U S SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB
(Mark One)

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

[ ] Transitional Report Under Section 13 or 15(d) of the Securities Exchange Act
    of 1934

                   For the fiscal year ended December 31, 2004

                         Commission file number: 0-13628

                              ALPHA SPACECOM, INC.
                              --------------------
             (Exact name of registrant as specified in its charter)

            Nevada                                             13-3183646
            ------                                             ----------
 (State or other jurisdiction of                            (I.R.S. Employer
  incorporation or organization)                           Identification No.)

                                    Room 710
                                Zhou Ji Building
                                No. 16 Ande Road
                               Dongcheng District
                              Beijing, 100011 China
                                011-852-2602-3761
                                -----------------
        (Address, including zip code and telephone number, including area
                    code, of registrant's executive offices)

         Securities registered under Section 12(b) of the Exchange Act:
                                      none
                                      ----

          Securities registered under Section 12(g)of the Exchange Act:

                                  Common Stock
                                  ------------
                                (Title of class)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Securities  Exchange  Act of 1934  during the  preceding  12
months (or for such  shorter  period that the Company was  required to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days. Yes [__] No [_x_] (Continued on Following Page)
<PAGE>

Check if disclosure  of delinquent  filers in response to Item 405 of Regulation
S-B is not contained in this form, and no disclosure  will be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated  by reference  in Part III of this Form 10-KSB or any  amendment to
this Form 10-KSB. [__]

State issuer's revenues for its most recent fiscal year. $0.00

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates  computed by reference to the price at which the common equity
was sold,  or the average bid and asked  price of such  common  equity,  as of a
specified date within the past 60 days: $4,648,157 as of July 26, 2005.

State the number of shares outstanding of each of the issuer's classes of common
equity,  as of the latest  practicable  date:  As of July 26,  2005:  14,085,323
shares of Common Stock were issued and outstanding.

Documents incorporated by reference:  None























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<PAGE>


                                TABLE OF CONTENTS

                            FORM 10-KSB ANNUAL REPORT

                              ALPHA SPACECOM, INC.

                                                                            PAGE
                                                                            ----

Facing Page
Index

PART I
Item 1.  Description of Business...............................................4
Item 2.  Description of Property..............................................10
Item 3.  Legal Proceedings....................................................10
Item 4.  Submission of Matters to a Vote of Security Holders..................13

PART II
Item 5.  Market for the Registrant's Common Equity and
              Related Stockholder Matters.....................................14
Item 6.  Management's Discussion and Analysis of Financial Condition
              and Results of Operations.......................................15
Item 7.  Financial Statements.................................................20
Item 8.  Changes in and Disagreements on Accounting and Financial Disclosure..39
Item 8A. Controls and Procedures..............................................39

PART III
Item 9.  Directors, Executive Officers, Promoters and Control Persons;
              Compliance with Section 16(a) of the Exchange Act...............40
Item 10. Executive Compensation...............................................42
Item 11. Security Ownership of Certain Beneficial Owners and Management.......42
Item 12. Certain Relationships and Related Transactions.......................43

PART IV
Item 13. Exhibits and Reports on Form 8-K.....................................44
Item 14. Principal Accountant Fees and Services...............................46

SIGNATURES....................................................................48


                                                                               3


<PAGE>

                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS.

History

     Alpha Spacecom, Inc., formerly, Tridon Enterprises, Inc. ("we, "us," "our,"
or the "Company"),  was  incorporated in the State of Colorado in 1983 under the
name "Turco Computer Systems,  Inc." Prior to the acquisition described below we
were seeking strategic  partnerships  with companies in the satellite  business.
However,  due to the  difficulty  in raising  working  capital  to  execute  our
business plans, we have ceased these operations.

     On December 10, 2001, pursuant to a share exchange  agreement,  we acquired
(the  "Acquisition") from Alpha Sky Investment Limited ("ASI") all of the equity
interests  in both  Accuhigh  Investments  Limited,  a  British  Virgin  Islands
company,  and Tidy Sum Investments Limited, a British Virgin Islands company, in
exchange for 10,000,000 shares of our convertible  preferred stock, which shares
of convertible  preferred stock are convertible into  900,000,000  shares of our
Common Stock. At present,  Accuhigh Investments Limited and Tidy Sum Investments
Limited hold 100% equity interest in Alpha Spacecom Company Limited ("ASC"). For
accounting purposes,  this acquisition has been treated as a recapitalization of
ASI with ASI as the acquirer.  Also on December 10, 2001,  Xuedong Hu, Fung Sien
and Wai Man Yu were appointed as members of our Board of Directors.  Brian Brick
resigned  from the  position of Chief  Executive  Officer.  The  directors  then
elected Xuedong Hu as the Chairman of the Board and Chief Executive  Officer and
appointed Mr. Brian Brick as the Chief Operating  Officer and as a member of the
Board of Directors.  Mr. Brick  resigned his positions with us in February 2005.
On April 1, 2003, Wai Man Yu resigned from the Board and Jian Wang was appointed
in his stead, effective May 26, 2003. See "PART III, Item 9," below.

Subsequent Event/Control of Company

     Shareholders and potential  investors should be advised that, since October
2004, there has been an ongoing dispute concerning control of our Company.  This
dispute has resulted in two separate lawsuits being filed. See "PART I, Item 3,"
below for a  detailed  description  of these  actions  and the  results  arising
therefrom.

     In June 2005, we conducted a special  meeting of  shareholders  pursuant to
notice. At this meeting, we accomplished the following:

     1. We merged with a newly formed Nevada corporation,  Alpha Spacecom, Inc.,
in order to reincorporate our Company in the State of Nevada;

     2. Our shareholders adopted a reverse stock split, whereby one (1) share of
Common  Stock was issued in exchange  for every ten (10) shares of Common  Stock
(the "Reverse Stock Split")  outstanding prior to this reverse stock split, with
the number of shares of Common Stock

                                                                               4
<PAGE>

authorized  following  this  reverse  stock  split  to  remain  the  same as was
authorized immediately prior to the Reverse Stock Split; and

     3. Our  shareholders  elected  three  directors,  including  Jian  Wang and
Xuedong Hu, each of whom were  previously  directors  of our  Company,  and Rain
Zhang.  Following  this  meeting,  our Board of Directors  elected Mr. Hu as our
Chairman,  Chief Executive Officer,  President and Chief Financial Officer;  Mr.
Wang as our Chief Operating Officer; and Ms. Zhang as our Secretary.

     This report and the  contents  thereof has been  prepared by Mr. Hu, in his
capacity as our CEO, President,  CFO and principal  shareholder,  as well as the
Chairman  of our  Board of  Directors  and by Mr.  Wang,  in his  capacity  as a
director of our Company. Our former third director,  Mr. Sien, was not consulted
concerning  the contents of this  Report,  as Mr.  Sien,  along with others,  is
primarily responsible for disputing the issue of control. In drafting and filing
this  Report,  Messrs.  Hu and Wang  have  relied  upon an Order  issued  by the
Colorado  District Court,  wherein their current positions with our Company have
been  confirmed in March 2005. In that Order,  the Court  confirmed that a Board
meeting held in October 2004 lacked a quorum,  and Messrs.  Hu and Wang were not
removed from their respective Board seats or officer  positions at that meeting.
In  deciding  this  issue,  the Court  reviewed  our  bylaws,  our  articles  of
incorporation,  and  applicable  Colorado  law,  and  determined  that the Board
consisted of four members in October 2004,  and that the two members  present at
such  meeting  did not  constitute  a quorum.  Mr.  Sien and others  continue to
dispute the validity of the Court's  Order and have made  allegations  about the
ownership  of the majority of the Series B Preferred  Convertible  shares of the
Company's stock. (See "Item 3. Legal Proceedings," below).

Description of Business

     We have been a development stage company with very limited operations.  Our
objective  has  previously  been to  develop a Ka band  communication  satellite
system (the "Alphacom  System") that will provide  broadband  telecommunications
services to China and neighboring Asia Pacific countries. If and when completed,
the Alphacom System would have provided a wide  bandwidth,  high data, low cost,
and high efficiency  broadcast and communications  SPPV platform.  We planned to
achieve this  objective by negotiating  agreements  with providers of satellites
and through our in-house  research and development.  However,  as of the date of
this Report and as a result of lack of  operating  capital,  we have  elected to
proceed as described  below and, at least  temporarily,  direct our efforts in a
different direction.

     In March 2000, ASC signed a Memorandum of Understanding  ("MOU") with China
Broadcasting  Film  Television  Satellite  Company,  a division of China's State
Administration of Radio,  Film and Television,  to develop,  construct,  launch,
maintain  and  operate KA band  satellites  for  distribution  of news,  sports,
entertainment  and Satellite  Pay Per View services in the People's  Republic of
China.  The term of the MOU was  extended for one year in March 2001 and expired
in March 2002.

     In December 1999, ASC signed an MOU with Lockheed Martin Corporation. Under
the  terms of the MOU,  Lockheed  Martin  Commercial  Space  Systems  agreed  to
cooperate  with ASC to develop a system design and  commercial  proposal to meet
the  requirements  for ASC's satellite

                                                                               5
<PAGE>

media system.  The MOU was extended seven times before it eventually  expired on
April 30, 2004.

     On July 29, 2003, ASC signed a Cooperation Agreement (the "Agreement") with
China Film Group ("CFG"). Under the Agreement,  ASC and CFG would jointly form a
Joint Venture wherein: a) CFG held 51% of ownership and ASC held 49%, and b) CFG
and ASC invest RMB 200 million and US$30 million,  respectively,  into the Joint
Venture.  On July 29, 2004, the Agreement  expired due to the lack of investment
capital  required to fund the Joint Venture.  No further renewal or extension of
this Agreement or continued negotiations have taken place between ASC and CFG to
date since the expiration of the Agreement.  ASC has never  authorized any other
entity to act on behalf of ASC, or on our behalf, in the development of business
with CFG. Mr. Sien and others have entered into  negotiations with CFG and, upon
information  and belief,  have entered  into a  cooperation  agreement  with CFG
without proper  authorization.  Certain  unauthorized public press releases have
also been issued in part by Mr. Sien through PR Newswire and our web site.  None
of these communications or actions was authorized by our Board of Directors.

     As  a  result,   management   believes  that  without  additional  funding,
implementation of our business plan with CFG is not feasible at this time. As of
the date of this Report, management has begun to seek out other private entities
seeking to enter the public arena in order to either enter into a joint  venture
or merger.  Management is of the belief that our primary  attraction as a merger
partner or acquisition vehicle is our status as a public,  trading company.  Any
business combination or transaction will likely result in a significant issuance
of shares and  substantial  dilution  to our  present  stockholders.  For a more
detailed   description  of  our  new  business  plan,  see  "PART  II,  Item  6,
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations/Plan  of  Operation"  below.   Current   shareholders  and  potential
purchasers of our securities are strongly  cautioned that the current management
decisions may be effected by any  subsequent  resolution of the  management  and
control disputes as more fully described in "PART I, Item 3, Legal Proceedings,"
below.

     Our new business plan is subject to numerous  risk  factors,  including the
following:

     We have a limited operating history,  no revenue and minimal assets and our
independent  accountants have expressed a "going concern" opinion. Our financial
statements  accompanying  this Report have been  prepared  assuming that we will
continue as a going concern,  which  contemplates  the realization of assets and
liquidation  of  liabilities  in the normal  course of business.  The  financial
statements do not include any  adjustment  that might result from the outcome of
this uncertainty. We have had a limited operating history and have not generated
any  revenues or earnings  from  operations.  We have no  significant  assets or
financial  resources.  We will, in all likelihood,  sustain  operating  expenses
without  corresponding  revenues,  at least until the consummation of a business
combination.  This may result in our incurring a net  operating  loss which will
increase  continuously  until we can  consummate a business  combination  with a
profitable business opportunity. There is no assurance that we can identify such
a business opportunity and consummate such a business combination.

     Our proposed  operations are speculative.  The success of our proposed plan
of  operation  will  depend  to a  great  extent  on the  operations,  financial
condition  and  management  of  the  identified  business   opportunity.   While
management  intends  to  seek  business   combination(s)

                                                                               6
<PAGE>

with entities having established operating histories,  there can be no assurance
that we will be successful in locating candidates meeting such criteria.  In the
event we complete a business  combination,  of which there can be no  assurance,
the success of our operations will be dependent upon management of the successor
firm or venture partner firm and numerous other factors beyond our control.

     There is a scarcity of business opportunities and combinations and there is
significant  competition  in this  arena.  We are  and  will  continue  to be an
insignificant  participant  in the  business  of  seeking  mergers  with,  joint
ventures with and acquisitions  of, small private and public  entities.  A large
number of established  and  well-financed  entities,  including  venture capital
firms,  are  active  in  mergers  and  acquisitions  of  companies  which may be
desirable target candidates for us. Nearly all such entities have  significantly
greater financial  resources,  technical  expertise and managerial  capabilities
than  we do and,  consequently,  we will  be at a  competitive  disadvantage  in
identifying  possible  business  opportunities  and  successfully  completing  a
business  combination.  Moreover,  we will also  compete  in  seeking  merger or
acquisition candidates with numerous other small public companies.

