UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
X Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 For the period ended June 30, 1998.
OR
Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934Commission File Number: 0-25678
MUSTANG SOFTWARE, INC.
(Exact name of registrant as specified in its charter)
California
(State of incorporation)
77-0204718
(I.R.S. employer
identification number)
6200 Lake Ming Road
Bakersfield, California 93306
(Address of principal executive offices)
(805) 873-2500
(Registrant's telephone number, including area code)
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
As of August 7, 1998, there were 3,452,365 shares of the Registrant's
Common Stock outstanding.
===============================================================================
<PAGE> 2
MUSTANG SOFTWARE, INC.
FORM 10-QSB
INDEX
Page
PART I. Financial Information:
Balance Sheets as of June 30, 1998 and December 31, 1997 3
Statements of Operations for the three and six months
ended June 30, 1998 and 1997 4
Statements of Cash Flows for the six months ended
June 30, 1998 and 1997 5
Notes to Financial Statements 6
Management's Discussion and Analysis of Financial Condition
and Results of Operations 7
PART II. Other Information:
Item 2. Changes in Securities and Use of Proceeds 9
Item 4. Submission of Matters to a Vote of Security Holders 11
Item 5. Other Information. 11
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 13
============================================================================
<PAGE> 3
<TABLE>
MUSTANG SOFTWARE, INC.
BALANCE SHEETS
ASSETS
<CAPTION>
June 30, December 31
1998 1997
(Unaudited)
<S>
CURRENT ASSETS: <C> <C>
Cash and cash equivalents $ 697,319 $ 1,403,776
Accounts receivable, net of allowance for doubtful 135,349 6,378
accounts of $160,000 December 31, 1997 and
June 30,1998
Income taxes receivable -- 97,004
Inventories 31,188 99,915
Other 82,539 28,215
- -------------------------------------------------------------------------------
Total current assets 946,395 1,635,288
- -------------------------------------------------------------------------------
PROPERTY AND EQUIPMENT:
Property and equipment 1,251,062 1,238,713
Accumulated depreciation (596,261) (527,279)
- -------------------------------------------------------------------------------
Net property and equipment 654,801 711,434
- -------------------------------------------------------------------------------
OTHER ASSETS:
Capitalized software development costs, net 3,381 4,083
Other 100 --
- -------------------------------------------------------------------------------
Total other assets 3,481 4,083
- -------------------------------------------------------------------------------
$1,604,677 $2,350,805
===============================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $158,190 $242,451
Accrued payroll and liabilities 167,080 217,318
Income taxes payable 99,776 --
Accrued warranty and support 45,000 45,000
Deferred revenue 80,000 80,000
- -------------------------------------------------------------------------------
Total current liabilities 550,046 584,769
- -------------------------------------------------------------------------------
CAPITAL LEASE OBLIGATION, net of current portion 235,734 269,005
- -------------------------------------------------------------------------------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, no par value:
Authorized--10,000,000 shares
None issued or outstanding -- --
Common stock, no par value:
Authorized--30,000,000 shares
Issued and outstanding--3,417,961 and 3,451,365 6,708,948 6,640,045
shares at December 31,1997 and June 30, 1998,
respectively
Retained earnings (5,890,051) (5,143,014)
- -------------------------------------------------------------------------------
Total shareholders' equity 818,897 1,497,031
- -------------------------------------------------------------------------------
$1,604,677 $2,350,805
===============================================================================
The accompanying notes are an integral part of these financial statements.
</TABLE>
===============================================================================
<PAGE>4
<TABLE>
MUSTANG SOFTWARE, INC.
