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 September 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
-------
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
--- --- --- ---
(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:
September 30, 1999
Common - 11,654,250 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.
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
FINANCIAL STATEMENTS
September 30, 1999 and December 31, 1998
<PAGE>
<TABLE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Balance Sheets
<CAPTION>
ASSETS
September 30, December 31,
1999 1998
(Unaudited)
<S> <C> <C>
CURRENT ASSETS
Cash $ 57,687 $ -
Prepaid expenses 28,596 -
Total Current Assets 86,283 -
FIXED ASSETS
Computer hardware 104,127 -
Office equipment and furniture 8,080 -
Software 10,144 -
Accumulated depreciation (12,327) -
Total Fixed Assets 110,024 -
OTHER ASSETS
Investment 67,500 -
Technology - -
Total Other Assets 67,500 -
TOTAL ASSETS $ 263,807 $
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 52,638 $ 11,687
Accounts payable - related parties 38,962 -
Total Current Liabilities 91,600 11,687
Total Liabilities 91,600 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;
11,654,250, and 6,100,000 shares
issued and outstanding, respectively 11,654 6,100
Additional paid-in capital 2,007,846 46,400
Common stock subscriptions receivable (408,071) (50,000)
Other comprehensive loss (57,500) -
Accumulated deficit (1,383,722) (14,187)
Total Stockholders' Equity (Deficit) 172,207 (11,687)
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ 263,807 $ -
</TABLE>
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
For the For the
Nine Months Ended Three Months Ended
September 30, September 30,
1999 1998 1999 1998
<S> <C> <C> <C> <C>
REVENUES $ 125,000 $ - $ 125,000 $ -
EXPENSES 1,494,535 - 657,100 -
NET LOSS (1,369,535) - (532,100) -
OTHER COMPREHENSIVE
LOSS
Loss on investment
value (57,500) - (57,500) -
Total Other
Comprehensive Loss (57,500) - (57,500) -
COMPREHENSIVE
LOSS $(1,427,035) $ - $ (589,600) $ -
BASIC LOSS PER
SHARE OF
COMMON STOCK $ (0.12) $ (0.00) $ (0.05) $ (0.00)
FULLY DILUTED
LOSS PER SHARE $ (0.12) $ (0.00) $ (0.05) $ (0.00)
</TABLE>
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Operations
(Unaudited)
(Continued)
<TABLE>
<CAPTION>
From
Inception on
June 6,
1995 Through
September 30,
1999
<S> <C>
REVENUES $ 125,000
EXPENSES 1,508,722
NET LOSS (1,383,722)
OTHER COMPREHENSIVE LOSS
Loss on investment value (57,500)
Total Other Comprehensive Loss (57,500)
COMPREHENSIVE LOSS $(1,441,222)
</TABLE>
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
From Inception on June 6, 1995 through September 30, 1999
<TABLE>
<CAPTION>
Additional
Preferred Stock Common Stock Paid-In
Shares Amount Shares Amount Capital
<S> <C> <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 (3,500)
Net loss from inception on
June 6, 1995 through
December 31, 1995 - - - - -
Balance,
December 31, 1995 - - 6,000,000 6,000 (3,500)
Net loss for the year ended
December 31, 1996 - - - - -
Balance,
December 31, 1996 - - 6,000,000 6,000 (3,500)
Net loss for the year ended
December 31, 1997 - - - - -
Balance,
December 31, 1997 - $ - 6,000,000 $ 6,000 $(3,500)
</TABLE>
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
From Inception on June 6, 1995 through September 30, 1999
(Continued)
<TABLE>
<CAPTION>
Other
Subscriptions Comprehensive Accumulated
Receivable Loss Deficit
<S> <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 - - -
Net loss from inception on
June 6, 1995 through
December 31, 1995 - - (2,500)
Balance,
December 31, 1995 - - (2,500)
Net loss for the year ended
December 31, 1996 - - -
Balance,
December 31, 1996 - - (2,500)
Net loss for the year ended
December 31, 1997 - - -
Balance,
December 31, 1997 $ - $ - $ (2,500)
