SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter ended September 30, 2001
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________________ to ________________
Commission File No 0-32307
ALPHA HOLDING, INC.
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(Exact name of registrant as specified in its charter)
Delaware 59-3518707
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(State or other jurisdiction (IRS Employer
of incorporation or organization) ID Number)
c/o Steven L. Siskind; 645 Fifth Avenue, Suite 403, New York, NY 10022
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(Address of principal executive offices)
(212) 750-2002
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(Issuer's Telephone Number)
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(Former name, former address and former fiscal year,
if changed since last report)
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
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As of September 30, 2001, the Issuer had 3,460,490 shares of Common Stock, par
value $.001 per share, issued and outstanding.
PART I
Item 1. Financial Statements and Exhibits
(a) The unaudited financial statements of Registrant for the three
months ended September 30, 2001, follow. The financial statements
reflect all adjustments which are, in the opinion of management,
necessary to a fair statement of the results for the interim
period presented.
1
ALPHA HOLDING, INC.
(A DEVELOPMENT STAGE COMPANY)
SEPTEMBER 30, 2001
I N D E X
Page No.
--------
BALANCE SHEETS
September 30, 2001 and December 31, 2000 F-2
STATEMENTS OF OPERATIONS
For the three and the nine months ended
September 30, 2001 and 2000 and
cumulative amounts since inception
August 19, 1997 to September 30, 2001 F-3
STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIENCY
Inception August 19, 1997 to September 30, 2001 F-4
STATEMENTS OF CASH FLOWS
For the three and the nine months ended
September 30, 2001 and 2000 and
cumulative amounts since inception
August 19, 1997 to September 30, 2001 F-5
NOTES TO FINANCIAL STATEMENTS F-6
ALPHA HOLDING, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
(Unaudited)
SEPTEMBER 30, DECEMBER 31,
2 0 0 1 2 0 0 0
------- -------
ASSETS
------
CURRENT ASSETS
Cash $ -- $ 36
Loans receivable - related party 430 430
-------- --------
TOTAL ASSETS $ 430 $ 466
======== ========
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
----------------------------------------
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 3,241 $ 188
-------- --------
TOTAL LIABILITIES 3,241 188
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STOCKHOLDERS' DEFICIENCY
Common stock - $0.001 par value,
10,000,000 shares authorized,
3,460,490 shares issued and outstanding 3,461 3,461
Paid-in capital 5,160 5,160
Deficit accumulated during the development stage (11,432) (8,343)
-------- --------
TOTAL STOCKHOLDERS' DEFICIENCY (2,811) 278
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS'
DEFICIENCY $ 430 $ 466
======== ========
The accompanying notes are an integral part of the financial statements.
F-2
ALPHA HOLDING, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
(Unaudited)
CUMULATIVE
AMOUNTS SINCE
INCEPTION AUGUST
THREE THREE NINE NINE 19, 1997 TO
MONTHS MONTHS MONTHS MONTHS SEPTEMBER 30,
ENDED ENDED ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
2 0 0 1 2 0 0 0 2 0 0 1 2 0 0 0 2 0 0 1
------- ------- ------- ------- -------
INCOME $ -- $ -- $ -- $ -- $ --
COST AND EXPENSES
Selling and administrative
expenses 3,032 3,293 3,089 5,050 (11,244)
----------- ----------- ----------- ----------- -----------
OPERATING LOSS (3,032) (3,293) (3,089) (5,050) (11,244)
----------- ----------- ----------- ----------- -----------
PROVISION FOR INCOME TAXES -- -- -- -- 188
----------- ----------- ----------- ----------- -----------
NET LOSS $ (3,032) $ (3,293) $ (3,089) $ (5,050) $ (11,432)
=========== =========== =========== =========== ===========
Net loss per share of common
stock $ (0.00) $ (0.00) $ (0.00) $ (0.00) $ (0.01)
=========== =========== =========== =========== ===========
Weighted average number of
common shares 3,460,490 2,816,557 3,460,490 2,816,557 1,944,536
=========== =========== =========== =========== ===========
The accompanying notes are an integral part of the financial statements.
