U.S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                   FORM 10-QSB

        (MARK ONE)

     |X|   Quarterly Report Pursuant to Section 13 or 15(d) of Securities
           Exchange Act of 1934

                         For the quarterly period ended JUNE 30, 2001

     |_|   Transition report under Section 13 or 15(d) of the Securities
           Exchange Act of 1934

                      For the transition period from _______ to _______.

                          Commission File No. 000-29689

                               USWEBAUCTIONS, INC.
                        (Name of Small Business Issuer in Its Charter)

FLORIDA                                                      65-0986953
-------                                                      ----------
(State or Other Jurisdiction of Incorporation                (I.R.S. Employer
or Organization)                                             Identification No.)

22 SOUTH LINKS AVENUE, STE. 204, SARASOTA, FLORIDA           34236
--------------------------------------------------           -----
(Address of Principal Executive Offices)                     (Zip Code)

                                 (941) 330-8051
                                 --------------
                (Issuer's Telephone Number, Including Area Code)

        Check whether the issuer:  (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange  Act during the past 12 months,  and (2) has
been subject to such filing requirements for the past 90 days.
Yes  |X|   No  |_|

        There were 9,751,100 shares of Common Stock outstanding as of August 17,
2001.






















                                       2
<PAGE>

PART I


FINANCIAL INFORMATION.


ITEM 1. FINANCIAL STATEMENTS.





<PAGE>





















                               USWEBAUCTIONS, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                              FINANCIAL STATEMENTS

                       JUNE 30, 2001 AND DECEMBER 31, 2000





<PAGE>

<TABLE>
<CAPTION>
                                        USWEBAUCTIONS, INC.
                                   (A Development Stage Company)
                                          Balance Sheets


                                              ASSETS

                                                                   June 30,         December 31,
                                                                     2001               2000
                                                                     ----               ----
                                                                 (Unaudited)
<S>                                                             <C>                <C>
CURRENT ASSETS

   Cash                                                         $            -     $             -
                                                                 -------------      --------------
      Total Current Assets                                                   -                   -
                                                                 -------------      --------------

OTHER ASSETS

   Note receivable - related party (Note 3)                                  -             563,152
   Interest receivable - related party (Note 3)                              -              53,174
                                                                 -------------      --------------
      Total Other Assets                                                     -             616,326
                                                                 -------------      --------------
TOTAL ASSETS                                                    $            -     $       616,326
                                                                 -------------      --------------

                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES

   Accounts payable                                             $       65,181    $         75,988
   Bank overdraft                                                            8              12,905
                                                                 -------------      --------------
      Total Current Liabilities                                         65,189              88,893
                                                                 -------------      --------------

STOCKHOLDERS' EQUITY (DEFICIT)

   Preferred stock authorized: 10,000,000 preferred shares at
      $0.001 par value; -0- shares issued and outstanding                    -                   -
   Common stock authorized: 50,000,000 common shares at
      $0.001 par value; 9,751,100 and 9,930,100 shares issued
      and outstanding, respectively                                      9,751               9,930
   Capital in excess  of par value                                   1,119,999           1,164,595
   Stock subscription receivable                                      (500,000)           (500,000)
   Deficit accumulated during the development stage                   (694,939)           (147,092)
                                                                 -------------      --------------
      Total Stockholders' Equity (Deficit)                             (65,189)            527,433
                                                                 -------------      --------------

      TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)      $            -     $       616,326
                                                                 =============      ==============

            The accompanying notes are an integral part of these financial statements.
</TABLE>


                                                4
<PAGE>

<TABLE>
<CAPTION>
                                          USWEBAUCTIONS, INC.
                                     (A Development Stage Company)
                                        Statements of Operations
                                              (Unaudited)



                                                                                              From
                                                                                          Inception on
                                              For the                    For the          July 10, 1997
                                         Six Months Ended          Three Months Ended        Through
                                             June 30,                   June 30,            June 30,
                                        ------------------          -----------------       --------
                                        2001          2000          2001         2000         2001
                                     ------------  ------------  ----------- ------------  ------------
<S>                                  <C>            <C>           <C>          <C>          <C>
 REVENUES                            $          -   $         -   $            $        -   $         -

 EXPENSES

    Bad debt                               23,333             -            -            -        23,333
    General and administrative            524,514        72,828       21,749       97,828       724,780
                                     ------------   -----------   ----------   ----------   -----------
       Total Expenses                     547,847        72,828       21,749       97,828       748,113
                                     ------------   -----------   ----------   ----------   -----------
 OTHER INCOME

    Interest income                             -           580            -          580        53,174
                                     ------------   -----------   ----------   ----------   -----------
       Total Other Income                       -           580            -          580        53,174
                                     ------------   -----------   ----------   ----------   -----------
 NET LOSS                            $   (547,847)  $   (72,248)  $  (21,749)  $  (97,248)  $  (694,939)
                                     ============   ===========   ==========   ==========   ===========
 BASIC LOSS PER SHARE                $      (0.06)  $     (0.01)  $    (0.06)  $    (0.02)
                                     ============   ===========   ==========   ==========
 WEIGHTED AVERAGE NUMBER OF SHARES      9,715,550     5,672,572    9,715,550    5,336,264
                                     ============   ===========   ==========   ==========