     There is no agreement for any business combination or other transaction and
no  standards  for a  business  combination  have been  established.  We have no
arrangement,  agreement  or  understanding  with respect to engaging in a merger
with,  joint venture with or acquisition  of, a private or public entity.  There
can be no assurance we will be successful in identifying and evaluating suitable
business  opportunities or in concluding a business combination.  Management has
not identified any particular  industry or specific  business within an industry
for  evaluation.  There is no  assurance we will be able to negotiate a business
combination on terms  favorable to us. We have not established a specific length
of  operating  history or a specified  level of earnings,  assets,  net worth or
other  criteria  which we will  require a target  business  opportunity  to have
achieved,  and without which we would not consider a business combination in any
form with such business opportunity.  Accordingly,  we may enter into a business
combination with a business opportunity having no significant operating history,
losses, limited or no potential for earnings, limited assets, negative net worth
or other negative characteristics.

     Our  management  will  maintain  control of our  Company  until a merger or
acquisition  is  consummated  and they devote only  limited time to our business
activities.  While  seeking  a  business  combination,   management  anticipates
devoting up to twenty  hours per month to our business  activities.  None of our
officers has entered  into a written  employment  agreement  with us and none is
expected to do so in the foreseeable  future.  We have not obtained key man life
insurance  on any of our  officers or  directors.  Notwithstanding  the combined
limited  experience and time commitment of our management,  loss of the services
of any of these  individuals  could  adversely  affect our  development  and our
likelihood of continuing operations. See "PART III, Item 9. Directors, Executive
Officers,  Promoters and Control  Persons;  Compliance with Section 16(a) of the
Exchange Act."

     Our management  may have conflicts of interest.  Our officers and directors
may in the  future  participate  in  business  ventures  that could be deemed to
compete directly with us.  Additional  conflicts of interest and non-arms length
transactions may also arise in the future in the event our officers or directors
are  involved in the  management  of any firm with which we  transact  business.
Management  has adopted a policy that if we seek a merger with,  or  acquisition

                                                                               7
<PAGE>

of,  any  entity  in which  any  member  of our  management  serve as  officers,
directors or partners,  or in which they or their family members own or hold any
ownership  interest,  such members of  management  shall  abstain from voting in
their respective capacity.

     Reporting  requirements  may delay or preclude an acquisition.  Sections 13
and 15(d) of the Securities  Exchange Act of 1934 (the  "Exchange  Act") require
companies  subject  thereto to provide  certain  information  about  significant
acquisitions, including certified financial statements for the company acquired,
covering  one,  two,  or three  years,  depending  on the  relative  size of the
acquisition.  The time and additional  costs that may be incurred by some target
entities to prepare  such  statements  may  significantly  delay or  essentially
preclude  consummation of an otherwise desirable  acquisition by us. Acquisition
prospects  that  do not  have or are  unable  to  obtain  the  required  audited
statements  may not be  appropriate  for  acquisition  so long as the  reporting
requirements of the Exchange Act are applicable.

     We have neither conducted, nor have others made available to us, results of
market  research  indicating  that  market  demand  exists for the  transactions
contemplated  by us. We do not have,  and do not plan to establish,  a marketing
organization. Even in the event demand is identified for a merger or acquisition
contemplated  by us, there is no assurance we will be  successful  in completing
any such business combination.

     Our  proposed  activities  may be limited to those  engaged in by  business
opportunities which we merge with or acquire. Our proposed  operations,  even if
successful,  will  in all  likelihood  result  in  our  engaging  in a  business
combination with only one business opportunity.  Consequently,  our inability to
diversify  our  activities  into a number of areas may  subject  us to  economic
fluctuations within a particular business or industry and therefore increase the
risks associated with our future operations.

     We may become subject to additional governmental  regulations.  Although we
will be  subject  to  regulation  under  the  Securities  Exchange  Act of 1934,
management  believes we will not be subject to regulation  under the  Investment
Company  Act of 1940,  insofar  as we will not be  engaged  in the  business  of
investing  or  trading  in  securities.  In the  event  we  engage  in  business
combinations that result in our holding passive investment interests in a number
of entities,  we could be subject to regulation under the Investment Company Act
of 1940.  In such event,  we would be  required  to  register  as an  investment
company and could be expected to incur  significant  registration and compliance
costs. We have obtained no formal determination from the Securities and Exchange
Commission  as to our  status  under  the  Investment  Company  Act of 1940 and,
consequently,  any  violation of such Act would  subject us to material  adverse
consequences.

     A business combination involving the issuance of our common shares will, in
all  likelihood,  result  in  shareholders  of a  private  company  obtaining  a
controlling  interest in our Company.  Any business  combination may require our
management  to sell or  transfer  all or a portion of our common  shares held by
them,  or resign as members of our Board of Directors.  The resulting  change in
control could result in removal of one or more present officers and directors of
our  Company  and  a   corresponding   reduction  in  or  elimination  of  their
participation in our future affairs.

                                                                               8
<PAGE>

     There is a significant  chance that consummation of a business  combination
will result in significant  dilution to our existing  shareholders.  Our primary
plan of operation is based upon a business  combination  with a private  concern
that, in all likelihood,  would result in our issuing securities to shareholders
of any such private company. The issuance of previously  authorized and unissued
common  shares would result in  reduction in  percentage  of shares owned by our
present and  prospective  shareholders  and may result in a change in control or
management.

     There are  disadvantages  of a blank  check  offering.  We may enter into a
business  combination  with an entity that desires to establish a public trading
market for its shares. A business opportunity may attempt to avoid what it deems
to be adverse  consequences  of undertaking its own public offering by seeking a
business combination with us. Such consequences may include, but are not limited
to, time delays of the registration process, significant expenses to be incurred
in such an  offering,  loss of voting  control  to public  shareholders  and the
inability or unwillingness to comply with various federal and state laws enacted
for the protection of investors.

     Federal  and state  tax  consequences  will,  in all  likelihood,  be major
considerations  in any business  combination we may undertake.  Currently,  such
transactions  may be  structured  so as to result in tax-free  treatment to both
companies,  pursuant to various federal and state tax  provisions.  We intend to
structure any business  combination  so as to minimize the federal and state tax
consequences  to  both  us and  the  target  entity.  However,  there  can be no
assurance that such business combination will meet the statutory requirements of
a tax-free  reorganization or that the parties will obtain the intended tax-free
treatment upon a transfer of stock or assets.  A  non-qualifying  reorganization
could result in the  imposition of both federal and state taxes that may have an
adverse effect on both parties to the transaction.

     The requirement of audited  financial  statements may disqualify a business
opportunity.  Our management  believes that any potential  business  opportunity
must provide audited financial  statements for review, for the protection of all
parties  to  the  business   combination.   One  or  more  attractive   business
opportunities  may choose to forego the  possibility  of a business  combination
with us rather  than  incur  the  expenses  associated  with  preparing  audited
financial statements.

Trademarks/Tradenames

     We currently do not have any registered trademarks or tradenames,  although
we  expect  this to  change  as we move  towards  the  commercialization  of our
technology.

Government Regulations

     We are not subject to any extraordinary  governmental  regulations relating
to our business.

Employees

     We presently  have three (3) employees Mr. Hu, our CEO, CFO and  President;
Mr. Wang, our Chief Operating  Officer;  and Ms. Zhang,  our Secretary,  none of
whom receive a salary.  See

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<PAGE>

"PART III, Item 9, Directors, Executive Officers, Promoters and Control Persons;
Compliance with Section 16(a) of the Exchange Act" below.

Competition

     We will remain an insignificant  participant among the firms that engage in
the acquisition of business  opportunities.  There are many established  venture
capital and financial  concerns which have  significantly  greater financial and
personnel  resources and technical expertise than we do. In view of our combined
extremely limited financial  resources and limited management  availability,  we
will continue to be at a significant  competitive  disadvantage  compared to our
competitors.

ITEM 2.  DESCRIPTION OF PROPERTY.

     During our fiscal year ended  December 31, 2004 and through  April 2005, we
operated from our previous headquarters in Hong Kong at Room 1305, 13/F Progress
Commercial Building,  7-17 Irving Street, Causeway Bay, Hong Kong, and conducted
our operations at facilities  located in 11B11,  Han Wei Plaza,  No. 7 Guang Hua
Road, Chao Yang District,  Beijing,  China,  which we rented on a month-to-month
basis at $6,846 per month.  This space consisted of 400 square feet of executive
office  space.  Subsequently,  in April 2005,  we moved our  principal  place of
business to the offices of our current  President and Chief  Executive  Officer,
located at Room 710,  Zhou Ji Building,  No. 16 Ande Road,  Dongcheng  District,
Beijing,  100011  China.  This space  consists of 1,660 square feet of executive
office space.  Mr. Hu provides this space to us on a rent-free  basis. See "PART
II, Item 12, Certain Relationships and Related Transactions."

     We have no other properties.

ITEM 3.  LEGAL PROCEEDINGS

     Two legal proceedings  currently exist and are related to the December 2001
Share Exchange Agreement between Tridon  Enterprises  (currently Alpha Spacecom,
Inc.),  Alpha Sky  Investment  Limited,  and Tridon  Trust.  All  references  to
"Tridon"  below  include both of the aforesaid  Tridon  entities who brought the
legal  proceedings.  Each of the below described  matters also involve a dispute
over  the  identity  and  authority  of  our  current   management  and  include
allegations  related  to the  ownership  of  9,777,775  shares  of our  Series B
Preferred  Convertible Stock. The allegations were brought by Mr. Sien and other
individuals,  not by Messrs.  Hu and Wang.  Messrs. Hu and Wang have signed this
Report and have taken the position that they  represent two of the three current
members of our Board of  Directors  and  represent  a  majority  of our Board of
Directors.  Current  shareholders and potential purchasers of our securities are
strongly  cautioned that the matters  described below have not been litigated to
completion  and  investors  should  review  the  details of these  matters  from
independent sources prior to making any investment decisions.

                                                                              10
<PAGE>

Alpha  Spacecom,  Inc. and Tridon Trust v. Xuedong Hu, Jian Wang,  and Alpha Sky
Investment  LTD.,  Case Number 04 CV 9819,  District  Court,  City and County of
Denver, Colorado

     On or about  November  29,  2004,  a law suit was  filed by  Tridon  in the
Colorado District Court located in Denver,  Colorado. The suit was authorized on
our behalf by two of our then four  directors.  The complaint filed in that case
contained  four basic claims:  (1) to have the judge declare that Xuedong Hu and
Jian Wang  resigned  their  positions as directors  by their  conduct  effective
October 15, 2004;  (2) to have the judge  declare that the  remaining  directors
lawfully removed Xuedong Hu as our Chief Executive  Officer,  effective  October
15,  2004;  (3) to have the judge  order the  removal  of Hu and Wang  under the
guidelines of Colorado law for alleged dishonest and fraudulent conduct; and (4)
asking the judge to rescind the December 2001 Share Exchange Agreement.

     After the suit was filed,  Xuedong Hu, pursuant to the laws of the State of
Colorado, issued a written request that we hold a special shareholder meeting to
address several issues.  On or about January 19, 2005, two of our four directors
sent Mr. Hu a letter declining to hold the requested meeting,  stating that they
did not consider him to be a shareholder of our Company.

     On or about January 13, 2005, all three defendants (Hu, Wang and Alpha Sky)
filed a motion to dismiss all four claims. On or about January 26, 2005, Xuedong
Hu filed a motion with the Colorado  District Court under Colorado law to compel
us to hold the requested special shareholder meeting.  Tridon filed responses to
the motions filed by Hu, Wang, and Alpha Sky. The Colorado  District Court Judge
held a hearing  on the  motions  on March 18,  2005.  At the  conclusion  of the
hearing,  the Judge entered an Order and findings orally.  The substance of that
Order was later reduced to writing, and a copy of that Order was attached to our
Form 8-K filed  with the SEC on or about  April 7,  2005.  In part,  that  Order
dismissed  the first two  claims  asserted  by Tridon,  required  us to hold the
requested special shareholder  meeting, and found that Xuedong Hu is entitled to
vote at the special shareholder meeting since he remains the beneficial owner of
more than 82% of our outstanding  securities.  At the conclusion of the hearing,
the Judge also  requested  that the attorney for Mr. Hu, Mr. Wang, and Alpha Sky
prepare a written  form of Order and submit it to the Court.  The written  Order
was ultimately signed by the Judge on March 30, 2005.

     On March 25,  2005,  Tridon  filed a voluntary  notice of  dismissal of its
claims with the Colorado  District  Court.  Subsequent  to the Court's March 30,
2005 written  Order,  Tridon filed a motion asking the Court to vacate its Order
and declare that it lacked  jurisdiction as a result of the notice of dismissal.
In the filings,  Tridon claimed that the voluntary  notice of dismissal  removes
the Court's  authority to sign the written  Order,  and that the oral ruling was
not valid until reduced to writing and signed.  Mr. Hu, Mr. Wang,  and Alpha Sky
filed  responses to the Tridon  filings,  arguing that the Order  entered by the
Court remains  valid.  On May 11, 2005,  the Court issued a second Order stating
that its original Order was entered March 18, 2005, prior to the dismissal,  and
that it retained jurisdiction to sign and enforce its written Order.

