U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



Form 10-QSB



(Mark One)



[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT

OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2003

--------------

[_] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT

OF 1934 FOR THE TRANSITION PERIOD FROM _________________ TO _______________



Commission file number 0-29 219

----------

LEGALPLAY ENTERTAINMENT INC.

--------------------------------------------------------------------------------

(Exact name of small business issuer as specified in its charter)



FLORIDA                                   98-0199508

------------------------------------       ---------------------------------

(State or other jurisdiction of                   (I.R.S. Employer

incorporation or organization)                  Identification No.)



SUITE 630 1188 WEST GEOGRIA STREET



VANCOUVER

V6E 4A2

------------------------------------       ---------------------------------

(Address of principal executive offices)                (Zip Code)



(604) 689-5998

--------------------------------------------------------------------------------

(Issuer's telephone number)



________________________________________________________________________________

(Former name, former address and former fiscal year, if changed since last report)



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 registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes ___ No  X

---



Applicable only to issuers involved in bankruptcy proceedings during the preceding five years



Check whether the registrant 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.  26,025,000 COMMON SHARES AS NOVEMBER 07, 2003.



Transitional Small Business Disclosure Format

(Check one):

Yes ____ No  X

---













Page
1



---



PART 1 - FINANCIAL INFORMATION



ITEM 1:  FINANCIAL STATEMENTS



LegalPlay Entertainment Inc..

(A Development Stage Company)



INDEX

-----



Consolidated Financial Statements



Consolidated Balance Sheets



Consolidated Statements of Operations



Consolidated Statements of Stockholders' Equity



Consolidated Statements of Cash Flows



Notes to Consolidated Financial Statements







ITEM 2:  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION





OVERVIEW



During the third quarter of 2003,  we initiated our development of an on line skill based gaming system through our subsidiary Skill Poker.com Inc.



We also continued to operate our business through our three subsidiary companies: Casino Marketing S.A., a Costa Rican registered company which performs technical management for our licensees; 564448 BC Ltd., a British Columbia registered company which performs administrative management services to Casino Marketing; and  Skill Poker.com Inc., a Washington state registered company incorporated in January 29, 2003, through which the patent pending Skill Poker system is being developed and through which the Skill Poker system will be operated.



In the past nine months, we focused our resources on our patent pending technology in relation to the game of Skill Poker.  Our plan is to engage in the licensing and operating of Skill Poker card rooms in North America.  We launched the play for fun version of the software which will be used to incorporate the Skill Poker system and continued our development.  We expect full launch during the fourth quarter at www.skillpoker.com. and continue to focus our resources on the development and marketing of the Skill Poker system.  There can be no assurances that we will be successful in launching the Skillpoker.com site or that we will generate any revenue from the launch.



During the second quarter, we received notice from each of our customers, Antico Holdings S.A., Focusnet Capital Inc. and Microgaming Systems Ltd, that they would be discontinuing their software gaming licenses with us.  As such, we do not expect any further revenue from software gaming licensing  in relation to these respective customers .   Management is of the opinion that the discontinuation of the previous licensees reflects the revised strategy to operate only within the confines of U.S. gaming laws. Given the current mandate of the Company to operate legal online gaming sites and in view of the potential passing of new legislation in the US Senate and Congress, we discontinued the software gaming license operations and have presented these results on the financial statements as discontinued operations.



Given the nature of the legislative climate in the United States with respect to the regulation or prohibition of online game through such potential laws as the Kyl Bill and the Bacchus Bill, management is of the opinion that the discontinuation of the previous licensees mirrors our current mandate to become a major participant in online entertainment whilst fully compliant with gaming related legislation.  Our plan is to focus resources on our Skill Poker subsidiary and its related operations.





We recently purchased the source code, customer data and the domain www.DailyHorse.com in relation to a horse handicapping software which will form the basis of an online horse racing portal using a subscription based model for the use of the software.



Our future revenues are dependent on the successful launch and consumer acceptance of the Skill Poker system and as such we will dedicate certain financial resources in this regard. There is no expectation of any further capital expenditures and resources will be

Page
2



---

focused on the further development and marketing of the Skill Poker System.  There can be no assurances that we will be successful in launching our Skill Poker system or that we will be able to generate any revenue in connection with the system.



Our mandate for the foreseeable future is to launch and market the Skill Poker system with a view to achieving consumer acceptance and significant revenue generation. The Skill Poker system was recently launched and is in the final stages of beta testing providing cash prizes to players. Since the start of the beta testing period, approximately 2,000 players have registered and peak hour usage of the system totals more than one hundred players at times.  In an effort to increase the level of customer service, effectively market the system and to enlarge the player base we hired a sales consultant recently.



Based on current cash reserves, we are in a position to operate for the next 6 months without any further revenue generation or acquisition of working capital from other sources including debt, equity or a combination thereof.