STATEMENTS OF OPERATIONS
<CAPTION>
Three Months Ended June 30, Six Months Ended June 30,
1998 1997 1998 1997
<S> <C> <C> <C> <C>
REVENUE $ 404,158 $ 458,129 $ 802,638 $ 1,258,050
COSTS OF REVENUE 33,439 92,498 99,848 214,864
- ----------------------------------------------------------------------------------------------
Gross profit 370,719 365,631 702,790 1,043,186
- ----------------------------------------------------------------------------------------------
OPERATING EXPENSES:
Research and development 147,524 170,902 301,577 342,109
Selling and marketing 223,075 205,953 470,093 534,393
General and administrative 306,713 363,057 687,523 784,920
- ----------------------------------------------------------------------------------------------
Total operating expenses 677,312 739,912 1,459,193 1,661,422
- ----------------------------------------------------------------------------------------------
Income(loss)from operations (306,593) (374,281) (756,403) (618,236)
- ----------------------------------------------------------------------------------------------
OTHER INCOME (EXPENSE):
Interest expense (7,766) (9,341) (15,941) (19,051)
Interest income 11,674 27,068 26,107 63,721
Gaine/Loss on sale of asset -- -- -- --
- ----------------------------------------------------------------------------------------------
Total other income (exp). 3,908 17,727 10,166 44,670
- ----------------------------------------------------------------------------------------------
Income (loss) before
provision for income taxes (302,685) (356,554) (746,237) (573,566)
PROVISION (BENEFIT)
FOR INCOME TAXES 800 800 800 800
- ----------------------------------------------------------------------------------------------
NET INCOME (LOSS) $ (303,485) $ (357,354) $ (747,037) (574,366)
==============================================================================================
NET INCOME (LOSS)
PER COMMON SHARE $ (.09) $ (.11) $ (.22) $ (.17)
==============================================================================================
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 3,451,365 3,383,694 3,434,663 3,379,330
==============================================================================================
The accompanying notes are an integral part of these financial statements.
</TABLE>
===============================================================================
<PAGE>5
<TABLE>
MUSTANG SOFTWARE, INC.
STATEMENTS OF CASH FLOWS
<CAPTION>
Six Months Ended June 30,
1998 1997
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income(loss) $ (747,037) $ (574,366)
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 69,684 75,342
Net changes in assets and liabilities (52,387) (355,242)
- -------------------------------------------------------------------------------
Net cash provided (used) by operating
activities (729,740) (854,266)
- -------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITES:
Purchase of property and equipment (12,349) --
- -------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of stock 68,903 5,564
Payments on capital lease obligation (33,271) (30,161)
- -------------------------------------------------------------------------------
Net Cash provided (used) by
financing activities 35,632 (24,597)
- -------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN CASH (706,457) (878,863)
CASH BALANCE, beginning of period 1,403,776 2,920,231
- -------------------------------------------------------------------------------
CASH BALANCE, end of period $ 697,319 $ 2,041,368
===============================================================================
SUPPLEMENTAL DISCLOSURES:
Interest paid 15,941 19,051
Taxes paid 800 800
The accompanying notes are an integral part of these financial statements.
</TABLE>
===============================================================================
<PAGE>6
MUSTANG SOFTWARE, INC.
NOTES TO FINANCIAL STATEMENTS
Note 1. Accounting Policies
The accompanying unaudited Condensed Financial Statements have been
prepared pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included in
annual financial statements prepared in accordance with generally accepted
accounting principles have either been condensed or omitted pursuant to those
rules and regulations. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. The results of operations and cash flows for
the periods presented are not necessarily indicative of the results that may
be expected for the full fiscal year. For further information, refer to the
financial statements and notes thereto for the year ended December 31, 1997,
included in the 1997 Form 10KSB.
The condensed Balance Sheet at December 31, 1997 has been taken from
the audited financial statements at that date and condensed.
===============================================================================
<PAGE>7
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
In addition to the comments that follow, further information can be
obtained by referring to the management's discussion and analysis of financial
condition and results of operations section included in the Form 10KSB, filed
for the year ended December 31, 1997.
