UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, 20549
FORM 10-Q
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1998
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE EXCHANGE ACT
For the transition period from ________to________
Commission file number 0-22904
-------
PARKERVISION, INC.
(Exact name of registrant as specified in its charter)
FLORIDA 59-2971472
(State or other jurisdiction of I.R.S. Employer ID No.
incorporation or organization)
8493 BAYMEADOWS WAY
JACKSONVILLE, FLORIDA 32256
(904) 737-1367
(Address of principal executive offices)
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 [ ].
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes [ ] No [ ].
APPLICABLE ONLY TO CORPORATE ISSUERS
As of July 31, 1998, 11,404,143 shares of the Issuer's Common Stock, $.01 par
value, were outstanding.
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The accompanying unaudited financial statements of ParkerVision, Inc. (the
"Company") have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions to Form
10-Q and Rule 10-01 of Regulation S-X. All adjustments which, in the opinion of
management, are necessary for a fair presentation of the financial condition and
results of operations have been included. Operating results for the three and
six month periods ended June 30, 1998 are not necessarily indicative of the
results that may be expected for the year ending December 31, 1998.
These interim consolidated financial statements should be read in conjunction
with the Company's latest Annual Report on Form 10-KSB for the year ended
December 31, 1997.
2
<PAGE>
PARKERVISION, INC.
BALANCE SHEETS
<TABLE>
<CAPTION>
June 30,
1998 December 31,
ASSETS (unaudited) 1997
------ ------------ ------------
CURRENT ASSETS:
<S> <C> <C>
Cash and cash equivalents $ 2,936,072 $ 2,133,193
Short-term investments 17,959,516 18,815,957
Accounts receivable, net of allowance for
doubtful accounts of $32,383 and $38,405 at
June 30, 1998 and December 31, 1997, respectively 1,526,999 660,947
Interest and other receivables 277,398 386,634
Inventories, net 3,800,345 2,970,087
Prepaid expenses and other 638,530 610,915
------------ ------------
Total current assets 27,138,860 25,577,733
------------ ------------
LONG-TERM INVESTMENTS 5,001,194 9,494,404
------------ ------------
PROPERTY AND EQUIPMENT, net 2,915,685 2,541,123
------------ ------------
OTHER ASSETS, net 1,257,650 1,071,772
------------ ------------
Total assets $ 36,313,389 $ 38,685,032
============ ============
</TABLE>
The accompanying notes are an integral part of these balance sheets.
3
<PAGE>
PARKERVISION, INC.
BALANCE SHEETS
<TABLE>
<CAPTION>
June 30,
1998 December 31,
LIABILITIES AND SHAREHOLDERS' EQUITY (unaudited) 1997
------------------------------------ ------------ ------------
CURRENT LIABILITIES:
<S> <C> <C>
Accounts payable $ 669,523 $ 560,106
Accrued expenses:
Salaries and wages 260,765 313,267
Professional fees and other 353,883 259,096
Deferred revenue 36,727 20,973
------------ ------------
Total current liabilities 1,320,898 1,153,442
------------ ------------
DEFERRED INCOME TAXES 4,678 4,678
------------ ------------
COMMITMENTS AND CONTINGENCIES (Notes 4 and 5)
SHAREHOLDERS' EQUITY:
Preferred stock, $1 par value, 1,000,000 shares
authorized, none issued or outstanding 0 0
Common stock, $.01 par value, 20,000,000 shares
Authorized, 11,404,143 and 11,337,707 shares issued
and outstanding at June 30, 1998 and December
31, 1997, respectively 114,042 113,377
Warrants outstanding 3,795,532 3,795,618
Additional paid-in capital 46,158,929 45,920,419
Unrealized gain on investments available for sale 19,141 0
Accumulated deficit (15,099,831) (12,302,502)
------------ ------------
Total shareholders' equity 34,987,813 37,526,912
------------ ------------
Total liabilities and shareholders' equity $ 36,313,389 $ 38,685,032
============ ============
</TABLE>
The accompanying notes are an integral part of these balance sheets.
4
<PAGE>
PARKERVISION, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended June 30, Six months ended June 30,
--------------------------- ---------------------------
1998 1997 1998 1997
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues, net $ 2,589,781 $ 4,007,472 $ 4,554,775 $ 6,087,429
Cost of goods sold 1,492,396 2,172,974 2,824,986 3,332,110
----------- ----------- ----------- -----------
Gross margin 1,097,385 1,834,498 1,729,789 2,755,319
Marketing and selling expenses 1,305,239 1,048,778 2,268,230 1,823,653
Research and development expenses 885,287 752,497 1,882,855 1,448,073
General and administrative expenses 650,087 469,093 1,169,734 837,446
Interest income (390,406) (168,138) (793,701) (343,040)
----------- ----------- ----------- -----------
Net loss $(1,352,822) $ (267,732) $(2,797,329) $(1,010,813)
=========== =========== =========== ===========
Basic loss per common share $ (0.12) $ (0.03) $ (0.25) $ (0.10)
=========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these statements.