A significant portion of our resources may be used for the continued litigation with respect to the dispute involving the domain poker.com



THREE-MONTH PERIOD ENDED SEPTEMBER 30, 2003



RESULTS OF CONTINUING OPERATIONS



The following table sets forth for the periods indicated selected information from LegalPlay Entertainment Inc's consolidated financial statements of operations:



|                                              | Three Months           | Three Months              | Nine Months             | Nine Months               
|--------------------------------------------- | ---------------------- | ------------------------- | ----------------------- | --------------------------
|                                              | Ended
September 30     | Ended
September 30        | Ended
September 30      | Ended
September 30        
|                                              | 2003                   | 2002                      | 2003                    | 2002                      
|                                              |                        |                           |                         |                           
|Interest income                               | $                 6 26 | $                       - | $                  8 43 | $                        -
|Operation expenses                            | 202,142                | 224,585                   | 685,092                 | 869,894                   
|Income (Loss) before  discontinued operations | (201,516)              | (224,585)                 | (684,248)               | (869,894)                 
|Income (Loss) from discontinued operations    | (470,110)              | 132,565                   | 209,442                 | 953,603                   
|                                              |                        |                           |                         |                           
|Net (loss) Income during the period           | $        671,626       | $          92,020         | $        (474,807)      | $             83,710      



Information shown is for the nine months ended September 30, 2003 and September 30, 2002 respectively.





RESULTS OF DISCONTINUED OPERATIONS



The results of the casino and poker room sub-license termination have been shown as discontinued operations.  Previously reported financial statements have thus been reclassified.

Revenue from discontinued operations and loss relating to discontinued operations are as follows:



|                                             | Three Months         | Three Months    | Nine Months     | Nine Months    
|-------------------------------------------- | -------------------- | --------------- | --------------- | ---------------
|                                             | Ended                | Ended           | Ended           | Ended          
|                                             | 30-Sep               | 30-Sep          | 30-Sep          | 30-Sep         
|                                             | 2003                 | 2002            | 2003            | 2002           
|Revenue                                      |                      |                 |                 |                
|                                             | $                  - | $       464,022 | $    1,135,233  | $    1,510,091 
|Less:                                        |                      |                 |                 |                
|General Operation expenses                   | 4,085                | 81,457          | 603,606         | 222,322        
|Bad Debt expenses and Written off            | 466,025              | 250,000         | 322,185         | 334,166        
|                                             |                      |                 |                 |                
|Income & (Loss) from discontinued operations | $    (470,110)       | $       132,565 | $       209,442 | $       953,603





NET SALES. Net sales for the three months ended September 30, 2003 was $0 compared to $464,022 for the three months ended September 30, 2002.  This is a result from casino and poker room sub-license termination for 2003.  Licensing revenues were $117,100,  royalty fees were $346,922 for the three months ended September 30, 2002 respectively. We do not expect any continued revenue from these sources after the second quarter.



We expect to enhance our revenue through the launch of our Skill Poker system through our wholly owned subsidiary, Skill Poker.com Inc. We should begin to achieve revenues from the Skill Poker system during the 4th quarter of 2003. These are forward-looking statements, particularly as related to our business plans of the company, within the meaning of Section 27A of the Securities Act of 1933

Page
3



---

and Sections 21E of the Securities Exchange Act of 1934 and are subject to the safe harbor created by these sections. Actual results may differ materially from our expectations and estimates.



OPERATING EXPENSES.  Operating expenses for the three months ended September 30, 2003 were $202,142 compared to $224,585 at September 30, 2002.  The major expense items were for wages, management and consulting fees. Loss from discontinued operations for the three months ended September 30,  2003 was $470,110 compared to the income from discontinued operations for the three months ended September 30, 2002 of $132,565.



PROVISION FOR INCOME TAXES. No tax provision was made for the three months ended September 30, 2003. At December 31, 2002, we had an available net operating loss carry forward of approximately $476,000 that may be used to offset future taxable income.





FINANCIAL CONDITION AND LIQUIDITY



On September 30, 2003, our net working capital was $388,986 compared to a net working capital of $875,695 at September 30, 2002. The current ratio at September 30, 2003 was 5.78 compared to the current ratio at September 30, 2002 of 2.45, the Company currently is in a highly liquid and healthy financial position.  At September 30, 2003 the Company had cash and cash equivalents totaling $348,680 compared to $341,879 at September 30, 2002.



The amount due from Antico Holdings for its license fee and note receivable has been recorded in the amount of $591,268 of which $89,207 represents accounts receivable (net of $578,031 allowance of bad debts which is included into discontinued operation).



Net cash used for operating activities for the nine months ended September 30, 2003 was $7,628.  The decrease in cash was mainly due to developing and marketing the Skill Poker system,legal fees relating to the URL dispute and general office operations.



Net cash used for investing activities for the nine months ended September 30, 2003 was $111,342 for the acquisition of the server and other equipment for the skill poker software including the purchase of the pending patent for $50,000



Net cash provided by financing activities for the nine months ended September 30, 2003 was $9,000.  The increase resulted from stock options exercised.