Results of Operations:
Three Months Ended June 30, 1998 and 1997
Revenues for the three months ended June 30, 1998 were $404,158 a
decrease of $53,971 or 11.8% over revenues for the same period in 1997. As a
percentage of revenues by product category for the second quarter 1998 vs.
1997 showed the Web Essentials line at 63% and 1%, the QmodemPro line at 7%
and 9%, the Wildcat! line at 24% and 86%, and other products at 6% and 4%,
respectively. The increase in sales of the Web Essentials line was due to
increased acceptance of the Web Essentials products and the increase in
products from 1 in 1997 to 3 in 1998.
Gross profit for the quarter increased from $365,631 in 1997 to $370,719
in 1998, and increased as a percentage of revenues from 79.8% in 1997 to 91.7%
in 1998. Gross profit percentage has averaged approximately 80 to 84% over
the last three calendar years. The increase in gross profit percentage is due
mainly to the increase in average selling price of the Company's products and
maintaining the average cost per unit sold.
Research and development expenses decreased $23,378 in the second
quarter of 1998 from 1997, and decreased as a percentage of revenues from
37.3% in 1997 to 36.5% in 1998. Research and development is concentrated in
Windows NT and Windows 95 and directly targets the expanded use of
international networks, including the Internet. The Company has devoted and
is devoting a substantial portion of its research and development resources
to the Windows 95 and Windows NT environments and now offers a suite of Web
server and internet/intranet utility applications for Windows 95 and Windows
NT environments. The headcount in this department decreased from 10 at
June 30, 1997 to 8 at June 30, 1998. The headcount reduction accounts for the
majority of the decrease.
Selling and marketing expenses for the quarter were $223,075, an
increase of $17,122 over the same quarter the previous year, and they increased
as a percentage of revenues from 45.0% in 1997 to 55.2% in 1998. The items
primarily accounting for the increase were the advertising and promotional
costs for the new Web Essentials line of products and an increase in the
number of trade shows attended in 1998 as compared to 1997.
General and administrative expenses decreased for the 1998 quarter
compared to the previous year, from $363,057 in 1997 to $306,713 in 1998,
and decreased as a percentage of revenues, from 79.2% in 1997 to 75.9% in
1998. The items primarily accounting for the decrease were salaries and costs
associated with employee benefits. The General and administrative headcount
decreased 11% from the prior year.
===============================================================================
<PAGE>8
Six Months Ended June 30, 1997 and 1996
Revenues for the six months ended June 30, 1998 were $802,638, a decrease
of $455,412 or 36.2% over revenues for the same period in the prior year. As
a percentage of revenues by product category showed the Web Essentials line at
48% and 0%, the QmodemPro line at 8% and 13%, the Wildcat! line at 39% and
84%, and other at 5% and 3% for the first six months of 1998 and 1997,
respectively. The increase in sales of the Web Essentials line was due to
increased acceptance of the Web Essentials products and the increase in
products from 1 in 1997 to 3 in 1998.
Gross profit for the first six months decreased from $1,043,186 in 1997
to $702,790 in 1998, but increased as a percentage of revenues from 82.9% in
1997 to 87.6% in 1998. Gross profit percentage has averaged approximately 80
to 84% over the last three calendar years. The increase in Gross Profit
percentage from 1997 to 1998 is due mainly to the increase in sales of the
Web Essentials line. The Web Essentials line of products has higher average
selling prices and gross profit percentages than the Company's previous lines
of products.
Research and development expenses decreased $40,532 in the first six
months of 1998 from 1997, but increased as a percentage of revenues from
27.2% in 1997 to 37.6% in 1998. To maintain its competitive market position,
the Company expects to invest a significant amount of its resources for the
development of new products and product enhancements.
Selling and marketing expenses for the first six months of 1998
decreased $64,300 over the same period the previous year, from $534,393 to
$470,093. As a percentage of revenues selling and marketing expenses increased
from 42.5% in 1997 to 58.6% in 1998. The items primarily accounting for the
increase was the advertising and promotional costs for the new Web Essentials
line of products and an increase in the number of trade shows attended in
1998 as compared to 1997.
