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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-QSB

|  |  |                                                                                    | 
|- |  | ---------------------------------------------------------------------------------- | 
|x |  | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934  | 
|  |  | For the Quarter Ended February 28, 2003                                            | 
|  |  | OR                                                                                 | 
|o |  | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 | 

For the transition period from _____________ to ________________

Commission File Number 0-22969



Market Central, Inc.


(Name of Small Business Issuer in
its charter)


|                                                                        |  |                                                
|----------------------------------------------------------------------- |  | -----------------------------------------------
|Delaware
(State or other jurisdiction of
incorporation or organization) |  | 59-3562953
(I.R.S. Employer
Identification No.)

1650A Gum Branch Road, Jacksonville, NC 28540
(Address of Principal Executive Offices)

910-478-0097
(Issuers Telephone Number)

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

Check whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

|    |   |  |  |    |  | 
|--- | - |  |  | -- |  | 
|Yes | x |  |  | No |  | 

State the number of shares outstanding of each of the issuers classes of
common equity, as of the latest practicable date.

|                              |  |                                 
|----------------------------- |  | --------------------------------
|Class                         |  | Outstanding as of April 11, 2003
|                              |  |                                 
|Common Stock, $.001 par value |  | 10,551,727                      

|                                                           |  |        |  |      
|---------------------------------------------------------- |  | ------ |  | -----
|Transitional Small Business Disclosure Format (check one): |  | Yes  o |  | No  x



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TABLE OF CONTENTS



|                                                            |                                                                                               |  |  |  |  |  |  | 
|----------------------------------------------------------- | --------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I.                                                    
|ITEM 1. FINANCIAL STATEMENTS                               
|                                                            | CONDENSED CONSOLIDATED BALANCE SHEETS                                                        
|                                                            | CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS                                              
|                                                            | CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS                                              
|                                                            | NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS                                         
|                                                            | ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|                                                            | PART II                                                                                      
|ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS          
|ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
|                                                            | ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K                                                     
|                                                            | SIGNATURES                                                                                   
|                                                            | CERTIFICATION                                                                                
|EX-3.1 AMENDMENT TO CERTIFICATE OF INCORPORATION           
|EX-3.2 AMENDMENT TO BYLAWS OF COMPANY                      
|EX-99.1 SECTION 906 CERTIFICATION OF CEO                   
|EX-99.2 SECTION 906 CERTIFICATION OF CFO                   



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TABLE OF CONTENTS

|        |  |                                                                                                              |  |   
|------- |  | ------------------------------------------------------------------------------------------------------------ |  | --
|PART I  |  | CONSOLIDATED FINANCIAL INFORMATION                                                                           |  |   
|        |  |                                                                                                              |  |   
|Item 1. |  | Condensed Consolidated Financial Statements                                                                  |  | 3 
|        |  |                                                                                                              |  |   
|        |  | Condensed Consolidated Balance Sheets  February 28, 2003
and August 31, 2002                                |  | 4 
|        |  |                                                                                                              |  |   
|        |  | Condensed Consolidated Statements of Operations 
three months ended February 28, 2003 and
February 28, 2002 |  | 5 
|        |  |                                                                                                              |  |   
|        |  | Condensed Consolidated Statements of Operations 
six months ended February 28, 2003 and
February 28, 2002   |  | 6 
|        |  |                                                                                                              |  |   
|        |  | Condensed Consolidated Statements of Cash Flows 
six months ended February 28, 2003 and February 28, 2002   |  | 7 
|        |  |                                                                                                              |  |   
|        |  | Notes to Condensed Consolidated Financial Statements                                                         |  | 8 
|        |  |                                                                                                              |  |   
|        |  | Item 2.  Managements Discussion and Analysis of Financial Condition
and              Results of Operations  |  | 13
|        |  |                                                                                                              |  |   
|        |  | Item 3.  Controls and Procedures                                                                             |  |   
|        |  |                                                                                                              |  |   
|        |  | PART II.  OTHER INFORMATION                                                                                  |  |   
|        |  | Item 2.  Changes in Securities and Use of Proceeds                                                           |  | 17
|        |  |                                                                                                              |  |   
|        |  | Item 4.  Submission of Matters to a Vote of Security Holders                                                 |  | 17
|        |  |                                                                                                              |  |   
|        |  | Item 6.  Exhibits and Reports on Form 8-K                                                                    |  | 17
|        |  | SIGNATURES
CERTIFICATIONS                                                                                    |  |   

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PART I.




ITEM 1.  FINANCIAL STATEMENTS

The following unaudited Condensed Consolidated Financial Statements as of
February 28, 2003 and for the three months and six months ended February 28,
2003 and February 28, 2002 have been prepared by Market Central,
Inc., a Delaware corporation (formerly, Paladyne Corp.). The Condensed Consolidated
Financial Statements as of August 31, 2002 are audited.

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MARKET CENTRAL, INC.
(Formerly, Paladyne Corp.)
CONDENSED CONSOLIDATED BALANCE SHEETS