Item 3. Controls and Procedures.



Within the 273 days prior to the date of this report, we carried out an evaluation, under the supervision and with the participation of our management, including our President, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based upon that evaluation, our President concluded that disclosure controls and procedures are effective in timely alerting the management to material information relating to the Company (including its consolidated subsidiaries) required to be included in our periodic SEC filings.



There have been no significant changes in our internal controls or in other factors that could significantly affect internal controls subsequent to the date we carried out this evaluation.



PART II--OTHER INFORMATION



Item 1. Legal Proceedings





On December 6, 2002, the domain www.poker.com was re-directed without our consent or knowledge by Ala Corp., a company registered under the laws of Antigua and whose principal is Liz Bryce of Vancouver, British Columbia, Canada.  The domain was originally licensed from Ala Corp. to UniNet Technologies Inc. in 1999.   UniNet  immediately sub-licensed the domain to us.  In turn, we sub-licensed the domain to Antico Holdings S.A. of Costa Rica for the operating casino and/or card rooms.  We retained all other rights to the domain name including developing the web site as a portal, marketing casinos and card rooms and other gaming software.



Liz Bryce, through Ala Corp., owns 1,297,900 shares of our common stock or 5.02% of our issued and outstanding common stock.  In addition, Ms. Bryce's parents collectively own 1,105,500 shares or 4.27% of our common stock.  Ms. Bryce, together with her parents, owns directly and indirectly, a total of 2,403,400 shares or 9.29% of our common stock.



Although contemplated in the agreements between Ala Corp. and Uninet and between Uninet and us, Ala Corp. failed to provide Uninet or us with any notice that it was redirecting the domain.  As such, we were unaware of any allegations of contractual breach and management is of the opinion that all obligations as set forth by the terms and conditions of the agreements have been fulfilled and we are not aware of any reason for this dispute.



We have agreed with Uninet to jointly pursue all legal avenues available to retain the exclusive right to use the www.poker.com and to enforce the provisions of the agreement between Ala Corp. and Uninet.

Page
4



---



After the domain was redirected, Ala Corp. transferred the registered owner of the domain to Communications Services Inc., a company registered in Western Samoa and the registrar was changed from California based Verisign Inc. to Australia based Fabulous.com.

Together with Uninet, we applied to The Internet Corporation for Assigned Names and Numbers (ICANN), a governing body which oversees domain registration and use issues, for the purpose of obtaining a decision on the basis of the wrongful redirection of www.poker.com.   ICANN, however, ruled on January 21, 2003 that since the domain is now registered in the name of Communication Services Inc., it could only decide on a dispute between Ala Corp., the previous registered owner of the domain and Communications Services Inc.  Together with Uninet, we did not have any standing to apply for relief with ICANN since neither of us were ever the registered owner of the domain name.



On February 28, 2003, together with Uninet, we sued Communication Services Inc. in the Supreme Court of British Columbia, Canada for a declaration that as a successor and assignee of Ala Corp., Communications is a trustee of the domain name for the benefit of Uninet and us; an accounting for profits earned by Communication through the wrongful use of the domain name; a declaration that Ala and Communication are bound by the License Agreement between Ala and Uninet; a declaration that Uninet and us are entitled to the exclusive use of the domain name.



We recently received notice from the Supreme Court of British Columbia that it has succeeded in having Communication Services Inc. Court Motion heard May, 14, 15 and 16, 2003 dismissed with costs whereby the judgment against Communication Services Inc. determined that LegalPlay Entertainment Inc. established a substantial connection between the claims it is making and the jurisdiction. LegalPlay Entertainment Inc. can therefore pursue its case against Communication Services Inc. in the Supreme Court of British Columbia. Parallel arbitration proceedings against Ala Corp. remain under way



To the knowledge of management, no federal, state or local governmental agency is presently contemplating any proceedings against us.  Other than a described above, no director, executive officer or affiliate thereof or owner of record or beneficially of more than five percent of our common stock is a party adverse to or has a material interest adverse to us in any proceeding.



Item 2. Changes in Securities and Use of Proceeds



i).

As of September 30, 2003, we had authorized 100,000,000 shares of common stock and had 25,875,000 shares issued and outstanding.



ii).

On February 21, 2003, we issued  3,000,000 shares of common stock to Blue Diamond International Inc. for the  acquisition of a provisional patent application on a system of playing poker online known as Skill Poker (based on the closing market price of  $0.035 on the date of issued for a total cost of $105,000).



iii).

On April 14 , 2003, we issued  3,000,000 shares of common stock to Pokersoft Software A.V.V. for the acquisition of a software master license which will incorporate the patent pending Skill Poker system (based on the closing market price of $0.018 on the date of issued for a total cost of $54,000).



iv).

