UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

      |X|   Quarterly Report pursuant to Section 13 or 15(d) of the
            Securities Exchange Act of 1934 For the quarterly period
            ended June 30, 2005

      |_|   Transition Report pursuant to 13 or 15(d) of the
            Securities Exchange Act of 1934 For the transition period
            ---------------- to ----------------

                   Commission File Number 333-64804
                                -------

                     BONUSAMERICA WORLDWIDE CORP.
   -----------------------------------------------------------------
   (Exact name of small Business Issuer as specified in its charter)

                 Nevada                                  75-3026459
    -------------------------------             ---------------------------
    (State or other jurisdiction of          (IRS Employer Identification No.)
     incorporation or organization)

       834 S. Broadway, 5th Floor, Los Angeles, California 90014
       ---------------------------------------------------------
               (Address of principal executive offices)

                            (213) 243-1505
           ------------------------------------------------
           (Issuer's telephone number, including area code)

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the issuer was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days
      Yes |X| No |_|

State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date: 19,862,000 shares common stock
outstanding as of August 15, 2005.

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


                                       1
<PAGE>

BONUSAMERICA WORLDWIDE CORP.,
FORM 10-QSB
INDEX

PART I.  FINANCIAL INFORMATION                                              Page

Item 1.  Financial Statements and Condensed Notes
         Condensed Consolidated Balance Sheet as of June 30, 2005
          (unaudited)                                                          3
         Condensed Consolidated Income Statement For The Three Months
          And Six Months Ended June 30, 2005 And 2004 (unaudited)              4
         Condensed Consolidated Statement Of Cash Flows For The Three          5
          And Six Months Ended June 30, 2005 And 2004 (unaudited)
         Notes To Condensed Consolidated Financial Statements
         (unaudited)                                                           6

Item 2.  Management's Discussion and Analysis or Plan of Operation            13
Item 3.  Controls and Procedures                                              32

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings                                                    33
Item 2.  Changes in Securities and Use of Proceeds                            33
Item 3.  Defaults Upon Senior Securities                                      33
Item 4.  Submission of Matters to a Vote of Security Holders                  33
Item 5.  Other Information                                                    33
Item 6.  Exhibits and Reports on Form 8-K                                     33
         Signatures                                                           33


                                       2
<PAGE>

                 BonusAmerica Worldwide Corp. and Subsidiaries
                      Condensed Consolidated Balance Sheet
                                   (unaudited)
                                                                     June 30,
                                                                       2005
                                                                   ------------
ASSETS

Current assets:
   Cash and cash equivalents                                       $     20,480

   Restricted cash                                                       20,000
   Accounts receivable                                                1,050,102
   Inventories                                                            5,527
   Amount due from related party                                        199,919
   Prepaid and other current assets                                     112,028
                                                                   ------------
      Total current assets                                            1,408,056

Property, plant, and equipment, net accumulated
 depreciation of $211,894                                               399,603
Intangible assets, net accumulated amortization
 of $451,872                                                            657,675
                                                                   ------------
      Total assets                                                 $  2,465,334
                                                                   ============

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
   Loan from a director                                            $        978
   Accounts payable and accrued liabilities                             477,146

   Income tax payables                                                  196,908
   Amounts due to related party                                         115,426
                                                                   ------------
      Total current liabilities                                         790,458
                                                                   ------------

Stockholders' equity
   Common stock, $0.001 par value; 75,000,000
    shares authorized; 19,862,000
    issued and outstanding                                               19,862
   Other comprehensive income                                              (320)
   Additional paid-in capital                                         1,219,095
   Retained earnings                                                    436,239

                                                                   ------------
      Total stockholders' equity                                      1,674,876

                                                                   ------------
      Total liabilities and stockholders' equity                   $  2,465,334
                                                                   ============

     See accompanying notes to condensed consolidated financial statements


                                       3
<PAGE>

                 BonusAmerica Worldwide Corp. and Subsidiaries
                    Condensed Consolidated Income Statement
                                   (unaudited)

<TABLE>
<CAPTION>
                                                    Three Months Ended            Six Months Ended
                                                --------------------------  --------------------------
                                                  June 30,      June 30,      June 30,      June 30,
                                                    2005          2004          2005          2004
                                                ------------  ------------  ------------  ------------
<S>                                             <C>           <C>           <C>           <C>
Revenues:
Product sales                                         26,302       833,210        40,977     1,585,379
Advertising and list rentals                         623,081       129,733     1,268,348       256,342
                                                ------------  ------------  ------------  ------------
   Total revenues                                    649,383       962,943     1,309,325     1,841,721

Cost of product sales                                166,630       469,983       213,157       867,982
                                                ------------  ------------  ------------  ------------

   Gross profit                                      482,753       492,960     1,096,168       973,739

Selling, general and administrative expenses         279,756       382,252       807,736       724,611

Amortization of intangible assets                     77,089        49,886       151,787        90,713
                                                ------------  ------------  ------------  ------------

Operating earnings                                   125,908        60,822       136,645       158,415

Other income                                          10,219        10,583        14,598        14,994
                                                ------------  ------------  ------------  ------------

Earnings before provision for income taxes           136,127        71,405       151,243       173,409

Provision for income taxes                            64,872        26,576        78,974        71,276
                                                ------------  ------------  ------------  ------------

   Net earnings                                 $     71,255  $     44,829  $     72,269  $    102,133
                                                ============  ============  ============  ============

Basic and diluted earnings per share share:     $       0.00  $       0.00  $       0.00  $       0.01
                                                ============  ============  ============  ============
Basic and diluted weighted average
shares outstanding                                19,862,000    19,862,000    19,862,000    19,862,000
</TABLE>

     See accompanying notes to condensed consolidated financial statements


                                       4
<PAGE>

                 BonusAmerica Worldwide Corp. and Subsidiaries
                 Condensed Consolidated Statement of Cash Flows
                                   (unaudited)

                                                             Six Months Ended
                                                          ---------------------
                                                           June 30,    June 30,
                                                             2005        2004
                                                          ---------   ---------
Cash flows from operating activities:
   Net earnings                                           $  72,269   $ 102,133
   Adjustments to reconcile net earnings to net cash
    provided by operating activities:
      Depreciation and amortization                         218,175     118,770
      Change in income taxes                                 77,651     (71,012)
      Changes in operating assets:
         Accounts receivable                                 39,609      24,140
         Inventories                                        113,029      79,842
         Prepaid and other current assets                   (23,897)    (17,546)
         Accounts payable and accrued liabilities           (95,621)     69,066
                                                          ---------   ---------
         Net cash provided by operating activities          401,215     447,417
                                                          ---------   ---------
Cash flows from investing activities:
   Purchases of equipment                                    (2,515)     (8,745)
   Cash paid for intangible assets                          (47,102)   (185,122)
   Cash received in acquisition                                  --          53
   Issuance of note receivable                                   --     (50,000)
                                                          ---------   ---------
         Net cash used in investing activities              (49,617)   (243,814)
                                                          ---------   ---------
Cash flows from financing activities:
   Loan from a director                                    (300,047)         --
   Advances to related party                               (199,919)

   Amounts payable to related parties                        81,324          --
   Amount due from affiliates                                    --     (25,000)
                                                          ---------   ---------
         Net cash used in financing activities             (418,642)    (25,000)

Increase/(decrease) in cash and cash equivalents            (67,044)    178,603

Effect of foreign currencies on cash flows                     (793)         --

Cash and cash equivalents, beginning of period               88,317          --
                                                          ---------   ---------
Cash and cash equivalents, end of period                  $  20,480   $ 178,603
                                                          =========   =========

     See accompanying notes to condensed consolidated financial statements.


                                       5
<PAGE>

BONUSAMERICA WORLDWIDE CORP. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

NOTE 1 - BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

The accompanying unaudited condensed consolidated financial statements have been
prepared by the Company pursuant to the rules and regulations of the Securities
and Exchange Commission ("SEC") regarding interim financial reporting.
Accordingly, they do not include all of the information and notes required by
accounting principles generally accepted in the United States of America. For
complete financial statements and related notes, refer to the Company's Annual
Report on form 10-KSB for the year ended December 31, 2004, as filed with the
SEC.

The unaudited condensed consolidated financial statements reflect all
adjustments, consisting of normal recurring adjustments, which are, in the
opinion of management, necessary for a fair presentation of results for the
interim periods presented. Preparing financial statements requires management to
make estimates and assumptions that affect the amounts that are reported in the
condensed consolidated financial statements and accompanying disclosures.
Although these estimates are based on management's best knowledge of current
events and actions that the Company may undertake in the future, actual results
may be different from the estimates. The results of operations for the six
months ended June 30, 2005, are not necessarily indicative of the results to be
expected for any future period or the full fiscal year.

The accompanying unaudited financial statements have been prepared in conformity
with generally accepted accounting principles in the United States of America,
which contemplates continuation of the Company as a going concern. The Company
does not presently generate sufficient revenue to fund its operations and it
will continue to require additional capital to continue and expand its business,
the receipt of which cannot be assured. Currently, the Company estimates its
monthly burn rate is approximately $100,000. In view of these matters, the
continued existence of the Company is dependent upon its ability to meet its
financing requirements on a continuing basis and to succeed in its future
operations.

To meet these objectives, the Company is actively taking measures to reduce its
overhead significantly and it believes this will help them to meet their needs
for the next 12 months after June 30, 2005. The Company's ability to execute its
business strategy, depends to a significant degree on its ability to obtain
sufficient and timely future financing. The Company expects to raise additional
capital through an additional offering of its equity securities or by incurring
additional indebtedness in order to support existing operations and expand the
range and scope of its business. There is no assurance that such additional
funds will be available for the Company on acceptable terms, if at all.
Management believes that actions presently taken to revise the Company's
operating and financial requirements provide the opportunity for the Company to
continue as a going concern. The Company's ability to achieve these objectives
cannot be determined at this time. If the Company is unsuccessful in its
endeavors, it may have to cease operations.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation - The consolidated financial statements include the
accounts of the Company and its wholly-owned subsidiaries. All significant
intercompany balances and transactions have been eliminated in consolidation.

Use of estimates - The preparation of financial statements in conformity with
U.S. generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Management makes its best estimate of the ultimate
outcome for these items based on historical trends and other information
available when the financial statements are prepared. Changes in estimates are
recognized in accordance with the accounting rules for the estimate, which is
typically in the period when new information becomes available to management.
Actual results could differ from those estimates.


                                       6
<PAGE>

Cash and cash equivalents - The Company considers all highly liquid instruments
purchased with an original maturity of three months or less to be cash
equivalents. Cash and cash equivalents consist of cash at bank and on hand,
demand deposits with banks and other financial institutions.

Concentration of credit risk - Financial instruments that potentially expose the
Company to a concentration of credit risk are as follows:

Cash held at banks - The Company maintains cash balances at several banks.
Accounts at each institution in the United States are insured by the Federal
Deposit Insurance Corporation up to $100,000.

Geographic sales - The Company operates primarily in the United States, Hong
Kong, and China. The Company's geographic sales as a percent of total revenue
are as follows:

                      Six months ended      Six months ended
                        June 30, 2005         June 30, 2004
United States                3%                   100%
Hong Kong                    20%                   *%
China                        77%                   *%

Accounts receivable - Retail customer accounts are generally settled through
customer credit cards, which are generally collected within three days or less.
Management provides an estimated allowance for returns at the time of sale. The
majority of accounts receivable is from business customers, generated through
advertising services or rentals of its database of customers. Management reviews
credit worthiness of its business customers, and generally does not require
collateral. Historical credit losses have been within management's expectations.

Inventories - Inventories, consisting of retail products ready for sale, are
stated at the lower of cost (first-in, first-out) or market. Allowances are
provided for inventories which are considered slow-moving to reduce amounts to
net realizable or market value. All amounts are considered finished goods for
financial reporting purposes.

Property, plant and equipment - Property, plant and equipment are stated at
historical cost less accumulated depreciation and amortization. Depreciation and
amortization are computed using the straight-line method over the estimated
useful lives of the assets, generally ranging from 3 to 7 years. The cost of
maintenance and repairs is charged to expense as incurred; significant renewals
and betterments are capitalized. Deductions are made for retirements resulting
from renewals or betterments.