|                                                   |                                                                                                                                            |                             |                                          |                           |             |                   |            |                 |             |            |           | 
|-------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------ | --------------------------- | ---------------------------------------- | ------------------------- | ----------- | ----------------- | ---------- | --------------- | ----------- | ---------- | --------- | 
|                                                   |                                                                                                                                            |                             |                                          |                           |             | FEBRUARY 28, 2003 |            | AUGUST 31, 2002
|                                                   |                                                                                                                                            |                             |                                          |                           |             | (UNAUDITED)       |            | (AUDITED)      
|                                                   |                                                                                                                                            |                             |                                          |                           |             |                   |            |                
|ASSETS                                             |                                                                                                                                            |                             |                                          |                           |             |                   |            |                
|                                                   | Cash and cash equivalents                                                                                                                  |                             | $                                        |                          |             |                   | $          |                |            
|                                                   | Accounts receivable, net of allowance for doubtful accounts of $15,000 and $350,000 at
February 28, 2003 and August 31, 2002, respectively |                             |                                          | 775,365                   |             |                   |            | 279,883         |            
|                                                   | Due from related parties                                                                                                                   |                             |                                          | 569,772                   |             |                   |            | 548,320         |            
|                                                   | Prepaid expenses and other current assets                                                                                                  |                             |                                          | 95,771                    |             |                   |            | 77,718          |            
|                                                   |                                                                                                                                            |                             |                                          |                           |             |                   |            |                 |            
|                                                   |                                                                                                                                            | Total current assets        |                                          |                           | 1,440,908   |                   |            |                 | 905,921     |           
|Furniture and fixtures                             |                                                                                                                                            |                             | 369,028                                  |                           |             |                   | 369,028    |                
|Computers and software                             |                                                                                                                                            |                             | 1,951,384                                |                           |             |                   | 1,943,193  |                
|Leasehold improvements                             |                                                                                                                                            |                             | 1,223,352                                |                           |             |                   | 1,212,812  |                
|Accumulated depreciation                           |                                                                                                                                            |                             | (2,274,315                               | )                         |             |                   | (1,777,258 | )              
|                                                   |                                                                                                                                            |                             |                                          |                           |             |                   |            |                 |            
|                                                   |                                                                                                                                            | Property and equipment, net |                                          |                           | 1,269,449   |                   |            |                 | 1,747,775   |           
|Other assets                                       |                                                                                                                                            |                             |                                         |                           |             |                   | 425        |                
|                                                   |                                                                                                                                            |                             |                                          |                           |             |                   |            |                 |            
|                                                   |                                                                                                                                            | $                           | 2,710,357                                |                           |             | $                 | 2,654,121  |                
|                                                   |                                                                                                                                            |                             |                                          |                           |             |                   |            |                 |            
|LIABILITIES AND DEFICIENCY IN
STOCKHOLDERS EQUITY |                                                                                                                                            |                             |                                          |                           |             |                   |            |                
|Current Liabilities:                               |                                                                                                                                            |                             |                                          |                           |             |                   |            |                
|                                                   | Cash disbursed in excess of available funds                                                                                                |                             | $                                        | 26,456                    |             |                   | $          | 38,856          |            
|                                                   | Accounts payable and accrued expenses                                                                                                      |                             |                                          | 2,301,190                 |             |                   |            | 2,458,591       |            
|                                                   | Notes payable, current portion -                                                                                                           |                             |                                          | 350,000                   |             |                   |            | 5,350,000       |            
|                                                   | Accrued preferred stock dividends                                                                                                          |                             |                                          | 210,800                   |             |                   |            | 190,400         |            
|                                                   | Current portion of capital lease obligations                                                                                               |                             |                                          | 639,494                   |             |                   |            | 749,809         |            
|                                                   |                                                                                                                                            |                             |                                          |                           |             |                   |            |                 |            
|                                                   |                                                                                                                                            |                             |                                          | Total current liabilities |             |                   | 3,652,940  |                 |             |            | 8,787,656 | 
|Notes payable, non-current portion                 |                                                                                                                                            |                             | 190,000                                  |                           |             |                   |            |                
|Capital lease obligations                          |                                                                                                                                            |                             |                                         |                           |             |                   | 166,926    |                
|                                                   |                                                                                                                                            |                             |                                          |                           |             |                   |            |                 |            
|                                                   |                                                                                                                                            |                             |                                          | Total liabilities         |             |                   | 3,842,940  |                 |             |            | 8,954,582 | 
|COMMITMENTS AND CONTINGENCIES                      |                                                                                                                                            |                             |                                          |                           |             |                   |            |                
|DEFICIENCY IN STOCKHOLDERS EQUITY                 |                                                                                                                                            |                             |                                          |                           |             |                   |            |                
|                                                   |                                                                                                                                            | Preferred stock;            |                                          |                           |             |                   |            |                 |             |           
|                                                   |                                                                                                                                            |                             |                                          | Series A                  |             |                   | 137        |                 |             |            | 137       | 
|                                                   |                                                                                                                                            |                             |                                          | Series C                  |             |                   | 1,000      |                 |             |            | 1,000     | 
|                                                   |                                                                                                                                            |                             |                                          | Series D                  |             |                   | 1,000      |                 |             |            |          | 
|                                                   |                                                                                                                                            | Common stock                |                                          |                           | 10,551      |                   |            |                 | 16,709      |           
|                                                   |                                                                                                                                            | Additional paid-in capital  |                                          |                           | 20,080,735  |                   |            |                 | 14,345,977  |           
|                                                   |                                                                                                                                            | Accumulated deficit         |                                          |                           | (21,226,006 | )                 |            |                 | (20,664,284 | )         
|                                                   |                                                                                                                                            |                             |                                          |                           |             |                   |            |                 |            
|                                                   |                                                                                                                                            |                             | Total deficiency in stockholders equity |                           |             | (1,132,583        | )          |                 |             | (6,300,461 | )        
|                                                   |                                                                                                                                            |                             |                                          |                           |             |                   |            |                 |            
|                                                   |                                                                                                                                            | $                           | 2,710,357                                |                           |             | $                 | 2,654,121  |                
|                                                   |                                                                                                                                            |                             |                                          |                           |             |                   |            |                 |            

See accompanying notes to unaudited condensed consolidated financial statements

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MARKET CENTRAL, INC.
(Formerly, Paladyne Corp.)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

|                                                            |                            |         |           |                            |            |             |           |         |           |  
|----------------------------------------------------------- | -------------------------- | ------- | --------- | -------------------------- | ---------- | ----------- | --------- | ------- | --------- | -
|                                                            |                            |         |           | FOR THE THREE MONTHS ENDED
|                                                            |                            |         |           | FEBRUARY 28,              
|                                                            |                            |         |           |                           
|                                                            |                            |         |           | 2003                       |            | 2002       
|                                                            |                            |         |           | (UNAUDITED)                |            | (UNAUDITED)
|                                                            |                            |         |           |                            |            |            
|Total Revenues                                              |                            | $       | 2,359,288 |                            |            | $           | 2,523,723 |        
|Cost of Revenues                                            |                            |         | 1,490,174 |                            |            |             | 1,552,946 |        
|                                                            |                            |         |           |                            |            |             |           |        
|Gross Profit                                                |                            |         | 869,114   |                            |            |             | 970,777   |        
|Selling, general and administrative expenses                |                            |         | 866,257   |                            |            |             | 928,124   |        
|Depreciation and amortization                               |                            |         | 248,603   |                            |            |             | 234,852   |        
|                                                            |                            |         |           |                            |            |             |           |        
|Loss from operations                                        |                            |         | (245,746  | )                          |            |             | (192,199  | )      
|Other expense:                                              |                            |         |           |                            |            |             |           |        
|                                                            | Interest expense           |         |           | 26,362                     |            |             |           | 149,828 |          
|                                                            | Professional fees (Note 5) |         |           | 161,021                    |            |             |           |        |          
|                                                            |                            |         |           |                            |            |             |           |        
|Net loss from operations, before
income taxes               |                            |         | (433,129  | )                          |            |             | (342,027  | )      
|Income tax benefits                                         |                            |         |          |                            |            |             |          |        
|                                                            |                            |         |           |                            |            |             |           |        
|Net loss                                                    |                            |         | (433,129  | )                          |            |             | (342,027  | )      
|Cumulative Convertible Preferred Stock
Dividend Requirement |                            |         | (10,200   | )                          |            |             | (10,200   | )      
|                                                            |                            |         |           |                            |            |             |           |        
|Net loss attributable to common stockholders                |                            | $       | (443,329  | )                          |            | $           | (352,227  | )      
|                                                            |                            |         |           |                            |            |             |           |        
|Weighted average common shares outstanding:                 |                            |         |           |                            |            |             |           |        
|                                                            |                            | Basic   |           |                            | 10,551,727 |             |           |         | 1,670,925 |  
|                                                            |                            | Diluted |           |                            | 10,551,727 |             |           |         | 1,670,925 |  
|Net loss per share:                                         |                            |         |           |                            |            |             |           |        
|                                                            |                            | Basic   |           | $                          | (.04       | )           |           | $       | (.21      | )
|                                                            |                            | Diluted |           | $                          | (.04       | )           |           | $       | (.21      | )