5
<PAGE>
PARKERVISION, INC.
STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------------- ---------------------------
1998 1997 1998 1997
----------- ----------- ----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C> <C> <C>
Net loss $(1,352,822) $ (267,732) $(2,797,329) $(1,010,813)
Adjustments to reconcile net loss to net cash
used for operating activities:
Depreciation and amortization 178,600 175,279 332,076 311,471
Provision for obsolete inventories 60,000 30,000 90,000 80,000
Changes in operating assets and liabilities:
Increase in accounts receivable, net (922,465) (845,708) (866,052) (614,114)
(Increase) decrease in interest and other
receivables (108,854) (63,075) 109,236 (7,856)
Decrease (increase) in inventories, net 203,519 28,286 (920,258) (487,369)
Decrease (increase) in prepaid expenses 321,184 79,036 (27,615) (59,578)
Increase in other assets (274,024) 0 (301,373) (22,758)
(Decrease) increase in accounts payable and
accrued expenses (609,456) 284,605 151,702 852,904
Increase (decrease) in deferred revenue 12,920 5,686 15,754 (12,832)
----------- ----------- ----------- -----------
Total adjustments (1,138,576) (305,891) (1,416,530) 39,868
----------- ----------- ----------- -----------
Net cash used for operating activities (2,491,398) (573,623) (4,213,859) (970,945)
----------- ----------- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from maturity of investments 0 3,000,000 5,500,000 4,000,000
Purchase of property and equipment (434,903) (601,305) (722,351) (751,062)
----------- ----------- ----------- -----------
Net cash (used for) provided by investing
activities (434,903) 2,398,695 4,777,649 3,248,938
----------- ----------- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock 89,649 350,888 239,089 581,001
----------- ----------- ----------- -----------
Net cash provided by financing activities 89,649 350,888 239,089 581,001
----------- ----------- ----------- -----------
NET CHANGE IN CASH AND CASH EQUIVALENTS (2,836,652) 2,175,960 802,879 2,858,994
CASH AND CASH EQUIVALENTS, beginning of period 5,772,724 2,237,766 2,133,193 1,554,732
----------- ----------- ----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 2,936,072 $ 4,413,726 $ 2,936,072 $ 4,413,726
=========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these statements.
6
<PAGE>
PARKERVISION, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
1. ACCOUNTING POLICIES
-------------------
There have been no changes in accounting policies from those stated in the
Annual Report on Form 10-KSB for the year ended December 31, 1997
CASH AND CASH EQUIVALENTS. Cash and cash equivalents include overnight
repurchase agreements and U.S. Treasury money market investments totaling
approximately $2,592,000 and $1,845,000 at June 30, 1998 and December 31,
1997, respectively.
2. LOSS PER SHARE
--------------
Basic loss per share is determined based on the weighted average number of
common shares assumed to be outstanding during each period. Dilutive loss
per share is the same as basic loss per share as all common share
equivalents are excluded from the calculation as their effect is
anti-dilutive. The weighted average number of common shares assumed to be
outstanding for the three month periods ended June 30, 1998 and 1997 is
11,391,388 and 10,098,482, respectively. The weighted average number of
common shares assumed to be outstanding for the six month periods ended
June 30, 1998 and 1997 is 11,369,251 and 10,069,160, respectively.
3. INVENTORIES:
------------
Inventories consist of the following:
June 30, December 31,
1998 1997
----------- -----------
Purchased materials $ 2,307,733 $ 1,948,581
Work in process 594,243 378,859
Finished goods 1,238,450 1,059,699
----------- -----------
4,140,426 3,387,139
Less allowance for inventory obsolescence (340,081) (417,052)
----------- -----------
$ 3,800,345 $ 2,970,087
=========== ===========
7
<PAGE>
4. SIGNIFICANT CUSTOMERS
---------------------
For the three months ended June 30, 1998, Vtel Corporation and one other
customer accounted for approximately 45% and 10% of total revenues,
respectively. Vtel Corporation accounted for 50% of total revenues for the
three months ended June 30, 1997.
For the six month period ended June 30, 1998 and 1997, Vtel Corporation
accounted for approximately 35% and 49% of total revenues, respectively.
