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, 2004

                                       OR

|_|   Transition report pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934 For the transition period from _______________ to
      _______________


                         Commission File Number: 0-27653

                                PACIFIC CMA, INC.
      ---------------------------------------------------------------------
        (Exact Name of Small Business Issuer as Specified in Its Charter)

             Delaware                                           84-1435073
 -----------------------------------------------------------------------------
 (State or Other Jurisdiction of                            (I.R.S. Employer
   Incorporation or Organization)                           Identification No.)

        350 Avenue of the Americas, Suite 3100, New York, New York 10019
  -----------------------------------------------------------------------------
                    (Address of Principal Executive Offices)

                                 (212) 247-0049
  -----------------------------------------------------------------------------
                (Issuer's Telephone Number, Including Area Code)

Check  whether  the Issuer:  (1) has filed all  reports  required to be filed by
Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 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 |_|


The number of shares  outstanding of the Registrant's  Common Stock, as of March
31, 2004, was 25,825,590 shares.

   Transitional Small Business Disclosure Format (Check One): Yes |_|  No |X|


<PAGE>


                                PACIFIC CMA, INC.

                              INDEX TO FORM 10-QSB

<TABLE>
<CAPTION>
<S>                                                                                                          <C>
                                                                                                             PAGE
PART I.     FINANCIAL INFORMATION

ITEM 1.     FINANCIAL STATEMENTS

      Consolidated Balance Sheets as of March 31, 2004 (Unaudited)
        and December 31, 2003 (Audited)

      Consolidated Unaudited Statements of Operations for the Three Months
        Ended March 31, 2004 and 2003

      Consolidated Unaudited Statement of Stockholders' Equity for the Three Months
        Ended March 31, 2004

      Consolidated Unaudited Statements of Cash Flows for the Three Months
        Ended March 31, 2004 and 2003

      Notes to Consolidated Unaudited Financial Statements

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS

ITEM 3.   CONTROLS AND PROCEDURES


PART II.  OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

ITEM 2.   CHANGES IN SECURITIES, USE OF PROCEEDS AND ISSUER PURCHASERS OF EQUITY SECURITIES

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES

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

ITEM 5.   OTHER INFORMATION

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K


SIGNATURES
</TABLE>


<PAGE>



                                     PART I
                              FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                                PACIFIC CMA, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                      MARCH 31, 2004 AND DECEMBER 31, 2003

<TABLE>
<CAPTION>
ASSETS

                                                                                         2004              2003
                                                                                   --------------    --------------
                                                                                      (UNAUDITED)
<S>                                                                                <C>               <C>
    CURRENT ASSETS
        Cash and cash equivalents                                                  $      752,542    $      912,240
        Restricted cash                                                                 5,790,328         5,786,064
        Accounts receivable, net of allowance for doubtful accounts of
          $156,617 for both periods                                                     7,402,985         7,360,859
        Refundable income taxes                                                           339,295           147,092
        Deposits, prepayments and other assets                                          3,087,102         2,155,482
                                                                                   --------------    --------------
               Total current assets                                                    17,372,252        16,361,737
                                                                                   --------------    --------------

    PROPERTY AND EQUIPMENT, net of accumulated depreciation of $750,005
       and $641,838                                                                       349,901           241,186
                                                                                   --------------    --------------

    OTHER ASSETS
        Goodwill                                                                        2,683,768         2,683,768
        Intangible assets, net of accumulated amortization of
          $1,096,333 and $953,333                                                       1,763,667         1,906,667
        Investment deposit                                                              1,096,054           900,900
        Other                                                                             275,155           293,022
                                                                                   --------------    --------------
                                                                                        5,818,644         5,784,357
                                                                                   --------------    --------------

                                                                                   $   23,540,797    $   22,387,280
                                                                                   ==============    ==============

LIABILITIES AND STOCKHOLDERS' EQUITY

    CURRENT LIABILITIES
        Notes payable - bank                                                       $    7,644,819    $    6,008,594
        Current maturities of long-term debt                                               34,912            26,851
        Accounts payable                                                                7,229,261         7,319,281
        Accrued expenses and other                                                        425,160           618,852
        Short-term loans payable                                                          305,788           537,510
                                                                                   --------------    --------------
               Total current liabilities                                               15,639,940        14,511,088
                                                                                   --------------    --------------

    LONG-TERM DEBT                                                                         39,376            21,592
                                                                                   --------------    --------------
</TABLE>


<PAGE>



<TABLE>
<CAPTION>
<S>                                                                                 <C>               <C>
    STOCKHOLDERS' EQUITY
        Common stock, no par value                                                      6,418,242         6,195,492
        Additional paid-in capital                                                      1,786,718         1,786,718
        Retained earnings                                                               2,310,627         2,433,420
        Accumulated other comprehensive income                                             11,440            11,440
        Unearned compensation cost                                                     (2,665,546)       (2,572,470)
                                                                                   --------------    --------------
               Total stockholders' equity                                               7,861,481         7,854,600
                                                                                   --------------    --------------

                                                                                   $   23,540,797    $   22,387,280
                                                                                   ==============    ==============
</TABLE>


                                       4
<PAGE>


                                PACIFIC CMA, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                   THREE MONTHS ENDED MARCH 31, 2004 AND 2003
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                        2004              2003
                                                                                   --------------    --------------
<S>                                                                                <C>               <C>
    FREIGHT FORWARDING INCOME                                                      $   16,454,513    $   14,026,380
                                                                                   --------------    --------------

    OPERATING EXPENSES
        Cost of forwarding                                                            (13,791,615)      (11,693,998)
        General and administrative                                                     (2,584,653)       (2,288,344)
        Stock-based compensation cost                                                    (166,423)          (17,656)
        Depreciation and amortization                                                    (179,700)         (193,101)
                                                                                   --------------    --------------

                                                                                                        (16,722,391)

    OPERATING LOSS                                                                       (267,878)         (166,719)
                                                                                   --------------    --------------

    OTHER INCOME (EXPENSE)
        Interest and other income                                                          95,778            47,500
        Interest expense                                                                  (89,527)          (43,726)
                                                                                   --------------    --------------
                                                                                            6,251             3,774
                                                                                   --------------    --------------

    LOSS BEFORE INCOME TAXES                                                             (261,627)         (162,945)

    BENEFIT FOR INCOME TAXES                                                             (138,834)          (54,972)
                                                                                   --------------    --------------

    NET LOSS                                                                       $     (122,793)   $     (107,973)
                                                                                   ==============    ==============

    BASIC EARNINGS PER SHARE                                                       $       (0.005)   $       (0.005)
                                                                                   ==============    ==============

    DILUTED EARNINGS PER SHARE                                                     $       (0.005)   $       (0.005)
                                                                                   ==============    ==============
</TABLE>



                                       5
<PAGE>




                                PACIFIC CMA, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                   THREE MONTHS ENDED MARCH 31, 2004 AND 2003
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                        2004              2003
                                                                                   --------------    --------------
<S>                                                                                <C>               <C>
OPERATING ACTIVITIES
    Net loss                                                                       $     (122,793)   $     (107,973)
    Items not requiring (providing) cash
       Depreciation and amortization                                                      179,700           193,101
       (Gain) loss on sale of property and equipment                                       (4,406)            9,829
       Stock based compensation cost                                                      166,423            17,656
    Changes in
       Accounts receivable                                                                (42,126)          616,582
       Deposits, prepayments and other                                                   (950,500)         (708,790)
       Accounts payable                                                                   (90,019)         (954,245)
       Accrued expenses                                                                  (193,695)         (264,700)
       Income taxes refundable/payable                                                   (192,203)          (52,471)
                                                                                   --------------    --------------
           Net cash used in operating activities                                       (1,249,619)       (1,251,011)
                                                                                   --------------    --------------

INVESTING ACTIVITIES
    Loans receivable                                                                           --            23,283
    Purchase of property and equipment                                                   (116,366)          (25,694)
    Proceeds from sale of subsidiary                                                           --            66,346
    Proceeds from sale of property and equipment                                            7,915            10,897
    Investment deposit                                                                   (195,154)               --
                                                                                   --------------    --------------
           Net cash provided by (used in) investing activities                           (303,605)           74,832
                                                                                   --------------    --------------

FINANCING ACTIVITIES
    Net change in restricted cash                                                          (4,264)         (373,008)
    Net change in notes payable - bank                                                  1,636,225         1,944,675
    Installments paid on acquisition of subsidiary                                             --          (300,000)
    Principal payments under capital lease obligation                                      (6,713)          (22,176)
    Proceeds from short-term debt                                                              --            64,103
    Payments on short-term debt                                                          (231,722)          (29,484)
    Advances to a director, net                                                                --            67,596
                                                                                   --------------    --------------
           Net cash provided by financing activities                                    1,393,526         1,351,706
                                                                                   --------------    --------------

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                         (159,698)          175,527

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR                                              912,240           441,657
                                                                                   --------------    --------------

CASH AND CASH EQUIVALENTS, END OF YEAR                                             $      752,542    $      617,184
                                                                                   ==============    ==============
</TABLE>


<PAGE>



                                PACIFIC CMA, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                             MARCH 31, 2004 AND 2003


NOTE 1: BASIS OF PRESENTATION

        The accompanying  unaudited condensed  consolidated financial statements
        of Pacific CMA, Inc. (the "Company") and its subsidiaries  (the "Group")
        as of March 31, 2004 and for the three  months  ended March 31, 2004 and
        2003  have  been  prepared  in  accordance  with  accounting  principles
        generally accepted in the United States of America for interim financial
        information  and with the  instructions to Form 10-QSB and Article 10 of
        Regulation S-X of the Securities Exchange Act of 1934. Accordingly, they
        do  not  include  all of  the  information  and  footnotes  required  by
        accounting principles generally accepted in the United States of America
        for complete financial statements.  The accompanying unaudited condensed
        consolidated  financial  statements  reflect all adjustments that are in
        the opinion of the Company's management, necessary to fairly present the
        financial position, results of operations and cash flows of the Company.
        Those adjustments consist only of normal recurring adjustments.

