U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
X Quarterly report under section 13 or 15(d) of the Securities Exchange Act
- ---
of 1934 for the quarterly period ended June 30, 2000.
Transaction report under section 13 or 15(d) of the Securities Exchange Act
- ---
of 1934 for the transition period from ________ to __________.
Commission File No.: 0-30851
DIGITAL VILLAGE WORLD TECHNOLOGIES, INC.
(Name of small business in its charter)
Nevada 88-0404114
(State or other Jurisdiction of Incorporation) (IRS Employer Id. No.)
Unit 10, 8980 Fraserwood Court
Burnaby, British Columbia
Canada V5J 5H7
(Address of Principal Office) (Zip Code)
Issuer's telephone number: (604) 438-3598
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days. Yes
X No
- --- ---
Applicable only to issuers involved in bankruptcy proceedings during the past
five years.
Check whether the issuer has filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes _______ No _______
Applicable only to corporate issuers.
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. At June 30, 2000, 4,375,000 $0.001
par value common shares outstanding.
Transitional Small Business Disclosure Format (Check one):
Yes _______ No _______
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS AND EXHIBITS
The unaudited financial statements of registrant for the three month and six
month periods ended June 30, 2000, and June 30, 1999. The financial statements
reflect all adjustments which are, in the opinion of management, necessary to a
fair statement of the results for the interim periods presented.
MOEN AND COMPANY
CHARTERED ACCOUNTANTS
PO Box 10129
1400 IBM Tower Telephone: (604)662-8899
701 West Georgia Street Fax: (604)662-8809
Vancouver, BC V7Y 1C6
- --------------------------------------------------------------------------------
INDEPENDENT ACCOUNTANTS' REVIEW REPORT
--------------------------------------
To the Directors and Shareholders of
Digital Village World Technologies, Inc. (formerly Body Concepts, Corp.)
(A Nevada Corporation)
(A Development Stage Company)
We have reviewed the accompanying Balance Sheets of Digital Village World
Technologies, Inc. (formerly Body Concepts, Corp.) (A Nevada Corporation) (A
Development Stage Company) as of June 30, 2000, and the Statements of
Operations, Cash Flows and Changes in Stockholders' Equity for the six month
period then ended. These financial statements are the responsibility of the
Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the accompanying financial statements for them to be in conformity
with United States generally accepted accounting principles (GAAP).
"Moen and Company"
Chartered Accountants
Vancouver, British Columbia, Canada
January 9, 2001
DIGITAL VILLAGE WORLD TECHNOLOGIES, INC.
(FORMERLY BODY CONCEPTS, INC.)
(A Nevada Corporation)
(A Development Stage Company)
Balance Sheets
June 30, 2000 and 1999
(In US Dollars)
(Unaudited)
2000 1999
--------- --------
Assets
Current Assets
Cash and cash equivalents (note 2) $ 43,102 65,835
========= ========
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable and accrued $ 550 --
--------- --------
Stockholders' Equity
Capital stock (note 3)
Authorized
62,500,000 common shares at $0.0004 par value
Issued
4,375,000 common shares 1,750 1,750
Additional paid in capital 75,750 75,750
--------- --------
77,500 77,500
Deficit, accumulated during the development stage (34,948) (11,665)
--------- --------
42,552 65,835
--------- --------
$ 43,102 65,835
========= ========
Approved on behalf of the board:
"Richard Wang" , Director
- ----------------
"Edward Chen" , Director
- ----------------
DIGITAL VILLAGE WORLD TECHNOLOGIES, INC.
(FORMERLY BODY CONCEPTS, INC.)
