UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark one)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2003
_________________________________________________
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from N/A to N/A
___________________ ______________________
Commission File Number: 000-28675
________________________________________________________
Tribeworks, Inc.
________________________________________________________________________________
(Exact name of small business issuer as specified in its charter)
Delaware 94-3370795
________________________________________________________________________________
(State or other jurisdiction of incorporation (I.R.S. Employer Identification
or organization) No.)
988 Market Street, San Francisco, CA 94102
________________________________________________________________________________
(Address of principal executive offices) (Zip Code)
(415) 674-5555
________________________________________________________________________________
(Issuer's telephone number, including area code)
N/A
________________________________________________________________________________
(Former name,former address and former fiscal year,if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. X Yes No
___ ___
The number of shares outstanding of registrant's $0.0001 par value common
stock, as of the close of business on May 15, 2003: 18,634,628 shares.
Transitional Small Business Disclosure Format: Yes X No
___ ___
TRIBEWORKS, INC.
FIRST QUARTER 2003 REPORT ON FORM 10-QSB
TABLE OF CONTENTS
PAGE
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Unaudited Consolidated Balance Sheet
March 31, 2003 3
Unaudited Consolidated Statements of Income (Loss)
Three Months Months Ended March 31, 2003 and 2002 4
Unaudited Consolidated Statements of Cash Flows
Three Months Ended March 31, 2003 and 2002 5
Notes to Unaudited Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis or Plan of Operation 9
Item 3. Controls and Procedures 11
PART II. OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds 12
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 13
Exhibits 14
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PART I - FINANCIAL STATEMENTS
ITEM 1. FINANCIAL STATEMENTS.
TRIBEWORKS, INC.
UNAUDITED CONSOLIDATED BALANCE SHEET
MARCH 31, 2003
Current Assets
Cash $ 55,683
Accounts receivable, net of allowance for doubtful accounts of $3,442 36,623
Costs and estimated earnings in excess of billings
on uncompleted contracts 120,439
Prepaid expenses 39,033
_____________
TOTAL CURRENT ASSETS 251,778
_____________
Other Assets
Equipment, net of accumulated depreciation of $48,867 1,925
_____________
TOTAL ASSETS $ 253,703
=============
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts payable $ 255,178
Accrued expenses 93,565
Due to shareholders 6,232
Deferred revenue 131,409
Convertible note payable 100,000
_____________
TOTAL CURRENT LIABILITIES 586,384
_____________
Stockholders' Deficit
Preferred stock: 10,000,000 shares authorized, none issued
Common stock: $.0001 par value, 200,000,000 shares authorized,
18,634,628 shares issued and outstanding 1,843
Additional paid-in capital 3,009,765
Unearned compensation (7,780)
Accumulated deficit (3,336,509)
_____________
TOTAL STOCKHOLDERS' DEFICIT (332,681)
_____________
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 253,703
=============
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TRIBEWORKS, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
Three Months Ended March 31,
2003 2002
____ ____
REVENUES $ 364,442 $ 330,009
COST OF SALES 134,936 112,663
____________ ____________
GROSS PROFIT 229,506 217,346
____________ ____________
OPERATING EXPENSES
Product support 11,601 13,654
Product development 27,945 13,427
Sales and marketing 57,874 43,046
General and administrative 105,793 147,968
____________ ____________
203,213 218,097
____________ ____________
INCOME (LOSS) FROM OPERATIONS 26,293 (751)
INCOME TAXES - -
____________ ____________
NET INCOME (LOSS) $ 26,293 $ (751)
============ ============
BASIC AND DILUTED LOSS PER COMMON SHARE $ 0.00 $ (0.00)
============ ============
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING 18,634,628 18,434,628
============ ============
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TRIBEWORKS, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended March 31,
2003 2002
____ ____
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ 26,293 $ (751)
____________ ____________
Adjustments:
Depreciation and amortization 3,860 14,883
Amortization of unearned compensation 2,895 2,838
Changes in:
Accounts receivable (4,178) 19,753
Costs and estimated earnings in excess of billings on
uncompleted contracts (120,439) 188,433
Prepaid expenses (979) (7,499)
Accounts payable 6,674 (156,435)
Deferred revenue and billings in excess of costs
and estimated earnings on uncompleted contracts (37,411) (65,041)
Other liabilities 38,012 (16,811)
____________ ____________
Total adjustments (111,566) (19,879)
____________ ____________
Net cash used in operating activities (85,273) (20,630)
____________ ____________
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of equipment (2,197) -