Intangible assets - Intangible assets consist of costs paid to acquire personal
customer information for use in its advertising and database rental activities
and costs for formation of websites. Costs capitalized during the six months
ended June 30, 2005 amounted to $47,102, and amortization totaled $151,787
(2004: $90,713). The carrying value at June 30, 2005 was $657,675. The Company
amortizes the cost of these assets over a period ranging from three years to
five years.

Long-lived assets - Statement of Financial Accounting Standards ("SFAS") No.
144, "Accounting for Impairment or Disposal of Long-Lived Assets", requires that
long-lived assets, such as property and equipment and purchased intangibles
subject to amortization, be reviewed for impairment whenever events or changes
in circumstances indicate that the carrying amount of an asset may not be
recoverable, or at least these assets must be reviewed annually. Recoverability
of the asset is measured by comparison of its carrying amount to undiscounted
future net cash flows the asset is expected to generate. Specifically,
management projects undiscounted cash flows from database rentals that are
expected over the period to be benefited. If such assets are considered to be
impaired, the impairment to be recognized is measured as the amount by which the
carrying amount of the asset exceeds its fair market value. Estimates of
expected future cash flows represent management's best estimate based on
currently available information and reasonable and supportable assumptions. Any
impairment recognized in accordance with SFAS No. 144 is permanent and may not
be restored. To date, the Company has not recognized any impairment of
long-lived assets in accordance with SFAS No. 144.


                                       7
<PAGE>

Revenue recognition - The Company recognizes revenue from product sales and
business-to-business wholesale transactions at the time of shipment. An
allowance for estimated returns is provided at the time of sale. Historically,
returns have averaged less than three percent of total sales. Database rentals
are recorded at the time the services are provided so long as the services are
defined and communicated in writing, the price is fixed and determinable, no
other obligations of the Company exist to the customer and the amounts are
collectible.

Advertising - The Company expenses costs of advertising and promotions as
incurred with the exception of direct-response advertising costs. Statement of
Position No. 93-7, "Reporting on Advertising Costs", provides that
direct-response advertising costs that meet specified criteria should be
reported as assets and amortized over the estimated benefit period, which is
generally less than 30 days. The conditions for reporting the direct-response
advertising costs as assets include evidence that customers have responded
specifically to the advertising, and that the advertising results in probable
future benefits. The Company uses direct-response marketing to attract customers
to opt-in to the Company's database and buy goods offered on its website or a
special promotion. The Company is able to document the responses of each
customer to the email advertising that elicited the response. The percentage of
costs attributable to future rental revenues are segregated and reported as
intangible assets. For the six months ended June 30, 2005, direct-response
advertising costs attributable to product sales and future estimated database
rentals were 44% and 56%, respectively. Advertising expenses included in selling
and marketing expenses for the six months ended June 30, 2005 were approximately
$39,608 (2004: $145,450).

Accounting for stock-based compensation - The Company has not adopted a fair
value-based method of accounting for stock-based compensation plans for
employees and non-employee directors. The Company will use the intrinsic
value-based approach, and supplement disclosure of the pro forma impact on
operations and per share information using the fair value-based approach as
required by SFAS No. 148 "Accounting for Stock-Based Compensation - Transition
and Disclosure". Stock-based compensation issued to non-employees and
consultants are measured at fair value in accordance with SFAS No. 123. Common
stock purchase options and warrants issued to non-employees and consultants will
be measured at fair value using the Black-Scholes valuation model.

Earnings per share - The Company presents basic earnings per share ("EPS") and
diluted EPS on the face of all statements of operations. Basic EPS is computed
as net earnings divided by the weighted average number of common shares
outstanding for the period. Diluted EPS reflects the potential dilution that
could occur from common shares issuable through stock options, warrants, and
other convertible securities. There were no dilutable securities outstanding
during the periods presented, thus diluted EPS is the same as basic EPS.

Foreign currency translation - The reporting currency used in the preparation of
these consolidated financial statements is United States Dollars (USD). The
functional currency of the Company's subsidiary operating in Hong Kong is Hong
Kong Dollars (HKD) and its financial records are maintained and its statutory
financial statements are prepared in HKD. The functional currency of the
Company's subsidiary established in the PRC is Renminbi (RMB) and its financial
records are maintained and its financial statements are prepared in RMB.

Transactions in foreign currencies are translated at exchange rates ruling at
the transaction dates. Monetary assets and liabilities expressed in foreign
currencies at the balance sheet date are translated at rates of exchange ruling
at the balance sheet date. Exchange differences arising in these cases are
included in net income on the statement of operations.

The translation of the consolidated financial statements into USD is performed
for balance sheet accounts using the closing exchange rate in effect at the
balance sheet date and for revenue and expenses using an average exchange rate
during each reporting period. The resulting foreign currency translation gain or
loss is included in other comprehensive income in the equity section of the
balance sheet.


                                       8
<PAGE>

Income taxes - The provision for income taxes has been reflected in the
consolidated income statement as if the Company had filed separate tax returns
as an independent company. The Company's results of operations were included in
the federal income tax returns of Stanford. Stanford and BonusAmerica do not
have a formal tax-sharing arrangement, and Stanford is treating the taxes paid
on BonusAmerica income as a capital contribution and will not be repaid to
Stanford. BonusAmerica uses the asset and liability method of accounting for
income taxes. Under this method, deferred tax assets and liabilities are
recognized for estimated future tax consequences attributable to differences
between the financial statement carrying amounts of existing assets and
liabilities and their respective tax bases. Deferred tax assets and liabilities
are measured using enacted tax rates in effect for the year in which those
temporary differences are expected to be recovered or settled. The resulting
deferred tax assets and liabilities are adjusted to reflect changes in tax laws
or rates in the period of enactment. Deferred tax assets are reviewed for
realization and valuation allowances are recorded if it is deemed more likely
than not that some or all of the deferred tax assets will not be realized.

Comprehensive income - The Company includes items of other comprehensive income
by their nature in a financial statement and displays the accumulated balance of
other comprehensive income separately from retained earnings and additional
paid-in capital in the equity section of the balance sheet. Other comprehensive
income consists of cumulative translation adjustments.

Fair value of financial instruments - Financial instruments include cash and
cash equivalents, restricted cash, accounts receivable, accounts payable and
other accrued expenses, amounts due to / from related parties and amounts
payable to director. The carrying value approximate their fair values because of
their short-term nature.

Related party transactions - A related party is generally defined as (i) any
person that holds 10% or more of the Company's securities and their immediate
families, (ii) the Company's management, (iii) someone that directly or
indirectly controls, is controlled by or is under common control with the
Company, or (iv) anyone who can significantly influence the financial and
operating decisions of the Company. A transaction is considered to be a related
party transaction when there is a transfer of resources or obligations between
related parties.

Recent Accounting Pronouncements

      In December 2004, the FASB issued SFAS No. 123 (Revised 2004) "Share-Based
Payment" ("SFAS No. 123R"). SFAS No. 123R addresses all forms of share-based
payment ("SBP") awards, including shares issued under employee stock purchase
plans, stock options, restricted stock and stock appreciation rights. SFAS No.
123R will require the Company to expense SBP awards with compensation cost for
SBP transactions measured at fair value. On March 29, 2005, the SEC issued Staff
Accounting Bulletin (SAB) 107 which expresses the views of the SEC regarding the
interaction between SFAS No. 123R and certain SEC rules and regulations and
provides the SEC's views regarding the valuation of share-based payment
arrangements for public companies. In April 2005, the SEC issued a release which
amends the compliance dates for SFAS No. 123R. We do not expect the adoption of
SFAS No. 123R and SAB 107 to have a material impact on the Company's financial
statements.

      In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error
Corrections". SFAS No. 154 replaces APB Opinion No. 20 "Accounting Changes" and
SFAS No. 3, "Reporting Accounting Changes in Interim Financial Statements". SFAS
No. 154 requires retrospective application to prior periods' financial
statements of changes in accounting principle, unless it is impracticable to
determine either the period-specific effects or the cumulative effect of the
change. We do not expect the adoption of SFAS No. 154 to have any impact on the
Company's financial statements.

NOTE 2 - SEGMENT INFORMATION

The Company has three main operating segments. The primary operating segment of
the Company is advertising and list rental, which generated the majority of the
Company's revenues. Approximately 97% of the revenues came from this segment for
the six months ended June 30, 2005. The other segments, retail and wholesale,
generated 3% of the Company's revenues for the six months ended June 30, 2005
and 14% for the six months ended June 30, 2004.


                                       9
<PAGE>

Segment information is as follows for the six months ended June 30, 2005 and
June 30, 2004:

<TABLE>
<CAPTION>
June 30, 2005
---------------------------------------------------------------------------------------------------------------------------------
                            Product sales                             Advertising and
                              Wholesale              Retail             list rentals           Corporate             Total
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------
<S>                      <C>                  <C>                   <C>                  <C>                  <C>
Total revenues           $                --  $            40,977   $         1,268,348  $                --  $         1,309,325
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------
Operating income (loss)                   --             (418,468)              555,113                   --              136,645
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------
Total assets             $                --  $           323,647   $         2,141,687  $                    $         2,465,334
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------

June 30, 2004
---------------------------------------------------------------------------------------------------------------------------------
                            Product sales                             Advertising and
                              Wholesale              Retail             list rentals           Corporate             Total
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------
Total revenues           $           827,424  $           757,955   $           256,342  $                --  $         1,841,721
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------
Operating income (loss)              379,500             (241,264)               20,179                   --              158,415
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------
Total assets             $                --  $           850,889   $           497,677  $           207,326  $         1,555,892
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------

Segment information is as follows for the three months ended June 30, 2005 and
June 30, 2004:

June 30, 2005
---------------------------------------------------------------------------------------------------------------------------------
                            Product sales                             Advertising and
                              Wholesale              Retail             list rentals           Corporate             Total
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------
Total revenues           $                --  $            26,302   $           623,081  $                --  $           649,383
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------
Operating income (loss)                   --             (220,610)              346,517                   --              125,908
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------

June 30, 2004
---------------------------------------------------------------------------------------------------------------------------------
                            Product sales                             Advertising and
                              Wholesale              Retail             list rentals           Corporate             Total
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------
Total revenues           $           427,584  $           405,626   $           129,733  $                --  $           962,943
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------
Operating income (loss)  $           192,750  $          (147,201)  $            15,273  $                --  $            60,822
-----------------------  -------------------  -------------------   -------------------  -------------------  -------------------
</TABLE>


                                       10
<PAGE>

NOTE 3 - COMMITMENTS AND CONTINGENCIES

Litigation

The Company is subject to a limited number of claims and actions that arise in
the ordinary course of business. The litigation process is inherently uncertain,
and it is possible that the resolution of the Company exists and future
litigation may adversely affect the Company. Management is unaware of any
matters that may have material impact on the Company's financial position,
results of operations or cash flows.

Employment contract

On January 1, 2004, the Company entered into an employment agreement with its
chief executive officer which provides for an annual salary of $100,000, plus
bonuses of up to 1% of base salary. On January 15, 2004, the Company amended the
employment agreement to adjust the salary to $60,000 per year plus bonuses of up
to 1% of net sales of BonusAmerica over and above $10 million, valid for one
year. The contract was amended to approximate the fair value of services
rendered.

For the six months ended June 30, 2005, the Company's chief executive officer's
salary charged to operations was $30,000 (2004: $24,500).

NOTE 4 - RELATED-PARTY TRANSACTIONS

Facilities

On March 1, 2004, the Company began renting warehouse and office facilities from
Stanford on a month-to-month basis at $6,000 per month. In July, 2004, the
Company's monthly rental obligation decreased to $3,500. During the six months
ended June 30, 2005, payments to Stanford related to rent were $21,000 (2004:
$26,610).

Database Rentals

The Company rents its customer database to other divisions of Stanford. Rents
charged are based on 15% of revenues generated from the use of the database.
During the six months ended June 30, 2005, the Company generated revenues of
$2,093 (2004: $10,291) from its database rentals.

