<PAGE> 1
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended September 30, 1999
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _______ to _______
Commission File Number 0-23152
@POS.COM, INC.
----------------------------------------------
Exact Name of small business issuer as specified in its charter
DELAWARE 33-0253408
------------------------------- ------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3051 NORTH FIRST STREET, SAN JOSE, CA 95134
------------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: (408) 468-5400
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the issuer was required to file such reports), and (2) has been
subject to filing requirements for the past 90 days. Yes [X] No [ ]
Number of shares of issuer's common stock outstanding as of
October 21, 1999: 2,242,654
Transitional Small Business Disclosure Format: Yes [ ] No [X]
================================================================================
<PAGE> 2
@POS.COM, INC.
FORM 10-QSB
TABLE OF CONTENTS
<TABLE>
<S> <C>
PART I. FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
Consolidated Balance Sheet at September 30, 1999 3
Consolidated Statements of Operations for the
Three Months Ended September 30, 1999 and 1998 4
Consolidated Statements of Cash Flows for the
Three Months Ended September 30, 1999 and 1998 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 14
Signature 14
</TABLE>
2
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PART I: FINANCIAL INFORMATION
ITEM 1: CONSOLIDATED FINANCIAL STATEMENTS
@POS.COM, INC.
CONSOLIDATED BALANCE SHEET (unaudited)
as of September 30, 1999
<TABLE>
<S> <C>
ASSETS
Current assets:
Cash and equivalents $ 1,341,575
Accounts receivable, net 2,418,205
Inventories, net 2,728,823
Prepaid expenses and other current assets 444,204
------------
Total current assets 6,932,807
------------
Property and equipment, net 1,597,043
------------
Total assets $ 8,529,850
============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Capital lease obligations, current 124,433
Notes payable 1,500,000
Bank overdraft 556,191
Accounts payable 1,658,645
Accrued liabilities and other 653,778
------------
Total current liabilities 4,493,047
------------
Capital lease obligations, non-current 571,625
Stockholders' equity:
Series B convertible Preferred Stock 574
Series C convertible Preferred Stock 28
Series D convertible Preferred Stock 1,273
Common stock 2,239
Additional paid-in capital 15,186,549
Accumulated deficit (11,725,485)
------------
Total stockholders' equity 3,465,178
------------
Total liabilities and stockholders' equity $ 8,529,850
============
</TABLE>
The accompanying notes are an integral part of this
consolidated financial statement.
3
<PAGE> 4
@POS.COM, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
<TABLE>
<CAPTION>
1999 1998
----------- -----------
<S> <C> <C>
Revenues $ 2,234,751 $ 6,046,779
Cost of revenues 1,521,771 3,541,410
----------- -----------
Gross margin 712,980 2,505,369
----------- -----------
Operating expenses:
Selling, general and administrative 2,197,825 1,142,774
Research and development 1,792,896 961,005
----------- -----------
Total operating expenses 3,990,721 2,103,779
----------- -----------
Operating income/(loss) (3,277,741) 401,590
Interest expenses (29,256) (20,412)
Interest income 27,423 58,223
----------- -----------
Income/(loss) before income taxes (3,279,574) 439,401
Income taxes -- --
----------- -----------
Net income/(loss) $(3,279,574) $ 439,401
=========== ===========
Net income/(loss) per share (Note 2)
Basic $ (1.55) $ 0.23
Diluted $ (1.55) $ 0.07
Weighted average shares outstanding
Basic 2,120,337 1,906,450
Diluted 2,120,337 6,437,988
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
4
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@POS.COM, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
<TABLE>
<CAPTION>
1999 1998
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net income(loss) $(3,279,574) 439,401
Adjustments to reconcile net income(loss) to
net cash used in operating activities:
Depreciation and amortization 107,893 30,276
Provision for bad debts 22,501 33,109
Issuance of Common Stock Purchase Warrants -- 138,422
Changes in operating assets and liabilities:
Accounts receivable 3,812,408 571,276
Inventories (1,148,429) 635,327
Prepaid expenses and other current assets (221,412) 34,656
Accounts payable (418,469) (1,426,498)
Accrued liabilities (43,964) 63,382
Deferred revenues -- (882,281)
----------- -----------
Net cash used in operating activities (1,169,046) (362,930)
----------- -----------
Cash flows from investing activities:
Purchases of property and equipment (424,503) (55,417)
----------- -----------
Net cash used in investing activities (424,503) (55,417)
----------- -----------
Cash flows from financing activities:
Borrowings - credit line 700,000 --
Repayments - credit line -- (290,195)
Proceeds from issuance of Common Stock 60,270 --
----------- -----------
Net cash provided(used) by financing
activities 760,270 (290,195)
----------- -----------
Net decrease in cash (833,279) (708,542)
Cash and cash equivalents at beginning of period 2,174,854 6,465,898
----------- -----------
Cash and cash equivalents at end of period $ 1,341,575 $ 5,757,356
=========== ===========
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
5
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@POS.COM, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. BASIS OF PRESENTATION
The financial information included herein for the three month period ended
September 30, 1999 and 1998 is unaudited; however, such information reflects all
adjustments consisting only of normal recurring adjustments which are, in the
opinion of management, necessary for a fair presentation of the financial
position, results of operations and cash flows for the interim periods.
