U. S. Securities and Exchange Commission
Washington, D. C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarter ended June 30, 1999
-------------
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
------------- -------------
Commission File No. 0-25631
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ALPHATRADE.COM
--------------
(Name of Small Business Issuer in its Charter)
NEVADA Applied For
------ -----------
(State or Other Jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
Suite 400, 1111 West Georgia Street
Vancouver, British Columbia, Canada V6E 4M3
-------------------------------------------
(Address of Principal Executive Offices)
Issuer's Telephone Number: (604) 681-7503
Check whether the Issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the Company was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
(1) Yes X No (2) Yes X No
--- --- --- ---
(ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PAST FIVE YEARS)
Check whether the issuer has filed all documents and reports required to
be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution
of securities under a plan confirmed by a court. Yes____ 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:
July 21, 1999
Common - 11,205,350 shares
DOCUMENTS INCORPORATED BY REFERENCE
NONE.
Transitional Small Business Issuer Format Yes X No
--- ---
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The Consolidated Financial Statements of the Company required
to be filed with this 10-QSB Quarterly Report were prepared by management and
commence on the following page, together with related Notes. In the opinion
of management, the Consolidated Financial Statements fairly present the
financial condition of the Company.
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Balance Sheets
<TABLE>
<CAPTION>
ASSETS
June 30, December 31,
1999 1998
(Unaudited)
<S> <C> <C>
CURRENT ASSETS
Cash $ 18,507 $ -
Prepaid expenses 6,755 -
Total Current Assets 25,262 -
FIXED ASSETS
Computer hardware 70,045 -
Office equipment and software 12,615 -
Accumulated depreciation (6,210) -
Total Fixed Assets 76,450 -
OTHER ASSETS
Technology - -
Total Other Assets - -
TOTAL ASSETS $ 101,712 $
</TABLE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Balance Sheets (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
(Unaudited)
<S> <C> <C>
CURRENT LIABILITIES
Accounts payable $ 75,140 $ 11,687
Accounts payable -
related parties 59,265 -
Total Current Liabilities 134,405 11,687
Total Liabilities 134,405 11,687
STOCKHOLDERS' EQUITY (DEFICIT)
Convertible preferred stock; par
value $0.001 per share; 10,000,000
shares authorized, 2,000,000 shares
issued and outstanding 2,000 -
Common stock: $0.001 par value,
100,000,000 shares authorized;
11,204,250, and 6,100,000 shares
issued and outstanding,
respectively 11,204 6,100
Additional paid-in capital 1,108,296 46,400
Common stock subscriptions
receivable (302,571) (50,000)
Accumulated deficit (851,622) (14,187)
Total Stockholders'
Equity (Deficit) (32,693) (11,687)
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ 101,712 $ -
</TABLE>
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
From
Inception on
For the For the June 6,
Six Months Ended Three Months Ended 1995 Through
June 30, June 30, June 30,
1999 1998 1999 1998 1999
<S> <C> <C> <C> <C> <C>
REVENUES $ 100,000 $ - $100,000 $ - $ 100,000
EXPENSES 937,435 - 369,885 - 951,622
NET LOSS $(837,435) $ - $(269,885) $ - $ (851,622)
BASIC LOSS PER SHARE
OF COMMON STOCK $ (0.07) $(0.00) $ (0.05) $(0.00)
FULLY DILUTED LOSS
PER SHARE $ (0.07) $(0.00) $ (0.05) $(0.00)
</TABLE>
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
From Inception on June 6, 1995 through June 30, 1999
<TABLE>
<CAPTION>
Preferred Stock Common Stock
Shares Amount Shares Amount
<S> <C> <C> <C> <C>
Balance at inception on
June 6, 1995 - $ - - $ -
Issuance of 6,000,000
shares of common stock
for cash at $0.0004 per
share on June 6, 1995 - - 6,000,000 6,000
Net loss from inception on
June 6, 1995 through
