UNITED STATES



SECURITIES AND EXCHANGE COMMISSION





Washington, DC 20549

















FORM 10-QSB

















(Mark One)





[X] QUARTERLY
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE
QUARTERLY PERIOD ENDED September 30, 2002











[_] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT FOR THE
TRANSITION PERIOD FROM ______________ TO ________________











Commission File Number
333-5278-NY











AGATE TECHNOLOGIES, INC.



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













Delaware                                                                                                                                                           
94-3334052





(State or other                                                                                                                                                   (IRS Employer





jurisdiction of incorporation)                                                                                                                         Identification No.)















11300 West Olympic Boulevard, Suite 800,  Los Angeles, California 90064





(Address of principal executive offices)











(310) 312-6680

(Issuer's telephone number)













The Company had 108,400,000 shares of common stock, par value $0.0001 per share
outstanding as of September 30, 2002











Transitional Small Business Disclosure Format (Check one): Yes [_] No [X]













PART 1. FINANCIAL INFORMATION



To the Board of Directors

Agate Technologies, Inc. and Subsidiaries

Los Angeles, California



We have reviewed the accompanying consolidated balance sheet of Agate
Technologies, Inc. and subsidiaries as of September 30, 2002, and the related
consolidated statements of operations and comprehensive loss, shareholders'
equity (deficit), and cash flows for the six-month period (April 1, 2002 through
September 30, 2002) then ended, in accordance with Standards for Accounting and
Review Services issued by the American Institute of Certified Public
Accountants.  All information included in these financial statements is the
representation of the management of Agate Technologies, Inc.



A review consists principally of inquiries of Company personnel and analytical
procedures applied to financial data.  It is substantially less in scope
than an audit in accordance with generally accepted auditing standards, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole.  Accordingly, we do not express such an
opinion.



Based on our review, we are not aware of any material modifications that should
be made to the accompanying financial statements in order for them to be in
conformity with generally accepted accounting principles.



/s/ Kenny H. Lee CPA Group, Inc.

KENNY H. LEE CPA GROUP, INC.

November 13, 2002





AGATE TECHNOLOGIES, INC.

Balance Sheet

September 30, 2002 (Unaudited)



|                                                                                                                            | Sept. 30, 2002              
|--------------------------------------------------------------------------------------------------------------------------- | ----------------------------
|                                                                                                                            |                             
|ASSETS                                                                                                                      |                             
|Current Assets                                                                                                              |                             
|Cash and cash equivalents                                                                                                   | $                     
    -
|Accounts receivable, net of allowance for doubtful accounts of $0                                                           | -                           
|Inventories                                                                                                                 | -                           
|Prepayments and other assets                                                                                                | 40,000                      
|                                                                                                                            |                             
|Total current assets                                                                                                        | 40,000                      
|                                                                                                                            |                             
|Restricted cash                                                                                                             | -                           
|Property and equipment, net                                                                                                 | -                           
|                                                                                                                            |                             
|Total assets                                                                                                                | $         
    40,000       
|                                                                                                                            |                             
|LIABILITIES AND
    SHAREHOLDERS' DEFICIT                                                                                   |                             
|Current liabilities                                                                                                         |                             
|Line of credit                                                                                                              | $                    
    - 
|Notes payable                                                                                                               | 95,000                      
|Current portion of time-share payable                                                                                       | -                           
|Accounts payable                                                                                                            | -                           
|Other accrued expenses                                                                                                      | 185,484                     
|                                                                                                                            |                             
|Total current liabilities                                                                                                   | 280,484                     
|                                                                                                                            |                             
|Time-share payable, net of current portion                                                                                  | -                           
|                                                                                                                            |                             
|Total liabilities                                                                                                           | 280,484                     
|                                                                                                                            |                             
|Commitments and contingencies                                                                                               |                             
|                                                                                                                            |                             
|Shareholders' deficit                                                                                                       |                             
|Convertible Series A preferred stock, $0.0001 par value.
    15,000,000 shares authorized; no shares issued and outstanding | -                           
|Common stock, $0.0001 par value.
    200,000,000 shares authorized; 108,400,000 shares issued and
    outstanding           | 10,840                      
|Additional paid-in capital                                                                                                  | 13,006,613                  
|Stock subscription                                                                                                          | (151,500)                   
|Accumulated other comprehensive loss                                                                                        | -                           
|Accumulated deficit                                                                                                         | (13,106,437)                
|                                                                                                                            |                             
|Total shareholders' deficit                                                                                                 | (240,484)                   
|                                                                                                                            |                             
|Total liabilities and shareholders' equity                                                                                  | $        
    40,000        





The
accompanying notes are an integral part of these financial statements.









