SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the Quarterly Period Ended May 31, 1995
Or
[ ] 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 0-21160
THE MICROCAP FUND, INC.
(Exact Name of Registrant as Specified in its Charter)
Maryland 13-3698251
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
733 Third Avenue, 11th floor
New York, New York 10017
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (800) 888-6534
Not applicable
Former name, former address and former fiscal year, if changed since last report
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
<PAGE>
THE MICROCAP FUND, INC.
INDEX
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
Statements of Assets and Liabilities as of May 31, 1995 (Unaudited) and February
28, 1995
Schedule of Portfolio Investments as of May 31, 1995 (Unaudited)
Statements of Operations for the Three Months Ended May 31, 1995 and 1994
(Unaudited)
Statements of Changes in Net Assets for the Three Months ended May 31, 1995 and
1994 (Unaudited)
Statements of Cash Flows for the Three Months ended May 31, 1995 and 1994
(Unaudited)
Notes to Financial Statements (Unaudited)
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
Item 2. Changes in Securities.
Item 3. Defaults upon Senior Securities.
Item 4. Submission of Matters to a Vote of Security Holders.
Item 5. Other Information.
Item 6. Exhibits and Reports on Form 8-K.
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
THE MICROCAP FUND, INC.
STATEMENTS OF ASSETS AND LIABILITIES
<TABLE>
May 31, 1995 February 28,
(Unaudited) 1995
<S> <C> <C>
ASSETS
Portfolio investments at fair value (cost $10,675,962 at
May 31, 1995 and $8,335,962 at February 28, 1995) $ 11,078,725 $ 8,371,350
Cash and cash equivalents 6,293,856 9,033,750
Receivable (net of unamortized discount of $3,000 at
May 31, 1995 and $0 at February 28, 1995) - Note 2 37,000 100,000
Accrued interest receivable 383,276 422,938
Deferred organizational costs (net of accumulated amortization of
$86,728 at May 31, 1995 and $76,885 at February 28, 1995) 110,137 119,980
Other assets - 6,422
- -----
Total assets 17,902,994 18,054,440
---------- ----------
LIABILITIES
Deferred interest income 50,925 53,350
Payable for common stock repurchased 569,875 -
Accounts payable and accrued expenses 146,971 141,965
Due to Administrator 85,234 144,052
------ -------
Total liabilities 853,005 339,367
------- -------
NET ASSETS
Preferred Stock, par value $.01; 2,000,000 shares authorized;
440,800 shares issued and 424,050 shares outstanding - Note 4 4,241 -
Common Stock, par value $.01; 10,000,000 shares authorized;
2,221,587 shares issued and 2,039,087 shares outstanding at
May 31, 1995 and 2,204,000 shares issued and outstanding at
February 28, 1995 - Note 4 22,216 22,040
Additional paid-in-capital 19,536,776 19,541,193
Net unrealized appreciation of portfolio investments 402,763 35,388
Undistributed (distribution in excess of) net investment income (50,459) (95,219)
Accumulated net realized loss from portfolio investments (2,139,673) (1,788,329)
---------- ----------
Sub-total 17,775,864 17,715,073
Less Treasury Stock at cost (182,500 shares of Common Stock) - Note 3 (725,875) -
-------- -
Net Assets $ 17,049,989 $ 17,715,073
= ========== = ==========
Net assets per outstanding share of Common Stock $ 6.86 $ 8.04
= ==== = ====
Net assets per outstanding share of Preferred Stock $ 7.21 -
= ==== =
</TABLE>
See notes to financial statements.
<PAGE>
THE MICROCAP FUND, INC.
SCHEDULE OF PORTFOLIO INVESTMENTS (UNAUDITED)
MAY 31, 1995
<TABLE>
% of
Issuer / Position Cost Fair Value Net Assets(1)
Publicly-Held Securities:
Alamar Biosciences, Inc.
<C> <C> <C>
150,000 shares of Common Stock $ 287,456 $ 151,875
Warrants to purchase 250,000 shares of Common Stock
at $5.00 per share, expiring 10/14/97 20,906 31,250
------ ------
308,362 183,125 1.07%
------- -------
Privately-Held Securities:
Bennett Environmental Inc.