See accompanying notes to unaudited condensed consolidated financial statements

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MARKET CENTRAL, INC.
(Formerly, Paladyne Corp.)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

|                                                            |                            |   |           |         |                          |            |             |         |   |           |  
|----------------------------------------------------------- | -------------------------- | - | --------- | ------- | ------------------------ | ---------- | ----------- | ------- | - | --------- | -
|                                                            |                            |   |           |         | FOR THE SIX MONTHS ENDED
|                                                            |                            |   |           |         | FEBRUARY 28,            
|                                                            |                            |   |           |         |                         
|                                                            |                            |   |           |         | 2003                     |            | 2002       
|                                                            |                            |   |           |         | (UNAUDITED)              |            | (UNAUDITED)
|                                                            |                            |   |           |         |                          |            |            
|Total Revenues                                              |                            | $ | 4,834,338 |         |                          | $          | 4,963,999   |        
|Cost of Revenues                                            |                            |   | 2,917,050 |         |                          |            | 3,087,585   |        
|                                                            |                            |   |           |         |                          |            |             |        
|Gross Profit                                                |                            |   | 1,917,288 |         |                          |            | 1,876,414   |        
|Selling, general and
administrative expenses                |                            |   | 1,643,055 |         |                          |            | 1,961,108   |        
|Depreciation and amortization                               |                            |   | 497,057   |         |                          |            | 487,298     |        
|                                                            |                            |   |           |         |                          |            |             |        
|Loss from operations                                        |                            |   | (222,824  | )       |                          |            | (571,992    | )      
|Other expense:                                              |                            |   |           |         |                          |            |             |        
|                                                            | Interest expense           |   |           | 177,876 |                          |            |             | 322,994 |  
|                                                            | Professional fees (Note 5) |   |           | 161,021 |                          |            |             |         |  
|                                                            |                            |   |           |         |                          |            |             |        
|Loss from before
income taxes                               |                            |   | (561,721  | )       |                          |            | (894,986    | )      
|Income tax benefits                                         |                            |   |          |         |                          |            |            |        
|                                                            |                            |   |           |         |                          |            |             |        
|Net loss                                                    |                            |   | (561,721  | )       |                          |            | (894,986    | )      
|Cumulative Convertible Preferred
Stock Dividend Requirement |                            |   | (20,400   | )       |                          |            | (20,400     | )      
|                                                            |                            |   |           |         |                          |            |             |        
|Net loss attributable to
common stockholders                |                            | $ | (582,121  | )       |                          | $          | (915,386    | )      
|                                                            |                            |   |           |         |                          |            |             |        
|Weighted average common shares outstanding:                 |                            |   |           |         |                          |            |             |        
|                                                            |                            |   | Basic     |         |                          | 10,551,727 |             |         |   | 1,670,935 |  
|                                                            |                            |   | Diluted   |         |                          | 10,551,727 |             |         |   | 1,670,935 |  
|Net loss per share:                                         |                            |   |           |         |                          |            |             |        
|                                                            |                            |   | Basic     |         | $                        | (.05       | )           |         | $ | (.55      | )
|                                                            |                            |   | Diluted   |         | $                        | (.05       | )           |         | $ | (.55      | )

See accompanying notes to unaudited condensed consolidated financial statements

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MARKET CENTRAL, INC.
(Formerly, Paladyne Corp.)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                     |  |                                              |          |                                      |           |             |          |   |         | 
|---------------------------------------------------- |  | -------------------------------------------- | -------- | ------------------------------------ | --------- | ----------- | -------- | - | ------- | 
|                                                     |  |                                              |          | FOR THE
SIX MONTHS ENDEDFEBRUARY 28,
|                                                     |  |                                              |          |                                     
|                                                     |  |                                              |          | 2003                                 |           | 2002       
|                                                     |  |                                              |          | (UNAUDITED)                          |           | (UNAUDITED)
|                                                     |  |                                              |          |                                      |           |            
|Cash flows used in operating activities              |  | $                                            | (736,652 | )                                    |           | $           | (477,172 | )
|Cash flows used in investing activities              |  |                                              | (18,306  | )                                    |           |             | (300,133 | )
|Cash flows provided by financing activities          |  |                                              | 767,358  |                                      |           |             | 795,208  |  
|                                                     |  |                                              |          |                                      |           |             |          |  
|Net increase (decrease) in cash and
cash equivalents |  |                                              | 12,400   |                                      |           |             | (17,903  | )
|Cash and cash equivalents at beginning of period     |  |                                              | (38,856  | )                                    |           |             | 158,225  |  
|                                                     |  |                                              |          |                                      |           |             |          |  
|Cash and cash equivalents at end of period           |  | $                                            | (26,456  | )                                    |           | $           | 176,128  |  
|                                                     |  |                                              |          |                                      |           |             |          |  
|Supplemental Cash Flow Information:                  |  |                                              |          |                                      |           |             |          |  
|                                                     |  | Cash paid for interest                       |          | $                                    | 167,781   |             |          | $ | 322,994 | 
|Non cash investing and financing activities:         |  |                                              |          |                                      |           |             |          |  
|                                                     |  | Accrual of preferred stock dividend          |          |                                      | 20,400    |             |          |   | 20,400  | 
|                                                     |  | Preferred shares issued in exchange for debt |          |                                      | 5,000,000 |             |          |   | 300,000 | 
|                                                     |  | Common shares issued in exchange for debt    |          |                                      | 380,000   |             |          |   |         | 

See accompanying notes to unaudited condensed consolidated financial statements

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MARKET CENTRAL, INC.
(Formerly, Paladyne Corp.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
UNAUDITED

NOTE 1. BASIS OF PRESENTATION

General

The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with accounting principles generally accepted in
the United States of America for interim financial information and with the
instructions to Form 10-QSB. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial
statements.

In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Accordingly, the results from operations for the six-month and three-month
periods ended February 28, 2003 are not necessarily indicative of the results
that may be expected for the year ended August 31, 2003. The unaudited
condensed consolidated financial statements should be read in conjunction with
the consolidated August 31, 2002 financial statements and footnotes thereto
included in the Companys SEC Form 10-KSB.

On February 4, 2003, at a special meeting of the stockholders, the Companys
shareholders approved the following items: 1) a change in the name of the
Company from Paladyne Corp. to Market Central, Inc., 2) a one-for-ten reverse
split of the Companys common stock and 3) sale of an aggregate of 8,880,740
post-split shares of common stock to three buyers.

Business and Basis of Presentation

Market Central, Inc. (formerly Paladyne Corp.) (the Company) operates two
wholly owned subsidiaries, ecommerce support centers, inc.and U.S. Convergion,
Inc. (Convergion), which offer contact center solutions and Customer
Relationship Management (CRM) services. ecommerce support centers, inc.
operates under the name Market Central and provides CRM-enabled contact
center services to other companies on an outsource basis. Convergion offers
other contact center options and CRM services. Combined, the subsidiaries
provide inbound technical support, sales, and customer service; outbound
pre-sales and sales; data mining; campaign management; CRM Integration
(applications integration; call center/contact center systems design, sales and
integration; and life-cycle support); and Business Process Outsourcing (BPO) 
specifically, the management of contact center movement to offshore sources.

