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 quarterly period ended March 31, 1999 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 0-26548
Legal Research Center, Inc.
(Exact Name of Registrant as Specified in its Charter)
Minnesota 41-1680384
(State Or Other Jurisdiction (IRS Employer Identification No.)
Of Incorporation)
700 Midland Square Building, 331 Second Avenue So., Minneapolis, MN 55401
(Address Of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: 612/332-4950
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 CORPORATE ISSUERS)
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date.
3,334,133 shares of Common Stock as of March 31, 1999
<PAGE>
INDEX
PART I. FINANCIAL INFORMATION Page
Item 1. Financial Statements:
Consolidated Balance Sheets
March 31, 1999 and December 31, 1998 .............................2
Consolidated Statements of Operations
Three Months Ended March 31, 1999 and 1998.......................3
Consolidated Statements of Stockholders' Equity ....................4
Consolidated Statements of Cash Flows
Three Months Ended March 31, 1999 and 1998.......................5
Notes to Consolidated Financial Statements .........................6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations .......................................6
PART II. OTHER INFORMATION
Item 1. Legal Proceedings...................................................8
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
LEGAL RESEARCH CENTER, INC.
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
(Unaudited)
March 31, December 31,
ASSETS 1999 1998
==========================================================================================================
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 559,579 $ 436,110
Accounts receivable 444,359 457,723
Note receivable 30,909 30,909
Other 62,267 33,121
----------- -----------
TOTAL CURRENT ASSETS 1,097,114 957,863
----------- -----------
FURNITURE AND EQUIPMENT 342,067 342,067
Less accumulated depreciation (308,733) (298,340)
----------- -----------
33,334 43,727
----------- -----------
OTHER ASSETS
Notes receivable, net of $153,974 allowance for doubtful accounts 50,050 50,050
Intangible assets 206,795 232,645
----------- -----------
256,845 282,695
----------- -----------
$ 1,387,293 $ 1,284,285
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
==========================================================================================================
CURRENT LIABILITIES
Accounts payable $ 46,414 $ 44,235
Accrued expenses:
Compensation 80,627 80,990
Other 5,681 3,155
Client Advances 35,408 17,477
----------- -----------
TOTAL CURRENT LIABILITIES 168,130 145,857
----------- -----------
NOTES PAYABLE $ 200,000 $ 200,000
STOCKHOLDERS' EQUITY
Common stock, $0.01 par value; (authorized 20,000,000 shares;
issued - 3,334,133 and 3,327,633 shares respectively) 33,341 33,276
Additional paid-in capital 6,871,654 6,870,007
Accumulated deficit (3,919,582) (3,998,605)
Notes receivable from officers and directors (1,966,250) (1,966,250)
----------- -----------
1,019,163 938,428
----------- -----------
$ 1,387,293 $ 1,284,285
=========== ===========
</TABLE>
See Notes to Consolidated Financial Statements (unaudited)
<PAGE>
LEGAL RESEARCH CENTER, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months
Ended March 31,
-----------------------------
1999 1998
-----------------------------
REVENUES $ 819,671 $ 446,409
----------- -----------
DIRECT OPERATING COSTS
Compensation and benefits 307,695 154,599
Other 85,276 61,284
----------- -----------
Total direct operating costs 392,971 215,883
----------- -----------
GROSS PROFIT 426,700 230,526
----------- -----------
OTHER OPERATING COSTS
Sales and marketing 182,055 272,354
General and administrative 166,770 64,527
----------- -----------
Total other operating costs 348,825 336,881
----------- -----------
INCOME (LOSS) FROM OPERATIONS 77,875 (106,355)
----------- -----------
OTHER INCOME (EXPENSE)
Interest Income 6,080 2,004
Interest Expense (4,932) (127)
NET INCOME (LOSS) $ 79,024 $ (104,478)
