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, 2006.
[ ] Transition report under Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to .
Commission file number: 0-27735
ASIA4SALE.COM, INC.
(Exact name of small business issuer as specified in its charter)
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2465 West 12th Street, Suite # 2, Tempe, AZ 85281-6935
(Address of Principal Executive Office) (Zip Code)
(480) 505-0070
(Issuer’s telephone number)
Check whether the registrant: (1) filed all reports required to be filed by Section 13 or 15(d) of the 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
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes X No
The number of outstanding shares of the registrant’s common stock, $0.001 par value (the only class of voting stock), as of August 14, 2006 was 40,703,265.
Yes No X
TABLE OF CONTENTS
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Part I. - Financial Information |
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| Item 1. Financial Statements | 3 | |||||
| 4 | ||||||
| 5 | ||||||
| 6 | ||||||
| 7 | ||||||
| 8 | ||||||
| Item 3. Controls and Procedures | 13 | |||||
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Part II. - Other Information |
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| Item 1. Legal Proceedings | 14 | |||||
| Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 14 | |||||
| Item 3. Defaults Upon Senior Securities | 15 | |||||
| Item 4. Submission of Matters to a Vote of Security Holders | 15 | |||||
| Item 5. Other Information | 15 | |||||
| Item 6. Exhibits | 15 | |||||
| Signatures | 16 | |||||
| Exhibits | 17 | |||||
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
As used herein the terms “Company,” “our,” “we,” and “us” refer to Asia4Sale.com, Inc., unless otherwise indicated. In the opinion of management, the accompanying unaudited financial statements included in this Form 10-QSB reflect all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of the results of operations for the periods presented. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year.
ASIA4SALE.COM, INC.
(A Development Stage Company)
Balance Sheets
ASSETS
June 30, December 31,
2006 2005
---------------------- -----------------------
---------------------- -----------------------
(Unaudited)
CURRENT ASSETS
Cash $ 9,665 $ 5,618
--- ------------------ ----------------------
Total Current Assets 9,665 5,618
--------------------- ----------------------
FIXED ASSETS
Equipment, Net 5,858 8,205
--------------------- ----------------------
Total Fixed Assets 5,858 8,205
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OTHER ASSETS
Other receivables 101,500 101,500
Equity investment 1,939,552 1,939,552
Other investments 6,480 -
Note receivable 900,000 -
Deposit 4,950 4,950
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Total Other Assets 2,952,482 2,046,002
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TOTAL ASSETS $ 2,968,005 $ 2,059,825
===================== ======================
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Accounts payable and accrued expenses $ 67,690 $ 478,578
Notes payable 984,382 -
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Total Current Liabilities 1,052,072 478,578
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STOCKHOLDERS' EQUITY (DEFICIT)
Common stock; 100,000,000 shares authorized,
at $0.001 par value, 40,703,265 and 32,401,920
shares issued and outstanding, respectively 40,703 32,402
Additional paid-in capital 2,762,400 2,250,641
Deficit accumulated prior to the development stage (1,200) (1,200)
Deficit accumulated during the development stage (885,970) (700,596)
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Total Stockholders' Equity (Deficit) 1,915,933 1,581,247
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TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ 2,968,005 $ 2,059,825
===================== ======================
The accompanying notes are an integral part of these financial statements.
ASIA4SALE.COM, INC.