Warrants to purchase 900,000 shares of Common Stock
at $.79 per share, expiring 9/1/98 900 900
Bennett Environmental U.S., Inc.
8% Secured Promissory Note due 9/14/95 1,200,000 720,000
--------- -------
1,200,900 720,900 4.23%
--------- -------
First Colony Acquisition Corp.
96,250 shares of Preferred Stock 536,673 536,673
4% Convertible Promissory Note due 11/30/97 1,213,327 1,213,327
Warrant to purchase 7,560 shares of Common Stock
at $5.00, expiring 1/24/00 0 0
- -
1,750,000 1,750,000 10.26%
--------- ---------
International Communication Technologies, Inc.
9% Convertible Promissory Note due 6/30/96 150,000 150,000 .88%
------- -------
Oh-La-La! Inc.(A)
9% Convertible Senior Note due 6/30/95 140,000 140,000
9% Convertible Senior Note due 11/30/95 100,000 100,000
------- -------
240,000 240,000 1.41%
------- -------
Optiva Corporation
150,000 shares of Common Stock 487,500 487,500 2.86%
------- -------
Regency Holdings (Cayman), Inc.*(B)
18% Promissory Note due 7/19/95 1,940,000 1,940,000
Warrant to purchase 291,456 shares of Common Stock
at $6.75 per share, expiring 7/20/98 0 0
- -
1,940,000 1,940,000 11.38%
--------- ---------
Shells Seafood Restaurants, Inc.*
9% Senior Secured Note due 10/30/95 1,310,000 1,310,000
300,000 shares of Common Stock 90,000 1,590,000
Secured note at prime plus 2% due 10/30/95 500,000 500,000
Warrant to purchase 10,000 shares of Preferred Stock
at $25 per share, expiring 12/31/99 0 0
- -
1,900,000 3,400,000 19.94%
--------- ---------
</TABLE>
<PAGE>
THE MICROCAP FUND, INC.
SCHEDULE OF PORTFOLIO INVESTMENTS (UNAUDITED) - continued
MAY 31, 1995
<TABLE>
% of
Issuer / Position Cost Fair Value Net Assets(1)
Unigene Laboratories, Inc.
<C> <C> <C> <C>
13% Secured Promissory Note due 7/7/95 $ 2,000,000 $ 2,000,000
Warrant to purchase 75,000 shares of Common Stock
at $1.80, expiring 5/7/00 0 0
- -
2,000,000 2,000,000 11.73%
--------- ---------
YES! Entertainment Corporation(C)
608,696 shares of Preferred Stock 699,200 207,200
Warrant to purchase 116,667 shares of Preferred Stock
at $1.50 per share, expiring 7/16/98 0 0
- -
699,200 207,200 1.22%
------- ------- ------
Total Portfolio Investments(D) $ 10,675,962 $ 11,078,725 64.98%
= ========== = ========== =====
</TABLE>
* May be deemed an "affiliated person" of the Fund as such term is defined in
the Investment Company Act of 1940.
(1) Represents fair value as a percentage of net assets.
(A) During fiscal 1995, Oh-La-La! Inc. filed for Chapter 11 bankruptcy
protection. The assets of Oh-La-La! are being liquidated through court
proceedings. The Fund currently expects to receive cash and/or equity
securities of a public company at the conclusion of these proceedings.
(B) In March 1995, the Fund agreed to extend the maturity date of its
promissory note due from Regency Holdings (Cayman), Inc. to July 19, 1995.
In consideration for such extension, the terms of the Fund's warrant to
purchase common shares of Regency was adjusted, increasing the number of
shares from 211,200 to 291,456 and reducing the exercise price from $9.00
per share to $6.75 per share.
(C) On June 8, 1995, Yes! Entertainment Corporation completed an initial public
offering of its common stock at $4.75 per share. As a result of the
automatic conversion of the preferred stock and a stock split effected in
connection with the offering, the Fund's 608,696 shares of preferred stock
and warrant to purchase 116,667 shares of preferred stock of Yes!
Entertainment at $1.50 per share were converted into 55,556 shares of
common stock and a warrant to purchase 11,438 common shares at $15.30 per
share.