The interim consolidated financial statements presented herein have been
prepared in accordance with generally accepted accounting principles for interim
financial information and the instructions to Form 10-QSB. These interim
financial statements should be read in conjunction with the consolidated
financial statements and the notes thereto included in the Form 10-KSB of
@POS.com, Inc. (the "Company") for the year ended June 30, 1999.
The results of operations for the interim periods presented are not necessarily
indicative of the results to be expected for the full year.
2. NET INCOME/(LOSS) PER SHARE
Basic net income per share is computed by dividing net income/(loss) available
to common stockholders (numerator) by the weighted average number of common
shares outstanding (denominator) during the period and excludes the dilutive
effect of stock options and convertible securities. Diluted net income per share
gives effect to all dilutive common shares and other dilutive securities
outstanding during the period, including the assumed conversion of the Preferred
Stock into Common Stock using the if converted method. In computing diluted net
income per share, the average stock price for the period is used in determining
the number of shares assumed to be purchased from the exercise of stock options.
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<PAGE> 7
The following table sets forth the computation of basic and diluted earnings per
share for the three months ended September 30, 1999 and 1998 as follows:
<TABLE>
<CAPTION>
September 30,
1999 1998
----------- -----------
<S> <C> <C>
Numerator for basic and diluted earnings per
share - net income/(loss) $(3,279,574) $ 439,401
----------- -----------
Denominator for basic earnings per share
-- weighted average Common shares 2,120,337 1,906,450
Effect of dilutive securities
Series B Preferred Stock -- 1,456,550
Series C Preferred Stock -- 1,150,307
Series D Preferred Stock -- 1,273,149
Employee stock options and warrants -- 651,532
----------- -----------
Denominator for diluted earnings per
share -- adjusted weighted average
shares 2,120,337 6,437,988
----------- -----------
Income/(loss) per share
Basic $ (1.55) $ 0.23
Diluted $ (1.55) $ 0.07
Potentially dilutive securities excluded
from computations as the effect
would be antidilutive 4,343,066 --
</TABLE>
3. INVENTORIES
Inventories are carried at the lower of cost, as determined on a first-in,
first-out basis, or market. At September 30, 1999, the Company's inventories
were as follows:
<TABLE>
<S> <C>
Finished goods $ 525,049
Work in process 171,039
Raw materials 2,140,498
Inventory reserve (107,763)
-----------
Total $ 2,728,823
-----------
</TABLE>
4. COMPREHENSIVE INCOME (LOSS)
As of July 1, 1998, the Company adopted Statements of Financial Accounting
Standard ("SFAS") No. 130, "Reporting Comprehensive Income"("SFAS No.130"). SFAS
No.130 establishes standards for reporting and display of comprehensive
income(loss) and its components in a full set of general purpose financial
statements. The objective of SFAS No. 130 is to report a measure of all changes
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<PAGE> 8
in equity of an enterprise that results from transactions and other economic
events of the period other than transactions with shareholders. Comprehensive
income(loss) is the total of net income(loss) and all other non-owner changes in
equity. For the quarters ended September 30, 1999 and 1998, the Company's
comprehensive income(loss) was equal to net income(loss) for each of the two
quarters, respectively.
5. SEGMENT INFORMATION
During fiscal 1999, the Company adopted SFAS No. 131, "Disclosures About
Segments of an Enterprise and Related Information." SFAS No. 131 requires a new
basis of determining reportable business segments (i.e., the management
approach). This approach requires that business segment information used by
management to assess performance and manage company resources be the source of
information disclosure. On this basis, the Company is organized and operates as
one business segment, the design, development, manufacture, and marketing of
Point-Of-Sale services and solutions.
During the first quarter ended September 30, 1999, the Company did not generate
significant revenues in foreign countries.