____________ ____________
NET DECREASE IN CASH (87,470) (20,630)
CASH, BEGINNING OF PERIOD 143,153 47,753
____________ ____________
CASH, END OF PERIOD $ 55,683 $ 27,123
============ ============
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TRIBEWORKS, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2003
NOTE A - PRINCIPLES OF PRESENTATION
The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-QSB. Accordingly, they do not include all
of the information and footnotes required by generally accepted accounting
principles for complete financial statements, although the Company believes that
the disclosures are adequate to make the information presented not misleading.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) necessary for a fair presentation of the Company's financial position
as of March 31, 2003, and its results of operations and cash flows for the three
months then ended have been included. However, operating results for the interim
periods noted are not necessarily indicative of the results that may be expected
for the year ending December 31, 2003. This report should be read in conjunction
with the Company's financial statements and notes thereto contained in the
Company's annual report on Form 10-KSB for the year ended December 31, 2002.
NOTE B - NATURE OF BUSINESS AND ORGANIZATION
On August 20, 1998, the Company began its business activities. The Company's
business activity results from a technology that provides tools for creating and
delivering multimedia applications. Internet media developers use the technology
for creation and deployment of electronic content that utilizes interactive
features combining audio, video, animation and graphics content. The Company
exploits its software primarily through memberships and customized licensed
versions that include professional engineering to meet contract requirements.
NOTE C - BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF CONSOLIDATION
The financial statements of the Company are presented on a consolidated basis
and include the Company and its wholly-owned subsidiaries, Tribeworks
Development Corporation and Tribeworks Japan Limited. The Company's operations
are conducted through its subsidiaries. All material intercompany transactions
have been eliminated.
USE OF 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 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. Estimates and assumptions are reviewed periodically and
the effects of revisions are reflected in the consolidated financial statements
in the period they are determined.
EQUIPMENT
Equipment is stated at cost less accumulated depreciation. The Company has
adopted a policy of capitalizing all equipment over $1,000. Depreciation is
determined using the straight-line method over the estimated useful lives of the
assets. Useful lives are estimated to be three years.
TECHNOLOGY LICENSE
The Company's principal business activity centers around the commercialization
of iShell, which was developed by an officer and director of the Company and an
affiliate of the Company. In November 1999, the Company purchased all rights,
title and interest in iShell in exchange for $100,000 and warrants to purchase
303,030 shares of common stock at an exercise price of $0.33 per share, valued
at $30,000. The $130,000 cost has been fully amortized.
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TRIBEWORKS, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2003
NOTE C - BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
REVENUE RECOGNITION
Revenue is generally recognized when all contractual or transfer obligations
have been satisfied and collection of the resulting receivable is probable.
Revenues from membership subscriptions are recognized proportionally over the
membership period, usually one year. Revenues and estimated profits on custom
development services are generally recognized under the percentage-of-completion
method of accounting using an input measurement methodology; profit estimates
are revised periodically based on changes in facts; any losses on contracts are
recognized immediately. Revenue from the sale of licenses are recognized when
all the following criteria are met: persuasive evidence of an agreement exists,
delivery has occurred, the fee is fixed or determinable and collectability is
probable. If all aspects but the last have not been met or if post contract
customer support could be material, revenue is recognized as payments from
customers become due.
COMPENSATED ABSENCES
The Company accrues vacation pay for all full-time employees.
SOFTWARE DEVELOPMENT COSTS
The Company expenses all software development costs in the period the costs are
incurred.
STOCK-BASED AWARDS
The Company accounts for stock based awards to employees under its "Equity
Incentive Plan" as compensatory in accordance with Accounting Principles Board
Opinion No. 25, "ACCOUNTING FOR STOCK ISSUED TO EMPLOYEES." The Company also
issues stock based awards for services performed by consultants and other
non-employees and accounts for them in accordance with Statement of Financial
Accounting Standards No. 123, "ACCOUNTING FOR STOCK-BASED COMPENSATION."