     Tridon filed a Notice of Appeal with the Colorado  Court of Appeals on June
15,  2005,  Case No. 05 CA 1244.  Tridon also filed a Petition  for Rule To Show
Cause with the Colorado

                                                                              11
<PAGE>

Supreme Court on June 15, 2005, Case No. 05SA180. On June 22, 2005, the Colorado
Supreme  Court denied the Petition.  The Court of Appeals case remains  pending,
and is in its early stages.

     While that appeal is pending, the Colorado District Court's Orders of March
18, 2005 and May 11, 2005 are in effect.  Those  Orders  provide  that the Board
meeting  removing Mr. Hu and Mr. Wang were not valid, and as a result Mr. Hu was
not properly or lawfully removed as our CEO or a member of the Board. Similarly,
Mr. Wang was not properly or lawfully  removed from our Board of  Directors.  In
reliance upon this Court Order,  Messrs.  Hu and Wang have  continued to perform
their  respective  duties owed to us, including but not limited to executing and
filing this Report.

Tridon Trust v. Xuedong Hu, Alpha Sky Investment Limited, Alpha Spacecom Company
Limited, and Does 1-10, Case No. CV05 3295DT(RCx),  U.S. District Court, Central
District of California

     On May 3, 2005,  Tridon  Trust filed a suit in the Federal  District  Court
located  in Los  Angeles,  California.  Tridon  Trust  is a  shareholder  of our
Company,  and Alpha Spacecom Company Limited is a subsidiary of our Company as a
result of the prior Share Exchange Agreement of December 9, 2001. The suit seeks
damages based upon alleged fraud and misrepresentations  leading up to the Share
Exchange  Agreement  closing.  The suit also seeks to rescind the Share Exchange
Agreement.

     On the date  filed,  Tridon  Trust also asked the Court to enter  temporary
injunctive  relief  requiring  that  Xuedong  Hu  provide  Mr.  Sien or  another
representative  of Alpha Spacecom,  Inc. with the current SEC codes necessary to
file documents  through the EDGAR  electronic  filing  system.  The Judge denied
Tridon's request on May 3, 2005.

     Mr. Hu and Alpha Sky  Investment  Limited  filed a motion to dismiss all of
the  claims  in this  case.  Prior  to the date set for  hearing,  the  attorney
representing  Tridon Trust filed a First Amended Complaint,  changing the claims
and the parties. Alpha Sky Investment Limited and Alpha Spacecom Company Limited
are no longer  defendants,  Alpha Spacecom,  Inc. has been added as a plaintiff,
and the Securities and Exchange Commission has been added as a defendant. We did
not authorize this action.

     The  First  Amended  Complaint  filed in the case  seeks to have the  Court
declare that the actions taken at the June 13, 2005 special  shareholder meeting
were invalid based upon alleged  violations of federal  securities laws relating
to the information  required for a valid proxy  statement.  The allegations also
question  the  ownership  interest  in a  large  block  of  Series  B  Preferred
Convertible  Stock,  9,777,775 shares in total.  These allegations  suggest that
certain  stock powers were signed in favor of Paul  Ebeling,  but do not ask the
Court to address the ownership of the shares in question.

                                                                              12
<PAGE>

     Shareholders and potential  investors are strongly cautioned not to rely on
the lawsuit allegations related to the ownership of the majority of the Series B
Preferred Convertible shares. The allegations are part of the present management
and have not been proven.  The  plaintiffs  in this case also have not asked the
Court to declare the ownership interest in the applicable shares.

     Shareholders  and potential  investors  are also strongly  cautioned not to
rely on the  Schedule  13D filed by Paul  Ebeling or upon prior  press  releases
beginning on March 18, 2005. Mr.  Ebeling  claims to have acquired  ownership of
9,777,775  shares of Series B Preferred  Convertible  Stock through stock powers
effective May 31, 2005. Prior to that time, a press release was issued March 18,
2005 without proper authorization stating that 9.55 million shares of the Series
B Preferred  Convertible stock had been returned by an individual to the Company
and cancelled.  Shareholders  and potential  investors are advised to review all
public information, including the Company's 8-K filing dated July 2, 1999, filed
on July 6, 1999, related to Mr. Ebeling's resignation as an officer and director
of Tridon Enterprises, Inc. Both Mr. Ebeling's claims and the allegations in the
California federal court suit directly conflict with the Colorado District Court
Orders issued March 18, 2005 and May 11, 2005.

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

     No matters were submitted to our shareholders during the three-month period
ended December 31, 2004.

Subsequent Event

     In June 2005, we conducted a special  meeting of  shareholders  pursuant to
notice. At this meeting, we accomplished the following:

     1. We merged with a newly formed Nevada corporation,  Alpha Spacecom, Inc.,
in order to reincorporate our Company in the State of Nevada;

     2. Our shareholders adopted a reverse stock split, whereby one (1) share of
Common  Stock was issued in exchange  for every ten (10) shares of Common  Stock
(the "Reverse Stock Split")  outstanding prior to this reverse stock split, with
the number of shares of Common Stock  authorized  following  this reverse  stock
split to remain  the same as was  authorized  immediately  prior to the  Reverse
Stock Split; and

     3. Our  shareholders  elected  three  directors,  including  Jian  Wang and
Xuedong Hu, each of whom were  previously  directors  of our  Company,  and Rain
Zhang.  Following  this  meeting,  our Board of Directors  elected Mr. Hu as our
Chairman,  Chief Executive Officer,  President and Chief Financial Officer;  Mr.
Wang as our Chief Operating Officer; and Ms. Zhang as our Secretary.

                                                                              13
<PAGE>

                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

     During our fiscal year ended  December 31, 2004, our Common Stock traded on
the   Over-The-Counter   Bulletin  Board  ("OTCBB")  under  the  symbol  "ASPC."
Subsequently,  because of our  failure to timely  file  reports  pursuant to the
Securities Exchange Act of 1934, as amended, with the SEC, we were delisted from
the Bulletin Board. Our Common Stock currently trades on the "pink sheets" under
the symbol  "ASCM." We intend to cause an  application to be filed with the NASD
in the near future to re-list our Common  Stock for trading on the OTCBB once we
are current in our SEC filings.  There can be no assurance that our  application
will be approved by the NASD.

     The following table sets forth the high and low sales prices for the shares
of our Common  Stock as reported on the OTCBB for each  quarterly  period of the
last two fiscal years.  The bid prices listed below represent  prices,  adjusted
for stock  splits,  between  dealers  without  adjustments  for retail  markups,
breakdowns or commissions and may not represent actual transactions.  The prices
listed are  presented  on a  pre-reverse  stock split  basis.  Subsequently,  we
engaged  in a reverse  stock  split  whereby  one (1) share of common  stock was
issued in exchange for every ten (10) shares then issued and outstanding.

                                                   Bid Price
                                          --------------------------
         Quarter Ended                      High               Low
         -------------                    --------           -------

         March 31, 2003                    $0.024            $0.0085
         June 30 , 2003                    $0.034            $0.0085
         September 30, 2003                $0.050            $0.0125
         December 31, 2003                 $0.035            $0.023

         March 31, 2004                    $0.059            $0.025
         June 30, 2004                     $0.081            $0.036
         September 30, 2004                $0.051            $0.025
         December 31, 2004                 $0.07             $0.03

     As of July 26,  2005,  the closing bid price of our Common Stock was $0.33,
which is post reverse stock split.

     (b) Holders.  At December 31, 2004, we had  approximately  3,100 holders of
record,  not including those shares held in "street name." At December 31, 2004,
the transfer  agent and registrar for our Common Stock was  Computershare  Trust
Company,  Inc., Golden,  Colorado.  However, this relationship was terminated in
July 2005 and our new transfer agent is Corporate Stock Transfer,  Inc., Denver,
Colorado.

                                                                              14
<PAGE>

     (c)  Dividends.  We did not pay any  dividends  on our Common or  Preferred
Stock during the two years ended December 31, 2004.  Management does not foresee
that we will have the ability to pay a dividend on our Common or Preferred Stock
in the fiscal year ended  December  31,  2005.  See "PART II, Item 7,  Financial
Statements."

ITEM 6. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

     The following  discussion  should be read in  conjunction  with our audited
financial  statements and notes thereto included herein. In connection with, and
because we desire to take  advantage  of, the "safe  harbor"  provisions  of the
Private  Securities  Litigation Reform Act of 1995, we caution readers regarding
certain forward looking statements in the following  discussion and elsewhere in
this report and in any other statement made by, or on our behalf, whether or not
in future filings with the Securities and Exchange  Commission.  Forward looking
statements are statements not based on historical  information  and which relate
to future  operations,  strategies,  financial  results  or other  developments.
Forward looking  statements are necessarily based upon estimates and assumptions
that are inherently  subject to significant  business,  economic and competitive
uncertainties and  contingencies,  many of which are beyond our control and many
of which,  with  respect to future  business  decisions,  are subject to change.
These  uncertainties and contingencies can affect actual results and could cause
actual results to differ materially from those expressed in any  forward-looking
statements  made by, or on our behalf.  We  disclaim  any  obligation  to update
forward-looking statements.

     During our fiscal year ended  December 31, 2004,  we generated no revenues.
Our operating  expenses,  which consisted  solely of general and  administrative
expenses,  were $52,281 during our fiscal year ended December 31, 2004, compared
to  operating  expenses of $462,137  during our fiscal year ended  December  31,
2003,  a decrease  of  $409,856.  This  decrease  was  primarily a result of our
abandoning of our previous  business plan.  See "PART I, Item I,  Description of
Business"  above,  for a more  detailed  explanation  of our  activities in this
regard.

     As a result,  we  incurred  a net loss of  ($70,418)  (less  than $0.01 per
share),  during our fiscal year ended December 31, 2004,  compared to a net loss
of  ($462,137)  during our fiscal year ended  December 31, 2003 (less than $0.01
per share).  Because we did not generate revenues during the year ended December
31,  2004 and  2003,  the  following  is our Plan of  Operation,  rather  than a
comparison of results of operations.

Plan of Operation

     We intend to seek to acquire assets or shares of an entity actively engaged
in business that generates revenues, in exchange for its securities.  We have no
particular  acquisitions  in mind  but as of the  date of this  Report,  we have
entered into various  discussions  regarding  such a business  combination,  but
there is no  definitive  agreement  with any third  party as of the date of this
Report.

                                                                              15
<PAGE>

     We have no full time paid employees. Our Chief Executive Officer/President,
Chief Operating Officer and our Secretary have each agreed to allocate a portion
of their time to our business activities, without compensation.  They anticipate
that our business plan can be  implemented  by their  devoting  minimal time per
month to our business affairs and, consequently, conflicts of interest may arise
with respect to the limited time commitment by such officers.

General Business Plan

     Our purpose is to seek,  investigate and, if such  investigation  warrants,
acquire an  interest  in business  opportunities  presented  to us by persons or
firms who or which desire to seek the  perceived  advantages  of an Exchange Act
registered, trading corporation. We will not restrict our search to any specific
business,  industry,  or  geographical  location  and  we may  participate  in a
business  venture  of  virtually  any kind or  nature.  This  discussion  of the
proposed business is purposefully  general and is not meant to be restrictive of
our  virtually  unlimited  discretion  to search  for and enter  into  potential
business   opportunities.   Management  anticipates  that  we  may  be  able  to
participate  in only one  potential  business  venture  because we have  nominal
assets  and  limited  financial  resources.  See  "PART II,  Item 7 -  Financial
Statements."  This lack of  diversification  should be  considered a substantial
risk to our  shareholders  because  it will not  permit us to  offset  potential
losses from one venture against gains from another.

     We may seek a  business  opportunity  with  entities  which  have  recently
commenced  operations,  or which wish to utilize the public marketplace in order
to raise additional capital in order to expand into new products or markets,  to
develop a new  product  or  service,  or for other  corporate  purposes.  We may
acquire assets and establish wholly owned  subsidiaries in various businesses or
acquire existing businesses as subsidiaries.

     We  anticipate  that the  selection of a business  opportunity  in which to
participate  will be  complex  and  extremely  risky.  Due to  general  economic
conditions,  rapid  technological  advances  being made in some  industries  and
shortages  of available  capital,  management  believes  that there are numerous
firms seeking the perceived benefits of a publicly registered corporation.  Such
perceived  benefits may include  facilitating  or  improving  the terms on which
additional  equity  financing may be sought,  providing  liquidity for incentive
stock options or similar benefits to key employees, providing liquidity (subject
to restrictions of applicable  statutes) for all shareholders and other factors.
Potentially,  available  business  opportunities  may  occur  in many  different
industries and at various stages of development, all of which will make the task
of  comparative  investigation  and  analysis  of  such  business  opportunities
extremely difficult and complex.