(A Nevada Corporation)
(A Development Stage Company)
Statements of Operations
(In US Dollars)
(Unaudited)
Cumulative From
Inception Date
on Sep. 15, 1998 Quarter Ended Six Months Ended
to June 30, June 30, June 30,
------------------------- ----------------------------
2000 2000 1999 2000 1999
------------- ------------ ---------- ---------- ------------
Revenue
Interest and other income $ 2,650 $ 753 $ -- $ 1,508 $ --
------------- ------------ ---------- ---------- ------------
Administration Costs
Advertising and promotion 712 -- 224 -- 224
Accounting 2,116 -- -- 550 321
Bank charges and interest 370 102 14 135 86
Consulting 25,305 20,000 -- 20,000 5,000
Courier 18 -- -- -- --
Legal 4,500 2,000 -- 2,000 2,500
License, dues and insurance 720 -- 100 -- 200
Office costs 300 -- -- -- --
Rental and leases 2,221 (200) 1,536 300 1,836
Transfer agency and filing fees 1,336 (60) 140 200 761
------------- ------------ ---------- ---------- ------------
37,598 21,842 2,014 23,185 10,928
------------- ------------ ---------- ---------- ------------
Loss for the period $ 34,948 $ 21,089 $ 2,014 $ 21,677 10,928
============= ============ ========== ========== ============
Basic loss per share $ (0.00) $ (0.00) $ (0.00) (0.00)
============ ========== ========== ============
Diluted loss per share $ (0.00) $ (0.00) $ (0.00) (0.00)
============ ========== ========== ============
Weighted average number of
common shares used to
compute basic and fully
diluted loss per share 4,375,000 4,375,000 4,375,000 4,375,000
============ ========== ========== ============
See Accompanying Notes and Independent Accountants' Review Report
(A Nevada Corporation)
(A Development Stage Company)
Consolidated Statement of Cash Flows
(In US Dollars)
(Unaudited)
Cumulative From
Inception Date
on Sep. 15, 1998 Quarter Ended Six Months Ended
to June 30, June 30, June 30,
----------------------------- -----------------------------
2000 2000 1999 2000 1999
--------------- --------------- ------------ -------------- -------------
Cash derived from (used for)
Operating activities
Loss for the period $ (34,948) $ (21,089) $ (2,014) $ (21,677) $ (10,928)
Changes in non-cash
working capital items
Accounts payable and accrued 550 (344) -- 550 --
--------------- --------------- ------------ -------------- -------------
(34,398) (21,433) (2,014) (21,127) (10,928)
--------------- --------------- ------------ -------------- -------------
Financing activities
Issuance of shares for cash 77,500 -- -- -- --
--------------- --------------- ------------ -------------- -------------
Cash, increase (decrease)
during the period 43,102 (21,433) (2,014) (21,127) (10,928)
Cash, beginning of period 64,535 67,849 64,229 76,763
--------------- --------------- ------------ -------------- -------------
Cash, end of period $ 43,102 $ 43,102 $ 65,835 $ 43,102 $ 65,835
=============== =============== ============ ============== =============
DIGITAL VILLAGE WORLD TECHNOLOGIES, INC.
(FORMERLY BODY CONCEPTS, INC.)
(A Nevada Corporation)
(A Development Stage Company)
Statement of Changes in Stockholders' Equity
From Date of Inception on September 15, 1998 to June 30, 2000
(In U.S. Dollars)
(Unaudited)
Deficit Accum-
Number of Additional Total ulated During Total
Common par Paid-in Capital The Develop- Cumulative Stockholders'
Shares Value Capital Stock ment Stage ranslation Equity
---------------------------------------------------------------------------------
9/15/98 issuance of common
stock for cash 1,000,000 $1,000 $ 1,500 $ 2,500 $ 2,500
12/31/98 issuance of common
stock for cash 750,000 750 74,250 75,000 75,000
Net loss for the year ended December 31, 1998 (737) (737)
-------------------------------------------------------------------------------
Balance, December 31, 1998 1,750,000 1,750 75,750 77,500 (737) 76,763
Net loss for the year ended December 31, 1999 (12,534) (12,534)
-------------------------------------------------------------------------------
Balance, December 31, 1999 1,750,000 1,750 75,750 77,500 (13,271) 64,229
Balance, May 19, 2000
before forward split 1,750,000 1,750 75,750 77,500 (13,271) 64,229
===============================================================================
05/19/00 2.5 to 1 forward split 4,375,000 1,750 75,750 77,500 (13,271) 64,229
Net loss six months ended June 30, 2000 (21,677) (21,677)
-------------------------------------------------------------------------------
Balance, June 30, 2000 4,375,000 $1,750 $75,750 $ 77,500 $(34,948) $ 42,552
===============================================================================
See Accompanying Notes and Independent Accountants' Review Report
Note 1. ORGANIZATION AND NATURE OF BUSINESS
The Company was incorporated under the laws of the State of Nevada on September
15, 1998, as Body Concepts, Inc. On May 25, 2000 the Company changed its name
from Body Concepts, Inc. to Digital Village World Technologies, Inc.