5. STOCK OPTIONS
-------------
In May, 1998, pursuant to an employment agreement, the Company authorized
the grant of nonqualified stock options to purchase an aggregate of 476,625
shares of its common stock for $21.375 per share to Richard L. Sisisky, the
Company's President and Chief Operating Officer. These options were not
issued under a plan and they expire ten years from the date of grant.
Options to purchase 226,625 shares vest over a five year period commencing
on December 31, 1998. Options to purchase the remaining 250,000 shares vest
approximately five and one half years from the date of grant, but may be
accelerated based on certain performance criteria. In addition, the Company
authorized the grant of incentive stock options, under the 1993 Stock Plan,
to purchase an aggregate of 23,375 shares of its common stock for $21.375
per share to Mr. Sisisky. These options vest ratably over five years
commencing on December 31, 1998.
On May 26, 1998, the Company also granted certain employees incentive stock
options under the 1993 stock plan to purchase an aggregate of 114,965
shares of common stock at an exercise price of $20.75 per share. These
options vest ratably over three to five years and expire five years from
the date they become exercisable.
In addition, on May 26, 1998, the Company granted certain employees
nonqualified stock options under the 1993 stock plan to purchase an
aggregate of 65,000 shares of common stock at an exercise price of $20.75
per share. These options generally vest ten years from the date of grant
and expire five years from the date they become exercisable.
Options to purchase 331,230 shares of common stock were available for
future grants under the 1993 stock plan at June 30, 1998.
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
FORWARD-LOOKING STATEMENTS
- --------------------------
When used in this Form 10-Q and in future filings by the Company with the
Securities and Exchange Commission, the words or phrases "will likely result",
"management expects" or "Company expects", "will continue", "is anticipated",
"estimated" or similar expressions are intended to identify "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Readers are cautioned not to place undue reliance on such
forward-looking statements, each of which speak only as of the date made. Such
statements are subject to certain risks and uncertainties that could cause
actual results to differ materially from historical earnings and those presently
anticipated or projected, including the timely development and acceptance of new
products, sources of supply and concentration of customers. The Company has no
obligation to publicly release the results of any revisions which may be made to
any forward-looking statements to reflect anticipated events or circumstances
occurring after the date of such statements.
RESULTS OF OPERATIONS FOR EACH OF THE THREE AND SIX MONTH PERIODS ENDED JUNE 30,
- --------------------------------------------------------------------------------
1998 AND 1997
- -------------
Revenues
- --------
Revenues for the three months ended June 30, 1998 were $2,589,781, as compared
to $4,007,472 for the three months ended June 30, 1997. This decrease of
$1,417,691 is primarily a result of a decrease in the number of camera systems
sold, offset somewhat by an increase in the average selling price per camera
system. The Company sold 381 camera systems during the three month period ended
June 30, 1998, at an average selling price of approximately $6,800 per system.
This compares to 694 camera system sales for the three month period ended June
30, 1997, at an average selling price of approximately $5,800 per system.
Revenues for the six months ended June 30, 1998 were $4,554,775, as compared to
$6,087,429 for the six months ended June 30, 1997. This decrease of $1,532,654
is a result of a decrease in the number of camera systems sold, offset by an
increase in the average selling price per camera system and revenues generated
from the Company's first beta site sales of its studio production system. The
Company sold 609 camera systems during the six month period ended June 30, 1998,
at an average selling price of approximately $7,000 per system. This compares to
1,037 camera system sales for the six month period ended June 30, 1997, at an
average selling price of approximately $5,900 per system.
Management believes the decrease in camera system sales for the three and six
month periods is primarily due to the timing of OEM purchases, along with a
change in the focus of the internal sales organization toward its new studio
product. As of June 30, 1997, the Company had
9
<PAGE>
realized approximately 75% of its total 1997 revenues from OEM accounts. The
Company believes its OEM sales will be more ratably distributed throughout the
year in 1998. OEM accounts generally represent approximately 35% of the
Company's total cameras revenues. In addition, early in 1998, the Company
realigned its internal sales force to focus on the launch of its new studio
product. The Company's studio systems are currently priced to generate from
$150,000 to $250,000 and higher per system as compared to the average camera
system selling price of approximately $6,500 to $7,000 per system. The Company's
ability to generate revenues from its new studio system is dependent upon market
acceptance of this product.
The decrease in system sales in 1998, as compared to the corresponding periods
in 1997, is offset somewhat by increases in the average selling price per
system. These increases are a result of the mix of products sold and the sales
channels utilized. During the three and six months ended June 30, 1998, a larger
percentage of the Company's revenues were generated from tracking camera systems
and the international reseller sales channel, both of which carry a higher
selling price per system. The average selling price per camera system is
expected to decrease during the second half of 1998 due to one-time pricing
promotions on certain single-chip camera systems.