(A Development Stage Company)
Statements of Operations (Unaudited)
From
Inception
For the Three For the Six on July 9,
Months Ended Months Ended 1999 Through
June 30, June 30, June 30,
------------------------------------ --------------------------------------
2006 2005 2006 2005 2006
--------------- ----------------- ----------------- ----------------- ----------------
REVENUES $ - $ - $ - $ - $ -
--- ----------- --- ------------- --- ------------- --- ------------- --- ------------
EXPENSES
General and administrative 120,818 10,479 180,680 33,800 988,549
Depreciation 2,347 2,110 4,694 4,220 72,490
--- ----------- --- ------------- --- ------------- --- ------------- --- ------------
Total Expenses 123,165 12,589 185,374 38,020 1,061,039
--- ----------- --- ------------- --- ------------- --- ------------- --- ------------
OTHER INCOME
Income from sale
of investments - - - - 65,084
Income (loss) from
equity investments - 338,852 - 253,612 1,018,907
Interest income - - - - 24,511
--- ----------- --- ------------- --- ------------- --- ------------- --- ------------
Total Other Income - 338,852 - 253,612 1,108,502
--- ----------- --- ------------- --- ------------- --- ------------- --- ------------
INCOME (LOSS) FROM CONTINUING OPERATIONS (123,165) 326,263 (185,374) 215,592 47,463
--- ----------- --- ------------- --- ------------- --- ------------- --- ------------
INCOME (LOSS) FROM DISCONTINUED OPERATIONS - - - (116,339) (933,433)
--- ----------- --- ------------- --- ------------- --- ------------- --- ------------
NET INCOME (LOSS) $ (123,165) $ 326,263 $ (185,374) $ 99,253 $ (885,970)
=== =========== === ============= === ============= === ============= === ============
BASIC INCOME (LOSS) PER SHARE $ (0.00) $ 0.01 $ (0.01) $ 0.00
=== =========== === ============= === ============= === =============
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING 36,552,593 32,401,920 35,169,035 32,401,920
=== =========== === ============= === ============= === =============
The accompanying notes are an integral part of these financial statements.
ASIA4SALE.COM, INC.
(A Development Stage Company)
Statements of Cash Flows (Unaudited)
From Inception
For the Six on July 9,
Months Ended 1999 Through
June 30, June 30,
-------------------------------------
2006 2005 2006
---------------- ----------------- ------------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ (185,374) $ 99,253 $ (885,970)
Adjustments to reconcile net loss to
net cash used by operating activities:
Discountinued operations - (69,980) 747,114
Depreciation expense 4,694 4,220 74,837
Gain on sale of investments - - (65,084)
Gain on equity investment - (253,612) (1,018,907)
Changes in operating assets and liabilities
(Increase) decrease in receivables - 282,819 (146,858)
Increase (decrease) in accounts payable and
accrued expenses (413,235) (61,243) 61,464
--- ------------ --- ------------- --- --------------
Net Cash Used by Operating Activities (593,915) 1,457 (1,233,404)
--- ------------ --- ------------- --- --------------
CASH FLOWS FROM INVESTING ACTIVITIES
Investment in subsidiaries - - (1,634,071)
Purchase of short-term investments (6,480) - (6,480)
Sale of investments - - 75,483
Purchase of fixed assets - (1,940) (78,348)
--- ------------ --- ------------- --- --------------
Net Cash Provided by (Used by)
Investing Activities (6,480) (1,940) (1,643,416)
--- ------------ --- ------------- --- --------------
CASH FLOWS FROM FINIANCING ACTIVITIES
Common stock issued for cash 520,060 - 2,800,618
Cash received on note payable 984,382 - 984,382
Cash paid on note receivable (900,000) - (900,000)
Capital contributed by shareholder - - 1,485
--- ------------ --- ------------- --- --------------
Net Cash Provided by Financing Activities 604,442 - 2,886,485
--- ------------ --- ------------- --- --------------
NET DECREASE IN CASH 4,047 (483) 9,665
CASH AT BEGINNING OF PERIOD 5,618 2,625 -
--- ------------ --- ------------- --- --------------
CASH AT END OF PERIOD $ 9,665 $ 2,142 $ 9,665
=== ============ === ============= === ==============
SUPPLIMENTAL DISCLOSURES OF CASH FLOW INFORMATION
CASH PAID FOR:
Interest $ - $ - $ -
Income Taxes $ - $ - $ -
The accompanying notes are an integral part of these financial statements.
ASIA4SALE.COM, INC.
(A Development Stage Company)
Notes to the Financial Statements
NOTE 1 - ORGANIZATION AND HISTORYThe financial statements presented are those of Asia4Sale.com, Inc. (the Company).