        The condensed  consolidated  balance sheet of the Company as of December
        31, 2003 has been derived from the audited consolidated balance sheet of
        the Company as of that date.

        The condensed  consolidated statement of operations for the three months
        ended March 31, 2004 and 2003, and cash flows for the three months ended
        March 31, 2004 and 2003 are not  necessarily  indicative  of the results
        that may be expected for the entire year.  These condensed  consolidated
        financial statements should be read in conjunction with the consolidated
        financial  statements  and the related  notes thereto for the year ended
        December 31, 2003 included in the  Company's  Form 10-KSB filed on March
        30, 2004.


    PRINCIPLES OF CONSOLIDATION

        The condensed  consolidated  financial  statements include the financial
        statements  of  the  Company  and  its  subsidiaries.   All  significant
        intercompany   balances  and   transactions   have  been  eliminated  in
        consolidation.


<PAGE>


                                PACIFIC CMA, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                             MARCH 31, 2004 AND 2003


NOTE 2:  EARNINGS PER SHARE

The followings is a reconciliation of the numerator and denominator of basic and
diluted earnings per share

<TABLE>
<CAPTION>
                                                  2004                                      2003
                                                             PER-SHARE                                 PER-SHARE
                                    LOSS         SHARES        AMOUNT         LOSS         SHARES        AMOUNT
--------------------------------------------------------------------------------------------------------------------
<S>                              <C>                         <C>           <C>            <C>          <C>
      NET LOSS                   $  (122,793)           --   $        --   $  (107,973)           --   $        --

      BASIC EPS
        Loss available to
          common stockholders       (122,793)   25,682,733        (0.005)     (107,973)   22,594,588       (0.005)
      DILUTED EPS
        Income available to
          common stockholders
          and assumed
          conversions               (122,793)   25,682,733        (0.005)     (107,973)   22,594,588       (0.005)
</TABLE>


        Common  stock  equivalents  related to stock  options  and  warrants  of
        200,000 and 1,007,455, respectively, are not included in the calculation
        of  dilutive  earnings  per share  because  they  have an  anti-dilutive
        effect.

NOTE 3: COMMON STOCK AND PREFERRED STOCK

        As of March 31, 2004, the Company's  authorized  capital stock comprised
        of 100,000,000  shares of common stock,  $0.001 par value and 10,000,000
        shares of preferred  stock,  $0.001 par value.  As of the same date, the
        Company's  issued and outstanding  capital stock comprised of 25,825,590
        shares of common stock and no shares of preferred stock.


                                       8
<PAGE>


                                PACIFIC CMA, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                             MARCH 31, 2004 AND 2003

    OTHER STOCK GRANTS

        In March 2004, the Company  entered into a service  agreement with a key
        employee. Under the terms of the agreements,  the Company granted to the
        employee 100,000  restricted shares. The shares are then registered with
        the SEC by filing form S-8 on March 29, 2004. The agreement requires the
        employee to continue to provide  services to the Company from January 1,
        2004 through  December 31,  2008.  Compensation  cost is measured at the
        grant date based on the estimated fair value of the  restricted  shares.
        The  compensation  cost is recognized as expense over the service period
        required under the agreements.  The unearned portion of the compensation
        cost is recorded in equity as unearned compensation cost. The Company is
        holding the stock  certificates  pending the  completion  of the service
        agreements.

        Also in March 2004,  the Company issued 50,000 shares of common stock to
        a business advisor.  The Company recorded an expense of $57,750 which is
        the estimated fair value of the stock on the grant date.

        On April 14, 2004, the Company sold to the Investors  $3,000,000  stated
        amount of its Series A Preferred  Stock and issued to two  institutional
        investors  warrants to purchase  937,500 shares of common stock,  at per
        share exercise  prices of $1.76 for 468,750 shares and $2.00 for 468,750
        shares.  These investors have a 180-day option to purchase an additional
        $2,000,000  of  Preferred  Stock  and  Warrants  on the same  terms  and
        conditions as the initial $3,000,000 investment.

        On May 6, 2004, the Company sold to an institutional investor $2,000,000
        of its Series A  Preferred  Stock and issued  warrants  to  purchase  an
        additional  625,000 shares of common stock at per share exercise  prices
        of $1.76 for 312,500 shares and $2.00 for 312,500 shares.  This investor
        has a 180-day  option to purchase an additional  $2,000,000 of Preferred
        Stock  on the  same  terms  and  conditions  as the  initial  $2,000,000
        investment.

        The  Preferred  Stock  has a  stated  value  of  $1,000  per  share,  is
        convertible  into shares of Common Stock at a conversion  price of $1.44
        per share and pays an annual  dividend  equal to six (6%) percent of the
        stated value of the Preferred Stock outstanding,  which at the option of
        the  Company,  subject to certain  conditions,  may be paid in shares of
        Common Stock.

NOTE 4: PLEDGE OF ASSETS

        As of March 31, 2004, the Group had pledged the following assets:

(a)     Restricted cash deposits of $5,790,328.

(b)     Shares in Airgate acquired in 2002 (representing 81% controlling
        interest) to the sellers in respect of the consideration payable to them
        for the acquisition of Airgate.


                                       9
<PAGE>













                                       10




<PAGE>

                                PACIFIC CMA, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                             MARCH 31, 2004 AND 2003


NOTE 5: NOTES PAYABLE - BANK

        The Company has a $2,500,000 line of credit that accrues interest at the
        bank's  prime rate plus 0.75%  (4.75% at March 31,  2004) and matures in
        September 2004. The line is collateralized  by a $1,500,000  certificate
        of deposit held by the Bank, substantially all the assets of Airgate and
        a personal  guarantee of a director of the Company.  This certificate of
        deposit is recorded as  restricted  cash.  The note requires the Company
        meet certain debt to equity ratios and other financial covenants.  As of
        March 31, 2004,  the Company is not in compliance  with certain of these
        covenants.  As of March 31, 2004, there was $2,500,000  borrowed against
        this facility.

        The Company has certain other banking  facilities to finance its working
        capital. The facilities available totaled approximately $7,000,000.  The
        facilities  accrue interest at rates varying with the prime rate in Hong
        Kong,  Hong Kong  Interbank  Offered Rate (HIBOR),  or the cost of funds
        rate.  As of March 31, 2004,  these rates ranged  between 1.01% - 7.00%.
        The  facilities  require  annual  renewals  and  are  collateralized  by
        personal   guarantees   by  two  directors   and   restricted   cash  of
        approximately  $4,000,000.  As of March 31, 2004 and  December 31, 2003,
        amounts   outstanding   against  these  facilities  was  $5,144,819  and
        $3,508,594, respectively.

NOTE 6: RELATED PARTY TRANSACTIONS

        As  of  March  31, 2004  and  December  31, 2003,  the  Company  had the
following balances with related parties:

                                                  2004             2003
                                             --------------   --------------

Payable to Alfred Lam, CEO                   $        8,702   $       20,493
                                             ==============   ==============


        There were no material related party transactions for the quarters ended
March 31, 2004 and 2003.



NOTE 7: SEGMENT OF THE BUSINESS


    BUSINESS SEGMENTS

        The Company operates mainly in two business segments. Those segments are
        air  forwarding  and sea forwarding  services.  The accounting  policies
        adopted by the  Company  for  segment  reporting  are  described  in the
        summary of significant  accounting policies in the Company's Form 10-KSB
        filed for the year ended December 31, 2003.


                                       11
<PAGE>


                                PACIFIC CMA, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                             MARCH 31, 2004 AND 2003


        The following  table  summarized the Company's  operations for the three
        months  ended  March  31,  2004  and 2003  analyzed  into  air,  and sea
        forwarding services:

<TABLE>
<CAPTION>
                                        AIR FORWARDING               SEA FORWARDING                  TOTAL
                                      2004          2003           2004          2003          2004          2003
                         ---------------------------------------------------------------------------------------------
<S>                      <C>             <C>             <C>             <C>             <C>             <C>
Revenue                  $ 10,562,831    $  9,054,673    $  5,891,682    $  4,971,707    $ 16,454,513    $ 14,026,380
Cost of forwarding         (8,648,218)     (7,523,794)     (5,143,397)     (4,170,204)    (13,791,615)    (11,693,998)
Depreciation and
   amortization              (121,360)       (119,411)        (43,291)        (47,420)       (164,651)       (166,831)
Interest expense              (37,640)        (26,606)         (6,763)           (964)        (44,403)        (27,570)
Other segment expenses
   attributable to
   segment                   (692,099)       (547,778)       (357,290)       (261,012)     (1,049,389)       (808,790)
                         ------------    ------------    ------------    ------------    ------------    ------------


Segment income           $  1,063,514    $    837,084    $    340,941    $    492,107       1,404,455       1,329,191
                                                         ============    ============    ============    ============
Net other unallocated
   expenses                                                                                (1,527,248)     (1,437,164)
                                                                                         ------------    ------------


Net loss                                                                                 $   (122,793)   $   (107,973)
                                                                                         ============    ============


Goodwill                 $  2,012,826    $  2,012,826    $    670,942    $    670,942    $  2,683,768    $  2,683,768
Intangible assets           1,322,750       1,751,750         440,917         583,917       1,763,667       2,335,667
Other assets               14,359,191       9,506,121       4,734,171       2,508,451      19,093,362      12,014,572
                         ------------    ------------    ------------    ------------    ------------    ------------