Professional Staff Leased

On February 12, 2004, the Company entered into an agreement to pay Stanford a
percentage of employee compensation based upon the percentage of employee hours
used by the Company in 2003. In connection therewith, Stanford will charge the
Company 68% of its total employee costs from January to March 2004. As of April
1, 2004, BonusAmerica started paying its own employment cost. During the six
months ended June 2005, the Company incurred $0 (2004: $174,145) related to the
leasing of professional staff.

Fixed Assets Rentals

On February 20, 2004, the Company agreed to lease property and equipment to
Stanford based on a reasonable and agreed upon charge. Lease charges were
approximately 25% of the depreciation expense in 2004. The same percentage is
used for 2005 since the agreement between the Company and Stanford includes no
agreed upon percentage. During the six months ended June 30, 2005, fixed asset
rental income was $8,700 (2004: $8,700).


                                       11
<PAGE>

Amount Due From Affiliate

The Company advanced $199,919 to Stanford, an affiliated company, during the six
months ended June 30, 2005. The advances are non interest bearing, unsecured and
repayable on demand.

Amount due to related party

Amount due to a related party of $115,426 represents $40,089 due to Michael Mak,
the Company's President and Chief Executive Officer, for expenses paid on behalf
of BonusAmerica payable on demand, and $75,337 due to Megamooch (an entity
partially owned by Michael Mak) from Sino-Trade, payable on demand.


                                       12
<PAGE>

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

                           FORWARD LOOKING STATEMENTS

      The information in this discussion contains forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. These
forward-looking statements involve risks and uncertainties, including statements
regarding our capital needs, business strategy and expectations. Any statements
contained herein that are not statements of historical facts may be deemed to be
forward-looking statements. In some cases, you can identify forward-looking
statements by terminology such as "may", "will", "should", "expect", "plan",
"intend", "anticipate", "believe", "estimate", "predict", "potential" or
"continue", the negative of such terms or other comparable terminology. Actual
events or results may differ materially. We disclaim any obligation to publicly
update these statements, or disclose any difference between its actual results
and those reflected in these statements. The information constitutes
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995.

                                    OVERVIEW

      We are a direct marketing, Internet commerce and media company based out
of Los Angeles, California with operations in Hong Kong and China. We are
currently engaged primarily in international business-to-business media and
advertising services wherein we provide manufacturers and other businesses in
China and Hong Kong - who desire to increase their export sales - with eCommerce
solutions, and direct response advertising via multiple advertising distribution
channels. Originally we were also involved in consumer marketing mostly via
Internet, but have phased out our Online Retail businesses in order to focus on
our Media and Advertising business. We will retain our consumer database and our
online retailing system.

      Our Media and Advertising business offers manufacturers and marketers -
who are primarily located in China and Hong Kong - various direct response
marketing vehicles and ecommerce solutions to help these businesses increase
their export marketing sales. Specifically we offer email marketing, website
design & hosting, online promotions, printed advertising in our quarterly
industrial magazine and direct mailing services. In the fourth quarter of 2004
we launched TradeDragon, our international Business-to-Business trade portal
which links member businesses that are interested in developing or expanding
operations in the United States and China markets, with complementary members of
TradeDragon.

      We currently have offices in Los Angeles, Hong Kong and China. The offices
in Hong Kong and China are operated through our wholly-owned subsidiary, Sino
Trade - Intelligent Development Corp. LTD., an organization formed under the
laws of Hong Kong, or Sino Trade.

      Online Retailing

      We originally established our Online Retailing division in 2002 through
our BonusAmerica web site located at www.BonusAmerica.com. This division has
been phased out. The BonusAmerica website offered a collection of low cost
($9.99 - $99.99) household products, electronics, fashion accessories, personal
interest items and other general merchandise directly to retail and wholesale
consumers located in the United States. We will retain our opted-in consumer
database and our online retailing infrastructure.

      Media and Advertising Division

      In 2003, we began operations of our online media and advertising
distribution network. We generate media and advertising revenue by charging
advertisers for: (i) distributing their advertisements on our online shopping
and coupon portals (B2C); and (ii) allowing them to market directly to our
subscribers in our Opted-In database who have opted to receive offers such as
those offered by the advertisers. Our Media and Advertising division initially
included www.CouponsRewardsSavings.com, which is currently inactive. Based upon
our original success with www.CouponsRewardsSavings.com, we expanded our media
and advertising division to include business-to-business media and advertising
sales. Currently we are focusing only on selling our business-to-business Media
and Advertising services to companies in Hong Kong and China who are seeking to
improve their export business. We have plans for other operations, however these
plans are currently on hold until the company has adequate capital to fund their
growth.


                                       13
<PAGE>

      Consumer Database List Rentals. We have a proprietary and growing
"Opted-In" subscriber database of approximately 15 million e-mail and over 3
million postal addresses. Selected advertisers are charged a rental fee each
time one of their sales messages is delivered to an Opted-In subscriber. We
charge advertisers a per email or postal address fee which varies depending upon
the level of screening desired by the advertiser.

      TradeDragon. TradeDragon was launched in the fourth quarter of 2004 and is
a B2B trade portal that connects businesses that desire to trade between China
and the United States. Supplier members are charged a membership fee to
participate in TradeDragon. TradeDragon members connect with each other through
the TradeDragon.com website, which allows them to search for buyers and
suppliers that match their specific requirements.

      TradeDragon initially will target: (i) U.S.-based buyers seeking to buy
from suppliers in China; and (ii) China-based suppliers seeking to sell to the
United States. Thereafter, we intend to target U.S.-based businesses that desire
to conduct business in China through the export of goods and services and/or
establish partnership arrangements with retailing or selling partners in China.
Through our proprietary system called DragonDynamicsTM, we are able to drive
both buyer and seller side traffic to our TradeDragon portal. We intend to
generate revenue from companies that wish to sell to or partner with companies
in the U.S. and/or China through the sale of TradeDragon memberships and
ancillary products and services. Memberships, products and services are sold via
direct marketing, trade publication advertising and through our existing sales
force in China and Hong Kong.

      TradeDragon members benefit from our proprietary business system,
DragonDynamics(TM), which drives custom-tailored online business traffic to each
individual member based on that member's specific requirements.
DragonDynamics(TM) was developed internally by us based on a combination of our
proprietary industry knowledge and our direct marketing expertise and other
trade secrets.

      TradeDragon was launched on schedule. The website is active. Because the
company has not yet raised the funding necessary to implement a full rollout,
management expects minimal sales until such a rollout can be funded.

      BonusChina.com Portal (Planned). BonusChina will be an online portal and
will provide entertainment, information and services to the consumer market in
China. We intend to generate revenue by selling advertising space and services
to consumers and advertisers. We believe that our experience in direct
marketing, our relationships with companies in China and the U.S., our
understanding of the Chinese culture and our local presence in China will enable
us to duplicate our success in the Chinese Internet market. This portal will
remain in the planning stage until management determines that adequate resources
are available to implement and operate the portal profitably.

      Given the success of our Media and Advertising business in Hong Kong and
China, and the potential for future growth therein, management intends to
continue to concentrate resources in this area and as such, in the foreseeable
future, plans to expand the Media and Advertising business, particularly in Hong
Kong and China, as a means of generating profit.

      Sales and Marketing Plan

      We are concentrating our limited marketing budget on the sales of our
Media and Advertising services, particularly in Hong Kong and China where
success has already been demonstrated. These services are sold by the sales
force in China with support from a small staff in the Los Angles office.

      We plan to launch a TradeDragon marketing campaign when and if sufficient
funds and resources are available.


                                       14
<PAGE>

      Our Competitors

      We face intense competition in our current operating divisions: Online
Retailing and Media and Advertising. Many of our competitors have substantially
greater financial, manufacturing, marketing, distribution and technical
resources than we do. Our BonusAmerica.com business directly competes with
direct marketers such as Sharper Image (an international and national specialty
retailer-NASDAQ:SHRP) and Hammacher Schlemmer (a New York based catalog
specialty retailer). Our TradeDragon.com business trading portal competes with
Alibaba.com (a global trade portal and provider of online marketing services for
importers and exporters) and GlobalSources.com (a business-to-business media
company that facilitates global trade, focusing on the China market-NASDAQ:
GSOL).

      Many of our current and potential competitors are larger companies with
greater financial resources, marketing, technical management and other resources
than we do. Some of our competitors have and may continue to use aggressive
pricing or inventory availability practices and devote substantially more
resources to their online operations and system development than us. New
technologies and the expansion of existing technologies may also decrease the
barriers to entry into our business or otherwise increase the competitive
pressure that we face.

      Seasonality

      Our business-to-business Media and Advertising business does not have the
seasonality fluctuations as did our now-phased-out online retailing business.

      Facilities

      On March 1, 2004, we began renting warehouse and office facilities
consisting of approximately 5,000 square feet from Stanford (which leases the
premises from Anjac) on a month-to-month basis at $6,000 per month. In July
2004, our monthly rental obligation decreased to $3,500. During the three and
six months ended June 30, 2005, payments to Stanford related to rent were
$10,500 and $21,000, respectively.

      Employees

      As of June 30, 2005, we employed approximately 27 fulltime associates and
42 commissioned salespeople. We consider our associate relations to be good.

      Available Information

      Our Internet address is www.BonusAmerica.com/bacorp. Information on our
Web site is not incorporated into this annual report.

                            FUTURE PLAN OF OPERATIONS

      Our business consists of two divisions: Online Retailing and Media and
Advertising. As of the date of this Report both divisions are operational,
though the Online Retailing division is in the process of winding down.
Strategically, we have shifted our business focus to our Media and Advertising
division and away from our Online Retailing business as we believe our
business-to-business Media and Advertising division, particularly in Hong Kong
and China where we experienced profits in 2004 and in the first and second
quarters of 2005, holds the greater potential for growth and profitability in
the short and long term. We plan to eventually phase out our current Online
Retail business. We will retain our consumer database which has 15 million
opted-in email subscribers and 3 million postal addresses. We will also retain
our online retail infrastructure. Our online retailing system is the result of
many years of in-house development and hundreds of thousands of real-world
customer transactions. Our ecommerce system is of great value and can be applied
to nearly any online retail application. As such we will maintain this system
for potential future use if and when management believes resources and profit
opportunity are available.

      During the three months ended June 30, 2005, we had revenues of $649,383
with an operating profit of $125,908. We have improved the focus of our sales
force in China and Hong Kong. The sales force is selling our media and
advertising services to businesses located in China and Hong Kong who desire to
improve their export sales via the use of our business-to-business advertising
and media services. Our sales force effectiveness has improved and our cost per
order is lower as a result. Hence, our overall earnings in this area are
improved. We are in the process of seeking additional financing to forward our
business plan, but have not entered into any agreements to obtain such
financing. There is no assurance that such financing will be available, or if
available, that such financing will be available on reasonable terms. Even if we
do obtain such financing, there is no assurance that we will be able to generate
profitable operations.


                                       15
<PAGE>

      Because we have not yet raised the funding we believe is required to
rollout our complete business plan, we have taken, and are continuing to take,
steps to reduce our operating costs. We have moved a significant portion of our
U.S. operations to China where we have benefited from lower overhead costs and
further capitalized on the growth potential in our Media and Advertising
business in Hong Kong and China. Some management and marketing operations will
remain in the U.S. We have also closed some offices in China and consolidated
manpower into fewer offices.

      Due to our shift away from our Online Retailing, during the three months
ended June 30, 2005, our Online Retailing division generated 4% of our revenues
while 96% of our revenues were generated by our Media and Advertising division.
Over the next twelve months, we plan to continue to devote our resources to
expanding and further developing our Media and Advertising division.