On May 19, 2000 the Company increased its authorized capital stock from
25,000,000 common shares with a par value of $0.001 to 62,500,000 common shares
with a par value of $0.0004.
On May 19, 2000 the Company completed a 2.5:1 forward split of its outstanding
stock. This forward split increased the number of issued and outstanding shares
from 1,750,000 common shares to 4,375,000 common shares.
The Company has offices in Burnaby, British Columbia, Canada.
Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
These financial statements have been prepared in accordance with Accounting
Principles Generally Accepted in the United States ("USGAAP).
Development Stage Company
The accompanying financial statements have been prepared in accordance with the
provisions of Statement of Financial Accounting Standard No. 7, "Accounting and
Reporting by Development Stage Enterprises".
Use of Estimates
The preparation of financial statements in conformity with USGAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the dates of the financial statements and the reported amounts of revenues and
expenses during the reporting periods. Actual results could differ from those
estimates.
Cash and Cash Equivalents
Cash and cash equivalents consist of cash on deposit and highly liquid short-
term interest bearing securities with a maturity at the date of purchase of
three months or less.
Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
Income Taxes
Provisions for income taxes are based on taxes payable or refundable for the
current year and deferred taxes on temporary differences between the amount of
taxable income and pretax financial income and between the tax bases of assets
and liabilities and their reported amounts in the financial statements.
Deferred tax assets and liabilities are included in the financial statement at
currently enacted income tax rates applicable to the period in which the
deferred tax assets and liabilities are expected to be realized or settled as
prescribed in FASB Statement No. 109, Accounting for Income Taxes. As changes
in tax laws or rate are enacted, deferred tax assets and liabilities are
adjusted through the provision for income taxes.
Compensated Absences
Employees of the corporation are entitled to paid vacations, sick days and other
time off depending on job classification, length of service and other factors.
It is impractical to estimate the amount of compensation
for future absences, and accordingly, no liability has been recorded in the
accompanying financial statements. The corporation's policy is to recognize the
costs of compensated absences when paid to employees.
Net Loss Per Share
The Company adopted Statement of Financial Accounting Standards No. 128 that
requires the reporting of both basic and diluted earnings per share. Basic
earnings per share is computed by dividing net income available to common
shareowners by the weighted average number of common shares outstanding for the
period. Diluted earnings per share reflects the potential dilution that could
occur if securities or other contacts to issue common stock were exercised or
converted into common stock. In accordance with FASB 128, any anti-dilution
effects on net loss per share are excluded.
Disclosure About Fair Value of Financial Instruments
The Company has financial instruments, none of which are held for trading
purposes. The Company estimates that the fair value of all financial instruments
at June 30, 2000 as defined in FASB 107, does not differ materially from the
aggregate carrying values of its financial instruments recorded in the
accompanying balance sheet. The estimated fair value amounts have been
determined by the Company using available market information and appropriate
valuation methodologies. Considerable judgment is required in interpreting
market data to develop the estimates of fair value, and accordingly, the
estimates are not necessarily indicative of the amounts that the Company could
realize in a current market exchange.
Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
Concentration of Credit Risk
Financial instruments that potentially subject the Company to a significant
concentration of credit risk consist primarily of cash and cash equivalents
which are not collateralized. The Company limits its exposure to credit loss by
placing its cash and cash equivalents with high credit quality financial
institutions.
Note 3. CAPITAL STOCK
a) Authorized: 62,500,000 common shares with a par value of $0.0004.
b) Issued and outstanding as at June 30, 2000 are as follows:
Additional
Issued Number of Share Paid-in
Date Shares Capital Capital Total
----------- ------------ ----------- ------------ -----------
private placement 15/09/1998 1,000,000 $ 1,000 $ 1,500 $ 2,500
private placement 12/31/1998 750,000 750 74,250 75,000
--------- --------- --------- ---------
Balance 12/31/1998 1,750,000 1,750 75,750 77,500
--------- --------- --------- ---------
Balance 12/31/1999 1,750,000 1,750 75,750 77,500
--------- --------- --------- ---------
Balance, before
forward split 5/19/2000 1,750,000 $ 1,750 $ 75,750 $ 77,500
========= ========= ========= =========
2.5:1 forward split 5/19/2000 4,375,000 $ 1,750 $ 75,750 $ 77,500
========= ========= ========= =========
Balance 6/30/2000 4,375,000 $ 1,750 $ 75,750 $ 77,500
========= ========= ========= =========
Note 4. INCOME TAXES
a) The most recent Federal Income Tax filing for the Company for the US
was for the year ended December 31, 1999, disclosing no income taxes
payable to the US Internal Revenue Service.
b) There is a loss of $34,948 carried forward that may be applied
towards future profits.
No deferred income taxes are recorded as an asset. A reserve has been
claimed that offsets the amount of tax credit available from use of the
loss carry forward because there is presently no indication that these
tax losses will be utilized.
Note 5. FINANCIAL INSTUMENTS
The Company's financial instruments consist of cash and cash equivalent and
accounts payable and accrued. It is management's opinion that the Company is not
exposed to significant interest, currency or credit risks arising from these
financial instruments. The fair value of these financial statements approximated
their carrying values.
Note 6. PENSION AND EMPLOYMENT LIABILITIES
The Company does not have liabilities as at June 30, 2000, for pension,
post-employment benefits or post-retirement benefits. The Company does not have
a pension plan.
Note 7. UNAUDITED FINANCIAL INFORMATION
The accompanying financial information as of June 30, 2000 is unaudited. These
financial statements include all of the adjustments which, in the opinion of
management, are necessary to fair presentation of the Company's financial
position and results of operations. All such adjustments are of a normal and
recurring
nature. These financial statements should be read in conjunction with the
Company's audited financial statements at December 31, 1999.
Note 8. SUBSEQUENT EVENTS
The Company filed Form 8-K on December 18, 2000, which included the following:
a) Changes in control of Registrant
Digital Village World Technologies, Inc. (the "Registrant") entered
into a share exchange agreement, dated as of December 18, 2000 (the
"Share Exchange Agreement") by and among, the Registrant, Digital
Village World Technologies (Canada) Ltd. ("DVC"), Tianjin Teda Yu
Cheung Group Co. Ltd. (the "Founding Shareholder") and the
shareholders of DVC named therein (the "DVC Shareholders", together
with the Founding Shareholder, the "Shareholders"). Pursuant to the
share Exchange Agreement, on December 18, 2000 (the "Closing"), the
Registrant acquired from the shareholders all of the shares of DVC
(the "Acquisition") in exchange for eight million four hundred and
ninety thousand (8,490,000) shares of the Registrant's common stock
representing 65.77% of the issued and outstanding shares of the
Registrant after giving effect to the Acquisition.