The unaudited condensed consolidated financial statements include the accounts
of the Company and its wholly owned subsidiary, ecommerce support centers inc.
The Companys acquisition of Convergion occurred on April 3, 2003, and,
accordingly, the financial statements included herein do not include the
accounts of Convergion. All significant inter-company transactions and
balances have been eliminated.

In February 2003, the Company effected a one-for-ten reverse stock split of its
outstanding shares of common stock. All references in the condensed
consolidated financial statements and notes to financial statements, numbers of
shares and share amounts have been restated to reflect the reverse split.

Reclassification

Certain reclassifications have been made to conform to prior periods data to
the current presentation. These reclassifications had no effect on reported
losses.

New Accounting Pronouncements

In October 2002, the FASB issued Statement No. 147, Acquisitions of Certain
Financial Institutions-an amendment of FASB Statements No. 72 and 144 and FASB
Interpretation No. 9, which removes

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acquisitions of financial institutions from the scope of both Statement 72 and
Interpretation 9 and requires that those transactions be accounted for in
accordance with Statements No. 141, Business Combinations, and No. 142,
Goodwill and Other Intangible Assets. In addition, this Statement amends SFAS
No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, to
include in its scope long-term customer-relationship intangible assets of
financial institutions such as depositor- and borrower-relationship intangible
assets and credit cardholder intangible assets. The requirements relating to
acquisition of financial institutions is effective for acquisitions for which
the date of acquisition is on or after October 1, 2002. The provisions related
to accounting for the impairment or disposal of certain long-term
customer-relationship intangible assets are effective on October 1, 2002. The
adoption of this Statement did not have a material impact to the Companys
financial position or results of operations as the Company has not engaged in
either of these activities.

In December 2002, the FASB issued Statement No. 148, Accounting for
Stock-Based Compensation-Transition and Disclosure, which amends FASB
Statement No. 123, Accounting for Stock-Based Compensation, to provide
alternative methods of transition for a voluntary change to the fair value
based method of accounting for stock-based employee compensation. In addition,
this Statement amends the disclosure requirements of Statement 123 to require
prominent disclosures in both annual and interim financial statements about the
method of accounting for stock-based employee compensation and the effect of
the method used on reported results. The transition guidance and annual
disclosure provisions of Statement 148 are effective for fiscal years ending
after December 15, 2002, with earlier application permitted in certain
circumstances. The interim disclosure provisions are effective for financial
reports containing financial statements for interim periods beginning after
December 15, 2002. The adoption of this statement did not have a material
impact on the Companys financial position or results of operations as the
Company has not elected to change to the fair value based method of accounting
for stock-based employee compensation.

In January 2003, the FASB issued Interpretation No. 46, Consolidation of
Variable Interest Entities. Interpretation 46 changes the criteria by which
one company includes another entity in its consolidated financial statements.
Previously, the criteria were based on control through voting interest.
Interpretation 46 requires a variable interest entity to be consolidated by a
company if that company is subject to a majority of the risk of loss from the
variable interest entitys activities or entitled to receive a majority of the
entitys residual returns or both. A company that consolidates a variable
interest entity is called the primary beneficiary of that entity. The
consolidation requirements of Interpretation 46 apply immediately to variable
interest entities created after January 31, 2003. The consolidation
requirements apply to older entities in the first fiscal year or interim period
beginning after June 15, 2003. Certain of the disclosure requirements apply in
all financial statements issued after January 31, 2003, regardless of when the
variable interest entity was established. The Company does not expect the
adoption to have a material impact to the Companys financial position or
results of operations.

NOTE 2. SERIES A DIVIDEND

The holders of the Companys Series A cumulative convertible preferred stock
are entitled to receive, out of the net profits of the Company, annual
dividends at the rate of $.2975 per share. If the net profits of the Company
are not sufficient to pay the preferred dividend, then any unpaid portion of
the dividend will be included in accrued expenses. The Company had accrued
cumulative preferred stock dividends of $210,800 and $190,400 at February 28,
2003 and August 31, 2002, respectively. The Company is currently in the
process of converting all outstanding shares of Series A Preferred Stock into
common stock in accordance with the terms of conversion agreements between the
Company and each holder of Series A Preferred Stock. Pursuant to the
conversion agreements, once the conversion is complete, the holders will
relinquish all rights to the accumulated dividends.

NOTE 3. CAPITAL STOCK

In February 2003, the Company effected a one-for-ten reverse stock split of its
outstanding shares of common stock. The Companys 75,000,000 authorized shares
of common stock with $.001 par value remained unchanged. All references in
consolidated financial statements and notes to financial statements, numbers of
shares and share amounts have been restated to reflect the reverse split. As
of February 28, 2003, the Company has 10,551,727 shares of common stock
outstanding.

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The Company is authorized to issue 10,000,000 shares of preferred stock with a
par value of $.001. As of February 28, 2003, the Company has outstanding 137,143
shares of Series A preferred stock, 1,000,102 shares of Series C preferred
stock and 1,000,000 shares of Series D preferred stock. The Company has
entered into conversion agreements with each holder of preferred stock and is
in the process of converting each such share into common stock in accordance
with the terms of the preferred stock and/or its conversion agreement. Upon
conversion, the Company will issue an aggregate of 2,089,340 shares of common
stock in exchange for the outstanding shares of preferred stock.

The Series D preferred shares were issued on December 10, 2002 (together with a
warrant for 1,000,000 shares of (post reverse split) common stock) to Gibralter
Publishing, Inc. in exchange for the cancellation of the 10% $5,000,000 notes
payable and any accrued and unpaid interest thereon.
During the three-month period ended February 28, 2003, the Company issued
8,880,739 shares of (post reverse split) common stock with a par value of
$.001 per share in exchange for $750,000 of cash and liabilities
assumed, resulting in a change in the controlling interest of the
Company.

NOTE 4. NOTES PAYABLE

Notes Payable at February 28, 2003 and August 31, 2002 are as follows:

|                                                                                                                                                                                                         |  |                   |          |                 |  |   |            |  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | -------- | --------------- |  | - | ---------- | -
|                                                                                                                                                                                                         |  | February 28, 2003 |          | August 31, 2002
|                                                                                                                                                                                                         |  |                   |          |                
|Note payable in quarterly
installments of
$377,000, including
interest at 10%
per annum, secured by
property and equipment
This note was converted
to Series D Preferred
Stock in December 2002          |  | $                 |          |                 |  | $ | 3,500,000  |  
|Note payable in two
installments of
$750,000, plus interest
at 10% per annum, secured
by property and
equipment. This note was
converted to Series D
Preferred Stock in
December 2002                    |  |                   |          |                 |  |   | 1,500,000  |  
|Note payable to Bank in
monthly installments of
interest only at the
Banks prime lending rate
plus 1%, secured by
accounts receivable. This
note is currently in
default and is currently
in litigation |  |                   | 350,000  |                 |  |   | 350,000    |  
|Unsecured note payable to
an individual and a
company bearing interest
at 7%, repayable on
February 25, 2005                                                                                             |  |                   | 190,000  |                 |  |   |           |  
|                                                                                                                                                                                                         |  |                   |          |                 |  |   |            |  
|                                                                                                                                                                                                         |  |                   | 540,000  |                 |  |   | 5,350,000  |  
|Less: current portion                                                                                                                                                                                    |  |                   | (350,000 | )               |  |   | (5,350,000 | )
|                                                                                                                                                                                                         |  |                   |          |                 |  |   |            |  
|                                                                                                                                                                                                         |  | $                 | 190,000  |                 |  | $ |           |  
|                                                                                                                                                                                                         |  |                   |          |                 |  |   |            |  

NOTE 5. PROFESSIONAL FEES

Professional fees consist of legal fees related to the Companys sale of common
stock in February 2003. This sale of common stock resulted in a change in the
controlling interest of the Company and fees related to this transaction have
been shown as a cost of the period.