     We have,  and will continue to have, a limited amount of capital with which
to provide the owners of business  opportunities  with any  significant  cash or
other assets.  However,  management  believes we will be able to offer owners of
acquisition  candidates  the  opportunity  to  acquire a  controlling  ownership
interest in a publicly  registered,  trading company without  incurring the cost
and time  required  to  conduct an initial  public  offering.  The owners of the
business  opportunities  will,  however,  incur significant legal and accounting
costs in connection with  acquisition of a business  opportunity,  including the
costs of  preparing  Form  8-K's,  10-K's or

                                                                              16
<PAGE>

10-KSB's,  agreements and related reports and documents. The Securities Exchange
Act of 1934 (the "34 Act") specifically  requires that any merger or acquisition
candidate  comply with all  applicable  reporting  requirements,  which  include
providing  audited  financial  statements  to be  included  within the  numerous
filings  relevant to complying with the 34 Act.  Nevertheless,  our officers and
directors  have not conducted  market  research and are not aware of statistical
data which would  support  the  perceived  benefits  of a merger or  acquisition
transaction for the owners of a business opportunity.

     The analysis of new business  opportunities will be undertaken by, or under
the  supervision  of, our officers and directors,  none of who is a professional
business analyst.  Management intends to concentrate on identifying  preliminary
prospective  business  opportunities  that may be  brought  to  their  attention
through  present  associations  of  our  officers  and  directors,   or  by  our
shareholders.  In analyzing prospective business opportunities,  management will
consider  such matters as the  available  technical,  financial  and  managerial
resources;  working  capital  and  other  financial  requirements;   history  of
operations,  if any;  prospects  for the future;  nature of present and expected
competition;  the quality and  experience  of management  services  which may be
available and the depth of that management;  the potential for further research,
development, or exploration; specific risk factors not now foreseeable but which
then may be  anticipated  to impact our proposed  activities;  the potential for
growth or expansion;  the potential for profit; the perceived public recognition
of acceptance of products,  services, or trades; name identification;  and other
relevant  factors.  Our officers and directors  expect to meet  personally  with
management  and key  personnel  of the  business  opportunity  as part of  their
investigation.  To the extent possible, we intend to utilize written reports and
personal  investigation  to evaluate the above  factors.  We will not acquire or
merge with any company for which audited financial statements cannot be obtained
within a reasonable period of time after closing of the proposed transaction.

     Management, while not especially experienced in matters relating to our new
business,  shall rely upon their own efforts and, to a much lesser  extent,  the
efforts of our shareholders,  in accomplishing our business purposes.  It is not
anticipated  that we  will  utilize  any  outside  consultants  or  advisors  to
effectuate our business purposes described herein. However, if we do retain such
an outside consultant or advisor, any cash fee earned by such party will need to
be  paid by the  prospective  merger/acquisition  candidate,  as we have no cash
assets  with  which to pay such  obligation.  There  have been no  contracts  or
agreements with any outside consultants and none are anticipated in the future.

     We will not  restrict our search for any  specific  kind of firms,  but may
acquire a venture that is in its  preliminary  or  development  stage,  which is
already in operation,  or in essentially  any stage of its corporate life. It is
impossible  to predict at this time the status of any  business  in which we may
become engaged, in that such business may need to seek additional  capital,  may
desire  to  have  its  shares  publicly  traded,  or may  seek  other  perceived
advantages which we may offer.

                                                                              17
<PAGE>

Acquisition of Opportunities

     In implementing a structure for a particular business  acquisition,  we may
become a party to a merger,  consolidation,  reorganization,  joint venture,  or
licensing  agreement  with another  corporation  or entity.  We may also acquire
stock or assets of an existing  business.  On the consummation of a transaction,
it is probable that our present management and shareholders will no longer be in
control of our Company. In addition,  our directors may, as part of the terms of
the acquisition  transaction,  resign and be replaced by new directors without a
vote of our shareholders.

     It is  anticipated  that any securities  issued in any such  reorganization
would be issued in reliance upon exemption from  registration  under  applicable
federal  and  state  securities  laws.  In  some  circumstances,  however,  as a
negotiated element of its transaction, we may agree to register all or a part of
such securities immediately after the transaction is consummated or at specified
times  thereafter.  If  such  registration  occurs,  of  which  there  can be no
assurance,  it  will  be  undertaken  by the  surviving  entity  after  we  have
successfully consummated a merger or acquisition and we are no longer considered
a "shell"  company.  Until  such time as this  occurs,  we will not  attempt  to
register  any  additional  securities.  The issuance of  substantial  additional
securities and their potential sale into any trading market which may develop in
our  securities  may have a depressive  effect on the value of our securities in
the future, if such a market develops, of which there is no assurance.

     While the actual terms of a  transaction  to which we may be a party cannot
be predicted,  it may be expected  that the parties to the business  transaction
will find it  desirable  to avoid the  creation  of a taxable  event and thereby
structure  the  acquisition  in  a  so-called  "tax-free"  reorganization  under
Sections 368(a)(1) or 351 of the Internal Revenue Code (the "Code"). In order to
obtain tax-free  treatment under the Code, it may be necessary for the owners of
the acquired  business to own 80% or more of the voting  stock of the  surviving
entity. In such event, our shareholders would retain less than 20% of the issued
and  outstanding  shares  of  the  surviving  entity,   which  would  result  in
significant dilution in the equity of such shareholders.

     As  part  of our  investigation,  our  officers  and  directors  will  meet
personally  with  management and key personnel,  may visit and inspect  material
facilities,  obtain independent  analysis of verification of certain information
provided,  check  references of  management  and key  personnel,  and take other
reasonable  investigative  measures,  to the  extent  of our  limited  financial
resources and  management  expertise.  The manner in which we  participate in an
opportunity will depend on the nature of the  opportunity,  the respective needs
and desires of us and other parties,  the management of the  opportunity and our
relative negotiation strength and such other management.

     With respect to any merger or acquisition, negotiations with target company
management  is  expected  to focus on the  percentage  of stock which the target
company shareholders would acquire in exchange for all of their shareholdings in
the target company.  Depending upon,  among other things,  the target  company's
assets  and  liabilities,  our  shareholders  will  in  all

                                                                              18
<PAGE>

likelihood hold a substantially  lesser percentage  ownership interest following
any  merger  or  acquisition.   The  percentage  ownership  may  be  subject  to
significant  reduction in the event we acquire a target company with substantial
assets.  Any merger or  acquisition  effected  by us can be  expected  to have a
significant  dilutive  effect  on the  percentage  of  shares  held by our  then
shareholders.

     We will  participate in a business  opportunity  only after the negotiation
and  execution of  appropriate  written  agreements.  Although the terms of such
agreements  cannot be predicted,  generally  such  agreements  will require some
specific  representations  and  warranties by all of the parties  thereto,  will
specify  certain  events of  default,  will  detail the terms of closing and the
conditions  which must be  satisfied  by each of the parties  prior to and after
such  closing,  will  outline  the  manner of  bearing  costs,  including  costs
associated  with our  attorneys  and  accountants,  will set forth  remedies  on
default and will include miscellaneous other terms.

     As stated  hereinabove,  we will not acquire or merge with any entity which
cannot provide  independent  audited  financial  statements  within a reasonable
period of time after closing of the proposed transaction.  We are subject to all
of the  reporting  requirements  included  in  the 34  Act.  Included  in  these
requirements  is the  affirmative  duty to file  independent  audited  financial
statements as part of our Form 8-K to be filed with the  Securities and Exchange
Commission upon consummation of a merger or acquisition,  as well as our audited
financial  statements  included  in its annual  report on Form  10-KSB.  If such
audited  financial  statements  are not  available  at  closing,  or within time
parameters  necessary to insure our compliance  with the  requirements of the 34
Act,  or if the  audited  financial  statements  provided  do not conform to the
representations  made by the candidate to be acquired in the closing  documents,
the  closing  documents  will  provide  that the  proposed  transaction  will be
voidable,  at the discretion of our present  management.  If such transaction is
voided,  the  agreement  will  also  contain  a  provision   providing  for  the
acquisition  entity to reimburse us for all costs  associated  with the proposed
transaction.

Liquidity and Capital Resources

     At December 31, 2004, we had no available cash.

     We have financed our general and administrative  expenses primarily through
advances from officers and  shareholders.  At December 31, 2003, the Company had
$1,345,808 in Director and shareholder advances outstanding that were unsecured,
non-interest  bearing  and due on demand.  Additional  shareholder  advances  of
$176,729 were unsecured and bore interest at 9.5% per annum.

     During 2004, we were advanced  approximately $42,000 by related parties for
general and administrative  expenses. At December 31, 2004, we had $1,388,010 in
Director and shareholder advances outstanding that were unsecured,  non-interest
bearing and due on demand.

     Because  we  are  not  currently  required  to pay  salaries  to any of our
officers or  directors,  management  believes that we have  sufficient  funds to
continue  operations  through the

                                                                              19
<PAGE>

foreseeable  future.  In the event  additional funds are required to allow us to
continue our operations, it is anticipated that these funds will be loaned to us
by  management,  as it is doubtful that we will be able to obtain loans from any
established  financial  institution.  It is  further  anticipated  that  we will
continue to incur expenses without corresponding revenues during the foreseeable
future.

Critical Accounting Policies and Estimates

     We have  identified  critical  accounting  policies  that,  as a result  of
judgments,   uncertainties,   uniqueness  and  complexities  of  the  underlying
accounting standards and operations involved could result in material changes to
our financial  position or results of operations  under different  conditions or
using different assumptions. The most critical accounting policies and estimates
are:

     >    The preparation of 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  date  of the  financial  statements  and the
          reported amounts of revenue and expenses during the reporting  period.
          Actual results could differ from those estimates.

     >    Fair  value of  instruments.  Our  financial  instruments  consist  of
          accounts  receivable,  accounts  payable and long term debt.  The fair
          value of financial instruments approximate their recorded values. Fair
          value of loans payable to  stockholders  and balances of bank lines of
          credit, in the circumstances, are not reasonably determinable.

     Details  regarding our use of these policies and the related  estimates are
described in the accompanying  consolidated  financial statements as of December
31, 2004 and 2003 and for the years ended December 31, 2004 and 2003. During the
year  ended  December  31,  2004,  there  have been no  material  changes to our
critical accounting policies that impacted our consolidated  financial condition
or results of operations.

Inflation

     Although our operations are influenced by general economic  conditions,  we
do not believe that inflation had a material affect on our results of operations
during 2004.

ITEM 7.  FINANCIAL STATEMENTS

                                                                              20
<PAGE>







                              ALPHA SPACECOM, INC.

                        CONSOLIDATED FINANCIAL STATEMENTS

                            December 31, 2004 & 2003




























                                                                              21

<PAGE>




                              ALPHA SPACECOM, INC.
                        Consolidated Financial Statements



                                TABLE OF CONTENTS


                                                                            Page
                                                                            ----

INDEPENDENT AUDITORS' REPORT
De Joya & Company                                                            F-1

REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
Ronald R. Chadwick, P.C.                                                     F-2

FINANCIAL STATEMENTS

         Consolidated balance sheets                                         F-4
         Consolidated statements of operations                               F-5
         Consolidated statements of stockholders' deficit                    F-6
         Consolidated statements of cash flows                               F-7
         Notes to consolidated financial statements                          F-9


                                                                              22

<PAGE>


                          INDEPENDENT AUDITORS' REPORT


To the Board of Directors and Shareholders
Alpha Spacecom Incorporated and Subsidiaries
Hong Kong

We have audited the  accompanying  consolidated  balance sheet of Alpha Spacecom
Incorporated and Subsidiaries (the "Company"),  as of December 31, 2003, and the
related consolidated  statements of operations,  shareholders'  deficit and cash
flows for the year then ended and cumulative  during  development  stage.  These
consolidated  financial  statements  are  the  responsibility  of the  Company's
management.  Our  responsibility is to express an opinion on these  consolidated
financial statements based on our audit.

We conducted our audit in accordance with auditing standards  generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audit to obtain reasonable  assurance about whether the consolidated
financial  statements  are free of  material  misstatement.  An  audit  includes
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  consolidated  financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audit provides a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the  financial  position of Alpha  Spacecom
Incorporated and Subsidiaries,  as of December 31, 2003 and the results of their
operations and their cash flows for the year then ended,  and cumulative  during
development stage in conformity with accounting principles generally accepted in
the United States of America.

The accompanying  consolidated  financial statements have been prepared assuming
the Company will continue as a going concern as discussed in Note 1. The Company
has been in the  development  stage  since its  inception  of  December 9, 1998.
However,  the  Company  has  sustained   substantial   operating  losses  during
development  stage. In addition,  the Company's total  liabilities  exceed total
assets by $1,696,138.  The Company also has a commitment to provide  $30,000,000
(Note 8) in connection  with a Cooperation  Agreement  with the China Film Group
Corporation  (Note  1).  In view  of  these  matters,  the  Company's  continued
existence is dependent upon the Company's  ability to meet its future  financing
requirements, the success of future operations and the ability to raise money to
meet its capital  commitment.  These factors raise  substantial  doubt about the
Company's ability to continue as a going concern.  Management's plans in regards
to those  matters  also are  described in Note 2 to the  consolidated  financial
statements. The consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty.