| The Company was incorporated under the laws of the State of Nevada on September 23, 1996. The Company ceased all operating activities during the period from September 23, 1996 to July 9, 1999 and was considered dormant. On July 9, 1999 the Company obtained a certificate of renewal from the State of Nevada. Since July 9, 1999, the Company has been in the development stage, and has not commenced planned principal operations. |
| The Company has no products or services as of June 30, 2006. The Company was organized primarily as a vehicle to seek merger or acquisition candidates. The Company’s primary focus is to seek out and consummate a merger with or acquisition of an existing operating entity. |
| The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company does not have significant cash or other current assets, nor does it have an established source of revenues sufficient to cover its operating costs and to allow it to continue as a going concern. The Company is seeking to merge with an existing operating company. |
| The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish its merger and/or acquisition strategy, and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern. |
| During the quarter ended June 30, 2006, the Company issued 8,301,345 shares of common stock for an aggregate of $520,060 in cash, at prices ranging from $0.06 to $0.08 per share. |
This Management’s Plan of Operation and Results of Operations and other parts of this report contain forward-looking statements that involve risks and uncertainties. Forward-looking statements can also be identified by words such as “anticipates,” “expects,” “believes,” “plans,” “predicts,” and similar terms. Forward-looking statements are not guarantees of future performance and our actual results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such differences include, but are not limited to, those discussed in the subsections entitled “Forward-Looking Statements and Factors That May Affect Future Results and Financial Condition” below. The following discussion should be read in conjunction with our financial statements and notes thereto included in this report. All information presented herein is based on our period ended June 30, 2006. Our fiscal year end is December 31.
The Company
The Company is a corporation, organized and existing under the laws of the State of Nevada, having been incorporated in September 1996 as “H&L Investments, Inc.” The name of the corporation was changed to “Asia4Sale.com, Inc.” on December 22, 1999.
We are not currently engaged in any active business other than the search for an operating business to acquire.
During June of 2000, the Company paid $970,000 to acquire 49% of World Wide Auctioneers, Inc., a Nevada registered corporation, holding 100% of a British Virgin Island registered company World Wide Auctioneers, Ltd. In August of 2003, World Wide Auctioneers, Inc., sold 100% of its subsidiary World Wide Auctioneers, Ltd., to a Nevada registered company WWA Group, Inc. (“WWA”), in a stock for stock transaction whereby WWA stock was issued directly to owners of World Wide Auctioneers, Inc., in exchange for ownership of World Wide Auctioneers, Ltd. The exchange caused the Company to acquire a minority equity investment in WWA which is accounted for using the equity method. WWA operates auctions of used, heavy construction equipment from Dubai, United Arab Emirates, and other locations.
Plan of Operation
The Company’s current focus is to seek out and consummate a merger with an existing operating entity. We intend to actively seek out and investigate possible business opportunities for the purpose of possibly acquiring or merging with one or more business ventures. We do not intend to limit our search to any particular industry or type of business. Management is continually investigating possible merger candidates and acquisition opportunities. However, management can provide no assurance that we will have the ability to acquire or merge with an operating business, business opportunity or property that will be of material value to us.
The Company anticipates that we will require only nominal capital to maintain our corporate viability, and necessary funds will most likely be provided by our officers and directors in the immediate future. However, unless we are able to facilitate an acquisition of or merger with an operating business or are able to obtain significant outside financing, there is substantial doubt about our ability to continue as a going concern.
The Company has not yet entered into any agreement, nor do we have any commitment or understanding to enter into or become engaged in any transaction, as of the date of this filing. Further, our directors will defer any compensation until such time as an acquisition or merger can be accomplished, and will strive to have the business opportunity provide their remuneration. As of the date hereof, we have not made any arrangements or definitive agreements to use outside advisors or consultants or to raise any additional capital.
We do not intend to use any employees, with the possible exception of part-time clerical assistance on an as-needed basis. Outside advisors or consultants will be used only if they can be obtained for minimal cost or on a deferred payment basis. Management is confident that it will be able to operate in this manner and to continue the search for business opportunities during the next twelve months.
Results of Operations
During the period ended June 30, 2006, the Company remained in the process of identifying a prospective business opportunity, which opportunity if acquired, may or may not produce revenue. Therefore, due to this uncertainty, we do not expect to generate any revenues until such time as a revenue producing acquisition is accomplished.
Net Losses
For the period from July 9, 1999 to June 30, 2006, the Company recorded a net loss of $885,970 which is primarily attributable to losses from the discontinuation of business operations and to general and administrative expenses from continuing operations. General and administrative expenses include accounting expenses, professional fees consulting fees, and costs associated with the preparation of disclosure documentation in connection with registration pursuant to the Securities Exchange Act of 1934, as amended.
