---

# UNITED STATESSECURITIES
AND EXCHANGE COMMISSION

# Washington, DC 20549

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# FORM 10-QSB

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[X]    Quarterly Report under Section 13 or Section
15(d) of the Securities Exchange Act 
    
              
          
      of 1934 for the quarterly period ended
March 31, 2005

[  ]    
Transition Report Pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934

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Commission File Number 0-22848

# U.S. Wireless Data, Inc.
(Exact name of small business issuer as specified in its charter)

Delaware
(State of incorporation)

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84-1178691
(IRS Employer
Identification No.)

420 Lexington Avenue, Suite 2450New York, NY 10170
(Address of principal executive offices, including zip code)

(646) 452-6128
(Registrant's Telephone Number, including area code)

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Check whether the
issuer (1) has 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 ninety days.
Yes [   ]     No [X]

As
of May 16, 2005, there were outstanding 4,000,000 shares of the Registrants
Common Stock ($0.01 par value per share).

Transitional Small
Business Disclosure Format.
Yes [  ]     No [X]

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# U.S. WIRELESS
DATA, INC.
TABLE OF CONTENTS

|                                                             | Page
|------------------------------------------------------------ | ----
|PART I -- FINANCIAL INFORMATION                              |     
|ITEM 1.  Financial Statements                                |     
|Consolidated Balance Sheet                                   |     
|Consolidated Statements of Operations                        |     
|Consolidated Statements of Cash Flows                        |     
|Consolidated Statements of Stockholders Equity              |     
|Notes to Consolidated Financial Statements                   |     
|ITEM 2.  Managements Plan of Operation                      |     
|ITEM 3.  Controls and Procedures                             |     
|PART II -- OTHER INFORMATION                                 |     
|ITEM 1.  Legal Proceedings                                   |     
|ITEM 2.  Changes in Securities and Small Business            |     
|Issuer Purchases of Equity Securities                        |     
|ITEM 3.  Defaults Upon Senior Securities                     |     
|ITEM 4.  Submission of Matters to a Vote of Security Holders |     
|ITEM 5.  Other Information                                   |     
|ITEM 6.  Exhibits                                            |     
|SIGNATURES                                                   |     

2

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# Part I  FINANCIAL
INFORMATION

# ITEM 1. Financial
Statements

U.S. WIRELESS
DATA, INC.CONSOLIDATED BALANCE SHEET

|                                                             | March 31, 2005
|------------------------------------------------------------ | --------------
|ASSETS                                                       |               
|Current assets:                                              |               
|Cash and cash equivalents in escrow                          |               
|                                                             |               
|Total assets                                                 |               
|                                                             |               
|                                                             |               
|LIABILITIES AND STOCKHOLDERS EQUITY                         |               
|Current liabilities:                                         |               
|Accrued liabilities                                          |               
|                                                             |               
|Total liabilities                                            |               
|                                                             |               
|Commitments and contingencies                                |               
|Stockholders' equity:                                        |               
|Preferred stock, 1,000,000 shares authorized as of           |               
|March 23, 2005; no shares issued or outstanding              |               
|Common stock, 19,000,000 shares authorized at $.01 par value |               
|as of March 23, 2005; 4,000,000 shares issued and            |               
|outstanding as of March 31, 2005                             |               
|                                                             |               
|Total stockholders' equity                                   |               
|                                                             |               
|Total liabilities and stockholders equity                   |               
|                                                             |               
|                                                             |               

Accompanying
notes are an integral part of the financial statements

3

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U.S. WIRELESS
DATA, INC.CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited)

|                                                   | For the three months endedMarch 31, | For the nine months endedMarch 31, |   |            
|-------------------------------------------------- | ----------------------------------- | ---------------------------------- | - | -----------
|
|Continuing operations                              |                                     |                                    |   |            
|General and administrative expenses                |                                     | $  (254,000                        | ) | $   (89,000
|Interest income                                    |                                     | 0                                  |   | 0          
|Interest expense                                   |                                     | (1,000                             | ) | (231,000   
|Other income (expense)                             |                                     | 49,000                             |   | 50,000     
|                                                   |                                     |                                    |   |            
|Loss before reorganization items                   |                                     | (206,000                           | ) | (270,000   
|Reorganization items                               |                                    
|Gain on sale of shell                              |                                     | 400,000                            |   | 0          
|Professional fees and U.S. Trustee fees            |                                     | (22,000                            | ) | (370,000   
|Rejection of real property lease                   |                                     | 0                                  |   | (462,000   
|Interest income                                    |                                     | 9,000                              |   | 0          
|                                                   |                                     |                                    |   |            
|Income (loss) before                               |                                    
|discontinued operations                            |                                     | 181,000                            |   | (1,102,000 
|                                                   |                                     |                                    |   |            
|Discontinued operations                            |                                    
|Loss from discontinued operations                  |                                     | (58,000                            | ) | (977,000   
|Gain on sale of discontinued operations            |                                     | 5,000                              |   | 0          
|                                                   |                                     |                                    |   |            
|Loss on discontinued operations                    |                                     | (53,000                            | ) | (977,000   
|                                                   |                                     |                                    |   |            
|Net income (loss)                                  |                                     | $    128,000                       |   | $(2,079,000
|                                                   |                                     |                                    |   |            
|                                                   |                                     |                                    |   |            
|Basic and diluted net income (loss) per share (a): |                                    
|Income (loss) before discontinued operations       |                                     | $          0.00                    |   |            
|Loss on discontinued operations                    |                                     | 0.00                               |   |            
|                                                   |                                     |                                    |   |            
|Net income (loss) per share                        |                                     | $          0.00                    |   |            
|                                                   |                                     |                                    |   |            
|                                                   |                                     |                                    |   |            
|Weighted average common shares outstanding,        |                                    
|basic and diluted 4,000,000 - 31, 2005)            |                                     | 4,000,000                          |   |            
|                                                   |                                     |                                    |   |            
|                                                   |                                     |                                    |   |            
|(a) See Note 4                                     |                                    

