U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-KSB

XAnnual report under section 13 or 15(d) of the Securities Exchange Act of 1934

For the fiscal year ended December 31, 2002.

___Transition report under section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ____ to ____.

**AGRONIX, INC.**

(Name of small business in its charter)

|Florida                                        | 0-15893                  | 65-0664961                          
|---------------------------------------------- | ------------------------ | ------------------------------------
|(State or other jurisdiction of
incorporation) | (Commission File
Number) | (IRS Employer Identification
Number)

|1666 West 75th Avenue

Vancouver, B.C., Canada | V6P 6G2 
|---------------------------------------------- | --------
|Address of Principal Executive Office          | Zip Code

Issuer's telephone number:  (604) 714-1606

Securities to be registered under Section 12(b) of the Act:

Title of each class

N/A

Securities to be registered under Section 12(g) of the Act:

Common Stock, $0 .001 par value

(Title of Class)

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

Check if  no disclosure of delinquent filers in response to Item 405 of Regulation S-B is not
contained in this form, and no disclosure will be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by reference in Part III of this Form
10-KSB or any amendment to this Form 10-KSB. [  ]

State issuer's revenue for its most recent fiscal year: $ 0

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the
average bid and asked price of such common equity, as of a specified date within the past 60
days. (See definition of affiliate in Rule 12b-2 of the Exchange Act.) $4,347,743, based upon a
bid price of $.3300 as of March 25, 2003.

Note: If determining whether a person is an affiliate will involve an unreasonable effort and
expense, the issuer may calculate the aggregate market value of the common equity held by
non-affiliates on the basis of reasonable assumptions, if the assumptions are stated.

(ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE
YEARS)

Check whether the issuer has filed all documents and reports required to be filed by Section 12,
13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a
court. [ ]Yes [ ] No

(APPLICABLE ONLY TO CORPORATE REGISTRANTS)

State the number of shares outstanding of each of the issuer's classes of common equity, as of the
latest practicable date: As of March 25, 2003, the Company had20,967,981shares outstanding.



DOCUMENTS INCORPORATED BY REFERENCE

If the following documents are incorporated by reference, briefly describe them and identify the
part of the Form 10-KSB (e.g., Part I, Part II, etc.) into which the document is incorporated: (1)
any annual report to security holders; (2) any proxy or information statement; and (3) any
prospectus filed pursuant to Rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act").
The listed documents should be clearly described for identification purposes (e.g., annual report
to security holders for fiscal year ended December 24, 1990).

Transitional Small Business Disclosure Format (Check one): Yes ____; No _X__

PART I

**ITEM 1.   DESCRIPTION OF BUSINESS.**

SPECIAL NOTE OF CAUTION REGARDING FORWARD-LOOKING STATEMENTS

This section and other parts of this 10KSB contain forward-looking statements that are, by their
nature, subject to risks and uncertainties. These forward-looking statements include, without
limitation, statements relating to our company's operations, economic performance, financial
condition, growth and acquisition strategies, investments, and operation plans.  Any such
statements  that are not statements of historical fact may be deemed to be forward-looking
statements.

Without limiting the generality of the foregoing, words such as "believe", "expect", "intend",
"anticipate", "may", "will", "should", "expects", "plans", "anticipates", "estimates", "predicts",
"potential", "continue", "projects" or the negative or other variations or comparable terminology
or derivatives thereof denote forward-looking statements. These statements are only predictions
and by their nature involve substantial risks and uncertainties, many of which are beyond control.
Thus, actual results may differ materially from those expressed in or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not
limited to, those discussed herein under the heading **" RISK FACTORS."**

Although we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance or achievements.
We are under no obligation to publicly update any of the forward-looking statements to reflect
events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

**General**

The Company was incorporated under the laws of Florida on May 6, 1996, as RCA
Trading Co. The  Company changed its name to Agronix, Inc. on June 18, 2001.