AGATE TECHNOLOGIES, INC. AND SUBSIDIARIES

Consolidated Statements of Operations and Comprehensive Loss

Six Months Ended September 30, 2002 and 2002 (Unaudited)





|                                                    | Three months
    Sept. 30,
    2002 | Six months
    Sept. 30,
    2002 | Three months
    Sept. 30,
    2001 | Six months
    Sept. 30,
    2001
|--------------------------------------------------- | ----------------------------------- | --------------------------------- | ----------------------------------- | ---------------------------------
|                                                    |                                     |                                   |                                     |                                  
|Net Sales                                           | $          
    19,272              | $            
    76,779          | $           
    22,853             | $        392,097                 
|                                                    |                                     |                                   |                                     |                                  
|Cost of
    goods sold                              | -                                   | 8,373                             | 20,079                              | 236,430                          
|                                                    |                                     |                                   |                                     |                                  
|Gross
    Profit                                    | 19,272                              | 68,406                            | 2,774                               | 155,667                          
|                                                    |                                     |                                   |                                     |                                  
|Expenses                                            |                                     |                                   |                                     |                                  
|Research and development                            | -                                   | -                                 | 16,452                              | 136,399                          
|Sales and marketing                                 | -                                   | 6,002                             | 138,191                             | 462,595                          
|General and administrative                          | 17,590                              | 314,042                           | 481,582                             | 771,480                          
|                                                    |                                     |                                   |                                     |                                  
|Total expenses                                      | 17,590                              | 320,044                           | 636,225                             | 1,370,474                        
|                                                    |                                     |                                   |                                     |                                  
|Income
    (loss) from operations                   | 1,682                               | (251,638)                         | (633,451)                           | (1,214,807)                      
|                                                    |                                     |                                   |                                     |                                  
|Other
    income (expense)                          |                                     |                                   |                                     |                                  
|Interest income and other income                    | -                                   | 191                               | 217                                 | 3,045                            
|Loss from disposition of subsidiaries               | (12,789,689)                        | (12,789,689)                      | -                                   | -                                
|Interest expense and other expense                  | (13,221)                            | (4,987)                           | (19,221)                            | (45,088)                         
|                                                    |                                     |                                   |                                     |                                  
|Total other income (expense)                        | (12,802,910)                        | (12,794,485)                      | (19,004)                            | (42,043)                         
|                                                    |                                     |                                   |                                     |                                  
|Income
    (loss) before provision for income taxes | (12,801,228)                        | (13,046,123)                      | (652,455)                           | (1,256,850)                      
|                                                    |                                     |                                   |                                     |                                  
|Provision
    for income taxes                      | -                                   | 800                               | -                                   | -                                
|                                                    |                                     |                                   |                                     |                                  
|Net income
    (loss)                               | (12,801,228)                        | (13,046,923)                      | (652,455)                           | (1,256,850)                      
|                                                    |                                     |                                   |                                     |                                  
|Other
    comprehensive income (loss)               |                                     |                                   |                                     |                                  
|Foreign currency translation
    adjustment         | -                                   | (8,000)                           | (8,572)                             | (6,185)                          
|                                                    |                                     |                                   |                                     |                                  
|Comprehensive income (loss)                         | ($12,801,228)                       | ($13,054,923)                     | ($661,027)                          | ($1,263,035)                     
|                                                    |                                     |                                   |                                     |                                  
|Basic and
    diluted loss per common share         | ($0.16)                             | ($0.14)                           | ($0.04)                             | ($0.09)                          
|                                                    |                                     |                                   |                                     |                                  
|Weighted
    average number of common shares        | 80,974,186                          | 91,221,858                        | 14,977,083                          | 14,581,580                       

The
accompanying note are an integral part of these financial statements.