=========== ===========
=========== ===========
NET INCOME (LOSS) PER COMMON SHARE $ 0.03 $ (0.05)
=========== ===========
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 2,279,133 2,272,633
----------- -----------
See Notes to Consolidated Financial Statements (unaudited)
<PAGE>
LEGAL RESEARCH CENTER, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
Common Stock Additional
--------------------------- Paid-in Accumulated Notes
Shares Amount Capital Deficit Receivable Total
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
BALANCE, DECEMBER 31, 1996 3,297,633 32,976 6,765,307 (1,988,841) (1,966,250) 2,843,192
Expiration on repurchase option
on common stock 30,000 300 104,700 105,000
Net Loss -- -- -- (2,065,004) -- (2,065,004)
----------- ----------- ----------- ----------- ----------- -----------
BALANCE, DECEMBER 31, 1997 3,327,633 33,276 6,870,007 (4,053,845) (1,966,250) 883,188
Net Income -- -- -- 55,240 -- 55,240
BALANCE, DECEMBER 31, 1998 $ 3,327,633 $ 33,276 $ 6,870,007 $(3,998,605) $(1,966,250) $ 938,428
----------- ----------- ----------- ----------- ----------- -----------
Net Income $ 79,024 $ 79,024
Exercised Stock Options $ 6,500 $ 65 $ 1,647 $ 1,712
BALANCE , MARCH 31, 1999 $ 3,334,133 $ 33,341 $ 6,871,654 $(3,919,582) $(1,966,250) $ 1,019,163
=============================================================================================
</TABLE>
See Notes to Consolidated Financial Statements (unaudited)
<PAGE>
LEGAL RESEARCH CENTER, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
(Unaudited)
Three Months Ended
March 31
-------------------------
1999 1998
-------------------------
<S> <C> <C>
OPERATING ACTIVITIES
Net profit (loss) $ 79,024 $(104,478)
Adjustments to reconcile net profit (loss) to net
cash used by operating activities:
Depreciation 10,393 23,027
Amortization and write-off of intangible assets and 25,850 3,431
capitalized development costs
(Gain) loss on disposal of furniture and equipment (50)
Change in assets and liabilities
Trade accounts receivable and unbilled services 13,364 (82,819)
Other current assets (29,146) (25,001)
Accounts payable 2,179 97,362
Accrued expenses 2,162 11,070
Client advances 17,931 15,770
--------- ---------
Net cash provided (used) in operating activities 121,757 (61,688)
--------- ---------
INVESTING ACTIVITIES
Proceeds from the sale of furniture and equipment 50
Capitalized development costs
Cash received on notes receivable 15,000
--------- ---------
Net cash provided (used) by investing activities 15,050
--------- ---------
FINANCING ACTIVITIES
Common Stock 65
Proceeds from exercise of stock options 1,647
--------- ---------
--------- ---------
Increase (Decrease) in cash and cash equivalents 123,469 (46,638)
--------- ---------
Cash and cash equivalents
Beginning of period 436,110 165,924
--------- ---------
End of period $ 559,579 $ 119,286
========= =========
</TABLE>
<PAGE>
LEGAL RESEARCH CENTER, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1999
(unaudited)
Basis Of Presentation: The interim financial statements are unaudited, but in
the opinion of management reflect all adjustments necessary for a fair
presentation of results of such periods. All such adjustments are of a normal
recurring nature. The results of operations for any interim period are not
necessarily indicative of results for a full fiscal year. These financial
statements should be read in conjunction with the audited financial statements
and notes thereto, for the year ended December 31, 1998.
Principles Of Consolidation: The consolidated financial statements include the
accounts of the Company and its wholly-owned subsidiary, The Law Office, Inc.
(TLO) and its eighty-five percent owned subsidiary, The CyberLaw Office, Inc.
(CLO). All significant inter company accounts and transactions have been
eliminated.
Use Of Estimates: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
Net Gain (Loss) Per Common Share: Net gain (loss) per common share is computed
on the basis of the weighted average number of common shares outstanding during
the respective periods.