During the three month period ended June 30, 2006, the Company recorded a net loss of $123,165 as compared to net income of $326,263 during the comparable 2005 period. During the six month period ended June 30, 2006, the Company recorded a net loss of $185,374 as compared to net income of $99,253 during the comparable 2005 period. Net losses in the current periods are primarily attributable to general and administrative expenses. During the comparable periods in 2005, the Company recognized significant gains on equity investments which were only partially offset by general and administrative expenses. The 2006 general and administrative expenses were primarily professional fees.
Since the Company does not anticipate generating any revenues in the near term we will continue to operate at a loss.
Capital Expenditures
The Company expended no amounts on capital expenditures for the period from July 9, 1999 (inception) to June 30, 2006.
Liquidity and Capital Resources
The Company is in the development stage and, since inception, has experienced significant changes in liquidity, capital resources and shareholders’ equity. The Company had current assets of $9,665, consisting solely of cash on hand, and current and total liabilities of $1,052,072, as of June 30, 2006. Additionally, we have assets consisting primarily of investments totaling $1,939,552 related to our minority interest in WWA. Net stockholders’ equity in the Company was $1,915,933 at June 30, 2006.
We are holding our shares of WWA as an equity investment. The shares are restricted common stock in a publicly traded company. As the market allows and in accordance with the limits of Rule 144, we intend to sell all or part of the shares as a source of operating funds. Any sales proceeds may be used to fund payment of ongoing expenses.
During the three months ended June 30, 2006, our expenses were paid with funds received primarily from the sale of common shares.
The Company’s current assets are only sufficient to sustain operations for 90 days or less. We need to raise approximately $150,000 in additional cash to sustain operations for the next 12 months. Other than the sales of shares of WWA, we have no current commitments or arrangements with respect to funding nor do we have immediate sources of funding. Further, no assurances can be given that any additionally funding would be available to us on acceptable terms if at all. Although our major shareholders would be the most likely source of new funding in the form of loans or equity placements, none have made any commitment for future investment and the Company has no agreement formal or otherwise. The Company’s inability to obtain additional funding, if required, would have a material adverse affect on our plan of operation.
The Company has no current plans for the purchase or sale of any plant or equipment.
The Company has no current plans to make any changes in the number of employees.
Inflation
In the opinion of management, inflation has not and will not have a material effect on our operations until such time as we successfully complete an acquisition or merger. At that time, management will evaluate the possible effects of inflation on our business and operations.
Net Operating Loss Carryforwards
We have accumulated approximately $1,650,000 of net operating loss carryforwards as of June 30, 2006. This loss carryforward may be offset against taxable income and income taxes in future years and expires in the year 2026. The use of these losses to reduce future income taxes will depend on the generation of sufficient taxable income prior to the expiration of the net operating loss carryforwards. In the event of certain changes in control, there will be an annual limitation on the amount of net operating loss carryforwards which can be used. No tax benefit has been reported in the financial statements as of June 30, 2006 because it has been fully offset by a valuation reserve. The use of future tax benefit is undeterminable because we presently have no operations.
Forward Looking Statements and Factors that May Affect Future Results and Financial Condition
The statements contained in the section titled “Plan of Operation”, with the exception of historical facts, are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which reflect our current expectations and beliefs regarding our future results of operations, performance, and achievements. These statements are subject to risks and uncertainties and are based upon assumptions and beliefs that may or may not materialize. These forward looking statements include, but are not limited to, statements concerning:
o our ability to search for an appropriate business opportunity and to subsequently acquire or merge with such entity;
o the sufficiency of existing capital resources to meet our cash and working capital needs;
o our ability to raise additional capital to fund cash requirements for future operations;
o our ability to maintain our corporate existence as a viable entity;
o the volatility of the stock market; and
o general economic conditions.
We wish to caution readers that the Company’s operating results are subject to various risks and uncertainties that could cause our actual results to differ materially from those discussed or anticipated in this report. We also wish to advise readers not to place any undue reliance on the forward looking statements contained in this report, which reflect our beliefs and expectations only as of the date of this report. We assume no obligation to update or revise these forward looking statements to reflect new events or circumstances or any changes in our beliefs or expectations, other than is required by law.
Risks Factors
Our future operating results are highly uncertain. Before deciding to invest in us or to maintain or increase your investment, you should carefully consider the risks described below, in addition to the other information contained in this annual report. If any of these risks actually occur, our business, financial condition or results of operations could be seriously harmed. In that event, the market price for our common stock could decline and you may lose all or part of your investment.