      The following table sets forth our net revenues by each operational
division for the three months ended June 30, 2005 and 2004:

                                   Three Months Ended June 30
                                  ---------------------------
                                      2005            2004         Variance
                                  -----------     -----------     -----------
      Online Retailing            $    26,302     $   833,210     - $ 806,908
      Media and Advertising       $   623,081     $   129,733     + $ 493,348
      -----------------------------------------------------------------------
                      Total       $   649,383     $   962,943     - $ 313,560

      There are two primary reasons for lowered overall revenue this quarter
when compared with the same three month period in 2004. First is the
abovementioned shifting of focus to Adverting and Media business and away from
Online Retailing. This shift is fully in progress and hence we have
significantly lowered our Online Retailing revenues. Our Media and Advertising
business is significantly increased as a result of refocusing our resources on
this segment of our business. The second reason for our lowered revenues, when
compared to the previous year, is that we have not yet obtained the additional
funding we are seeking to increase the growth rate of our Advertising and Media
business. These funds, if and when they are raised, will be used to further
promote our Media and Advertising business.

      One example of how we plan to utilize additional funding, if we raise it,
is to promote our new TradeDragon business. In the fourth quarter of 2004 we
launched TradeDragon, a business-to-business trade portal in our Media and
Advertising division. TradeDragon is a communications platform that enables
international trade primarily between companies located in the U.S. and China.
TradeDragon is active, however we have not yet fully developed and marketed our
TradeDragon portal pursuant to our business plan given that adequate funding for
marketing, continued development and administrative support has not been raised.
If and when adequate funding is raised, we intend to focus on operating,
administering and expanding our TradeDragon trade portal. We also intend to
implement new sales efforts in China to help generate sales for TradeDragon. As
we expand operations in this area, we expect to generate increased revenues.

                              RESULTS OF OPERATIONS

           THREE MONTHS ENDED JUNE 30, 2005 COMPARED TO JUNE 30, 2004

Revenues


                                       16
<PAGE>

A.    Online Retailing

      During the three month period ended June 30, 2005, we derived $26,302, or
      4% of our total revenue, from our Online Retailing operations,
      representing a 97% decrease from the comparable three month period ending
      June 30, 2004. The decrease in our retail product sales is attributable to
      our election to reduce the marketing and advertising of our Online Retail
      business in an attempt to focus on building our more profitable Media and
      Advertising division.

B.    Media and Advertising

      During the three month period ended June 30, 2005, we derived $623,081, or
      96%, of our total revenue, from our Media and Advertising division, a
      380%, increase from the comparable three month period ending June 30,
      2004. This increase is attributable to our increased focus on building our
      Media and Advertising business.

Cost of Sales

      Cost of sales were $166,630 for the three month period ended June 30, 2005
as compared to $469,983 for the three month period ended June 30, 2004. The
decrease in costs for the three month period ended June 30, 2005 is attributable
to lower advertising expenses for our Online Retailing business which is in line
with our strategic shift of resources away from Online Retailing and to
Advertising and Media.

Administrative Expenses

      Selling, general and administrative expenses were $263,030 for the three
month period ended June 30, 2005 as compared to $287,251 for the three month
period ended June 30, 2004. The decrease in expenses during the three month
period ended June 30, 2005 was primarily attributable to the planned overhead
cutbacks in all operations.

Marketing Expenses

      Total marketing expenses were $93,815 for the three month period ended
June 30, 2005 as compared to $144,887 for the three month period ended June 30,
2004. The decrease in marketing expenses for the three month period ended June
30, 2005 as compared to June 30, 2004 was due to the elimination of promotional
spending for Online Retailing.

Net Income/Loss

      Our Online Retailing operations had net losses of $220,610 for the three
month period ended June 30, 2005 as compared to a net loss of $147,201 for the
three month period ended June 30, 2004. The operating loss reflects the
anticipated lower sales due to refocusing resources to our Advertising and Media
operations. We believe that operating losses from our Online Retailing
operations will decrease as we continue to take actions to reduce overhead and
expenses relating to Online Retailing.

      Operating income from our Media and Advertising operations was $346,517
for the three month period ended June 30, 2005 as compared to $15,273 for the
three month period ended June 30, 2004. The operating income reflects increased
Media and Advertising sales. We believe that our operating income will continue
to increase as we expand our Media and Advertising operations. There can be no
assurance that we will achieve or maintain profitability or that any revenue
growth will take place in the future even if we do obtain the financing that we
seek.

            SIX MONTHS ENDED JUNE 30, 2005 COMPARED TO JUNE 30, 2004

Revenues

A.    Online Retailing

      During the six month period ended June 30, 2005, we derived $40,977, or 3%
      of our total revenue, from our Online Retailing operations, representing a
      97% decrease from the comparable six month period ending June 30, 2004.
      The decrease in our retail product sales is attributable to our election
      to reduce the marketing and advertising of our Online Retail business in
      an attempt to focus on building our more profitable Media and Advertising
      division.


                                       17
<PAGE>

B.    Media and Advertising

      During the six month period ended June 30, 2005, we derived $1,268,348, or
      97%, of our total revenue, from our Media and Advertising division, a
      395%, increase from the comparable six month period ending June 30, 2004.
      This increase is attributable to our increased focus on building our Media
      and Advertising business.

Cost of Sales

      Cost of sales were $213,157 for the six month period ended June 30, 2005
as compared to $867,982 for the six month period ended June 30, 2004. The
decrease in costs for the six month period ended June 30, 2005 is attributable
to lower advertising expenses for our Online Retailing business which is in line
with our strategic shift of resources away from Online Retailing and to
Advertising and Media.

Administrative Expenses

      Selling, general and administrative expenses were $768,128 for the six
month period ended June 30, 2005 as compared to $546,525 for the six month
period ended June 30, 2004. The increase in expenses during the six month period
ended June 30, 2005 was primarily attributed to increased administrative
staffing and costs related to our Sino Trade subsidiary (prior to the planned
cutbacks in all operations).

Marketing Expenses

      Total marketing expenses were $191,395 for the six month period ended June
30, 2005 as compared to $268,799 for the three six month period ended June 30,
2004. The decrease in marketing expenses for the six month period ended June 30,
2005 as compared to June 30, 2004 was due to the elimination of promotional
spending for Online Retailing.

Net Income/Loss

      Our Online Retailing operations had net losses of $418,468 for the six
month period ended June 30, 2005 as compared to a net loss of $241,264 for the
six month period ended June 30, 2004. The operating loss reflects the
anticipated lower sales due to refocusing resources to our Advertising and Media
operations. We believe that operating losses from our Online Retailing
operations will decrease as we continue to take actions to reduce overhead and
expenses relating to Online Retailing.

      Operating income from our Media and Advertising operations was $555,113
for the six month period ended June 30, 2005 as compared to $20,179 for the six
month period ended June 30, 2004. The operating income reflects increased Media
and Advertising sales. We believe that our operating income will continue to
increase as we expand our Media and Advertising operations. There can be no
assurance that we will achieve or maintain profitability or that any revenue
growth will take place in the future even if we do obtain the financing that we
seek.

Trends, Events, and Uncertainties

      Demand for our products will be dependent on, among other things, market
acceptance of our concept and general economic conditions, which are cyclical in
nature. Our business operations may be adversely affected by our competitors and
prolonged recessionary periods. We are in the process of seeking additional
financing to forward our business plan, but have not entered into any agreements
to obtain such financing. There is no assurance that such financing will be
available, or if available, that it will be available on reasonable terms. Even
if we do obtain such financing, there is no assurance that we will be able to
generate profitable operations.

                        LIQUIDITY AND CAPITAL RESOURCES.

      Net cash flows from operating activities amounted to $401,215 for the six
month period ended June 30, 2005 versus $447,417 for the comparable period in
2004. These amounts were largely driven by net income of $72,269 (2004:
$102,133) offset by non-cash items such as depreciation and amortization of
$218,175 (2004: $118,770).


                                       18
<PAGE>

      We have funded our cash needs from inception through June 30, 2005 and to
the date of this Report through positive cash flow and contributions from
related parties. Our future liquidity will depend on our revenue growth and our
ability to sell our products and services at positive gross margins and control
our operating expenses. Over the coming twelve months, we expect to spend
approximately $1,200,000 for operating expenses assuming revenue growth and no
significant change in marketing or product development strategies. We expect to
meet these capital needs from sales revenues and, to the extent we do not have
sufficient revenues, from our existing cash reserves or other external sources
of financing.

      Our growth plans require additional funding from outside sources. We
intend to pursue discussions with existing shareholders, third party financing
sources and potential lenders to ensure access to funds as required.

      On a long-term basis, our liquidity will be dependent on establishing
profitable operations, receipt of revenues, additional infusions of capital and
additional financing. If necessary, we may raise capital through an equity or
debt offering. The funds raised from this offering will be used to develop and
execute our business plan. However, there can be no assurance that we will be
able to obtain additional equity or debt financing in the future, if at all. If
we are unable to raise additional capital, our growth potential will be
adversely affected. Additionally, we will have to significantly modify our
plans.

                          CRITICAL ACCOUNTING POLICIES

      The financial statements are prepared in accordance with accounting
principles generally accepted in the U.S., which requires us to make estimates
and assumptions in certain circumstances that affect amounts reported in the
accompanying financial statements and related footnotes. In preparing these
financial statements, management has made its best estimates and judgments of
certain amounts included in the financial statements, giving due consideration
to materiality. We do not believe there is a great likelihood that materially
different amounts would be reported related to the accounting policies described
below. However, application of these accounting policies involves the exercise
of judgment and use of assumptions as to future uncertainties and, as a result,
actual results could differ from these estimates.

      Allowance for Doubtful Accounts. Accounts receivable are reviewed to
determine the need for an allowance for amounts that may become uncollectible in
the future. The necessity of an allowance is based on management's review of
accounts receivable balances and historic write-offs. In the event that our
accounts receivables become uncollectible, we would be forced to record
additional adjustments to receivables to reflect the amounts at net realizable
value. The accounting effect of this entry would be a charge to income, thereby
reducing our net profit. Although we consider the likelihood of this occurrence
to be remote based on past history and the current status of our accounts, there
is a possibility of this occurrence.

                                  RISK FACTORS

      The following are important factors that could cause actual results to
differ materially from those anticipated in any forward-looking statements made
by or on behalf of the Company.

      Risks Related To Our General Operations

      We Will Need Additional Capital to Expand and Develop Our Business. We are
presently only generating minimal revenue from our Online Retailing operations.
Until such time as our Online Retailing and Media and Advertising divisions
generate sufficient revenue to fund our operations, we will continue to require
additional capital to continue and expand our business, the receipt of which
cannot be assured. Currently, we have a monthly burn rate of approximately
$100,000. We believe that we have sufficient capital derived from the proceeds
of our operations to meet our needs for the next 12 months after June 30, 2005,
however, we are actively taking measures to reduce our overhead significantly,
which we believe will enable us to meet our needs for the next 12 months after
June 30, 2005. Our ability to execute our business strategy depends to a
significant degree on our ability to obtain sufficient and timely future
financing.


                                       19
<PAGE>

      Our long-term capital needs are subject to our ability to raise additional
capital and to generate adequate revenue from our products and services, neither
of which can be assured. We are actively seeking additional funds and may obtain
such funds through an additional offering of our equity securities or by
incurring additional indebtedness. We cannot assure you that any additional
funds will be available or that sufficient funds will be available to us or that
funds will be available in a timely way. Additional funds may not be available
on terms acceptable to us or our security holders. Any future capital that is
available may be raised on terms that are dilutive to our security holders.

      We Have Only Been Operating Our Online Business Since 2002 and Face
Challenges Related to Early Stage Companies in Rapidly Evolving Markets. We
began our online operations in 2002. You should consider our prospects in light
of the risks and difficulties frequently encountered by early stage companies in
the rapidly evolving online commerce market. These risks include, but are not
limited to, an unpredictable business environment, the difficulty of raising
working capital, the difficulty of attracting and retaining qualified management
personnel and the use of our business model. To address these risks, we must,
among other things:

      o     access sufficient capital to fund the implementation of our business
            model;

      o     increase our sales volumes and gross margins while limiting our
            operating expenses;

      o     expand our customer base;

      o     enhance our brand recognition;

      o     expand our product and service offerings;

      o     access sufficient product inventory to fulfill our customers'
            orders;

      o     successfully implement our business and marketing strategy;

      o     provide high quality customer service and order processing;

      o     respond effectively to competitive and technological developments;
            and

      o     attract and retain qualified personnel.