F-3
ALPHA HOLDING, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS' DEFICIENCY
INCEPTION AUGUST 19, 1997 T0 SEPTEMBER 30, 2001
(Unaudited)
DEFICIT
COMMON STOCK ACCUMULATED
$.001 PAR VALUE ADDITIONAL DURING THE
-------------------- PAID-IN DEVELOPMENT
SHARES AMOUNT CAPITAL STAGE TOTAL
------ ------ ------- ----- -----
Common stock Issued for cash -
for the year ended August 1997 670,610 $ 671 $ -- $ -- $ 671
Net loss for the period -
August 19, 1997 through
December 31, 1997 -- -- -- (554) (554)
--------- --------- --------- --------- ---------
BALANCE - DECEMBER 31, 1997 670,610 671 -- (554) 117
Net loss for the year ended December
31, 1998 -- -- -- (105) (105)
--------- --------- --------- --------- ---------
BALANCE - DECEMBER 31, 1998 670,610 671 -- (659) 12
Common stock issued for cash the
year ended December 31, 1999 1,823,980 1,824 1,633 -- 3,457
Net loss for the year ended December
31, 1999 -- -- -- (498) (498)
--------- --------- --------- --------- ---------
BALANCE - DECEMBER 31, 1999 2,494,590 2,495 1,633 (1,157) 2,971
Common stock issued for cash -
for the ended December 31, 2000 965,900 966 3,527 -- 4,493
Net loss for the year ended -
December 31, 2000 -- -- -- (7,186) (7,186)
--------- --------- --------- --------- ---------
BALANCE - DECEMBER 31, 2000 3,460,490 3,461 5,160 (8,343) 278
Net loss for the nine months ended -
September 30, 2000 -- -- -- (3,089) (3,089)
--------- --------- --------- --------- ---------
BALANCE - SEPTEMBER 30, 2001 3,460,490 $ 3,461 $ 5,160 $ (11,432) $ (2,811)
========= ========= ========= ========= =========
The accompanying notes are an integral part of the financial statements.
F-4
ALPHA HOLDING, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
(Unaudited)
CUMULATIVE
AMOUNTS SINCE
THREE THREE NINE NINE INCEPTION
MONTHS MONTHS MONTHS MONTHS AUGUST 19,
ENDED ENDED ENDED ENDED 1997 TO
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
2 0 0 1 2 0 0 0 2 0 0 1 2 0 0 0 2 0 0 1
------- ------- ------- ------- -------
CASH FLOWS FROM OPERATING
ACTIVITIES
Net loss (3,032) (3,293) (3,089) $ (5,050) (11,432)
Changes in assets and liabilities:
Loans receivable - related party -- -- -- 1,650 (430)
Accounts payable and accrued
expenses 3,032 (1,616) 3,053 (1,434) 3,241
-------- -------- -------- -------- --------
CASH USED BY OPERATION
ACTIVITIES -- (4,909) (36) (4,834) (8,621)
-------- -------- -------- -------- --------
CASH FLOWS FROM FINANCING
ACTIVITIES
Issuance of common stock -- 23 -- 48 3,461
Additional paid-in capital -- 1,127 -- 3,527 5,160
-------- -------- -------- -------- --------
CASH PROVIDED BY
FINANCING ACTIVITIES -- 1,150 -- 3,575 8,621
-------- -------- -------- -------- --------
NET INCREASE (DECREASE) IN CASH -- (3,759) (36) (1,259) --
CASH - Beginning of period -- 3,759 36 1,259 --
-------- -------- -------- -------- --------
CASH - End of period $ -- $ -- $ -- $ -- $ --
======== ======== ======== ======== ========
The accompanying notes are an integral part of the financial statements.
F-5
ALPHA HOLDING, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q. Accordingly,
they do not include all of the information and footnotes required by
generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the three and nine months ended September
30, 2001 are not necessarily indicative of the results that may be expected
for the year ending December 31, 2001. For further information, refer to
the financial statements and footnotes thereto included in the Company's
Annual Report on Form 10-KSB for the year ended December 31, 2000.
1. BUSINESS DESCRIPTION - ORGANIZATION
On August 19, 1997, Alpha Holding, Inc. (the "Company") was incorporated
under the laws of the State of Delaware. The Company may engage in any
business that is permitted by the General Corporation Law of Delaware.
The Company can be defined as a "shell" corporation whose principal
business is to locate and consummate a merger or acquisition with an
ongoing business.
RESULTS OF OPERATIONS
During the three and nine months ended September 30, 2001, the Company has
engaged in no significant operations other than the acquisition of
capital for general and administrative expenses and registration of its
securities under the Securities Exchange Act of 1934. During this
period, the Company received no operating revenues. General and
administrative expenses consist primarily of professional fees.