NOTE 6. SUBSEQUENT EVENTS

On April 3, 2003, the Company consummated the acquisition of U.S. Convergion,
Inc. (Convergion) pursuant to a Stock Purchase Agreement dated April 3, 2003
entered into by and among the Company and
each of the six shareholders of Convergion. The Company acquired all of the
outstanding capital stock of Convergion in exchange for the issuance of 374,630
restricted shares of the Companys Common Stock
and assumption of certain liabilities. The transaction will be accounted for as
a purchase and the purchase price will be allocated to tangible assets and
identifiable intangible assets, with any excess being allocated to goodwill.

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##### Table of Contents



NOTE 7.  RELATED PARTY TRANSACTIONS

Terrence J. Leifheit, the Companys President and Chief Financial Officer, is a
50% owner of Gibralter Publishing, Inc. (Gibralter). Gibralter is the
Companys largest customer, accounting for approximately 42% and 40% of the
revenues of the Company for the six-month and three-month periods ending
February 28, 2003. In addition, pursuant to the Companys purchase of certain
assets from Gibralter in February 2001, the Company executed two promissory
notes aggregating $5,000,000 for the purchase price. In December 2002, those
promissory notes were converted into 1,000,000 shares of Series D Preferred
Stock (which is in the process of being converted into 1,000,000 shares of the
Companys Common Stock) and a warrant to purchase 1,000,000 additional shares
of the Companys Common Stock.

J&C Nationwide, Inc. a company controlled by William Goldstein, the Companys
largest shareholder and a director, is also a customer of the Company. Revenue
from J&C Nationwide, Inc. during the six and three months ended February 28,
2003 totaled $13,350.

Glen H. Hammer and William Goldstein, the Companys new majority owners, have
provided the Company with an unsecured credit facility in the amount of
$635,000. The Company can draw on such amounts from time to time as needed for
general working capital purposes. Amounts outstanding bear interest at 7.0% and
all amounts outstanding mature on February 25, 2005. At February 28, 2003, the
Company had borrowed $190,000 under this facility.

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##### Table of Contents






ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

Overview

Market Central, Inc. (formerly Paladyne Corp.) (the Company) operates two
wholly owned subsidiaries, ecommerce support centers, inc.and U.S. Convergion,
Inc. (Convergion), which offer contact center solutions and Customer
Relationship Management (CRM) services. ecommerce support centers, inc.
operates under the name Market Central and provides CRM-enabled contact
center services as an outsource service to other companies. Convergion offers
other contact center options and CRM services. Combined, the subsidiaries
provide inbound technical support, sales, and customer service; outbound
pre-sales and sales; data mining; campaign management; CRM Integration
(applications integration; call center/contact center systems design, sales and
integration; and life-cycle support); and Business Process Outsourcing (BPO) 
specifically, the management of contact center movement to offshore sources.

The unaudited condensed consolidated financial statements include the accounts
of the Company and its wholly owned subsidiary, ecommerce support centers inc.
The Companys acquisition of Convergion occurred on April 3, 2003, and,
accordingly, the financial statements included herein do not include the
accounts of Convergion. All significant inter-company transactions and
balances have been eliminated.

The Companys unaudited condensed consolidated financial statements are
presented on a going concern basis, which contemplates the realization of
assets and satisfaction of liabilities in the normal course of business. The
unaudited condensed consolidated financial statements do not include, nor does
management feel it necessary to include, any adjustments to reflect any
possible future effects on the recoverability and classification of assets or
the amounts and classification of liabilities that may result from the possible
inability of the Company to continue as a going concern. The Companys
independent accountants report contained a going concern qualification for the
year ended August 31, 2002.

The Company maintains substantial business relationships with Gibralter
Publishing, Inc. (Gibralter). The Companys president and CEO is a principal
of Gibralter. Gibralter continues to be the Companys principal customer,
accounting for approximately 42% and 40% of the Companys revenues for the
six-month and three-month periods ended February 28, 2003.

In February 2003, the Company effected a one-for-ten reverse stock split of its
outstanding shares of common stock. All references in the condensed
consolidated financial statements and notes to financial statements, numbers of
shares and share amounts have been restated to reflect the reverse split.

RESULTS OF OPERATIONS

The following table sets forth the percentage relationship to the total
revenues of principal items contained in the Companys Unaudited Condensed Consolidated
Statements of Operations for the three and six months ended February 28, 2003
and 2002, respectively. The percentages discussed throughout this analysis are
stated on an approximate basis.

|               |  |                    |     |                  |  |      |     |      |  |  |     |   |  |  |     |  
|-------------- |  | ------------------ | --- | ---------------- |  | ---- | --- | ---- |  |  | --- | - |  |  | --- | -
|               |  | Three months Ended |     | Six months Ended
|               |  | February 28,       |     | February 28,    
|               |  |                    |     |                 
|               |  | 2003               |     | 2002             |  | 2003 |     | 2002
|               |  |                    |     |                  |  |      |     |     
|               |  | (UNAUDITED)        |     | (UNAUDITED)     
|               |  |                    |     |                 
|Total revenues |  |                    | 100 | %                |  |      | 100 | %    |  |  | 100 | % |  |  | 100 | %

