surviving
corporation. The name of the surviving corporation will be FAS Wealth
Management Services, Inc. Pursuant to the terms of the Agreement, FAS
Group, Inc., the parent corporation, is required to provide capitalization
in the sum of $4,500,000 in marketable securities and $500,000 cash in
exchange for 67 percent ownership interest in FAS Group, Inc. In addition,
FAS Group, Inc. shall also be required, pursuant to the terms of the
Agreement, to obtain a listing of its Common Stock on the NASDAQ Small Cap
Exchange.
The effective date of the merger has been set for June 30, 1998, which date
can be extended to December 31, 1998 if certain conditions of the merger
have not been satisfied by the June 30, 1998 date.
Regulatory Net Capital
As a securities broker-dealer, the Company is subject to the net capital
rules of the United States Securities and Exchange Commission and similar
rules in force in the states where the Company is registered as a
securities broker-dealer. The aggregate indebtedness of a securities
broker-dealer in relation to its net capital is also subject to Commission
rules. Such rules are somewhat complex in the manner that regulatory net
capital is computed. In summary, however, the computation of regulatory
net capital relates to the stockholder's equity of the Company taking into
account deductions from such stockholder's equity which relate to non-
allowable assets which are a non-liquid type and reductions in the market
value of investment securities owned by the Company in accordance with rule-
prescribed "haircuts". Under the rules, the aggregate indebtedness of the
Company in relation to its net capital may not exceed a ration of 15 to 1.
The table set forth below, with respect to the Company, the amount of
regulatory net capital and the amount of aggregate indebtedness and the
ratio thereof to such regulatory net capital as of March 31, 1998 and 1997:
<TABLE>
<CAPTION>
1998 1997
------- --------
<S> <C> <C>
Net Capital $ 66,784 $ 40,721
Aggregate Indebtedness 144,061 162,297
Ratio of aggregate
indebtedness to
net capital 2.16 to 1 3.99 to 1
The National Association of Securities Dealers, Inc. (the "NASD") requires
certain members, such as the Company, to maintain net capital equal to the
greater of 130% of the Commission's net capital requirement or 6 2/3% of
aggregate indebtedness.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
Not Applicable
Item 2. Changes in Securities.
Not Applicable
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
Item 6. Exhibits and Reports on Form 8-K.
Not Applicable
[THE BALANCE OF THIS PAGE INTENTIONALLY LEFT BLANK]
In accordance with the requirements of the Exchange Act, the
registrant causes this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
EXECUTIVE WEALTH MANAGEMENT
SERVICES, INC.
May 12, 1998
BY Guy S. Della Penna
------------------------------------
Guy S. Della Penna, President and
Chief Executive Officer
May 12, 1998 BY Bonnie S. Gilmore
------------------------------------
Bonnie S. Gilmore, Senior Vice President
Chief Financial Officer and Secretary
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 11,922
<SECURITIES> 40,093
<RECEIVABLES> 181,878
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 233,893
<PP&E> 78,775
<DEPRECIATION> (53,064)
<TOTAL-ASSETS> 259,604
<CURRENT-LIABILITIES> 144,061
<BONDS> 0
0
0
<COMMON> 5,231
<OTHER-SE> 110,312
<TOTAL-LIABILITY-AND-EQUITY> 259,604
<SALES> 0
<TOTAL-REVENUES> 672,480
<CGS> 0
<TOTAL-COSTS> 725,873
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (53,393)
<INCOME-TAX> 0
<INCOME-CONTINUING> (53,393)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (53,393)
<EPS-PRIMARY> (.020)
<EPS-DILUTED> (.020)
</TABLE>