We have a history of significant operating losses and such losses may continue in the future.
Since our inception in 1996, our expenses have substantially exceeded our income, resulting in continuing losses and an accumulated deficit during our development stage of $885,970 at June 30, 2006. During the three months ended June 30, 2006, we recorded a net loss of $123,165. Though the Company has a historical income from the sale of investments, interest, and equity investments, we have never realized revenue from operations. We will continue to incur operating losses as we maintain our search for a suitable business opportunity and satisfy our ongoing disclosure requirements with the Securities and Exchange Commission (“Commission”). Our only expectation of future profitability is dependent upon our ability to acquire a revenue producing business opportunity, which acquisition can in no way be assured. Therefore, we may never be able to achieve profitability.
The Company’s limited financial resources cast severe doubt on our ability to acquire a profitable business opportunity.
The Company’s future operation is dependent upon the acquisition of a profitable business opportunity. However, the prospect of such an acquisition is doubtful due to the Company’s limited financial resources and current assets of only $9,665. Since we have no current business opportunity, the Company is not in a position to improve this financial condition through debt or equity offerings. Therefore, this limitation may act as a deterrent in future negotiations with prospective acquisition candidates. Should we be unable to acquire a profitable business opportunity the Company will, in all likelihood, be forced to cease operations.
The market for our stock is limited and our stock price may be volatile.
The market for our common stock has been limited due to low trading volume and the small number of brokerage firms acting as market makers. Because of the limitations of our market and volatility of the market price of our stock, investors may face difficulties in selling shares at attractive prices when they want to. The average daily trading volume for our stock has varied significantly from week to week and from month to month, and the trading volume often varies widely from day to day.
We may incur significant expenses as a result of being quoted on the Over the Counter Bulletin Board, which may negatively impact our financial performance.
We may incur significant legal, accounting and other expenses as a result of being listed on the Over the Counter Bulletin Board. The Sarbanes-Oxley Act of 2002, as well as related rules implemented by the Commission has required changes in corporate governance practices of public companies. We expect that compliance with these laws, rules and regulations, including compliance with Section 404 of the Sarbanes-Oxley Act of 2002 as discussed in the following risk factor, may substantially increase our expenses, including our legal and accounting costs, and make some activities more time-consuming and costly. As a result, there may be a substantial increase in legal, accounting and certain other expenses in the future, which would negatively impact our financial performance and could have a material adverse effect on our results of operations and financial condition.
Our internal controls over financial reporting may not be considered effective, which could result in a loss of investor confidence in our financial reports and in turn have an adverse effect on our stock price.
Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, beginning with our annual report for the year ending December 31, 2007, we may be required to furnish a report by our management on our internal controls over financial reporting. Such report will contain, among other matters, an assessment of the effectiveness of our internal controls over financial reporting as of the end of the year, including a statement as to whether or not our internal controls over financial reporting are effective. This assessment must include disclosure of any material weaknesses in our internal controls over financial reporting identified by management. The report will also contain a statement that our independent registered public accounting firm has issued an attestation report on management’s assessment of internal controls. If we are unable to assert that our internal controls are effective as of December 31, 2007, or if our independent registered public accounting firm is unable to attest that our management’s report is fairly stated or they are unable to express an opinion on our management’s evaluation or on the effectiveness of our internal controls, investors could lose confidence in the accuracy and completeness of our financial reports, which in turn could cause our stock price to decline.
Critical Accounting Policies
In the notes to the audited financial statements for the year ended December 31, 2005, included in the Company’ Form 10-KSB, the Company discusses those accounting policies that are considered to be significant in determining the results of operations and our financial position. The Company believes that the accounting principles we utilized conform to accounting principles generally accepted in the United States of America.
The preparation of financial statements requires Company management to make significant estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. By their nature, these judgments are subject to an inherent degree of uncertainty. On an on-going basis, the Company evaluates estimates. We base our estimates on historical experience and other facts and circumstances that are believed to be reasonable, and the results form the basis for making judgments about the carrying value of assets and liabilities. The actual results may differ from these estimates under different assumptions or conditions.