       Total assets      $ 17,694,767    $ 13,270,697    $  5,846,030    $  3,763,310    $ 23,540,797    $ 17,034,007
                         ============    ============    ============    ============    ============    ============
</TABLE>



    GEOGRAPHICAL SEGMENTS

        The table below  summarized  the Group's  turnover  for the three months
        ended March 31, 2004 and 2003 analyzed into geographical locations:


                                                        2004          2003
                                                    -----------   -----------
            Turnover
                * IATA Area 1                       $ 1,748,707   $ 1,831,939
                * IATA Area 2                         3,939,955     1,045,677
                * IATA Area 3                        10,765,851    11,148,764
                                                    -----------   -----------

                   Total                            $16,454,513   $14,026,380
                                                    ===========   ===========


                                       12
<PAGE>


                                PACIFIC CMA, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                             MARCH 31, 2004 AND 2003

<TABLE>
<CAPTION>
                                                 (UNAUDITED)                                    (UNAUDITED)
                                          AS OF MARCH 31, 2004                              AS OF MARCH 31, 2003
                                                OTHER ASSETS                                   OTHER ASSETS
                                   TRADE         (INCLUDING        TOTAL          TRADE          (INCLUDING          TOTAL
                                RECEIVABLES       GOODWILL)        ASSETS       RECEIVABLES       GOODWILL)          ASSETS
                               -----------------------------------------------------------------------------------------------
<S>                            <C>            <C>                <C>            <C>            <C>                <C>
             Assets
               *IATA Area 1    $ 5,559,496    $     6,151,574    $11,711,070    $ 4,265,577    $     6,241,660    $10,507,237
               *IATA Area 2        290,235                 --        290,235        173,670                 --        173,670
               *IATA Area 3      1,553,254          9,986,238     11,539,492      1,408,311          4,944,789      6,353,100
                               -----------    ---------------    -----------    -----------    ---------------    -----------
                    Total      $ 7,402,985    $    16,137,812    $23,540,797    $ 5,847,558    $    11,186,449    $17,034,007
                               ===========    ===============    ===========    ===========    ===============    ===========
</TABLE>

        *IATA Area 1 comprises all of the North and South American Continent and
        adjacent islands, Greenland, Bermuda, West Indies and the islands of the
        Caribbean Sea, the Hawaiian Islands (including Midway and Palamyra).

        IATA Area 2 comprises all of Europe  (including the European part of the
        Russian Federation) and the adjacent islands,  Iceland,  the Azores, all
        of Africa and the adjacent islands,  Ascension Island, that part of Asia
        lying west of and including Iran (Islamic Rep. 6f).

        IATA Area 3 comprises all of Asia and the adjacent islands,  except that
        portion included in IATA Area 2, all of the East Indies,  Australia, New
        Zealand and the  adjacent  islands,  the  islands of the Pacific  Ocean,
        except those included in IATA Area 1.

NOTE 8: CONCENTRATIONS

        For the quarters  ended,  March 31, 2004 and 2003, the Company had sales
        to two major  customers  (defined as customers who represent 10% or more
        of total  sales).  Sales to these  customers as a percent of total sales
        are as follows:

               MAJOR CUSTOMER                              2004        2003
--------------------------------------------------------------------------------

           A                                                13%         12%
           B                                                 8%         12%


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS


                                       13
<PAGE>


SPECIAL NOTE OF CAUTION REGARDING FORWARD-LOOKING STATEMENTS

         Certain  statements  in  this  report,   including  statements  in  the
following discussion,  which are not statements of historical fact, are what are
known as "forward-looking statements",  which are basically statements about the
future. For that reason,  these statements involve risk and uncertainty since no
one can accurately predict the future. Words such as "plans", "intends", "will",
"hopes",  "seeks",  "anticipates",  "expects", and the like, often identify such
forward-looking  statements, but are not the only indication that a statement is
a forward-looking  statement. Such forward-looking statements include statements
concerning  our plans and  objectives  with  respect to the  present  and future
operations of Pacific CMA, Inc. (herein the "Company," "Registrant," "us," "we,"
"our" and  similar  terms)  and  statements,  which  express  or imply that such
present and future operations will, or may, produce revenues, income or profits.
Numerous  factors and future events could cause  Registrant to change such plans
and  objectives,  or fail to  successfully  implement such plans or achieve such
objectives,  or cause  such  present  and future  operations  to fail to produce
revenues, income or profits.

         These  forward-looking  statements  are based  largely  on our  current
expectations, assumptions, plans, estimates, judgments and projections about our
business and our industry,  and they involve  inherent risks and  uncertainties.
Although  we  believe  that  these  forward-looking  statements  are based  upon
reasonable estimates,  judgments and assumptions,  we can give no assurance that
our  expectations  will in  fact  occur  or that  our  estimates,  judgments  or
assumptions  will be  correct,  and we caution  that  actual  results may differ
materially  and  adversely  from  those  in  the   forward-looking   statements.
Forward-looking  statements  involve  known and  unknown  risks,  uncertainties,
contingencies  and other factors that could cause our or our  industry's  actual
results, level of activity, performance or achievement to differ materially from
those  discussed in or implied by any  forward-looking  statements made by or on
behalf of us and could cause our financial  condition,  results of operations or
cash flows to be materially adversely affected.  Accordingly,  investors and all
others  are  cautioned  not to  place  undue  reliance  on such  forward-looking
statements.

         Potential risks, uncertainties, and other factors which could cause the
Company's  financial  performance or results of operations to differ  materially
from current  expectations or such  forward-looking  statements include, but are
not limited to:

      -     International economic and political risks, over which we have
            little or no control;

      -     Political uncertainty in Hong Kong and China making it difficult to
            develop any long range planning;

      -     Relations between the United States and China remaining stable;

      -     The Chinese government could change its policies toward private
            enterprises or expropriate private enterprises;

      -     The lack of adequate remedies and impartiality under China's legal
            system may adversely impact our ability to do business and enforce
            our agreements with third parties;

      -     Fluctuations in exchange rates;


                                       14
<PAGE>


      -     Our dependence on third parties for equipment and services;

      -     Competition from our own cargo agents;

      -     Having seasonal business that causes fluctuations in our results of
            operations and financial condition;

      -     A lack of ongoing contractual relationships with our customers;

      -     Taking on significant credit risks in the operation of our business
            as East Coast U.S. freight forwarders expect us to offer thirty days
            credit from the time of cargo delivery;

      -     Our inventory of shipping space is subject to the significant risk
            that we may not be able to "fill" the space while having contracted
            for that space, and

            Our insurance may not be sufficient to cover losses or damages to
            the freight we ship or for consequential damages for a shipment of
            hazardous materials.

      Many of  these  factors  are  beyond  our  control,  and you  should  read
carefully the factors  described in "Risk Factors" in the  Registrant's  filings
(including its Forms 10-KSB and registration statements) with the Securities and
Exchange Commission for a description of some, but not all, risks, uncertainties
and contingencies. These forward-looking statements speak only as of the date of
this  document.  We do not undertake  any  obligation to update or revise any of
these  forward-looking  statements to reflect events or circumstances  occurring
after the date of this document or to reflect the  occurrence  of  unanticipated
events. Any forward-looking statements are not guarantees of future performance.


CRITICAL ACCOUNTING POLICIES AND ESTIMATES

      Management's discussion and analysis of financial condition and results of
operations are based upon Pacific CMA Inc.'s consolidated  financial statements.
These  statements have been prepared in accordance  with  accounting  principles
generally  accepted in the United States of America.  These  principles  require
management to make certain estimates,  judgments and assumptions that affect the
reported  amounts of assets,  liabilities,  revenues and  expenses,  and related
disclosure  of  contingent  assets and  liabilities.  On an on-going  basis,  we
evaluate  our  estimates,  based on  historical  experience,  and various  other
assumptions  that are believed to be  reasonable  under the  circumstances,  the
results of which form the basis for making  judgments  about the carrying values
of assets and  liabilities  that are not readily  apparent  from other  sources.
Actual results may differ from these estimates  under  different  assumptions or
conditions.

      The  following  critical   accounting   policies  rely  upon  assumptions,
judgments  and estimates and were used in the  preparation  of our  consolidated
financial statements:


                                       15
<PAGE>


RECOGNITION OF COST OF FORWARDING

      The billing of cost of forwarding is usually delayed. As a result, we must
estimate the cost of purchased transportation and services, and accrue an amount
on a load-by-load basis in a manner that is consistent with revenue recognition.
Such  estimate  is based on past  trends,  and on the  judgment  of  management.
Historically,  upon  completion  of the payment  cycle  (receipt  and payment of
transportation  bills),  the  actual  aggregate  transportation  costs  are  not
materially different than the accrual.  However, in any case in which the actual
cost varies  significantly  from the accrual, a revision to the accrual would be
required.

ACCOUNTING FOR INCOME TAXES

      In preparing our  consolidated  financial  statements,  we are required to
estimate our income taxes in each of the  jurisdictions  where we operate.  This
process involves estimating actual current tax exposure, together with assessing
temporary  differences  resulting from differing  treatment of items for tax and
accounting  purposes.  These  differences  result in  deferred  tax  assets  and
liabilities,  which are included in our consolidated balance sheet. We must then
assess the likelihood that our deferred tax assets will be recovered from future
taxable  income,  and to the extent that we believe that recovery is not likely,
we must establish a valuation allowance.  To the extent we establish a valuation
allowance,  we must include an expense within the tax provision of the statement
of operations in each period in which the allowance is increased.