On June 13, 2003, we issued 2,250,000 shares of common stock for services, which were valued at $50,125 (based on the closing market price on the date of agreement signed).  We have recorded such amounts in the accompanying statement of operations.



|Name of grantee   | Number of shares | Relationship with the company | Amount
|----------------- | ---------------- | ----------------------------- | ------
|Randy Peterson    | 500,000          | Consultant                    | 12,500
|Ashley V. Redmond | 875,000          | Consultant                    | 21,875
|Mark Glusing      | 875,000          | Officer                       | 15,750
|Total             |                  |                               |       



i).

During the period ended September 30, 2003, we issued 1,130,000 options under the terms of the 1998 Combined Incentive and Nonqualified stock option plan to employees, officers and directors.  These stock options have no vesting provision, with the exercise price at $0.02 and will expire in one year from the date of issue. On the date of the grant, the market price of the stock was equal to the exercise price.



The following table summarizes the Company's stock option activity for the period:



|                            | Number of Shares | Exercise Price Per Share | Weighted Average Exercise Price
|--------------------------- | ---------------- | ------------------------ | -------------------------------
|                            |                  |                          |                                
|Balance, December 31, 2002  | 510,000          | $                0.02    | $              0.02            
|Granted during the period   | 1,130,000        | $                0.02    | $              0.02            
|Stock option exercised      | (450,000)        | $                0.02    | $              0.02            
|Cancelled during the period | (130,000)        | $                0.02    | $              0.02            
|Balance, September 30, 2003 | 1,060,000        | $                0.02    | $              0.02            



Page5



---





Item 3. Defaults upon Senior Securities



None.



Item 4. Submission of Matters to a Vote of Security Holders



None.



Item 5. Other Information.





Item 6. Exhibits and Reports on Form 8-K



|Exhibit | Description                                                                                                                                                                                         
|------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|5.2*    | Form S8 POS filed August 18th, 2003: Opinion of Roger L. Fidler as to the legality of the Company's Common Stock being registered                                                                   
|10.1    | Acquisition of Patent Pending Technology from Blue Diamond International Inc. dated February 13th, 2003                                                                                             
|10.2    | Master Software Licensing Agreement with Pokersoft Software A.V.V. dated March 31st , 2003                                                                                                          
|10.3    | Consulting Agreement with Randy Peterson dated April 10th , 2003                                                                                                                                    
|10.4    | Consulting Agreement with Ashley V.Redmond dated April 10th , 2003                                                                                                                                  
|23*     | Form S8 POS filed August 18, 2003: Consent of Pannell Kerr Forster                                                                                                                                  
|99.1*   | Form S8 dated June 13, 2003                                                                                                                                                                         
|99.2    | Certification pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley act of 2002 for Mark Glusing, President and Acting Chief Financial Officer of the Company
|99.3*   | Form 8K filed September 12th, 2003                                                                                                                                                                  
|99.4*   | Form 8K filed September 19th, 2003                                                                                                                                                                  

* Previously filed with the SEC.





--------------------------------------------------------------------------------

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



LegalPlay Entertainment Inc.

----------------------------

(Registrant)



Date  November 10, 2003                     /s/ M. Glusing

------------------------       -----------------------------

(Signature)* President



Date __________       _____________________________

(Signature)*

--------------------------------------------------------------------------------



* Print the name and title of each signing officer under his signatures.



Form 10-QSB

Page6



---



SECTION 302 CERTIFICATION





I,  Mark Glusing certify  that:



1.   I have reviewed this quarterly report on Form 10-QSB of LegalPlay Entertainment Inc;



2.   Based on my knowledge, this quarterly report does not contain any untrue

statement of a material fact or omit to state a material fact necessary to

make the statements made, in light of the circumstances under which such

statements were made, not misleading with respect to the period covered by

this quarterly report;



3.   Based on my knowledge, the financial statements, and other financial

information included in this quarterly report, fairly present in all

material respects the financial condition, results of operations and cash

flows of the registrant as of, and for, the periods presented in this

report;



4.   The registrant's and I are responsible for establishing and maintaining

disclosure controls and procedures (as defined in Exchange Act Rules

13a-14 and 15d-14) for the registrant and have:



a)   designed such disclosure controls and procedures to ensure that

material information relating to the registrant, including its

consolidated subsidiaries, is made known to us by others within those

entities, particularly during the period in which this quarterly

report is being prepared;

b)   evaluated the effectiveness of the registrant's disclosure controls

and procedures as of a date within 181 days prior to the filing date of

this quarterly report (the "Evaluation Date"); and

c)   presented in this quarterly report our conclusions about the

effectiveness of the disclosure controls and procedures based on our

evaluation as of the Evaluation Date;



5.   The registrant's and I have disclosed, based on our most recent evaluation,

to the registrant's auditors and the audit committee of registrant's board of

directors (or persons performing the equivalent function):



a)   all significant deficiencies in the design or operation of internal

controls which could adversely affect the registrant's ability to

record, process, summarize and report financial data and have

identified for the registrant's auditors any material weaknesses in

internal controls; and

b)   any fraud, whether or not material, that involves management or other

employees who have a significant role in the registrant's internal

controls; and



6.   The registrant's and I have indicated in this quarterly report whether there

was significant changes in internal controls or in other factors that could

significantly affect internal controls subsequent to the date of our most

recent evaluation, including any corrective actions with regard to significant

deficiencies and material weaknesses.