Financial Accounting Standards Board Statement No. 148, "ACCOUNTING FOR
STOCK-BASED COMPENSATION - TRANSITION AND DISCLOSURE" (SFAS 148) requires the
Company to provide pro forma information regarding net loss and loss per share
as if compensation cost for all awards had been determined in accordance with
fair value based on the method prescribed in SFAS 123 as follows:
March 31, March 31,
2003 2002
_________ __________
Net income (loss), as reported $ 26,293 $ (751)
Add: Stock-based compensation expense included in
net income or loss, no tax effect 338 675
Deduct: Total stock-based compensation expense
determined under fair value method for all awards, no
tax effect (3,953) (16,710)
_________ __________
Pro forma net income (loss) $ 22,678 $ (16,786)
========= ==========
Net income (loss) per share, basic and diluted:
As reported $ 0.00 $ (0.00)
========= ==========
Pro forma $ 0.00 $ (0.00)
========= ==========
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TRIBEWORKS, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2003
NOTE C - BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
FOREIGN CURRENCY TRANSLATION
Tribeworks Japan prepares its financial statements in a currency other than U.S.
dollars. Results of operations and cash flows are translated at average exchange
rates during the period, and assets and liabilities are translated at
end-of-period exchange rates. For the quarter ended March 31, 2003, the foreign
currency translation effect was immaterial and, therefore, translation
adjustments were not included as a separate component of accumulated other
comprehensive income (loss) in stockholders' equity (deficit).
NET EARNINGS (LOSS) PER COMMON SHARE
Basic earnings (loss) per share (EPS) is computed based on net income (loss)
divided by the weighted average number of common shares outstanding. Diluted EPS
is computed based on net income (loss) divided by weighted average number of
common and potential common share equivalents. The only potential common share
equivalents are those related to stock options and warrants and the convertible
note payable; however, such potential common share equivalents are anti-dilutive
for the three months ended March 31, 2002 and immaterial for the three months
ended March 31, 2003. Therefore, the diluted EPS is the same as basic EPS.
NOTE D - COSTS, ESTIMATED EARNINGS AND BILLINGS ON UNCOMPLETED CONTRACTS
At March 31, 2003, costs and estimated earnings in excess of billings on
uncompleted contracts consisted of approximately $95,000 of costs, $108,000 of
estimated earnings, less $83,000 of billings.
NOTE E - CONVERTIBLE NOTE
On January 21, 2001, the Company borrowed $100,000 under a Private Placement
Agreement. Under the terms of the agreement the lender, upon the closing of a
"Qualified Financing" (as that term is defined in the agreement), can convert
the loan to common stock of the Company. The note is convertible at a price per
share equal to the lesser of (1) the average closing price of the Company's
stock for ten days prior to issuance of the note or (2) the price per share paid
by investors in the Qualified Financing. As part of the agreement, the Company
issued 20,000 two-year warrants to purchase common stock at $0.01 per share. The
note bears interest at 10% per annum payable at maturity. The holder has the
right to demand payment within 30 days or upon a "Company Sale", and the note is
unsecured.
NOTE F - GOING CONCERN
The accompanying consolidated financial statements have been prepared in
conformity with generally accepted accounting principles, which contemplate the
continuation of the Company as a going concern. However, although the Company
reported net income during 2002 and during the first quarter of 2003, the
Company incurred a net loss of approximately $314,000 and $1,950,000 for the
years ended December 31, 2001 and 2000, respectively, and had a working capital
deficiency of approximately $335,000 and an equity deficiency of approximately
$333,000 at March 31, 2003. The Company has also deferred payment of certain
accounts payable and accrued expenses. Given these results, additional capital
or improved operations will be needed to sustain the Company's operations.
Management's plans in this regard include additional marketing of its product
line with special emphasis on custom development services and technology
licensing opportunities in the U.S. and in Japan via its U.S. entity or its
Tribeworks Japan subsidiary.
In view of the matters described, there is substantial doubt about the Company's
ability to continue as a going concern. The recoverability of the recorded
assets and satisfaction of the liabilities reflected in the accompanying balance
sheet is dependent upon continued operation of the Company, which is in turn
dependent upon the Company's ability to meet its cash flow requirements on a
continuing basis and to succeed in its future operations. There can be no
assurance that management will be successful in implementing its plans. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
FORWARD LOOKING STATEMENTS
The following discussion contains forward-looking statements that are
subject to risks and uncertainties. There are several important factors that
could cause actual results to differ materially from historical results and
percentages and results anticipated by the forward-looking statements, such as,
but not limited to:
o whether or not our products are accepted by the marketplace and the
pace of any such acceptance,
o our ability to continue to grow our Tools and Enterprise businesses,
o improvements in the technologies of our competitors,
o changing economic conditions, and
o other factors, some of which will be outside of our control.
We have sought to identify most risks to our business but cannot predict
whether or to what extent any of such risks may be realized. There can be no
assurance that we have identified all possible risks that might arise. Investors
should carefully consider all such risks before making an investment decision
with respect to our common stock.
FINANCIAL CONDITION
We achieved net income of $26,293 for the first quarter of 2003. Like
the profit we achieved for the year ending December 31, 2002 as announced in our
10-KSB, this quarter's profit represents a modest net income figure.
Nonetheless, although not all of the recent past quarters have been profitable,
we are beginning to witness a trend toward consistent profitability. Our
financial success continues to rely on key contracts, the future existence of
which is not assured. For instance, our business with a single customer, Pioneer
Corporation, accounted for 66% of our total revenues for this quarter.
Regardless of the uncertainties, we feel that we have more a robust pipeline of
business opportunities than we had at March 31, 2002. This is due to improved
market positioning of the Company, which is a result of additional product
offerings, a more stabilized financial situation, and improving economic
conditions.
Our business consists of selling software and services to two
categories of customers. Tools customers license our iShell(R) branded
multimedia application authoring tools, by paying an annual subscription fee to
use our iShell software and supplemental products and services, or by purchasing
the software outright. Enterprise customers, usually large corporations that
require development of complex multimedia applications, license customized
versions of our software for a fixed fee or on a per unit basis. Enterprise
customers may also pay for professional engineering services performed by
Tribeworks' employees and consultants. Our intention is to expand our Tools
business and our Enterprise business.
We experienced a modest increase in the Tools business this quarter,
and we plan to accomplish future growth through ongoing addition of features to
our core iShell product, through introduction of new products, and through the
direct sales method we have used since our initial iShell product launch. This
sales method is based on a subscription model where most customers pay an annual
membership to use our products commercially. Using this sales method, we have
been able to produce high renewal rates. In addition to continuing to use this
direct sales method, we also plan to expand our selling efforts to include
additional publishing and distribution channels for our software.
In general, we anticipate Enterprise business growth, particularly
Enterprise professional services revenue, to be less predictable and "bumpier"
than our Tools business revenue in the foreseeable future, and this could impact
whether or not we continue to be profitable on a quarter-to-quarter basis. The
primary reason is that our Enterprise business has a smaller number of
customers. We expect to continue to underwrite the cost of software research and
development with money received from Enterprise customers.
The next major release of iShell, called iShell 3, was released during
the quarter. We have also announced iShell Mobile Edition (iShell ME), our first
new Tools product since the introduction of iShell. More information about our
products can be found at our website: http://www.tribeworks.com. The scope of
our current development activities includes 1) improvements and fixes for iShell
3, our Windows OS and Mac OS based authoring product, 2) continued development
-9-
of iShell Mobile Edition, our authoring product which allows developers to build
applications for delivery on the Palm OS, and 3) development of additional
multimedia tools, both professional and consumer, for devices other than the PC,
including mobile devices (especially those mobile devices that run the Palm OS),
set-top boxes, and digital signs.
We continue to strive to operate our business efficiently, without
investment of outside capital. While we are encouraged by our results, we cannot
make assurances that we will continue to operate profitability. In addition,
while we currently operate our business with limited resources and outstanding
debt, because we have been able to achieve positive results and because raising
money at our current market valuation would be highly dilutive for existing
shareholders, we do not have current plans for equity financing. To maximize
shareholder value, management continues to look at possible alternatives to take
the Company private. However, we do not currently have any formalized plans for
a going private transaction.