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|                   |  |                    |       |                  |  |      |       |      |  |  |       |    |  |  |       |   
|------------------ |  | ------------------ | ----- | ---------------- |  | ---- | ----- | ---- |  |  | ----- | -- |  |  | ----- | --
|                   |  | Three months Ended |       | Six months Ended
|                   |  | February 28,       |       | February 28,    
|                   |  |                    |       |                 
|                   |  | 2003               |       | 2002             |  | 2003 |       | 2002
|                   |  |                    |       |                  |  |      |       |     
|                   |  | (UNAUDITED)        |       | (UNAUDITED)     
|                   |  |                    |       |                 
|Cost of revenues   |  |                    | 63.2  | %                |  |      | 61.5  | %    |  |  | 60.3  | %  |  |  | 62.2  | % 
|                   |  |                    |       |                  |  |      |       |      |  |  |       |    |  |  |       |   
|Gross profit       |  |                    | 36.8  | %                |  |      | 38.5  | %    |  |  | 39.7  | %  |  |  | 37.8  | % 
|Operating expenses |  |                    | 47.2  | %                |  |      | 46.0  | %    |  |  | 44.3  | %  |  |  | 49.3  | % 
|                   |  |                    |       |                  |  |      |       |      |  |  |       |    |  |  |       |   
|Operating loss     |  |                    | (10.4 | )%               |  |      | (7.5  | )%   |  |  | (4.6  | )% |  |  | (11.5 | )%
|Interest expense   |  |                    | (1.1  | )%               |  |      | (5.9  | )%   |  |  | (3.7  | )% |  |  | (6.5  | )%
|Professional fees  |  |                    | (6.8  | %)               |  |      |      |      |  |  | (3.3  | %) |  |  |       |   
|                   |  |                    |       |                  |  |      |       |      |  |  |       |    |  |  |       |   
|Net loss           |  |                    | (8.3  | %)               |  |      | (13.4 | %)   |  |  | (11.6 | %) |  |  | (18.0 | %)
|                   |  |                    |       |                  |  |      |       |      |  |  |       |    |  |  |       |   

COMPARISON OF THE THREE MONTHS ENDED FEBRUARY 28, 2003 TO THE THREE MONTHS
ENDED FEBRUARY 28, 2002

Revenues for the three months ended February 28, 2003 and 2002 were $2,359,288
and $2,523,723, respectively, representing a 6.5% decrease in sales. This
decline was primarily attributable to declines in sales to two customers,
Gibralter Publishing, Inc. and Lowes Home Improvement of $160,815 and $342,189,
respectively during the three-month period ended February 28, 2003 compared to
the same period in 2002. The decline from these two customers was
substantially offset through the addition of traditional outbound calling
contracts.

Cost of revenues of $1,490,174 and $1,552,946, respectively for the three
months ended February 28, 2003 and 2002 were 63.2% and 61.5% of revenue for the
periods. The decrease in cost of revenues and increase as a percentage of
revenue from the three months ended February 28, 2002 to February 28, 2003 was
due entirely to slightly lower sales volume. Correspondingly, gross profit
declined $101,663, 10%, from February 28, 2002 to February 28, 2003 and gross
margin declined from 38.5% to 36.8%. This decline is a result of slightly
lower sales volume that was not directly reflected in lower costs to provide
these sales.

Operating expenses, including depreciation and amortization, have increased as
percentage of revenue to 47.2% from 46% for the three months ended February 28,
2003 and 2002, respectively but actually declined from $1,162,976 to $1,114,860
during these periods. This decline of $48,116 was the result of cost
reductions in payroll and travel related costs

Interest expense decreased from $149,828 to $26,362, during the three months
ended February 28, 2002 as compared to the three months ended February 28,
2003. As a percentage of revenue this decrease is from 5.9% to 1.1% and is
attributable to the conversion of the $5,000,000 notes payable to Gibralter
into Series D preferred stock.

Professional fees consist of legal fees related to the Companys sale of a
majority interest of its common stock in February 2003 and various other
actions related to the special shareholders meeting. These fees, shown as
non-operating expenses, are non-recurring in nature. These costs of $161,02
for the three months ended February 28, 2003 are 6.8% of revenue. For the
three months ended February 28, 2002, none of these costs were present.

Net loss for the three months ended February 28, 2003 and 2002 was $443,329 and
$352,227, respectively. This increase of $91,102 in the loss from 2002 to 2003
represents a 25.8% increase in net loss. This increase is due primarily to
increased professional fees related to the sale of the controlling interest in
the Company in February 2003.

COMPARISON OF THE SIX MONTHS ENDED FEBRUARY 28, 2003 TO THE SIX MONTHS ENDED
FEBRUARY 28, 2002

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Revenues for the six months ended February 28, 2003 and 2002 were $4,834,338
and $4,963,999, respectively, representing a 2.6% decline in sales. This small
decline is a combination of significant decreases from two customers discussed
below and an increase in traditional outbound calling contracts. Gibralter
Publishing, Inc. and Lowes Home Improvement accounted for a decline of $248,344
and $753,480, respectively during the six-month period ended February 28, 2003
compared to the same period in 2002. These declines were substantially offset
by an increase in outbound calling contracts resulting in only a 2.6% overall
decline.

Cost of revenues of $2,917,050 and $3,087,585, respectively for the six months
ended February 28, 2003 and 2002 were 60.3% and 62.2% of revenue for the
periods. The slight decrease in cost of revenues of $170,535 from the six
months ended February 28, 2002 to February 28, 2003 is due to a slightly lower
cost structure for telephone costs and slightly lower payroll costs. Gross
profit increased to $1,917,288 from $1,876,414 respectively for the six months
ended February 28, 2003 and 2002 and gross margin increased to 39.7% from
37.8%. The slight increase in gross profit of $40,874 results from the slightly
lower telephone costs incurred in the six months ended February 28, 2003
compared to the period ended February 28, 2002.

Operating expenses of $2,140,112 and $2,448,406, respectively for the six
months ended February 28, 2003 and 2002 were 44.2% and 49.3% of revenue for
these periods. The decline of $308,294 is due to continued cost cutting
actions taken since the prior period.

Interest expense declined 45% from $322,994 to $177,876 from the six months
ended February 28, 2002 to February 28, 2003. As a percentage of revenue,
interest expense declined from 6.5% to 3.6% from the six months ended February
28, 2002 to February 28, 2003. This decrease is attributable almost entirely
to reduced borrowings following the conversion of the $5,000,000 in notes
payable to Gibralter into Series D preferred stock.

Professional fees consist of legal fees related to the Companys sale of a
majority interest of its common stock in February 2003 and various other
actions related to the special shareholders meeting. These fees, shown as
non-operating expenses, are non-recurring in nature. These costs of $161,02
for the six months ended February 28, 2003 are 3.3% of revenue. For the six
months ended February 28, 2002, none of these costs were present.

Net loss for the six months ended February 28, 2003 and 2002 was $582,121 and
$915,386, respectively. This decrease of $333,265 in the loss from 2002 to
2003 represents a 36.4% decrease in net loss. This decrease is due primarily
to decreased interest costs and the decline in operating costs discussed above.

LIQUIDITY AND CAPITAL RESOURCES

The Companys principal cash requirements are for operating expenses, including
employee costs, funding of accounts receivable and funding of the operations.
The sale of common stock to the Companys new majority owners in February 2003
resulted in a change in the source of funds for short-term cash needs. The new
controlling shareholders invested approximately $370,000 in cash and assumed
liabilities of approximately $380,000. They also have provided an unsecured,
two-year loan facility for the Company of up to an additional $635,000, of
which $190,000 was outstanding at February 28, 2003. Amounts outstanding under
this facility bear interest at 7.0%. These funds, along with the Companys
cash flows from operations, are expected to provide adequate liquidity to meet
the Companys minimum cash requirements for the next six months. The Company
is actively seeking a lender for an asset-based loan facility to augment its
cash needs in the near term and to provide necessary liquidity for the next
twelve months. If the Company is unable to obtain such a facility, the Company
will seek other sources of liquidity, in the form of either equity or debt
financing. There can be no assurance that the Company will be able to obtain
such financing on acceptable terms or at all.