Going Concern
The Company’s audit expressed substantial doubt as to the Company’s ability to continue as a going concern as a result of recurring losses, lack of revenue-generating activities and an accumulated deficit of $700,596 as of December 31, 2005, which increased to $885,970 as of June 30, 2006. The Company’s ability to continue as a going concern is subject to the ability of the Company to realize a profit from operations and/or obtain funding from outside sources. Since the Company has no revenue generating operations, our plan to address the Company’s ability to continue as a going concern over the next twelve months includes: (1) obtaining additional funding from the sale of our securities; and (2) obtaining loans where possible. Although we believe that we will be able to obtain the necessary funding to allow us to remain a going concern through the methods discussed above, there can be no assurances that such methods will prove successful.
ITEM 3. CONTROLS AND PROCEDURES.The Company’s president acts both as the Company’s chief executive officer and chief financial officer and is responsible for establishing and maintaining disclosure controls and procedures for the Company.
(a) Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of June 30, 2006. Based on this evaluation, our principal executive officer and our principal financial officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective and adequately designed to ensure that the information required to be disclosed by us in the reports we submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the applicable rules and forms and that such information was accumulated and communicated to our chief executive officer and chief financial officer, in a manner that allowed for timely decisions regarding disclosure.
(b) Changes in Internal Controls
During the period ended June 30, 2006, there has been no change in internal control over financial reporting that has materially affected, or is reasonably likely to materially affect our internal control over financial reporting.
PART II – OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGSNone.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDSDuring the three month period ended June 30, 2006, the Company authorized the issuance of 92,500 shares to common stock to Eric Montandon valued at $0.08 per share for cash consideration of $7,400 in the form of debt, relying on exemptions provided by Section 4(2) of the Securities Act of 1933, as amended.
The Company made this offering based on the following factors: (1) the issuance was an isolated private transaction by the Company which did not involve a public offering; (2) there was only one offeree who is an officer and director of the Company that was issued the Company’s stock in satisfaction of debt; (3) the offeree stated an intention not to resell the stock; (4) there were no subsequent or contemporaneous public offerings of the warrants; and (5) the negotiations that lead to the issuance of the warrants took place directly between the offeree and the Company.
During the three month period ended June 30, 2006, the Company authorized the issuance of 8,208,845 shares of common stock to certain individuals and entities valued between $0.06, $0.08 per share for cash consideration of $520,060, relying on exemptions provided by Regulation S of the Securities Act of 1933, as amended.
Regulation S provides generally that any offer or sale that occurs outside of the United States is exempt from the registration requirements of the Securities Act, provided that certain conditions are met. Regulation S has two safe harbors. One safe harbor applies to offers and sales by issuers, securities professionals involved in the distribution process pursuant to contract, their respective affiliates, and persons acting on behalf of any of the foregoing (the “issuer safe harbor”), and the other applies to resales by persons other than the issuer, securities professionals involved in the distribution process pursuant to contract, their respective affiliates (except certain officers and directors), and persons acting on behalf of any of the forgoing (the “resale safe harbor”). An offer, sale or resale of securities that satisfied all conditions of the applicable safe harbor is deemed to be outside the United States as required by Regulation S. The distribution compliance period for shares sold in reliance on Regulation S is one year.
The Company complied with the requirements of Regulation S for all of the above issuances by having no directed selling efforts made in the United States, by selling only to offerees who were outside the United States at the time of the offering, and ensuring that the entities to whom the stock were issued were non-U.S. persons with addresses in foreign countries.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERSNone.
ITEM 5. OTHER INFORMATIONNone.
ITEM 6. EXHIBITSExhibits required to be attached by Item 601 of Regulation S-B are listed in the Index to Exhibits on page 16 of this Form 10-QSB, and are incorporated herein by this reference.
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Asia4Sale.com, Inc.
Date: August 14, 2006 By: /s/ Eric Montandon
Eric Montandon
Chief Executive Officer, Chief Financial Officer and Principal Accounting Officer
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Exhibit No. |
Page No. |
Description |
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3(i) |
* |
Articles of Incorporation of the Company (incorporated by reference to the Form 10-12G filed with the Commission on October 20, 1999). |
|
3(ii) |
* |
By-laws of the Company (incorporated by reference to the Form 10-12G filed with the Commission on October 20, 1999). |
|
31 |
Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14 of the Securities and Exchange Act of 1934 as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
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32 |
Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |