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 June 30, 2002
[ ] 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 of (IRS Employer ID Number)
incorporation or organization)
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 June 30, 2002, the Issuer had 3,800,000 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 June 30, 2002, 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.
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ALPHA HOLDING, INC.
JUNE 30, 2002
I N D E X
Page No.
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CONDENSED BALANCE SHEETS F-2
CONDENSED STATEMENTS OF OPERATIONS F-3
CONDENSED STATEMENTS OF CASH FLOWS F-4
NOTES TO CONDENSED FINANCIAL STATEMENTS F-5
F-1
ALPHA HOLDING, INC.
CONDENSED BALANCE SHEETS
(Unaudited)
June 30, December 31,
2 0 0 2 2 0 0 1
-------- --------
Assets
------
Current Assets
Loans receivable - related party $ 430 $ 430
-------- --------
Total Assets $ 430 $ 430
======== ========
Liabilities and Stockholders' Deficiency
----------------------------------------
Current Liabilities
Accounts payable and accrued expenses $ 8,156 $ 6,211
Due to related party 4,430 --
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Total Liabilities 12,586 6,211
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Stockholders' Deficiency
Common stock - $.001 par value,
authorized 10,000,000 shares,
issued 3,800,000 shares 3,800 3,800
Paid-in capital 5,160 5,160
Deficit (21,116) (14,741)
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Total Stockholders' Deficiency (12,156) (5,781)
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Total Liabilities and Stockholders' Deficiency $ 430 $ 430
======== ========
The accompanying notes are an integral part of the condensed
financial statements.
F-2
ALPHA HOLDING, INC.
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended Six Months Ended
June 30, June 30
---------------------- ------------------------
2 0 0 2 2 0 0 1 2 0 0 2 2 0 0 1
------- ------- ------- -------
Cost and Expenses
Selling and administrative expenses $ 967 $ -- $ 6,375 $ --
----------- ----------- ----------- -----------
Operating Loss (967) -- (6,375) --
Provision For Income Taxes -- -- -- --
----------- ----------- ----------- -----------
Net Loss $ (967) $ -- $ (6,375) $ --
=========== =========== =========== ===========
Net loss per share of common stock $ (.00) $ (.00) $ (.00) $ (.00)
=========== =========== =========== ===========
Weighted average number of common shares
outstanding 3,800,000 3,460,490 3,800,000 3,460,490
=========== =========== =========== ===========
The accompanying notes are an integral part of the condensed
financial statements.
F-3
ALPHA HOLDING, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Six Months Ended
----------------
June 30,
--------
2 0 0 2 2 0 0 1
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Cash Flows From Operating Activities
Net loss $(6,375) $ --
Adjustments to reconcile net loss to net cash used in
operating activities:
Accounts payable and accrued expenses 1,945 --
------- -------
Cash Used In Operating Activities (4,430) --
------- -------
Cash Flows From Financing Activities
Due to related party 4,430 --
------- -------
Cash Provided By Financing Activities 4,430 --
------- -------
Net Change In Cash -- --
Cash - Beginning of period -- --
------- -------
Cash - End of period $ -- $ 36
======= =======
The accompanying notes are an integral part of the condensed
financial statements.
F-4
ALPHA HOLDING, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
The accompanying unaudited condensed financial statements have been
prepared in accordance with accounting principles generally accepted in the
United States of America for interim financial information and with the
instructions to Form 10-QSB and Item 310 of Regulation S-B. Accordingly,
they do not include all of the information and footnotes required by
accounting principles generally accepted in the United States of American
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 six
months ended June 30, 2002 are not necessarily indicative of the results
that may be expected for the year ending December 31, 2002. For further
information, refer to the financial statements and footnotes thereto
included in the Form 10-KSB for the year ended December 31, 2001.
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 is a "blank check" company. A "blank check" company is a company
that has no specific business plan or purpose or has indicated that its
business plan is to engage in a merger or acquisition with an unidentified
company or companies. The Company has been exploring sources to obtain
additional equity or debt financing. The Company has also indicated its
intention to participate in one or more as yet unidentified business
ventures, which management will select after reviewing the business
opportunities for their profit or growth potential.
Due to the Company having no specific business plan or operations, the
Company is not a "Development Stage Company" as defined by Generally
Accepted Accounting Principles (GAAP), as was reported in the Company's
prior financial statements. Therefore, cumulative amounts are not reported
on the statements of operations and cash flows.