/s/ De Joya & Company
De Joya & Company
Las Vegas, Nevada
May 17, 2004
                                       F-1

                                                                              23
<PAGE>

                            RONALD R. CHADWICK, P.C.
                           Certified Public Accountant
                        2851 South Parker Road, Suite 720
                             Aurora, Colorado 80014
                             Telephone (303)306-1967
                                Fax (303)306-1944


             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors
Alpha Spacecom, Inc.
Hong Kong

I have audited the  accompanying  consolidated  balance sheet of Alpha Spacecom,
Inc. and Subsidiaries (a development stage company) as of December 31, 2004, and
the related consolidated  statements of operations,  stockholders'  deficit, and
cash  flows for the year then  ended and for the period  from  inception  of the
development  stage (August 19, 1998) through  December 31, 2004. These financial
statements are the responsibility of the Company's management. My responsibility
is to express an opinion on these financial  statements  based on my audit.  The
Company's  financial  statements as of and for the year ended December 31, 2003,
and for the period from  inception of the  development  stage  (August 19, 1998)
through December 31, 2003 were audited by other auditors whose report, dated May
17, 2004, included an explanatory  paragraph  describing going concern issues as
discussed in Note 2 to the financial  statements.  The financial  statements for
the period from  inception of the  development  stage  (August 19, 1998) through
December  31,  2003  reflect a net loss  applicable  to common  stockholders  of
$2,182,384 of the related total.  The other auditors'  report has been furnished
to me, and in my  opinion,  insofar as it relates to the  amounts for such prior
period, is based solely on the report of such other auditors.

Except  as  discussed  in the  following  paragraph,  I  conducted  my  audit in
accordance with the standards of the Public Company  Accounting  Oversight Board
(United  States).  Those standards  require that I plan and perform the audit to
obtain reasonable  assurance about whether the financial  statements are free of
material  misstatement.  An audit includes examining,  on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  I  believe  that my audit  provides  a  reasonable  basis  for my
opinion.

I was unable to verify $464,050 of the $471,101 in accounts  payable included in
the Company's December 31, 2004 consolidated  balance sheet, due to insufficient
accounting  records;  nor was I able to satisfy  myself as to the  existence  or
holders of the $464,050 in accounts payable by other auditing procedures.

In my opinion, except for the effects of such adjustments, if any, as might have
been  determined to be necessary had I been able to examine  evidence  regarding
the $464,050 in accounts payable, the consolidated financial statements referred
to in the first paragraph above present fairly,  in all material  respects,  the
consolidated  financial  position of Alpha  Spacecom,  Inc. and  Subsidiaries at
December 31, 2004, and the  consolidated  results of their  operations and their
cash  flows for the year then  ended and for the period  from  inception  of the
development stage (August 19, 1998) through December 31, 2004 in conformity with
accounting principles generally accepted in the United States of America.

                                       F-2

                                                                              24
<PAGE>

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 2 to the
financial statements,  the Company has suffered recurring losses from operations
and has a working capital deficit and  stockholders'  deficit.  These conditions
raise  substantial  doubt  about its  ability to  continue  as a going  concern.
Management's  plans in regard to these matters are also described in Note 2. The
financial  statements do not include any adjustments  that might result from the
outcome of this uncertainty.

Aurora, Colorado                            s/Ronald R. Chadwick, P.C.
July 12, 2005                               RONALD R. CHADWICK, P.C.








































                                       F-3
                                                                              25

<PAGE>

<TABLE>

                              ALPHA SPACECOM, INC.
                          (A Development Stage Company)
                           CONSOLIDATED BALANCE SHEETS

<CAPTION>
                                                                   Dec. 31, 2004  Dec. 31, 2003
                                                                   -------------  -------------
<S>                                                                 <C>            <C>
ASSETS

   Current assets
         Cash                                                       $        --    $       440
         Other receivables, deposits and prepayments                         --          2,071
                                                                    -----------    -----------
                Total current assets                                         --          2,511
                                                                    -----------    -----------

         Fixed assets, net                                                   --            962
                                                                    -----------    -----------
                                                                             --            962
                                                                    -----------    -----------

   Total Assets                                                     $        --    $     3,473
                                                                    ===========    ===========

LIABILITIES & STOCKHOLDERS' DEFICIT

   Current liabilities
         Accrued payables                                           $   471,101    $   501,345
         Related party advances                                       1,388,010      1,345,808
         Shareholder advances                                                --        176,729
                                                                    -----------    -----------
             Total current liabilties                                 1,859,111      2,023,882
                                                                    -----------    -----------

   Total Liabilities                                                  1,859,111      2,023,882
                                                                    -----------    -----------

   Stockholders' Deficit
         Preferred stock, 20,000,000 shares authorized:
             Series A, $.001 par value; 23,000 shares designated;
                7% cumulative, convertible; 23,000 shares
                issued and outstanding at Dec. 31, 2004 & 2003               23             23
             Series B, $.0001 par value in 2004;
                $.001 par value in 2003;
                10,000,000 shares designated; convertible;
                9,587,111 and 9,626,000 shares issued and
                outstanding at Dec. 31, 2004 & 2003                         959          9,626
         Common stock, $.0001 par value in 2004;
             $.001 par value in 2003;
             2,000,000,000 shares authorized;
             136,038,452 and 119,286,000 shares issued and
              outstanding at Dec. 31, 2004 and 2003                      13,603        119,286
         Common stock subscribed                                        (50,000)
         Additional paid in capital                                     429,106         33,040
         Deficit accumulated during the development stage            (2,252,802)    (2,182,384)
                                                                    -----------    -----------

   Total Stockholders' Deficit                                       (1,859,111)    (2,020,409)
                                                                    -----------    -----------

   Total Liabilities and Stockholders' Deficit                      $        --    $     3,473
                                                                    ===========    ===========

</TABLE>

               The accompanying notes are an integral part of the
                       consolidated financial statements.

                                       F-4

                                                                              26

<PAGE>

<TABLE>
                              ALPHA SPACECOM, INC.
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF OPERATIONS

<CAPTION>
                                                                                    Period From
                                                                                   Aug. 19, 1998
                                                                                   (Inception)
                                                  Year Ended       Year Ended           To
                                                 Dec. 31, 2004    Dec. 31, 2003    Dec. 31, 2004
                                                 -------------    -------------    -------------
<S>                                              <C>              <C>              <C>
Revenue                                          $          --    $          --    $          --
                                                 -------------    -------------    -------------

Operating expenses:
     General and administrative                         52,281          462,137        1,819,768
                                                 -------------    -------------    -------------
                                                        52,281          462,137        1,819,768
                                                 -------------    -------------    -------------

Gain (loss) from operations                            (52,281)        (462,137)      (1,819,768)
                                                 -------------    -------------    -------------
Other income (expense):
     Cost of share exchange                                 --               --         (415,013)
     Interest expense                                  (18,137)              --          (18,137)
     Other                                                  --               --              116
                                                 -------------    -------------    -------------
                                                       (18,137)              --         (433,034)
                                                 -------------    -------------    -------------
Income (loss) before
     provision for income taxes                        (70,418)        (462,137)      (2,252,802)

Provision for income tax                                    --               --               --
                                                 -------------    -------------    -------------

Net income (loss)                                $     (70,418)   $    (462,137)   $  (2,252,802)
                                                 =============    =============    =============
Net income (loss) per share
(Basic and fully diluted)                        $       (0.00)   $       (0.00)
                                                 =============    =============

Weighted average number of
common shares outstanding                          129,336,042      104,868,000
                                                 =============    =============

</TABLE>



               The accompanying notes are an integral part of the
                       consolidated financial statements.

                                       F-5

                                                                              27



<PAGE>

<TABLE>
                              ALPHA SPACECOM, INC.
                          (A Development Stage Company)
                CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT

<CAPTION>
                                                                                                            Deficit
                             Common Stock     Preferred Series A  Preferred Series B                       Accumulated
                                        Par                                   Par      Common              During the     Stock-
                                     Value (1)       ($.001 Par)            Value (1)   Stock     Paid In  Development    holders'
                            Shares    Amount   Shares   Amount     Shares    Amount   Subscribed  Capital     Stage       Deficit
                         ----------- --------  ------ ----------  --------- --------- ----------  -------- -----------  -----------
<S>                      <C>         <C>       <C>    <C>         <C>       <C>       <C>         <C>      <C>          <C>
Balances at
   December 31, 2002      99,119,000 $ 99,119  23,000 $       23  9,833,331 $   9,833 $       --  $     -- $(1,720,247) $(1,611,272)


Sales of commmon stock     1,767,000    1,767      --         --         --        --         --    51,233          --       53,000


Conversion of
   preferred series B     18,400,000   18,400      --         --   (207,331)     (207)        --   (18,193)         --           --

Gain (loss) for the year          --       --      --         --         --        --         --        --    (462,137)    (462,137)
                         ----------- --------  ------ ----------  --------- --------- ----------  -------- -----------  -----------

Balances at
   December 31, 2003     119,286,000 $119,286  23,000 $       23  9,626,000 $   9,626         --  $ 33,040 $(2,182,384) $(2,020,409)

Par value adjustment (1)          -- (107,357)     --         --         --    (8,664)        --   116,021          --           --

Issuance of common
   stock for receivable    1,666,667      166      --         --         --        --    (50,000)   49,834          --           --

Compensatory
   stock issuances        11,585,785    1,158      --         --         --        --         --   230,558          --      231,716

Conversion of
   preferred series B      3,500,000      350      --         --    (38,889)       (3)        --      (347)         --           --

Gain (loss) for the year          --       --      --         --         --        --         --        --     (70,418)     (70,418)
                         ----------- --------  ------ ----------  --------- --------- ----------  -------- -----------  -----------

Balances at
   December 31, 2004     136,038,452 $ 13,603  23,000 $       23  9,587,111 $     959 $  (50,000) $429,106 $(2,252,802) $(1,859,111)
                         =========== ========  ====== ==========  ========= ========= ==========  ======== ===========  ===========

<FN>
(1) $.0001 in 2004 and $.001 in 2003
</FN>

</TABLE>

               The accompanying notes are an integral part of the
                       consolidated financial statements.

                                       F-6

                                                                              28


<PAGE>

<TABLE>
                              ALPHA SPACECOM, INC.
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<CAPTION>
                                                                                Period From
                                                                               Aug. 19, 1998
                                                                                (Inception)
                                                  Year Ended     Year Ended         To
                                                Dec. 31, 2004   Dec. 31, 2003  Dec. 31, 2004
                                                -------------   -------------  -------------
<S>                                             <C>             <C>            <C>
Cash Flows From Operating Activities:
     Net income (loss)                          $     (70,418)  $    (462,137) $  (2,252,802)

     Adjustments to reconcile net loss
     to net cash provided by (used for)
     operating activities:
          Depreciation and amortization                    --          24,065        117,270
          Asset write offs                                962           2,517          3,479
          Bad debts                                        --              --          2,777
          Receivables, deposits & prepayments           2,071          31,098             --
          Cost of share exchange                           --              --        107,093
          Accrued payables                             24,743         160,099        526,088
          Compensatory stock issuances                     --              --            600
                                                -------------   -------------  -------------
             Net cash provided by (used for)
               operating activities                   (42,642)       (244,358)    (1,495,495)
                                                -------------   -------------  -------------

Cash Flows From Investing Activities:
         Fixed asset purchases                             --              --       (120,749)
                                                -------------   -------------  -------------
             Net cash provided by (used for)
               investing activities                        --              --       (120,749)
                                                -------------   -------------  -------------




                          (Continued On Following Page)


         The accompanying notes are an integral part of the consolidated
                             financial statements.

                                       F-7

                                                                              29

<PAGE>

                              ALPHA SPACECOM, INC.
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                         (Continued From Previous Page)
<CAPTION>
                                                                                Period From
                                                                               Aug. 19, 1998
                                                                                (Inception)
                                                  Year Ended     Year Ended         To
                                                Dec. 31, 2004   Dec. 31, 2003  Dec. 31, 2004
                                                --------------  -------------  -------------
<S>                                             <C>             <C>            <C>

Cash Flows From Financing Activities:
     Sales of common stock                                  --         10,000         54,282
     Common stock purchase deposits                         --             --             --
     Related party advances                             42,202        342,902      2,099,169
     Related party repayments                               --       (114,363)      (713,936)
     Shareholder advances                                   --             --        176,729
                                                --------------  -------------  -------------
       Net cash provided by (used for
       financing activities                             42,202        238,539      1,616,244
                                                --------------  -------------  -------------

Net Increase (Decrease) In Cash                           (404)        (5,819)            --

Cash At The Beginning Of the Period                        440          6,259             --
                                                --------------  -------------  -------------

Cash At The End of the Period                   $           --  $         440  $          --
                                                ==============  =============  =============

Schedule of Non-Cash Investing and Financing Activities
-------------------------------------------------------

2003
----
Clearing of liability to related party for $324,271

2004
----
The Company issued 11,585,785 common shares to retire a shareholder advance of
$176,729 plus accrued interest of $54,987, and issued 1,666,667 common shares
for a receivable of $50,000.

Supplemental Disclosure
-----------------------

Cash paid for interest                          $           --  $          --  $          --
Cash paid for income taxes                      $           --  $          --  $          --

</TABLE>

               The accompanying notes are an integral part of the
                       consolidated financial statements.