Major Customers: Two customers accounted for 49%, and 15.7% respectively, of the
Company's total revenues for the quarter ended March 31, 1999. One of these
customers accounted for 30.7% of the Company's total revenues for the quarter
ended March 31, 1998.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion and analysis provides information that the Company's
management believes is relevant to an assessment and understanding of the
Company's results of operations and financial condition. This discussion should
be read in conjunction with the financial statements and footnotes which appear
elsewhere in this Report and the Company's annual report for 1998 on Form
10-KSB.
In connection with the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, the Company cautions readers that statements
contained herein, other than historical data, may be forward-looking and subject
to risk and uncertainties including, but not limited to the continuation of
revenues through the Company's strategic alliances and the successful
development of other new business. The following important factors could cause
the Company's actual results to differ materially from those projected in
forward-looking statements made by or on behalf of, the Company:
o Failure of the Company or its partners to successfully expand its
market share and sell products and services.
o Company's inability to produce and deliver its products and services
at margins sufficient to cover operating costs.
o Company's inability to continue operating due to insufficient cash or
capital and continued losses.
o Company's dependence on a major customer or customers.
o Effectiveness of restructuring and cost cutting measures implemented
in 1997 and 1998 by the Company to increase its gross margin and
decrease sales and general and administrative expenses.
<PAGE>
In addition, as a result of the delisting of the Company's common stock from the
Nasdaq SmallCap Market, described below, investors may suffer a loss of
liquidity in the shares and the Company may have difficulty raising funds in the
capital markets. Although the Company anticipates that its common stock will
trade on the Nasdaq "bulletin board" or in the local over-the-counter market,
there can be no assurance that such a market will develop or be maintained.
The Company's revenues have historically been derived from conducting analytical
research and writing on a non-recurring basis for its customers. Historically,
the Company has experienced a seasonal fluctuation in revenues with second and
third quarters being the slowest quarters of the year and the last quarter being
the strongest. The Company has developed and implemented programs designed to
attract customers to enter into long term relationships to provide greater
consistency in quarterly revenues.
RESULTS OF OPERATIONS
Revenues: Revenues increased by $373,262 or 83.6%, to $819,671 for the three
month period ended March 31, 1999, over the same period of 1998. The increase is
primarily attributable to an increase in traditional research and writing
services and document retrieval revenues offset by a decrease in
multi-jurisdictional survey revenue.
Direct Operating Costs: Direct operating costs for compensation and other
benefits include hourly contract fees for independent research attorneys as well
as salaries and hourly compensation of staff research attorneys, document
production and support personnel. Other direct operating costs include outside
research fees and services, royalty fees for association referrals, computer
database charges, project data conversion fees, photocopying, and document
retrieval expense.
Total direct operating costs increased $177,088, or 82%, for the three months
ended March 31, 1999, from the same period in 1998. The increase in operating
costs is due to the increase in revenue.
Direct operating costs, expressed as a percentage of revenues decreased slightly
from 48.4% to 47.9% for the three months ended March 31, 1999, from the same
period in 1998.
Gross Profit: Gross profit for the three months ended March 31, 1999, increased
by $196,174 or 85% to $426,700 from gross profits of $230,526 for the comparable
period for 1998. As a percentage of revenue, gross profit remained the same at
52% for the three months ended March 31, 1999, and for the same period in 1998,
primarily as a result of the continued control of direct operating costs.
Other Operating Costs: Other operating costs include compensation of officers,
sales and corporate staff, advertising and direct marketing expenditures and
general corporate overhead, including depreciation. Other operating costs
increased by $11,944 or 3.6% for the three months ended March 31, 1999, from the
same period in 1998. Of these other operating costs, sales and marketing
expenses decreased by $90,299, or 33.16% and general and administrative costs
increased by $102,243 or 158.4%. The increase in other operating costs is
primarily due to the amortization of capitalized development costs which started
in second quarter of 1998. The change in Sales and Marketing costs and General
and Administrative costs is due to a reclassification of expenses.