On the Closing Mr. Howard Gelfant and Mr. James Wosk resigned from the
board of directors. Pursuant to the terms of the Share Exchange
Agreement, Mr. Stephen Dadson and Mr. Mu Zhankui became members of the
board of directors of the Registrant. The directors then elected Mr.
Stephen Dadson as the Chief Executive Officer.
The following table sets forth certain information after giving effect
to the issuance of the securities at the Closing with respect to the
beneficial ownership of the outstanding shares of common stock by the
Registrant's directors, executive officers and each person known to the
Registrant who owns in excess of 5% of the outstanding shares of common
stock and the directors and executive officers of the Registrant as a
group.
Each person listed below has personal and sole beneficial ownership of
the shares of common stock listed with their name:
Total Number Percentage
Name Of Shares Ownership
----------------------------------------------------------------------------------------------------------
Tianjin Teda Yu Cheung Group Co. Ltd. 6,000,000 46.6%
Richard Wang 1,000,000 7.8%
Peng Chen 1,000,000 7.8%
Brian Roberts 250,000 1.9%
Zun Zhao Li 1,000,000 7.7%
Karen Dadson 1,000,000 7.7%
Mu Zhankui 500,000 3.9%
All Directors and Executive Officers (4 persons) 2,750,000 13.7%
b) Acquisition or Disposition of Assets.
The information set forth above under "(a) above, Change in Control of
Registrant" is incorporated herein by reference.
As described in (a) above, pursuant to the Share Exchange Agreement,
the Registrant acquired all of the issued and outstanding stock of
DVC. In consideration therefor, the Registrant issued to the
Shareholders eight million four hundred and ninety thousand
(8,490,000) shares of the Registrant's common stock. The consideration
for the acquisition of DVC was negotiated on an arms length basis.
DVC is a Canadian company incorporated in the Province of British
Columbia. DVC is an internet content provider that provides bi-lingual
content and technical services to companies in China, and provides
third party internet services such as web design, web hosting and
content development for firms that specialize in naturopathic and
traditional eastern health sciences in North America.
c) Changes in Registrant's Certifying Accountant
(i) On December 28, 2000 the Company advised Parker and Co. that it
would not be appointed as the Company's auditors for the year
ended December 31, 2000.
(ii) During either of the past two fiscal years, and any subsequent
interim period, Parker and Co. reports on the Company's financial
statements have not contained adverse opinions or disclaimers of
opinion. During either of the past two fiscal years, and any
subsequent interim period, there have not been any disagreements
between Parker and Co. and the Company on any matter of accounting
principles or practices, financial statement disclosure, or
auditing scope or procedure or any reportable events between
Parker and Co. and the Company.
(iii) The Company requested Parker and Co. to furnish it with a letter
addressed to the Securities and Exchange Commission stating
whether or not it agrees with the statements made by the Company
in response to this section and, if not, stating the respects in
which it does not agree. The Company delivered a copy of the Form
report to Parker and Co. on December 28, 2000. The Company will
file such letter as an amendment to the Form,
(iv) On December 28, 2000, the Board of Directors of the Company
appointed Moen and Company as independent auditors of the Company
for the fiscal year ended December 31, 2000. Prior to the
engagement of Moen and Company, neither the Company nor anyone on
its behalf consulted with such firm regarding the application of
accounting principles to a specified transaction whether completed
or uncompleted, or type of audit opinion that might be rendered on
the Company's financial statements.
d) Other Events.
(i) Registrant has moved its principal executive offices from 4750
Table Mesa Drive, Boulder, Colorado, 80303 to 8980 Fraserwood
Court, Unit 10, Burnaby B.C., Canada, T5J 5HJ.