The Company's existing capital will not be sufficient to meet the Company's
cash needs, including complying with its continuing reporting
obligation under the Securities Exchange Act of 1934. Accordingly,
additional capital will be required.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
STATEMENT OF CASH FLOWS
The Company considers all liquid debt instruments purchased with a maturity
of three months or less to be cash equivalents. No cash was paid for
interest and taxes for the periods ended September 30, 2001 and August
19, 1997 (date of inception) through September 30, 2001.
START-UP COSTS
The Company adopted the provisions of the American Institute of Certified
Public Accountants' Statement of Position 98-5, "Reporting on the Costs
of Start-Up Activities". SOP provides guidance on the financial
reporting of start-up and organization costs and requires such costs to
be expensed as incurred.
The start-up costs consist principally of professional and consulting fees.
F-6
ALPHA HOLDING, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
NET LOSS PER COMMON SHARE
The net loss per common share is computed by dividing the net loss for the
period by the weighted average number of shares outstanding for the
three months and nine months ended September 30, 2001 and 2000 and from
August 19, 1997 (date of inception) through September 30, 2001.
USE OF ESTIMATES
The preparation of the accompanying 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 expenses during the reporting periods. Actual results could
differ from those estimates.
INCOME TAXES
The Company is currently in a development stage and has not yet commenced
an active trade or business, therefore, the Company did not provide any
current or deferred federal or state income tax provision or benefit
for any of the periods presented because to date, as it has experienced
operating losses. The Company has a federal net operating loss
carryforward of approximately $11,432 expiring in the year 2017. The
tax benefit of this net operating loss, based on an effective tax rate
of 40%, is approximately $4,600 and has been offset by a full valuation
allowance.
SAFS No. 109 requires a valuation allowance to be recorded when it is more
likely than not that some or all of the deferred tax assets will not be
realized. At September 30, 2001, a valuation allowance for the full
amount of the net deferred tax asset was recorded because of continuing
losses and uncertainties regarding the amount of taxable income that
would be generated in future years. For the period ended September 30,
2001, based on an effective tax rate of 40%, the valuation allowance
increased by $1,200. The use of these carryforwards is subject to
limitations imposed by the Internal Revenue Service in the event of a
change in control.
3. COMMON STOCK
The Company is authorized to issue 10,000,000 shares of par value $.001
common stock.
During 2000 and 1999, the Company issued 965,900 and 1,823,980 shares,
respectively, of common stock that was valued at various prices with
the calculated average prices per share being $0.0047 and $0.0019 for
2000 and 1999, respectively. These values were based upon management's
estimate of the current market prices at the time the shares were
issued.
F-7
Item 2. Management's Discussion and Analysis or Plan of Operation
The Company is considered a development stage company with limited assets
or capital, and with limited operations or income since inception in August 19,
1997. The costs and expenses associated with the preparation and filing of this
registration statement and other operations of the company have been paid for by
the controlling shareholders of the Company who are also its officers and
directors. It is anticipated that the Company will require only nominal capital
to maintain the corporate viability of the Company and any additional needed
funds will most likely be provided by the Company's existing shareholders or its
officers and directors in the immediate future. Current shareholders have not
agreed upon the terms and conditions of future financing and such undertaking
will be subject to future negotiations, except for the express commitment of the
officers and directors to fund required filings pursuant to the Securities
Exchange Act of 1934 (the " '34Act"). Repayment of any such funding will also be
subject to such negotiations. However, unless the Company is able to facilitate
an acquisition of or merger with an operating business or is able to obtain
significant outside financing, there is substantial doubt about its ability to
continue as a going concern.
In the opinion of management, inflation has not and will not have a
material effect on the operations of the Company until such time as the Company
successfully completes an acquisition or merger. At that time, management will
evaluate the possible effects of inflation on the Company as it relates to its
business and operations following a successful acquisition or merger.
Management plans may but do not currently provide for experts to secure a
successful acquisition or merger partner so that it will be able to continue as
a going concern. In the event such efforts are unsuccessful, contingent plans
have been arranged to provide that the current Director of the Company is to
fund required future filings under the 34 Act, and existing shareholders have
expressed an interest in additional funding if necessary to continue the Company
as a going concern.