Other Income and Expense: Interest income increased $4,076 for the three months
ended March 31, 1999, from the comparable period in 1998. The increase is a
result of increased cash invested in interest bearing accounts. Interest expense
increased $4,805 for the three months ended March 31, 199 from the comparable
periods in 1998. The increase was a result of interest expense on convertible
notes received in 1998.
Net Profit/Loss: The Company posted a net profit of $79,024 or $.03 per share
for the three months ended March 31, 1999, compared to a loss of $104,478 or
$.05 per share for the comparable period in 1998. The increase in the revenue
per share was the result of an 83.6% increase in revenues offset by a 82%
increase in direct operating costs, and a 3.6% increase in general and
administrative expenses.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 1999, the Company had cash and cash equivalents of $559,579 and
working capital of $812,006.
Cash generated in operating activities was $121,757 in the first three months of
1999. This was primarily the result of a $115,267 net gain before depreciation
and other non-cash charges, a $13,364 increase in accounts receivable and
unbilled services, offset by a $2,179 increase in accounts payable.
There were no investing activities in first quarter 1999.
The Company received $1,712 in financing activities due to the proceeds from the
exercise of stock options.
Part II - Other Information
Item 1. Legal Proceedings
LAWFINDERS LITIGATION
On June 29, 1998, the Company was sued in Dallas, Texas by Lawfinders, Inc.
("Lawfinders"), a competitor of the Company, which alleged that the Company had
misappropriated Lawfinders's proprietary information. Lawfinders sought
injuctive relief and unspecified damages
Commencing in the summer of 1997 and ending in early 1998, the Company was
engaged in discussions with Lawfinders about a possible business combination.
Those discussions failed to produce an agreement between the parties.
Lawfinders commenced suit in state court and obtained a temporary restraining
order restraining the Company from engaging in certain practices in connection
with its appellate brief business. The Company removed the action to federal
court and, on November 4, 1998, after consideration of the evidence and the
parties' briefs, the federal court dissolved the temporary restraining order and
found that because it is unlikely that Lawfinders would be successful on the
merits of its action, denied Lawfinders a preliminary injunction.
The Company believes that it will prevail in the litigation, should it continue.
The Company's also believes that its costs of defending the action, including
attorneys' fees, are covered by the Company's general liability insurance
carrier and the Company believes that all future costs of defending the
litigation, if any, will be similarly covered.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
LEGAL RESEARCH CENTER, INC.
Dated: May 12, 1999 By: /s/ Christopher R. Ljungkull
-----------------------------
Christopher R. Ljungkull
Chief Executive Officer
<PAGE>
NEWS RELEASE
Media Contacts: Christopher Ljungkull Daryn Teague
Legal Research Center Teague Communications
(800) 776-9377 (661) 297-5292
[email protected] [email protected]
Legal Research Center Announces First Quarter
1999 Revenues Increased by 84%
Minneapolis - 30 April 99 - Legal Research Center, Inc. (OTC: LRCI), one of the
nation's leading providers of outsourced legal research and writing services,
today reported its results for the first quarter ended March 31, 1999.
For the quarter, revenues increased 84% to $820,000, compared to $446,000
for the first quarter of 1998. EBITDA (earnings before interest, taxes,
depreciation and amortization) were $114,345 for the first quarter or $.05 per
share. Net income was $79,000, or $.03 per share, compared to a net loss of
$104,000, or ($.05) per share in the prior year's period.
According to Christopher Ljungkull, Chief Executive Officer of LRC, "The
net profit posted in the first quarter was accomplished by three factors. First,
we generated substantially more revenue in the quarter by focusing all of our
energies on our core business of legal research and writing services - and we
expect continued growth. Second, we were able to maintain a gross margin in
excess of 50 percent for the quarter. While a 52% gross margin is excellent, we
believe it can be increased over time. Third, we limited the growth in the
company's general and administrative expenses to just four percent through a
very cautious downsizing of the company's infrastructure. This process has been
extremely successful and we expect the trend to continue. In
<PAGE>
the last three quarters we have increased revenue 165% over the same three
quarters a year ago, and improved the bottom line from a loss of $.11 per share
to a profit of $.05 per share."