      Significant  judgment is required in determining  the provision for income
taxes, deferred tax assets and liabilities, and any valuation allowance, against
our  deferred  tax assets.  In the event that actual  results  differ from these
estimates or the estimates are adjusted in future  periods,  then we may need to
establish an additional valuation  allowance,  which could materially impact our
financial  position and results of  operations.  Based on our current  financial
projections,  we currently believe that we will realize 100% of our deferred tax
assets.

VALUING LONG-LIVED ASSETS, INTANGIBLES AND GOODWILL

      We assess the  impairment of  identifiable  long-lived  assets,  purchased
intangible  assets and  goodwill  whenever  events or  changes in  circumstances
indicate that the carrying amount may be impaired. Factors that we consider when
evaluating for possible impairment include the following:

      1.    Significant  under-performance  relative to expected  historical  or
            projected future operating results;

      2.    Significant  changes in the manner of our use of the acquired assets
            or the strategy for our overall business; and

      3.    Significant negative economic trends.

      When  determining  whether the  carrying  value of  long-lived  assets and
goodwill  is  impaired  based  upon the  existence  of one or more of the  above
factors,  we determine the existence of impairment by comparison of the carrying
amount of the asset to expected  future cash flows to be generated by the asset.
If such assets are considered impaired, the impairment is measured as the amount


                                       16
<PAGE>


by which the carrying value of the assets exceeds their fair values. As of March
31, 2004, goodwill totaled approximately $2.68 million,  other intangible assets
amounted to approximately  $1.76 million and our long-lived  assets,  consisting
primarily of net property, plant and equipment, totaled $349,901.

      As  required  by  SFAS  No.  142,  goodwill  and  intangible  assets  with
indefinite lives are no longer  amortized,  but rather are to be tested at least
annually for impairment. This pronouncement also requires that intangible assets
with definite lives be amortized over their  respective lives to their estimated
residual  value and reviewed for  impairment  in  accordance  with SFAS No. 144,
"Accounting for the Impairment or Disposal of Long-Lived  Assets".  On April 30,
2002, we acquired 81% of the common stock of Airgate International  Corporation,
a privately held New York based freight forwarder.  As required by SFAS No. 142,
we allocated  the purchase  price to the assets,  liabilities,  intangibles  and
goodwill  acquired,  based on the fair  value  at the  date of  acquisition.  We
recorded  $2.86  million  of  intangible  assets  with  finite  lives  (customer
relationships)  and $2.68 million in goodwill  associated with this acquisition.
The intangible  customer  relationship  asset is amortized over a period of five
years  while  goodwill  is not  amortized,  but  rather is tested  annually  for
impairment in accordance with SFAS No. 142. The acquisition was accounted for as
a purchase,  and the results of operations of Airgate since May 1, 2002, and its
financial  condition  as of  each  balance  sheet  dates  are  reflected  in our
condensed  consolidated  financial  statements.  All  significant  inter-company
balances and transactions have been eliminated in consolidation.

OVERVIEW

      The  following   discussion  is  applicable  to  the  Company's  financial
condition  and  results of  operations  for the period  ended March 31, 2004 and
March 31, 2003.  Pacific CMA, Inc.  (Pacific CMA) does not directly carry on any
business activities.  Through its Hong Kong based subsidiary, AGI Logistics (HK)
Ltd.  (AGI),  and its New York based  subsidiary,  Airgate  International  Corp.
(Airgate),   Pacific  CMA  facilitates  and  provides  supply  chain  management
solutions,  contract  logistics  services and international  freight  forwarding
services.

      Its wholly owned  subsidiary,  AGI Logistics (HK) Ltd. (AGI),  operates an
integrated logistics and freight forwarding business which is based in Hong Kong
and which  primarily  handles  delivery of goods in South China and Hong Kong to
overseas  countries,  mainly  the Far East  region and the  United  States.  The
principal  services  provided by AGI are  airfreight  forwarding,  ocean freight
forwarding,  and  warehousing.  In the Far East  region,  Mainland  China is the
target market for AGI Group expansion.

      The business of AGI was first  established in August 1998 and now consists
of its own operations, as well as those of its subsidiaries. On January 1, 2001,
its Hong Kong incorporated subsidiaries included Sparkle Shipping, Godown, Wharf
& Transp.  Co., Ltd.  (Sparkle) and Guangzhou Huasheng Int'l Forwarding Ltd. (GZ
Huasheng),  and  AGI  Logistics  (Shenzhen)  Ltd.  (AGI  (Shenzhen))  which  was
incorporated in The Peoples  Republic of China ("the PRC"). On June 14, 2002, GZ
Huasheng  was renamed as  Guangdong  Springfield  Logistics  Services  Ltd.  (GD
Springfield).  On June 5, 2003, GD Springfield was renamed as Shenzhen  Careship
International Transportation Ltd. (SZ Careship). AGI (Shenzhen) and Sparkle were
disposed  of by AGI Group on May 11,  2001 and April 2, 2002,  respectively,  in


                                       17
<PAGE>


conjunction with a decision by AGI to concentrate on the  international  freight
forwarding  business.  The business  activities of Sparkle were  concentrated on
local feeder  voyages and trucking  operations  along the Jujiang  Delta Area of
Mainland China and it was determined that Sparkle would need to purchase its own
boats and trucks to maintain its competitive position. As a result, its business
operations  diverged from the Group's  non-asset based strategic plan. AGI Group
has elected to  concentrate  its resources and  investments on the operations of
AGI HK and SZ Careship in order to seek to improve  the tonnage  performance  in
Hong Kong and South China, U.S. and Europe.

      On April 30, 2002,  Pacific CMA  completed the  acquisition  of control of
Airgate,  a privately held New York-based freight forwarder that was established
in 1995.  Airgate is a non-asset based logistics  services company.  Pacific CMA
intends to continue the operations of Airgate in  substantially  the same manner
as they were  conducted  prior to the  acquisition.  Airgate  primarily  handles
import air and ocean shipments from the Far East and Southwest Asia to the U.S..
Pacific CMA  International,  LLC, a Colorado limited  liability  company that is
wholly owned by the Company,  acquired 81% of the issued and outstanding  common
stock of Airgate.

      The following  discussion  concerning  results of operations and liquidity
and  capital  resources  of  Pacific  CMA,  is based  solely  upon the  business
operations  which are  carried on by the group  consisting  of its wholly  owned
subsidiary AGI and its  subsidiaries,  and the results of Airgate from January 1
to March 31, 2004 and the same period of 2003.

      The  significant  new  developments,  which have occurred during the three
months ended March 31, 2004, include the following:

      o     Pacific CMA's shares of common stock are listed on the Frankfurt and
            Berlin Stock Exchanges  commenced trading on January 20, 2004, under
            the symbol "PWZ";

      o     Appointment of Joel Herskovits to be our Investor Relations person;

      o     Hiring of John M. Dauernheim as Chief Operating Officer;

      o     Being  designated as Official  Freight  Forwarder of the ASAP Global
            Sourcing Show held in Las Vegas from February 22 to 25, 2004;

      o     Entering  into  contract  rate  agreements  with  three   additional
            airlines (Thai Airways, Singapore Airlines and Royal Brunei); and

      o     Our sales and marketing team in the Europe Market is strengthened by
            engaging marketing staff in United Kingdom.

RESULTS OF OPERATIONS

THREE  MONTHS  ENDED MARCH 31, 2004  COMPARED  WITH THREE MONTHS ENDED MARCH 31,
2003

OVERALL RESULTS

      Freight  forwarders  are  compensated  on a  transactional  basis  for the
movement  of goods  and  provision  of  related  services  to  their  customers.
Therefore,  our revenue is derived from our freight  forwarding  services  based
upon the rates that we charge our  customers  for the movement of their  freight


                                       18
<PAGE>


from  origin to  destination.  The  carrier's  contract is with us, not with our
customers.  We are responsible  for the payment of the carrier's  charges and we
are legally  responsible  for the shipment of the goods.  We are responsible for
any claims for damage to the goods while in transit.  In most cases,  we receive
reimbursement from the carriers for any claims. Since many shippers do not carry
insurance  sufficient to cover all losses,  we also carry insurance to cover any
unreimbursed  claims for goods lost or  destroyed  in the event of a total loss.
Gross  revenue  represents  the total  dollar  value of  services we sell to our
customers. Our costs of transportation, products and handling include the direct
cost of transportation, including tracking, rail, ocean, air and other costs. We
commit to pay for space with shippers prior to receiving  committed  orders from
our  customers.  We act  principally  as a  service  provider  to add  value and
expertise in the  procurement and execution of these services for our customers.
Therefore,   our  gross  profits  (gross  revenues  less  the  direct  costs  of
transportation, products, and handling) are indicative of our ability to source,
add value and resell services and products that are provided by third parties.

      Total revenue for the period ended March 31, 2004 increased  approximately
17.3% compared with the period ended March 31, 2003, from $14,026,380 in 2003 to
$16,454,513  in 2004.  The increase in revenue was  primarily  the result of the
organic growth of AGI and Airgate.

      Revenue  derived from the  operations  of AGI increased  approximately  8%
during first quarter of 2004 as compared with the same period of 2003.

      The  significant  organic  growth of AGI was the  result of the  following
factors:

      1.    An increase in routed freight traffic from existing agency partners;

      2.    Improvements  in the agency  network which enabled AGI to secure new
            freight business;

      The revenue of Airgate represented  approximately 72% of our total revenue
for the first  quarter  2004.  Airgate  focuses its  operations on the import of
goods from the Far East. Airgate currently leases its own bonded warehouse where
deconsolidation  of cargo is  performed.  In order to enter new  markets  in the
Midwest, Airgate established a new subsidiary in Chicago, Illinois in June 2002.