Plan of Operation
The Company has entered into negotiations to acquire a privately held
company in exchange for issuance of a controlling interest in the Company's
common stock. In the event that negotiations are not concluded successfully,
then during the next twelve months, the Company will continue to actively seek
out and investigate possible business opportunities with the intent to acquire
or merge with one or more business ventures. In its search for business
opportunities, management will follow the procedures outlined in Item 1, above.
Because the Company has limited funds, it may be necessary for the officers and
directors to either advance funds to the Company or to accrue expenses until
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such time as a successful business consolidation can be made. The Company will
not make it a condition that the target company must repay funds advanced by its
officers and directors. Management intends to hold expenses to a minimum and to
obtain services on a contingency basis when possible. Further, the Company's
directors will defer any compensation until such time as an acquisition or
merger can be accomplished. However, if the Company engages outside advisors or
consultants in its search for business opportunities, it may be necessary for
the Company to attempt to raise additional funds. As of the date hereof, the
Company has not made any arrangements or definitive agreements to use outside
advisors or consultants or to raise any capital. In the event the Company does
need to raise capital, most likely the only method available to the Company
would be to private sale of its securities. Because of the nature of the Company
as a development stage company, it is unlikely that it could make a public sale
of securities or be able to borrow any significant sum from either a commercial
or private lender. There can be no assurance that the Company will be able to
obtain additional funding when and if needed, or that such funding, if
available, can be obtained on terms acceptable to the Company.
The Company does not intend to use any employees, with the possible
exception of part-time clerical assistance on an as-needed basis. Outside
advisors or consultants will be used only if they can be obtained for minimal
cost or on a deferred payment basis. Management is convinced that it will be
able to operate in this manner and to continue its search for business
opportunities during the next twelve months.
Year 2000 Compliance
The Year 2000 Issue is the result of potential problems with computer
systems or any equipment with computer chips that use dates where the date has
been stored as just two digits (e.g. 98 for 1998). On January 1, 2000, any clock
or date recording mechanism including date sensitive software which uses only
two digits to represent the year, may have recognized the date using 00 as the
year 1900 rather than the year 2000. This may have resulted in a system failure
or miscalculations causing disruption of operations, including among other
things, a temporary inability to process transactions, send invoices, or engage
in similar activities.
The Company has confirmed that its systems are year 2000 Compliant. It has
experience no Y2K problems to date.
The Company believes that it has disclose all required information relative
to Year 2000 issues relating to its business and operations. However, there can
be no assurance that the systems of other companies on which the Company's
systems rely also will be timely converted or that any such failure to convert
by another company would not have an adverse affect on the Company's systems.
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Forward-Looking Statements
This Form 10-QSB includes "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements, other than
statements of historical facts, included or incorporated by reference in this
Form 10-QSB which address activities, events or developments which the Company
expects or anticipates, will or may occur in the future, including such things
as future capital expenditures (including the amount and nature thereof),
finding suitable merger or acquisition candidates, expansion and growth of the
Company's business and operations, and other such matters are forward-looking
statements. These statements are based on certain assumptions and analysis made
by the Company in light of its experience and its perception of historical
trends, current conditions and expected future developments as well as other
factors it believes are appropriate in the circumstances. However, whether
actual results or developments will conform with the Company's expectations and
predictions is subject to a number of risks and uncertainties, general economic
market and business conditions; the business opportunities (or lack thereof)
that may be presented to and pursued by the Company; changes in laws or
regulation; and other factors, most of which are beyond the control of the
Company. Consequently, all of the forward-looking statements made in this Form
10-QSB are qualified by these cautionary statements, and there can be no
assurance that the actual results or developments anticipated by the Company
will be realized or, even if substantially realized, that they will have the
expected consequence to or effects on the Company or its business or operations.
The Company assumes no obligations to update any such forward-looking
statements.
PART II
Item 6. Exhibits and reports on Form 8-K
(a) The exhibits required to be filed herewith by Item 601 of
regulation S-B, as described in the following index of exhibits,
are incorporated herein by reference, as follows:
Exhibit No. Description
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3.1 Articles of Incorporation of Alpha Holding, Inc. (1)
3.2 By-Laws of Alpha Holding, Inc. (1)
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(1) Incorporated by referenced from the Form 10-SB filed by the Company on
February 7, 2001 (b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter ended September 30,
2000.
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SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant has
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Dated: November 8, 2001 ALPHA HOLDING, INC.
/S/ Dominick Pope
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Dominick Pope, President
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