Date: November 10, 2003

/s/Mark Glusing



President & Acting CFO





Page7



---











LEGALPLAY
ENTERTAINMENT INC.

(Formerly
POKER.COM, INC.)



Consolidated
Financial Statements

September
30, 2003

(U.S.
Dollars)

(Unaudited)













INDEX

Page



Consolidated
Financial Statements





Consolidated
Balance Sheets

1



Consolidated
Statements of Income

2



Consolidated
Statements of Stockholders' Equity

3



Consolidated
Statements of Cash Flows

4



Notes
to Consolidated Financial Statements

5
- 7















---

|LegalPlay
      Entertainment Inc.                                                                                |                     |                   
|----------------------------------------------------------------------------------------------------------------- | ------------------- | ------------------
|(Formerly
      Poker.com, Inc.)                                                                                  |                     |                   
|Consolidated
      Balance Sheets                                                                                 |                     |                   
|Nine Months Ended
      September 30, 2003 and December 31, 2002                                                  |                     |                   
|(U.S. Dollars)                                                                                                    |                     |                   
|(Unaudited)                                                                                                       |                     |                   
|                                                                                                                  |                     |                   
|                                                                                                                  | September
      30, | December
      31,
|                                                                                                                  | 2003                | 2002              
|                                                                                                                  | $                   | $                 
|Assets                                                                                                            |                     |                   
|                                                                                                                  |                     |                   
|Current                                                                                                           |                     |                   
|Cash                                                                                                              | 348,680             | 458,650           
|Accounts
      receivable                                                                                         | 89,207              | 894,635           
|Prepaid
      expenses                                                                                            | 32,532              | -                 
|Total Current Assets                                                                                              | 470,419             | 1,353,285         
|                                                                                                                  |                     |                   
|Long-Term Receivable                                                                                              | -                   | 22,361            
|Property and Equipment                                                                                            | 120,882             | 55,598            
|Intangible Assets                                                                                                 | 205,661             | 55,748            
|                                                                                                                  |                     |                   
|Total Assets                                                                                                      | 796,962             | 1,486,992         
|                                                                                                                  |                     |                   
|Liabilities                                                                                                       |                     |                   
|                                                                                                                  |                     |                   
|Current                                                                                                           |                     |                   
|Accounts payable and
      accrued liabilities                                                                    | 81,433              | 517,833           
|                                                                                                                  |                     |                   
|Total Liabilities                                                                                                 | 81,433              | 517,833           
|                                                                                                                  |                     |                   
|Stockholders' Equity                                                                                              |                     |                   
|                                                                                                                  |                     |                   
|Preferred Stock,
      $0.01 par value, 5,000,000 shares authorized,
      no shares issued and
      outstanding
|Common Stock and
      Paid-In Capital in Excess of $0.01 Par Value                                               |                    
|100,000,000 Shares
      authorized                                                                               |                     |                   
|25,875,000
      (December 31, 2002 - 17,750,000) shares                                                          |                    
|issued and outstanding                                                                                            | 1,843,580           | 1,624,155         
|Treasury Stock, at cost
      - 27,000 shares                                                                     | (6,881)             | (6,881)           
|Subscriptions Received                                                                                            | 32,480              | 32,480            
|Other Comprehensive
      Income                                                                                  | 18,981              | 17,229            
|Deficit accumulated
      during development stage                                                                | (1,172,631)         | (697,824)         
|                                                                                                                  |                     |                   
|Total Stockholders'
      Equity                                                                                  | 715,529             | 969,159           
|                                                                                                                  |                     |                   
|Total Liabilities
      and Stockholders' Equity                                                                  | 796,962             | 1,486,992         