              The accompanying notes are an integral part of these financial statements.
</TABLE>




                                                   5
<PAGE>

<TABLE>
<CAPTION>
                                            USWEBAUCTIONS, INC.
                                       (A Development Stage Company)
                                    Statements of Stockholders' Equity
                           From Inception on July 10, 1997 Through June 30, 2001



                                                                                                Deficit
                                                                                              Accumulated
                                                Common Stock        Additional     Stock      During the
                                             -------------------     Paid-in    Subscription  Development
                                             Shares       Amount     Capital     Receivable      Stage
                                             ------       ------     -------     ----------      -----
<S>                                          <C>          <C>        <C>         <C>           <C>
Balance at inception on July 10, 1997                -    $      -  $      -     $        -    $      -

Common stock issued for services             5,000,000       5,000     (3,000)             -           -

Net loss from inception on July 10, 1997
   to December 31, 1997                              -           -          -              -      (2,000)
                                             ---------    --------   --------    -----------   ---------
Balance, December 31, 1997                   5,000,000       5,000     (3,000)             -      (2,000)

Net loss for the year ended December 31,
   1998                                              -           -           -             -           -
                                             ---------    --------   --------    -----------   ---------
Balance, December 31, 1998                   5,000,000       5,000     (3,000)             -      (2,000)

Net loss for the year ended December 31,
   1999                                              -           -           -             -           -
                                             ---------    --------   --------    -----------   ---------
Balance, December 31, 1999                   5,000,000       5,000     (3,000)             -      (2,000)

Common stock issued for cash at $0.25
   per share on June 10, 2000                3,060,000       3,060    761,940       (500,000)          -

Common stock issued for cash at $0.25
   per share on September 21, 2000           1,800,000       1,800    448,200              -           -

Stock offering costs                                 -           -    (60,000)             -           -

Common stock issued for cash at $0.25
   per share on October 19, 2000                50,100          50     12,475              -           -

Common stock issued for cash at $0.25
   per share on October 31, 2000                20,000          20      4,980              -           -

Net loss for the year ended December 31,
   2000                                              -           -           -             -    (145,092)
                                             ---------    -------- ----------    -----------   ---------
Balance, December 31, 2000                   9,930,100    $  9,930 $1,164,595    $  (500,000)  $(147,092)
                                             =========    ======== ==========    ===========   =========

                The accompanying notes are an integral part of these financial statements.
</TABLE>



                                                    6
<PAGE>

<TABLE>
<CAPTION>
                                            USWEBAUCTIONS, INC.
                                       (A Development Stage Company)
                              Statements of Stockholders' Equity (Continued)
                           From Inception on July 10, 1997 Through June 30, 2001


                                                                                               Deficit
                                                                                             Accumulated
                                              Common Stock         Additional     Stock      During the
                                           -------------------      Paid-in    Subscription  Development
                                           Shares       Amount      Capital     Receivable      Stage
                                           ------       ------      -------     ----------      -----
<S>                                      <C>             <C>       <C>           <C>           <C>
Balance, December 31, 2000               9,930,100       $9,930    $1,164,595    $  (500,000) $ (147,092)

Cancellation of stock at $2.00 per
   share on March 31, 2001
   (unaudited)                            (250,000)        (250)      (62,250)            -            -

Common stock issued for services at
   $0.25 per share on April 1, 2001         70,900           71        17,654             -            -

Net loss for the six months ended
   June 30, 2001 (unaudited)                     -            -             -             -     (547,847)
                                         ---------       ------    ----------    -----------   ---------
Balance, June 30, 2001 (unaudited)       9,751,000       $9,751    $1,119,999    $  (500,000)  $(694,939)
                                         =========       ======    ==========    ===========   =========


                The accompanying notes are an integral part of these financial statements.
</TABLE>


















                                                    7
<PAGE>

<TABLE>
<CAPTION>
                                            USWEBAUCTIONS, INC.
                                       (A Development Stage Company)
                                         Statements of Cash Flows
                                                (Unaudited)

                                                                                                               From Inception on
                                                                                 For the                         July 10, 1997
                                                                             Six Months Ended                       Through
                                                                                 June 30,                           June 30,
                                                                   ---------------------------------     ---------------------------
                                                                       2001               2000                       2001
                                                                   ---------------   ---------------     ---------------------------
<S>                                                               <C>                <C>                  <C>
CASH FLOWS FROM OPERATING ACTIVITIES

     Net loss                                                     $     (547,847)    $      (25,000)      $        (694,939)
     Adjustments to reconcile net loss to net cash used
      by operating activities:
         Issuance of stock for services                                   17,725                  -                  19,725
         Decrease in notes payable for services rendered                 440,926                  -                 440,926
     Changes in operating assets and liability accounts:
         (Increase) decrease in interest receivable                       53,174                  -                       -
         Decrease in bank overdraft                                      (12,897)                 -                       8
         Increase (decrease) in accounts payable                          48,919                  -                 124,907
                                                                   -------------           --------         ---------------
             Net Cash (Used) by Operating Activities                           -            (25,000)               (109,373)
                                                                   -------------           --------         ---------------
CASH FLOWS FROM INVESTING ACTIVITIES                                           -                  -                       -
                                                                   -------------           --------         ---------------
CASH FLOWS FROM FINANCING ACTIVITIES