</TABLE>
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit) (Continued)
From Inception on June 6, 1995 through September 30, 1999
<TABLE>
<CAPTION>
Preferred Stock Common Stock Paid-In
Shares Amount Shares Amount Capital
<S> <C> <C> <C> <C> <C>
Balance,
December 31, 1997 - $ - 6,000,000 $ 6,000 $ (3,500)
Stock issued on
subscription for services
at $0.50 per share on
December 28, 1998 - - 100,000 100 49,900
Net loss for the year ended
December 31, 1998 - - - - -
Balance,
December 31, 1998 - - 6,100,000 6,100 46,400
Stock issued for technology,
recorded at predecessor
cost, January 6, 1999 - - 4,000,000 4,000 (4,000)
Stock issued for services
at $0.50 per share on
January 6, 1999 - - 100,000 100 49,900
Stock issued on
subscription at $1.00 per
share, January 8, 1999 - - 1,000,000 1,000 999,000
Balance Forward - $ - 11,200,000 $ 11,200 $1,091,300
</TABLE>
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
From Inception on June 6, 1995 through September 30, 1999
(Continued)
<TABLE>
<CAPTION>
Other
Subscriptions Comprehensive Accumulated
Receivable Loss Deficit
<S> <C> <C> <C>
Balance,
December 31, 1997 $ - $ - $ (2,500)
Stock issued on
subscription for services
at $0.50 per share on
December 28, 1998 (50,000) - -
Net loss for the year ended
December 31, 1998 - - (11,687)
Balance,
December 31, 1998 (50,000) - (14,187)
Stock issued for technology,
recorded at predecessor
cost, January 6, 1999 - - -
Stock issued for services
at $0.50 per share on
January 6, 1999 - - -
Stock issued on
subscription at $1.00 per
share, January 8, 1999 (1,000,000) - -
Balance Forward $(1,050,000) - $(14,187)
</TABLE>
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit) (Continued)
From Inception on June 6, 1995 through September 30, 1999
<TABLE>
<CAPTION>
Preferred Stock Common Stock Paid-In
Shares Amount Shares Amount Capital
<S> <C> <C> <C> <C> <C>
Balance Forward - $ - 11,200,000 $ 11,200 $1,091,300
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 at $4.00 per share
(unaudited) - - 4,250 4 16,996
Common stock issued for cash
at $2.00 per share
(unaudited) - - 450,000 450 899,550
Loss on investment
(unaudited) - - - - -
Net loss for the nine months
ended September 30, 1999
(unaudited) - - - - -
Balance,
September 30, 1999
(unaudited) 2,000,000 $ 2,000 11,604,250 $ 11,654 2,007,846
</TABLE>
<PAGE>
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
From Inception on June 6, 1995 through September 30, 1999
(Continued)
<TABLE>
<CAPTION>
Other
Subscriptions Comprehensive Accumulated
Receivable Loss Deficit
<S> <C> <C> <C>
Balance Forward $ (1,050,000) $ - $ (14,187)
Stock issued to founders
recorded at $0.001 which
approximates predecessor
cost, January 8, 1999 - - -
Receipt of stock
subscription (unaudited) 1,050,000 - -
Common stock issued for
cash at $4.00 per share
(unaudited) (17,000) - -
Common stock issued for cash
at $2.00 per share
(unaudited) (391,070) - -
Loss on investment
(unaudited) - (57,500) -
Net loss for the nine months
ended September 30, 1999
(unaudited) - - (1,369,535)
Balance,
September 30, 1999
(unaudited) $ (408,071) $ (57,500) $(1,383,722)
</TABLE>
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
For the For the
Nine Months Ended Three Months Ended
September 30, September 30,
1999 1998 1999 1998
<S> <C> <C> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES
Net loss $ (1,369,535) $ - $ (532,100) $ -
Adjustments to reconcile
net loss to net cash
provided (used) by
operating activities:
Common stock issued
for services 100,000 - 50,000 -
Preferred stock issued
for services 2,000 - - -
Depreciation expense 12,327 - 6,117 -
Investments received
for services (125,000) - (125,000) -
Changes in operating
assets and liabilities:
(Increase) decrease in
prepaid expenses (28,596) - (21,841) -
Increase (decrease) in