(D) On March 24, 1995, the Fund sold its investment in SR Communications Corp.
("SRC") for $200,000 in cash and a $40,000 promissory note (including
$4,000 of imputed interest) from SRC payable on March 24, 1996. The Fund
realized a $14,000 loss on this transaction. During May 1995, the Fund sold
its investment in Silverado Foods, Inc. for $822,656, realizing a gain of
$672,656. Additionally during the quarter, the Fund wrote-off its $60,000
investment in Radiator King International, Inc. and its $950,000 investment
in Weir-Jones Marketing, Inc.
See notes to financial statements.
<PAGE>
THE MICROCAP FUND, INC.
STATEMENTS OF OPERATIONS (UNAUDITED)
For the Three Months Ended May 31,
<TABLE>
1995 1994
---- ----
INVESTMENT INCOME AND EXPENSES
Income:
<S> <C> <C>
Interest from repurchase agreements $ 115,965 $ 52,179
Interest and dividends from portfolio investments 69,883 159,912
------ -------
Total investment income 185,848 212,091
------- -------
Expenses:
Administrative fee 42,732 44,179
Professional fees 20,709 60,926
Salary expense 42,502 28,422
Amortization of deferred organizational costs 9,843 9,843
Transfer agent and custodian fees 5,690 2,792
Directors' fees and expenses 7,952 4,500
Other operating expenses 11,660 18,966
------ ------
Total expenses 141,088 169,628
------- -------
NET INVESTMENT INCOME 44,760 42,463
------ ------
NET REALIZED AND UNREALIZED GAIN FROM PORTFOLIO
INVESTMENTS
Net realized loss from portfolio investments (351,344) (96,503)
Change in net unrealized appreciation or depreciation of investments 367,375 133,097
------- -------
Net realized and unrealized gain from portfolio investments 16,031 36,594
------ ------
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS $ 60,791 $ 79,057
= ====== = ======
</TABLE>
See notes to financial statements.
<PAGE>
THE MICROCAP FUND, INC.
STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED)
For the Three Months Ended May 31,
<TABLE>
1995 1994
---- ----
Change in net assets resulting from operations:
<S> <C> <C>
Net investment income $ 44,760 $ 42,463
Net realized loss from portfolio investments (351,344) (96,503)
Change in net unrealized appreciation or depreciation of portfolio
investments 367,375 133,097
------- -------
Net increase in net assets resulting from operations 60,791 79,057
------ ------
Change in net assets from capital stock transactions:
Common Stock repurchased - Note 3 (725,875) -
-------- -
Total increase (decrease) in net assets for the period (665,084) 79,057
Net assets at beginning of period 17,715,073 17,548,222
---------- ----------
NET ASSETS AT END OF PERIOD $ 17,049,989 $ 17,627,279
= ========== = ==========
</TABLE>
See notes to financial statements.
<PAGE>
THE MICROCAP FUND, INC.
STATEMENTS OF CASH FLOWS (UNAUDITED)
For the Three Months Ended May 31,
<TABLE>
1995 1994
---- ----
CASH FLOWS PROVIDED FROM (USED FOR) OPERATING
ACTIVITIES
<S> <C> <C>
Net investment income $ 44,760 $ 42,463
Adjustments to reconcile net investment income to cash provided from
(used for) operating activities:
Amortization of discount on accounts receivable (1,000) (15,186)
Amortization of deferred organizational costs 9,843 9,843
Increase (decrease) in payables and other liabilities (56,237) 916
(Increase) decrease in receivables and other assets 46,084 (94,813)
------ -------
Cash flows provided from (used for) operating activities 43,450 (56,777)
------ -------
CASH FLOWS PROVIDED FROM (USED FOR) INVESTING
ACTIVITIES
Cost of portfolio investments (3,750,000) (1,333,898)
Net proceeds from the sale of portfolio investments 1,122,656 2,569,555
Deposit released from escrow - 15,000
- ------
Cash flows provided from (used for) investing activities (2,627,344) 1,250,657
---------- ---------
CASH FLOWS USED FOR FINANCING ACTIVITIES
Common Stock repurchased (156,000) -
-------- -
Increase (decrease) in cash and cash equivalents (2,739,894) 1,193,880
Cash and cash equivalents at beginning of period 9,033,750 4,475,544
--------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 6,293,856 $ 5,669,424
= ========= = =========
</TABLE>
See notes to financial statements.