     Cash loaned on notes receivable - related party                           -                  -                (707,152)
     Cash received on notes receivable - related party                         -             25,000                 144,000
     Stock offering costs                                                      -                  -                 (60,000)
     Issuance of stock for cash                                                -                  -                 732,525
                                                                   -------------           --------         ---------------
             Net Cash Provided by Financing Activities                         -             25,000                 109,373
                                                                   -------------           --------         ---------------
NET INCREASE (DECREASE) IN CASH                                                -                  -                       -

CASH AT BEGINNING OF PERIOD                                                    -                  -                       -
                                                                   -------------           --------         ---------------
CASH AT END OF PERIOD                                           $                    $                     $              -
                                                                   =============           ========         ===============
CASH PAYMENTS FOR:

     Income taxes                                               $              -     $           -         $              -
     Interest                                                   $              -     $           -         $              -

SCHEDULE OF NON-CASH FINANCING ACTIVITIES:

     Common stock issued for services                           $         17,725     $           -         $          2,000
     Stock subscription receivable                              $              -     $           -         $        500,000
     Cancellation of common stock                               $         62,500     $           -         $         62,500
     Payment of accounts receivable by related parties          $         59,726     $           -         $         59,726

                     The accompanying notes are an integral part of these financial statements.
</TABLE>




                                                    8
<PAGE>

                               USWEBAUCTIONS, INC.
                          (A Development Stage Company)
                        Notes to the Financial Statements



NOTE 1 -       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


a.  ORGANIZATION

               August Project I Corporation  (the  "Company") was organized July
               10,  1997 under the laws of the State of Florida  for the purpose
               of  engaging  in any  lawful  activity.  On April 20,  2000,  the
               Company's name was changed to USWEBAUCTIONS,  Inc., in connection
               with a failed  acquisition  of  USWEBAUCTIONS,  INC.,  a  private
               company.  The Company  has had no  significant  operations  since
               inception  and is  considered  a  development  stage  company  in
               accordance with Statement of Financial  Accounting  Standards No.
               7.


b.  PROVISION FOR TAXES

               No provision  for federal  income taxes has been made at June 30,
               2001 due to accumulated operating losses.

               The  Company  has  accumulated   approximately  $695,000  of  net
               operating losses as of June 30, 2001, which may be used to reduce
               taxable income and income taxes in future years through 2020. The
               use of these losses to reduce  future income taxes will depend on
               the  generation  of  sufficient   taxable  income  prior  to  the
               expiration of the net operating loss carryforwards.

               In the event of certain changes in control of the Company,  there
               will be an annual  limitation on the amount of net operating loss
               carryforwards  which can be used.  The  potential tax benefits of
               the net operating loss carryforwards of $695,000 have been offset
               by a valuation allowance of the same amount.


c.  ACCOUNTING METHOD

               The financial statements are prepared using the accrual method of
               accounting. The Company has elected a calendar year end.


d.  ESTIMATES

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


e.  CASH AND CASH EQUIVALENTS

               The  Company  considers  all  highly  liquid  investments  with a
               maturity  of  three  months  or less  when  purchased  to be cash
               equivalents.


                                       9
<PAGE>

                               USWEBAUCTIONS, INC.
                          (A Development Stage Company)
                        Notes to the Financial Statements

NOTE 1 -       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

f.  BASIC LOSS PER SHARE

               The following is an  illustration  of the  reconciliation  of the
               numerators  and   denominators   of  the  basic  loss  per  share
               calculation:

<TABLE>
                                                                                          For the
                                                                                       Six Months Ended
                                                                                        June 30, 2001
                                                                            ---------------------------------------
                                                                               2001                     2000
                                                                            ----------------      -----------------
                                                                              (Unaudited)            (Unaudited)
<S>                                                                          <C>                   <C>
               Net loss (numerator)                                          $       (547,847)     $       (25,000)

               Weighted average shares outstanding (denominator)                    9,715,550            5,672,572
                                                                             -----------------     ----------------
               Basic loss per share                                          $          (0.06)     $         (0.01)
</TABLE>

               Basic loss per share has been  calculated  based on the  weighted
               average number of shares of common stock  outstanding  during the
               period.

g.  REVENUE RECOGNITION

               The  Company  currently  has  no  source  of  revenues.   Revenue
               recognition policies will be determined when principal operations
               begin.

h.  UNAUDITED FINANCIAL STATEMENTS

               The accompanying  unaudited  financial  statements include all of
               the  adjustments  which,  in  the  opinion  of  management,   are
               necessary  for a fair  presentation.  Such  adjustments  are of a
               normal recurring nature.

NOTE 2 -       GOING CONCERN

               The Company's  financial  statements are prepared using generally
               accepted  accounting  principles  applicable  to a going  concern
               which  contemplates  the realization of assets and liquidation of
               liabilities in the normal course of business. The Company has not
               established  revenues sufficient to cover its operating costs and
               allow it to continue as a going  concern.  Management  intends to
               raise additional  funds through private  placements and to seek a
               merger with an existing,  operating company.  In the interim,  it
               has  committed  to  meeting  the  Company's   minimal   operating
               expenses.