      The Success of Our Business Depends on the Continued Growth of the
Internet, Especially in the U.S. and Chinese Markets, as a Viable Commercial
Marketplace. Our success depends upon the widespread acceptance of the Internet
as a vehicle to purchase products. The e-commerce market is at an early stage of
development, and demand and continued market acceptance is uncertain. We cannot
predict the extent to which customers will shift their purchasing habits from
traditional to online retailers. If customers or manufacturers are unwilling to
use the Internet to conduct business and exchange information, our business will
fail. It is possible that the Internet may not become a viable long-term
commercial marketplace due to the potentially inadequate development of the
necessary network infrastructure, the delayed development of enabling
technologies and performance improvements and the high cost of shipping
products. The commercial acceptance and use of the Internet may not continue to
develop at historical rates or may not develop as quickly as we expect. In
addition, concerns over security and privacy may inhibit the growth of the
Internet.

      We Expect That a Significant Portion of Our Revenues Will Be Generated
From Customers and Suppliers in China and the United States. Current Weakness of
the Telecommunications and Internet Infrastructure in China Could Harm Our
Business. The quality of some of the telecommunications and Internet
infrastructure and telephone line availability in China is poor. This may
contribute to lower than expected adoption of many of our services and may cause
usage growth and revenues to fall below expectations. In addition, access fees
may be high, which also contributes to low usage and may adversely affect our
growth and revenues potential.

      Customer Concerns Regarding Security May Deter Use of Our Online Products
and Services and Online Security Risks Could Seriously Harm Our Business. A
significant barrier to e-commerce and online communications is the secure
transmission of confidential information over public networks. Anyone who is
able to circumvent our security measures could misappropriate proprietary
information or cause interruptions in our operations. We may be required to
expend significant capital and other resources to protect against potential
security breaches or to alleviate problems caused by any breach. We rely on
licensed encryption and authentication technology to provide the security and
authentication necessary for secure transmission of confidential information,
including credit card numbers. Advances in computer capabilities, new
discoveries in the field of cryptography, or other events or developments may
result in a compromise or breach of the algorithms that we use to protect
customer transaction data. In the event someone circumvents our security
measures, it could seriously harm our business and reputation, and we could lose
customers. Security breaches could also expose us to a risk of loss or
litigation and possible liability for failing to secure confidential customer
information. Our potential for growth depends on our customers' confidence in
the security of our products and services.


                                       20
<PAGE>

      If Our Portals or Other Services on Our Online Portals Contain Defects, We
May Need to Suspend Further Sales and Services Until We Fix the Defects, and Our
Reputation Could Be Harmed. Our portals depend on software that is complex and
that may contain unknown and undetected defects, errors or performance problems.
We may not discover defects, errors or performance problems that affect our new
or current services or enhancements until after they are deployed. These
defects, errors or performance problems could force us to suspend sales and
services or cause service interruptions which could damage our reputation or
increase our service costs, cause us to lose revenues, delay market acceptance
or divert our development resources, any of which could severely harm our
business.

      The Failure of Outside Parties to Meet Our Service Level and Information
Accuracy Expectations May Make Our Services Less Attractive to Customers and
Harm Our Business. We rely on outside parties for some information, licenses,
product delivery and technology products and services. We rely on third parties
to support, enhance and develop our products and services. Services provided by
third parties include maintaining our communications lines and managing our
network data centers and website development. These relationships may not
continue or we may not be able to develop additional third-party relationships
on acceptable commercial terms, which could cause customer dissatisfaction
and/or a delay in the launch of new features or services. We have no control
over the accuracy, timeliness or effectiveness of the information, products and
services of these outside parties. As a result of outside party actions, we may
fail to provide accurate, complete and current information to our customers in a
timely and satisfactory manner.

      System Interruption and the Lack of Integration and Redundancy in Our
Systems May Affect Our Sales. Our business depends on the efficient and
uninterrupted operation of our computer and communications hardware systems.
Customer access to our websites directly affects the volume of goods we sell and
the services we offer and thus affects our net sales. Any system interruptions
that cause any of our portals or online sites to be unavailable may drive away
buyers and reduce the attractiveness of these sites to advertisers and could
adversely affect our business, financial condition and operating results. We
maintain our computer systems on-site at our offices in Los Angeles and China
and off-site with third party vendors in the United States and China.

      Our computer and communications systems and operations could be damaged or
interrupted by fire, flood, power loss, telecommunications failure, earthquakes,
acts of war or terrorism, acts of God, computer viruses, physical or electronic
break-ins, and similar events or disruptions. Any of these events could cause
system interruption, delays, and loss of critical data, and could prevent us
from accepting and fulfilling customer orders. Should this occur, it would make
our product offerings less attractive to our customers and our service offerings
less attractive to third parties. While we do have backup systems for certain
aspects of our operations, our systems are not fully redundant and our disaster
recovery planning may not be sufficient for all eventualities. In addition, we
may have inadequate insurance coverage or insurance limits to compensate us for
losses from a major interruption. If any of this were to occur, it could damage
our reputation and be expensive to remedy.

      We May Be Subject to Legal Liability for Publishing or Distributing
Content Over the Internet. We may be subject to legal claims relating to the
content on our websites, or the downloading and distribution of such content, as
well as legal claims arising out of the products or companies featured in our
trade publications and tradeshows. Claims could involve matters such as libel
and defamation, patent, trademark, copyright and design infringement, fraud and
invasion of privacy. Media companies have been sued in the past, sometimes
successfully, based on the content published or made available by them. In
addition, some of the content provided on our websites may be manually entered
from data compiled by other parties, including governmental and commercial
sources, and this data may have errors, or we may introduce errors when entering
such data.


                                       21
<PAGE>

      We Could Be Liable for Unlawful or Fraudulent Activities by Users of Our
Online Portals. In operating our online portals such as BonusAmerica and Trade
Dragon, we rely on participants to make accurate representations and provide
reliable delivery, and on buyers to pay the agreed purchase price. We may be
unable to prevent users of our online portals from making unlawful
representations, selling unlawful goods, or from selling goods in an unlawful
manner. We may face civil or criminal liability for unlawful and fraudulent
activities by our users under U.S. laws and the laws and regulations of other
countries. In addition, if we are unsuccessful in preventing our users from
providing content that is either illegal or that violates the proprietary rights
of others, it may result in liability to us. Any costs we incur as a result of
liability relating to the sale of unlawful goods, the unlawful sale of goods,
the fraudulent receipt of goods, or the fraudulent collection of payments could
harm our business.

      If our content is improperly used or if we supply incorrect information,
third parties may take legal action against us. In addition, we may violate
usage restrictions placed on text or data that is supplied to us by third
parties. Our insurance may not cover claims of this type, or may not provide
sufficient coverage, which could harm our reputation and operating results.

      If We Do Not Respond to Technological Change, Our Online Stores and
Portals Could Become Obsolete, and We Could Lose Customers. The Internet and the
e-commerce industry are characterized by rapid technological change, changes in
customer requirements and preferences, frequent new product and service
introductions embodying new technologies, and the emergence of new industry
standards and practices. To remain competitive, we must continue to enhance and
improve the responsiveness, functionality and features of our online stores. If
we are unable to maintain our existing systems and create a positive customer
experience, our revenues may decline and our business will suffer.

      The evolving nature of the Internet could also render our existing online
stores and systems obsolete. Our success will depend, in part, on our ability
to:

      o     license or acquire leading technologies useful in our business;

      o     enhance our existing online stores;

      o     enhance our network infrastructure and transaction processing
            systems;

      o     develop new services and technology that address the increasingly
            sophisticated and varied needs of our current and prospective
            customers; and

      o     adapt to technological advances and emerging industry and regulatory
            standards and practices in a cost-effective and timely manner.

      Future advances in technology may not be beneficial to, or compatible with
our business. Furthermore, we may not use new technologies effectively or adapt
our Web site and transaction processing systems to customer requirements or
emerging industry standards on a timely basis, or at all, depending on our
financial condition. If we are unable to adapt to changing market conditions or
user requirements in a timely manner, our online stores may become obsolete and
we will lose customers.

      We May Be Unable to Protect Our Internet Domain Names, Which are Essential
to Our Business. Our Internet Domain Names are Critical to Our Brand Recognition
and Our Overall Success. We have many registered domain names relating to our
brand, including BonusAmerica.com, TradeDragon, RateandSave and More2Save. The
acquisition and maintenance of domain names generally are regulated by
governmental agencies and their designees. The regulation of domain names in the
United States and in foreign countries has changed and is subject to further
change in the future. As a result, we may be unable to acquire or maintain
relevant domain names in the United States and in other countries where we
conduct business. Furthermore, we may be unable to protect our domain names or
prevent third parties from acquiring domain names that are similar to, infringe
upon or otherwise decrease the value of our domain names, trademarks and other
intellectual property rights. If we are unable to protect these domain names,
our competitors could capitalize on our brand recognition and create confusion
that diverts traffic to other websites away from our online services, thereby
adversely affecting our business.

      We May Be Unable to Adequately Protect Our Intellectual Property Rights,
Which May Reduce Our Ability To Compete And May Divert Our Resources. We regard
our trademarks, service marks, copyrights, patents, trade dress, trade secrets,
proprietary technology, and similar intellectual property as critical to our
success, and we rely on trademark, copyright, and patent law, trade secret
protection, and confidentiality and/or license agreements with our employees,
customers, partners, and others to protect our proprietary rights. Effective
trademark, service mark, copyright, patent, and trade secret protection may not
be available in every country in which our products and services are made
available online.


                                       22
<PAGE>

      Policing unauthorized use of our proprietary rights is inherently
difficult, and we may not be able to determine the existence or extent of any
such unauthorized use. The protection of our intellectual property may require
the expenditure of significant financial and managerial resources. Moreover, we
cannot be certain that the steps we take to protect our intellectual property
will adequately protect our rights. We cannot determine whether future patent,
service mark or trademark applications, if any, will be granted. No certainty
exists as to whether our current intellectual property or any future
intellectual property that we may develop will be challenged, invalidated or
circumvented or will provide us with any competitive advantages. We cannot be
certain that others will not independently develop or otherwise acquire
equivalent or superior technology or other intellectual property rights. If
others are able to develop or use business systems, technologies and/or content
we have developed, our competitive position may be negatively affected.

      Litigation may be necessary to enforce our intellectual property rights,
protect trade secrets, determine the validity and scope of the proprietary
rights of others, or defend against claims of infringement or invalidity.
Intellectual property laws provide limited protection. Moreover, the laws of
some foreign countries do not offer the same level of protection for
intellectual property as the laws of the United States. In addition, we may be
unable to detect unauthorized use of our intellectual property. Litigation may
result in substantial costs and diversion of resources, regardless of its
outcome, which may limit our ability to develop new services and compete for
customers.

      If Third Parties Claim That We Infringe Upon Their Intellectual Property
Rights, Our Ability to Use Technologies and Products May Be Limited, and We May
Incur Substantial Costs to Resolve These Claims. Litigation regarding
intellectual property rights is common in the Internet industry. Defending
against these claims could be expensive and divert our attention from operating
our business. If we become liable to third parties for infringing their
intellectual property rights, we could be required to pay substantial damage
awards and be forced to develop non-infringing technology, obtain a license or
cease using the products and services that contain the infringing technology or
content. We may be unable to develop non-infringing technology or content or to
obtain a license on commercially reasonable terms, or at all.

      We may also be named as a defendant in litigation alleging infringement of
intellectual property rights by our customers. We may be required to defend
ourselves and our customers against infringement claims. In the event of a claim
of infringement, we and our customers may be required to pay significant damages
or obtain one or more licenses from third parties, and we may be unable to
obtain necessary licenses at a reasonable cost or at all. Inability to obtain
licenses may prevent us from offering products and services, which may limit our
revenues.