<PAGE>
THE MICROCAP FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. Organization and Purpose
The MicroCap Fund, Inc. (the "Fund"), formerly known as Commonwealth Associates
Growth Fund, Inc., is a non-diversified, closed-end management investment
company operating as a business development company under the Investment Company
Act of 1940. The Fund was incorporated under the laws of the State of Maryland
on January 26, 1993. The Fund's investment objective is to achieve intermediate
to long-term capital appreciation of assets by investing in securities of
emerging and established companies that management believes offer significant
growth potential.
Reference is made to the Fund's February 28, 1995 annual report included in Form
10-K as filed with the Securities and Exchange Commission for the Notes to
Financial Statements that remain unchanged. The following notes are included as
a result of changes during the current quarter.
2. Receivables
In March 1995, the Fund received the final installment payment of $100,000
relating to the $1 million receivable due from Computer Integration Corporation.
On March 24, 1995, the Fund sold its investment in SR Communications Corp.
("SRC") for $200,000 in cash and a $40,000 promissory note from SRC payable on
March 24, 1996.
3. Common Stock Repurchase Program
In May 1995, the Board of Director's increased the amount authorized for the
repurchase of the Fund's common stock to an aggregate amount of $2 million. As
of May 31, 1995, the Fund had repurchased 182,500 shares of its common stock for
an aggregate cost of $725,875. In June 1995, the Fund repurchased an additional
37,500 shares of its common stock for an aggregate cost of $171,094.
4. Capital Stock Transactions
On March 20, 1995, the Fund paid a stock dividend to shareholders of record on
March 13, 1995 in shares of preferred stock at the rate of .2 shares of
preferred stock for each share of common stock. The preferred stock is
convertible into shares of the Fund's common stock at any time until February
27, 1998. Each share of preferred stock is convertible into (i) 1.05 shares of
common stock from the date of issuance through February 28, 1996, (ii) 1.25
shares of common stock from March 1, 1996 through February 28, 1997 and (iii)
1.33 shares of common stock from March 1, 1997 through February 27, 1998. The
preferred stock will automatically convert into common stock on the earlier of
(i) a sale, transfer or other distribution of the shares of common stock upon
which the dividend has been paid or (ii) February 27, 1998. The preferred stock
is non-transferable. During the quarter ended May 31, 1995, 16,750 shares of
preferred stock were converted into 17,587 shares of common stock.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Results of Operations
Realized and Unrealized Gains and Losses from Portfolio Investments
For the three months ended May 31, 1995, the Fund had a $16,031 net realized and
unrealized gain from portfolio investments, comprised of a $351,344 net realized
loss from portfolio investments and a $367,375 increase in net unrealized
appreciation of investments.
In May 1995, the Fund sold its 337,500 shares of Silverado Foods, Inc. common
stock for $822,656, realizing a gain of $672,656. In March 1995, the Fund sold
its investment in SR Communications Corp. ("SRC") for $200,000 in cash and a
$40,000 promissory note (including $4,000 of imputed interest) payable in March
1996. This transaction resulted in a net realized loss of $14,000. Also in May
1995, the Fund wrote-off its $60,000 investment in Radiator King International,
Inc. and its $950,000 investment in Weir-Jones Marketing, Inc. due to the
continued operating and financial difficulties of these companies.
The $367,375 increase in net unrealized appreciation for the quarter was
comprised of a $976,750 net unrealized gain due to the net upward revaluation of
the Fund's remaining portfolio investments, which was offset by a $609,375
transfer from unrealized gain to realized gain due to the sale of Silverado
Foods. The $976,750 net unrealized gain for the three months ended May 31, 1995
included a $1.5 million upward revaluation of the Fund's investment in Shells
Seafood Restaurants, Inc. and downward revaluations of Yes! Entertainment
Corporation in the amount of $492,000 and Alamar Biosciences, Inc. in the amount
of $31,250.