NOTE 3 -       CANCELLATION OF PROPOSED MERGER

               The Company's merger with USWEBAUCTIONS,  INC. was rescinded. All
               of the shares issued have been canceled and returned.


                                       10
<PAGE>

                               USWEBAUCTIONS, INC.
                          (A Development Stage Company)
                        Notes to the Financial Statements

NOTE 4 -       STOCK TRANSACTIONS

               On June 10, 2000, the Company issued  3,060,000  shares of common
               stock  valued at $0.25 per share for cash.  At December 31, 2000,
               the Company has received  $761,940  and has a stock  subscription
               receivable for $500,000.

               On September 21, 2000,  the Company  issued  1,800,000  shares of
               common  stock  valued at $0.25 per  share for cash.  The  Company
               received $450,000 and paid stock offering costs of $60,000.

               On October 19, 2000,  the Company  issued 50,100 shares of common
               stock valued at $0.25 per share for cash and received $12,525.

               On October 31, 2000,  the Company  issued 20,000 shares of common
               stock valued at $0.25 per share for cash and received $5,000.

               On March 31, 2001, the Company  canceled 250,000 shares of common
               stock valued at $0.25 per share and reduced accounts  receivables
               from related parties.

               On April 4, 2001,  the  Company  issued  70,900  shares of common
               stock valued at $0.25 per share for services.

NOTE 5 -       SUBSEQUENT EVENTS

               On July 12,  2001,  USWebAuctions,  Inc.  (USWA) and A1 Cellular,
               Inc.  signed a stock purchase  agreement  whereby USWA will issue
               10,800,000  shares of its common stock in exchange for all of the
               outstanding common stock of A1 Cellular,  Inc.  Immediately prior
               to  the  Agreement  and  Plan  of  Merger,   USWA  had  2,000,000
               post-split  shares of common  stock issued and  outstanding.  The
               acquisition  will be accounted  for as a  recapitalization  of A1
               Cellular, Inc. because the shareholders of A1 Cellular, Inc. will
               control USWA after the  acquisition.  A1 Cellular,  Inc.  will be
               treated as the acquiring entity for accounting  purposes and USWA
               will be the surviving entity for legal purposes. There will be no
               adjustment to the carrying  value of the assets or liabilities of
               A1  Cellular,  Inc.,  nor  will  there be any  adjustment  to the
               carrying value of the net assets of USWA.  Costs  associated with
               this transaction will be expensed as incurred.  As of the date of
               the stock purchase agreement, USWA had authorized a reverse stock
               split of 1 for 4.84  shares.  The  reverse  stock  split  has not
               ocurred as of the date of this 10-QSB. It is anticipated that the
               total  shares of USWA  outstanding  prior to the  merger  will be
               2,000,000 shares of common stock. Subsequent to the merger, there
               will be 12,800,000 shares of common stock outstanding.


                                       11
<PAGE>
ITEM 2. MANAGEMENT'S PLAN OF OPERATION AND DISCUSSION AND ANALYSIS.

INTRODUCTORY STATEMENTS

        FORWARD-LOOKING  STATEMENTS AND ASSOCIATED  RISKS.  THIS FILING CONTAINS
FORWARD-LOOKING STATEMENTS,  INCLUDING STATEMENTS REGARDING, AMONG OTHER THINGS,
(A) OUR COMPANY'S PROJECTED SALES AND PROFITABILITY,  (B) OUR COMPANY'S BUSINESS
PLAN AND GROWTH STRATEGIES, (C) OUR COMPANY'S FUTURE FINANCING PLANS AND (D) OUR
COMPANY'S ANTICIPATED NEEDS FOR WORKING CAPITAL. IN ADDITION,  WHEN USED IN THIS
FILING,  THE WORDS "BELIEVES,"  "ANTICIPATES,"  "INTENDS," "IN ANTICIPATION OF,"
"EXPECTS,"   AND  SIMILAR   WORDS  ARE  INTENDED  TO  IDENTIFY   FORWARD-LOOKING
STATEMENTS.  THESE FORWARD-LOOKING STATEMENTS ARE BASED LARGELY ON OUR COMPANY'S
EXPECTATIONS  AND ARE  SUBJECT TO A NUMBER OF RISKS AND  UNCERTAINTIES,  MANY OF
WHICH ARE BEYOND OUR COMPANY'S  CONTROL.  ACTUAL RESULTS COULD DIFFER MATERIALLY
FROM THESE  FORWARD-LOOKING  STATEMENTS  AS A RESULT OF CHANGES IN TRENDS IN THE
ECONOMY  AND  ANY  INDUSTRY  IN  WHICH  THE  COMPANY  ENTERS,  COMPETITION,  THE
AVAILABILITY  OF  FINANCING  AND  OTHER  FACTORS.  IN LIGHT OF THESE  RISKS  AND
UNCERTAINTIES,  THERE CAN BE NO ASSURANCE  THAT THE  FORWARD-LOOKING  STATEMENTS
CONTAINED IN THIS FILING WILL IN FACT OCCUR.