"LRC's second quarter also looks very promising," said James Seidl, LRC's
President. "In fact I believe the growth we're experiencing is just the
beginning. In my 21 years in this business I've never met such broad and
enthusiastic receptivity for the services and products offered by LRC."
LRC has been in the news recently with a series of announcements, including
a 4-year exclusive contract with the American Corporate Counsel Association; a
private investment by prominent Twin Cities investors Vance Opperman and Kenneth
Merrill; and the addition of Bruce Aho, the former President and CEO of the
Quorum Group, to LRC's Board of Directors. Earlier this month, LRC also
announced the introduction of an enhanced appellate brief service that offers a
100% money-back guarantee that the lawyer using the service will win his or her
case.
Minneapolis-based Legal Research Center (http://www.lrci.com) offers legal
research and writing services to attorneys in corporate and private practice
throughout the world. Founded in 1978, LRC's work products include
multijurisdictional surveys, office memoranda, and formal court-ready documents
such as trial and appellate briefs, prepared by a staff of highly credentialed
attorneys, carefully selected for their research, analytical, writing and
client-service skills. LRC's research attorneys are honors graduates who have
practiced law for at least two years, and many for over 20, in major law firms
and corporate law departments throughout the United States.
# # #
<PAGE>
LEGAL RESEARCH CENTER, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
Three Months
Ended March 31,
-------------------------------
1999 1998
-------------------------------
Revenues $ 819,671 $ 446,409
Operating (loss) income 77,875 (106,355)
Net loss $ 79,024 $ (104,478)
Net loss per share $ 0.03 $ (0.05)
Weighted average common and common
equivalent shares outstanding 2,292,568 2,272,633
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
March 31,
1999
-----------
Current assets $ 1,097,114
Furniture & equipment, net 33,334
Other assets 256,845
Total assets $ 1,387,293
Current liabilities $ 168,130
Long-term liabilities 200,000
Stockholders' equity 1,019,163
Total liabilities and shareholders' equity $ 1,387,293
<PAGE>
Media Contacts:
Christopher Ljungkull, CEO Daryn Teague
Legal Research Center, Inc. Teague Communications
800.776.9377 or [email protected] (805) 297-5292 or [email protected]
Legal Research Center Announces Private Investment from Kenneth Merrill and
Vance Opperman
MINNEAPOLIS -- February 25, 1999 -- Legal Research Center, Inc. (OTC:LRCI)
announced today that it secured a private investment in 1998 for increased
marketing, sales and expansion activities from prominent Twin Cities investors
Kenneth Merrill and Vance Opperman. The company stated the financing was
structured as convertible debt.
Vance Opperman, president of Key Investment, commented, "One of the more
interesting trends in law practice management today is strategic outsourcing.
While still in its infancy, outsourced legal research is rich with opportunity
and growth potential. Committed to service excellence and innovation, Legal
Research Center is leading the way in this small but growing market niche."
The company recently announced a record 15% third quarter profit and a 93%
increase in third quarter revenues. According to Christopher Ljungkull, CEO of
Legal Research Center (LRC), "We are aggressively expanding our marketing and
sales activities to capitalize on our profession's growing receptivity for
outsourced legal research. This infusion of capital helps LRC expand its core
research business and leverage our unique collection of strategic alliances and
client-partnering relationships."
Kenneth Merrill is founder and former Chairman of the Board of Merrill
Corporation, a leading financial printing and document management business
headquartered in St. Paul. Vance Opperman is President and CEO of
Minneapolis-based Key Investment, Inc. and former
<PAGE>
President of West Publishing Company of Eagan.
According to James Seidl, president of LRC, "The support and encouragement
received from these two business leaders have been very gratifying. Fortune 100
companies and prestigious national law firms are discovering the value of
outsourcing their research to LRC. This investment will help us spread the word
that LRC delivers a better way to research the law."