                                      F-8

                                                                              30
<PAGE>

                      ALPHA SPACECOM, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                   NOTES CONSOLIDATED TO FINANCIAL STATEMENTS

NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Alpha Spacecom,  Inc.  formerly,  Tridon  Enterprises,  Inc. (the "Company") was
incorporated  in the State of  Colorado  in 1983 under the name  Turco  Computer
Systems,  Inc. The Company has conducted limited  operations in the formation of
satellite  communications  partnerships  and is considered a  development  stage
company as more fully defined in Financial  Accounting Standards Board Statement
No.7.  On  December  10,  2001,  pursuant  to the  terms of the  share  exchange
agreement,  the Company acquired from Alpha Sky Investment Limited ("Alpha Sky")
all of its equity  interest in Accuhigh  Investments  Limited,  a British Virgin
Islands  company and Tidy Sum  Investments  Limited,  a British  Virgin  Islands
company  in  exchange  for  10,000,000  shares of  convertible  preferred  stock
convertible into 900,000,000 shares of common stock of Company.  The transaction
resulted in Alpha Sky obtaining a majority voting  interest in the Company.  For
accounting  purposes,  the  transaction  has been treated as an acquisition  and
re-capitalization  of the Company.  The historical financial statements prior to
December 10, 2001 are those of Alpha Sky.

Principles of consolidation
---------------------------

The accompanying consolidated financial statements include the accounts of Alpha
Spacecom, Inc. and its wholly owned subsidiaries.  All intercompany accounts and
transactions have been eliminated in consolidation.

Use of Estimates
----------------

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  reported  amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial  statements and the reported
amounts of revenues and expenses  during the reporting  period.  Actual  results
could differ from those estimates.

Cash and cash equivalents
-------------------------

The Company considers all highly liquid investments with an original maturity of
three months or less as cash equivalents.

Property and equipment
----------------------

Property and equipment are recorded at cost and  depreciated  under the straight
line method over each item's  estimated  useful  life.  At December 31, 2003 the
Company had $9,836 in leasehold improvements,  equipment and furniture which was
offset by $8,874 in accumulated  depreciation and  amortization,  for a net book
value of $962.  These assets were written off in 2004.  Depreciation  expense in
2003 was $24,065.


                                       F-9

                                                                              31
<PAGE>

                      ALPHA SPACECOM, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                   NOTES CONSOLIDATED TO FINANCIAL STATEMENTS

NOTE 1. ORGANIZATION,  OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued):

Revenue recognition
-------------------

Revenue is recognized on an accrual basis as earned under contract terms.

Income tax
----------

The Company  accounts for income taxes under  Statement of Financial  Accounting
Standards No. 109 ("SFAS 109").  Under SFAS 109 deferred taxes are provided on a
liability  method  whereby  deferred tax assets are  recognized  for  deductible
temporary   differences  and  operating  loss  carryforwards  and  deferred  tax
liabilities  are  recognized  for  taxable  temporary   differences.   Temporary
differences  are the  differences  between  the  reported  amounts of assets and
liabilities and their tax bases.  Deferred tax assets are reduced by a valuation
allowance  when, in the opinion of  management,  it is more likely than not that
some portion or all of the  deferred  tax assets will not be realized.  Deferred
tax assets and  liabilities  are adjusted for the effects of changes in tax laws
and rates on the date of enactment.

Net income (loss) per share
---------------------------

The net income (loss) per share is computed by dividing the net income (loss) by
the weighted  average number of shares of common  outstanding.  Warrants,  stock
options,  and  common  stock  issuable  upon  the  conversion  of the  Company's
preferred  stock (if any),  are not  included in the  computation  if the effect
would be  anti-dilutive  and would  increase the  earnings or decrease  loss per
share.

Financial Instruments
---------------------

The carrying value of the Company's  financial  instruments,  as reported in the
accompanying balance sheets, approximates fair value.

Long-Lived Assets
-----------------

In accordance  with Statement of Financial  Accounting  Standard 144 "Accounting
for the  Impairment or Disposal of  Long-Lived  Assets",  the Company  regularly
reviews the carrying  value of intangible  and other  long-lived  assets for the
existence of facts or  circumstances,  both internally and externally,  that may
suggest impairment. If impairment testing indicates a lack of recoverability, an
impairment  loss is  recognized  by the  Company  if the  carrying  amount  of a
long-lived asset exceeds its fair value.


                                      F-10

                                                                              32
<PAGE>

                      ALPHA SPACECOM, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                   NOTES CONSOLIDATED TO FINANCIAL STATEMENTS

NOTE 1. ORGANIZATION,  OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued):

Foreign Currency
----------------

The Company currently conducts limited operations,  and has chosen the US dollar
as its  designated  operating  currency.  If the  Company's  foreign  operations
increase,  it will in all  likelihood  designate the currency of each country in
which it operates as the functional  operating  currency for that area, at which
time foreign  assets and  liabilities  will  generally be  translated  into U.S.
dollars at current  exchange  rates,  and revenues and  expenses  translated  at
average exchange rates during the year. Resulting  translation  adjustments will
be reflected as a separate component of stockholders'  equity.  Foreign currency
transaction gains and losses will be included in consolidated operations.

Recent Accounting Pronouncements
--------------------------------

In November 2004, the FASB issued SFAS No. 151,  "Inventory  Costs (An Amendment
of ARB No. 43, Chapter 4)". SFAS 151 amends and clarifies  financial  accounting
and reporting for abnormal amounts of idle facility expense,  freight,  handling
costs, and wasted material (spoilage). The Company has adopted the provisions of
SFAS No. 151 which are effective in general for inventory  costs incurred during
fiscal years beginning after June 15, 2005. The adoption did not have a material
effect on the results of operations of the Company.

In December  2004,  the FASB issued  SFAS No. 152,  "Accounting  for Real Estate
Time-Sharing Transactions (An Amendment of FASB Statements No. 66 and 67)". SFAS
152 amends FASB 66 and 67 to reference the accounting and reporting guidance for
real  estate  time-sharing  transactions  provided  for in  AICPA  Statement  of
Position  04-2. of The Company has adopted the  provisions of SFAS No. 152 which
are effective for financial statements for fiscal years beginning after June 15,
2005.  The adoption did not have a material  effect on the results of operations
of the Company.

In December 2004, the FASB issued SFAS No. 153,  "Exchange of Nonmonetary Assets
(An Amendment of APB No. 29)".  SFAS 153 amends Opinion 29 to eliminate the fair
value  accounting  exception  for  nonmonetary  exchanges of similar  productive
assets,  and replaces that  exception with a general  exception for  nonmonetary
assets  that do not have  commercial  substance.  The  Company  has  adopted the
provisions of SFAS No. 153 which are effective in general for nonmonetary  asset
exchanges  occurring in fiscal years beginning after June 15, 2005. The adoption
did not have a material effect on the results of operations of the Company.


                                      F-11

                                                                              33

<PAGE>

                      ALPHA SPACECOM, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                   NOTES CONSOLIDATED TO FINANCIAL STATEMENTS

NOTE 1. ORGANIZATION,  OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued):

NOTE 2. GOING CONCERN

The Company  has  suffered  recurring  losses  from  operations  and has a large
working capital  deficit.  These conditions  raise  substantial  doubt about the
Company's  ability  to  continue  as a going  concern.  The  Company  may  raise
additional capital through the sale of its equity securities,  through offerings
of debt  securities,  or through  borrowings  from  financial  institutions.  In
addition,  the Company  hopes to generate  revenues  from the  establishment  of
satellite communications networks in East Asia. Management believes that actions
presently being taken to obtain  additional  funding provide the opportunity for
the Company to continue as a going concern.

NOTE 3. RELATED PARTY TRANSACTIONS

The Company has  financed  its general  and  administrative  expenses  primarily
through  advances  from  officers  and  shareholders.  At December  31, 2003 the
Company had $1,345,808 in Directors and shareholder  advances  outstanding which
were unsecured,  non-interest bearing and due on demand.  Additional shareholder
advances of $176,729 were unsecured and bore interest at 9.5% per annum.

During 2004, the Company was advanced  approximately  $42,000 by related parties
for general and  administrative  expenses.  At December 31, 2004 the Company had
$1,388,010  in  Directors  and  shareholder   advances  outstanding  which  were
unsecured, non-interest bearing and due on demand.

In April 2005, the Company moved its principal  place of business to the offices
of its current President and Chief Executive Officer,  located at Room 710, Zhou
Ji Building, No. 16 Ande Road, Dongcheng District,  Beijing,  100011 China. This
space consists of 1,660 square feet of executive office space and is provided to
the Company by the Officer on a rent-free basis.

NOTE 4. INCOME TAX

Deferred  income taxes arise from the temporary  differences  between  financial
statement  and  income  tax  recognition  of net  operating  losses.  These loss
carryovers  are limited  under the Internal  Revenue  Code should a  significant
change in ownership occur.

During the year ended  December 31, 2004 the Company  incurred a loss of $70,418
resulting in a deferred  tax benefit of  approximately  $27,000,  which has been
offset by a 100% valuation allowance. Due to management changes,  deferred taxes
prior to 2004 are  unknown to  management  at the  present  time,  although  the
Company has no tax  liability  in the United  States.  The Company is subject to
income taxes when operating in other  countries at tax rates  effective in those
countries.  The Company has provided for no income taxes  foreign or domestic as
it has incurred losses since the date of inception.

                                      F-12

                                                                              34
<PAGE>

                      ALPHA SPACECOM, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                   NOTES CONSOLIDATED TO FINANCIAL STATEMENTS

NOTE 5.  STOCKHOLDERS' EQUITY

Common stock
------------

The  Company  as of  December  31,  2004 and 2003 had  2,000,000,000  shares  of
authorized  common stock,  $.0001 par value in 2004 and $.001 par value in 2003,
with 136,038,452 and 119,286,000 shares issued and outstanding.  During 2004 the
Company  issued  11,585,785  common  shares to retire an accrued  advance from a
shareholder  in the amount of  $231,716,  including  principal  of $176,729  and
interest of $54,987.  The Company issued  1,666,667  shares for $50,000 in cash,
however as  receipt  of the cash by the  Company  has not yet been  verified  by
current  management,  the  Company has  recorded a common  stock  receivable  of
$50,000 pending final  verification  of receipt in that amount.  Also in 2004, a
shareholder  converted  38,889 Series B preferred  shares to 3,500,000 shares of
common stock at a conversion ratio of 90 for 1.

Preferred stock
---------------

The Company as of December 31, 2004 & 2003 had  20,000,000  shares of authorized
preferred stock, out of which 23,000 shares remain designated as Series A, $.001
par  value,  7%  cumulative   convertible  preferred  stock  ("Series  A"),  and
10,000,000 shares are designated as Series B, $.0001 par value in 2004 and $.001
par value in 2003, convertible preferred stock ("Series B").

Series A:

At December 31, 2004 & 2003 the Company had 23,000 Series A shares  outstanding.
Each Series A share has a par value of $.001,  is convertible  into 40 shares of
the Company's common stock with no further  consideration,  and yields dividends
at 7.0% per annum. Due to misplaced records from management changes, the Company
currently can not verify the preferential  rights,  if any, of the Series A with
regard to dividends or  liquidation  to either  common stock or to the Series B.
Also due to lost  records,  although  the amount  cannot  currently  be verified
absolutely,  the Company may have as much as $238,013 in cumulative dividends in
arrears.  These  dividends  have not been  declared  by the Board of  Directors.
Voting rights of the Series A, if any, cannot currently be verified.

Series B:

At December 31, 2004 & 2003 the Company had  9,587,111  and  9,626,000  Series B
shares  outstanding.  Each  Series B share has a par  value of $.0001  ($.001 in
2003) and is  convertible  into 90 shares of the Company's  common stock with no
further consideration.  The Series B has preferential  liquidation rights but no
preferential  dividend  rights to common  stock.  Due to misplaced  records from
management changes, the Company currently cannot verify the preferential rights,
if any, of the Series B with regard to dividends or liquidation to the Series A.
The Series B carries voting rights at 90 votes for each share of Series B owned.

                                      F-13

                                                                              35
<PAGE>

                      ALPHA SPACECOM, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                   NOTES CONSOLIDATED TO FINANCIAL STATEMENTS

NOTE 6.  LEGAL PROCEEDINGS

In November,  2004,  a lawsuit was filed in the District  Court for the City and
County of Denver,  Colorado by certain former Officers and Directors claiming to
represent  the Company  and by Tridon  Trust (an entity  controlled  by a former
Director) as  Plaintiffs  (collectively  referred to as "Former  Directors"  and
"Tridon") The suit sought to have the Court confirm the alleged  resignation  of
Mr. Xuedong Hu, Chief Executive Officer and current Director, and Mr. Jian Wang,
current  Director,  each  of who  asserted  that  they  had not  resigned  their
respective  positions  with the  Company.  The action also sought to rescind the
2001 Share Exchange  Agreement with Alpha Sky Investment  Limited  ("Alpha Sky")
through which Mr. Hu received his beneficial  ownership interest in the Company.
In  January,  2005,  a motion to  dismiss  was filed on behalf of Mr. Hu and Mr.
Wang, which denied the allegations contained in the compliant.