AGATE TECHNOLOGIES, INC. AND SUBSIDIARIES

Consolidated Statement of Shareholders' Equity (Deficit)

Six
Months Ended September 30, 2002 (Unaudited)



|                                                                                             | Convertible
    Series A
    Preferred Stock | Common Stock       | Additional
    Paid-in
    Capital | Stock
    Subscriptions | Accumulated
    Other
    Comprehensive
    Income
    (Loss) | Accumulated
    Deficit | Total
    Stockholders'
    Equity
    (Deficit)
|-------------------------------------------------------------------------------------------- | -------------------------------------------- | ------------------ | ---------------------------------- | ----------------------- | ------------------------------------------------------------- | ----------------------- | ------------------------------------------------
|                                                                                             | Shares                                       | Amount             | Shares                             | Amount                 
|Balance at March 31,
    2002                                                                | 1,825,000                                    | $      
    183    | 21,567,593                         | $    
    2,157         | $    
    10,844,506                                          | $    
    (151,500)     | $      
    (19,736)                            
|                                                                                             |                                              |                    |                                    |                         |                                                               |                         |                                                 
|Stock issued for
    conversion
    of
    debts                                             |                                              |                    | 14,023,844                         | 1,402                   | 138,836                                                       |                         |                                                 
|Stock issued for
    conversion
    of
    preferred stock                                   | (1,825,000)                                  | (183)              | 2,737,500                          | 274                     | (91)                                                          |                         |                                                 
|Stock issued for
    employee
    compensation                                               |                                              |                    | 21,437,890                         | 2,144                   | 641,597                                                       |                         |                                                 
|Stock issued for
    services                                                                |                                              |                    | 2,167,000                          | 217                     | 47,787                                                        |                         |                                                 
|Stock issued for
    disposition
    of
    subsidiaries                                     |                                              |                    | 32,822,853                         | 3,282                   | 653,176                                                       |                         |                                                 
|Stock issued for
    payment of
    bank
    debt                                            |                                              |                    | 7,952,060                          | 795                     | 396,808                                                       |                         |                                                 
|Stock issued for
    payment of
    shareholder loan                                         |                                              |                    | 5,691,260                          | 569                     | 283,994                                                       |                         |                                                 
|Cumulative
    translation
    adjustment                                                    |                                              |                    |                                    |                         |                                                               |                         | (8,000)                                         
|Reversal of
    accumulated
    deficits of all subsidiaries
    combined                    |                                              |                    |                                    |                         |                                                               |                         |                                                 
|Reversal of
    accumulated
    comprehensive gain/loss of
    all
    subsidiaries combined |                                              |                    |                                    |                         |                                                               |                         | 27,736                                          
|Net loss                                                                                     |                                              |                    |                                    |                         |                                                               |                         |                                                 
|                                                                                             |                                              |                    |                                    |                         |                                                               |                         |                                                 
|Balance at September
    30,
    2002                                                        | -                                            | $           
    - | 108,400,000                        | $   
    10,840         | $   
    13,006,613                                           | $   
    (151,500)      | $                 
    -                        

The
accompanying notes are an integral part of these financial statements.