Minneapolis-based Legal Research Center (http://www.lrci.com), offers legal
research and writing services to attorneys in corporate and private practice
throughout the world. Founded in 1978, LRC's work products include electronic
knowledgebases and multijurisdictional surveys, office memoranda, and formal
court-ready documents such as trial and appellate briefs, prepared by a staff of
highly credentialed attorneys, carefully selected for their research,
analytical, writing and client-service skills. LRC's research attorneys are
honors graduates who have practiced law for at least two years, and some for
over twenty, in major law firms and corporate law departments throughout the
U.S.
<PAGE>
FOR IMMEDIATE RELEASE
March 4, 1999
Media Contacts:
Christopher Ljungkull, CEO Daryn Teague
Legal Research Center, Inc. Teague Communications
800.776.9377 805.297.5292
[email protected] [email protected]
BRUCE AHO JOINS LEGAL RESEARCH CENTER'S
BOARD OF DIRECTORS
MINNEAPOLIS, MN. Legal Research Center, Inc. (LRCI) announced today that
prominent Minneapolis businessman Bruce J. Aho has joined LRC's Board of
Directors. He joins current LRC board members Arun Dube, Christopher Ljungkull
and James Seidl.
Bruce Aho is the former President and CEO of the Quorum Group, one of the
largest suppliers of litigation support document management services in the
country. In 1991, Aho led a group of investors that purchased Quorum Litigation
Services from Minneapolis-based Control Data, creating the Quorum Group. As
President and CEO, Aho directed the rapid geographic expansion of Quorum's
business operations, resulting in the opening of offices in over a dozen major
U.S. cities as well as London and Manila. During this period, Quorum added a
lawyer, paralegal and legal secretarial staffing division and expanded into the
image scanning services business. Under Aho's leadership, Quorum increased its
annual revenue by 400% during the period from 1991 to 1997. Lanier Worldwide,
Inc., a subsidiary of the Harris Corporation, acquired the private company in
1997.
Christopher Ljungkull, LRC's CEO, stated, "Bruce Aho is known in the legal
service industry for his remarkable success at Quorum. His sales ingenuity as
well as his passion for excellence, innovation, and business growth are traits
he intends to share with LRC as a very active board member. We are truly honored
by his decision to join LRC's board."
Since retiring from Quorum in 1998, Aho has studied the legal research industry,
LRC and its potential for growth. He commented, "Outsourced legal research is
one of the few remaining frontiers in the business of law. The opportunities for
innovation and growth are considerable. As the recognized industry leader, LRC
is well positioned for aggressive expansion, sustained profitability, and
continued core business revenue growth. I look forward to actively participating
in LRC's expansion plans in the months ahead."
Minneapolis-based Legal Research Center (http://www.lrci.com), offers legal
research and writing services to attorneys in corporate and private practice
throughout the world. Founded in 1978, LRC's work products include electronic
knowledgebases and multijurisdictional surveys, office memoranda, and formal
court-ready documents such as trial and appellate briefs, prepared by a staff of
highly credentialed attorneys, carefully selected for their research,
analytical, writing and client-service skills. LRC's research attorneys are
honors graduates who have practiced law for at least two years, and some for
over twenty, in major law firms and corporate law departments throughout the
United States.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM QUARTER
ENDED MARCH 31, 1999 FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 559,579
<SECURITIES> 0
<RECEIVABLES> 444,359
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,097,114
<PP&E> 342,067
<DEPRECIATION> 308,733
<TOTAL-ASSETS> 1,387,293
<CURRENT-LIABILITIES> 168,130
<BONDS> 0
0
0
<COMMON> 33,341
<OTHER-SE> 1,185,822
<TOTAL-LIABILITY-AND-EQUITY> 1,387,293
<SALES> 0
<TOTAL-REVENUES> 825,752
<CGS> 0
<TOTAL-COSTS> 392,971
<OTHER-EXPENSES> 348,825
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,932
<INCOME-PRETAX> 79,024
<INCOME-TAX> 0
<INCOME-CONTINUING> 79,024
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 79,024
<EPS-PRIMARY> .03
<EPS-DILUTED> .03
</TABLE>