OVERVIEW

         We are a development stage company that has had no operations or income
since our  inception in 1997.  We were  incorporated  in the State of Florida on
July 10, 1997 as August  Project 1 Corp.  We were formed for the sole purpose of
acquiring  or merging  with an  operating  company.  On January 27,  2000,  Lido
Capital  Corporation,  a Florida  corporation  ("LIDO"),  purchased 97.3% of the
then-outstanding  common stock of our company from Eric Littman, our controlling
shareholder at the time. As previously  reported,  in April 2000, we acquired by
merger USWebauctions, Inc. ("USWA"), in which our company adopted the same name.
On July 13, 2000, the acquisition was rescinded.  Since the rescission,  we have
been   active  in  seeking   potential   operating   businesses   and   business
opportunities, with the intent to acquire or merge with such businesses.

         On July 12, 2001, our company  entered into a Stock Purchase  Agreement
with A1 Cellular,  Inc., an operating business. This transaction is subject to a
number  of   contingencies,   including  the  filing  and   effectiveness  of  a
registration  statement to be filed by our company. Prior to the closing of this
transaction,  our company intends to perform a reverse stock split of 1 for 4.84
shares of our  common  stock.  Pursuant  to the Stock  Purchase  Agreement,  our
company will issue 10,800,000,  post-split shares of our common stock for all of
the outstanding  common stock of A1 Cellular,  Inc. Current  shareholders of our
company will own 2,000,000 post-split shares of our company's common stock. This
will represent 15.6% of the then-issued and outstanding  shares of our company's
common stock. Upon the successful consummation of this transaction, A1 Cellular,
Inc.  will be  treated  as the  acquiring  entity for  accounting  purposes  and
USWebauctions  will be the surviving entity for legal purposes.  There can be no
assurance that we will successfully consummate this merger transaction.

         We  have  been  in the  development  stage  since  inception  and  have
undertaken  limited  business  operations to date. As such, to date we have been
considered a "shell"  corporation,  as our principal  purpose has been to locate
and consummate a merger or acquisition  with a private  entity.  We have limited
cash and no other material assets.  We currently do not have a source of revenue
to  cover  operating  costs  to  allow  us  to  continue  as  a  going  concern.
Accordingly,   our  independent  accountants  have  included  in  our  financial
statements a going  concern  qualification  footnote.  Further,  there can be no
assurance  that  we  will  have  the  ability  to  successfully  consummate  the
acquisition  of  A1  Cellular,  Inc.  or  that  upon  the  consummation  of  the
acquisition  of A1  Cellular,  Inc.,  that will be of  material  value to us. In
addition,  in the  event  that we are  unable  to  successfully  consummate  the
acquisition  of A1 Cellular,  Inc.,  there can be no assurance that we will have
the  ability  to  acquire or merge with  another  operating  business,  business
opportunity or property that will be of material value to us.

         Our company  currently  classifies  as a "blank  check"  company.  Many
states  have  enacted  statutes,  rules  and  regulations  limiting  the sale of
securities of "blank check" companies in their respective jurisdictions.

        Any  business  combination  or  transaction  that  we  may  enter  into,
including  the  acquisition  of A1  Cellular,  Inc.,  will  likely  result  in a
significant   issuance  of  stock  and  substantial   dilution  to  our  present
shareholders.   A  business   combination  or  transaction  may  result  in  our
shareholders losing a controlling interest in our company.

        BALANCE SHEET. At June 30, 2001, we had total assets of approximately $0
and had current liabilities of approximately $65,189.

                                       12
<PAGE>

        INCOME STATEMENT. We have not had any revenue since inception.  Our main
operating  expenses  consist  of the  costs  of  complying  with  the  reporting
requirements of the Securities Act of 1933, including legal and accounting fees.
For  the  three  months  and  six  months  ended  June  30,  2001,  we  recorded
approximately $21,749 and $524,514,  respectively, in general and administrative
expenses.  For the three months and six months ended June 30, 2001, our net loss
was approximately $21,749 and $547,847, respectively.

PLAN OF OPERATION

         CASH REQUIREMENTS.  Our cash requirements consist primarily of employee
salaries,  rent, professional fees and related expenses. As of June 30, 2001, we
had no cash-on-hand.  Since inception,  our cash requirements have been met by a
combination of loans from  management and the sale of common stock. In September
2000, our company  raised  approximately  $450,000  (less  offering  expenses of
approximately  $60,000) from the sale of 1,800,000  shares of our company stock.
We will need to raise additional capital to fund our business  operations and to
develop our company's  business  strategy for the next twelve months and beyond.
See "Changes in  Securities  and Use of  Proceeds."  All of these  proceeds were
loaned to Lido Capital  Corporation,  which is owned and  controlled  by Earl T.
Ingarfield,  the president of our company.  The loan to Lido Capital Corporation
was unsecured,  due on demand,  and is to accrue interest at the rate of 10% per
annum. On March 31, 2001, Lido Capital Corporation repaid a portion of this loan
by  tendering  250,000  shares of common  stock to our  company.  The  remaining
portion of the loan was repaid in the form of  consulting  services  provided by
Lido Capital  Corporation in connection  with proposed  merger with A1 Cellular,
Inc.