      We May Not Be Successful in Our Efforts to Expand into International
Market Segments. We plan, over time, to continue to expand our reach into
additional international market segments. It is costly to establish
international facilities and operations, promote our brand internationally and
develop localized websites, stores, and other systems. We may experience
difficulty entering or expanding into new international markets due to greater
regulatory barriers, the necessity of adapting to new regulatory systems and
problems related to entering new markets with different cultural bases and
political systems. We may not succeed in our efforts. Our net sales from
international market segments may not offset the expense of establishing and
maintaining the related operations and, therefore, these operations may not be
profitable on a sustained basis.

      Our international sales and related operations are subject to a number of
risks inherent in selling abroad, including, but not limited to, risks with
respect to:

      o     foreign exchange rate fluctuations;

      o     local economic and political conditions;

      o     restrictive governmental actions (such as trade protection measures,
            including export duties and quotas and custom duties and tariffs and
            those that may limit the our ability to sell certain products,
            provide certain services or repatriate profits to the United
            States);

      o     import or export licensing requirements;


                                       23
<PAGE>

      o     limitations on the repatriation of funds;

      o     difficulty in obtaining distribution and support;

      o     nationalization;

      o     longer receivable cycles;

      o     consumer protection laws and restrictions on pricing or discounts;

      o     lower level of adoption or use of the Internet and other
            technologies vital to our business and the lack of appropriate
            infrastructure to support widespread Internet usage;

      o     lower level of credit card usage and increased payment risk;

      o     difficulty in developing and simultaneously managing a larger number
            of unique foreign operations as a result of distance, language, and
            cultural differences;

      o     laws and policies of the U.S. and other jurisdictions affecting
            trade, foreign investment, and loans;

      o     tax and other laws of the U.S. and other jurisdictions; and

      o     geopolitical events, including war and terrorism.

      These factors could result in a delay in or disruption of the delivery of
our inventory and could have the consequences described above, any of which
could have a material adverse effect on us. As we continue to expand our
international operations, these and other risks associated with international
operations are likely to increase.

      We May Be Subject to Foreign Currency Risks. We expect that a significant
portion of our future revenues will be generated from customers and suppliers in
China and Hong Kong. Because we operate internationally, foreign exchange rate
fluctuations may have a material impact on our results of operations. To the
extent significant currency fluctuations occur in Asian currencies, our revenues
and profits would be affected. Upon translation, net sales and other operating
results may differ materially from expectations, and we may record significant
transaction gains or losses on the remeasurement of our balances. The currencies
giving rise to this risk are primarily Chinese Yaun and the Hong Kong Dollar. We
do not hedge our foreign currency risk. While we believe our current foreign
currency risk to be minimal, there is no assurance that our risk will not
increase, especially in light of our business strategy to expand our
international operations. Even if we do adopt a policy of hedging against our
foreign currency risks, there is no assurance that such policy will be
successful. Our failure to successfully hedge against foreign currency risks may
increase our expenses and have a negative impact on our financial condition.

      Our Growth Could Strain Our Resources, and If We Are Unable to Implement
Appropriate Controls and Procedures to Manage Our Growth, We May Not Be Able to
Successfully Implement Our Business Plan. Our growth strategy primarily includes
the following components:

      o     Expand our customer base for database rentals;

      o     Expand our TradeDragon portal; and

      o     Broaden our sales and marketing channels.

      We plan to increase the number of sales representatives in China in order
to pursue our business objectives. Such growth may place a significant strain on
our management, operational, and financial resources. Our success will depend in
part upon the ability of our senior management to implement and manage this
growth effectively. To do this, new representatives must be recruited and
trained. If our new representatives perform poorly, or if their training and
management is unsuccessful, our business may be harmed. To manage the expected
growth of our operations, we will need to continue to improve our operational,
financial and management controls and our reporting systems and procedures. If
we fail to manage our growth successfully, we will be unable to execute our
business plan.

      The Loss of One or More of Our Executive Officers or Key Employees, Either
to a Competitor or Otherwise, Could Harm Our Business. Our executive officers
and key employees are critical to our business. Our executive officers and key
personnel may not remain with us and their loss may negatively impact our
operations, and may reduce our revenues and cash flows. In particular, the
services of Michael Mak, our chief executive officer and director and John A.
Leper, our Secretary and director, are important to our operations. If
competitors hire our key personnel, it could allow them to compete more
effectively by diverting customers from us and facilitating more rapid
development of their competitive offerings. We compete for qualified personnel
with other companies, academic institutions, government entities and
organizations. We cannot assure you that we will be successful in hiring or
retaining qualified personnel. The loss of key personnel, or an inability to
hire or retain qualified personnel or consultants, could have a material adverse
effect on our business, financial condition and results of operations. We do not
maintain key man insurance on any of our executive officers.


                                       24
<PAGE>

      Risks Related to Government Regulation

      Evolving Regulation of the Internet and Commercial E-Mail May Affect Us
Adversely. As Internet commerce continues to evolve, increasing regulation by
federal, state or foreign agencies becomes more likely. Such existing and future
laws and regulations may impede the growth of the Internet or other online
services. These regulations and laws may cover taxation, user privacy, data
protection, pricing, usage fees, content, copyrights, distribution, electronic
contracts and other communications, consumer protection, the provision of online
payment services, broadband residential Internet access, online advertising and
marketing, and the characteristics and quality of products and services. It is
not clear how existing laws governing issues such as property ownership, sales
and other taxes, libel, and personal privacy apply to the Internet and
e-commerce. Strict legal prohibitions on the transmission of unsolicited
commercial email, coupled with aggressive enforcement, could reduce our ability
to promote our services and our ability to facilitate communications between
suppliers and buyers and, as a result, adversely affect our business. Any
regulation imposing greater fees for Internet use or restricting information
exchange over the Internet could result in a decline in the use of the Internet
and the viability of Internet-based services, which could harm our business and
operating results. The adoption or modification of laws or regulations relating
to the Internet may harm our business by increasing our costs and administrative
burdens. Moreover, the applicability of existing laws to the Internet is
uncertain with regard to many important issues, including property ownership,
intellectual property, export of encryption technology, libel and personal
privacy. The application of laws and regulations from jurisdictions whose laws
do not currently apply to our business, or the application of existing laws and
regulations to the Internet and other online services, could also harm our
business.

      We May Be Subject to Liability for Sales and Other Taxes. We currently
collect sales or other similar taxes on the shipment of goods in the State of
California. However, one or more states could seek to impose additional income
tax obligations or sales tax collection obligations on out-of-state companies,
such as ours, which engage in or facilitate online commerce. Our fulfillment
center, along with other aspects of our evolving business, may result in
additional sales and other tax obligations. One or more states or foreign
countries may seek to impose sales or other tax collection obligations on
out-of-jurisdiction companies that engage in e-commerce. Any new taxes on the
sale of products and services through the Internet or the income derived from
these sales could result in substantial tax liabilities for past sales, decrease
our ability to compete with traditional retailers, impair the growth of
e-commerce and adversely affect our ability to become profitable. Furthermore,
since our service is available over the Internet in multiple states and in
foreign countries, these jurisdictions may require us to qualify to do business
in these states and foreign countries. If we fail to qualify in a jurisdiction
that requires us to do so, we could face liabilities for taxes and penalties.

      Currently, decisions of the U.S. Supreme Court restrict the imposition of
obligations to collect state and local sales and use taxes with respect to sales
made over the Internet. However, a number of states, as well as the U.S.
Congress, have been considering various initiatives that could limit or
supersede the Supreme Court's position regarding sales and use taxes on Internet
sales. If any of these initiatives addressed the Supreme Court's constitutional
concerns and resulted in a reversal of its current position, we could be
required to collect sales and use taxes in states other than Washington, North
Dakota and Kansas. The imposition by state and local governments of various
taxes upon Internet commerce could create administrative burdens for us and
could decrease our future sales.

      Risks Related to Our Online Retailing Business

      Our Business Model is New and Unproven, and We May Not Be Able to Achieve
Profitability. We are subject to risks due to the unproven and evolving nature
of our business model and aggressive pricing strategy. The success of our Online
Retailing business depends on the volume of customers that visit our Web site
and purchase our products, as well as our ability to generate significant online
advertising revenues. To this end, we have worked hard to build our brand name
and enhance our customer loyalty by selling our products at low prices and
maintaining low gross margins on our product sales. We intend to implement
various strategies to improve our gross margins going forward, which may include
raising prices on products and product categories from time to time. To the
extent we raise the prices on our merchandise, our product sales may decline. We
may also have to increase our prices if distributors receive pressure from
manufacturers to discontinue sales to us as a result of our low price strategy.
If the amount of traffic to our Web site decreases due to price increases, a
reduced marketing budget, a weakening demand for our lifestyle products or
otherwise, we may become less attractive to our current and potential
advertisers. As a result, our margins and advertising revenues may decline.


                                       25
<PAGE>

      Our ability to achieve profitability also depends on our ability to
effectively manage our operating costs. If we are unable to manage our operating
expenses, increase our gross margins and increase our sales volumes, we will be
unable to achieve profitability.

      Our Future Growth Will Be Substantially Dependent On the Continued
Increase in Sales Growth of Existing Core and New Products, While at the Same
Time Maintaining or Increasing Our Current Gross Margin Rates. We cannot predict
whether we will be able to increase the growth of existing core and new products
or successfully introduce new products, increase our revenue level or maintain
or increase our gross margin rate in future periods. Failure to do so may
adversely affect our stock price.

      We Must Continue to Develop and Maintain the BonusAmerica Brand, Which is
Costly and May Not Generate Corresponding Revenues. Maintaining and
strengthening the BonusAmerica brand is an important factor in attracting new
customers, building customer loyalty and attracting advertisers. In the past,
our initiatives have involved significant expenditures. However, to achieve
positive operating cash flow, we have reduced the resources allocated to our
promotional strategies. We cannot be certain that our reduced marketing budget
will successfully drive customer acquisition or that this allocation of
resources will provide additional revenues equal to this dedication of our
resources. If our remaining promotional efforts are unsuccessful, we may not be
able to recover these expenses or increase our revenues or margins consistent
with our operating plan. Further, we also believe potential customers and
advertisers are driven to our online store because of our strong brand
recognition. If advertisers do not believe our Web site is an effective
marketing and sales channel for their merchandise, or if customers do not
perceive us as offering a desirable way to purchase merchandise, our branding
efforts will suffer and we may lose customers.

      Our ability to build and strengthen the BonusAmerica brand depends largely
on:

      o     our ability to allocate sufficient marketing dollars on our
            advertising and promotional efforts given our financial position;

      o     the success of our advertising and promotional efforts;

      o     our ability to provide our customers with a broad range of products
            at competitive prices with timely fulfillment; and

      o     our ability to provide high quality customer service.

      Our Distribution and Fulfillment Operations Are Located in Los Angeles,
California. Any Disruption of the Operations in Our Center Could Hurt Our
Ability to Make Timely Delivery of Our Products. We conduct our distribution
operations and Internet order processing fulfillment functions from our facility
in Los Angeles, California which we lease. As such, we have only a limited
ability to reroute orders to third parties for drop-shipping. Any disruption in
the operations at any distribution center, particularly during the holiday
shopping season, could result in late delivery of products and make it difficult
to meet customer demand for our products. If we do not successfully operate our
fulfillment centers, it could significantly limit our ability to meet customer
demand. Because it is difficult to predict demand, we may not manage our
facilities in an optimal way, which may result in excess or insufficient
inventory, and warehousing, fulfillment, and distribution capacity. A failure to
optimize inventory in our fulfillment network will harm our shipping margins by
requiring us to make long-zone shipments or partial shipments from one or more
locations. In addition, we rely upon third party carriers for our product
shipments, including shipments to and from our distribution and fulfillment
centers to our customers. As a result, we are subject to certain risks,
including employee strikes, inclement weather, fire, flood, power loss,
earthquakes, labor disputes, acts of war or terrorism, or acts of God,
associated with such carriers' ability to provide delivery services to meet our
shipping needs.


