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, 2004
[_] 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
SEA SUN CAPITAL CORPORATION
---------------------------
(Exact name of registrant as specified in its charter)
Delaware 59-3518707
-------- ----------
(State or other jurisdiction (IRS Employer ID Number)
of incorporation or organization)
424 Brookmill Rd., Oakville, Ontario L6J 5K5 Canada
---------------------------------------------------
(Address of principal executive offices)
(905) 844-3680
---------------------------
(Issuer's Telephone Number)
ALPHA HOLDING, INC.
Suite 205, 9977 - 178 St. Bldg. #14, Edmonton, Alberta T5T 6J6 Canada
---------------------------------------------------------------------
(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
------ ------
As of November 15, 2004, the issuer had 8,330,000 shares of Common Stock, par
value $.001 per share, issued and outstanding.
Item 1. Financial Statements and Exhibits
- ------------------------------------------
(a) The unaudited financial statements of Registrant for the nine months ended
September 30, 2004, 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.
SEA SUN CAPITAL CORPORATION
---------------------------
SEPTEMBER 30, 2004
(unaudited)
I N D E X
---------
Page No.
--------
CONDENSED BALANCE SHEET F-2
CONDENSED STATEMENTS OF OPERATIONS F-3
CONDENSED STATEMENTS OF CASH FLOWS F-4
NOTES TO CONDENSED FINANCIAL STATEMENTS F-5 - F-8
F-1
SEA SUN CAPITAL CORPORATION
CONDENSED BALANCE SHEET
(unaudited) AS OF
SEPTEMBER 30, 2004
Assets
------
Current assets
Loans receivable - related party $ 430
Inventory 4,530
----------------
Total assets $ 4,960
================
Liabilities and Stockholders' Deficiency
----------------------------------------
Current liabilities
Accounts payable/Accrued expenses $ 9,842
Due to related party 33,077
----------------
Total Liabilities $ 42,919
----------------
Stockholders' deficiency
Preferred stock - $. 001 par value,
authorized 50,000,000 shares,
issued 0 shares 0
Common stock - $.001 par value,
authorized 100,000,000 shares,
issued 8,330,000 shares 8,330
Additional paid-in capital 5,160
Deficit (51,449)
----------------
Total stockholders' deficiency (37,959)
----------------
Total liabilities and stockholders' deficiency $ 4,960
================
The accompanying notes are an integral part of the condensed
financial statements.
F-2
SEA SUN CAPITAL CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
2 0 0 4 2 0 0 3 2 0 0 4 2 0 0 3
-------------- -------------- -------------- --------------
Cost and expenses
Selling and administrative expenses $ 12,102 $ 1,731 $ 19,559 $ 5,826
-------------- -------------- -------------- --------------
Operating loss (12,102) (1,731) (19,559) (5,826)
Net loss $ (12,102) $ (1,731) $ (19,559) $ (5,826)
============== ============== ============== ==============
Loss per common share $ (.00) $ (.00) $ (.00) $ (.00)
============== ============== ============== ==============
Weighted average common
shares outstanding 8,300,000 3,800,000 8,300,000 3,800,000
============== ============== ============== ==============
The accompanying notes are an integral part of the condensed
financial statements.
F-3
SEA SUN CAPITAL CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
(unaudited)
Nine Months Ended September 30
2 0 0 4 2 0 0 3
-------------- --------------
Cash flows from operating activities
Net loss $ (19,559) $ (5,826)
Adjustments to reconcile net loss
to net cash used in operating activities:
Changes in operating assets and liabilities-
Accrued expenses 7,420 3,270
-------------- --------------
Cash used in operating activities (12,139) (2,556)
-------------- --------------
Cash flows from financing activities
Due to related party 12,139 2,556
-------------- --------------
Cash provided by financing activities 12,139 2,556
-------------- --------------
Net change in cash -- --
Cash - beginning of period -- --
-------------- --------------
Cash - end of period $ -- $ --
============== ==============
The accompanying notes are an integral part of the condensed
financial statements.
