UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D. C. 20549
FORM 10-QSB
(X) Quarterly report pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934.
For the quarterly period ended June 30, 2003.
( ) Transition report pursuant to Section 13 or 15(d) of the Exchange
Act for the transition period from _________ to _________.
Commission File Number: 0-32477
AVIC TECHNOLOGIES LTD.
(Exact name of registrant as specified in charter)
DELAWARE 98-0212726
-------- ----------
(State of or other jurisdiction of (IRS Employer I.D. No.)
incorporation or organization)
445 St. Francois Xavier St.
Montreal, Quebec, Canada
(Address of Principal Executive Offices)
(514) 844-3510
(Registrant's Telephone Number, Including Area Code)
Check whether the registrant: (1) has filed all reports required to be filed by
Section 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 ( )
Indicate the number of shares outstanding of each of the issuer's classes of
stock as of July 30, 2003.
19,721,000 Common Shares
Transitional Small Business Disclosure Format:
YES ( ) NO (x)
AVIC TECHNOLOGIES LTD.
(A Development Stage Enterprise)
INDEX TO FORM 10-QSB
Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)
Balance Sheets as of June 30, 2003 and December 31, 2002 3
Statements of Operations for the three and six months
ended June 30, 2003 and 2002, and the period March 4,
1999 (date of incorporation) to June 30, 2003
4
Statement of Stockholders' Deficit for the six months ended June 30, 2003
5
Statements of Cash Flows for the three and six months
ended June 30, 2003 and 2002, and the period March 4,
1999 (date of incorporation) to June 30, 2003
6
Notes to Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial Condition and Results of
Operations (including cautionary statement) 11
Item 3. Controls and Procedures 12
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 12
Item 2. Changes in Securities 12
Item 3. Defaults Upon Senior Securities 13
Item 4. Submission of Matters to a Vote of Securities Holders 13
Item 5. Other Information 13
Item 6. Exhibits and Reports on Form 8-K 13
Signatures 13
Certifications 14
PART I - FINANCIAL INFORMATION
Item 1.
AVIC TECHNOLOGIES LTD.
(A Development Stage Enterprise)
BALANCE SHEETS
- -----------------------------------------------------------------------------------------------------------------------------------
June 30,
2003 December 31,
(Unaudited) 2002
---------------- ---------------
---------------- ---------------
ASSETS
Cash $ 4,740 $ 4,730
---------------- ---------------
TOTAL $ 4,740 $ 4,730
================ ===============
================ ===============
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
Accrued and other liabilities $ 47,622 $ 44,259
Note payable to stockholder 10,000 10,000
---------------- ---------------
Total liabilities 57,622 54,259
---------------- ---------------
---------------- ---------------
STOCKHOLDERS' DEFICIT:
Common stock - $0.0001 par value; 50,000,000 shares authorized; 19,721,000
and 15,221,000 shares issued
and outstanding, respectively 1,972 1,522
Additional paid-in capital 834,076 699,189
Deficit accumulated during the development stage (888,930) (750,240)
---------------- ---------------
---------------- ---------------
Total stockholders' deficit $ (52,882) (49,529)
---------------- ---------------
---------------- ---------------
TOTAL $ 4,740 $ 4,730
================ ===============
================ ===============
- -----------------------------------------------------------------------------------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS.
3
AVIC TECHNOLOGIES LTD.
(A Development Stage Enterprise)
STATEMENTS OF OPERATIONS
(Unaudited)
- -----------------------------------------------------------------------------------------------------------------------------------
For the For the For the For the For the Period
three months six three six March 4, 1999
ended months months months (date of
June 30, 2003 ended ended ended incorporation)
June 30, June 30, June 30, to June 30, 2003
2003 2002 2002
-------------- --------------- --------------- ------------- ------------------
REVENUES:
Consulting $ - $ - $ - $ - $ 86,544
Other income - - - - 10,000
Interest income - - - - 5,390
-------------- --------------- --------------- ------------- ------------------
Total revenues - - - - 101,934
-------------- --------------- --------------- ------------- ------------------
EXPENSES:
Officer and director compensation 37,500 75,188 - - 255,188
Consulting and professional fees 23,793 47,656 13,052 13,753 479,415
Website design - - - - 32,000
Occupancy 7,500 15,038 10,500 21,000 162,038
Interest 300 600 - - 1,800
Other 30 208 1,020 1,101 60,423
-------------- --------------- --------------- ------------- ------------------
Total expenses 69,123 138,690 24,572 35,854 990,864
-------------- --------------- --------------- ------------- ------------------
NET LOSS $ (69,123) $ (138,690) $ (24,572) $ (35,854) $ (888,930)
============== =============== =============== ============= ==================
Net Loss Per Share -
Basic and Diluted $ 0.00 $ 0.01 $ 0.00 $ 0.00
============== =============== =============== =============
Weighted Average Number of Shares
Outstanding 19,721,000 18,154,700 13,340,300 13,458,400
============== =============== =============== =============
- -----------------------------------------------------------------------------------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS.