1

---



|LegalPlay
      Entertainment Inc.                       |                                                   |                                                  |            |           
|-------------------------------------------------------- | ------------------------------------------------- | ------------------------------------------------ | ---------- | ----------
|(Formerly
      Poker.com, Inc.)                         |                                                   |                                                  |            |           
|Consolidated
      Statements of Income                  |                                                   |                                                  |            |           
|(U.S.
      Dollars)                                     |                                                   |                                                  |            |           
|(Unaudited)                                              |                                                   |                                                 
|                                                         | Three
      Months Ended
      September
      30 | Nine
      Months Ended
      September
      30
|                                                         | 2003                                              | 2002                                             | 2003       | 2002      
|                                                         | $                                                 | $                                                | $          | $         
|                                                         |                                                   |                                                  |            |           
|Revenues                                                 |                                                   |                                                  |            |           
|                                                         |                                                   |                                                  |            |           
|Interest
      income                                    | 626                                               | -                                                | 843        | -         
|Total Revenues                                           | 626                                               | -                                                | 843        | -         
|                                                         |                                                   |                                                  |            |           
|Expenses                                                 |                                                   |                                                  |            |           
|Corporation
      promotion                              | 4,143                                             | 26,747                                           | 22,793     | 98,726    
|Depreciation
      and amortization                      | 20,810                                            | 7,487                                            | 41,256     | 22,737    
|Insurance                                                | 2,086                                             | 5,811                                            | 14,252     | 17,284    
|Management
      and Consultant fees                     | 85,134                                            | 83,413                                           | 261,233    | 212,099   
|Office
      supplies and services                       | 3,247                                             | 20,937                                           | 24,254     | 57,361    
|Professional
      fees                                  | 14,639                                            | 4,660                                            | 130,678    | 14,039    
|Rent                                                     | 4,673                                             | 9,102                                            | 13,963     | 29,911    
|Wages                                                    | 50,798                                            | 51,514                                           | 135,044    | 262,755   
|Website
      marketing                                  | 6,112                                             | 6,192                                            | 9,492      | 67,096    
|Technical
      support                                  | 10,500                                            | 8,722                                            | 32,127     | 87,886    
|Total Expenses                                           |                                                   | 224,797                                          |            | 841,797   
|                                                         |                                                   |                                                  |            |           
|Income (Loss) before
      discontinued operations       | (201,516)                                         | (224,797)                                        | (684,249)  | (841,797) 
|Income (Loss) from
      discontinued operations(note 2) | (470,110)                                         | 132,565                                          | 209,442    | 953,603   
|Net Loss for the
      period                            | (671,626)                                         | (92,020)                                         | (474,807)  | 83,710    
|                                                         |                                                   |                                                  |            |           
|Income (Loss) Before
      Income Tax                    | (671,626)                                         | (92,020)                                         | (474,807)  | 83,710    
|Income Tax                                               |                                                   |                                                  |            | 37,669    
|Reduction of Income
      Tax on Loss                   
|Carryforward
       Application                          | -                                                 | -                                                | -          | (37,669)  
|                                                         |                                                   |                                                  |            |           
|Net Income (Loss)
      for Period                       | (671,626)                                         | (92,020)                                         | (474,807)  | 83,710    
|                                                         |                                                   |                                                  |            |           
|Weighted Average
      Number of                         |                                                   |                                                  |            |           
|Common Shares
      Outstanding                          | 25,657,250                                        | 17,175,000                                       | 22,467,553 | 17,119,780
|                                                         |                                                   |                                                  |            |           
|Earnings (Loss) Per
      Share                          |                                                   |                                                  |            |           
|Continuing operations                                    | (0.01)                                            | (0.01)                                           | (0.03)     | (0.05)    
|Discontinued operations                                  | (0.02)                                            | 0.01                                             | 0.01       | 0.05      
|                                                         |                                                   |                                                  |            |           





2

---



|LegalPlay
      Entertainment Inc.                                                |                                 |                                
|--------------------------------------------------------------------------------- | ------------------------------- | -------------------------------
|(Formerly
      Poker. com, Inc.)                                                 |                                 |                                
|Consolidated
      Statements of Stockholders' Equity                             |                                
|Nine Month Period
      Ended September 30, 2003 and Year Ended December 31, 2002
|(U.S.
      Dollars)                                                              |                                 |                                
|(Unaudited)                                                                       |                                 |                                
|                                                                                  |                                 |                                
|                                                                                  | September
      30,             | December
      31,             
|                                                                                  | 2003                            | 2002                           
|                                                                                  |                                 |                                
|Shares of Common
      Stock Issued                                               |                                 |                                
|Balance,
      beginning of period                                                | 17,175,000                      | 16,950,000                     
|Issued for                                                                        |                                 |                                
|Acquisition
      of intangible assets                                            | 6,000,000                       | -                              
|Consulting
      & Management Services                                            | 2,250,000                       | -                              
|Cash
      on exercise of options                                                 | 450,000                         | 225,000                        
|Balance,
      end of period                                                      | 25,875,000                      | 17,175,000                     
|                                                                                  |                                 |                                
|Common Stock and
      Paid-in Capital in                                         |                                 |                                
|Excess
      of $0.01 Par Value                                                   |                                 |                                
|Balance,
      beginning of period                                                | $                  1,624,155    | $                  1,590,405   
|Issued
      for                                                                  |                                 |                                
|Acquisition
      of intangible assets                                            | 159,000                         | -                              
|Consulting
      & Management Services                                            | 50,125                          | -                              
|Stock
      option benefit                                                        | 1,300                           | -                              
|Cash
      on exercise of options                                                 | 9,000                           | 33,750                         
|Balance,
      end of period                                                      | $                  1,843,580    | $                  1,624,155   
|                                                                                  |                                 |                                
|Treasury Stock                                                                    |                                 |                                
|Balance,
      beginning of period                                                | $                       (6,881) | $                       (6,881)
|Purchase                                                                          | -                               | -                              
|                                                                                  | $                       (6,881) | $                       (6,881)
|                                                                                  |                                 |                                
|Subscriptions
      Received                                                      |                                 |                                
|Balance,
      beginning of period                                                | $                       32,480  | $                       32,480 
|Subscriptions
      received                                                      | -                               | -                              
|Balance,
      end of period                                                      | $                       32,480  | $                       32,480 
|                                                                                  |                                 |                                
|Other Comprehensive
      Income                                                  |                                 |                                
|Balance,
      beginning of period                                                | $                       17,229  | $                       18,384 
|Foreign
      currency translation gain                                           | 1,752                           | (1,155)                        
|Balance,
      end of period                                                      | $                       18,981  | $                       17,229 
|                                                                                  |                                 |                                
|Deficit Accumulated
      During Development Stage                                |                                
|Balance,
      beginning of period                                                | $                   (697,824)   | $                   (633,960)  
|Net loss
      for period                                                         | (474,807)                       | (63,864)                       
|Balance,
      end of period                                                      | $                (1,172,631)    | $                   (697,824)  
|                                                                                  |                                 |                                
|Total Stockholders'
      Equity                                                  | $                     715,529   | $                     969,159  