                                       26
<PAGE>

      A Significant Portion of Our Sales Force and Suppliers Are Located in Hong
Kong and China. Our Business Would Be Adversely Affected If Our Suppliers Are
Not Able to Meet Our Demand and Alternative Sources Are Not Available. We rely
partially on a select group of contract manufacturers, most of whom are located
in Asia (primarily China), to produce our products in sufficient quantities to
meet customer demand and to obtain and deliver these products to our customers
in a timely manner. These arrangements are subject to the risks of relying on
products manufactured outside the United States, including political unrest and
trade restrictions, local business practice and political issues, including
issues relating to compliance with domestic or international labor standards,
currency fluctuations, work stoppages, economic uncertainties, including
inflation and government regulations, availability of raw materials and other
uncertainties. If we are unable to successfully obtain and timely deliver
sufficient quantities of these products, our operating results may be adversely
affected. There is increasing political pressure on China to permit the exchange
rate of its currency, the Yuan, to float against the dollar. Although
substantially all of our supply contracts in China are denominated in dollars,
our suppliers could attempt to renegotiate these contracts if the Yuan/dollar
exchange rate were to change.

      We Depend On the Ability of Third Parties to Timely Deliver Sufficient
Quantities pf Products and Our Business Can Be Harmed By Work Stoppages or Other
Interruptions to Delivery Of Products. All products we purchase from our vendors
in Asia must be shipped to our distribution center by freight carriers. We
cannot assure you that we will be able to obtain sufficient freight capacity on
a timely basis and at favorable rates. Our inability to acquire suitable
products in a cost-effective, timely manner or the loss of one or more key
vendors or freight carriers could have a negative effect on our business.

      We Maintain a Merchandise Return Policy, Which Allows Customers to Return
Their Merchandise, and As a Result, Excessive Merchandise Returns Could Harm Our
Business. We make allowances for returns of Internet sales in our financial
statements based on historical return rates. We cannot assure you that actual
merchandise returns will not exceed our allowances. In addition, because our
allowances are based on historical return rates, we cannot assure you that the
introduction of new products, increased sales over the Internet, changes in our
merchandise mix or other factors will not cause actual returns to exceed return
allowances. Any significant increase in merchandise returns that exceed our
allowances could have a material adverse effect on our future results.

      The Seasonality of Our Business May Place Increased Strain on Our
Operations. We expect a disproportionate amount of our net sales to be realized
during the fourth quarter of our fiscal year. Due to this seasonality, our
operating results for any one period may not be indicative of our operating
results for the full fiscal year. Internet usage generally slows during the
summer months, and sales in almost all of our product groups usually increase
significantly in the fourth calendar quarter of each year. Like other retailers,
we typically make merchandising and purchasing decisions well in advance of the
holiday shopping season. If we do not stock popular products in sufficient
amounts or fail to have sources to timely restock popular products, such that we
fail to meet customer demand, it could significantly affect our revenue and our
future growth. If we overstock products, we may be required to take significant
inventory markdowns or write-offs, which could reduce gross profits. A failure
to optimize inventory in our U.S. fulfillment network will harm our shipping
margins by requiring us to make long-zone shipments or partial shipments from
one or more locations. Orders from each of our internationally focused websites
are fulfilled primarily from a single fulfillment center, and we have only a
limited ability to reroute orders to third parties for drop-shipping. We may
experience a decline in our shipping margins due to complimentary upgrades,
split-shipments, and additional long-zone shipments necessary to ensure timely
delivery, especially for the holiday season. If too many customers access our
websites within a short period of time due to increased holiday or other demand,
we may experience system interruptions that make our websites unavailable or
prevent us from efficiently fulfilling orders, which may reduce the volume of
goods we sell and the attractiveness of our products and services. In addition,
we may be unable to adequately staff our fulfillment centers during these peak
periods and third parties that provide fulfillment services to our customers may
be unable to meet the seasonal demand.

      We generally have payment terms with our vendors that extend beyond the
amount of time necessary to collect proceeds from our customers. As a result of
holiday sales, at December 31 of each year, our cash, cash equivalents, and
marketable securities balances reach their highest level (other than as a result
of cash flows provided by or used in investing and financing activities). This
operating cycle results in a corresponding increase in accounts payable. Our
accounts payable balance could decline during the first three months following
year-end, which will result in a decline in the amount of cash, cash
equivalents, and marketable securities on hand.


                                       27
<PAGE>

      We May Be Subject to Product Liability Claims if People or Property Are
Harmed by the Products We Sell. Some of the products we sell may expose us to
product liability claims relating to personal injury, death, or property damage
caused by such products, and may require us to take actions such as product
recalls. Certain businesses and individuals also sell products using our
e-commerce platform that may increase our exposure to product liability claims,
such as if these sellers do not have sufficient resources to protect themselves
from such claims. Although we maintain liability insurance, we cannot be certain
that our coverage will be adequate for liabilities actually incurred or that
insurance will continue to be available to us on economically reasonable terms,
or at all. In addition, some of our vendor agreements with our suppliers and
third party sellers do not indemnify us from product liability.

      We Would Also Realize Significant Competitive Pressure if Any of Our
Distribution Providers Were to Initiate Their Own Retail Operations. Since our
distributors have access to merchandise at very low costs, they could sell
products at lower prices and maintain a higher gross margin on their product
sales than we can. In this event, our current and potential customers may decide
to purchase directly from these distributors. Increased competition from any
distributor capable of maintaining high sales volumes and acquiring product at
lower prices than us could significantly reduce our market share.

      Poor Economic Conditions May Reduce Consumer Spending on Discretionary
Retail Products Such As the Ones We Offer. Consumer spending patterns,
particularly discretionary spending for products such as ours, are affected by,
among other things, prevailing economic conditions, stock market volatility,
threats of war, acts of terrorism, wage rates, interest rates, inflation,
taxation, consumer confidence and consumer perception of economic conditions.
General economic, political and market conditions, such as recessions, may
adversely affect our business results and the market price of our common stock.
We may not be able to accurately anticipate the magnitude of these effects on
future quarterly results.

      Risks Related to Our Media and Advertising Business

      The U.S. and Chinese Markets Are Key to Our Current and Future Revenue
Growth, and Political Instability In This Market Could Reduce Our Revenue and
Seriously Harm Our Business. Since the launch of our TradeDragon portal, and
after the launch of our BonusChina portal, we anticipate that a significant
portion of our customers and our revenues will be derived from the Chinese and
U.S. markets. We believe our operations in China will continue to grow for the
next several years. We believe that our current and future dependence on the
U.S. and Chinese markets and their revenues is significant, and adverse
political changes in the U.S. or China may harm our business and cause our
revenues to decline.

      If Our Current and Potential Customers Are Not Willing to Use the Services
Provided By Our Portals, We May Not Attract And Retain a Critical Mass of
Customers. Our services will be attractive to suppliers and advertisers only if
buyers use our services to identify suppliers and purchase their products. The
content, products and suppliers currently available on our websites and other
media or made available by suppliers may not be sufficient to attract and retain
buyers. If buyers and suppliers do not accept our online services and other
media, or if we are unable to attract and retain a critical mass of buyers and
suppliers for our online services and other media, our business will suffer and
our revenues may decrease. None of the advertisers or suppliers that currently
pay to advertise on our portals are under any long-term contractual obligation
to continue using our services. There is no assurance that our advertisers or
suppliers will renew their contracts with us. If we cannot replace non-renewing
customers with new customers, our business could be adversely affected.

      If We Are Not Able to Generate Significant Advertising Revenue, We May Not
Be Able to Sustain Profitability. Our future success will depend in part on the
willingness of product manufacturers and other advertisers to advertise on our
Web site. There is significant uncertainty about the demand for and market
acceptance of Internet advertising. We cannot assure you that the market for
Internet advertising will expand, become sustainable or that we will be able to
continue to provide an attractive forum for advertisers. If the market for
Internet advertising fails to develop or if we do not provide an attractive
forum for advertisers, our business may cease to be profitable. Because our
advertising revenues carry higher gross margins than our product sales, any
decline in our advertising revenues would have a disproportionate impact on our
overall gross margin. If our advertising revenues decline, we may not be able to
replace these revenues through other programs or through our product sales, and
we may be unable to achieve profitability.


                                       28
<PAGE>

      If We Are Unable to Compete Effectively, We Will Lose Current Customers
and Fail to Attract New Customers. Our Media and Advertising division faces
intense competition. Barriers to entry are minimal, and competitors are able to
launch new websites and other media at a low cost. Competition is likely to
result in price reductions, reduced margins and loss of market share, any one of
which may harm our business. We compete for our share of customers' marketing
and advertising budgets with other online marketplaces. Competitors vary in
size, geographic scope, industries served and breadth of the products and
services offered. We may encounter competition from companies which offer more
comprehensive content, services, functionality and/or lower prices.

      Many of our current and potential competitors may have greater financial,
technical, marketing and/or other resources and experience and greater name
recognition than we have. In addition, many of our competitors may have
established relationships with one another and with our current and potential
suppliers and buyers and may have extensive knowledge of our industry. Current
and potential competitors have established or may establish cooperative
relationships with third parties to increase the ability of their products to
address customer needs. Accordingly, our competitors may develop and rapidly
acquire significant market share.

      Our Business Could Suffer if We Are Unsuccessful in Making, Integrating,
and Maintaining Commercial Agreements, Strategic Alliances, and Other Business
Relationships. We may enter into commercial agreements, strategic alliances, and
other business relationships with other companies to rent our "Opted-In"
database, develop partnerships with brokers, and upon the launch of our virtual
stores, provide fulfillment, customer service, inventory management, payment
processing and other services. These arrangements may require substantial
personnel and resource commitments by us, which may constrain the number of such
agreements we are able to enter into and may affect our ability to integrate and
deliver services under the relevant agreements. If we fail to implement,
maintain, and develop successfully the various components of such commercial
relationships, these initiatives may not be viable. The amount of compensation
we receive under certain of these agreements is dependent on the volume of
online traffic directed to such company's website. Therefore, if the other
business's website or product or services offering is not successful, we may not
receive all of the compensation we are otherwise due under the agreement or may
not be able to maintain the agreement. Moreover, we may not be able to succeed
in our plans to enter into additional commercial relationships and strategic
alliances on favorable terms.

      As our agreements expire or otherwise terminate, we may be unable to renew
or replace these agreements on comparable terms, or at all. Some of our
agreements involve high margin services, such as our database rental agreements,
and as such agreements expire they may be replaced, if at all, by agreements
involving lower margin services. In addition, companies may experience business
failures and become unable to meet their obligations to us. We may in the future
enter into further amendments of these agreements or encounter other parties
that have difficulty meeting their contractual obligations to us, which could
adversely affect our operating results.

      General Economic Uncertainty May Reduce Spending for Business-to-Business
Marketing and Advertising. The revenue growth and profitability of our business
depends significantly on the overall demand for business-to-business media and
especially online marketplace services. We believe that the markets for these
services are subject to the potentially negative impact of a number of factors,
including reductions in marketing expenditures by suppliers and the overall
weakening of global economies. These factors may give rise to a number of market
trends that adversely affect our business and revenues.

      Risks Related To Our Securities

      We are Controlled By Stanford International Holding Corporation, a
majority of which is owned by Michael Mak, our Chief Executive Officer, and
Carson Kwong, Our Former Director. Stanford International Holdings beneficially
own 57.9% of the issued and outstanding shares of our common stock. Michael Mak,
our Chief Executive Officer and director, and Carson Kwong, our former director,
own 40.36% and 9.64%, respectively, of Stanford. Accordingly, Mr. Mak controls
the power to elect our directors, to appoint new management and to oppose
actions requiring shareholder approval, such as adopting amendments to our
articles of incorporation and approving mergers or sales of all or substantially
all of our assets. Such concentration of ownership may have the effect of
delaying or preventing a change of control even if a change of control is in the
best interest of all shareholders. In addition, Mr. Mak may still effectively
control our company even if his share holdings are significantly reduced. There
may be instances in which the interest of our controlling shareholder may
conflict with the interest of a holder of our securities. This control could
adversely affect the voting and other rights of our other stockholders and could
depress the market price of our common stock.