      Revenue  derived  from the  operation of Airgate  increased  approximately
19.6%  during  the first  quarter  of 2004 as  compared  with that of 2003.  The
increase is the result of the effort of Airgate staff and the new  subsidiary in
Chicago.  During the first quarter 2003, the Chicago subsidiary was still in the
early development stage.

      As compared with 2003, the cost of forwarding during first quarter of 2004
increased  approximately  18%, from  $11,693,998 in 2003 to $13,791,615 in 2004.
This increase in costs was primarily the result of the organic growth of AGI and
Airgate.

      Gross  margin for the three months ended March 31, 2004 and March 31, 2003
was  constant  at  approximately  16%.  Gross  profit,  (revenue  minus  cost of
forwarding)  for the first quarter of 2004 increased  14.2%,  from $2,332,382 in
2003, to $2,662,898 in 2004.


                                       19
<PAGE>


      Traditionally, the first quarter of each financial year is the flat season
of the freight industry, we realized a 13.7% increase in net loss of $122,793 in
2004  compared  with the  $107,973  in 2003.  The  increase  in the net loss was
primarily  due to an 843% or $148,767  increase in non-cash  compensation  cost,
which was a result of the Company granting  2,050,000  restricted shares to four
key employees,  200,000 restricted shares to an independent sales representative
and 50,000 restricted to a business advisor during the period from November 2003
to March 2004.

      On or about November 7, 2003, we entered into four service agreements with
three employees and an independent sales representative.  Under the terms of the
agreements,  as amended in March 2004, we granted these  employees and the sales
representative  an aggregate of 1,950,000 shares of our common stock. The shares
are restricted as they have not been registered with the Securities and Exchange
Commission (the "SEC" or the "Commission"). The agreements, as amended, with the
employees  requires  them to continue to provide  services to us from January 1,
2004 through  December 31, 2013.  The  agreement  with the sales  representative
requires him to provide services to us from January 1, 2004 through December 31,
2005.

      Also in March 2004, the Company  entered into a service  agreement with an
employee/director.  Under the terms of the agreement the Company  granted to the
director 100,000 shares of Common Stock. The agreement  requires the director to
continue  to provide  services  to the  Company  from  January  1, 2004  through
December 31, 2008.

      Compensation  cost is  measured  at the grant date based on the  estimated
fair value of the restricted  securities.  The  compensation  cost is recognized
against  income  over the  service  period  required  under the  agreement.  The
unearned portion of the  compensation  cost related to the employees is recorded
in  equity  as  unearned  compensation  cost,  while  the  unearned  portion  of
compensation cost related to the independent sales representative is recorded as
"prepaid" asset. We are holding the stock certificates pending the completion of
the service agreements.

      In addition, in March 2004, the Company issued 50,000 shares of restricted
stock to a business advisor. The Company recorded an expense of $57,750 which is
the estimated fair value of the stock on the grant date.

      The total  compensation  cost charged to income  statement for the quarter
ended March 31, 2004 was $166,423.  The Company issued stock instead of cash for
certain services as management  believes this will have a positive impact on the
Company's cash flow status in the long term.

BUSINESS SEGMENT OPERATING RESULTS

      The results of operations for each segment are as follows:

      AIRFREIGHT  OPERATIONS:   Revenue  from  airfreight  operations  increased
approximately  16.7%, from $9,054,673 in first quarter of 2003 to $10,562,831 in
the same period of 2004. Airfreight revenue for AGI Group was $3,731,807,  while
airfreight  revenue for Airgate was  $8,320,491,  and  offsetting  inter-company
transactions  totaled $1,489,467.  The volume of airfreight was improved in 2004
compared with 2003.  The volume  improvement is primarily due to (i) an increase


                                       20
<PAGE>


in routing  orders from Asia to the United  States as a result of new  customers
and agents in India,  Mombassa  and Africa who joined  during the second half of
2003, (ii) Airgate International Corp. (Chicago) was established in June of 2002
and is now coming out of the early  development  stage and (ii) the  Company was
adversely  affected in the first  quarter  2003 due to the  outbreak of the SARS
virus in Asia.

      Costs for the airfreight  forwarding  operations  during the first quarter
increased  approximately  14.9%,  from $7,523,794 in 2003 to $8,648,218 in 2004.
Airfreight cost  attributable to AGI Group was $2,997,086  while airfreight cost
attributable to Airgate was $7,140,599,  and offsetting inter-company costs were
$1,489,467.  The gross profit margin was  increased by 7.10% from  approximately
16.9% in 2003 to  approximately  18.1% in 2004.  This  increase is the result of
better   utilization   of  cargo   space  with  better   arrangement   of  cargo
consolidation.  As  a  result  of  increased  revenues,  overall  gross  profits
increased approximately 25.1% to $1,914,613

      Total segment overhead  attributable to the airfreight operation increased
approximately  22.7%,  from  $693,795  in  2003 to  $851,099  in  2004.  Details
regarding  the  increase  in overhead  expenses  are  discussed  below under the
section title "Other Operating Expenses."

      Overall,  net  segment  income  for  the  airfreight  operation  increased
approximately 27.0% for the period ended March 31 2004, from $837,084 in 2003 to
$1,063,514 in 2004.  The increase in net segment income was mainly the result of
the organic growth of AGI and Airgate.

      SEA  FREIGHT  OPERATION:  Revenue  from sea freight  operations  increased
approximately  18.5% to $5,891,682 in 2004 from  $4,971,707 in 2003. Sea freight
revenue for AGI Group was $1,256,676,  while sea freight revenue for Airgate was
$4,793,385,   and  offsetting  inter-company  transactions  were  $158,379.  The
increase in revenue for the period was due to our new agents in India, Japan and
Turkey,  who introduced  more  customers  into our network.  These new customers
generated more revenue from the Shanghai  market  starting in the second quarter
of 2003. There was also an increment in the quantity of freight consolidation in
the Chicago operation of Airgate. Costs for the sea freight forwarding operation
increased  approximately  23.3%,  from $4,170,204 in 2003 to $5,143,397 in 2004.
Sea  freight  costs  attributable  to  AGI  Group  were  $965,818,  while  costs
attributable to Airgate were $4,335,958, and inter-company costs were $158,379.

      The gross profit margin decreased  approximately  21.1% from 16.1% in 2003
to 12.7% in 2004 due to our market penetration strategy in Shanghai and Chicago.
As a result of the  reduction  in gross profit  margin,  overall  gross  profits
decreased by approximately 6.63%, to $748,285.

      Total segment overhead attributable to the sea freight operation increased
approximately  31.7%,  from $309,396 in first quarter of 2003 to $407,344 in the
same period of 2004. Overall net income for the sea freight operation  decreased
approximately  30.7%, from $492,107 in first quarter of 2003 to $340,941 for the
same period in 2004. The decrease in net segment income was mainly the result of
reduction of gross profit margin for sea freight operation during the period.


                                       21
<PAGE>


OPERATING EXPENSES

GENERAL AND ADMINISTRATIVE EXPENSES

      General  and  administrative  expenses  slightly  increased  by 12.9%,  to
$2,584,653 in first quarter of 2004 from  $2,288,344 in the same period of 2003.
The following factors caused the increase in expenses:

      Sales  commission:  Sales commission  increased  approximately  24.3% from
$350,288 in 2003 to $435,262  in 2004.  The  increase is a result of increase in
freight forwarding income during the first quarter of 2004.

      Salaries and  allowance:  Salaries and allowance  increased  approximately
14.1% from  $965,084 for the period ended March 31, 2003 to  $1,101,611 in 2004.
This increase was the result of the addition of  approximately  23 staff persons
during 2003 needed to keep pace with our growth.

COMPENSATION COST

      Compensation cost: During the period from November 2003 to March 2004, the
Company issued total 2,100,000 shares of its common stock to four employees,  an
independent sales  representative  and a business advisor.  Compensation cost is
measured at the grant date based on the estimated fair value of the  securities.
It is  recognized  as an expense  over the  service  period  required  under the
service agreements with those parties.  The unearned portion of the compensation
cost related to employees is recorded in equity as unearned  compensation  cost,
while the unearned portion of compensation cost related to the independent sales
representative is recorded as a prepaid asset. During the period ended March 31,
2004,  $166,423 of  compensation  cost was  expensed,  as compared with the same
period of 2003, we recorded an increase of 843% from $17,656.

DEPRECIATION AND AMORTIZATION

      Depreciation and amortization decreased  approximately 6.94% from $193,101
in  2003  to  $179,700  in  2004.  The  decrease  is  due to  the  reduction  of
depreciation of property and equipment.

      Amortization  arises  from  an  intangible  customer   relationship  asset
recorded in  conjunction  with the  acquisition of Airgate on April 30, 2002. We
recorded  this  asset  at  cost   ($2,860,000)   and  are  amortizing  it  on  a
straight-line  basis over a period of 5 years. During the period ended March 31,
2003 and 2004, the amortization  expense attributable to this asset was $143,000
respectively.

NON-OPERATING INCOME

INTEREST AND OTHER INCOME

      Interest and other income  increased from $47,500 in first quarter of 2003
to $95,778  in the same  period of 2004.  This was due to various  miscellaneous
handling charges (i.e. examination charges) received from third parties.


                                       22
<PAGE>


INTEREST EXPENSE

      Interest  expense  increased to $89,527 in 2004 from $43,726 in 2003.  The
increase  in interest  expense is  primarily  due to an  increase in  short-term
working capital financing.

RISK FACTORS AFFECTING COMPANY OPERATIONS

      The  Company's  ability to  provide  service  to its  customers  is highly
dependent  on good  working  relationships  with a variety of  entities  such as
airlines, steamship carriers and governmental agencies.