For the three months ended May 31, 1994, the Fund had a $36,594 net unrealized
and realized gain from portfolio investments, comprised of a $133,097 increase
in net unrealized appreciation of investments offset by a $96,503 net realized
loss from portfolio investments.
The $96,503 net realized loss for the three months ended May 31, 1994 includes
the sale of 50,000 common shares of Alamar Biosciences, Inc. resulting in a
$11,056 net realized gain offset by the sale of certain marketable securities
resulting in a $107,559 net realized loss. Additionally, in March 1994, the Fund
sold its $1.5 million investment in EMARC, Inc. for its original cost plus
interest on the debt portion of the investment, resulting in no gain or loss.
The $133,097 increase in net unrealized appreciation of investments for the
three months ended May 31, 1994 was comprised of a $75,437 net upward
revaluation of the Fund's remaining portfolio investments and a $57,660 transfer
from unrealized loss to realized loss relating to the portfolio investments sold
during the three months ended May 31, 1994.
Investment Income and Expenses
For the three months ended May 31, 1995 and 1994, the Fund had net investment
income of $44,760 and $42,463, respectively. An increase in interest earned from
repurchase agreements for the three months ended May 31, 1995 was more than
offset by a decrease in interest and dividend income earned from portfolio
investments for the three months ended May 31, 1995. Interest from repurchase
agreements was $115,965 and $52,179 for the three months ended May 31, 1995 and
1994, respectively. This increase resulted from an increase in funds invested in
repurchase agreements and an increase in short-term interest rates during the
three months ended May 31, 1995. Interest and dividend income from portfolio
investments was $69,883 and $159,912 for the three months ended May 31, 1995 and
1994, respectively. The decrease for the three months ended May 31, 1995
resulted from the write-off of $92,863 of accrued interest receivable relating
to the Fund's debt investment in Weir-Jones Marketing, Inc., which was
written-off at May 31, 1995. Although aggregate investment income declined by
$26,243 for the three months ended May 31, 1995, the Fund's operating expenses
declined $28,540, resulting in a $2,297 increase in net investment income for
the three months ended May 31, 1995 compared to the same period in 1994.
Commonwealth Associates Asset Management, Inc. (the "Administrator") is
responsible for providing, or arranging for the provision of, the administrative
services necessary for the operation of the Fund. In return for such services,
the Administrator receives an administrative fee at the annual rate of 1% of the
net assets of the Fund. Such fee is determined and payable quarterly. For the
three months ended May 31, 1995 and 1994, the administrative fee was $42,732 and
$44,179, respectively.
Net Assets
At May 31, 1995, the Fund's net assets were $17,049,989, a decrease of $665,084
from net assets of $17,715,073 at February 28, 1995. Net assets resulting from
operations for the period increased $60,791 which was comprised of $44,760 of
net investment income and $16,031 net realized and unrealized gain from
portfolio investments. This increase was more than offset by a $725,875 decrease
in net assets due to the repurchase of 182,500 shares of the Fund's common stock
in the public market during the period.
At May 31, 1995, the net asset value per share of common stock and preferred
stock was $6.86 and $7.21 per share, respectively. At February 28, 1995, the net
asset value per share of common stock was $8.04. There was no preferred stock
was outstanding on February 28, 1995. The changes in the net asset value per
share of common stock and preferred stock for the three months ended May 31,
1995 are discussed below.
On March 20, 1995, the Fund issued a 20% preferred stock dividend to
shareholders of record on March 13, 1995. Based on the Fund's net assets of
$17,715,073 at February 28, 1995, such dividend resulted in an initial
allocation of net assets to preferred shareholders of approximately $3.1
million, or $6.97 per share of preferred stock. The allocation of net assets to
preferred shareholders, therefore, resulted in a dilution to common shareholders
of approximately $3.1 million, or $1.40 per share of common stock. Furthermore,
during the three months ended May 31, 1995, the Fund repurchased 182,500 shares
of common stock for $725,875. The effect of such repurchases increased the net
asset value per share of common stock and preferred stock by $.20 and $.21,
respectively. The increase in net assets from operations for the three months
ended May 31, 1995 of $60,791 increased the net asset value by $.02 and $.03 per
share of common stock and preferred stock, respectively.