F-4
SEA SUN CAPITAL CORPORATION.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(unaudited)
1. BUSINESS DESCRIPTION - ORGANIZATION
-----------------------------------
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 America
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 nine
months ended September 30, 2004 are not necessarily indicative of the
results that may be expected for the year ending December 31, 2004. For
further information, refer to the financial statements and footnotes
thereto included in the Form 10-KSB for the year ended December 31, 2003.
On August 19, 1997, Alpha Holding, Inc. (the "Company") was incorporated
under the laws of the State of Delaware. A name change to Sea Sun Capital
Corporation was effected September 29, 2004. 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.
LIQUIDITY AND CAPITAL RESOURCES
-------------------------------
The accompanying 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
SEA SUN CAPITAL CORPORATION.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(unaudited)
1. BUSINESS DESCRIPTION - ORGANIZATION (CONT'D)
--------------------------------------------
RESULTS OF OPERATIONS
---------------------
For the nine months ended September 30, 2004 and 2003, 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 for the nine months ended September 30, 2004 and 2003. During
the nine months ended September 30, 2003 and 2002, the Company paid $0 in
income taxes.
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 98-5 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 period
by the weighted average number of shares outstanding for the nine months
ended September 30, 2004 and 2003.
F-6
SEA SUN CAPITAL CORPORATION.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(unaudited)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT'D)
---------------------------------------------------
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.
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 $32,000 expiring in the years
2017 through 2023. The tax benefit of this net operating loss, based on an
effective tax rate of 40%, is approximately $12,800and has been offset by a
full valuation allowance. .
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.
F-7
SEA SUN CAPITAL CORPORATION.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(unaudited)
3. COMMON STOCK
------------
The Company is authorized to issue 100,000,000 shares of par value $.001
common stock and 50,000,000 of preferred stock with a $ .001 par value.
The Company has issued and outstanding 8,330,000 shares of common stock
that have 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. No preferred stock has been issued.
4. 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 2004 and 2003
were paid by related companies. The balance due to the related company, at
September 30, 2004 was $33,077.
5. NAME CHANGE
-----------
On September 29, 2004 the name Alpha Holding, Inc. was changed to Sea Sun
Capital Corporation. At the same time the authorized common stock was
increased from 10,000,000 to 100,000,000 shares and a new class of
50,000,000 preferred shares was created. These changes became effective on
that date with the filing of the Certificate of Amendment of the
Certificates of Incorporation with the Delaware Secretary of State.
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
document 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
2
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 through a 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.
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.
Item 3. Controls and Procedures
- --------------------------------
In accordance with Exchange Act Rules 13a-15 and 15d-15, we carried out an
evaluation, under the supervision and with the participation of management,
including our Chief Executive Officer , of the effectiveness of our disclosure
controls and procedures as of the end of the period covered by this report.
Based on that evaluation, our Chief Executive Officer concluded that our
disclosure controls and procedures were effective as of September 30, 2004 to
provide reasonable assurance that information required to be disclosed in our
reports filed or submitted under the Exchange Act is recorded, processed,
summarized and reported within the time periods specified in the Securities and
Exchange Commission's rules and forms.
There has been no change in our internal controls over financial reporting
that occurred during the quarter ended September 30, 2004 that has materially
affected, or is reasonably likely to materially affect, our internal controls
over financial reporting.
3
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)
31.1 Certification under Section 302 of the Sarbanes-Oxley Act of
2002
31.2 Certification under Section 302 of the Sarbanes-Oxley Act of
2002
32.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
- ------------------------
(1) Incorporated by reference from the Form 10-SB filed by the Company on
February 7, 2001
(b) The Company did not file any reports on Form 8-K filed during the
quarter ended September 30, 2004
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 22, 2004 SEA SUN CAPITAL CORPORATION
/s/ Graham Millington
--------------------------------
Graham Millington, President
/s/ Rodney Koch
--------------------------------
Rodney Koch, Chairman
4