AGATE TECHNOLOGIES, INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

Six
Months Ended September 30, 2002 and 2001



|                                                                                              | 2002                             | 2001                         
|--------------------------------------------------------------------------------------------- | -------------------------------- | -----------------------------
|Cash flow from
    operating activities:                                                      |                                  |                              
|Net loss                                                                                      | $       
    (13,046,923)        | $     
    (1,256,850)       
|                                                                                              |                                  |                              
|Adjustments to reconcile net loss to net cash provided by (used in)
    operating activities: |                                  |                              
|Depreciation and amortization                                                                 | -                                | 15,579                       
|Provision for bad debts                                                                       | -                                | 43,154                       
|Issuance of stock for loan fee                                                                | -                                | 56,000                       
|Issuance of stock for conversion of debts                                                     | 140,238                          | -                            
|Issuance of stock for employee compensation                                                   | 643,741                          | 15,000                       
|Issuance of stock for services and fees                                                       | 48,004                           | 290,885                      
|Issuance of stock for disposition of subsidiaries                                             | 656,458                          | -                            
|Issuance of stock for payment of bank debt                                                    | 397,603                          | -                            
|Issuance of stock for shareholder loan                                                        | 284,563                          | -                            
|Reversal of accumulated deficits of all subsidiaries combined                                 | 13,112,931                       | -                            
|Reversal of accumulated comprehensive gain (loss) of all subsidiaries
    combined            | 27,736                           | -                            
|                                                                                              |                                  |                              
|Increase (decrease) in                                                                        |                                  |                              
|Accounts receivable                                                                           | 8,316                            | 235,975                      
|Inventories                                                                                   | 9,385                            | 110,527                      
|Prepayments and other assets                                                                  | (31,816)                         | 5,164                        
|Other assets                                                                                  | -                                | (450)                        
|Increase (decrease) in                                                                        |                                  |                              
|Accounts Payable                                                                              | (715,464)                        | 206,971                      
|Accrued interest on note payable                                                              | (17,633)                         | 17,062                       
|Other accrued expenses                                                                        | (870,905)                        | 165,242                      
|Total adjustments                                                                             | 13,693,157                       | 1,105,109                    
|Net cash provided by (used in) operating activities                                           | 646,234                          | (95,741)                     
|                                                                                              |                                  |                              
|Cash flow from investing activities:                                                          |                                  |                              
|Restricted cash                                                                               | 6,000                            | 398,850                      
|Retirement of property and equipment                                                          | 21,875                           | -                            
|                                                                                              |                                  |                              
|Net cash provided by (used in) investing activities                                           | 27,875                           | 398,850                      
|                                                                                              |                                  |                              
|Cash flow from financing activities:                                                          |                                  |                              
|Proceeds from notes payable                                                                   | 95,000                           | 75,000                       
|Repayment of line of credit                                                                   | (397,603)                        | -                            
|Repayment of note payable                                                                     | (274,182)                        | (401,882)                    
|Repayment of time-share payable                                                               | (12,579)                         | (512)                        
|Repayment of notes payable - related parties                                                  | (103,009)                        | (5,000)                      
|                                                                                              |                                  |                              
|Net cash provided by (used in) financing activities                                           | (692,373)                        | (332,394)                    
|                                                                                              |                                  |                              
|Cumulative translation adjustment                                                             | (8,000)                          | (6,185)                      
|                                                                                              |                                  |                              
|Net decrease in cash and cash equivalents                                                     | (26,264)                         | (35,470)                     
|                                                                                              |                                  |                              
|Cash and cash equivalents at beginning of period                                              | 26,264                           | 61,899                       
|                                                                                              |                                  |                              
|Cash and cash equivalents at end of period                                                    | $                         
    - | $          
    26,429       
|                                                                                              |                                  |                              
|Supplemental disclosure of cash flow information:                                             |                                  |                              
|Cash paid during the period for:                                                              |                                  |                              
|                                                                                              |                                  |                              
|Interest                                                                                      | $                         
    - | $             
    14,249    
|Income tax                                                                                    | $                         
    - | $                      
    -



The accompanying notes are an integral part of these financial statements.









AGATE TECHNOLOGIES, INC. AND SUBSIDIARIES











NOTES TO CONSOLIDATED FINANCIAL STATEMENTS









(UNAUDITED)

















(1)    Unaudited Financial Statements













The balance sheet as at September 30, 2002 represents the unconsolidated financial statement of the parent company Agate Technologies Inc., Delaware subsequent to the sale and disposition of the company's subsidiaries, Agate Technologies Inc., California, ei Corporation , California and Agate International Cayman Limited.  The Company
entered into an agreement with CSF Partners Inc., a Nevada Corporation on July 23 2002 and such agreement has
included in the Form 8K filed on September 16 2002. The balance sheet as of September 30, 2002, the consolidated
statements of operations and cash flows for the three months and six months ended
September 30, 2002 and September 30, 2001
and the related information contained in these notes have been prepared by management without audit. In the
opinion of management, all accruals (consisting of normal recurring accruals) which are necessary for a fair
presentation of financial position and result of operations for such period have been made.  Results for an interim
period should not be considered as indicative of results for a full year. These financial statements should be read in
conjunction with the financial statements and notes thereto contained in the Company's audited financial statements
as of and for the fiscal periods ended March 31, 2002, included in the Form 10KSB filed by the Company on July
17 2002                .