6. RECENT ACCOUNTING PRONOUNCEMENTS
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities," which the Company will be required to adopt
for fiscal year 2000. This statement establishes a new model for accounting for
derivatives and hedging activities. Under SFAS No. 133, all derivatives must be
recognized as assets and liabilities and measured at fair value. The Company
expects that the adoption of SFAS No. 133 will have no impact on the Company's
consolidated financial position or results of operations.
8
<PAGE> 9
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion should be read in conjunction with the accompanying
unaudited consolidated financial statements of @POS.com, Inc. and its wholly
owned subsidiaries, including the notes thereto (see Part I, Item 1).
This quarterly report on Form 10-QSB ("Form 10-QSB") for @POS.com, Inc. (the
"Company") contains forward-looking statements made within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Exchange Act of 1934, as amended. Words such as "anticipates," "expects,"
"intends," "plans," "seeks," "estimates," and similar expressions identify such
forward looking statement. These statements are not guarantees of future
performance and are subject to certain risks and uncertainties that could cause
actual results to differ materially from those expressed or forecasted. Factors
that might cause such a difference include, but are not limited to, those
discussed in the section entitled "Business," "Operating Results," "Liquidity
and Capital Resources," and "Outlook" on pages 3-5 and 7-9 in the annual report
on Form 10-KSB ("Annual Report") filed with the Securities and Exchange
Commission("Commission") on September 30, 1999. Readers should not rely unduly
on forward-looking statements, which reflect only the opinion of the Company's
management as of the date hereof. Unless required by law, the Company undertakes
no obligation to revise forward-looking statements. Readers should also
carefully review the risk factors set forth in other reports or documents the
Company files from time to time with the Commission, particularly the quarterly
reports on Form 10-QSB, and any current reports on Form 8-K.
RESULTS OF OPERATIONS (THREE MONTHS ENDED SEPTEMBER 30, 1999 COMPARED TO THREE
MONTHS ENDED SEPTEMBER 30, 1998)
The 63% decrease in revenues from the first quarter of fiscal 1999 (three months
ended September 30, 1998) to the first quarter of fiscal 2000 (three months
ended September 30, 1999) is largely due to decreased sales of the Company's
advanced PenWare 3100 inter-active electronic transaction terminal. During the
first quarter of fiscal 2000, the Company was transitioning its focus on
web-enabling the Point of Sales ("POS") and its iPOS TC product which was
introduced in the fourth quarter of fiscal 1999. Due to this product transition
and year 2000 issue, certain customers are holding back on purchasing the
PenWare 3100 during the first quarter of fiscal 2000. In addition, the Company
also gave discount to certain shipment to a customer in return for the customer
signing up for the future e-commerce service offering by the Company.
Gross margin for the first quarter of fiscal 2000 was 32%, compared to 41% in
the first quarter of fiscal 1999. The decrease in margin percentage is primary
attributable to higher overhead costs and lowering selling price on certain
contracts where the Company discounted certain shipments to attract customers to
the Company's e-commerce business.
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Selling, general and administrative expenses increased by 92% from first quarter
of fiscal 1999 to the first quarter of fiscal 2000. The increase is largely the
result of higher personnel expenses to support business growth. The Company had
established its channel and product marketing groups in an effect to create
market awareness for it e-commerce business and creation of a brand identity
that is consistent with the change in business strategy. The Company also
increased its spending on trade show participation and public relations
activities. The Company expects that it will continue to make investments in
selling, general and administrative costs.
Research and development expenses rose to $1.8 million in the first quarter of
2000 from $1 million in the first quarter of fiscal 1999, an increase of 87%.
This increase is primarily attributable to increases in headcount, particularly
key engineering talent. Expenses for technology consulting, materials and
non-recurring engineering activities also rose significantly in connection with
the Company's product development and design effort. During the first quarter of
fiscal 2000, the Company started the implementation of certain pilot programs
based on its advanced iPOS TC technology to attract customers to its new
e-commerce offering. Research and development expenses are generally charged to
operations as incurred. In accordance with SFAS 86, the Company capitalizes
software development costs when technological feasibility has been established.
Costs eligible for capitalization during fiscal 1999 and 1998 were
insignificant, and the Company expensed all software development costs to
research and development.
CASH AND SOURCES OF LIQUIDITY
The Company's operating activities consumed $1.17 million in cash during the
first quarter of fiscal 2000, compared to $0.36 million during the first quarter
of fiscal 1999. The increased cash usage in the first quarter of 2000 was due
largely to increased expenses partially offset by collection of the Company's
accounts receivable in the period.