Gross Margin
- ------------
For the three month periods ended June 30, 1998 and 1997, gross margins as a
percentage of sales were 42.4% and 45.8%, respectively. This decrease is
primarily due to an increase in overhead costs, primarily facility rental costs,
when compared to the same period in 1997.
For the six month periods ended June 30, 1998 and 1997, gross margins as a
percentage of sales were 38.0% and 45.3%, respectively. This decrease is
primarily due to the cost of placing a new product, the studio system, into
production, pricing discounts offered on the initial beta sales of studio, and
an increase in overhead costs, primarily facility rental costs, for the first
half of 1998 when compared to the same period in 1997.
Due to the pricing promotions planned for the second half of 1998, the Company
anticipates a decline in gross margin as a percent of camera system sales for
the remainder of 1998. This decline may be offset somewhat by sales of the
Company's new studio product which are expected to generate margins similar to
or higher than the existing camera system sales.
Marketing and Selling Expenses
- ------------------------------
Marketing and selling expenses were $1,305,239 for the three month period ended
June 30, 1998, as compared to $1,048,778 for the same period in 1997. This
increase of $256,461 is primarily due to increased trade show costs associated
with launching the Company's studio product line along with the addition of a
wireless sales office in Oregon early in 1998.
For the six month periods ended June 30, 1998 and 1997, marketing and selling
expenses were $2,268,230 and $1,823,653, respectively. The increase of $444,577
is also attributable to increased trade show costs and the addition of a
wireless sales office.
10
<PAGE>
Research and Development Expenses
- ---------------------------------
The Company's research and development expenses were $885,287 and $752,497 for
the three month periods ended June 30, 1998 and 1997, respectively. This
increase of $132,790 is largely a result of increased resources dedicated to the
continued development of the Company's wireless technology.
For the six month periods ended June 30, 1998 and 1997, research and development
expenses were $1,882,855 and $1,448,073, respectively. This increase of $434,782
is primarily due to an increase in personnel and related costs for the
development of the studio product and the Company's wireless technology.
General and Administrative Expenses
- -----------------------------------
For the three month periods ended June 30, 1998 and 1997, general and
administrative expenses were $650,087 and $469,093, respectively. This increase
of $180,994 is primarily a result of increased personnel cost, increased use of
outside professional services, and the amortization of prepaid consulting fees.
For the six month periods ended June 30, 1998 and 1997, general and
administrative expenses were $1,169,734 and $837,446, respectively. This
increase of $332,288 is also attributable to increased personnel and
professional services and the amortization of prepaid consulting fees.
Interest Income
- ---------------
Interest income was $390,406 and $168,138 for the three month periods ended June
30, 1998 and 1997, respectively, and $793,701 and $343,040 for the six month
periods ended June 30, 1998 and 1997, respectively. The increase in interest
income is due to the investment of the proceeds from the Company's 1997
offerings, offset somewhat by the Company's use of proceeds from maturing
investments to fund operations during 1997 and 1998.
Backlog
- -------
As of June 30, 1998, the Company had a backlog of approximately $346,000.
Backlog consists of orders received that generally have a specified delivery
schedule within three to five weeks of receipt. During the last three quarters
the Company has been able to reduce its delivery schedule for most camera
products to approximately one week.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
At June 30, 1998, the Company had working capital of $25,817,962, an increase of
$1,393,671 from $24,424,291 at December 31, 1997. This increase in working
capital is primarily due to increases in accounts receivable and inventories.
The increase in accounts receivable is primarily due to the higher sales volume
for the second quarter of 1998 when compared to the fourth quarter of 1997.
Increases in inventory reflect preparation for production of the studio product
line.
11
<PAGE>
The Company's principal source of liquidity at June 30, 1998 consisted of
$20,895,588 in cash and short-term investments. Until the Company generates
sufficient revenues from product sales, it will be required to continue to
utilize this source of liquidity to cover the continuing expense of product
development, marketing and general administration. The Company believes its
source of liquidity will provide sufficient resources to meet its cash
requirements for the next twelve months as well as on a longer-term basis.
PART II - OTHER INFORMATION
ITEM 3. LEGAL PROCEEDINGS
Not applicable.