General and administrative expenses decreased $97,397 in the first six
months of 1998 from $784,920 in 1997 to $687,523 in 1998, but as a percentage
of revenues increased from 62.4% in 1997 to 85.7% in 1998. The items primarily
accounting for the decrease in actual dollars spent were due to reduction in
salaries and costs associated with employee benefits.
===============================================================================
<PAGE>9
Liquidity and Capital Resources
Cash and cash equivalents balance at June 30, 1998 were
approximately $697,000, a decrease of approximately $706,000 from December 31,
1997. Accounts receivable increased approximately $129,000 and Accounts
Payable decreased approximately $84,000 in 1998. Accounts receivable average
days to collect for the quarter ended June 30, 1997 and 1998 were 64 and 48
days, respectively. Average days to collect in 1997 were 64 days.
Management's goal is to maintain receivable collection days at or below 50
for 1998. Inventory levels have decreased approximately $69,000 in 1998 from
December 31, 1997. As well as accrued liabilities have decreased
approximately $50,000.
Longer term cash requirements, other than normal operating expenses,
are anticipated for development of new software products and enhancements of
existing products, launching new products and enhancements, financing
anticipated growth and the possible acquisition of businesses, software
products or technologies complementary to the Company's business.
The Company intends to meet its long-term liquidity needs through
available cash and cash flow as well as through financing from outside sources.
The Company is actively seeking to raise additional capital and has made
arrangements to raise funds through a private placement of securities that
will not be registered under the Securities Act of 1933 and may not be
offered or sold in the United States absent registration or an applicable
exemption from registration requirements. However, there can be no assurance
that the Company will be successful in completing the private placement or
otherwise raising additional capital. Further, there can be no assurance,
assuming the Company successfully raises additional funds, that the Company
will achieve profitability or positive cash flows. If the Company is not
successful in raising additional funds, it appears it will be forced to
further curtail the scope of its operations.
===============================================================================
<PAGE>10
<TABLE>
<CAPTION>
Part II. Other Information
Item 2. Changes in Securities and Use of Proceeds
(d)
(1) The effective date of the Securities Act registration statement for
which this use of proceeds information is being disclosed and the
Commission file number assigned to the registration statement is
April 5, 1995 and 2-89900-LA, respectively.
(2) The offering date was April 5, 1995.
(3) The offering did not terminate before any securities were sold.
(i) The offering has terminated but not before the sale of all
securities registered.
(ii) The name(s) of the managing underwriter(s) is Cruttenden Roth,
Incorporated.
(iii) The title of each class of securities registered is Common
Stock, no par value and Warrants to purchase Common Stock.
(iv) For each class of securities the following table provides
information for the account of the registrant and the selling
security holders with respect to the amount of the securities
registered, the aggregate price of the offering amount
registered, the amount sold and the aggregate offering
price of the amount sold to date:
For the account of the registrant For the account(s)of any
selling security holder(s)
<S>
Title Amount Aggregate Amount Aggregate Amount Aggregate Amount Aggregate
of registered price of sold offering registered price of Sold offering
Security offering price of offering price of
amount amount amount amount
registered sold registered sold
<C> <C> <C> <C> <C> <C> <C> <C> <C>
Common 1,250,000 $8,125,000 1,250,000 $8,125,000 187,500 $1,109,063 187,500 $1,109,063
Stock
Warrants 125,000 125 125,000 $125
- ------------------------------------------------------------------------------------------------------------
Total 1,375,000 $8,125,125 1,375,000 $8,125,125 187,500 $1,109,063 187,500 $1,109,063
============================================================================================================
(v) From April 5, 1995 (the effective date of the Securities Act
registration statement) to June 30, 1998 the following table
provides information as to the amount of expenses incurred for
the registrant's account in connection with the issuance and
distribution of the securities registered for underwriting
discounts and commissions, finders' fees, expenses paid to or
for underwriters, other expenses and total expenses were as
follows:
</TABLE>
==============================================================================
<PAGE>11
<TABLE>
<CAPTION>
Direct or indirect Direct or indirect
payments to directors payment to others
officers, general
partners of the
registrant or their
associated; to
persons owning ten
percent or more of
any class of equity
securities of the
registrant; and to
affiliates of the
registrant.