At May 31, 1994, the Fund's net assets were $17,627,279, an increase of $79,057
from $17,548,222 at February 28, 1994. This increase was comprised of $42,463 of
net investment income and a $36,594 net realized and unrealized gain from
portfolio investments for the period.
Liquidity and Capital Resources
The Fund invests its available cash in overnight repurchase agreements
collateralized by securities issued by the U.S. Government or its agencies. Such
investments provide the liquidity necessary to purchase additional portfolio
investments as opportunities for investment arise.
On May 31, 1995, the Fund had cash and cash equivalents of $6,293,856 a decrease
of $2,739,894 from February 28, 1995. This decrease primarily was the result of
the use of $2,627,344 to fund investing activities for the three months ended
May 31, 1995. During the quarter, the Fund invested $3,750,000 in two new
portfolio investments: First Colony Acquisition Corp. in the amount of
$1,750,000 and Unigene Laboratories, Inc. in the amount of $2,000,000. The Fund
received proceeds from the sale of Silverado and SRC during the three months
ended May 31, 1995 totaling $1,022,656. During the three months ended May 31,
1995, the Fund also received the final $100,000 installment payment due from
Computer Integration Corporation. The Fund also used $156,000 during the three
months ended May 31, 1995 to repurchase 36,500 shares of its own common stock.
The repurchase of an additional 146,000 shares for $569,875 was executed in May
1995 and settled and paid for in June 1995.
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
The Fund is not party to any material pending legal proceedings.
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.
The 1995 Annual Meeting of Shareholders is scheduled to be held on August 28,
1995.
Item 5. Other Information.
On March 31, 1995, the Fund invested $1,750,000 in First Colony Acquisition
Corp., acquiring 96,250 shares of preferred stock, a $1,213,327 promissory note
and a warrant to purchase 7,560 shares of First Colony common stock at $5 per
share. First Colony is a retailer of gourmet coffee beans.
On May 8, 1995, the Fund invested $2,000,000 in Unigene Laboratories, Inc.,
acquiring a $2,000,000 promissory note and a warrant to purchase 75,000 shares
of Unigene common stock at $1.80 per share. Unigene manufactures a drug used in
the treatment of osteoporosis.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
(27) Financial Data Schedule
(b) Reports on Form 8-K
None.
<PAGE>
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.
THE MICROCAP FUND, INC.
/s/ Kamal Mustafa
Kamal Mustafa
President, Chief Executive Officer and Director
(Principal Executive Officer)
/s/ Mark T. Behrman
Mark T. Behrman
Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer)
Date: July 13, 1995
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE MICROCAP
FUND, INC.'S QUARTERLY REPORT ON FORM 10-Q FOR THE PERIOD ENDED MAY 31, 1995 AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> FEB-28-1996
<PERIOD-START> MAR-01-1995
<PERIOD-END> MAY-31-1995
<INVESTMENTS-AT-COST> 10,675,962
<INVESTMENTS-AT-VALUE> 11,078,725
<RECEIVABLES> 420,276
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 6,403,993
<TOTAL-ASSETS> 17,902,994
<PAYABLE-FOR-SECURITIES> 569,875
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 283,130
<TOTAL-LIABILITIES> 853,005
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 19,536,776
<SHARES-COMMON-STOCK> 2,039,087
<SHARES-COMMON-PRIOR> 2,204,000
<ACCUMULATED-NII-CURRENT> (50,459)
<OVERDISTRIBUTION-NII> (50,459)
<ACCUMULATED-NET-GAINS> (2,139,673)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 402,763
<NET-ASSETS> 17,049,989
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 185,848
<OTHER-INCOME> 0
<EXPENSES-NET> 141,088
<NET-INVESTMENT-INCOME> 44,760
<REALIZED-GAINS-CURRENT> (351,344)
<APPREC-INCREASE-CURRENT> 367,375
<NET-CHANGE-FROM-OPS> 60,791
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (151,446)
<ACCUMULATED-NII-PRIOR> (95,219)
<ACCUMULATED-GAINS-PRIOR> (1,788,329)
<OVERDISTRIB-NII-PRIOR> (95,219)
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 17,382,531
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