ITEM 2. CHANGES IN SECURITIES
Sales of Unregistered Securities
--------------------------------
<TABLE>
<CAPTION>
Consideration received and Exemption If option, warrant or
description of underwriting or from convertible security,
Date of Number other discounts to market price registration terms of exercise or
sale Title of security sold afforded to purchasers claimed conversion
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
5/98 Common stock 27,273 Cashless exercise of warrants; 4(2)
50,000 warrants at a fair market
value of $22 per share exchanged
for 27,273 shares of common stock
5/98 Options to purchase 250,000 Options granted - no 4(2) Exercisable through
common stock consideration received by 6/15/08; options vest
granted pursuant to Company until exercise over five year period
an employment commencing 12/31/98 at
agreement an exercise price of
$21.375 per share
12
<PAGE>
5/98 Options to purchase 250,000 Options granted - no 4(2) Exercisable through
common stock consideration received by 6/15/08 at an exercise
granted pursuant to Company until exercise price of $21.375 per
an employment share; options vest on
agreement the basis of three
criteria, the date
certain 12/15/03, or less
based on the price of a
share of common stock in
the years 1998 through
2002, or the percentage
increase in gross profit
of the Company over the
prior year
5/98 Options to purchase 114,965 Options granted - no 4(2) Exercisable for
common stock consideration received by periods lasting from
granted to Company until exercise five years from the
employees pursuant date the options
to stock option become vested; options
plans vest ratably over
three to five years
commencing May 26,
1998 at an exercise
price of $20.75 per
share
5/98 Options to purchase 65,000 Options granted - no 4(2) Exercisable for a
common stock consideration received by period lasting five
granted to Company until exercise years from the date
employees pursuant the options first
to stock option plan become vested; options
vest from six to ten
years at an exercise
price of $20.75 per
share
4/98 - Common stock 13,543 Received proceeds of $47,487 4(2) Underwriters warrants
6/98 granted 11/30/93
exercisable through
11/30/98 at an
exercise price of
$8.25 per share
</TABLE>
13
<PAGE>
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Company held its annual meeting on June 12, 1998. The stockholders elected
Messrs. Jeffrey Parker, Todd Parker, David Sorrells, William Sammons and Arthur
Yeager and Ms. Stacie Wilf as directors. The following is a tabulation of votes
cast for and against and abstentions for each director:
Votes Cast
--------------------------
Name For Against Abstentions
---------------------------------------------------------------------------
Jeffrey Parker
Todd Parker 8,727,588 1,427 0
David Sorrells 8,727,588 1,427 0
William Sammons 8,727,588 1,427 0
Arthur Yeager 8,727,588 1,427 0
Stacie Wilf 8,727,588 1,427 0
ITEM 5. OTHER INFORMATION
Notice to Stockholders Regarding 1999 Annual Meeting of Stockholders:
Pursuant to Rule 14a-4 promulgated by the Securities and Exchange Commission,
stockholders are advised that the Company's management will be permitted to
exercise discretionary voting authority under proxies it solicits and obtains
for the Company's 1999 Annual Meeting of Stockholders with respect to any
proposal presented by a stockholder at such meeting, without any discussion of
the proposal in the Company's proxy statement for such meeting, unless the
Company receives notice of such proposal at its principal office in
Jacksonville, Florida not later than March 17, 1999.
14
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit 27.1 Financial Data Schedule
(b) No reports on Form 8-K were filed during the quarter ended June 30, 1998.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant has duly
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
ParkerVision, Inc.
Registrant
August 13, 1998 By: /s/ Jeffrey Parker
-------------------
Jeffrey Parker
Chairman and Chief Executive Officer
August 13, 1998 By: /s/ Cynthia Poehlman
---------------------
Cynthia Poehlman
Chief Accounting Officer
15
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> JUN-30-1998
<CASH> 2,936,072
<SECURITIES> 17,959,516
<RECEIVABLES> 1,559,382
<ALLOWANCES> 32,383
<INVENTORY> 3,800,345
<CURRENT-ASSETS> 27,138,860
<PP&E> 5,753,719
<DEPRECIATION> 2,838,034
<TOTAL-ASSETS> 36,313,389
<CURRENT-LIABILITIES> 1,320,898
<BONDS> 0
114,042
0
<COMMON> 0
<OTHER-SE> 34,873,771
<TOTAL-LIABILITY-AND-EQUITY> 36,313,389
<SALES> 4,554,775
<TOTAL-REVENUES> 4,554,775
<CGS> 2,824,986
<TOTAL-COSTS> 2,824,986
<OTHER-EXPENSES> 5,320,819
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (2,797,329)
<INCOME-TAX> 0
<INCOME-CONTINUING> (2,797,329)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,797,329)
<EPS-PRIMARY> (0.25)
<EPS-DILUTED> (0.25)
</TABLE>