December 31, 1995 - - - -
Balance,
December 31, 1995 - - 6,000,000 6,000
Net loss for the year ended
December 31, 1996 - - - -
Balance,
December 31, 1996 - - 6,000,000 6,000
Net loss for the year ended
December 31, 1997 - - - -
Balance,
December 31, 1997 - $ - 6,000,000 $ 6,000
Balance,
December 31, 1997 - $ - 6,000,000 $ 6,000
Stock issued on
subscription for services
at $0.50 per share on
December 28, 1998 - - 100,000 100
Net loss for the year ended
December 31, 1998 - - - -
Balance,
December 31, 1998 - - 6,100,000 6,100
Stock issued for technology,
recorded at predecessor
cost, January 6, 1999 - - 4,000,000
Stock issued for services
at $0.50 per share on
January 6, 1999 - - 100,000 100
Stock issued on
subscription at $1.00 per
share, January 8, 1999 - - 1,000,000 1,000
Balance Forward - $ - 11,200,000 $ 11,200
Balance Forward - $ - 11,200,000 $ 11,200
Stock issued to founders
recorded at $0.001 which
approximates predecessor
cost, January 8, 1999 2,000,000 2,000 - -
Receipt of stock
subscription (unaudited) - - - -
Common stock issued for
cash (unaudited) - - 4,250 4
Net loss for the six
months ended
June 30, 1999
(unaudited) - - - -
Balance,
June 30, 1999
(unaudited) 2,000,000 $ 2,000 11,204,250 $ 11,204
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Additional
Paid-In Subscriptions Accumulated
Capital Receivable Deficit
<S> <C> <C>
Balance at inception on
June 6, 1995 $ - $ - $ -
Issuance of 6,000,000
shares of common stock
for cash at $0.0004 per
share on June 6, 1995 (3,500) - -
Net loss from inception on
June 6, 1995 through
December 31, 1995 - - (2,500)
Balance,
December 31, 1995 (3,500) - (2,500)
Net loss for the year ended
December 31, 1995 - - -
Balance,
December 31, 1996 (3,500) - (2,500)
Net Loss for the year ended
December 31, 1997 - - -
Balance,
December 31, 1997 (3,500) $ - (2,500)
Stock issued on
subscription for services
at $0.50 per share on
December 31, 1998 49,900 (50,000) -
Net loss for the year ended
December 31, 1998 - - (11,687)
Balance,
December 31, 1998 46,400 (50,000) (14,187)
Stock issued for technology
recorded at predecessor
cost, January 6, 1999 (4,000) - -
Stock issued for services
at $0.50 per share on
January 6, 1999 49,900 - -
Stock issued on
subscription at $1.00 per
share, January 8, 1999 999,000 (1,000,000) -
Stock issued to founders
recorded at $0.001 which
approximates predecessor
cost, January 8, 1999 - - -
Receipt of stock
subscription (unaudited) - 764,429 -
Common stock issued for
cash (unaudited) 16,996 (17,000) -
Net loss for the six
months ended June 30,
1999 (unaudited) - - (837,435)
Balance,
June 30, 1999
(unaudited) $1,108,296 $ (302,571) $(851,622)
</TABLE>
<PAGE>
<TABLE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Cash Flows
(unaudited)
<CAPTION>
From
Inception on
For the For the June 6,
Six Months Ended Three Months Ended 1995 Through
June 30, June 30, June 30,
1999 1998 1999 1998 1999
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES
Net loss $(837,435) $ - $(269,885) $ - $(851,622)
Adjustments to reconcile
net loss to net cash
provided (used) by
operating activities:
Common stock issued
for services 50,000 - - - 50,000
Preferred stock issued
for services 2,000 - - - 2,000
Depreciation expense 6,210 - 4,133 - 6,210
Changes in operating
assets and liabilities:
(Increase) decrease
in prepaid expenses (6,755) - (6,550) - (6,755)
Increase (decrease)
in accounts payable 63,453 - (22,983) - 75,140
Net Cash Used by
Operating Activities (722,527) - (295,285) - (725,027)
CASH FLOWS FROM INVESTING
ACTIVITIES
Purchase of fixed assets (82,660) - (14,560) - (82,660)
Net Cash Used by
Investing Activities (82,660) - (14,560) - (82,660)
CASH FLOWS FROM FINANCING
ACTIVITIES
Payments to related
parties (50,648) - (50,648) - (50,648)
Proceeds from related
parties 126,913 - - - 126,913
Common stock issued
for cash 747,429 - 379,000 - 749,929
Net Cash Provided by
Financing Activities 823,694 - 328,352 - 826,194
NET CHANGE IN CASH 18,507 - 18,507 - 18,507
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD - - - - -
CASH AND CASH
EQUIVALENTS AT END
OF PERIOD $ 18,507 $ - $ 18,507 $ - $ 18,507
SUPPLEMENTAL DISCLOSURE
OF CASH FLOW INFORMATION
Interest paid $ - $ - $ - $ - $ -
Income taxes paid $ - $ - $ - $ - $ -
SCHEDULE OF NON-CASH
FINANCING ACTIVITIES:
Common stock issued
for services $ 50,000 $ - $ - $ - $50,000
Preferred stock issued
for services $ 2,000 $ - $ - $ - $ 2,000
</TABLE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Notes to the Financial Statements
June 30, 1999 and December 31, 1998
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Organization
AlphaTrade.com was incorporated under the laws of the State of
Nevada on June 6, 1995. The Company has been in the development
stage since incorporation.
b. Accounting Method
The Company's financial statements are prepared using the accrual
method of accounting.
c. Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid investments
with maturities of three months or less at the time of
acquisition.
d. Basic Loss Per Share
The computations of basic loss per share of common stock are based
on the weighted average number of shares outstanding at the date
of the financial statements.
e. Provision for Taxes
At June 30, 1999, the Company had net operating loss carryforwards
of approximately $852,000 that may be offset against future
taxable income through 2014. No tax benefit has been reported in
the financial statements, because the Company believes there is a
50% or greater chance the carryforward will expire unused.
Accordingly, the potential tax benefits of the loss carryforward
are offset by a valuation amount of the same amount.
f. Additional Accounting Policies
Additional accounting policies will be established once planned
principal operations commence.
g. Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Notes to the Financial Statements
June 30, 1999 and December 31, 1998
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
h. Unaudited Financial Statements
The accompanying unaudited financial statements include all of the
adjustments which, in the opinion of management, are necessary for
a fair presentation. Such adjustments are of a normal, recurring
nature.
NOTE 2 - CONVERTIBLE PREFERRED STOCK
The Company has 2,000,000 outstanding shares of convertible Class
"A" preferred stock with the following features:
* Each preferred share is convertible into five underlying common
shares at a conversion price of $0.05 per common share.
* Each holder of Class "A" preferred shares shall be entitled to
five (5) votes (which can be voted prior to conversion) for
every preferred share held to vote on any matters brought
before the shareholders of the Company.
* The preferred shares are assignable.
* The preferred shares vet immediately to the holder upon
issuance and cannot be canceled.
NOTE 3 - ACCOUNTS PAYABLE - RELATED PARTIES
The Company owes $59,265 to related parties for accrued salaries
and other expenses incurred on the Company's behalf. The accounts
payable is non-interest bearing, unsecured and due on demand.
Item 2. Management's Discussion and Analysis or Plan of Operation.
Plan of Operation.
- ------------------
The Company will need to raise additional capital in the next six
months to satisfy all of its cash requirements for the marketing of its
browser technologies. This will take the form of an equity issue of stock or
payments for licensing our technology to various companies. The Company is in
negotiations with several companies with respect to the licensing the
proprietary technology and expects to complete on some of these agreements
during the second and third quarters. While good progress was made during
this time on the development of the technology, there are a number of
uncertainties facing the Company for the balance of the year. The information
technology industry is fiercely competitive and the Company needs to devote
its time exclusively to ensuring that the development of our browser
technologies is on target with our marketing plans.