(ii) The Registrant adopted a new trading symbol of "DVWT"
(iii) The Registrant's new CUSIP number is 25388R109
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The following discussion should be read in conjunction with the accompanying
financial statements for the three-month periods ended June 30, 2000 and 1999;
the six month periods ended June 30, 2000 and 1999, and the Form 10-SB filed by
the Company on June 21, 2000. Special Note Regarding Forward-Looking Statements:
Certain statements in this report and elsewhere (such as in other filings by the
Company with the Securities and Exchange Commission ("SEC"), press releases,
presentations by the Company or its management and oral statements) may
constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Words such as "expects,"
"anticipates," "intends," "plans," "believes," "seeks," "estimates," and
"should," and variations of these words and similar expressions, are intended to
identify these forward-looking statements. The Company undertakes no obligation
to publicly release the result of any revisions to these forward-looking
statements, which may be made to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events.
Results of operations - comparison of the three month periods ended June 30,
2000 and June 30, 1999.
Revenue for the quarter continued to be solely interest earned on deposited
funds and was $753 versus nil in 1999. Expenses during the quarter were $21,842
versus $2,014 in the corresponding quarter in 1999. As a result, for the quarter
ended June 30, 2000, the Company had a net loss of $21,089, as compared to a
loss of $2,014 for the same quarter of 1999.
The Company continues to seek business opportunities and is still developing its
business plan which is expected to be finalized during the fourth quarter of
2000.
The cash balance at the end of the period was $43,102 compared to $65,835 in
1999. This reduction was primarily due to consulting fees in respect to
development of a corporate Business Plan and operating expenses.
Net cash used during the current three month period was $21,433 compared to
$2,014 during the same period of the prior year. The Company continues to be
reliant on cash available in order to fund its limited operations. There can be
no assurance that additional financing, if required, will be available to the
Company in amounts or on terms that are acceptable.
Results of operations - comparison of the six month periods ended June 30, 2000
and June 30, 1999.
Revenue for the six month period ended June 30, 2000 was generated solely from
interest earned on deposited funds and was $1,508 as compared to nil in the same
period of 1999. Expenses during the six month period were $23,185 as compared to
expenses of $10,928
in the same period of 1999. The principal variations were in areas of consulting
fees in respect to development of a corporate Business Plan.
Net cash used during the six month period was $21,127 compared to $10,928 during
the same period of the prior year.
Plan of Operations
For the fiscal year ending December 31, 2000, and for the succeeding twelve
months, the Company expects to continue its efforts to locate a suitable
business acquisition candidate and thereafter to complete a business acquisition
transaction. The Company anticipates incurring a loss for the fiscal year as a
result of expenses associated with compliance with the reporting requirements of
the Securities Exchange Act of 1934, and expenses associated with locating and
evaluating acquisition candidates. The Company does not expect to generate
revenues until it completes a business acquisition, and, depending upon the
performance of the acquired business, it may also continue to operate at a loss
after completion of a business combination.
Need for Additional Financing
The Company believes it may require additional capital in order to pay the costs
associated with carrying out its plan of operations and the costs of compliance
with its continuing reporting obligations under the Securities Exchange Act of
1934, as amended, for the fiscal year ending December 31, 2000 and for the
succeeding twelve months. This additional capital may be required whether or not
the Company is able to complete a business combination transaction during the
current fiscal year. Furthermore, once a business combination is completed, the
Company's needs for additional financing are likely to increase substantially.
No specific commitments to provide additional funds have been made by management
or other stockholders, and the Company has no current plans, proposals,
arrangements or understandings to raise additional capital through the sale or
issuance of additional securities prior to the location of a merger or
acquisition candidate. Accordingly, there can be no assurance that any
additional funds which may be required will be available to the Company to allow
it to cover its expenses.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) The Exhibits listed below are filed as part of this filing:
27.1 - Financial Data Schedule
(b) No reports on Form 8-K were filed by the Company for the quarter
ended June 30, 2000.
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.
DIGITAL VILLAGE WORLD TECHNOLOGIES INC.
By:/S/ RICHARD WANG
Richard Wang, President
Date: January 18, 2001
By:/S/ PENG CHEN
Peng Chen, Director
Date: January 18, 2001