(2)    General











On June 29, 1999, all former shareholders of Agate Technologies Inc., a California corporation (" Agate
California") were issued shares in ARCA Corp, a New Jersey Corporation. ("ARCA") with no known assets or
liabilities, in exchange for the contribution of their Agate-California shares. Each common shareholder received 1.5
ARCA common shares for each Agate-California share exchanged. Each Series A Preferred shareholder received an
equal number of ARCA Series A Preferred Shares, which had substantially identical rights, preferences, privileges,
and restriction, except each share is convertible into 1.5 ARCA common shares. As a result, shareholder of Agate-California owned in excess of 90% of ARCA's outstanding shares and Agate-California became a wholly owned
subsidiary of ARCA. The transaction between ARCA and Agate-California was considered to be an acquisition of
ARCA by Agate-California (reverse-acquisition).











On June 30 1999, ARCA was merged into its other wholly-owned subsidiary, Agate Technologies, Inc., a Delaware
corporation ("Agate-Delaware"), in order to re-incorporate ARCA in Delaware. Agate-Delaware has Series A
Preferred Stock that is identical in rights, preferences, privileges and restrictions, to the ARCA Series A Preferred
Stock. Each ARCA shareholder received one share of gate-Delaware in exchange for each ARCA share.











(3)    Basis of Consolidation











As of September 30, 2002, the consolidated statement of operations and cash flows reflect the account of the Parent
Company, Agate Technologies Inc., Delaware and its wholly owned subsidiaries. The balance sheet as of September 30
2002, reflects the financial position of Agate Technologies Inc., Delaware only. All inter-company accounts and
transactions have been eliminated in the financial statements.











(4)    Summary of Significant Accounting Policies



















The summary of significant accounting policies is included in the notes to the consolidated financial   statements for
the years ended March 31, 2002 and which were audited and appear in the Form 10KSB concurrently filed by the
Company. The Company's certified public accountants have issued a “going concern” qualification in their audit
opinion for the fiscal year ended March 31 2002, that expressed substantial doubt about the Company's ability to
continue as a going concern.  Their doubt is based upon continuing operating losses, a substantial deficit in working
capital, the Company's low cash position and inability to pay its creditors and loans from the bank and its
shareholders.  Further the Company, in view of its inability to raise any cash has ceased its business operations.  The
Company is in default on its loans from the bank and certain related parties and shareholders, as a result of its lack of
financial resources but as of September 30, 2002, has made settlement of these debts in exchange for the shares of the
Company.







ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULT OF
OPERATIONS











Forward Looking Statements











The Company is making this statement in order to satisfy the "safe harbor" provisions contained in the Private
Securities Litigation Reform Act of 1995. This report includes forward-looking statements relating to the business
of the Company. Forward looking statements contained herein or in other statements made by the Company are
made based on management's expectations and beliefs concerning future events impacting the Company and are
subject to uncertainties and factors relating to the Company's operations and business environment, all of which are
difficult to predict and many of which are beyond the control of the Company, that could cause actual results of the
Company to differ materially from those matters expressed in or implied by forward-looking statements. Forward-looking statements are typically indicated by the use of words such as "will", "expects", "intends", and "believes".
The Company believes that the following factors, among others, could affect its future performance and cause actual
results of the Company to differ materially from those expressed in or implied by forward-looking statements made
by or on behalf of the Company: (a) the consummation of the merger transaction with Powerhouse Studios Inc
(b) the Company's ability to raise capital to maintain its public status   (c) uninsurable risks and (d) general
economic conditions. The Company disclaims any duty to update forward-looking statements, even if they become
materially incorrect given subsequent events.











OVERVIEW











Business Overview











The Company is engaged in the design, development and marketing of data storage solutions and data management
across PC platforms. The Company's business focus and product offerings include plug and play software, components for hot-swap solutions, peripheral products for data back-up, products allowing for instant data
recovery and USB digital storage devices and related applications. The Company derives revenues from software
licensing and products sold through retail distribution and direct telephone and Internet sales.