A hearing was held on various motions filed in this matter on March 18, 2005. On
March 30, 2005, a Colorado  District Court Judge signed an Order ruling that Mr.
Hu retained his beneficial  ownership in the Company's common stock and that the
attempt  by the  Former  Directors  to  remove  Mr. Hu and Mr.  Wang from  their
positions as  Directors  did not comply with  Colorado  law. The Judge also held
that a Board  meeting held on October 1, 2004 and continued to October 15, 2004,
lacked a quorum and could not  effectively  terminate  Mr. Hu's  position as the
Company's  CEO.  Finally,  the Court ruled as valid a demand  tendered by Mr. Hu
that the Company hold a special shareholders meeting to consider the election of
Directors and other matters pursuant to the laws of the State of Colorado.  This
meeting was held June 13, 2005.

On March 25, 2005,  Tridon  filed a voluntary  notice of dismissal of its claims
with the Colorado Court. Subsequent to the Court's March 30, 2005 written Order,
Tridon  filed a motion  asking the Court to vacate its Order and declare that it
lacked  jurisdiction  as a result of the notice of  dismissal.  In the  filings,
Tridon  claimed  that the  voluntary  notice of  dismissal  removes  the Court's
authority  to sign the  written  order,  and that the oral  ruling was not valid
until  reduced to writing  and  signed.  Mr. Hu, Mr.  Wang,  and Alpha Sky filed
responses to the Tridon  filings,  arguing  that the Order  entered by the Court
remains valid. On May 11, 2005, the Court issued a second Order stating that its
original order was entered March 18, 2005,  prior to the dismissal,  and that it
retained jurisdiction to sign and enforce its written Order.

Tridon  filed a notice of appeal  with the  Colorado  Court of Appeals  June 15,
2005;  Case No. 05 CA 1244.  Tridon also filed a Petition for Rule To Show Cause
with the Colorado Supreme Court on June 15, 2005; Case No. 05SA180.  On June 22,
2005, the Colorado Supreme Court denied the Petition.  The Court of Appeals case
remains pending, and is in its early stages.


                                      F-14

                                                                              36
<PAGE>

                      ALPHA SPACECOM, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                   NOTES CONSOLIDATED TO FINANCIAL STATEMENTS

NOTE 6.  LEGAL PROCEEDINGS (Continued):

While that appeal is pending,  the Colorado District Court's Orders of March 18,
2005  and May 11,  2005 are in  effect.  Those  Orders  provide  that the  Board
meetings removing Mr. Hu and Mr. Wang were not valid, and as a result Mr. Hu was
not properly or lawfully  removed as the Company's CEO or a member of the Board.
Similarly,  Mr.  Wang was not  properly or  lawfully  removed  from the Board of
Directors. In reliance upon this Court Order, Messrs. Hu and Wang have continued
to serve as Officers and Directors.

On May 3, 2005, Tridon Trust as plaintiff,  filed a suit in the Federal District
Court  located  in  Los  Angeles,  California,  naming  Xuedong  Hu,  Alpha  Sky
Investment  Limited,  and Alpha Spacecom  Company Limited as defendants.  Tridon
Trust is a shareholder of the Company,  and Alpha Spacecom  Company Limited is a
subsidiary of the Company as a result of the prior Share  Exchange  Agreement of
December  10,  2001.  The suit  seeks  damages  based  upon  alleged  fraud  and
misrepresentations  leading up to the Share Exchange Agreement closing. The suit
also seeks to rescind the Share Exchange Agreement.

On the date  filed,  Tridon  Trust  also  asked  the  Court  to enter  temporary
injunctive   relief   requiring   that  Xuedong  Hu  provide   certain   alleged
representatives of Alpha Spacecom,  Inc. with the current SEC codes necessary to
file documents through the Edgar system. The Judge denied Tridon Trust's request
on May 3, 2005.

Mr. Hu and Alpha Sky  Investment  Limited  filed a motion to dismiss  all of the
claims  in  this  case.  Prior  to  the  date  set  for  hearing,  the  attorney
representing  Tridon Trust filed a First Amended Complaint,  changing the claims
and the parties. Alpha Sky Investment Limited and Alpha Spacecom Company Limited
are no longer  defendants,  Alpha Spacecom,  Inc. has been added as a plaintiff,
and the  Securities and Exchange  Commission has been added as a defendant.  The
Company under the current Board of Directors did not authorize this action.

The First  Amended  Complaint  filed in the case seeks to have the Court declare
that the actions  taken at the June 13, 2005  special  shareholder  meeting were
invalid based upon alleged violations of Federal securities laws relating to the
information required for a valid proxy statement.  The allegations also question
the ownership interest in a large block of Series B Preferred Convertible Stock,
9,777,775 shares in total.

The outcomes of this suit and of the case pending  before the Colorado  Court of
Appeals are undecided at the current  time. A ruling by either Court  rescinding
the results of the June 13, 2005 shareholders'  meeting or recognizing  previous
removal of the current


                                      F-15

                                                                              37
<PAGE>

                      ALPHA SPACECOM, INC. AND SUBSIDIARIES
                          (A Development Stage Company)
                   NOTES CONSOLIDATED TO FINANCIAL STATEMENTS

NOTE 6.  LEGAL PROCEEDINGS (Continued):

Board could restore control of the Company to the Former  Directors.  The Former
Directors  could recognize  obligations,  contracts and expense amounts for 2004
not recognized by the current Board.  Therefore, a Court ordered change in Board
control of the Company could result in substantial  and material  changes to the
2004 financial  statements.  Such possible changes are currently  indeterminable
and inestimable.

NOTE 7.  CONTINGENCIES AND OTHER MATTERS

In July 2003,  the  Company,  through  its  subsidiary  Alpha  Spacecom  Company
Limited,  executed a  cooperation  agreement  with China Film Group  Corporation
("CFG")  calling for large funding  commitments by both parties  ($30,000,000 by
the Company).  The  agreement and  contemplated  business  activities  set forth
therein expired on July 28, 2004, unfunded by either party.

The  Company  plans to conduct  operations  in the  Peoples'  Republic  of China
("PRC"),  and in  doing  so  will  be  subject  to  special  considerations  and
significant  risks not typically  associated with  investments in North American
and Western  European  countries.  The  Company's  operations  may be  adversely
affected by significant political, economic and social uncertainties in the PRC.
Although the PRC government has been pursuing  economic  reform policies for the
past several  years,  no  assurance  can be given that the PRC  government  will
continue to pursue such policies or that such policies may not be  significantly
altered, especially in the event of a change in leadership,  social or political
disruption or unforeseen  circumstances affecting the PRC's political,  economic
and social life. There is also no guarantee that the PRC government's pursuit of
economic reforms will be consistent or effective.

NOTE 8. SUBSEQUENT EVENTS

On June 13, 2005 the Company held a special  shareholders  meeting in Hong Kong.
As a result of the meeting, the Company was reorganized as a Nevada corporation,
with  200,000,000  million  authorized  common  shares,  $.001  par  value,  and
50,000,000  million  authorized  preferred shares,  $.001 par value. The Company
also  affected  a 1 for 10 reverse  stock  split,  with  every 10 common  shares
outstanding (or the convertible equivalent if preferred stock) becoming 1 share.

Matters  referenced to Notes 1 and 8 regarding the China Film Group  Corporation
by the May 17, 2004 Independent Auditors' Report are now addressed in Note 7.



                                      F-16

                                                                              38
<PAGE>

ITEM  8.  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
FINANCIAL DISCLOSURE.

     Effective May 10, 2004, we dismissed Spear,  Safer,  Harmon & Co. ("SSHC"),
as our  independent  accountants.  Effective  May 10, 2004, we engaged De Joya &
Company, as our new independent accountants.

     Effective  May 9, 2005,  we dismissed De Joya & Company as our  independent
accountants.  Effective  May 9,  2005,  we  engaged  Kabani & Company as our new
independent accountants. Because of the controversy regarding the control of our
Company  discussed  in PART I,  Item 1 above,  Kabani & Company  elected  not to
proceed  as our  independent  accountant  and did  not  perform  any  accounting
services on our behalf. On June 13, 2005, our Board of Directors then elected to
retain Ronald R. Chadwick,  P.C.  ("Chadwick") as our independent  accountant to
audit our financial  statement for our fiscal year ending December 31, 2004, and
include  such report as part of our annual  report on Form 10-KSB for our fiscal
year  ending  December  31,  2004.  There were no  consultations  between us and
Chadwick  prior to their  appointment.  The  dismissal  of De Joya & Company was
approved by our Board of Directors.  The audited financial  statements of Ronald
R.  Chadwick,  P.C. for our fiscal year ended  December  31, 2004,  are included
below in this report.

ITEM 8A.  CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures
------------------------------------------------

     Disclosure  controls and procedures are designed to ensure that information
required to be  disclosed in the reports  filed or submitted  under the Exchange
Act of 1934 is recorded,  processed,  summarized  and reported,  within the time
periods  specified  in the  rules  and  forms  of the  Securities  and  Exchange
Commission.  Disclosure  controls and procedures  include,  without  limitation,
controls  and  procedures  designed  to ensure that  information  required to be
disclosed  in the reports  filed under the  Securities  Exchange  Act of 1934 is
accumulated  and  communicated  to  management,  including  our Chief  Executive
Officer,   as  appropriate,   to  allow  timely  decisions   regarding  required
disclosure.

     Within the 90 days prior to the filing date of this report,  we carried out
an evaluation of the effectiveness of the design and operation of our disclosure
controls and procedures  pursuant to Exchange Act Rule 13a-14.  This  evaluation
was done  under the  supervision  and with the  participation  of our  Principal
Executive Officer. Based upon that evaluation,  he concluded that our disclosure
controls and  procedures  are effective in gathering,  analyzing and  disclosing
information needed to satisfy our disclosure obligations under the Exchange Act.

                                                                              39
<PAGE>

Changes in Internal Controls
----------------------------

     There were no  significant  changes in our  internal  controls  or in other
factors that could  significantly  affect those  controls  since the most recent
evaluation of such controls.

                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
WITH SECTION 16(a) OF THE EXCHANGE ACT.

     Our directors and officers as of the date of this Report are as follows:

                  Name            Age                      Position
         ---------------------    ---    -----------------------------------

         Xuedong Hu               41     Chief Executive Officer, President,
                                         Chief Financial Officer and a Director

         Jian Wang                29     Chief Operating Officer, Director

         Rain Zhang               29     Secretary, Director

     Directors are elected for one-year  terms or until the next annual  meeting
of shareholders and until their  successors are duly elected and qualified.  Our
officers are  appointed  by our Board of Directors  and serve at the pleasure of
the Board, subject to any rights under employment agreements.

     There are no family  relationships among the officers and directors.  There
is no  arrangement  or  understanding  between  us (or any of our  directors  or
officers)  and any other  person  pursuant  to which such person was or is to be
selected as a director or officer.

Resumes. Following are the biographies of our current management.

     Xuedong Hu. Since  December 2001, Mr. Hu has been the Chairman of the Board
and Chief Executive Officer of our Company. He was appointed our Chief Financial
Officer  in April  2005.  He began his  professional  career  in the  technology
business in China in the  mid-1990's.  In 1997, he explored the feasibility of a
Ka regional system for Asia Pacific. He devotes substantially all of his time to
the business of our Company.

     Jian Wang. Mr. Wang assumed his position as Chief  Operating  Officer and a
Director with us in June 2003 and was previously responsible for the development
of the Digital  Cinema and  Satellite-Pay-Per-View  projects in China,  until we
abandoned these projects.  From June

                                                                              40
<PAGE>

2002 through  February  2003,  he was a system  engineer  with us. From May 2000
through May 2002,  he was a technical  leader for Digital Media Gateway Corp. He
received  a Bsc  degree in 1998 from  Communication  University  of China with a
degree in electronic  engineering.  He devotes  substantially all of his time to
the business of our Company.

     Rain Zhang.  Since  March 2003,  Ms.  Zhang has been  self-employed,  doing
business as Pinnacle  International  LLC, a New York limited  liability  company
engaged in providing  financial  consulting services to small public and private
companies  internationally.  Prior,  from March 2002 through  February 2003, Ms.
Zhang was employed by Benchmark  Capital Group, New York, NY, as a as a research
analyst.  From September 2001 through  February  2002, she was  unemployed.  Ms.
Zhang  received a Masters of Business  Administration  degree from Case  Western
University  in 2001 and a Bachelor  degree in economics  from the  University of
International  Business  and  Economics  in Bejing,  China in 1998.  She devotes
substantially all of her time to the business of our Company.

MEETINGS OF THE BOARD OF DIRECTORS
AND COMMITTEES OF THE BOARD OF DIRECTORS

     Our operations are managed under the supervision of our Board of Directors,
which has the ultimate  responsibility  for the establishment and implementation
of our general operating philosophy, objectives, goals and policies.

     During fiscal 2004, our Board of Directors held no valid meetings.

     During fiscal 2004,  the Board of Directors had no  committees.  Management
intends to establish both an Audit Committee and Compensation  Committee once we
begin to generate revenues in the future.