The Company's financing activities generated $0.76 million in the first quarter
of 2000 compared to cash outlay of $0.29 million in the first quarter of fiscal
1999. The increase in cash inflow resulted from the borrowing of $0.7 million
from a line of credit compared to the repayment of $0.29 million indebtedness
under the same line of credit with a commercial bank in the first quarter of
1999. The line of credit has been expired on September 24, 1999 and was
subsequently extended through December 30, 1999. The Company is in violation of
certain covenants under this line of credit and received a waver from the Bank
through the month ending October 31, 1999. The Company is in negotiation with
the Bank to further extend this line of credit. There is no guarantee that the
Company will be successful in extending this line of credit. If the Company
fails to obtain an extension by December 30, 1999, the balance of $1.5 million
borrowings will become due. As of September 30, 1999, the Company's principal
sources of liquidity include cash of $1.3 million. The Company had no other long
or short-term debt and no significant capital commitments other than those under
capital leases totaling $.7 million as of September 30, 1999.
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OUTLOOK
With the cash on hand, the Company believes that it will require additional
financing for fiscal 2000. The Company is pursuing other debt or equity
transactions which upon completion, would provide additional financing for
working capital and future expansion.
There is no assurance that additional funding will be available.
The Company believes that it has the technical and marketing skills and product
offerings necessary for future success. However, the Company has yet to sustain
consistent profitability and sales trends are inherently difficult to predict at
this stage of development. Sales forecast shortfalls, delayed product
introductions, and manufacturing and financing constraints, together with other
risk factors, could lead to adverse fluctuations in revenues and profits in any
particular quarter.
IMPACT OF CURRENCY AND INFLATION.
The Company purchases the majority of its materials and services in U.S.
dollars, and most of its foreign sales are transacted in U.S. dollars. The
Company did not hold or purchase any foreign exchange contracts for the purchase
or sale of foreign currencies. The Company may choose to enter into such
contracts from time to time should conditions appear favorable. Effects of
inflation on Company's financial results have not been significant.
RISK FACTORS AFFECTING THE COMPANY'S BUSINESS, OPERATING RESULTS AND FINANCIAL
CONDITION
In addition to other information in this Form 10-QSB and the risk factors
discussed in the Company's latest Annual Report filed with the Commission,
investors evaluating the Company and its business should carefully consider the
following risk factors, which may have a significant impact on the Company's
business, operating results and financial condition. The risk factors set forth
below and elsewhere in this Form 10-QSB and in the Company's Annual Report could
cause actual results to differ materially from those projected in any
forward-looking statements. These risk factors include but are not limited to
the following;
UNPREDICTABLE AND FLUCTUATING OPERATING RESULTS; The Company has yet to sustain
consistent profitability and sales trends are inherently difficult to predict at
this stage of development. Sales forecast shortfalls, delayed product
introductions, and manufacturing and financing constraints, together with other
risk factors, could lead to adverse fluctuations in revenues and profits in any
particular quarter.
HIGHLY COMPETITIVE MARKETS AND RAPIDLY DEVELOPING AND CHANGING TECHNOLOGIES AND
MARKET CONDITION; The Point-of-Sale device market is constantly changing. These
changes include, among others: rapid technological advances; evolving industry
standards in electronic fund transfer and point-of-sale products; changes in
customer requirements; and frequent new product introductions and enhancements.
The Company may not successfully keep up with the new products and technological
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<PAGE> 12
advances of others. If the Company is not able to develop and market new
products and product enhancements that achieve market acceptance on a timely and
cost effective basis, it could materially and adversely affect the Company's
business, financial condition and results of operations.
DEPENDENCY ON LARGE CUSTOMERS; The Company relies upon large retail customers
with a large number of point-of-sale terminals for a significant percentage of
our revenues. The Company continues to diversify its customer base by developing
strategic alliances and partnerships to open more distribution channels and
limit its reliance on large customers. While the Company continues to transact
business with its current customers and attract new ones, the Company's revenues
will decrease significantly if it loses a large customer. Furthermore, there are
no assurances the Company will be successful in attracting new customers.
CLAIMS OF INFRINGEMENT ON OTHERS' PROPRIETARY RIGHTS; Although the Company
believes that its services and products do not infringe on the intellectual
property rights of others, the Company can not prevent someone else from
asserting a claim against the Company in the future for violating their
technology rights. Third parties making infringement claims may have
significantly greater resources than the Company does to pursue litigation, and
the Company cannot be certain that it would prevail in an infringement action.
The Company received a letter of inquiry from NCR Corporation ("NCR") accusing
the Company of infringing on certain NCR patents. This matter is under
investigation by the Company's legal counsel.