RESULTS OF OPERATIONS
REVENUES
Total revenues were $364,442 for the quarter ended March 31, 2003, an
increase of 10% compared to total revenues of $330,009 for the quarter ended
March 31, 2002. The Tools Business, which primarily includes sales of
memberships for commercial or educational use of our iShell software, and sales
of books and third party plug-ins, increased by 21% to $98,760 for the first
quarter of 2003, compared to $81,740 for the first quarter of 2002. The increase
is due to the release of iShell 3, a spike in manual sales due to the release of
a new manual, the beta release of iShell Mobile Edition, and somewhat improved
market conditions. The Enterprise business increased in the first quarter of
2003 by 7% to $265,682, compared with $248,269 for the first quarter of 2002.
Enterprise revenues for the first quarter of 2003 consisted of $261,738 in
professional services revenues and $3,944 in licensing revenues, compared with
$181,192 in professional services revenues and $67,077 in licensing revenues for
the first quarter of 2002. International revenues, which consist of sales to
foreign customers, represented 76% of revenues for the first quarter of 2003,
compared to 56% of revenues for the first quarter of 2002. Revenues from
Japanese customers increased to 66% of total revenues for the first quarter of
2003, from 47% for the first quarter of 2002. The increase in Japanese revenue
in the Enterprise business is based on the acquisition of a contract with
Pioneer Corporation for development of software products that allow users to
create and manage content for digital signs.
COST OF SALES
Cost of sales includes royalties paid to third parties for licensed
technology, costs associated with order fulfillment, and costs associated with
professional services, including salaries, consulting fees, and out-of-pocket
expenses. Cost of sales was $134,936 for the quarter ended March 31, 2003, up
from $112,663 for the quarter ended March 31, 2002. Gross margins decreased
modestly on a percentage basis to 63% for the first quarter of 2003 from 66% for
the first quarter of 2002.
OPERATING EXPENSES
Product support expenses consist mainly of compensation, benefits and
consulting fees paid to product support personnel. Product support expenses were
$11,601 and $13,654 for the quarters ended March 31, 2003 and 2002,
respectively. As a percentage of Tools sales, product support expenses were 12%
and 17% for the first quarters of 2003 and 2002, respectively.
Product development expenses consist primarily of compensation and
benefits to support product development. Product development expenses were
$27,945 and $13,427 for the quarters ended March 31, 2003 and 2002,
respectively. This increase primarily reflects the work performed to develop
iShell 3 and iShell Mobile Edition.
Sales and marketing expenses consist primarily of compensation and
benefits, mail order costs and other public relations and marketing costs. Sales
and marketing expenses were $57,874 and $43,046 for the quarters ended March 31,
2003 and 2002, respectively.
General and administrative expenses consist primarily of compensation
and benefits, fees for professional services, and overhead. General and
administrative expenses were $105,793 and $147,968 for the quarters ended March
31, 2003 and 2002, respectively. The decrease was primarily due to the decrease
in infrastructure costs for our Japanese subsidiary. Should our cash position
materially improve, we expect to pay increased salaries and fees to these key
employees and consultants, and therefore experience increased operating
expenses, especially in the general and administrative category.
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PROVISION (BENEFIT) FOR INCOME TAXES
We recorded no tax provision for the quarter ended March 31, 2003 and
no tax provision for the quarter ended March 31, 2002.
NET INCOME (LOSS)
Net income was $26,293 for the quarter ended March 31, 2003, compared
to a net loss of $751 for the quarter ended March 31, 2002.
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 2003, we had cash of $55,683 compared to $27,123 at March
31, 2002.
Our capital requirements have been reduced significantly from previous
quarters based on cost reductions. While our capital requirements continue to be
significant, we are not currently pursuing equity financing, due to our
stabilized working capital position and our low market capitalization. Since
inception, the Company has financed its operations through issuance of stock and
revenues from the Tools and Enterprise businesses. Through March 31, 2003, the
Company had raised $2,672,656 from the sale of stock. At March 31, 2003, the
principal source of liquidity for the Company was $55,683 of cash.