Commencing Feb 2002, the Company ceased its normal business
operations and focused on working with its financial advisors to restructure the
Company's debt and reduce its outstanding debt through the conversion of debt to
shares so that the "public shell" could then be merged with an operating company with assets.  On July 25, 2002,
the Company signed a conditional Letter of Intent with Powerhouse Studios Inc in which the Company will acquire
100% of the issued and outstanding securities of PowerHouse Studios Inc ("Powerhouse") in a reverse takeover.  On
October 14 2002 , the Company  filed with the SEC an information statement outlining the terms and conditions of
proposed transaction with Powerhouse Studios Inc. This acquisition was approved by a majority of the outstanding
shares eligible to vote as at September 17 2002 and there are no changes in the rights of any existing shareholders as
a result of this transaction.











PowerHouse Studios Inc. is in the business of leasing equipment and facilities which serve as a combination of
digital production, post-production and distribution facilities that can create 3-D feature films, visual effects and
other digital content.PowerHouse was organized as a Delaware corporation in May 2002 for this purpose.











During the current quarter, the Company negotiated for the settlement of certain debts and loans and completed the
sale of all of its subsidiaries to CSF Partners Inc.(“CSF”), a Nevada corporation. Pursuant to the agreement with
CSF on July 22 2002 (filed in the 8K dated September 16 2002)  the Company issued a total of 32,822,853 shares
to Agate Technologies Inc., California, ei Corporation California and CSF in exchange for cancellation of debt
owed to the parent by the subsidiaries and the workout of the creditor liabilities by CSF and or its appointed agent.
Agate Cayman will receive a non-exclusive sub-license from Agate Delaware for its intellectual properties including
the Q drive. Pursuant to an approved settlement on July 23, 2002, the Company issued shares of 7,952,060 to
ChinatrustBank USA in addition to  payment of $15,000 and approximately $4,700 for past legal fees . On
September 13 2002, the Board of Directors approved a settlement with a shareholder. 4,891,260 shares have been
issued in settlement of the principal debt of $244,563 while a further $40,000 interest will be converted into 800,000
shares to be held in escrow.











Although, the Company has signed a Letter of Intent with Powerhouse Studios Inc, there is no assurance that the
merger transaction will materialize as such transaction is contingent on the Company meeting certain terms and
conditions and is pending completion of a definitive agreement to be signed.  Even if the merger transaction does
materialize, shareholders of the Company are likely to suffer significant dilution in view of the Company's poor
financial position.











RESULTS OF OPERATIONS











The following discussion is for the three-month and six-month periods ended September 30, 2002. The Company's
certified public accountants have issued a "going concern" qualification in their audit opinion that expresses doubt
about the Company's ability to continue as a going concern. Their doubt is based upon continuing operating losses
and the current deficit in stockholders' equity and working capital and cessation of the Company's operations since Feb
2002.











The Company incurred a net loss of $12,801,228 for the three months ended September 30,2002 as compared to a
net  loss of $652,455 for the same period a year ago. For the current quarter,  $12,789,689 represented loss incurred
from the write down of investments in all subsidiaries , cancellation of debt owed by these subsidiaries and the
issuance of shares to CSF and subsidiaries, Agate California, and ei Corp, California. According to the terms of the
transaction  Agate California and ei Corp California  will transfer substantially all of their assets to the Parent
Company  and CSF will assume ownership of the subsidiaries and its liabilities for a total of 32,822,853 shares. CSF Partners Inc., Nevada, or its appointed agent will attempt to settle the claims alleged by creditors of the
subsidiaries.











QUARTER ENDED SEPTEMBER 30, 2002 COMPARED TO QUARTER ENDED
SEPTEMBER 30, 2001.











Net sales for the quarter period ended September 30, 2002 was
$19,272, a decrease of 16% from $22.853 for the quarter ended September 30, 2001. The Company ceased operations
in February 2002 and the revenue for the current quarter
represents licensing revenue from an existing customer relationship.  Operating expenses decreased from $636,225
for the quarter ended September 30, 2001 to $17,590.  Interest and other income was $217 for the prior quarter ended
September 30, 2001 and there was no interest income for the current quarter ended September 30, 2002.  Interest expense was $19,221
in the prior quarter ended September 30, 2001 compared to $13,221 in the current quarter ended September 30, 2002.











SIX MONTHS ENDED SEPTEMBER 30, 2002 COMPARED TO SIX MONTHS ENDED SEPTEMBER 30,
2001.