        Our existing cash resources,  including cash loaned to related  parties,
are anticipated to satisfy our cash  requirements  for twelve (12) months unless
an acquisition is consummated  sooner. In such event,  additional cash resources
may be required to fund the operations of the acquired business.

        Our  company  intends  to  register  these   securities   (approximately
1,800,000  shares of common  stock) and any  additional  securities  sold by our
company  with the  Securities  and  Exchange  Commission  as soon as  reasonably
practicable.  See  "Certain  Business  Risk  Factors - Sales of common  stock by
private placement investors may cause our stock price to decline."

        CHANGES IN NUMBER OF EMPLOYEES. The company does not have any employees.
We are currently  reviewing our personnel  needs for 2001 and beyond.  As of the
date hereof,  we do not  anticipate  hiring any employees  until we consummate a
merger or acquisition with an operating business.

GOING CONCERN OPINION

        Our  independent  auditors have added an explanatory  paragraph to their
audit opinions issued in connection with the 2000 and 1999 financial  statements
which states that our company does not have  significant  cash or other material
assets  to cover its  operating  costs  and to allow it to  continue  as a going
concern.  Our ability to obtain additional funding will determine our ability to
continue  as a going  concern.  Our  financial  statements  do not  include  any
adjustments that might result from the outcome of this uncertainty.

CERTAIN BUSINESS RISK FACTORS

        We are  subject to  various  risks,  which may have a  material  adverse
effect on our company's business, financial condition and results of operations.
Certain risks are discussed below:

        WE HAVE NO  OPERATING  HISTORY OR REVENUE  FROM  WHICH TO  EVALUATE  OUR
        BUSINESS

        We have had no operating  history or revenue from  operations  since our
inception on July 10, 1997.  In addition,  we have limited  assets and financial
resources.  Due to our  lack of  operations  and  revenue,  we  expect  to incur
operating  losses for the  foreseeable  future.  Due to our lack of  operations,
there is limited information upon which investors can evaluate our business. Our
independent  auditors have noted that our company does not have significant cash
or a source of revenue to cover our operating  costs and to allow us to continue
as a going  concern.  External  capital will be required for us to continue as a
going concern.  We have no commitments or other sources of capital  available to


                                       13
<PAGE>

us. Our  inability to continue as a going  concern  could result in a decline of
our stock price, and you could lose money.

        BECAUSE WE HAVE NO  OPERATIONS  OUR FUTURE  BUSINESS  OPPORTUNITIES  ARE
        HIGHLY SPECULATIVE

        The success of our proposed plan of operation  will be highly  dependent
on any business operations of A1 Cellular,  Inc., a company which itself has had
limited operations to date. There can be no assurance that we will be successful
in  consummating  the  acquisition of A1 Cellular,  Inc. You should consider the
likelihood of our future success to be highly speculative in view of our lack of
operating history, as well as the limited operating history of A1 Cellular, Inc.
Our inability to acquire A1 Cellualr,  Inc. or another  operating  business in a
timely manner or at all could cause a decline in our stock price.

        WE MAY  NOT BE  ABLE  TO  IDENTIFY  A  BUSINESS  OPPORTUNITY  DUE TO THE
        SCARCITY OF AND COMPETITION FOR SUCH BUSINESS OPPORTUNITIES

        In  the  event  that  we  are  unable  to  successfully  consummate  the
acquisition  of A1  Cellular,  Inc.,  we will need to  identify  an  alternative
operating  business,  business  opportunity  or  property.  A  large  number  of
established and  well-financed  entities,  including  venture capital firms, are
active in mergers and  acquisitions  of a  relatively  small  number of suitable
business opportunities.  Nearly all of these entities have significantly greater
financial resources,  technical expertise and managerial capabilities than we do
and,  consequently,  we will be at a  competitive  disadvantage  in  identifying
possible  business   opportunities   and  successfully   completing  a  business
combination  in the event  that we are  unable to  successfully  consummate  the
acquisition of A1 Cellular,  Inc.  Additional  competition for suitable business
opportunities comes from other public "shell" companies, similar to our company.
In the event that we are unable to successfully consummate the acquisition of A1
Cellular,   Inc.,  our  inability  to  identify  and  combine  with  a  suitable
alternative  business  opportunity could cause a decline in our stock price, and
you could lose money.

        OUR  MANAGEMENT  IS EXPECTED  TO EXERT  SIGNIFICANT  INFLUENCE  OVER THE
        DIRECTION OF OUR COMPANY AND WILL DEVOTE A LIMITED AMOUNT OF TIME TO THE
        PRESENT BUSINESS OF THE COMPANY

        Through  their  stock  ownership,  management  will  be  able  to  exert
significant  influence  over  the  direction  of our  company  and our  business
opportunities.  None of our  officers  has  entered  into a  written  employment
agreement with our company,  and none is expected to do so in the future.  We do
not maintain any key man life insurance.  Management is expected to devote about
ten  hours per month to the  present  business  of our  company.  Despite  these
factors,  the loss of the services of these  individuals,  particularly  Earl T.
Ingarfield,  will  jeopardize  our ability to consummate  the  acquisition of A1
Cellular,  Inc. and jeopardize our ability to continue operations.  In the event
that we are unable to  successfully  consummate the  acquisition of A1 Cellular,
Inc.,  management's  ability to identify a suitable business opportunity will be
limited. Any of these outcomes would likely cause our stock price to decline.