3

---



|LegalPlay
      Entertainment Inc.                           |           |         
|------------------------------------------------------------ | --------- | --------
|(Formerly
      Poker. Com, Inc.)                            |           |         
|Consolidated
      Statements of Cash Flows                  |           |         
|Nine
      Month Ended September 30, 2003                    |           |         
|(U.S.
      Dollars)                                         |           |         
|(Unaudited)                                                  |           |         
|                                                             |           |         
|                                                             | 2003      | 2002    
|                                                             | $         | $       
|Operating
      Activities                                   |           |         
|Net
      income (loss)                                      | (474,807) | 83,710  
|Adjustments
      to reconcile net income (loss) to net cash |           |         
|Provided
      (used in) operating activities                |           |         
|Items
      not involved cash:                               |           |         
|Change
      in comprehensive income                         | 1,752     |         
|Written
      off property                                   | 13,889    |         
|Non
      cash payment for consulting services               | 50,125    |         
|Depreciation
      and amortization                          | 41,256    | 39,092  
|Stock
      based compensation                               | 1,300     | 3,170   
|Changes
      in non-cash working capital                    | 358,856   | (55,779)
|Net
      Cash Provided by (Used in) Operating Activities    | (7,628)   | 70,193  
|                                                             |           |         
|Investing
      Activities                                   |           |         
|Purchase
      of intangible assets                          | (50,660)  | -       
|Purchase
      of property and equipment                     | (60,682)  | 1,655   
|Net
      Cash Provided by (Used in) Investing Activities    | (111,342) | 1,655   
|                                                             |           |         
|Financing
      Activities                                   |           |         
|Cash
      Proceeds from issuance of common stock            | 9,000     | 33,750  
|Net
      Cash Provided by Financing Activities              | 9,000     | 33,750  
|                                                             |           |         
|Effect
      of Exchange Rate Changes on Cash                | -         | 66,754  
|                                                             |           |         
|Inflow
      of Cash                                         | (109,970) | 172,352 
|Cash,
      Beginning of Period                              | 458,650   | 169,527 
|                                                             |           |         
|Cash,
      End of Period                                    | 348,680   | 341,879 
|                                                             |           |         
|Supplemental
      Disclosure of Non-Cash Transactions       |           |         
|Assets
      received for share issued                       | 159,000   | -       





4

---

LEGALPLAY
ENTERTAINMENT INC.

(Formerly
Poker.Com, Inc.)

Notes
to Consolidated Financial Statements

Nine
Month Period Ended September 30, 2003

(U.S.
Dollars)

(Unaudited)



1.

BASIS
OF PRESENTATION



These
unaudited financial statements have been prepared in accordance with generally
accepted accounting principles in the United States of America for interim
financial information.  These financial statements are condensed and do not
include all disclosures required for annual financial statements.  The
organization and business of the Company, accounting policies followed by the
Company and other information are contained in the notes to the Company's
audited consolidated financial statements filed as part of the Company's
December 31, 2002 Form 10KSB.



In
the opinion of the Company's management, these financial statements reflect all
adjustments necessary to present fairly the Company's consolidated financial
position as at September 30, 2003 and December 31, 2002 and the consolidated
results of operations and the consolidated statement of cash flows for the nine
months then ended.  The results of operations for the three months and nine
months ended September 30, 2003 are not necessarily indicative of the results to
be expected for the entire fiscal year.