Accompanying
notes are an integral part of the financial statements

4

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# U.S.
WIRELESS DATA, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)

|                                                           | For the nine months ended March 31, |                  
|---------------------------------------------------------- | ----------------------------------- | -----------------
|
|CASH FLOWS FROM OPERATING ACTIVITIES:                      |                                     |                  
|Net loss                                                   |                                     | $  (895,000      
|Adjustments to reconcile net loss to net cash used in      |                                    
|operating activities:                                      |                                    
|Depreciation and amortization from discontinued operations |                                     | 0                
|Accretion of bridge loan discount                          |                                     | 0                
|Provision for rejected real property lease                 |                                     | 0                
|Amortization of deferred financing costs                   |                                     | 0                
|Provision for doubtful accounts                            |                                     | 53,000           
|Deferred rent                                              |                                     | 0                
|Write-down of inventory                                    |                                     | 0                
|Changes in operating assets and liabilities:               |                                    
|Accounts receivable                                        |                                     | (39,000          
|Due from factor                                            |                                     | 63,000           
|Due from Plan Sponsor                                      |                                     | (400,000         
|Due from winning auction sale bidder                       |                                     | 107,000          
|Inventory                                                  |                                     | 0                
|Deferred cost of revenue                                   |                                     | 0                
|Prepaids and other current assets                          |                                     | 357,000          
|Accounts payable                                           |                                     | 174,000          
|Accrued liabilities                                        |                                     | (486,000         
|Accrued restructuring expense                              |                                     | 0                
|Customer advances                                          |                                     | 0                
|Deferred revenue                                           |                                     | 0                
|Other liabilities                                          |                                     | 0                
|Prepetition liabilities                                    |                                     | (909,000         
|                                                           |                                     |                  
|Net cash (used in) operating activities                    |                                     | (1,975,000       
|                                                           |                                     |                  
|CASH FLOWS FROM INVESTING ACTIVITIES:                      |                                    
|Purchase of property and equipment                         |                                     | 0                
|Decrease in restricted cash                                |                                     | 456,000          
|Transfer to Chapter 11 escrow accounts                     |                                     | (668,000         
|Transfer from Chapter 11 escrow accounts                   |                                     | 1,831,000        
|Transfer to Liquidation Trust                              |                                     | (100,000         
|Transfer to Plan Sponsor escrow account                    |                                     | (100,000         
|Transfer from Plan Sponsor escrow account                  |                                     | 49,000           
|                                                           |                                     |                  
|Net cash provided by investing activities                  |                                     | 1,468,000        
|                                                           |                                     |                  
|CASH FLOWS FROM FINANCING ACTIVITIES:                      |                                    
|Proceeds from DIP loan                                     |                                     | 0                
|Proceeds from bridge loan                                  |                                     | 0                
|Accrued interest on bridge loan                            |                                     | 0                
|Financing costs of bridge loan                             |                                     | 0                
|Proceeds from notes payable                                |                                     | 0                
|Payment of notes payable                                   |                                     | 0                
|Proceeds from Plan Sponsor                                 |                                     | 100,000          
|Costs related to acquisition of shell                      |                                     | (49,000          
|Payments for real estate lease termination                 |                                     | (456,000         
|Payments of obligations under capital lease                |                                     | 0                
|                                                           |                                     |                  
|Net cash (used in) provided by financing activities        |                                     | (405,000         
|                                                           |                                     |                  
|Net (decrease) increase in cash and cash equivalents       |                                     | (912,000         
|Cash and cash equivalents, beginning of period             |                                     | 912,000          
|                                                           |                                     |                  
|Cash and cash equivalents, end of period                   |                                     | $               0
|                                                           |                                     |                  
|                                                           |                                     |                  

Accompanying
notes are an integral part of the financial statements

5

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# U.S. WIRELESS
DATA, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITYFor the year ended June 30, 2004 and the
nine months ended March 31, 2005 (Unaudited)

|                                        | Series C Convertible Preferred Stock | Common Stock | AdditionalPaid-in | Accumulated  | Total Stockholders |             |  
|--------------------------------------- | ------------------------------------ | ------------ | ----------------- | ------------ | ------------------- | ----------- | -
|
|BALANCE AT JUNE 30, 2003                |                                      | 3,548,700    |                   | $ 36,000     |                     | 17,628,716  |  
|Conversion of Series C convertible      |                                     
|preferred stock                         |                                      | (308,500     | )                 | (4,000       | )                   | 514,173     |  
|Issuance of warrants for bridge loan    |                                      | 0            |                   | 0            |                     | 0           |  
|Termination of warrants for bridge loan |                                      | 0            |                   | 0            |                     | 0           |  
|Net income                              |                                      | 0            |                   | 0            |                     | 0           |  
|                                        |                                      |              |                   |              |                     |             |  
|BALANCE AT JUNE 30, 2004                |                                      | 3,240,200    |                   | $ 32,000     |                     | 18,142,889  |  
|Conversion of Series C convertible      |                                     
|preferred stock                         |                                      | (10,000      | )                 | 0            |                     | 16,667      |  
|Cancelation and transfer to             |                                     
|Liquidation Trust for Reorganization    |                                      | (3,230,200   | )                 | $(32,000     | )                   | (18,159,556 | )
|Capital contribution                    |                                      | 0            |                   | 0            |                     | 4,000,000   |  
|Acquisition costs                       |                                      | 0            |                   | 0            |                     | 0           |  
|Net loss                                |                                      | 0            |                   | 0            |                     | 0           |  
|                                        |                                      |              |                   |              |                     |             |  
|BALANCE AT MARCH 31, 2005               |                                      | 0            |                   | $          0 |                     | 4,000,000   |  
|                                        |                                      |              |                   |              |                     |             |  
|                                        |                                      |              |                   |              |                     |             |  