accounts payable 40,951 - (22,502) -
Increase (decrease) in
accounts payable
- related parties 38,962 - (20,303) -
Net Cash Used by
Operating Activities (1,328,891) - (665,629) -
CASH FLOWS FROM INVESTING
ACTIVITIES
Purchase of fixed assets (122,351) - (39,691) -
Net Cash Used by
Investing Activities (122,351) - (39,691) -
CASH FLOWS FROM FINANCING
ACTIVITIES
Common stock issued
for cash 1,508,929 - 744,500 -
Net Cash Provided by
Financing Activities 1,508,929 - 744,500 -
NET CHANGE IN CASH 57,687 - 39,180 -
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD - - 18,507 -
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 57,687 $ - $ 57,687 $ -
</TABLE>
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
(Continued)
<TABLE>
<CAPTION>
From
Inception on
June 6,
1995 Through
September 30,
1999
<S> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES
Net loss $ (1,383,722)
Adjustments to reconcile net loss to
net cash provided (used) by
operating activities:
Common stock issued
for services 100,000
Preferred stock issued
for services 2,000
Depreciation expense 12,327
Investments received
for services (125,000)
Changes in operating
assets and liabilities:
(Increase) decrease in prepaid expenses (28,596)
Increase (decrease) in accounts payable 52,638
Increase (decrease) in accounts payable
- related parties 38,962
Net Cash Used by Operating Activities (1,331,391)
CASH FLOWS FROM INVESTING
ACTIVITIES
Purchase of fixed assets (122,351)
Net Cash Used by Investing Activities (122,351)
CASH FLOWS FROM FINANCING
ACTIVITIES
Common stock issued for cash 1,511,429
Net Cash Provided by Financing Activities 1,511,429
NET CHANGE IN CASH 57,687
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD -
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 57,687
</TABLE>
<PAGE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Cash Flows (Continued)
(Unaudited)
<TABLE>
<CAPTION>
For the For the
Nine Months Ended Three Months Ended
September 30, September 30,
1999 1998 1999 1998
<S> <C> <C> <C> <C>
SUPPLEMENTAL DISCLOSURE
OF CASH FLOW INFORMATION
Interest paid $ - $ - $ - $ -
Income taxes paid $ - $ - $ - $ -
SCHEDULE OF NON-CASH
FINANCING ACTIVITIES:
Common stock issued
for services $ 100,000 $ - $ 50,000 $ -
Preferred stock issued
for services $ 2,000 $ - $ - $ -
</TABLE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
(Continued)
<TABLE>
<CAPTION>
From
Inception on
June 6,
1995 Through
September 30,
1999
<S> <C>
SUPPLEMENTAL DISCLOSURE
OF CASH FLOW INFORMATION
Interest paid $ -
Income taxes paid $ -
SCHEDULE OF NON-CASH
FINANCING ACTIVITIES:
Common stock issued for services $ 100,000
Preferred stock issued for services $ 2,000
</TABLE>
ALPHATRADE.COM
(Formerly Honor One Corporation)
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1999 and December 31, 1998
NOTE 1 - CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The accompanying consolidated financial statements have been prepared
by the Company without audit. In the opinion of management, all adjustments
(which include only normal recurring adjustments) necessary to present fairly
the financial position, results of operations and cash flows at September 30,
1999 and for all periods presented have been made.
Certain information and footnote disclosures normally included in
consolidated financial statements prepared in accordance with general accepted
accounting principles have been condensed or omitted. It is suggested that
these condensed consolidated financial statements be read in conjunction with
the financial statements and notes thereto included in the Company's December
31, 1998 audited consolidated financial statements. The results of operations
for the periods ended September 30, 1999 and 1998 are not necessarily
indicative of the operating results for the full year.