Pursuant to a share exchange agreement entered into on October 16, 2000 and closed on
March 26, 2001, between the shareholders of Agronix and shareholders of a private Company,
American Waste Recovery, Inc. ("AWR"), the Company acquired 6,622,250 shares of common
stock, or all of the outstanding shares of AWR, solely in exchange for 6,622,250 shares of
common stock of the Company. As a result of this transaction, AWR became a wholly-owned
subsidiary of Agronix, and the former shareholders of AWR in turn became owners of the
majority of the issued and outstanding shares of Agronix.

Agronix, Inc. is in the business of acquiring and developing technologies that convert
organic wastes (animal manure, sewage sludge, bio-solids, produce processing waste etc.) into
agricultural products such as growth substrates, organic fertilizer, soil amendments and other
value added agri-products. The Company is also engaged in the business of developing a
technology that is used to recover chemical commodities from organic waste for a wide variety of
industries such as agriculture, food, oil and gas, paper, clothing and pharmaceuticals.

**Background**

**Description of the Technology**

A worldwide problem facing society is how to deal with organic wastes, such as sewage
sludge, manure from intensive livestock operations and food wastes from homes, restaurants and
commercial food producers. In particular, the solid, liquid and gaseous materials remaining from
those organic waste streams are significant sources of pollution. Increases in animal production,
especially hogs and poultry, together with the application of liquid manures and dewatered
biosolids onto land, have created serious air, soil and water pollution problems. These matters
have resulted in an urgent need for solutions to reduce and deal with these environmental
pollutants. As a result of societal pressures, governments are now enacting strict laws and
regulations to reduce pollution and to require producers to effectively deal with organic wastes.



Recognizing this urgent need, Agronix has acquired and developed two independent
technical processes that can be operated independently or in conjunction with one another to
produce fully sanitized and bio-chemically stabilized end products from sewage sludge, animal
manures and other organic residues that can be sold into the market as agronomic and chemical
commodities.   These two processes are:

**1)	BIO-CONVERSION REACTOR ("BCR") SYSTEM**

The *****BCR SYSTEM* formulates organic waste based on various composition content and
transforms it by a fully optimized process into self-sufficient nutrient growth substrates and high-grade organically-based fertilizers using a proprietary procedure.

The BCR bio-conversion plant is capable of processing organic waste material and can be
increased modularly to meet tonnage requirements. It will consist of the following components:

1. 	A receiving area.

2.	An initial processing module consisting of four concrete troughs.

3.	Organic waste processors.

4. 	A bio-filter tunnel for controlling emissions.

5. 	A silo for storing bulking agents.

6. 	A silo for storing micro-nutrients.

7. 	An agitating/turner machine.

8.	A post processing facility.

The BCR technology is fully engineered and being marketed internationally.

**2)**	**BIO-CHEMICAL INTEGRATED RECYCLING ("BCIR") SYSTEM**(currently in
its final stage of research and development).

The *****BCIR SYSTEM* recovers chemicals and other commodities in an environmentally
friendly manner which can be profitably sold to the polymer, surfactant, lubricant, de-icer and
adhesive industries, and as agri-chemicals.



This system is expected to recover over 1,000 chemical commodities from organic
wastes. To date, the Company has successfully identified and removed 65 of these chemical
commodities. If the full potential of this system is met over the next 6 to12 months, through our
process engineering work at Carleton University, it is expected to have a significant impact on
the Company's business.

Upon the completion of the final phase of Research & Development for the BCIR
System, Agronix expects to have an environmentally-friendly process that will be able to recover
chemicals and other commodities from organic wastes that can be sold profitably to a wide
variety of industries.

**Competing Technologies**

There are a number of companies, which state that they have technologies for dealing
with and processing organic wastes. These companies include Thermo Tech Technologies,
Bedminster, and International Bio-Recovery Corp. Given the enormous volume of organic waste
generated each year, the Company has determined that no competitor has the capacity to deal
with all these wastes and that even with the presence of these and other competitors, there will be
enough demand for the Company's services in the foreseeable future. The Company has further
determined that if the end product of converted organic waste is not in a bio-stabilized form, it
will ultimately prove harmful to the environment. The primary in-feed for competitors' plants is
from municipal solid waste, while the Company's in-feed is intended to be primarily sewage
sludge and animal manures.  To the Company's knowledge, none of its competitors makes the
claim they can fully bio-stabilize their end product and no other company is bio-converting
sewage sludge and animal manures to a fully bio-stabilized commercial organic end product. In
addition, the Company knows of no competing technologies that are able to extract viable
chemical commodities from organic wastes.