The Companys prior bank line of credit of $350,000 is past due and in default.
The bank has sued to recover all amounts owed under this facility. The
Company plans to repay this borrowing with either the $635,000 loan facility
that is in place or a new asset-based loan facility.

Cash used in operating activities was $736,652 for the six months ended
February 28, 2003. This was due primarily to operating losses caused by the
revenue levels that are at less than a breakeven volume and

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professional fees of $161,021 related to the February 2003 sale of the
Companys common stock. The Company invested $18,731 in computers and
leasehold improvements during this period.

While the Company has raised capital to meet its working capital requirements
in the past, additional financing may be required in order to meet liquidity
needs in the future. The Company is seeking financing in the form of debt to
provide for these needs. There are no assurances the Company will be
successful in obtaining the debt required.

In prior periods, certain shareholders have loaned money to or guaranteed
indebtedness of the Company to satisfy certain obligations. No assurance can be
given that such shareholders would guarantee any further indebtedness or that
they would not seek to withdraw their existing guarantees.

The Company intends to continue to expand it operations through acquisitions of
businesses that will broaden the Companys current services in the customer
relationship management (CRM) area and provide opportunities for complementary
selling opportunities. The Company would likely issue shares of common stock
as consideration in these acquisitions. There can be no assurance that the
Company will continue to find suitable acquisition candidates or that the
Company will be able to successfully integrate any acquisition.

The Companys independent certified public accountants have stated in their
report included in the Companys August 31, 2002 Form 10-KSB, that the Company
has incurred operating losses in the last two years, and that the Company is
dependent upon managements ability to develop profitable operations. These
factors among others may raise substantial doubt about the Companys ability to
continue as a going concern.

INFLATION

In the opinion of management, inflation has not had a material effect on the
operations of the Company.

DISCLOSURE REGARDING FORWARD LOOKING STATEMENTS

Certain statements made in this report, and other written or oral statements
made by or on behalf of the Company may constitute forward-looking statements
under the Private Securities Litigation Reform Act of 1995. When used in this
report, the words believes, expects, estimates, intends, will and
similar expressions are intended to identify forward-looking statements.
Statements regarding future events and developments and our future performance,
as well as the Companys expectations, beliefs, plans, intentions, estimates or
projections relating to the future, are forward-looking statements within the
meaning of these laws. Examples of such statements in this report include the
Companys current plans for improving liquidity and its future acquisition
plans. Forward-looking statements involve risks and uncertainties that could
cause actual results to differ materially from those expressed in or implied by
the statements, including, but not limited to the ability of the Company to
provide for its debt obligations and to provide for working capital needs from
operating revenue; general economic conditions; the ability to integrate
acquisitions successfully and without disruptions to normal operations; and
other risks detailed in the Companys periodic report filings with the
Securities and Exchange Commission. The Company believes that these
forward-looking statements are reasonable; however, you should not place undue
reliance on such statements. These statements are based on current expectations
and speak only as of the date of such statements. The Company undertakes no
obligation to publicly update or revise any forward-looking statement, whether
as a result of future events, new information or otherwise.

ITEM 3. CONTROLS AND PROCEDURES

Evaluation and Disclosure of Controls and
Procedures
On March 12, 2003, we made an evaluation of our disclosure controls and
procedures. Disclosure controls and procedures are those designed to ensure
that information required to be disclosed in our SEC reports is recorded,
processed, summarized and reported in a timely fashion. In the opinion of our
Chief Executive and Chief Financial Officer, the disclosure controls and
procedures are effective because they ensure

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efficient and effective evaluation and communication to management of all
information required to be disclosed in our SEC reports and permit management
sufficient time to evaluate such information.

Changes in Internal Controls
There have been no significant changes in our internal controls or in other
factors that could significantly affect these controls since the last
evaluation. The evaluation did not reveal any significant deficiencies or
material weaknesses in our internal control system.

16



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PART II




ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS



| |  | On February 4, 2003, at a special meeting of the Companys shareholders
(the Special Meeting) the Companys shareholders approved an amendment
to the Companys Certificate of Incorporation to effect a one-for-ten
reverse split of the Companys outstanding Common Stock (the Reverse
Split). The Reverse Split became effective at 12:01 a.m. on February 5,
2003, at which time each share of Common Stock issued and outstanding was
reclassified as and changed into one-tenth (1/10th) of a share of the
Companys Common Stock. Any fractional share interest resulting from the
Reverse Split was rounded to the nearest whole share. All outstanding
options and warrants were automatically adjusted into economically
equivalent options or warrants by decreasing the number of underlying
shares of Common Stock by a factor of ten and, if applicable, increasing
the exercise price by a factor of ten. The number of shares of Common
Stock authorized for issuance by the Company remained unchanged at
75,000,000, but the number of issued and outstanding shares was reduced
from 36,802,738 shares to 3,680,274 shares (prior to the issuance of a
total of 8,880,740 shares to the new majority ownership group discussed
under (c) below).
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | n/a                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|
| |  | At the Special Meeting, the Companys shareholders also approved a Stock
Purchase Agreement dated January 9, 2003 among the Company and WAG
Holdings, LLC, Glen H. Hammer and A. Randall Barkowitz (the Buyers).
Pursuant to the Stock Purchase Agreement, on February 5, 2003, the Company
issued an aggregate of 8,880,740 shares to the Buyers. The total
consideration for the shares was $750,000, paid in a combination of (i)
the cancellation of approximately $380,000 owing from the Company to the
Buyers and (ii) the cancellation of certain outstanding obligations owing
from the Company to various third parties.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| |  | The issuance of the shares to the Buyers was exempt from the registration
requirements of the Securities Act of 1933 (the Act) pursuant to Section
4(2) of the Act and the safe harbor provided by Rule 506 of Regulation D
under the Act. Each of the Buyers represented to the Company that he or it
was an accredited investor as defined in Regulation D.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       




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

On February 4, 2003, a special meeting of the shareholders of the Company was
held to consider and vote on the following proposals: (1) a one-for-ten reverse
stock split of the Companys outstanding Common Stock (Proposal 1); (2)
approval of a Stock Purchase Agreement pursuant to which an aggregate of
8,880,740 post-reverse split shares would be issued to WAG Holdings, LLC, Glen
H. Hammer and A. Randall Barkowitz (Proposal 2); and (3) an amendment to the
Companys certificate of incorporation to change the name of the Company to
Market Central, Inc. (Proposal 3). Set forth below are the results of the
shareholders vote on each proposal:

|           |  |     |            |         |  |         |     |  |  |  |        | 
|---------- |  | --- | ---------- | ------- |  | ------- | --- |  |  |  | ------ | 
|           |  | For |            | Against |  | Abstain
|           |  |     |            |         |  |        
|Proposal 1 |  |     | 22,133,278 |         |  |         | -0- |  |  |  | 30,000 | 
|Proposal 2 |  |     | 22,162,635 |         |  |         | -0- |  |  |  | 643    | 
|Proposal 3 |  |     | 22,163,278 |         |  |         | -0- |  |  |  | -0-    | 




ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K



| |             
| | ------------
| | (a) Exhibits

| |  |  |     |  |  |                                                                                                                                                                                                                 |  |  |  | 
| |  |  | --- |  |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  |  | 
| |  |  | No. |  |  | Description                                                                                                                                                                                                     |  |  |  | 
| |  |  |     |  |  |                                                                                                                                                                                                                 |  |  |  | 
| |  |  | 2.1 |  |  | Stock Purchase Agreement dated April 3, 2003 by
and among the Registrant and each of the stockholders of U.S.
Convergion, Inc. (incorporated by reference from Current
Report on Form 8-K dated April 3, 2003).
| |  |  |     |  |  |                                                                                                                                                                                                                
| |  |  | 3.1 |  |  | Amendment to Certificate of Incorporation of Company                                                                                                                                                           

17



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##### Table of Contents



| |  |  |      |  |  |                                                                                                                                                                                                                              |  |  |  | 
| |  |  | ---- |  |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  |  | 
| |  |  |      |  |  | No. Description                                                                                                                                                                                                              |  |  |  | 
| |  |  |      |  |  |                                                                                                                                                                                                                              |  |  |  | 
| |  |  | 3.2  |  |  | Amendment to Bylaws of Company                                                                                                                                                                                              
| |  |  | 10.1 |  |  | Stock Purchase Agreement dated January 9, 2003
by and among the Registrant and WAG Holdings, LLC, Glen H.
Hammer and A. Randall Barkowitz (incorporated by reference
from Current Report on Form 8-K dated February 5, 2003.
| |  |  |      |  |  |                                                                                                                                                                                                                             
| |  |  | 99.1 |  |  | Certification of Terrence Leifheit Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                               
| |  |  |      |  |  |                                                                                                                                                                                                                             
| |  |  | 99.2 |  |  | Certification of Clifford A. Clark Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                               

|    |  |                                                                                                                                                                                                                                  
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(b) |  | Reports on Form 8-K                                                                                                                                                                                                              
|    |  | The Company filed a Current Report on Form 8-K dated February 5,
2003, reporting under Item 1- Change in Control, the issuance of an
aggregate of 8,880,740 shares to WAG Holdings, LLC, Glen H. Hammer
and A. Randall Barkowitz.

18



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##### Table of Contents






SIGNATURES

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

| |  |       |  |                |    |                                                                             
| |  | ----- |  | -------------- | -- | ----------------------------------------------------------------------------
| |  |       |  |                |    | MARKET CENTRAL, INC.                                                        
|
| |  |       |  |                |    |                                                                             
|
| |  | Date: |  | April 11, 2003 | By | /s/ Terrence LeifheitTerrence Leifheit
President and Chief Executive Officer
|
| |  |       |  |                |    |                                                                             
|
| |  | Date: |  | April 11, 2003 | By | /s/ Clifford ClarkClifford Clark
Chief Financial Officer                    

19



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##### Table of Contents






CERTIFICATION

I, Terrence Leifheit, certify that:



| | 1. |  | I have reviewed this Quarterly Report on Form 10-QSB of
Market Central, Inc.,                                                                                                                                                                                                                                                 
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | 2. |  | Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by this quarterly report;
|
| | 3. |  | Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly
present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the
periods presented in this quarterly report;                   
|
| | 4. |  | The registrants other certifying officer and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for
the registrant and have:                                                                                                         

|   |  |                                                                                                                                                                                                                                                                                                
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|a) |  | Designed such disclosure controls and procedures to
ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in
which this quarterly report is being prepared;
|b) |  | Evaluated the effectiveness of the registrants
disclosure controls and procedures as of a date within 90 days
prior to the filing date of this quarterly report (the
Evaluation Date); and                                                                                                  
|c) |  | Presented in this quarterly report our conclusions
about the effectiveness of the disclosure controls an
procedures based on our evaluation as of the Evaluation Date;                                                                                                                         



| | 5. |  | The registrants other certifying officer and I have
disclosed, based on our most recent evaluation, to the registrants
auditors and the audit committee of registrants board of directors:
| | -- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |                                                                                                                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | a) All significant deficiencies in the design or
operation of internal controls which could adversely affect the
registrants ability to record, process, summarize and report
financial data and have identified for the registrants
auditors any material weaknesses in internal controls, and
|
| | b) Any fraud, whether or not material, that involves
management or other employees who have a significant role in
the registrants internal controls; and                                                                                                                                        



| | 6. |  | The registrants other certifying officer and I have
indicated in this quarterly report whether there were significant
changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of our
most recent evaluation including any corrective actions with regard
to significant deficiencies and material weaknesses.
| | -- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Date:     April 11, 2003

| |  |  |  |                                                           
| |  |  |  | ----------------------------------------------------------
| |  |  |  | /s/ Terrence J. Leifheit                                  
| |  |  |  |                                                           
| |  |  |  | Terrence J. Leifheit
President and Chief Executive Officer

20



---



##### Table of Contents



CERTIFICATION

I, Clifford A. Clark, certify that:



| | 1. |  | I have reviewed this Quarterly Report on Form 10-QSB of
Market Central, Inc.,                                                                                                                                                                                                                                                 
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | 2. |  | Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by this quarterly report;
|
| | 3. |  | Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly
present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the
periods presented in this quarterly report;                   
|
| | 4. |  | The registrants other certifying officer and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for
the registrant and have:                                                                                                         



| |                                                                                                                                                                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | a) Designed such disclosure controls and procedures to
ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in
which this quarterly report is being prepared;
|
| | b) Evaluated the effectiveness of the registrants
disclosure controls and procedures as of a date within 90 days
prior to the filing date of this quarterly report (the
Evaluation Date); and                                                                                                  
|
| | c) Presented in this quarterly report our conclusions
about the effectiveness of the disclosure controls an
procedures based on our evaluation as of the Evaluation Date;                                                                                                                         



| | 5. |  | The registrants other certifying officer and I have
disclosed, based on our most recent evaluation, to the registrants
auditors and the audit committee of registrants board of directors:
| | -- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |                                                                                                                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | a) All significant deficiencies in the design or
operation of internal controls which could adversely affect the
registrants ability to record, process, summarize and report
financial data and have identified for the registrants
auditors any material weaknesses in internal controls, and
|
| | b) Any fraud, whether or not material, that involves
management or other employees who have a significant role in
the registrants internal controls; and                                                                                                                                        



| | 6. |  | The registrants other certifying officer and I have
indicated in this quarterly report whether there were significant
changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of our
most recent evaluation including any corrective actions with regard
to significant deficiencies and material weaknesses.
| | -- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                      |  |  |  |                                          
|--------------------- |  |  |  | -----------------------------------------
|Date:  April 11, 2003 |  |  |  | /s/ Clifford A. Clark                    
|                      |  |  |  |                                          
|                      |  |  |  | Clifford A. Clark
Chief Financial Officer

21