4
AVIC TECHNOLOGIES LTD.
(A Development Stage Enterprise)
STATEMENT OF STOCKHOLDERS' DEFICIT
FOR THE SIX MONTHS ENDED JUNE 30, 2002
- -----------------------------------------------------------------------------------------------------------------------------------
Deficit
Accumulated
Additional During the
Common Stock Paid-In Development
Shares Amount Capital Stage Total
---------------- ----------------- --------------- ----------------- ------------
Balances, December 31, 2002 15,221,000 $ 1,522 $ 699,189 $ (750,240) $(49,529)
Issuance of common stock for services
and rent (net of deferred compensation
of $134,663) 4,500,000 450 134,887 - 135,337
Net Loss - - (138,690) (138,690)
---------------- ----------------- --------------- ----------------- ------------
Balances, June 30, 2003 19,721,000 1,972 $834,076 $ (888,930) $ (52,882)
================ ================= =============== ================= ============
- -----------------------------------------------------------------------------------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS.
5
AVIC TECHNOLOGIES LTD.
(A Development Stage Enterprise)
STATEMENTS OF CASH FLOWS
(Unaudited)
- -----------------------------------------------------------------------------------------------------------------------------------
For the For the For the For the For the
three six three six period March
months months months months 4, 1999
ended ended ended ended (date of
June 30, June 30, June 30, June 30, incorporation)
2003 2003 2002 2002 to June 30,
2003
----------- ------------- ------------- ------------ --------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (69,123) $ (138,690) $ (24,572) $ (35,854) $ (888,930)
Adjustments to reconcile net loss to net cash
used by operating activities:
Stock based compensation, consulting and rent 67,500 135,337 21,832 25,333 602,637
(Decrease) increase in accrued and other
liabilities (38) (1,637) 937 (4,986) 42,622
----------- ------------- ------------- ------------ --------------
NET CASH USED BY OPERATING
ACTIVITIES (1,661) (4,990) (1,803) (15,507) (243,671)
----------- ------------- ------------- ------------ --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Loan made - - - - (25,000)
Repayment of loan - - - - 25,000
----------- ------------- ------------- ------------ --------------
NET CASH PROVIDED BY INVESTING
ACTIVITIES - - -
----------- ------------- ------------- ------------ --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Loans and advances from stockholders 5,000 5,000 3,000 3,000 37,646
Repayments of loans from stockholders - - - - (22,646)
Cash paid for stock issuance costs - - - - (45,189)
Proceeds from the issuance of common stock - - - - 278,600
----------- ------------- ------------- ------------ --------------
NET CASH PROVIDED BY FINANCING
ACTIVITIES 5,000 5,000 3,000 3,000 248,411
----------- ------------- ------------- ------------ --------------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS 3,339 10 1,197 (12,507) 4,740
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD 1,401 4,730 1,466 15,170 -
----------- ------------- ------------- ------------ --------------
CASH AND CASH EQUIVALENTS,
END OF PERIOD $ 4,740 $ 4,740 $ 2,663 $ 2,663 $ 4,740
=========== ============= ============= ============ ==============
Supplemental disclosure of cash flow information:
Cash Paid For:
Interest $ - $ - $ - $ - $ -
============ ============= ============= ============ ==============
Income taxes $ - $ - $ - $ - $ -
============ ============= ============== ============ ==============
- -----------------------------------------------------------------------------------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS.
6
AVIC TECHNOLOGIES LTD.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
- --------------------------------------------------------------------------------
NOTE A - FORMATION AND OPERATIONS OF THE COMPANY
Avic Technologies Ltd., Inc. ("we", "us", "our") was incorporated under the laws
of the state of Delaware on March 4, 1999. We currently are considered to be in
the development stage as defined in Financial Accounting Standards Board
Statement No. 7.