Net sales for the six months ended September 30, 2002 decreased  to $76,779 compared with $392,097 for the six
months ended September 30, 2001. The net operating loss for the six months ended September 30, 2002 increased
to  $13,046,123 compared to a net operating loss of $1,256,850 for the prior six-month period ended September 30,
2001, an increase of $11,789,273. This increase  was due to the loss incurred from the  disposition of all of the
Company's subsidiaries.  Total operating expense for the six-month period ended September 30, 2001 was
$1,370,474 compared with total operating expenses in the six months ended September 30, 2002 of $320,044.























The decrease in operating expenses from the previous six-month period was as a result of the cessation of the
Company's business operations from February 2002  pending completion of the proposed merger transaction.















LIQUIDITY AND CAPITAL RESOURCES











Net cash provided by operating activities for the six month
period ended September 30, 2002 was $646,234. This compares to net cash used in
operating activities of $95,741 for the six month period ended September 30,
2001. Net cash provided by investing activities was $27,875 for the quarter
period ended September 30, 2002 compared to $398,850 for the quarter period
ended September 30, 2001. Net cash used for financing activities for the six
months ended September 30, 2002 was $692,373 compared to $332,394 for the six
month ended September 30, 2001. Working capital (current assets minus current
liabilities) was a deficit $240,484 as at September 30, 2002 and reflects the
Company's utilization of the working capital to fund its continuing losses from
operations. As of September 30, 2002, the Company had no cash and other current
assets were $40,000. Current liabilities as of September 30, 2002 were $280,484.

















PART 2. OTHER INFORMATION











ITEM 1 LEGAL PROCEEDINGS











Not Applicable











ITEM 2. CHANGES IN SECURITIES











(c)







(i)    On July 23 2002, the Board of Directors authorized the issue of 7,952,060
shares of restricted common
stock to ChinatrustUSA for settlement of the outstanding bank debt.



(ii)    On July 23, 2002,  the Company issued 1,000,000
shares of common stock under an S-8 filing to Dieterich
and

Associates for legal services provided to the Company.







(iii)    On July 23, 2002, the Board of Directors authorized the
issuance of a total of 32,822,853 shares of restricted common stock to: 
Agate Technologies, Inc., California for 25,620,775 shares of restricted common
stock; ei Corp California for 877,180 shares of restricted common stock,
and CSF Partners, Inc. for 6,324,898 shares of restricted common stock; all
issuances pursuant to an agreement signed with CSF Partners Inc. for the sale of
the Company's subsidiaries.



(iv)   
On August 20, 2002, the Company issued 21,937,890 shares of restricted common
stock to the Company's officers for deferred compensation owed.



(v)   
On September 13, 2002, the Company issued 5,691,260 shares of restricted common stock to Gordon
Pan in settlement of the shareholder loan. Of this, 800,000 shares of restricted common stock is
held in escrow pursuant to the debt-for-shares agreement.





























ITEMS 3 DEFAULTS ON SENIOR SECURITIES











None.











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











Schedule 14C Information Statement - A shareholder vote was taken, effective
September 17, 2002, for approval of the PowerHouse acquisition, and this vote
was finalized by operation of law on October 24, 2002.











ITEM 5 OTHER INFORMATION











Not Applicable











ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K





Exhibit 99.1 - Certifications in Accordance with Section 906 of the
Sarbanes-Oxley Act of 2002

































































SIGNATURES











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









AGATE TECHNOLOGIES, INC.











Date: November
15, 2002                                                                                         /s/ Francis CS Khoo





By: Francis CS Khoo





Chairman of the Board and CEO





















Exhibit 99.1 - Certifications in Accordance with Section 906 of the
Sarbanes-Oxley Act of 2002











CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED





PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002











In connection
with the Quarterly Report of Agate Technologies, Inc. (the "Company") on Form
10-QSB for the period ending September 30, 2002, as filed with
the Securities and Exchange Commission on the date hereof (the “Report'), I,
Francis khoo, President and Chairman of the Company, certify, pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that, to the best of my knowledge and belief:











(1) The report fully complies with the requirements of Section 13(a) or 15(d)
of the Securities Exchange Act of 1934; and











(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and result of operations of the Company.











/s/ Francis Khoo





President/Chairman





Dated: November
15, 2002