Item 2. Management's Discussion and Analysis or Plan of Operation.
Plan of Operation.
- ------------------
The Company continued to develop its browser-based technology during
the quarter ended September 30, 1999. During the month of September the
company released its beta version for testing. At the end of October, which
was subsequent to the period covered by this Report, the beta test was
complete and the company released the commercial version of the E-Gate
financial tools. At present, the company plans to begin marketing the E-Gate
tools to the brokerage community and to investors. The marketing approach is
target brokerage firms that want to enhance their online presence and those
wanting to add special services for their clients. Presently there is no
competition for the E-Gate tools since they use the latest thin client
technology and the pricing is so competitive. The Company does not foresee an
immediate need to raise additional capital since subscription revenues begin
November 1, 1999. The first sale was made to Providential Securities for
5,000 delayed subscriptions and the company is anticipating an accelerated
demand for their product over the next 60 day period and into the new year.
Before the end of 1999, the company plans to augment the current available
tools from the quote grid, the portfolio tracker, the indices, and the snap
quote to include a charting applet, a highly functional news applet,
Level II and many alert functions. Although the Internet financial portal
industry is fiercely competitive, AlphaTrade has differentiated itself by
using a unique business model that is based on subscription revenues.
Results of Operation.
- ---------------------
As at September 30, 1999 the Company had $57,687 in cash, $263,807 in
assets and $91,600 in liabilities. The Company had no revenues for the
quarter ending September 30, 1999 and incurred net losses of $532,100 with
total net comprehensive losses to date of $1,427,035. The company received
$400,000 in funds subsequent to the end of the quarter from a director of the
company. These funds are for general working capital.
Revenues begin in the fourth quarter as on November 1, 1999, the Company
began accepting paid subscriptions. Subscribers are offered streaming
financial information using state-of-the-art technologies and will have the
ability to save their quotation and portfolio preferences as well as any
customizations they have done. Initial subscriptions and charter memberships
are offered at the introductory rate of $19.99 per month for real time
information and $19.99 per year for delayed financial information.
Also subsequent to the quarter Gordon Muir was appointed as the Chairman
of the Board and a Director of the Company and Penny Perfect was appointed as
the President/CEO and a Director of the Company.
Liquidity
- ---------
At September 30, 1999, the Company had cash on hand of $57,687, with
accounts payable totaling $91,600.
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.
In August, 1999, the Plaintiffs filed a Motion for a preliminary
injunction against the Company. Prior to the hearing before the Courts for
the preliminary injunction in October, 1999, Plaintiff's lawyers notified the
Company's lawyers that they did not wish to proceed with the injunction and it
was removed from the court calendar.
Item 2. Changes in Securities.
On July 6, 1999, the Company conducted a private placement of
400,000 "unregistered" and "restricted" shares of the Company's common stock
at a price of $2.00 per share.
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.
None.
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: 11/11/99 By /s/ Penny Perfect
President/CEO 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: 11/11/99 By /s/ Penny Perfect
President/CEO and Director
Date: 11/9/99 By /s/ J. Michael Pinkney
Secretary/Treasurer and Director
Date: 11/11/99 By /s/ Gordon Muir
Director
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> SEP-30-1999
<CASH> 57687
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 86283
<PP&E> 122351
<DEPRECIATION> 12327
<TOTAL-ASSETS> 263807
<CURRENT-LIABILITIES> 91600
<BONDS> 0
0
2000
<COMMON> 11654
<OTHER-SE> 158553
<TOTAL-LIABILITY-AND-EQUITY> 263807
<SALES> 0
<TOTAL-REVENUES> 125000
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1494535
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (1427035)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1427035)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1427035)
<EPS-BASIC> (0.12)
<EPS-DILUTED> (0.12)
</TABLE>