      Unlike other U.S.  logistics  companies,  the Company  bears a significant
amount of inventory  risk. We pay for the  guarantees we put up to the carriers,
even if we do not have any customer cargo to fill the space.  We are not able to
ask our clients to make these guarantees and, accordingly,  we assume all of the
risks.

      The Company  has freight  forwarders  liability  insurance  that covers it
against claims from clients.  We take  responsibility  for the cargo, and we are
responsible  for its safe delivery.  Therefore,  we can be held  responsible and
incur losses if anything goes wrong.

      Changes in governmental  deregulation  efforts,  regulations governing the
Company's products,  and/or the international trade and tariff environment could
all affect the Company's business in unpredictable ways.

      Management  believes the Company's  business has not been significantly or
adversely  affected  by  inflation  in the past.  Historically,  the Company has
generally been successful in passing cost increases to its customers by means of
price increases.  However,  competitive market place conditions could impede the
Company's  ability to pass on future cost increases to customers and could erode
the Company's operating margins.

      The Company  continues to assess and improve financial  controls,  and has
negotiated  successfully  with its banks to get  credit  facilities  for  future
financial needs.

      Additional risks and uncertainties include:

      o     Governmental   deregulation   efforts,   regulations  governing  the
            Company's  products  and/or  the  international   trade  and  tariff
            environment  adversely  affecting our ability to provide services to
            customers.

      o     Competitive  marketplace  conditions  impeding  the  ability  of the
            Company to pass future cost increases to customers.

      o     The  Company's  dependence on  international  trade  resulting  from
            favorable worldwide economic conditions.

      o     The  Company's   dependence   on  retaining  and   addingsignificant
            customers.

      o     The Company's  ability to recruit and retain skilled  employees in a
            tight labor market.


                                       23
<PAGE>


      o     The  ability of the  Company to develop  and  implement  information
            systems to keep pace with the  increasing  complexity  and growth of
            the Company's business.


      o     Following the September 11 attacks, airlines charge additional costs
            such  as  a  fuel  surcharge,   insurance  surcharge  and  war  risk
            surcharge. These surcharges are generally passed through to shippers
            and consignees, which increases their shipping costs. As a result of
            these increased costs, the shipping  incentive of customers has been
            reduced, and the rate of order cancellation has increased.

      o     During March of 2003, The World Health Organization received reports
            of 'Severe  Acute  Respiratory  Syndrome'  in  various  parts of the
            world.  SARS  caused  airlines  to  reduce  capacity  and  adversely
            affected  external  trade from Hong Kong and the Pearl River  Delta.
            The  Company's  operations  were  adversely  affected by this health
            problem.

LIQUIDITY AND CAPITAL RESOURCES

      We used  approximately  $1,249,000  and  $1,251,000 of cash from operating
activities for the three months ended March 31, 2004 and 2003 respectively.  The
use of cash  was  mainly  attributable  to  additional  amounts  used  in  other
receivables. It is also due to an increase in refundable income taxes.

      Net cash used in investing activities was $303,605 during the period ended
March 31, 2004 while the net cash  provided by investing  activities  during the
same period of 2003 was  $74,832.  During the three months ended March 31, 2004,
we used $74,987 to acquire plant and equipment to improve our office facilities,
and used $195,154 for the deposits of a potential equity investment in Shanghai.

      Net cash provided by financing activities was approximately $1,393,000 and
$1,352,000 for the period ended March 31, 2004 and 2003 respectively. During the
first  quarter of 2004,  the Company had net  borrowings  from banks for working
capital  financing  arrangements of  approximately  $1,639,000,  and payments of
short-term bank debt of $231,722.

      Working   capital  was  $1,732,312   (inclusive  of  restricted   cash  of
approximately $5.8 million) and $1,850,649 as of March 31, 2004 and December 31,
2003  respectively.  We  believe  that we will be able to rely on cash flow from
operations  for  short-term  liquidity,  and also believe that we have  adequate
liquidity to satisfy our material  commitments  for the twelve months  following
March 31, 2004. We also believe that we can obtain additional  liquidity through
further  negotiation  of short-term  loans from banks to satisfy our  short-term
funding needs, if any.

         We intend to continue our expansion  plans through a mixture of organic
growth and acquisitions.  Future acquisitions will focus on companies that serve
as  freight  forwarders  in key  markets  or offer  services  (such  as  customs
brokerage) that complement our existing  services.  We intend to achieve organic
growth through the establishment of new branch offices in the Latin America. and
joint ventures in the PRC, and through a major  marketing  campaign  through the
Indian  subcontinent,  including  India,  Sri Lanka and Bangladesh.  In order to
achieve this goal, we will be required to raise a certain amount of capital.  To


                                       24
<PAGE>


a  certain  extent,  these  activities  will have a  significant  impact on both
liquidity and capital resources.

CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENT

      From time to time, we have entered into various  contractual  obligations,
which may be summarized as follows:

<TABLE>
<CAPTION>
                                                                          PAYMENTS DUE BY PERIOD
                                                     ------------------------------------------------------------------
CONTRACTUAL OBLIGATIONS                         TOTAL      LESS THAN 1 YEAR   1-3 YEARS     4 - 5 YEARS      THEREAFTER
<S>                                         <C>             <C>             <C>             <C>             <C>
Finance lease Obligations                   $     74,289    $     34,913    $     39,376    $         --    $         --

Unsecured Bank Loans                              43,687          43,687              --              --              --

Operating Leases                               1,462,821         457,942         353,114         357,321         294,444

Cargo Space Commitments                        7,608,337       7,608,337              --              --              --

Material Employment Agreements                   873,250         499,000         374,250              --              --
</TABLE>

      We have finance  lease  obligations  of $74,289 as of March 31,  2004,  of
which  $34,913 is repayable  within one year,  and $39,376 is repayable  after 1
year.

      The amount due to directors,  totaling  $8,702,  represents  amount due to
Alfred Lam.

      Debts maturing within one year amounted to $305,788.

      We also entered into various  lease  commitments  for office  premises and
warehouses  in the United  States,  Hong Kong and China.  The total  outstanding
lease  commitments  under  non-cancelable  operating leases are $1,462,821 as of
March 31, 2004. The current portion of these  commitments of $457,942 is payable
within one year.

      We have entered into written  agreements  with various sea and  airfreight
carriers  committing to take up a guaranteed  minimum amount of cargo space each
year. As of March 31, 2004, the amount  outstanding  for such  commitments to be
entered into in 2004 was approximately $7.6 million.

      In connection with the acquisition of Airgate  International  Corporation,
we also entered into  three-year  employment  agreements,  dated April 30, 2002,
with Mr. Turner and Mr. Zambuto,  respectively, as described in a Current Report
on Form 8-K filed on May 14, 2002. Under these agreements, we agreed to pay each
of them an annual base salary of $249,500 per annum commencing  January 1, 2003,
and for each year thereafter during the term of their employment agreements.


                                       25
<PAGE>


      As of March 31, 2004,  our  commercial  commitments  may be  summarized as
follows:

<TABLE>
<CAPTION>
OTHER COMMERCIAL COMMITMENTS         TOTAL AMOUNTS COMMITTED         AMOUNT OF COMMITMENT EXPIRATION
                                                                                          PER PERIOD
                                                                                    LESS THAN 1 YEAR
<S>                                                <C>                                     <C>
                                                           $                                       $
Overdraft                                          3,858,046                               3,858,046
Invoice Trust Receipt                              1,286,774                               1,286,774
Income tax loan                                      262,101                                 262,101
Short-tern bank loans                                 43,687                                  43,687
Guarantees by bank                                   476,190                                 476,190
</TABLE>

      As of March 31, 2004 to finance our working capital, our available banking
facilities were approximately  $7,000,000 obtained from creditworthy  commercial
banks in Hong Kong and  $2,500,000  from a bank in the U.S. As of that date, the
total amount of bank credit facilities utilized was $7,644,819. This was made up
of (i) $3,858,046 of overdrafts;  (ii)  $1,286,773 of invoice trust receipts and
(iii)  $2,500,000  line of credit.  In  addition to the credit  facilities,  the
Company  has a $262,101  Income Tax Loan and  $43,687  of  short-term  bank loan
outstanding as of March 31, 2004. Moreover, there is $476,190 of bank guarantees
for granting  credit  facilities to a subsidiary for airfreight  payment.  While
these banks are not  obligated  to advance  any further  funds to us, we believe
that absent any significant downtrend in business,  these sources of credit will
continue to be available to us.

OUTLOOK

      Despite a global economic  downturn,  we believe the following factors may
have a positive  impact on our future  results of  operation  and our  financial
conditions:

CHINA'S INCREASED EXPORTS

      According to a recent  research  report issued by Barrow Street  Research,
Inc.  (the "Barrow  Report")  between 1990 and 2003,  China's total exports grew
eight  times  to  over  $380  billion.  China's  share  of  global  exports  are
anticipated  to reach 6% in 2003, a 54% growth from 2000. The Barrow Report also
states that China accounted for 16% of the growth in the world economy,  ranking
second  only to the US. The rising  trading  power of China has been  especially
important for transportation companies. With extensive operational centers based
in Hong Kong and South China, management believes the Company is well positioned
to take advantage of this rapid growth in trade


                                       26
<PAGE>


CLOSER ECONOMIC PARTNERSHIP

      Arrangement The Closer Economic Partnership  Arrangement ("CEPA") that was
signed on June 29, 2003,  originally  focused on stimulating  and enhancing Hong
Kong's economic recovery.  In theory, CEPA significantly lowers the barriers for
Hong Kong enterprises to tap the Mainland China market.