(A) (B)
<S> <C> <C>
(01)Underwriting
discounts and [ ]$ [ ]$ 731,250
commissions
(02)Finder's Fees [ ] [ ]
(03)Expenses paid to
or for underwriters [ ] [ ] 243,750
(04)Other expenses [ ] [ ] 565,315
(05)Total Expenses [ ] [ ]$ 1,540,315
(vi) The net offering proceeds to the registrant after deducting the
total expenses described in paragraph (f)(4)(v) of this Item was $6,584,810.
</TABLE>
==============================================================================
<PAGE>12
<TABLE>
<CAPTION>
(vii) From April 5, 1995 (the effective date of the Securities Act
registration statement) to June 30, 1998 the following table provides
information with respect to the amount of net offering proceeds to the
registrant used for construction of plant, building and facilities; purchase
and installation of machinery and equipment; purchases of real estate;
acquisition of other business(es); repayment of indebtedness;
working capital; temporary investments; and any other purposes for which at
least five (5) percent of the registrant's total offering proceeds or $100,000
(whichever is less) has been used:
Direct or indirect Direct or indirect
payments to directors payment to others
officers, general
partners of the
registrant or their
associated; to persons
owning ten percent or
more of any class of
equity securities of the
registrant; and to
affiliates of the
registrant.
(A) (B)
<S> <C> <C>
(01)Construction of
plant, building and [ ]$ [ ]$
facilities
(02)Purchase and
installation of [ ] [ ]
machinery and equipment
(03)Purchase of real [ ] [ ]
estate
(04)Acquisition of other
business(es) [ ] [ ]
(05)Repayment of
indebtedness [ ] [ ]
(06)Working capital [ ] 41,000 [ ] 767,850
Temporary investment (specify)
(07) [ ]$ [ ]$
(08) [ ] [ ]
(09) [ ] [ ]
(10) [ ] [ ]
Other purposes (specify)
(11)Advertising [ ]$ [ ]$ 873,787
(12)Marketing & Trade [ ] [ ] 3,086,062
(13)Research & [ ] [ ] 1,854,346
Development
(14) [ ] [ ]
(viii) The use of proceeds disclosed in paragraph (d)(3)(vii) of this Item did
not represent a material change in the use of proceeds described in the
prospectus.
</TABLE>
Item 4. Submission of Matters to a Vote of Security Holders
On June 8, 1998, registrant held its annual meeting of shareholders.
Each of thefollowing directors was elected by vote indicated after his
name:
NAME FOR WITHHELD
James A. Harrer 3,046,765 11,100
C. Scott Hunter 2,565,220 462,645
Stanley A. Hirschman 3,045,765 12,100
Michael S. Noling 3,046,765 11,100
Donald M. Leonard 3,045,765 12,100
To approve amendments to the Company's 1994 Incentive and Nonstatutory Stock
Option Plan to increase the total number of shares of Common Stock that can
be optioned and sold under the Stock Option Plan to 850,000 shares. The
following were the number of votes cast for, against or withheld, as well as
the number of abstentions and broker non-votes, as to such matter
FOR AGAINST ABSTAIN BROKER NON-VOTES
1,676,369 96,046 14,340 1,271,110
To approve an amendment to the Company's Employee Stock Purchase Plan to
increase by 50,000 shares the number of shares of Common Stock that may be
sold under the Employee Stock Purchase Plan. The following were the number of
votes cast for, against or withheld, as well as the number of abstentions and
broker non-votes, as to such matter
FOR AGAINST ABSTAIN BROKER NON-VOTES
1,771,698 82,374 13,235 1,190,558
To ratify the appointment of Arthur Andersen LLP as the Company's independent
accountants for the year ending December 31, 1998. The following were the
number of votes cast for, against or withheld, as well as the number of
abstentions and broker non-votes, as to such matter
FOR AGAINST ABSTAIN
3,044,785 7,065 6,015
Item 5. Other Information
Stockholders are hereby notified that if they wish to submit a proposal for
consideration at the Company's 1999 annual meeting of stockholders, but do
not wish to submit the proposal for inclusion in the Company's proxy statement
pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, they must
deliver a written copy of their proposal no later than April 2, 1999.