We initially intended to participate in the building industry in China and other
parts of Asia, however for various reasons, our business in China has stagnated
and therefore during the year ended December 31, 2002, our Board decided that it
was in the best interests of the shareholders to dispose of the current business
and seek other opportunities in the area of environment and pollution controls.
Towards this goal, on August 26, 2002, we entered into an agreement to acquire
Ecolo-Mondo Ltd from International Management Technologies ("IMT"). Ecolo-Mondo
is a Canadian company engaged in the field of waste recycling and production of
energy. The sale was scheduled to close by November 2002, however IMT was unable
to meet various conditions and requirements included in our agreement. As such
on November 15, 2002, we notified IMT that we were terminating the proposed
acquisition. We are currently having discussions with several potential merger
partners, however we are uncertain as to whether any of these negotiations will
result in a merger and/or acquisition.
Use of Estimates
The preparation of financial statements in accordance with generally accepted
accounting principles requires us to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosures of contingent
assets and liabilities at the date of the financial statements. The reported
amounts of revenues and expenses during the reporting period may be affected by
the estimates and assumptions we are required to make. Actual results could
differ significantly from those estimates.
Basis of Presentation
Our accompanying unaudited financial statements have been prepared in accordance
with accounting principles generally accepted in the United States of America
for interim financial information and the instructions to Form 10-QSB and Rule
10-1 of Regulation S-X of the Securities and Exchange Commission (the "SEC").
Accordingly, these financial statements do not include all of the footnotes
required by accounting principles generally accepted in the United States of
America. In our opinion, all adjustments (consisting of normal and recurring
adjustments) considered necessary for a fair presentation have been included.
Operating results for the six months ended June 30, 2003 are not necessarily
indicative of the results that may be expected for the year ended December 31,
2003. The accompanying financial statements and the notes thereto should be read
in conjunction with our audited financial statements as of and for the year
ended December 31, 2002 contained in our Form 10KSB.
7
Revenue Recognition
We record revenues as services are rendered.
NOTE B - GOING CONCERN
The accompanying financial statements have been prepared on a going concern
basis, which contemplates the realization of assets and the satisfaction of
liabilities in the normal course of business. We have incurred a net loss of
approximately $889,000 for the period March 4, 1999 (date of incorporation) to
June 30, 2003. Our ability to continue as a going concern is ultimately
contingent upon our ability to attain profitable operations through the
successful development or integration of an operating business. In the interim,
we hope to secure additional financing from various shareholders to assist us
with our cash flow requirements, however there is no assurance that we will be
successful in doing so, and/or with our efforts to locate and merge with or
develop a suitable business. These factors, among others, indicate that we may
be unable to continue as a going concern for a reasonable period of time. Our
financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or the amounts and
classification of liabilities that might be necessary should we be unable to
continue as a going concern.
NOTE C - RELATED PARTY TRANSACTIONS
On May 11, 2001 our registration statement with the Securities and Exchange
Commission to allow various stockholders to offer to sell 6,565,000 shares of
the common stock they own in our company was declared effective. We paid all
expenses associated with the registration of the shares and printing of the
prospectus.
In December 2001, we borrowed approximately $10,000 from a stockholder. The
note, which is unsecured and accrues interest at the rate of 12% annum, was due
along with all accrued interest on December 8, 2002. The note was not paid and
is in default. Accordingly, although no such claims have been made to date, the
note holder has the right to claim immediate, liquidated damages of $1,000 per
month in addition to the repayment of principal and interest. One of our
directors has guaranteed repayment of this obligation.
During the quarter ended June 30, 2003, one of our directors advanced $5,000 to
us. This amount is included in accrued and other liabilities. In addition, as of
such date, accrued and other liabilities includes approximately $39,900 owed for
services rendered and expenses incurred by various stockholders; two of whom are
also officers and directors. All of these amounts are unsecured, non-interest
bearing and due on demand.
We lease our office space and secretarial support from an entity owned by one of
our stockholders under a lease agreement, which required monthly consideration
of $3,500 through September 2002. During the period October 1, 2002 to December
31, 2002, this stockholder provided similar rent and services to us at no cost,
and no value was ascribed to such rent and services in our statement of
operations for such period. Total rent during the six months ended June 30, 2003
and 2002, and the period March 4, 1999 (date of incorporation) to June 30, 2003
approximated $15,000, $21,000, and $162,000, respectively. In connection with
this arrangement, our landlord accepted 195,455 shares of our common stock as
consideration for rent for the period March 1, 2002 to September 2002, and
500,000 shares of our common stock as consideration for rent for the year ended
December 31, 2003. Because the 500,000 shares of stock represent consideration
for rent for the entire year ended December 31, 2003, $7,500 (or twenty-five
percent of the value of the shares) has been recognized as expense during each
of the quarters ended March 31 and June 30, 2003; the remaining amount has been
deferred through a reduction in additional paid-in capital and will be
recognized as rent is provided. Also, the shares are subject to recall and
cancellation if we fail to merge with a certain company by September 30, 2003.
8
During the years ended December 31, 2002, 2001 and 2000, we recognized $55,000,
$35,000 and $60,000, respectively of officer and director compensation (as
consideration for these services, we issued 500,000, 400,000 and 600,000 shares
of our common stock, respectively). In addition, during the three months ended
March 31, 2003, we issued 2,500,000 shares of our common stock to our Vice
President and Director. Because these shares represent consideration for
services to be provided for the entire year ended December 31, 2003,
approximately $37,500 (or twenty-five percent of the value of the shares) has
been recognized as expense during each of the quarters ended March 31 and June
30, 2003; the remaining amount has been deferred through a reduction in
additional paid-in capital and will be recognized as the services are provided.
Also, the shares are subject to recall and cancellation if we fail to merge with
a certain company by September 30, 2003.
We believe these amounts represent the fair value of the services provided to us
by our officers during these periods. No amounts were ascribed to services
provided by our officers prior to January 1, 2000, or during the six months
ended June 30, 2002, as during these periods, we engaged and directed
consultants to perform the majority of the services we required; accordingly we
believe the value of services provided by our officers was not considered
significant during these times.
In addition to various stock based expenses discussed above, during the period
March 4, 1999 (date of incorporation) to June 30, 2003, we issued the following
shares of our common stock as consideration for the following services, which
were provided by entities in which various stockholders have ownership
interests:
Description of Service Value of Service Share Price Shares Issued Date Issued
---------------------- ---------------- ----------- ------------- -----------
Website Design $ 32,000 $0.10 320,000 12/2/99
Equipment Appraisal $ 28,800 $0.10 288,000 12/2/99
Search for Joint Venture Partners $ 23,500 $0.10 235,000 12/2/99
Promotion and Capital Raising Services $ 40,000 $0.10 400,000 9/26/01
Capital and Joint Venture Assistance $ 20,000 $0.10 200,000 9/26/01
Capital and merger partner assistance $ 88,500 $0.11 804,545 6/13/02
Capital and merger partner assistance $ 55,000 $0.11 500,000 8/26/02
Capital and merger partner assistance $ 90,000 $0.06 1,500,000 3/05/03
-------- ---------
Totals $377,800 4,247,545
======== =========
The value of these services, which was based on the number, and fair value, of
shares issued (share prices represent the price at which other shares were sold
at the date the services were rendered), has been (or in the case of the
1,500,000 shares issued on March 5, 2003 ultimately is expected to be) included
in various expenses. The 1,500,000 shares of stock issued on March 5, 2003
represent consideration for services to be provided for the entire year ended
December 31, 2003. Accordingly, twenty-five percent of the value above has been
recognized as expense during each of the quarters ended March 31 and June 30,
2003; the remaining amount has been deferred through a reduction in additional
paid-in capital and will be recognized as expense as the services are provided.
Also, the shares are subject to recall and cancellation if we fail to merge with
a certain company by September 30, 2003.
During the period March 4, 1999 (date of incorporation) to December 31, 1999, we
paid $38,500 for certain consulting services to an entity owned by a family
member of one of our directors and stockholders.
9
In connection with a Regulation S offering, we paid fees of approximately
$36,000 to a company partially owned by a spouse of one of our directors and
stockholders. Because the costs related to the sale of our stock, they have been
reflected as a reduction of stockholders' equity in the accompanying financial
statements.
NOTE D - INCOME TAXES
We recognized losses for both financial and tax reporting purposes during each
of the periods in the accompanying statements of operations. Accordingly, no
provision for income taxes and/or deferred income taxes payable have been
provided for in the accompanying financial statements.
At June 30, 2003 we had net operating loss carryforwards of approximately
$616,100 for income tax purposes. Assuming that a future merger, acquisition
and/or other transaction does not trigger a "change in control" (as defined by
Internal Revenue Service rules and regulations), these carryforwards will be
available to offset future taxable income in various periods ended June 30,
2023. The deferred income tax assets arising from these net operating loss
carryforwards are not recorded in the accompanying balance sheets because we
established a valuation allowance to fully reserve such asset as their
realization did not meet the required asset recognition standards established by
SFAS 109.
Temporary differences arise primarily from certain accrued liabilities that are
not deductible for income tax purposes until they are paid.
NOTE E - NET LOSS PER SHARE
We compute net loss per share in accordance with SFAS No. 128 "Earnings per
Share" ("SFAS No. 128") and SEC Staff Accounting Bulletin No. 98 ("SAB 98").
Under the provisions of SFAS No. 128 and SAB 98, basic net loss per share is
computed by dividing the net loss available to common stockholders for the
period by the weighted average number of common shares outstanding during the
period. Diluted net loss per share is computed by dividing the net loss for the
period by the number of common and common equivalent shares outstanding during
the period. There have been no common equivalent shares outstanding at any time
since our inception; accordingly basic and diluted net loss per share are
identical for each of the periods in the accompanying financial statements.
NOTE F - SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
During the three months ended June 30, 2002, accrued and other liabilities
decreased by approximately $3,500 when we issued common stock as consideration
for rent and secretarial support (see Note C).
During the three months ended June 30, 2002, prepaid expenses increased by
$87,668 when we issued common stock for future office rent, secretarial support
and various consulting services (see Note C).
- --------------------------------------------------------------------------------
10
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion and analysis should be read in conjunction with the
balance sheet as of December 31, 2002, and the financial statements as of and
for the three and six months ended June 30, 2003 and 2002 included with this
Form 10-QSB.
Readers are referred to the cautionary statement at page 12, which addresses
forward-looking statements.
We are considered to be in the development stage as defined in Financial
Accounting Standards Board Statement No. 7. With the exception of cash, we have
no assets.
Results of operations for the three months ended 6/30/03 vs. 6/30/02
During the three months ended June 30, 2003 and 2002, we did not generate any
revenue as our primary focus during these periods was to search for a merger
and/or acquisition partner.
During the three months ended June 30, 2003 and 2002, we incurred total expenses
of approximately $69,100 and $24,600, respectively. These expenses consisted
substantially of officer and director compensation, and consulting and
professional fees during the three months ended June 30, 2003 (substantially all
of these expenses were stock based) and consulting and professional fees, and
occupancy during the three months ended June 30, 2002. We did not record officer
and director compensation for the three months ended June 30, 2002 because
services provided by our management were negligible during this period.
Results of operations for the six months ended 6/30/03 vs. 6/30/02
During the six months ended June 30, 2003 and 2002, we did not generate any
revenue as our primary focus during these periods was to search for a merger
and/or acquisition partner.
During the six months ended June 30, 2003 and 2002, we incurred total expenses
of approximately $138,700 and $35,900, respectively. These expenses consisted
substantially of officer and director compensation, and consulting and
professional fees during the six months ended June 30, 2003 (substantially all
of these expenses were stock based) and consulting and professional fees, and
occupancy during the six months ended June 30, 2002. We did not record officer
and director compensation for the six months ended June 30, 2002 because
services provided by our management were negligible during this period.
Since Inception
Since our inception we have generated revenues and incurred expenses of
approximately $102,000 and $991,900, respectively, resulting in a cumulative net
loss of approximately $889,000. Substantially all of the revenues arise from
consulting services provided to a Chinese entity. With respect to our expenses,
approximately $602,700 of the expenses were satisfied by the issuance of our
common stock. In addition, our expenses also include $25,000 of accrued
compensation arising from services provided by two of our shareholders, which
will only be paid if cash flow permits. After exclusion of these items, we have
incurred expenses that have and/or will require the expenditure of cash of
approximately $364,200. Most of these expenses were funded by $233,000 in net
proceeds we received from sales of our common stock and the aforementioned
revenues of $102,000.
11
Liquidity
At the end of the quarter, on June 30, 2003, we have $4,740 in cash. We do not
currently have sufficient cash to pay our expenses over the next twelve months.
Unless we are able to (1) generate cash flow from operations; (2) locate a
strategic partner; or (3) secure additional financing, we will ultimately
exhaust our cash, and will be unable to fund any significant additional
expenditure or implement our business plan.
CAUTIONARY STATEMENT
This Form 10-QSB, press releases and certain information provided periodically
in writing or orally by our officers or our agents contain statements which
constitute forward-looking statements within the meaning of Section 27A of the
Securities Act, as amended and Section 21E of the Securities Exchange Act of
1934. The words expect, anticipate, believe, goal, plan, intend, estimate and
similar expressions and variations thereof, if used, are intended to
specifically identify forward-looking statements. Those statements appear in a
number of places in this Form 10-QSB and in other places, particularly,
Management's Discussion and Analysis or Results of Operations, and include
statements regarding the intent, belief or current expectations us, our
directors or our officers with respect to, among other things: (i) our liquidity
and capital resources; (ii) our financing opportunities and plans and (iii) our
future performance and operating results. Investors and prospective investors
are cautioned that any such forward-looking statements are not guarantees of
future performance and involve risks and uncertainties, and that actual results
may differ materially from those projected in the forward-looking statements as
a result of various factors. The factors that might cause such differences
include, among others, the following: (i) any material inability to successfully
internally develop our products; (ii) any adverse effect or limitations caused
by Governmental regulations; (iii) any adverse effect on our positive cash flow
and ability to obtain acceptable financing in connection with our growth plans;
(iv) any increased competition in business; (v) any inability to successfully
conduct our business in new markets; and (vi) other risks including those
identified in our filings with the Securities and Exchange Commission. We
undertake no obligation to publicly update or revise the forward looking
statements made in this Form 10-QSB to reflect events or circumstances after the
date of this Form 10-QSB or to reflect the occurrence of unanticipated events.
Item 3. CONTROLS AND PROCEDURES
Within 90 days prior to the date of filing of this report, we carried out an
evaluation, under the supervision and with the participation of our management,
including the Chief Executive Officer (who also effectively serves as our
Principal Financial Officer), of the design and operation of our disclosure
controls and procedures. Based on this evaluation, our Chief Executive Officer
concluded that our disclosure controls and procedures are effective for the
gathering, analyzing and disclosing the information we are required to disclose
in the reports we file under the Securities Exchange Act of 1934, within the
time periods specified in the SEC's rules and forms. There have been no
significant changes in our internal controls or in other factors that could
significantly affect internal controls subsequent to the date of this
evaluation.
PART II. - OTHER INFORMATION
Item 1. Legal Proceedings
NONE
Item 2. Changes in Securities
NONE
12
Item 3. Defaults Upon Senior Securities
NONE
Item 4. Submission of Matters to a Vote of Securities Holders
NONE
Item 5. Other Information
NONE
Item 6. Exhibits and Reports on Form 8-K
99.1 Sarbanes-Oxley exhibit
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SIGNATURE TITLE DATE
--------- ----- ----
Annette Shaw Chief Executive and Chief Accounting July 30, 2003
Officer
13
CERTIFICATIONS
I, Annette Shaw, certify that:
1. I have reviewed this quarterly report on Form 10QSB of AVIC Technologies,
Ltd.;
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; and
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
issuer as of, and for, the periods presented in this quarterly report.
4. I am responsible for establishing and maintaining disclosure controls and
procedures for the issuer and have:
(i) Designed such disclosure controls and procedures to ensure that
material information relating to the issuer is made known to me, particularly
during the period in which the periodic reports are being prepared;
(ii) Evaluated the effectiveness of the issuer's disclosure controls and
procedures as of June 30, 2003 ("Evaluation Date"); and
(iii) Presented in the report my conclusions about the effectiveness of the
disclosure controls and procedures based on my evaluation as of the Evaluation
Date;
5. I have disclosed, based on my most recent evaluation, to the issuer's
auditors and the audit committee of the board of directors (or persons
fulfilling the equivalent function):
(i) All significant deficiencies in the design or operation of internal
controls which could adversely affect the issuer's ability to record, process,
summarize and report financial data and have identified for the issuer's
auditors any material weaknesses in internal controls; and
(ii) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the issuer's internal controls; and
(6) I have indicated in the report whether or not 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: July 30, 2003
/s/ Annette Shaw
Annette Shaw
Chief Executive and Chief Accounting Officer
14
Exhibit 99.1
CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
(18 U.S.C. SECTION 1350)
In connection with the quarterly filing of AVIC Technologies, Ltd., a Delaware
corporation (the "Company"), on Form 10QSB for the period ended June 30, 2003,
as filed with the Securities and Exchange Commission (the "Report"), I, Annette
Shaw, Director and Chief Financial Officer of the Company, certify, pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C.ss.1350), that:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of
the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and result of operations of the Company.
/S/Annette Shaw
Annette Shaw
Chief Executive and Chief Accounting Officer
July 30, 2003