        MANAGEMENT MAY  PARTICIPATE IN BUSINESS  DEALINGS WHICH COMPETE WITH OUR
        COMPANY

        Management  may in the future  participate  in business  dealings  which
compete with the  operations  of our company.  This may include the formation of
other  public  "shell"  companies,  in which event,  management  will be able to
choose which public  "shell"  company should acquire or merge with an identified
business opportunity. If our company successfully consummates the acquisition of
A1  Cellular,  Inc. or acquires or merges with any other  business  opportunity,
then  management may have or develop other business  dealings which compete with
the operations of A1 Cellular,  Inc. or any other business  opportunity that may
merge  with our  company.  This may make it more  difficult  for our  company to
successfully  consummate the acquisition of A1 Cellular,  Inc. or identify other


                                       14
<PAGE>

business  opportunities  or  materially  harm the  operations  of such  business
opportunities. These events, if realized, may cause our stock price to decline.

        HOLDERS  OF OUR  STOCK  SHOULD  EXPECT  A  CHANGE  IN  CONTROL  UPON THE
        CONSUMMATION OF THE ACQUISITION OF A1 CELLULAR, INC.

        If we are able to consummate the  acquisition  of A1 Cellular,  Inc., we
expect to issue shares of stock to the  shareholders  of A1 Cellular,  Inc. This
stock issuance will result in the shareholders of A1 Cellular,  Inc. obtaining a
controlling interest in our company. The acquisition of A1 Cellular, Inc. by our
company will require our  management to resign as officers and  directors.  This
change of control after the  successful  consummation  of the  acquisition of A1
Cellular,  Inc. would preclude current management's  participation in the future
affairs of our company.

        HOLDERS  OF  OUR  STOCK  WILL  BE  DILUTED  UPON   CONSUMMATION  OF  THE
        ACQUISITION OF A1 CELLULAR, INC. OR OTHER BUSINESS COMBINATION, IF ANY

         Upon  consummation  of the  acquisition  of A1 Cellular,  Inc. or other
business  combination,  if any, we expect to issue new stock to the shareholders
of the target business.  Prior to the closing of the acquisition of A1 Cellular,
Inc., our company  intends to perform a reverse stock split of 1 for 4.84 shares
of common stock.  Pursuant to the agreement with A1 Cellular,  Inc., our company
will  issue  10,800,000  post-split  shares of our  common  stock for all of the
outstanding  common  stock of A1  Cellular,  Inc.  Current  shareholders  of our
company will own 2,000,000 post-split shares of our company's common stock. This
will represent 15.6% of the then-issued and outstanding  shares of our Company's
common  stock.  Accordingly,  if the price of our stock does not  increase  by a
corresponding amount, the value of the shareholders stock may decline.

        THERE ARE DISADVANTAGES OF A BLANK CHECK OFFERING

        We may enter into a business  combination,  including the acquisition of
A1 Cellular,  Inc.,  with an entity that  desires to establish a public  trading
market for its stock. A business  opportunity may attempt to avoid what it deems
to be adverse  consequences  of undertaking its own public offering by seeking a
business  combination  with us.  Such  consequences  include  time delays of the
registration process,  significant expenses incurred in such undertaking or loss
of voting control to public shareholders.  You should consider these motivations
in determining whether to become a shareholder in our company.

        WE MAY BE SUBJECT TO THE  INVESTMENT  COMPANY  ACT OF 1940,  WHICH WOULD
        RESULT IN SIGNIFICANT REGISTRATION AND COMPLIANCE COSTS

        We do not  believe  that our company  will be subject to the  Investment
Company Act of 1940  because we will not be engaged in the business of investing
or trading in securities.  If we engage in business combinations in which we end
up holding  passive  investment  interests in a number of entities,  we could be
subject to regulation  under the Investment  Company Act of 1940. In such event,
we would be required to register as an investment  company and could be expected
to incur significant registration and compliance costs.

        SALE OF COMMON STOCK BY PRIVATE PLACEMENT  INVESTORS MAY CAUSE OUR STOCK
        PRICE TO DECLINE

        We  intend  to  file a  registration  statement  on  behalf  of  certain
shareholders  with the Securities and Exchange  Commission as soon as reasonably
practicable  after the consummation of the acquisition of A1 Cellular,  Inc., or
in the event that we are unable to successfully consummate the acquisition of A1
Cellular,  Inc.,  after the  consummation  of a transaction  with an alternative
operating company. This registration  statement will permit such shareholders to
freely  sell  their  shares of common  stock  into the open  market.  Such sales
without corresponding demand may cause our stock price to decline.

        OUR COMMON STOCK MAY BE DEEMED TO BE "PENNY STOCK"

        Our  common  stock may be  deemed  to be  "penny  stock" as that term is
defined in Rule 3a51-1  promulgated  under the Securities  Exchange Act of 1934.
Penny stocks are stock:

        o   With a price of less than $5.00 per share;

                                       15
<PAGE>

        o   That are not traded on a "recognized" national exchange;

        o   Whose prices are not quoted on the Nasdaq automated quotation system
            (Nasdaq  listed stock must still have a price of not less than $5.00
            per share); or

        o   In issuers with net  tangible  assets less than $2.0 million (if the
            issuer has been in continuous operation for at least three years) or
            $5.0 million (if in continuous operation for less than three years),
            or with  average  revenues  of less than $6.0  million  for the last
            three years.