ITEM 9B.  COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

     Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers,  directors  and person who own more than 10% of the  Company's  Common
Stock to file reports of ownership and changes in ownership  with the Securities
and  Exchange  Commission.  All of the  aforesaid  persons  are  required by SEC
regulation  to furnish the Company  with copies of all Section  16(a) forms they
file.  During our fiscal year ended December 31, 2004,  there were no changes in
the  holdings  of  any  of  our  officers  and   directors,   or  our  principal
shareholders. Therefore, no reports were required to be filed.

                                                                              41
<PAGE>

ITEM 10.  EXECUTIVE COMPENSATION.

Remuneration

     The following table reflects all forms of  compensation  for services to us
for the years ended December 31, 2004 and 2003, of our Chief Executive  Officer,
as  well as  those  persons  who  received  in  excess  of  $100,000  in  annual
compensation from us during the aforesaid time.

<TABLE>
                           SUMMARY COMPENSATION TABLE

<CAPTION>
                                                  Long Term  Compensation
                                            ----------------------------------
                     Annual Compensation            Awards             Payouts
                    ----------------------  -------------------------  -------
                                    Annual  Restricted   Securities             All Other
  Name and                          Compen-    Stock     Underlying      LTIP    Compen-
 Principal          Salary  Bonus   sation    Awards    Options/SAR's  Payouts   sation
  Position    Year    ($)    ($)      ($)       ($)          (#)         ($)       ($)
-----------   ----  ------  ------  ------  ----------  -------------  -------  ---------
<S>           <C>   <C>     <C>     <C>     <C>               <C>      <C>      <C>
Xuedong Hu,   2003  $    0  $    0  $    0  $        0        0        $     0  $       0
Chairman,
President     2004  $    0  $    0  $    0  $        0        0        $     0  $       0
</TABLE>

     We have adopted a policy  whereby we reimburse  officers and  directors for
out of pocket  expenses  incurred  by each of them in the  performance  of their
relevant duties.  However,  we did not reimburse any officer or director for any
such expenses during the fiscal year ended December 31, 2004.

     We have no stock plan for employees, but may adopt one in the future.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     The table below lists the beneficial  ownership of our voting securities by
each  person  known by us to be the  beneficial  owner  of more  than 5% of such
securities,  as well as by all our  directors  and officers as a group as of the
date of this Report.  The numbers  indicated in the table reflect  conversion of
our  outstanding  Series B Preferred  Stock,  each share of which is convertible
into 9 shares of our  Common  Stock.  In July 2005,  we adopted a reverse  stock
split. The figures listed below are also presented on a post-reverse stock split
basis. Unless otherwise  indicated,  the shareholders listed possess sole voting
and investment power with respect to the shares shown.

                                                                              42
<PAGE>

     Name and Address             Amount and Nature of
   of Beneficial Owner          Beneficial Ownership(1)(2)      Percent of Class
   -------------------          --------------------------      ----------------

Hu Xue Dong                          82,120,000 Shares                87.3%
Room 710, Zhou Ji Building
No. 16 Ande Road
Dongcheng District, Beijing,
100011 China

All Officers and Directors           82,120,000 Shares                87.3%
as a Group (3 Persons)

(1)  Common Stock subject to options or warrants that are currently  exercisable
     or  exercisable  within 60 days of the date of this Report are deemed to be
     outstanding  and to be  beneficially  owned by the holder  thereof  for the
     purpose of computing  the  percentage  ownership of such person but are not
     treated  as  outstanding  for  the  purpose  of  computing  the  percentage
     ownership of any other person. As of the date of this Report, there were no
     options or warrants issued or outstanding.

(2)  Mr. Hu owns 9,124,445 shares of Series B Convertible Preferred Stock, which
     are convertible into 82,120,000 shares of Common Stock of our Company. Upon
     conversion,  the  82,120,000  will be owned  indirectly  through  Mr.  Hu's
     controlling  interest in the following  entities:  (i)  51,120,000  through
     Alpha Sky  Investment  Limited,  (ii)  1,000,000  through  Project  Connect
     Limited,  (iii) 2,000,000  through Sino Advantage  Limited,  (iv) 4,000,000
     through  Sparkle  Success  Limited,   (v)  5,000,000  through  Choice  Rich
     Investments  Limited,   (vi)  9,000,000  through  Glory  Asset  Investments
     Limited, and (vii) 10,000,000 through Success Day Investments Limited.

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     We have financed our general and administrative  expenses primarily through
advances from officers and shareholders. At December 31, 2003, we had $1,345,808
in  Director  and  shareholder   advances   outstanding   that  were  unsecured,
non-interest  bearing  and due on demand.  Additional  shareholder  advances  of
$176,729 were unsecured and bore interest at 9.5% per annum.

     During 2004, we were advanced  approximately $42,000 by related parties for
general and administrative  expenses. At December 31, 2004, we had $1,388,010 in
Director and shareholder advances outstanding that were unsecured,  non-interest
bearing and due on demand.

     In April 2005, we moved our  principal  place of business to the offices of
our current President and Chief Executive Officer,  located at Room 710, Zhou Ji
Building,  No. 16 Ande Road,  Dongcheng  District,  Beijing,  100011 China. This
space consists of 1,660 square feet of executive  office space.  Mr. Hu provides
this space to us on a rent free basis.

                                                                              43
<PAGE>

     Except as stated  above or as stated  elsewhere,  no member of  management,
executive  officer or security holder had any direct or indirect interest in any
other transaction with us.

                                     PART IV

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K.

a) Exhibits
   --------

Exhibit
Number      Description
------      -----------

2.1         Share Exchange Agreement dated as of December 10, 2001. Incorporated
            herein by reference from our filing on Form 8-K filed on December
            21, 2001.

2.2         Agreement and Plan of Merger between the Company and Alpha Spacecom,
            Inc., a Nevada  corporation,  dated as of June 16, 2005.*

3.1         Articles of Incorporation as filed with the Nevada Secretary of
            State.*

3.2         Bylaws.*

3.3         Articles of Merger as filed with the Nevada Secretary of State.*

21.1        Subsidiaries of the Company.

31.1        Certification of Chief Executive Officer and Chief Financial Officer
            Pursuant  to Section  302 of the  Sarbanes-Oxley Act of 2002.*

32.1        Certification of Chief Executive Officer and Chief Financial Officer
            Pursuant  to Section  906 of the Sarbanes-Oxley Act of 2002.*

99.1        Code of Conduct and Ethics
-------------------
* filed herewith

                                                                              44
<PAGE>

(b) Reports on Form 8-K.
    --------------------

     On or about  October 20, 2004,  a report on Form 8-K was filed  without our
authority,  advising of the  resignation of Messrs.  Hu and Wang as officers and
directors of our Company and the appointment of various individuals as executive
officers.  Pursuant to the Order  entered by the Colorado  District  Court,  the
involuntary resignation of Messrs. Hu and Wang were not undertaken in conformity
with the laws of the State of  Colorado.  Additionally,  the  relevant  meetings
appointing  those persons to those offices  described in the relevant report was
unauthorized and was held without a quorum. Shareholders and potential investors
should  disregard  the  appointment  of these  individuals  as  officers  of our
Company. See "PART I, Item 3, Legal Proceedings."

Subsequent Events

         In May 2005, we filed a report on Form 8-K, advising of the termination
of DeJoya & Company as our independent accountants and the appointment of Kabani
& Company, Inc. as our independent accountants. Thereafter, in June 2005, we
filed an amendment to this report, advising that Kabani & Company, Inc. elected
not to proceed as our independent accountant due to the control issue described
above herein and the appointment of Ronald R. Chadwick, P.C. as our independent
accountant. See "PART II, Item 8," above.

     In April 2005, we filed a report on Form 8-K, advising of the ruling by the
Colorado  District Court  relevant to the litigation  described in "PART I, Item
3," above.

     In addition, in February 2005, January 2005 and in October 2004, reports on
Form 8-K were filed on our behalf  without  authority by those  individuals  who
were  attempting  to  gain  control  of our  Company,  advising  of  changes  in
management.  The reports which were filed without authority  contained erroneous
information  and should not be relied upon,  except for the  resignation  of Mr.
Brian  Brick  as an  officer  and  director  of our  Company,  who,  based  upon
information  and  belief,  did  resign his  positions.  However,  those  persons
included in the aforesaid  reports as accepting  management  positions  with our
Company were not appointed by our Board of Directors or in  accordance  with the
laws of the State of Colorado. See "PART I, Item 3, Legal Proceedings."

     On or about  February 8, 2005,  a report on Form 8-K was filed  without our
authority,  advising of the  appointment  of various  individuals  as  executive
officers.  Pursuant to the Order  entered by the Colorado  District  Court,  the
relevant  meetings  appointing  these persons to those offices  described in the
relevant report was unauthorized and was held without a quorum. Shareholders and
potential  investors  should  disregard the appointment of these  individuals as
officers of our Company. However, our Board of Directors did subsequently accept
the resignation of Mr. Brick. See "PART I, Item 3, Legal Proceedings."

     On or about  January 25, 2005,  a report on Form 8-K was filed  without our
authority,  advising of the  appointment  of various  individuals  as  executive
officers.  Pursuant to the Order

                                                                              45
<PAGE>

entered by the Colorado District Court, the relevant  meetings  appointing these
persons to those offices  described in the relevant report was  unauthorized and
was held without a quorum. Shareholders and potential investors should disregard
the  appointment of these  individuals as officers of our Company.  See "PART I,
Item 3, Legal Proceedings."

ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES.

     Our Board of Directors reviews and approves audit and permissible non-audit
services performed by our independent  accountants,  as well as the fees charged
for such services.  In our review of non-audit  service fees and our appointment
of De Joya &  Company  and  subsequently,  Kabani & Company  as our  independent
accountants,  our Board of Directors  considered  whether the  provision of such
services  is  compatible  with  maintaining  independence.  All of the  services
provided and fees charged by Kabani & Company in fiscal years ended December 31,
2004, were approved by our Board of Directors.

Audit Fees
----------

     The  aggregate  fees billed by Ronald R.  Chadwick,  P.C. for  professional
services for the audit of our annual financial statements for 2004 was $32,000.

     The aggregate fees billed by Kabani & Company for professional services for
the audit of our annual  financial  statements  and the reviews of the financial
statements included in our quarterly reports on Form 10-QSB for 2004 was $0.

     The aggregate  fees billed by De Joya & Company for  professional  services
for  the  audit  of our  annual  financial  statements  and the  reviews  of the
financial  statements  included in our quarterly reports on Form 10-QSB for 2004
was $35,000, net of expenses.

     Because of the issue of control of our Company,  our current management has
been unable to ascertain  the  aggregate  fees billed and paid by Spear,  Safer,
Harmon & Co., our independent auditors until May 2004, for professional services
relating to the audit of our annual financial  statements and the reviews of our
financial  statements  included in our quarterly reports on Form 10-QSB for 2003
and 2004.

Audit-Related Fees
------------------

     There  were no other  fees  billed  by our  current  or  prior  independent
auditors  during the last two fiscal years for  assurance  and related  services
that were  reasonably  related to the  performance of the audit or review of our
financial statements and not reported under "Audit Fees" above.

                                                                              46
<PAGE>

Tax Fees
--------

     The  aggregate  fees  billed by Ronald R.  Chadwick,  P.C.  during the last
fiscal year for  professional  services  rendered for tax  compliance for fiscal
year ended December 31, 2004 was $0.

     The aggregate  fees billed by Kabani & Company  during the last fiscal year
for  professional  services  rendered for tax  compliance  for fiscal year ended
December 31, 2004 was $0.

     The aggregate  fees billed by De Joya & Company during the last fiscal year
for  professional  services  rendered for tax  compliance  for fiscal year ended
December 31, 2004 was $0.

     We have been unable to ascertain the aggregate fees billed by Spear, Safer,
Harmon & Co. during the last two fiscal years for professional services rendered
for tax compliance for our fiscal years ended December 31, 2004 and 2003 for the
reasons stated above.

All Other Fees
--------------

     Upon  information and belief,  there were no other fees billed by Ronald R.
Chadwick,  P.C., Kabani & Company,  De Joya & Company, or Spear, Safer, Harmon &
Co. during the last two fiscal years for products and services provided.

                                                                              47
<PAGE>


                                   SIGNATURES

     In accordance  with Section 13 or 15(d) of the  Securities  Exchange Act of
1934,  the  Company  caused  this  Report  to be  signed  on its  behalf  by the
undersigned, thereunto duly authorized, on July 26, 2005.

                                        ALPHA SPACECOM, INC.
                                        (Registrant)


                                        By:s/ Xuedong Hu
                                           -------------------------------------
                                           Xuedong Hu, Chief Executive Officer


     In  accordance  with the Exchange Act, this Report has been signed below by
the  following  persons  on  behalf  of the  registrant  and  in the  capacities
indicated on July 26, 2005.


s/Xuedong Hu
--------------------------------------
Xuedong Hu, Director

s/ Jian Wang
--------------------------------------
Jian Wang, Director

s/ Rain Zhang
--------------------------------------
Rain Zhang, Director

                                                                              48