      Under the CEPA,  Hong Kong  companies are permitted to set up wholly owned
enterprises  in  Mainland  China  to  provide  logistics  services  and  related
consultancy  services for ordinary road freight, and to engage in the management
and operation of logistics services through electronic means. It permits freight
forwarding  agents to operate in Mainland  China on a wholly  owned basis a full
two years ahead of China's WTO entrance  timetable,  and will permit such agents
to enjoy  national  treatment  in  respect  of the  minimum  registered  capital
requirement.  In addition, it eliminates the import tariffs to Mainland China on
a host of goods made in Hong Kong,  allowing  most Hong Kong  companies  to sell
high value-added products across the border. In terms of economic benefits,  the
CEPA has good potential to open up many new business  opportunities  in Mainland
China for Hong Kong.  Although it is difficult to quantify the potential benefit
we may realize from CEPA,  through our Hong  Kong-based  AGI Logistics (HK) Ltd,
Shenzhen Careship  Transportation  Limited, as well as AGI China Ltd, we believe
we can  enjoy  "first  mover"  advantage,  that  is,  we  believe  that our Hong
Kong-based  subsidiaries  can benefit  from CEPA because we have  experience  in
doing  business  in,  and we  believe  that  we  are  knowledgeable  in  China's
regulations and business practices. We believe that our existing offices in Hong
Kong and  Mainland  China can also  respond  quicker  than  other  U.S.  freight
forwarders to ongoing developments in China.

OUTSOURCING OF NON-CORE ACTIVITIES

      Companies are increasingly outsourcing freight forwarding, warehousing and
other supply chain  activities so that they may focus on their  respective  core
competencies.  Companies are  increasingly  turning to freight  forwarders,  and
logistics and supply chain management providers, to manage their purchase orders
and assure timely delivery of products at a lower cost and at greater efficiency
than if the function was undertaken directly.

GLOBALIZATION OF TRADE

As barriers to international  trade are gradually reduced,  international  trade
will similarly increase.  In addition,  companies are increasingly  sourcing for
supplies and raw materials from the most  competitive  suppliers  throughout the
world.  This form of sourcing would generally also lead to increased  volumes of
trade.

INCREASED NEED FOR TIME-DEFINITE DELIVERY

      The demand for just-in-time and other time definite delivery has increased
as a result of the  globalization of  manufacturing,  greater  implementation of
demand-driven supply chains, the shortening of product cycles and the increasing
value of individual shipments.


                                       27
<PAGE>


A SHIFT TOWARDS A DECREASING NUMBER OF GLOBAL SUPPLY CHAIN MANAGEMENT PROVIDERS

      Companies are decreasing the number of freight forwarders and supply chain
management  providers  with which they  interact  so that they might work with a
limited number of providers who are familiar with their requirements,  processes
and procedures,  and who can function as long-term  partners.  As such,  freight
forwarders  that  are  globally  integrated  and  are  able  to  provide  a full
complement of services,  including  pick-up and delivery,  shipment via air, sea
and  land,  warehousing  and  distribution  and  customs  brokerage,   are  well
positioned to gain from this shift.

EXPIRATION OF GARMENT QUOTA IN 2005

      The garment quota in the U.S expires in 2005.  With the expiration of this
garment  quota,  exporters  are uncertain of the business  environment  and as a
result, the Company  anticipates that garment exporters will attempt to increase
their sales and exports in 2004 before the quota expires with a potential for an
increase in the volume of trade.


ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

      The  Company  is  exposed  to market  risk in the  ordinary  course of its
business. These risks are primarily related to foreign exchange risk and changes
in short-term  interest rates. The potential impact of the Company's exposure to
these risks is presented below:

Foreign Exchange Risk

      The Company conducts business in many different  countries and currencies.
The Company's business often results in revenue billings issued in a country and
currency,  which differs from that where the expenses related to the service are
incurred. This brings a market risk to the Company's earnings.

      Foreign  exchange  rates   sensitivity   analysis  can  be  quantified  by
estimating  the impact on the  Company's  earnings  as a result of  hypothetical
change in the  value of the U.S.  Dollar,  the  Company's  functional  currency,
relative to the other currencies in which the Company transacts business. As one
of the major subsidiaries uses the Hong Kong Dollar (HKD), which has been linked
to the U.S.  Dollar  at a rate of HKD7.8 to USD1,  as its  functional  currency,
there  has been no  material  change  in the  Company's  foreign  exchange  risk
exposure.  However,  if HKD  was  unlinked  to the US  Dollar,  an  average  10%
weakening of the U.S. Dollar,  throughout the period ended March 31, 2004, would
have had the  effect of  raising  operating  income  approximately  $14,000.  An
average 10%  strengthening of the U.S. Dollar,  for the same period,  would have
had the effect of reducing operating income by approximately $12,000.

      The  Company  currently  does  not  utilize  any  the  derivate  financial
instruments or hedging transactions to manage foreign currency risk.


                                       28
<PAGE>


INTEREST RATE RISK

      The Company does not currently utilize derivative financial instruments to
hedge against changes in interest rates. At March 31, 2004, the Company had cash
and cash equivalents and restricted cash of $6.500,000 and short-term borrowings
of $7,700,000, all subject to variable short-term interest rates. A hypothetical
change in the  interest  rate of 10% would have an  insignificant  impact on the
Company's earnings.

      In  management's  view,  there has been no  material  change in  Company's
market risk exposure between 2003 and 2004.

ITEM 3. CONTROLS AND PROCEDURES

      The  Registrant's  Chief Executive  Officer and Chief  Financial  Officer,
after evaluating the effectiveness of the Registrant's  disclosure  controls and
procedures  (as defined in Rules  13a-14(c) and 15d-14(c)  under the  Securities
Exchange Act of 1934, as amended) as of March 31, 2004 (the "Evaluation  Date"),
have concluded  that, as of the Evaluation  Date,  the  Registrant's  disclosure
controls  and  procedures  were  effective  to  ensure  the  timely  collection,
evaluation,  and disclosure of information relating to the Registrant that would
potentially be subject to disclosure under the Securities  Exchange Act of 1934,
as amended, and the rules and regulations promulgated under that Act. There were
no significant changes in the Registrant's internal controls or in other factors
that  could  significantly  affect  the  internal  controls  subsequent  to  the
Evaluation Date.

                                     PART II

                                OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

      On March 19,  2004,  the  Registrant  and Alfred Lam  commenced  an action
against Frascona, Joiner, Goodman and Greenstein,  P.C. and others in the United
States District Court for the Southern District of New York (2004 Civ. 2213), in
which the Registrant and Mr. Lam allege that the Registrant's  prior counsel and
others  violated  the  anti-fraud  provisions  of the federal  securities  laws,
breached  their  fiduciary  duty to the Registrant and breached a stock purchase
agreement with Mr. Lam, in connection  with their sales of the securities to Mr.
Lam.

ITEM 2. CHANGES IN  SECURITIES,  USE OF PROCEEDS AND ISSUER  PURCHASES OF EQUITY
SECURITIES

      On  March  23,   2004,   the   Registrant's   shareholders   approved  the
reincorporation of the Registrant in the State of Delaware, and removing it from
the State of Colorado.  See Part II, Item 4, below. That reincorporation  became
effective at 5:00 p.m. Eastern Time on March 31, 2004,

      Although  no attempt has been made to  summarize  all  differences  in the
corporate  laws of such states,  management  believes the following to be a fair
summary of the  significant  differences  in the corporate laws of the States of
Colorado and Delaware.


                                       29
<PAGE>


Examination Of Books And Records.  Under Colorado corporation law, a person must
have been a shareholder for at least three months, or be the holder of record of
at least  five  percent  of all  outstanding  shares  of any class of stock of a
corporation in order to examine  certain records of the  corporation,  including
the  minutes  of  meetings  of the  board of  directors  and  board  committees,
accounting records and shareholder records.  Under Delaware corporation law, any
stockholder  with a proper  purpose may demand  inspection of the records of the
corporation.

Dividends.  Under Delaware  corporation  law, a corporation may pay dividends to
its stockholders either out of surplus (net assets in excess of stated capital),
or in case there is no surplus,  out of net profits for the current  fiscal year
and  the  preceding  fiscal  year,  with  certain  limitations.  Under  Colorado
corporation  law,  dividends  may be  paid  out of net  assets  available  after
providing  for  satisfaction  of  preferential   rights  of  shareholders  whose
preferential rights are superior to those receiving the dividend.

Votes Of  Shareholders.  Colorado  corporation  law  provides  that  unless  the
Certificate of Incorporation  provides otherwise,  the vote of a majority of all
outstanding  shares entitled to vote is required to amend the corporate charter,
to dissolve a corporation, to effect a merger or consolidation or to sell, lease
or exchange all or substantially all of the corporation's assets. Under Delaware
corporation law and our Certificate of Incorporation,  the vote of a majority of
the  outstanding  stock  entitled  to vote is  required  to amend the  corporate
charter,  to dissolve a corporation,  to effect a merger or  consolidation or to
sell,  lease or exchange all or  substantially  all of a  corporation's  assets.
Under both Colorado and Delaware law, action by the board of directors,  as well
as the shareholders, is required to amend the corporate charter, effect a merger
or consolidation or the sale, lease or exchange of its assets.

Cumulative  Voting.  Delaware  corporation  law permits a corporation to provide
cumulative  voting by including a provision to that effect in its Certificate of
Incorporation.  Our  Certificate  of  Incorporation  does not  have a  provision
permitting  cumulative voting. Under Colorado corporation law, shareholders have
cumulative  voting unless  prohibited in the Certificate of  Incorporation.  Our
prior Colorado  Certificate of Incorporation  was ambiguous as to whether or not
cumulative voting for our Directors exists. Our management  believed  cumulative
voting had been meant to be eliminated.