        Broker/dealers dealing in penny stocks are required to provide potential
investors  with a  document  disclosing  the  risks of penny  stocks.  Moreover,
broker/dealers  are required to determine whether an investment in a penny stock
is a suitable  investment for a prospective  investor.  These  requirements  may
reduce  the  potential  market for our common  stock by  reducing  the number of
potential investors. This may make it more difficult for investors in our common
stock to resell  shares to third parties or to otherwise  dispose of them.  This
could cause our stock price to decline.























                                       16
<PAGE>

PART II

OTHER INFORMATION.

ITEM 1. LEGAL PROCEEDINGS.

        We are not aware of any legal proceedings involving our company.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.

        (a), (b) and (d)     None.

        (c)    SALES OF UNREGISTERED SECURITIES.

         On April 1, 2001,  our company issued 70,900 shares of our common stock
at a price of $0.25 per share for services.

        With respect to the sale of unregistered  securities  referenced  above,
these transactions were exempt from registration pursuant to Section 4(2) of the
Securities  Act of  1933,  and  Regulation  D  promulgated  thereunder.  In each
instance,  the  purchaser  had access to  sufficient  information  regarding our
company so as to make an informed investment decision.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

        Not applicable.

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

        Not applicable.

ITEM 5. OTHER INFORMATION.

        Not applicable.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

(a)            EXHIBITS.

<TABLE>
  EXHIBIT
    NO.       DESCRIPTION                                      LOCATION
    ---       -----------                                      --------
<S>           <C>                                              <C>
    2.01      Stock Purchase Agreement dated as of January     Incorporated by reference to Exhibit 2.01 to our
              27, 2000 among our company, Lido Capital         company's Registration Statement on Form 10-SB
              Corporation, Eric P. Littman and Dennis Sturm    filed with the Securities and Exchange Commission
                                                               on February 24, 2000.

    2.02      Stock Purchase Agreement dated as of April 10,   Incorporated by reference to Exhibit 2.02 to our
              2000, among our company, USWEBAUCTIONS, Inc.,    company's Current Report on Form 8-K filed with
              Jon Kochevar, and John Allen                     the Securities and Exchange Commission on May 26,
                                                               2000.



                                       17
<PAGE>

  EXHIBIT
    NO.       DESCRIPTION                                      LOCATION
    ---       -----------                                      --------

    2.03      Articles of Merger dated as of April 21, 2000    Incorporated by reference to Exhibit 2.03 to our
              of USWEBAUCTIONS, Inc. into our company,         company's quarterly report on Form 10-QSB filed
              together with the Plan of Merger                 with the Securities and Exchange Commission on
                                                               August 21, 2000.

    2.04      Rescission Agreement and Mutual Release dated    Incorporated by reference to Exhibit 2.01 to our
              as of July 13, 2000 among our company, Jon       company's Current Report on Form 8-K filed with
              Kochevar, and John Allen                         the Securities and Exchange Commission.

    3.01      Articles of Incorporation filed on July 10,      Incorporated by reference to Exhibit 3.01 to our
              1997 with the Florida Secretary of State         company's Registration Statement on Form 10-SB
                                                               filed with the Securities and Exchange Commission
                                                               on February 24, 2000.

    3.02      Articles of Amendment to Articles of             Incorporated by reference to Exhibit 3.02 to our
              Incorporation                                    company's Registration Statement on Form 10-SB
                                                               filed with the Securities and Exchange Commission
                                                               on February 24, 2000.

    3.03      Bylaws                                           Incorporated by reference to Exhibit 3.03 to our
                                                               company's Registration Statement on Form 10-SB
                                                               filed with the Securities and Exchange Commission
                                                               on February 24, 2000.

    4.01      Instruments defining the rights of holders,      Not applicable.
              incl. indentures

   10.01      Stock Purchase Agreement, dated July 12, 2001    Provided herewith.
              between our company, A1 Cellular, Inc., Earl
              T. Ingarfield, David Gooden and Beverly I.
              Gooden

   11.01      Statement re: Computation of Earnings            Not Applicable.

   15.01      Letter on Unaudited Interim Financial            Not Applicable.
              Information

   16.01      Letter on Change in Certifying Accountant        Not Applicable.

   18.01      Letter on Change in Accounting Principles        Not Applicable.

   21.01      Subsidiaries of our company                      Not Applicable.

   23.01      Consent of Independent Accountants               Not Applicable.

   24.01      Power of Attorney                                Not Applicable.

   27.01      Financial Data Schedule                          Not Applicable.
</TABLE>


(b)     REPORTS ON FORM 8-K.

        No reports on Form 8-K were filed  during  the  quarterly  period  ended
June 30, 2001.




                                       18
<PAGE>

                                   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.

Date:   August 20, 2001                USWEBAUCTIONS, INC.


                                       By: /s/ Earl T. Ingarfield
                                           -------------------------------------
                                               Earl T. Ingarfield, President





















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