Accompanying
notes are an integral part of the financial statements

6

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# U.S.
WIRELESS DATA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the three and nine months ended March 31, 2005 and 2004
(Unaudited)

NOTE
1  THE COMPANY

U.S.
Wireless Data, Inc. (USWD, the Company, we,
us, our or similar terms) was incorporated in the state
of Colorado on July 30, 1991 and was reincorporated in the state of Delaware on
October 6, 2000. We were operating under the Chapter 11 Proceedings (as defined
below) and as of May 21, 2004, we sold all of our operations in the Auction
Sales (as defined below). Subsequent to the Auction Sales, we had no assets or
operations other than those related to the Chapter 11 Proceedings. Prior to that
time, we were principally engaged in providing wireless transaction delivery and
gateway services to the payment processing industry. On December 27, 2004, the
bankruptcy court confirmed our Amended Plan of Reorganization (the
Plan) and as of the close of business on March 18, 2005, our assets,
liabilities and contingencies were transferred to a Liquidation
Trust (as provided for under the terms of the Plan) and the Company
effectuated the completion of the Reorganization (as defined below), thereby
emerging from the Chapter 11 Proceedings.

Reorganization

On
March 18, 2005 we filed the last of our remaining late filings with the
Securities and Exchange Commission (SEC), and in accordance with the
Plan, as of such date, Trinad Capital, L.P. (Trinad), our Plan
sponsor, became the holder of 93% of our newly issued common stock as further
discussed in the next paragraph below (the Reorganization).

In
accordance with the Plan, Trinad contributed $500,000 in cash to us in exchange
for 93% of the new common stock to be issued under the Plan, with the remaining
7% of the new common stock being issued to the holders of record of our Series C
preferred stock and our common stock as of February 7, 2005, with 3.5% going to
each class. Simultaneously, all of our originally outstanding Series C preferred
stock and common stock were cancelled. Of such $500,000 from Trinad, $100,000
was retained by us to fund the expenses of remaining public and $400,000 was
funded to the USWD Liquidation Trust to pay administrative costs, creditors and,
possibly, a small portion of the liquidation preference. If there is any
remaining cash in the Liquidation Trust, it will be used to settle a small
portion of the aggregate $32,302,000 liquidation preference to which the holders
of our Series C preferred stock are entitled as of February 7, 2005.

Trinad,
a hedge fund dedicated to investing in micro-cap companies, is seeking to raise
additional capital with a view to making us an attractive vehicle with which to
acquire a business. It will then seek a suitable acquisition candidate. No such
business has been identified and we are therefore subject to a number of risks,
including: any acquisition consummated by us may turn out to be unsuccessful;
investors in us will not know what operating business, if any, will be acquired,
including the particular industry in which the business operates, and whether
dilutive financing will be required therewith; the historical operations of a
specific business opportunity may not necessarily be indicative of the potential
for the future; we may acquire a company in the early stage of development
causing us to incur further risks; we may be dependent upon the management of an
acquired business which has not proven its abilities or effectiveness; we will
be controlled by a small number of stockholders and such control could prevent
the taking of certain actions that may be beneficial to other stockholders; our
common stock will likely be thinly traded, and the public market may provide
little or no liquidity for holders of our common stock.

7

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# U.S.
WIRELESS DATA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the three and nine months ended March 31, 2005 and 2004
(Unaudited)

Trinad
has agreed that it will not dispose of any of its common stock until an
acquisition transaction has been consummated and a Current Report on Form 8-K
setting forth the terms of the acquisition and audited financial statements of
the acquisition target have been filed with the SEC.

Additionally,
on March 18, 2005 Robert Ellin became a director and our Chief Executive
Officer, Jay Wolf became a director and our Chief Operating Officer and Chief
Financial Officer and Barry Regenstein became a director. Robert Ellin and Jay
Wolf are the Managing Member and Managing Director of Trinad, respectively,
while Barry Regenstein is an outside consultant to Trinad.

Chapter
11 Proceedings

Since
the Companys inception, the Company has incurred significant losses and
negative cash flow from operations. As of March 18, 2005, we had an accumulated
deficit of approximately $142 million. Managements concerns about capital
led it to take additional steps to cut costs, dispose of operations and, on
March 26, 2004, we filed a voluntary petition for relief under Chapter 11 of the
United States Bankruptcy Code (the Bankruptcy Code) in the United
States Bankruptcy Court for the Southern District of New York (the
Court), in re U.S. Wireless Data, Inc., Case Number 04-12075.

We
were operating as a debtor-in-possession (DIP) under the
jurisdiction of the Court and in accordance with the applicable provisions of
the Bankruptcy Code and orders of the Court (the Chapter 11
Proceedings) until the Reorganization.

On May
11, 2004, we completed the bankruptcy auctions for the sale of (i) our Synapse
point-of-sale gateway business, and (ii) our vending operations (collectively,
the Auction Sales). Transaction Network Services (TNS)
was awarded by the Court as the winning bidder for each of the operations
offered for sale. TNS paid $6 million in cash for our wireless payment
processing business and $3.7 million in cash for our wireless vending business,
for an aggregate purchase price of $9.7 million in cash. The sales to TNS were
completed on May 21, 2004.

On
December 27, 2004, the Court confirmed our Amended Plan of Reorganization (the
Plan). Additional details concerning the Plan are in the Amended
Disclosure Statement filed with the Court in November 2004 in support of the
Plan, the Amended Plan of Reorganization and Order Confirming Amended Plan of
Reorganization, each of which is filed as an exhibit to Form 8-K filed with the
SEC on January 18, 2005.

8

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# U.S.
WIRELESS DATA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the three and nine months ended March 31, 2005 and 2004
(Unaudited)

On
January 19, 2005 we paid approximately $889,000 as an initial payment to
creditors for prepetition liabilities representing approximately 50% of
Allowed Claims.

The
following assets and liabilities from our Balance Sheet as of March 18, 2005
immediately before the Reorganization, along with all contingent assets and
liabilities, were transferred to the Liquidation Trust:

|                                                                 | 
|---------------------------------------------------------------- | 
|ASSETS                                                           | 
|Current assets:                                                  | 
|Cash and cash equivalents                                        | 
|Cash and cash equivalents in escrow                              | 
|Due from Plan Sponsor                                            | 
|Due from winning auction sale bidder                             | 
|Prepaids and other current assets                                | 
|                                                                 | 
|                                                                 | 
|                                                                 | 
|                                                                 | 
|LIABILITIES                                                      | 
|Current liabilities:                                             | 
|Accounts payable                                                 | 
|Accrued liabilities                                              | 
|                                                                 | 
|Total liabilities not subject to compromise                      | 
|Prepetition liabilities subject to compromise                    | 
|                                                                 | 
|Total liabilities                                                | 
|                                                                 | 
|                                                                 | 
|Prepetition liabilities subject to compromise were as follows: | 
|Accounts payable                                                 | 
|Accrued liabilities                                              | 
|Obligation for rejected real property lease                      | 
|                                                                 | 
|                                                                 | 
|                                                                 | 
|                                                                 | 

The
Liquidation Trust is entirely for the benefit of the holders of the Series C
Preferred Stock as of the record date, after payment of administrative costs and
allowed claims in accordance with the provisions of the Plan, and is not an
asset of the Company.

Going
Concern and Liquidity Uncertainties

We
believe that the $100,000 contributed to us by Trinad should be sufficient to
satisfy our monetary needs for the balance of the calendar year and that Trinad
has the financial wherewithal and intent to fund our financial needs to the
extent reasonably necessary. Since our emergence from bankruptcy through the
Reorganization, we have no liabilities related to the Chapter 11 Proceedings, we
do not currently have an operating business and we have extremely limited cash
under new management.

9

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NOTE
2  BASIS OF PRESENTATION

As a
result of (i) the sale of virtually all of our operating assets, and (ii) the
Reorganization; the historical financial statements are irrelevant to any
assessment of our operations on an ongoing basis. Accordingly, readers are
advised not to rely on any historical financial information in considering an
investment in or the disposition of our stock.

Basis
of Consolidation and Auction Sales

Our
consolidated financial statements include the accounts of our former
wholly-owned subsidiary, UNS Corporation, formerly known as NXT Corporation
(NXT). UNS Corporation was dormant during the period July 1, 2003
through its dissolution on December 11, 2003.

During
March 2004, our Board of Directors approved and authorized management to seek
the sale of our operations which were sold in the Auction Sales. We closed the
sales of our operations included in the Auction Sales on May 21, 2004. Such
operations have been classified as discontinued operations in the accompanying
consolidated financial statements.

Basis
of Presentation and Use of Estimates

The
accompanying financial statements have been prepared by us, without an audit. In
the opinion of management, all adjustments have been made, which include normal
recurring adjustments necessary to present fairly the consolidated financial
statements. Operating results for the periods presented are not necessarily
indicative of the operating results for the full year. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with accounting principles generally accepted in the United States of
America have been condensed or omitted. We believe that the disclosures provided
are adequate to make the information presented not misleading. These unaudited
consolidated financial statements should be read in conjunction with the audited
consolidated financial statements and related notes included in our Annual
Report for the year ended June 30, 2004 on Form 10-KSB.

The
preparation of consolidated financial statements in conformity with accounting
principles generally accepted in the United States of America 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 dates of the financial statements and the reported amounts of revenue and
expenses during the reporting period. Actual results could differ from those
estimates.

All of
the common stock that was outstanding prior to March 26, 2004 was cancelled and
new shares of common stock were issued in accordance with the Plan. The
reorganization value of the assets of the emerging entity immediately before the
date of confirmation exceeded the total of all postpetition liabilities and
allowed claims, therefore, the Company did not qualify for fresh start
accounting under SOP 90-7 and continued its basis of accounting.

Reclassifications

Certain
amounts in the prior period financial statements have been reclassified to
conform to the current presentation.

10

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# U.S.
WIRELESS DATA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the three and nine months ended March 31, 2005 and 2004
(Unaudited)

Stock-based
Compensation

We
account for employee stock-based compensation cost using the intrinsic value
method of accounting prescribed by the Accounting Principles Board Opinion No.
25, Accounting for Stock Issued to Employees (APB No.
25). The Company has adopted the disclosure-only provisions of Statement
of Financial Accounting Standards (SFAS) No. 123, Accounting
for Stock Based-Compensation and SFAS No. 148, Accounting for
Stock-Based Compensation  Transition and Disclosure for employee
stock arrangements. Restricted stock or stock awards are recorded as
compensation expense over the vesting period, if any, based on the market value
on the date of grant.

For options
issued to non-employees, we utilize the fair value method prescribed in SFAS No. 123.

Prior
to the effective date of the Plan, we had four fixed stock-based compensation
plans. The exercise price of each option granted pursuant to these plans was
equal to the market price of the Companys common stock on the date of
grant. Accordingly, pursuant to APB No. 25, no compensation cost has been
recognized for such grants. Had compensation cost been determined based on the
fair value at the grant dates for such awards consistent with the method
prescribed by SFAS No. 123, the Companys net loss and loss per share for
the periods indicated would have been as follows:

|                                  | Three months endedMarch 31, | Nine months endedMarch 31, |   |               
|--------------------------------- | --------------------------- | -------------------------- | - | --------------
|
|Income (loss) before discontinued |                             |                            |   |               
|operations                        |                             | $ 181,000                  |   | $   (1,102,000
|Loss on discontinued operations   |                             | (53,000                    | ) | (977,000      
|                                  |                             |                            |   |               
|Net income (loss), as reported    |                             | $ 128,000                  |   | $   (2,079,000
|                                  |                             |                            |   |               
|Deduct: Total stock-based         |                            
|compensation expense determined   |                            
|under fair value based method     |                             | --                         |   | (147,000      
|                                  |                             |                            |   |               
|Pro forma net income (loss)       |                             | $ 128,000                  |   | $   (2,226,000
|                                  |                             |                            |   |               
|                                  |                             |                            |   |               
|Per share, as reported (a)        |                            
|Before discontinued operations    |                             | $          --              |   | $          (a)
|From discontinued operations      |                             | --                         |   | (a)           
|                                  |                             |                            |   |               
|Net income (loss)                 |                             | $          --              |   | $          (a)
|                                  |                             |                            |   |               
|                                  |                             |                            |   |               
|Per share, pro forma (a)          |                            
|Before discontinued operations    |                             | $          --              |   | $          (a)
|From discontinued operations      |                             | --                         |   | (a)           
|                                  |                             |                            |   |               
|Net income (loss)                 |                             | $          --              |   | $          (a)
|                                  |                             |                            |   |               
|                                  |                             |                            |   |               

(a)
See Note 4.

11

---

# U.S.
WIRELESS DATA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the three and nine months ended March 31, 2005 and 2004
(Unaudited)

In
determining the fair value of each option, we used the Black-Scholes
option-pricing model as prescribed by SFAS No. 123 using the following
assumptions: dividend yield of zero, expected volatility of 123%, an average
expected option life of 3.5 years and an average risk-free interest rate of
2.31% for the year ended June 30, 2003. We did not grant options during the year
ended June 30, 2004 or the nine months ended March 31, 2005.

As of
the effective date of the Plan and as provided for under the provisions of the
Plan, all outstanding warrants and options expired worthless.

NOTE
3  AUCTION SALES

Revenues
and loss from the discontinued operations relating to the Auction Sales are as
follows:

|                     | Three months endedMarch 31, | Nine months endedMarch 31, |   |            
|-------------------- | --------------------------- | -------------------------- | - | -----------
|
|Revenues             |                             | $        --                |   | $ 1,433,000
|Loss from operations |                             | (58,000                    | ) | (977,000   

NOTE
4  NET INCOME (LOSS) PER SHARE

Loss
per common share is computed in accordance with the provisions of SFAS No. 128,
Earnings per Share. SFAS No. 128 establishes standards for the
computation, presentation, and disclosure of earnings per share. Basic per share
amounts are computed by dividing the net loss available to common stockholders
by the weighted average number of common shares outstanding during the year.
Diluted per share amounts incorporate the incremental shares issuable upon the
assumed exercise of the Companys stock options and warrants and assumed
conversion of convertible securities. During the periods presented in the
Consolidated Statements of Operations, such incremental amounts have been
excluded from the calculation since their effect would be anti-dilutive. Such
stock options, warrants and conversions could potentially dilute earnings per
share in the future.

As of
the close of business on March 18, 2005, our assets, liabilities and
contingencies were transferred to the Liquidation Trust (as provided for under
the terms of the Plan) and the Company effectuated the completion of the
Reorganization. In addition, all issued and outstanding shares of the
Companys capital stock were cancelled and new shares were issued. The
Companys current operations is not representative nor comparable to that
of the Company prior to March 18, 2005 and, accordingly, loss per share is not
presented for periods prior to March 18, 2005.

12

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# U.S.
WIRELESS DATA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the three and nine months ended March 31, 2005 and 2004
(Unaudited)

NOTE
5  SUPPLEMENTAL CASH FLOW INFORMATION

Supplemental
disclosure of cash flow information:

$0 and
$96,000 was paid in cash for interest for the nine months ended March 31, 2005
and 2004, respectively.

Supplemental
disclosure of non-cash financing and investing activities:

Nine months
ended March 31, 2005

|1. |  | Conversion
of 10,000 shares of Series C Convertible Preferred Stock into 16,667  shares of Common
Stock.
|-- |  | --------------------------------------------------------------------------------------------------------

|2. |  | As
of the effective date of the Plan and as provided for under the provisions of  the Plan,
all outstanding warrants and options expired worthless.
|-- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------

|3. |  | All
originally outstanding Series C preferred stock and common stock were  cancelled upon the
effectuation of the Reorganization.
|-- |  | ---------------------------------------------------------------------------------------------------------------------------------

|4. |  | All
Chapter 11 related assets and liabilities were transferred to the Liquidation Trust.
|-- |  | ----------------------------------------------------------------------------------------

|5. |  | New
common stock aggregating 4,000,000 shares were issued as follows:
|-- |  | ---------------------------------------------------------------------

|o |  | 3,720,000
shares of common stock to Trinad Capital, L.P.
|- |  | --------------------------------------------------------

|o |  | 140,000
shares of common stock prorata to the holders of Series C preferred  shares held as of
February 7, 2005.
|- |  | ----------------------------------------------------------------------------------------------------------------

|o |  | 140,000
shares of common stock prorata to the holders of common shares held as  of February 7,
2005.
|- |  | ----------------------------------------------------------------------------------------------------

Nine months
ended March 31, 2004

|1. |  | Conversion
of 308,500 shares of Series C Convertible Preferred Stock into  514,173 shares of Common
Stock.
|-- |  | ----------------------------------------------------------------------------------------------------------

|2. |  | Issuance
of warrant in connection with the Bridge Loan, exercisable for  10,000,000 shares of
Common Stock valued at $780,000. Amended and restated for  5,000,000 shares on March 26,
2004.
|-- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3. |  | Accretion
of Bridge Loan discount of $282,000.
|-- |  | ----------------------------------------------

|4. |  | Reversal
of $390,000 of debt discount and adjustment of additional paid-in  capital for the same
amount for the amended and restated warrant.
|-- |  | ---------------------------------------------------------------------------------------------------------------------------------------------

NOTE
6  COMMITMENTS AND CONTINGENCIES

In
accordance with the Plan, all commitments and contingencies prior to the
Reorganization were transferred to the Liquidation Trust.

We
have provided a former officer with an indemnity for such persons
assistance with the preparation of this report and other matters.

We are
not currently subject to any material legal proceedings. However, we may from
time to time become a party to legal proceedings arising in the ordinary course
of our business.

13

---

# U.S.
WIRELESS DATA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the three and nine months ended March 31, 2005 and 2004
(Unaudited)

NOTE
7  SETTLEMENT AND RELEASE AGREEMENT REGARDING THE AT&T ACTION

On
February 23, 2005, we entered into a Settlement and Release Agreement (the
Agreement) with Cingular Wireless, LLC (successor in interest to
AT&T Wireless Services, Inc.) in order to settle the previously disclosed
arbitration relating to the AT&T Action between the parties.

The
Agreement was to become effective when all of the following events have
occurred: (a) the Agreement has been fully executed by the parties; (b) we have
submitted the Agreement to the United States Bankruptcy Court for the Southern
District of New York and that court has entered an order (Order)
approving the Agreement; and (c) the period for appealing the Order has expired
and no appeal has been filed or the Order has been affirmed on appeal.

The
Agreement was executed by both parties and was submitted to the bankruptcy court
on March 8, 2005. The court approved the agreement at a hearing held on March
31, 2005.

In
accordance with the Plan, all rights related to, and all obligations arising
from, this matter and the Agreement were transferred to the Liquidation Trust at
the close of business on March 18, 2005.

14

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ITEM
2. MANAGEMENTS PLAN OF OPERATION

Special
Note Regarding Forward-Looking Statements

We
may, in discussions of our future plans, objectives and expected performance in
periodic reports filed by us with the Securities and Exchange Commission
(SEC) (or documents incorporated by reference therein) and in
written and oral presentations made by us, include projections or other
forward-looking statements within the meaning of Section 27A of the Securities
Exchange Act of 1933 or Section 21E of the Securities Act of 1934, as amended.
Such projections and forward-looking statements are based on assumptions, which
we believe are reasonable but are, by their nature, inherently uncertain. You
are cautioned that any such forward looking statements are not guarantees of
future performance and involve risks and uncertainties, and that actual results
may differ materially from those projected in the forward looking statements as
a result of various factors. The factors that might cause such differences
include, among others, the following: (i) our inability to obtain sufficient
cash to fund ongoing obligations and continue as a going concern; (iii) our
ability to carry out our operating strategy; and (iv) other factors including
those discussed below. We undertake no obligation to publicly update or revise
forward looking statements to reflect events or circumstances after the date of
this Quarterly Report on Form 10-QSB or to reflect the occurrence of
unanticipated events.

Overview

U.S.  Wireless
Data,  Inc.  was  incorporated  on July 30, 1991 in the State of Colorado.  On October 6,
2000,  we  reincorporated  in the state of Delaware.  Until May 21, 2004, we were
principally  engaged in providing  wireless  transaction delivery and gateway services to
the payment processing industry.

On
March 26, 2004, we filed a petition for relief under Chapter 11 of the United
States Bankruptcy Code. On May 11, 2004, the United States Bankruptcy Court (the
Court) conducted an auction of our assets and on May 21, 2004, the
sale of all of our assets and operations to Transactional Network Services, Inc.
(TNS) closed. TNS paid $6,000,000 for our wireless payment
processing business and $3,700,000 for our wireless vending business.

On
December 27, 2004, the bankruptcy court confirmed our Amended Plan of
Reorganization (the Plan) and as of the close of business on March
18, 2005, our assets, liabilities and contingencies were transferred to a
Liquidation Trust (as provided for under the terms of the Plan) and
the Company effectuated the completion of the Reorganization (as defined below),
thereby emerging from the Chapter 11 Proceedings.

On
March 18, 2005 we filed the last of our remaining late filings with the
Securities and Exchange Commission (SEC), and in accordance with the
Plan, as of such date, Trinad Capital, L.P. (Trinad), our Plan
sponsor, became the holder of 93% of our newly issued common stock as further
discussed in the next paragraph below (the Reorganization).

15

---

In
accordance with the Plan, Trinad contributed $500,000 in cash to us in exchange
for 93% of the new common stock to be issued under the Plan, with the remaining
7% of the new common stock being issued to the holders of record of our Series C
preferred stock and our common stock as of February 7, 2005, with 3.5% going to
each class. Simultaneously, all of our originally outstanding Series C preferred
stock and common stock were cancelled. Of such $500,000 from Trinad, $100,000
was retained by us to fund the expenses of remaining public and $400,000 was
funded to the USWD Liquidation Trust to pay administrative costs, creditors and,
possibly, a small portion of the liquidation preference. If there is any
remaining cash in the Liquidation Trust, it will be used to settle a small
portion of the aggregate $32,302,000 liquidation preference to which the holders
of our Series C preferred stock are entitled as of February 7, 2005.

As a
result of (i) the sale of virtually all of our operating assets, and (ii) the
Reorganization; the historical financial statements are irrelevant to any
assessment of our operations on an ongoing basis. Accordingly, readers are
advised not to rely on any historical financial information in considering an
investment in or the disposition of our stock.

Discontinued
Operations

During
March 2004, our Board of Directors approved and authorized management to seek
the sale of our operations which were sold in the Auction Sales. In accordance
with accounting principles generally accepted in the United States of America,
we classified our former operations sold in the Auction Sales as discontinued
operations and have eliminated such operations from the discussion that follows
except where indicated.

Managements
Plan of Operation

On
March 18, 2005 we filed the last of our remaining late filings with the
Securities and Exchange Commission (SEC), and in accordance with the
Plan, as of such date, Trinad Capital, L.P. (Trinad), our Plan
sponsor, became the holder of 93% of our newly issued common stock as further
discussed in the next paragraph below (the Reorganization).