SINGLE COMPONENT MANUFACTURER/SUPPLIERS; the Company depends on other
manufacturers and suppliers for some of its products and certain components used
in our products. The components it obtains from other manufacturers and
suppliers are only available from a limited number of sources. Certain
components and products are currently purchased from single supplier. While the
Company maintains sufficient inventory of certain products and continually
evaluate alternative sources of supply, the failure of any such single supplier
to meet its commitment on schedule could adversely affect the Company.
ABILITY TO ATTRACT AND RETAIN KEY PERSONNEL; the Company's future performance
depends upon the continued service of a number of senior management and key
technical personnel. The loss or interruption of the services of one or more key
employees could have a material adverse effect on our business, financial
condition and results of operations. The Company's future also will depend upon
its ability to attract and retain highly skilled technical, managerial and
marketing personnel. Competition for qualified personnel is significant and
intense, and is likely to intensify in the future. The Company competes for
qualified personnel against numerous companies, including larger, more
established companies with significantly greater financial resources than the
Company's. Significant competition exists for such personnel. If the Company is
unable to hire and retain qualified personnel in the future, it could materially
and adversely affect its business, financial condition and results of operations
12
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YEAR 2000 ISSUE
The Year 2000 issue arises from the fact that most computer software programs
have been written using two digits rather than four to represent a specific
year. Any computer programs that have date-sensitive software may recognize a
date using "00" as the year 1900 rather than the year 2000. This could result in
a system failure or miscalculation causing disruptions of operations, including,
among other things, a temporary inability to process transactions, send invoices
or engage in similar normal business activities. During first quarter of fiscal
2000, the Company continued to review and assess its internal software, data
management, accounting, manufacturing and operational systems to ensure that
they do not malfunction as a result of the Year 2000 date transition. The review
and corrective measures are proceeding in parallel. These reviews and corrective
measures are intended to encompass all significant categories of internal
systems used by the Company. In Addition, the Company is also working with its
significant suppliers to ensure that the products supplied to the Company, and
the products the Company supplies to its customers, are Year 2000-compliant. The
Company has identified all critical systems necessary to the Company's internal
system operations and has asked suppliers to provide assurances that such
systems are Year 2000-compliant, or to identify replacement or upgrade systems.
With respect to Year 2000 compliance of our suppliers' systems, the Company is
in the process of evaluating and assessing the adequacy of responses from its
various suppliers, and requesting further responses and assurances where
appropriate. This process is largely complete and is expected to be fully
completed by the end of calendar 1999. The Company intends to have its Year 2000
assessment, testing, remediation efforts and development of necessary
contingency plans completed by the end of calendar year 1999, the total costs of
which has not yet been determined. To date, however, costs incurred to address
the Year 2000 compliance issues have not been material. Costs related to Year
2000 compliance issues continue to be funded through operating cash flow. The
Company believes that its Year 2000 compliance project will be completed on a
timely basis, and in advance of the Year 2000 date transition, and will not have
a material adverse effect on the Company's financial condition. However, there
can be no assurance that delays or problems, including the failure to ensure
Year 2000 compliance by systems or products supplied to the Company by a third
party, will not have an adverse effect on the Company, its financial performance
or the competitiveness or customer acceptance of its products. Further, the
Company's current understanding of expected costs is subject to change as the
project progresses, and does not include potential costs related to actual
customer claims or the cost of internal software and hardware replaced in the
normal course of business.
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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.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant has
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
@POS.com, INC.
Date: November 15, 1999 By: /s/ DAVID M. LICURSE, SR.
-----------------------------------
David M. Licurse, Sr.
Chief Financial Officer and
Vice President of Operations
(principal accounting officer)
14
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------- -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-2000
<PERIOD-START> JUL-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 1,341,575
<SECURITIES> 0
<RECEIVABLES> 2,525,969
<ALLOWANCES> 107,764
<INVENTORY> 2,728,823
<CURRENT-ASSETS> 6,932,807
<PP&E> 2,267,925
<DEPRECIATION> 670,882
<TOTAL-ASSETS> 8,529,850
<CURRENT-LIABILITIES> 4,493,047
<BONDS> 0
0
1,875
<COMMON> 2,239
<OTHER-SE> 3,461,064
<TOTAL-LIABILITY-AND-EQUITY> 8,529,850
<SALES> 2,234,751
<TOTAL-REVENUES> 2,234,751
<CGS> 1,521,771
<TOTAL-COSTS> 1,521,771
<OTHER-EXPENSES> 3,968,220
<LOSS-PROVISION> 22,501
<INTEREST-EXPENSE> 29,256
<INCOME-PRETAX> (3,283,149)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,283,149)
<EPS-BASIC> (1.55)
<EPS-DILUTED> (1.55)
</TABLE>