                                       29
<PAGE>

      Our Securities Are Illiquid and Will Be Subject to Rules Relating to
"Penny Stocks." Our common stock is listed on the Over-the-Counter Bulletin
Board maintained by the National Quotation Bureau, Inc. under the symbol "BAWC".
There can be no assurance that any market will continue to exist for our
securities, or that our securities may be sold without a significant negative
impact on the price per share. Furthermore, our securities are subject to the
rules promulgated under the Securities Exchange Act of 1934 relating to "penny
stocks." These rules require brokers who sell securities that are subject to the
rules, and who sell to other than established customers and institutional
accredited investors, to complete required documentation, make suitability
inquiries of investors and provide investors with information concerning the
risks of trading in the security. Consequently, an investor would likely find it
more difficult to buy or sell our securities in the open market.

      Our Future Operating Results May Fluctuate and Cause the Price of Our
Common Stock to Decline. Our limited operating history and the emerging nature
of the markets in which we operate make it difficult to accurately predict our
future revenues. Our revenue and operating profit growth depends on the
continued growth of demand for the products and services offered by us, and our
business is affected by general economic and business conditions throughout the
world. A softening of demand, whether caused by changes in consumer preferences
or a weakening of the U.S. or global economies, may result in decreased revenue
or growth. Terrorist attacks and armed hostilities create economic and consumer
uncertainty that could adversely affect our revenue or growth. Such events could
create delays in, and increase the cost of, product shipments, which may
decrease demand. Revenue growth may not be sustainable and our company-wide
percentage growth rate may decrease in the future.

      The factors that could cause our operating results to fluctuate include,
but are not limited to:

      o     fluctuations in the amount of customer spending on the Internet;

      o     our ability to generate significant advertising revenues;

      o     our ability to build and maintain customer loyalty;

      o     the introduction of new or enhanced Web pages, services, products
            and strategic alliances by us and our competitors;

      o     price competition on the Internet or higher wholesale prices in
            general;

      o     the success of our brand building and marketing campaigns;

      o     our ability to acquire merchandise, manage our product mix and
            inventory, and fulfill orders;

      o     the introduction by our competitors of websites, products, services,
            or improvements;

      o     our ability to maintain our distributor, vendor and other key
            corporate relationships;

      o     increases in the cost of online or offline advertising;

      o     unexpected increases or disruptions in shipping costs or delivery
            times;

      o     government regulations related to use of the Internet for commerce;

      o     our ability to maintain, upgrade and develop our Web site,
            transaction processing systems and network infrastructure;

      o     technical difficulties, system downtime or Internet brownouts;

      o     the amount and timing of operating costs and capital expenditures
            relating to maintaining our business, operations and infrastructure;

      o     general economic conditions and economic conditions specific to the
            Internet and online commerce;

      o     additions or departures of key personnel; and

      o     certain analyst reports, news, and speculation.

      Any of these events may cause our stock price to rise or fall and may
adversely affect our business and financing opportunities.


                                       30
<PAGE>

      There is a Limited Public Market for Our Shares and the Trading Volume for
Our Shares is Low Which May Limit Your Ability to Sell Your Shares or Purchase
More Shares. Our common shares have been traded in the public market for a
limited time and this market may not be sustained. As of the date of this
Report, we have approximately 14 shareholders of record, 19,862,000 shares of
our common stock issued and outstanding, 6,000,000 of which are free trading
shares. However, because of the small number of shareholders and the small
number of publicly tradable shares, we cannot be sure that an active trading
market will develop or be sustained or that you will be able to sell or buy
common shares when you want to. As a result, it may be difficult to make
purchases or sales of our common shares in the market at any particular time or
in any significant quantity. If our shareholders sell our common shares in the
public market, the market price of our common shares may fall. In addition, such
sales may create the perception by the public of difficulties or problems with
our products and services or management. As a result, these sales may make it
more difficult for us to sell equity or equity related securities in the future
at a time or price that is appropriate.

      Future Sales of Our Common Shares Could Depress the Price of the Common
Shares. Future sales of common shares by us or our existing shareholders could
adversely affect the prevailing market price of the common shares. As of August
15, 2005, we had 19,862,000 common shares outstanding. Each of Stanford and
Archer Pacific Management, Inc. (an affiliate of Ernest Cheung, our former
director and officer) owns 11,500,000 shares or approximately 57.9% and
2,351,380 or approximately 11.84%, respectively, of our issued and outstanding
common stock. Approximately 13,862,000 are "restricted securities" which can be
resold in the public market only if registered with the Securities and Exchange
Commission or pursuant to an exemption from registration.

      We cannot predict what effect, if any, that future sales of such
restricted shares or the availability of shares for future sale, will have on
the market price of the common shares from time to time. Sales of substantial
amounts of common shares in the public market, or the perception that such sales
could occur, could adversely affect prevailing market prices for the common
shares and could impair our ability to raise additional capital through an
offering of our equity securities.

      We Do Not Intend to Pay Cash Dividends on Our Common Stock. We have never
paid cash dividends on our common stock and do not anticipate paying any cash
dividends on our common stock in the foreseeable future. We anticipate that
profits, if any, received from operations will be devoted to our future
operations.

                              RELATED TRANSACTIONS

Employment Agreement

On January 1, 2004, the Company entered into an employment agreement with its
chief executive officer which provides for an annual salary of $100,000, plus
bonuses of up to 1% of base salary. On January 15, 2004, the Company amended the
employment agreement to adjust the salary to $60,000 per year plus bonuses of up
to 1% of net sales of BonusAmerica over and above $10 million, valid for one
year. The contract was amended to approximate the fair value of services
rendered. For the six months ended June 30, 2005, the Company's chief executive
officer's salary charged to operations was $30,000 (2004: $24,500).

Facilities

On March 1, 2004, the Company began renting warehouse and office facilities from
Stanford on a month-to-month basis at $6,000 per month. In July, 2004, the
Company's monthly rental obligation decreased to $3,500. During the six months
ended June 30, 2005, payments to Stanford related to rent were $21,000 (2004:
$26,610).


                                       31
<PAGE>

Database Rentals

The Company rents its customer database to other divisions of Stanford. Rents
charged are based on 15% of revenues generated from the use of the database.
During the six months ended June 30, 2005, the Company generated revenues of
$2,093 (2004: $10,291) from its database rentals.

Professional Staff Leased

On February 12, 2004, the Company entered into an agreement to pay Stanford a
percentage of employee compensation based upon the percentage of employee hours
used by the Company in 2003. In connection therewith, Stanford will charge the
Company 68% of its total employee costs from January to March 2004. As of April
1, 2004, BonusAmerica started paying its own employment cost. During the six
months ended June 2005, the Company incurred $0 (2004: $174,145) related to the
leasing of professional staff.

Fixed Assets Rentals

On February 20, 2004, the Company agreed to lease property and equipment to
Stanford based on a reasonable and agreed upon charge. Lease charges were
approximately 25% of the depreciation expense in 2004. The same percentage is
used for 2005 since the agreement between the Company and Stanford includes no
agreed upon percentage. During the six months ended June 30, 2005, fixed asset
rental income was $8,700 (2004: $8,700).

Amount Due From Affiliate

The Company advanced $199,919 to Stanford, an affiliated company, during the six
months ended June 30, 2005. The advances are non interest bearing, unsecured and
repayable on demand.

Amount due to related party

Amount due to a related party of $115,426 represents $40,089 due to Michael Mak,
the Company's President and Chief Executive Officer for expenses paid on behalf
of BonusAmerica, payable on demand, and $75,337 due to Megamooch, (an entity
partially owned by Michael Mak) from Sino-Trade, payable on demand..

Item 3. Controls and Procedures.

As of the end of the period covered by this report, the Company carried out an
evaluation of the effectiveness of the design and operation of its disclosure
controls and procedures pursuant to the Exchange Act Rule 13a-14. This
evaluation was done under the supervision and with the participation of the
Company's Chief Executive Officer and Chief Financial Officer, (both currently
Michael Mak). Based upon that evaluation, the Chief Executive Officer and Chief
Financial Officer has concluded that the Company's disclosure controls and
procedures are effective to ensure that information required to be disclosed by
us in the reports that we file under the Exchange Act is accumulated and
communicated to management, including the Chief Executive Officer and Chief
Financial Officer, as appropriate to allow timely decisions regarding required
disclosure.

      There were no significant changes in the Company's internal controls or in
the other factors that could significantly affect those controls since the most
recent evaluation of such controls.


                                       32
<PAGE>

PART II - OTHER INFORMATION

Item  1. Legal Proceedings

      We are a party to a limited number of claims and actions that arise in the
ordinary course of business. The litigation process is inherently uncertain, and
it is possible that the resolution of these matters exists and future litigation
may adversely affect us. We are unaware of any matters that may have material
impact on our financial position, results of operations, or cash flows.

Item 2. Changes in Securities and Use of Proceeds.

        None.

Item 3. Defaults Upon Senior Securities.

        Not Applicable.

Item 4. Submission of Matters To a Vote Of Security Holders.

        None.

Item 5. Other Information.

        None.

Item 6. Exhibits and Reports on Form 8-k.

        (a) Reports on Form 8-K:

        None.

        (b) Exhibits

        3.1    Articles of Incorporation filed with the Nevada Secretary of
               State on February 1, 2002 (Exhibit 3.1 to Registration
               Statement on Form SB-2 filed with the Commission on April
               25, 2002)
        3.2    First Amendment to Articles of Incorporation filed with the
               Nevada Secretary of State on May 20, 2004 (Exhibit 3.1 to
               Form 8K/A filed with the Commission on May 26, 2004)
        3.3    Bylaws  (Exhibit 3.4 to  Registration  Statement on Form SB-2
               filed with the Commission on April 25, 2002)
        3.4    Amended  Bylaws  (Exhibit 3.2 to Form 10Q-SB filed with the
               Commission on February 19, 2003)
        4.1    Form of Stock  Certificate  (Exhibit 4.1 to  Registration
               Statement on Form SB-2 filed with the Commission on April 25,
               2002)
        4.2    Form of Subscription  Agreement (Exhibit 99.1 to Form SB-2 filed
               with the Commission on April 25, 2002)
        4.3    Demand Promissory Note in the principal amount of
               US$100,000, dated April 3, 2002 from the Company in favor of
               Archer Pacific Management Inc. (Exhibit 4.2 to Form SB-2
               filed with the Commission on April 25, 2002)
        4.4    Demand Promissory Note in the principal amount of
               US$39,010.97, dated March 8, 2002 from the Company in favor
               of Archer Pacific Management Inc. (Exhibit 4.3 to Form SB-2
               filed with the Commission on April 25, 2002)
        4.5    Demand Promissory Note in the principal amount of
               US$19,506.16, dated March 8, 2002 from the Company in favor
               of Fred Tse (Exhibit 4.4 to Form SB-2 filed with the
               Commission on April 25, 2002)


                                       33
<PAGE>

        10.1   Assignment, dated June 30, 2004, between the Company and
               Archer Pacific Management Inc. (Exhibit 10.1 to Form 10Q-SB
               filed with the Commission on November 22, 2004).
        10.2   Assignment, dated June 30, 2004, between the Company and
               Fred Tse (Exhibit 10.2 to Form 10Q-SB filed with the
               Commission on November 22, 2004).
        10.3   Share Exchange  Agreement  (Exhibit 10.1 to Form 8-K filed with
               the Commission on March 9, 2004)
        31.1   Certification of Chief Executive Officer pursuant to Section 302
               of the  Sarbanes-Oxley Act of 2002
        31.2   Certification of Chief Financial Officer pursuant to Section 302
               of the  Sarbanes-Oxley Act of 2002.
        32.1   Certification of Chief Executive Officer pursuant to Section 906
               of the  Sarbanes-Oxley Act of 2002.
        32.2   Certification of Chief Financial Officer pursuant to Section 906
               of Sarbanes-Oxley Act.


                                       34
<PAGE>

SIGNATURES

      In accordance with Section 13 or 15(d) of the Securities Exchange Act of
1934, the Registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


                                           BonusAmerica Worldwide Corp.
                                           (Registrant)

Date: August 22, 2005                      By: /s/ Michael Mak
                                               --------------------------------
                                           Chief Executive Officer and Director


Date: August 22, 2005                      By: /s/ Michael Mak
                                               --------------------------------
                                           Chief Financial Officer


                                       35