Action By Written Consent  Without A Meeting.  Under Colorado  corporation  law,
shareholders  may take action without  meetings by unanimous  written consent of
the shareholders  entitled to vote. Under Delaware corporation law, stockholders
may take action  without  meetings by written  consent  signed by the holders of
outstanding stock having not less than the minimum number of votes that would be
necessary  to  authorize  or take such  action at a meeting  at which all shares
entitled to vote thereon were present and voted. Alfred Lam, the Chairman of our
Board of  Directors  owns more than a majority of the votes  represented  by our
common stock.  As a result,  Mr. Lam has the power to act by written  consent to
authorize any action which requires  stockholder  approval,  without the vote of
any other stockholders.

Anti-Takeover  Legislation.  Delaware  has  enacted a statute  which  prevents a
"business  combination"  between  an  "interested  stockholder"  and a  Delaware
corporation  for a period  of three  years  after  such  stockholder  became  an
interested stockholder,  unless certain conditions are met. The Delaware statute


                                       30
<PAGE>


defines a business combination as any merger or consolidation,  any sale, lease,
exchange or other  disposition of 10% or more of a corporation's  assets, or any
transaction  (subject to certain  exceptions)  which  results in the transfer of
stock  of  a  corporation   to  the   interested   stockholder,   increases  his
proportionate  ownership of a corporation's  stock or results in such interested
stockholder receiving the benefit of any loans, advances, guarantees, pledges or
other financial  benefits  provided by or through the corporation.  The Delaware
statute defines an interested stockholder as (subject to certain exceptions) any
person who is the owner of 15% or more of the  outstanding  voting  stock of the
corporation or a person who is an affiliate or associate of the  corporation who
became  the  owner  of 15%  or  more  of the  outstanding  voting  stock  of the
corporation within the three-year period prior to the date on which it is sought
to determine whether such stockholder is interested.  A business  combination is
exempt from the effect of the statute if, among other  things,  either (i) prior
to the date the stockholder became  interested,  the board of directors approved
either  the  business  combination  or  the  transaction  that  resulted  in the
stockholder becoming interested,  (ii) upon consummation of the transaction that
resulted in the stockholder becoming interested, such stockholder owned at least
85% of the corporation's  voting stock at the time the transaction  consummated,
or (iii) on or after the date the stockholder becomes  interested,  the business
combination is approved by the board of directors and authorized at an annual or
special meeting of stockholders by the affirmative  vote of at least  two-thirds
of the outstanding voting stock not owned by the interested stockholder.

      The  anti-takeover  statute provides that the Certificate of Incorporation
of a Delaware corporation may provide that the corporation  expressly elects not
to be governed by the statute. Our Certificate of Incorporation does not include
such a provision.

      The effect of  reincorporation  in Delaware,  and thereby subjecting us to
the  anti-takeover  statute,  makes it more  difficult for a person who seeks to
acquire control over us or to effect a business  combination  with us, such as a
tender offer,  to do so without  management's  approval,  thereby making it more
difficult  to remove  our  existing  management.  The  Delaware  statute  could,
therefore,  potentially  have an  adverse  impact  on  stockholders  who wish to
participate  in any such  tender  offer or other  transactions  even  where such
transaction may be favorable to the interests of the stockholders.

      Our  reincorporation  into Delaware could have the effect of  discouraging
hostile tender offers, proxy contests or other transactions by forcing potential
acquirors to negotiate  with  incumbent  management.  The  disadvantages  to our
reincorporation  into Delaware  includes  reducing the likelihood that a hostile
tender  offer at a premium  over market  price for our shares will be made.  Our
reincorporation  has a practical  effect on our  stockholders  by making it more
difficult to remove existing management without such management's approval.

Dissolution.  Under  Colorado  corporation  law and upon its board of  directors
adopting a resolution  setting  forth a proposal to dissolve  which  proposal is
approved  by a  majority  of  the  shareholders  entitled  to  vote  thereon  is
sufficient.  Under Delaware law, a corporation can  voluntarily  dissolve if its
board of directors and a majority of the  stockholders  entitled to vote thereon
approve the  dissolution,  or without  approval of the board of directors if all
the stockholders entitled to vote approve the dissolution.


                                       31
<PAGE>


Liability Of Directors.  Under Delaware law, directors are jointly and severally
liable to a  corporation  for  willful  or  negligent  violations  of  statutory
provisions  relating to the purchase or redemption of a corporation's own shares
or the  payment  of  dividends,  for a period of six years from the date of such
unlawful act. A director who was either  absent or dissented  from the taking of
such action may  exonerate  himself from  liability by causing his dissent to be
entered in the corporation's  minutes. Under Colorado law, directors are jointly
and severally liable to the corporation if they vote for or assent to acts which
violate  statutory  provisions  relating to the purchase of a corporation's  own
shares,  the payment of dividends,  the distribution of assets in liquidation or
any loans or guarantees made to a director,  until the repayment thereof.  Under
Colorado  law,  there is no  express  standard  of conduct  which can  protect a
director from liability nor any express  statute of limitations  with respect to
any such  illegal  acts by a  director,  as there are under  Delaware  law,  and
directors  are not  liable  as long as they did not vote for or assent to any of
the illegal acts.  Colorado law,  unlike Delaware law, allows a director who was
present at a meeting which approved an illegal act to avoid  liability,  even if
he does not  register  his  dissent  in the  minutes of the  meeting,  by voting
against the illegal act.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

      None

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

      On  March  23,  2004,  the  Registrant  held  a  Special  Meeting  of  its
Shareholders  at 4:00 p.m.  local time at its offices  located at 1350 Avenue of
the Americas, Suite 3100, New York, New York 10019.

      Proposals   presented  to  the  shareholders  at  that  meeting  were  the
following:  PROPOSAL 1. A proposal to ratify,  approve and confirm the change of
the Registrant's  state of incorporation from the State of Colorado to the State
of Delaware by means of a merger of the  Registrant  with and into  Pacific CMA,
Inc.  (Delaware),  a newly formed Delaware  corporation that was wholly owned by
the  Registrant,   with  Pacific  CMA,  Inc.  (Delaware)  to  be  the  surviving
corporation  in the merger,  and with the effect of the merger  changing the law
applicable  to the  Registrant's  corporate  affairs from the Colorado  Business
Corporation Act to the Delaware General Corporation Law.

      PROPOSAL  2. A proposal to ratify,  approve  and confirm the  Registrant's
agreement with Henrik Christensen, an Executive Vice President of the Registrant
and a member of the Registrant's Board of Directors,  providing for the issuance
of 100,000 shares of the Registrant's  common stock as partial  compensation for
his continued services to the Registrant.

      PROPOSAL  3. A proposal to ratify,  approve  and  confirm the  issuance of
warrants to purchase 50,000 shares of the Registrant's  common stock to R. Keith
Fetter for a term expiring on September  30, 2008 at an exercise  price of $0.85
per share. Mr. Fetter is a principal of Piedmont Consulting,  Inc.  ("Piedmont")
and had served as the Registrant's public and investor relations consultant.


                                       32
<PAGE>


      PROPOSAL  4. A proposal to ratify,  approve  and confirm the  Registrant's
agreement  with Basic  Investors,  Inc.  ("Basic"),  a management  and financial
consultant to the Registrant's  for Basic's  services in  consideration  for the
issuance of 50,000 shares of the Registrant's common stock.

      An aggregate of 19,627,494 shares, representing approximately 76.4% of the
Registrant's  then  25,675,590  issued and  outstanding  shares were  present in
person or by proxy. A clear quorum was present.

      The shareholders in person or by proxy voted their shares as follows:

<TABLE>
<CAPTION>
                                                                                                   Approximate
                                                                                                  Percentage of
                                                                                                 "For" Votes of
                                                                                                 all Issued and
                                          For               Against            Abstain         Outstanding Shares
                                          ---               -------            -------         ------------------
<S>                                    <C>                <C>               <C>                <C>
       PROPOSAL 1                      19,618,994             7,500             1,000                 76.4%

       PROPOSAL 2                      19,598,594            21,900             7,000                 76.3%

       PROPOSAL 3                      19,593,494            29,000             5,000                 76.3%

       PROPOSAL 4                      19,592,594            29,400             5,500                 76.3%
</TABLE>

      As  a  result,   all  four   proposals   were  approved  by  the  Issuer's
shareholders.

ITEM 5. OTHER INFORMATION

      None

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

      (a)   Exhibits (filed herewith)

      31.1  Certification of the Chief Executive Officer pursuant to Section 302
            of the Sarbanes-Oxley Act of 2002 (Rule 13a-4(a)).

      31.2  Certification of the Chief Financial Officer pursuant to Section 302
            of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a)).

      32.1  Certification  of the Chief Executive  Officer pursuant to 18 U.S.C.
            Section   1350,   as  adopted   pursuant   to  Section  906  of  the
            Sarbanes-Oxley Act of 2002 (Rule 13a-14(b)).


                                       33
<PAGE>


      32.2  Certification  of the Chief Financial  Officer pursuant to 18 U.S.C.
            Section   1350,   as  adopted   pursuant   to  Section  906  of  the
            Sarbanes-Oxley Act of 2002 (Rule 13a-14(b)).

      (b)   Reports on Form 8-K

      During the fiscal quarter covered by this Report,  the Registrant filed no
Reports on Form 8-K.


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                                   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.


                               PACIFIC CMA, INC.


Date:  May 14, 2004            By: /s/ Alfred Lam
                                   ---------------------------------------------
                                     Name:  Alfred Lam
                                     Title: Chairman of the Board of Directors
                                            (Principal Executive Officer)


Date:  May 14, 2004            By: /s/ Daisy Law
                                   ---------------------------------------------
                                    Name:   Daisy Law
                                    Title:  Chief Financial Officer
                                            (Principal Financial and Accounting
                                            Officer)