Cash used in operating activities was $85,273 for the quarter ended
March 31, 2003 and cash used in operating activities was $20,630 for the quarter
ended March 31, 2002. Cash used in investing activities for the quarters ended
March 31, 2003 and 2002 was $2,197 and $0, respectively. Cash provided by
financing activities for the quarters ended March 31, 2003 and 2002 was $0 and
$0, respectively.
We cannot make assurances that we will be profitable and that should
investment funds become necessary, that such funds will be available to us or
available on commercially reasonable terms. We do not expect to devote
substantial capital resources to additional hiring of personnel if more funds do
not become available to us. In addition, the inability to obtain sufficient
funds from operations and external sources would have a material adverse effect
on our business, results of operations, and financial condition.
ITEM 3. CONTROLS AND PROCEDURES
The Chief Executive Officer and the Chief Financial Officer of the
Registrant have concluded based on their evaluation as of a date within 90 days
prior to the date of the filing of this Report, that the Registrant's disclosure
controls and procedures are effective to ensure that information required to be
disclosed by the Registrant in the reports filed or submitted by it under the
Securities Act of 1934, as amended, is recorded, processed, summarized and
reported within the time periods specified in the Securities and Exchange
Commission's rules and forms, and include controls and procedures designed to
ensure that information required to be disclosed by the Registrant in such
reports is accumulated and communicated to the Registrant's management,
including the president, as appropriate to allow timely decisions regarding
required disclosure.
There were no significant changes in the Company's internal controls or in other
factors that could significantly affect these controls subsequent to the date of
such evaluation.
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PART II - OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
We made no sales of the Company's unregistered common stock during the
quarter ended March 31, 2003.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) The following exhibits are included in this report or incorporated
by reference into this report:
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
______ _______________________
2.1 Agreement of Merger between Tribeworks, Inc., a California
corporation, and Tribeworks Acquisition Corporation, dated
November 2, 1999 (Incorporated by reference to Exhibit 2.1 to
the Registrant's Form 10-SB/A filed July 10, 2000).
3.1 Certificate of Incorporation of Tribeworks, Inc., a Delaware
Corporation (Incorporated by reference to Exhibit 3.1 to the
Registrant's Form 10-SB/A filed July 10, 2000).
3.2 Bylaws of Tribeworks, Inc., a Delaware Corporation
(Incorporated by reference to Exhibit 3.2 to the Registrant's
Form 10-SB/A filed July 10, 2000).
10.1 Consulting Agreement by and between Tribeworks, Inc., a
Delaware Corporation, and William R. Woodward, dated January 1,
2002 (Incorporated by reference to Exhibit 10.1 to the
Registrant's Form 10-QSB filed August 14, 2002).
99.1 Certification-CEO Pursuant to 18 U.S.C. Section 1350.
99.2 Certification-CFO Pursuant to 18 U.S.C. Section 1350.
(b) The following reports on Form 8-K were filed during the quarter ended March
31, 2003:
None.
-12-
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.
Tribeworks, Inc.,
a Delaware corporation
Date: May 15, 2003 /s/ DUNCAN J. KENNEDY
_____________________________________
Duncan J. Kennedy,
President and Chief Executive Officer
/s/ ROBERT C. DAVIDORF
_____________________________________
Robert C. Davidorf,
Chief Financial Officer
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CERTIFICATIONS PURSUANT TO
RULES 13A-14 AND 15D-14 OF THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED,
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Duncan J. Kennedy, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Tribeworks, Inc.:
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly report
is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly 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.
Dated: May 15, 2003
By: /s/ DUNCAN J. KENNEDY
_____________________________
Duncan J. Kennedy
Chief Executive Officer
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I, Robert C. Davidorf, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Tribeworks, Inc.:
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly report
is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and
6. The registrant's other certifying officers and I have indicated in
this quarterly 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.
Dated: May 15, 2003
/s/ ROBERT C. DAVIDORF
_______________________________
Robert C. Davidorf
Chief Financial Officer
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