2.
DISCONTINUED OPERATIONS



During
the second quarter, we received notice from each of our customers, Antico
Holdings S.A., Focusnet Capital Inc. and Microgaming Systems Ltd, that they
would be discontinuing their software gaming licenses with us.  As such, we
do not expect any further revenue from software gaming licensing in relation to
these respective customers.   Management is of the opinion that the
discontinuation of the previous licensees reflects the revised strategy to
operate only within the confines of U.S. gaming laws. Given the current mandate
of the Company to operate legal online gaming sites and in view of the potential
passing of new legislation in the US Senate and Congress, we discontinued the
software gaming license operations and have presented these results on the
financial statements as discontinued operations.  The previously reported
financial statements have thus been reclassified.



Revenue
from discontinued operations and loss relating to discontinued operations are as
follows:



Three
        Months
      Three
        Months
      Nine
        Months
      Nine
        MonthsEnded
      Ended
      Ended
      Ended30-Sep
      30-Sep
      30-Sep
      30-Sep2003
      2002
      2003
      2002Revenue$                 -
      $      464,022
      $   1,135,233
      $   1,510,091Less:General
        Operation expenses
      4,085
      81,457
      603,606
      222,322Bad
        Debt expenses and Written off
      466,025
      250,000
      322,185
      334,166Income & (Loss)
        from discontinued operations
      $   (470,110)
      $      132,565
      $      209,442
      $      953,603




3.

STOCKHOLERS'
EQUITY



a)

During
the nine month period ended September 30, 2003, the Company granted a total of
1,130,000 options to directors and employees of the Company of which 1,000,000
stock options expire on January 7, 2004 and 130,000 stock options expire on May
28, 2004. These stock options have no vesting provision and will expire within
one year from the date of issue at an exercise price of $0.02 per share. On
January 7, 2003, the market price of the stock options was equal to the exercise
price. Therefore, no compensation expense was recognized. On May 28, 2003, the
exercise price was $0.01 below the market price, therefore, compensation of
$1,300 was recorded.



5

---

LEGALPLAY
ENTERTAINMENT INC.

(Formerly
Poker.Com, Inc.)

Notes
to Consolidated Financial Statements

Nine
Month Period Ended September 30, 2003

(U.S.
Dollars)

(Unaudited)







b)

The
following table summarizes the Company's stock option activity for the period:



Number
      of Shares
    Exercise
      Price Per Share
    Weighted
      Average Exercise PriceBalance, December 31,
      2002
    510,000
    $
                     0.02
    $
                   0.02Granted during the
      period
    1,130,000
    $
                     0.02
    $
                   0.02Stock option exercised
    (450,000)
    $
                     0.02
    $
                   0.02Cancelled during the
      period
    (130,000)
    $
                     0.02
    $
                   0.02Balance, September 30,
      2003
    1,060,000
    $
                     0.02
    $
                   0.02






c)

Of
the 1,130,000 options, 130,000 were repriced. As a result of this change, these
options became variable and additional compensation expense of $1,300 was
charged to operations.





d)

The
Company applies APB Opinion No. 25 and related interpretations in accounting for
its stock options granted to employees, and accordingly, compensation expense of
$Nil was recognized as wages expense. Had compensation expense been determined
as provided in SFAS 123 using the Black-Scholes option pricing model, the
pro-forma effect on the Company's net income and per share amounts would have
been as follows:



Net loss, as reported
    
    
    $
                 (474,807)Net income (loss),
      pro-forma
    
    
    $
                 (478,761)Net earnings (loss) per
      share, as reported
    
    
    $
                       (0.03)Net earnings (loss) per
      share, pro-forma
    
    
    $
                       (0.01)




The
fair value of each option grant is calculated using the following weighted
average assumption:



Expected life (years)
    
    
    1Interest rate
    
    
    2.67%Volatility
    
    
    97.49%Dividend Yield
    
    
    0.00%






6





---

LEGALPLAY
ENTERTAINMENT INC.

(Formerly
Poker.Com, Inc.)

Notes
to Consolidated Financial Statements

Nine
Month Period Ended September 30, 2003

(U.S.
Dollars)

(Unaudited)



4.

SUBSEQUENT
EVENT





1.   
On
October 25, 2003, the Company entered into an agreement with Richmedia
Technology Inc. to acquire the source code, software application, databases and
all other assets in relation to a system of horse handicapping, result
prediction and race data management.



In
consideration for the acquired assets, the Company paid Richmedia Technology
US$20,000 in total. The Company is the sole owner of the proprietary technology
and will not be required to pay any ongoing royalties to any parties.



2.   
On
November 3, 2003, the company announced that it received notice from the Supreme
Court of British Columbia that it has succeeded in having

Communication Services
Inc. Court Motion heard May, 14, 15 and 16, 2003 dismissed with costs whereby
the judgment against Communication Services Inc. determined that LegalPlay
Entertainment Inc. established a substantial connection between the claims it is
making and the jurisdiction. LegalPlay Entertainment Inc. can therefore pursue
its case against Communication Services Inc. in the Supreme Court of British
Columbia. Parallel arbitration proceedings against Ala Corp. remain under way.













7