Proposals should be delivered to the Company's principal executive offices,
at 6200 Lake Ming Road, Bakersfield, California 93306 to the attention of
Mr. James A. Harrer, President. To avoid controversy and establish timely
receipt by the Company, it is suggested that stockholders send their proposals
by certified mail return receipt requested.
Item 6. Exhibits and Reports on Form 8-K
(a) Form 8-K. The Company filed one report on Form 8-K during the quarter ended
June 30, 1998. The report, dated June 1, 1998, reported information under
Item 5.
(b) Exhibits. The following exhibit is filed as a part of this Report.
Ex. 11 Computation of Earnings Per Share
Ex. 27 Financial Data Schedule.
===============================================================================
<PAGE>13
SIGNATURES
In accordance with the requirements of the Securities Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Signature Title Date
____________________
James A. Harrer President and Chief Executive August 12, 1998
Officer (Principal Executive
Officer) and a Director
____________________
Donald M. Leonard Vice President and Chief August 12, 1998
Financial Officer (Principal Financial
and Accounting Officer)
and a Director
<PAGE> 1 EXHIBIT 11.
MUSTANG SOFTWARE, INC.
COMPUTATION OF EARNINGS PER SHARE
(In thousands, except earnings per share) (Unaudited)
- - -----------------------------------------------------------------------------
<TABLE>
Three Months Ended Six Months Ended
June 30, June 30,
1998 1997 1998 1997
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Weighted average number of common shares outstanding 3,451 3,384 3,435 3,379
Common stock equivlents from outstanding stock options 0 0 0 0
- - --------------------------------------------------------------------------------------------
Average common and common stock equivalents outstanding 3,451 3,384 3,435 3,379
==============================================================================================
Net Income $(303) $ (357) $ (747) $ (574)
==============================================================================================
Earnings per share (1) $(.09) $ (.11) $ (.22) $ (.17)
==============================================================================================
</TABLE>
(1) Fully diluted earnings per share have not been presented because the effects
are not material.
- - -----------------------------------------------------------------------------
<TABLE> <S> <C>
<S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
ACCOMPANYING FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMETENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> $ 697,319
<SECURITIES> 0
<RECEIVABLES> 295,349
<ALLOWANCES> 160,000
<INVENTORY> 31,188
<CURRENT-ASSETS> 946,395
<PP&E> 1,251,062
<DEPRECIATION> 596,261
<TOTAL-ASSETS> 1,604,677
<CURRENT-LIABILITIES> 550,046
<BONDS> 235,734
0
0
<COMMON> 6,708,948
<OTHER-SE> (5,890,051)
<TOTAL-LIABILITY-AND-EQUITY> 1,604,677
<SALES> 802,638
<TOTAL-REVENUES> 802,638
<CGS> 99,848
<TOTAL-COSTS> 99,848
<OTHER-EXPENSES> 1,459,193
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 15,941
<INCOME-PRETAX> ( 746,237)
<INCOME-TAX> ( 747,037)
<INCOME-CONTINUING> ( 747,037)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> ( 747,037)
<EPS-PRIMARY> (.22)
<EPS-DILUTED> (.22)
</TABLE>