Trinad,
a hedge fund dedicated to investing in micro-cap companies, is seeking to raise
additional capital with a view to making us an attractive vehicle with which to
acquire a business. It will then seek a suitable acquisition candidate. No such
business has been identified and we are therefore subject to a number of risks,
including: any acquisition consummated by us may turn out to be unsuccessful;
investors in us will not know what operating business, if any, will be acquired,
including the particular industry in which the business operates, and whether
dilutive financing will be required therewith; the historical operations of a
specific business opportunity may not necessarily be indicative of the potential
for the future; we may acquire a company in the early stage of development
causing us to incur further risks; we may be dependent upon the management of an
acquired business which has not proven its abilities or effectiveness; we will
be controlled by a small number of stockholders and such control could prevent
the taking of certain actions that may be beneficial to other stockholders; our
common stock will likely be thinly traded, and the public market may provide
little or no liquidity for holders of our common stock.

16

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Trinad
has agreed that it will not dispose of any of its common stock until an
acquisition transaction has been consummated and a Current Report on Form 8-K
setting forth the terms of the acquisition and audited financial statements of
the acquisition target have been filed with the SEC.

As a
result of the sale of virtually all of our operating assets, the historical
financial statements are irrelevant to any assessment of our operations on an
ongoing basis. Accordingly, readers are advised not to rely on any historical
financial information in considering an investment in or the disposition of our
stock.

We
believe that the $100,000 contributed to us by Trinad should be sufficient to
satisfy our monetary needs for the balance of the calendar year and that Trinad
has the financial wherewithal and intent to fund our financial needs to the
extent reasonably necessary. Since our emergence from bankruptcy through the
Reorganization, we have no liabilities related to the Chapter 11 Proceedings, we
do not currently have an operating business and we have extremely limited cash
under new management.

As
described more fully above, subsequent to the Reorganization, our plan of
operation is to merge or effect a business combination with a domestic or
foreign private operating entity. We may seek to raise additional capital first
to make ourselves more attractive to acquisition candidates. We believe that
there are perceived benefits to being a reporting company with a
class of publicly-traded securities which may be attractive to private entities.
Other than activities relating to such financing attempting to locate such a
candidate, we do not currently anticipate conducting any operations.

We may
enter into a definitive agreement with a wide variety of private businesses
without limitation as to their industry or revenues. It is not possible at this
time to predict when, if ever, we will enter into a business combination with
any such private company or the industry or the operating history, revenues,
future prospects or other characteristics of any such company. Trinad intends to
raise capital to make us a more attractive acquisition vehicle and then seek a
suitable merger candidate. Trinad has not identified anyone for acquisition at
this juncture.

CRITICAL
ACCOUNTING POLICIES

The
accompanying financial statements have been prepared in accordance with
accounting principles generally accepted in the United States of America.

Estimates
and assumptions

The
preparation of consolidated financial statements in conformity with accounting
principles generally accepted in the United States of America 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 dates of the financial statements and the reported amounts of revenue and
expenses during the reporting period. Actual results could differ from those
estimates.

Financial
Reporting by Entities in Reorganization under the Bankruptcy Code

The
accompanying consolidated financial statements have been prepared in accordance
with Statement of Position 90-7 (SOP 90-7), Financial
Reporting by Entities in Reorganization under the Bankruptcy Code. SOP
90-7 requires that the financial statements for periods subsequent to the
Chapter 11 filing petition distinguish transactions and events that are directly
associated with the reorganization from the ongoing operations of the business.

17

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All of
the common stock that was outstanding prior to March 26, 2004 was cancelled and
new shares of common stock were issued in accordance with the Plan. The
reorganization value of the assets of the emerging entity immediately before the
date of confirmation exceeded the total of all postpetition liabilities and
allowed claims, therefore, the Company did not qualify for fresh start
accounting under SOP 90-7 and continued its basis of accounting.

Revenue
Recognition from Discontinued Operations

The
following discussion relates to our operations prior to the Reorganization at
the close of business on March 18, 2005. We currently have no business
operations and when we acquire or start a business, our revenue recognition
policy will be determined at that time.

We
adopted the provisions of Staff Accounting Bulletin No. 101, Revenue Recognition
in Financial Statements (SAB 101), which provides guidance on the
recognition, presentation and disclosure of revenue in financial statements
filed with the Securities and Exchange Commission. In addition, we follow the
guidance contained in Emerging Issues Task Force position No. 00-21 with respect
to sales arrangements with multiple deliverables.

We
adopted Emerging Issues Task Force (EITF) No. 00-21, Accounting for Revenue
Arrangements with Multiple Deliverables, which is being applied on a prospective
basis. The consensus addresses how to account for arrangements that may involve
the delivery or performance of multiple products, services and/or rights to use
assets. Revenue arrangements with multiple deliverables are required to be
divided into separate units of accounting if the deliverables in the arrangement
meet certain criteria. Arrangement consideration must be allocated among the
separate units of accounting based on their relative fair values. The consensus
also supersedes certain guidance set forth in SEC Staff Accounting Bulletin
Number 101, Revenue Recognition in Financial Statements (SAB 101). SAB 101 was
amended in December 2003 by Staff Accounting Bulletin Number 104 (SAB 104). The
adoption of this pronouncement did not have a material impact on our financial
statements.

We
derived revenue from two primary sources from our discontinued operations:
service fees and product (equipment) sales.

Services.Service fees consist of: (a) one-time, non-refundable service activation
fees; (b) monthly minimum subscription fees for the availability of service; (c)
fees for transactions delivered on wireless or other methods through our hosts;
and (d) other fees, including administration and other fees for certain wireless
services, certain charges for telecommunications connections between us and a
party, and installation fees and expenses. Service fees are generated from our
Synapse Service. Service activation fees are recognized ratably over the
estimated average life of a customer contract. All other service revenues are
recognized as services are provided.

18

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Product
sales.Product sales (i.e., sales of equipment) are primarily derived from
the sale of our proprietary Synapse Enabler and Synapse Adapter products.
Revenues from product sales are recognized upon shipment and acceptance,
although product sales of our Synapse Enabler for Vending are recognized ratably
over the life of the customer contract upon activation.

QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We
currently have no floating rate indebtedness, hold no derivative instruments,
and do not earn foreign-sourced income. Accordingly, changes in interest rates
or currency exchange rates do not generally have a direct effect on our
financial position. Changes in interest rates may affect the amount of interest
we earn on available cash balances as well as the amount of interest we pay on
borrowings. To the extent that changes in interest rates and currency exchange
rates affect general economic conditions, we may also be affected by such
changes.

ITEM
3. CONTROLS AND PROCEDURES

(a)
Evaluation of Disclosure Controls and Procedures. Our principal executive
officer and principal financial officer, after evaluating the effectiveness of
our disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15d-15(e)) as of the end of the period covered by this Quarterly
Report on Form 10-QSB, have concluded that, based on such evaluation, our
disclosure controls and procedures were adequate and effective to ensure that
material information relating to us, including our consolidated subsidiaries,
was made known to them by others within those entities, particularly during the
period in which this Quarterly Report on Form 10-QSB was being prepared.

(b)
Changes in Internal Controls. There were no significant changes in our
internal control over financial reporting, identified in connection with the
evaluation of such internal control that occurred during our last fiscal
quarter, that have materially affected, or are reasonably likely to materially
affect, our internal control over financial reporting.

19

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PART
II  OTHER INFORMATION

ITEM 1.
LEGAL PROCEEDINGS

On
March 26, 2004, we filed a petition for relief under Chapter 11 of the
Bankruptcy Code with the Court. On May 21, 2004, the Court closed the sale of
all of our assets and operations to TNS. We were operating as a
debtor-in-possession (DIP) under the jurisdiction of the Court and
in accordance with the applicable provisions of the Bankruptcy Code and orders
of the Court (the Chapter 11 Proceedings). On December 27, 2004, the
Court confirmed our Plan and as of the close of business on March 18, 2005, our
assets, liabilities and contingencies were transferred to the Liquidation Trust
(as provided for under the terms of the Plan) and the Company effectuated the
completion of the Reorganization, thereby emerging from the Chapter 11
Proceedings.

On
March 12, 2004, we were served with a complaint filed by U.S.A. Technologies,
Inc. in the District Court for the District of Delaware, alleging infringement
of one patent relating to certain aspects of our technology to enable vending
machines to accept credit cards and seeking unspecified damages and injunctive
relief. We believe this suit is without merit and intended to vigorously defend
such action. The suit had been stayed by virtue of our bankruptcy filing and was
subject to the Chapter 11 Proceedings. In conjunction with the Reorganization,
the suit was transferred to the Liquidation Trust in accordance with the Plan.

We are
not currently subject to any other material legal proceedings. However, we may
from time to time become a party to legal proceedings arising in the ordinary
course of our business.

ITEM 2.
CHANGES IN SECURITIES AND SMALL BUSINESS ISSUER  PURCHASES OF EQUITY SECURITIES

In
conjunction with the Reorganization, all of the common stock and Series C
preferred stock that was outstanding prior to March 26, 2004 was cancelled and
new shares of common stock were issued in accordance with the Plan.

ITEM
3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

20

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ITEM 5.
OTHER INFORMATION

Reconstituted
Board of Directors and Officers

In
conjunction with the Reorganization, on March 18, 2005 Robert Ellin became a
director and our Chief Executive Officer, Jay Wolf became a director and our
Chief Operating Officer and Chief Financial Officer and Barry Regenstein became
a director. Robert Ellin and Jay Wolf are the Managing Member and Managing
Director of Trinad, respectively, while Barry Regenstein is an outside
consultant to Trinad.

Amended
and Restated Certificate of Incorporation

On
March 23, 2005, we filed an Amended and Restated Certificate of Incorporation
with the State of Delaware, which is included below as an Exhibit to this
filing.

Settlement
and Release Agreement regarding the AT&T Action

On
February 23, 2005, we entered into a Settlement and Release Agreement (the
Agreement) with Cingular Wireless, LLC (successor in interest to
AT&T Wireless Services, Inc.) in order to settle the previously disclosed
arbitration relating to the AT&T Action between the parties.

The
Agreement was to become effective when all of the following events have
occurred: (a) the Agreement has been fully executed by the parties; (b) we have
submitted the Agreement to the United States Bankruptcy Court for the Southern
District of New York and that court has entered an order (Order)
approving the Agreement; and (c) the period for appealing the Order has expired
and no appeal has been filed or the Order has been affirmed on appeal.

The
Agreement was executed by both parties and was submitted to the bankruptcy court
on March 8, 2005. The court approved the agreement at a hearing held on March
31, 2005.

In
accordance with the Plan, all rights related to, and all obligations arising
from, this matter and the Agreement were transferred to the Liquidation Trust.

ITEM
6. EXHIBITS

Exhibit
No. Description of Exhibit

|3 |  | Amended
and Restated Certificate of Incorporation
|- |  | -------------------------------------------------

|31.1 |  | Section
302 Certifications by the Chief Executive Officer
|---- |  | ---------------------------------------------------------

|31.2 |  | Section
302 Certifications by the Chief Financial Officer
|---- |  | ---------------------------------------------------------

|32.1 |  | Section
906 Certifications by the Chief Executive Officer
|---- |  | ---------------------------------------------------------

|32.2 |  | Section
906 Certifications by the Chief Financial Officer
|---- |  | ---------------------------------------------------------

21

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SIGNATURES

In accordance with Section
13 or 15 of the Exchange Act, the Registrant caused this Report to be signed on
its behalf by the undersigned, thereunto duly authorized.

|                    | 
|------------------- | 
|                    | 
|Dated: May 16, 2005 | 
|                    | 
|                    | 
|                    | 
|Dated: May 16, 2005 | 
|                    | 
|                    | 
|                    | 
|                    | 

22

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