On January 11, 2002, the Company signed an agreement to merge with TODTRI
Productions, Ltd. (a New York State Corporation). The closing date for this
merger has not yet been finalized.
LIQUIDITY AND CAPITAL RESOURCES
The accompanying condensed financial statements have been prepared assuming
that the Company will continue as a going concern. The Company has suffered
recurring losses from operations and has a net capital deficiency that
raises substantial doubt about its ability to continue as a going concern.
The Company is a "blank check" Company and has experienced no significant
change in liquidity, capital resources of stockholders' equity other than
the receipt of proceeds for its operating expenses. Substantially all of
such funds have been used to pay expenses incurred by the Company.
F-5
ALPHA HOLDING, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
1. BUSINESS DESCRIPTION - ORGANIZATION (Continued)
RESULTS OF OPERATIONS
For the six months and three months ended June 30, 2002, the Company had
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 is seeking to carry out its plan of business to complete a
merger or business acquisition transaction. 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 highly liquid debt instruments purchased with a
maturity of three months or less to be cash equivalents. No cash was paid
for interest and income taxes for the periods ended June 30, 2002 and 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.
LOSS PER COMMON SHARE
Loss per common share is computed by dividing the net loss for the year by
the weighted average number of shares outstanding for the periods ended
June 30, 2002 and 2001.
USE OF ESTIMATES
The preparation of the accompanying condensed 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.
F-6
ALPHA HOLDING, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
SIGNIFICANT ESTIMATES
Several areas require significant management estimates relating to
uncertainties for which it is reasonably possible that there will be a
material change in the near term. The significant area requiring the use of
management estimates related to accrued expenses.
INCOME TAXES
Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective
tax basis. Deferred tax assets and liabilities are measured using enacted
tax rates expected to apply to taxable income in the years in which those
temporary differences are expected to reverse. The effect on deferred tax
assets and liabilities from a change in tax rates is recognized in the
statement of operations in the period that includes the enactment date.
The Company 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,
it has experienced operating losses. The Company has a federal net
operating loss carryforward of approximately $21,000 expiring in the years
2017 through 2022. The tax benefit of this net operating loss, based on an
effective tax rate of 40%, is approximately $8,400 and has been offset by a
full valuation allowance. For the three and six months ended June 30, 2002,
based on an effective tax rate of 40%, the valuation allowance increased by
$2,550 and $387, respectively.
The use of net operating loss carryforward is subject to limitations
imposed by the Internal Revenue Service in the event of the change in
control.
3. COMMON STOCK
The Company is authorized to issue 10,000,000 shares of par value $.001
common stock.
From August 19, 1997 inception through June 30, 2002, the Company issued
3,800,000 shares of common stock that has been valued at prices ranging
from $.001 to $.10. These values were based upon management's estimate of
the current market prices at the time the shares were issued.
4. COMMON STOCK TRANSACTIONS - RELATED PARTIES
Pursuant to a resolution adopted by the Board of Directors on August 9,
2001 for related party services performed in 2001, the Company issued
339,510 shares of restricted common stock to certain shareholders at a
price of $.001 per share, for an aggregate consideration of $339, which
includes $324 of consulting fees and $15 of director's fees.
F-7
ALPHA HOLDING, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
5. RELATED PARTY TRANSACTIONS
The caption "Due to related Company" are loans that are unsecured,
non-interest bearing and have no fixed terms of repayment, therefore,
deemed payable on demand. The Company's operating expenses in 2002 were
paid by the related company.
The balance due to the related company, at June 30, 2002 and December 31,
2001 was $4,430 and $-0-, respectively.
F-8
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,
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 " '34 Act"). 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
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.
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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.
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
- ----------- -------------------------------------------------------
3.1 Articles of Incorporation of Alpha Holding, Inc. (1)
3.2 By-Laws of Alpha Holding, Inc. (1)
99.1 Certificate*
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* Filed herewith
(1) Incorporated by referenced from the Form 10-SB filed by the Company on
February 7, 2001
(b) No reports on Form 8-K were filed during the quarter ended June 30,
2002.
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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 August 14, 2002 ALPHA HOLDING, INC.
/s/ Steven L. Siskind
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Steven L. Siskind, President
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