Results of Operations.
- ----------------------
At June 30, 1999, the Company had $18,507 in cash and $101,712 in
assets and $134,405 in liabilities. The Company had $100,000 in revenues for
the three months ended June 30, 1999 and no revenues for the three months
ended June 30, 1998, with $369,885 and $0 in expenses, for net losses of
($269,885) and $0, respectively.
Liquidity
- ---------
The Company reported $100,000 revenues for this period and the
outlook is for expenses to escalate as the need for capital expenditures,
research and development staff continues. It is anticipated that revenues
will not be significant until the latter part of 1999 and into the year 2000.
Year 2000.
- ---------
Because the Company is not presently engaged in any substantial
business operations, management does not believe that computer problems
associated with the change of year to the year 2000 will have any material
effect on its operations. However, the possibility exists that the Company
may merge with or acquire a business that will be negatively affected by the
"year 2000" problem. The effect of such problem or the Company in the future
can not be predicted with any accuracy until such time as the Company
identifies a merger or acquisition target.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
On June 8th, 1999, AlphaTrade.com was named as a defendant in a
Complaint filed in the District Court, Clark County, Nevada by WebData Corp.
and two of its shareholders. The Complaint alleges that AlphaTrade.com and
the other Defendants infringed upon trade secrets and other intellectual
property belonging to WebData. The Complaint also alleges that WebData was
deprived of certain corporate opportunities. Damages and declaratory relief
were requested.
AlphaTrade believes that the alleged technology described by WebData
in its Complaint is either in the public domain or uses rudimentary parsing
technology. Thus, AlphaTrade did not deprive WebData of any corporate
opportunity. AlphaTrade will vigorously defend this position and the Company
does not believe that the WebData lawsuit will have a material effect on
business. An 8-K Current Report dated June 16, 1999, was filed by the Company
with the Securities and Exchange Commission on June 25, 1999, respecting this
proceeding, and is incorporated herein by reference.
Item 2. Changes in Securities.
None; not applicable.
Item 3. Defaults Upon Senior Securities.
None; not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
None; not applicable.
Item 5. Other Information.
None; not applicable.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
None.
(b) Reports on Form 8-K.
8-K Current Report dated June 16, 1999, was filed by the
Company with the Securities and Exchange Commission on June 25, 1999.
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.
ALPHATRADE.COM
Date: 8/13/99 By/s/Victor D. Cardenas
------- --------------------------------------
Victor D. Cardenas
President and Director
Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, this Report has been signed below by the following persons on
behalf of the Company and in the capacities and on the dates indicated:
ALPHATRADE.COM
Date: 8/13/99 By/s/Victor D. Cardenas
-------- ------------------------------------
Victor D. Cardenas
President and
Director
Date: 8/13/99 By/s/J. Michael Pinkney
-------- ------------------------------------
J. Michael Pinkney
Secretary/Treasurer and Director
Date: 8/13/99 By/s/Rafael DeNoyo
-------- ------------------------------------
Rafael DeNoyo
Director
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 18507
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 25262
<PP&E> 82660
<DEPRECIATION> 6210
<TOTAL-ASSETS> 101712
<CURRENT-LIABILITIES> 134405
<BONDS> 0
0
2000
<COMMON> 11204
<OTHER-SE> (45897)
<TOTAL-LIABILITY-AND-EQUITY> 101712
<SALES> 0
<TOTAL-REVENUES> 100000
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 937435
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (837435)
<INCOME-TAX> 0
<INCOME-CONTINUING> (837435)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (837435)
<EPS-BASIC> (0.07)
<EPS-DILUTED> (0.07)
</TABLE>