**The Business Of The Company**

**Description of Business**

The Company intends to initially use its Bio-Conversion Reactor (BCR) System
technology to treat organic wastes that are relatively contaminant free, such as poultry, cattle and
hog manure, and process it into growth substrates and high-grade organically-based fertilizers.
The Company has identified North American and other world locations of concentrated organic
waste and intends to build its plants in those areas.

Agronix has identified a global market for its technologies. The Company's primary focus
is on Europe and North America, where regulations favor the Company's technologies.

**The Market for the Service**

In North America and Europe, an increasing number of municipalities are imposing
regulations to compel producers of organic waste to deal with these substances in an
environmentally responsible manner. The fact that new companies such as Agronix will be able
to treat organic waste in an environmentally-friendly manner may eventually provide the
incentive for local governments to close landfill sites to organic waste altogether*.*The Company
expects these trends to continue which should result in an increasing demand for the Company's
Service. Tipping fees are available in certain situations, however Agronix has not included those
fees in their financial projections as they vary from one region to another.

**Marketing the Service**

The Company is presently negotiating with producers and strategic partners in areas with
high concentrations of organic waste suitable for the Agronix technologies.

**The Products**

The Agronix BCR System is designed to process organic waste residues under specific
optimally controlled conditions to manufacture a high-quality bio-converted organic fertilizer and
growth substrate.  These products are designed to restore and maintain soil organic matter quality
and quantity, improve soil aggregation and porosity, increase water infiltration and retention and
reduce erosion. The finished bioconverted product can be sold as is, or can be further processed
into two categories of products:

1. 	*****Organically-based Fertilizers* designed to supply nitrogen (N), Phosphorus (P), and
Potassium (K) for the full growth cycle of plants on a bio-modulated release basis; and

2. 	*****Growth Substrates* used for house plants and greenhouse production. The
composition of Agronix's growth substrates are designed to maintain and enhance gas and carbon
exchange, supply nutrients, improve root development, and increase water retention.

A study conducted by Agriculture and Agri-Food Canada compared organic fertilizers
similar to the Company's intended organic fertilizer product with commercial chemical fertilizers
for three major types of crops. The study found that the performance of the organic fertilizer met
or exceeded that of the chemical fertilizers.

Market studies show an increasing demand for organic products. The Company believes
it can fill the growing demand of this niche market by providing a fully bio-stabilized growing
media and at the same time solving a major environmental problem (i.e., the current practice of
spreading non-bio-stabilized sewage sludge and animal manure on agricultural land).

**Market for the Product**

The market for fertilizer in North America is mainly supplied with chemical fertilizers.**Demand for fertilizers in North America is estimated at over 50 million tons per year (primarily
for chemical fertilizers). While the total market for organic fertilizers is relatively small, this
niche market is growing in excess of 20% per year. Increasing consumer demand for organic
food products means that the demand for organic fertilizers is expected to continue to increase. In
North America, an estimated one million acres are under organic cultivation while in Europe the
area is an estimated five million acres, which is projected to grow to 20 million acres over the
next five years. In the past 2 years governments have begun to regulate the disposal of organic
wastes and are restricting the use of chemical fertilizers, herbicides and pesticides.

The Company's primary market will be bulk sales to commercial producers,
manufacturers and distributors. An aging baby boomer segment of the population is expected to
lead to further increases in the home garden market. Accordingly, the Company intends to supply
its products to manufacturers who will meet the needs of consumers who are interested in organic
and enhanced fertilizer products. Distribution will likely be through garden centers, major
grocery chains that have a garden department, and hardware chains that sell gardening supplies.
The consumer product will likely be marketed through established firms that have high levels of
market acceptance for their brand of fertilizers.

The Company also intends to supply its products to municipalities, golf courses and parks
who want organic and enhanced fertilizers.

**Competition for the Product**

The major manufacturers of fertilizer that are actively marketing to the retail sector are
Bayer-Pursell which manufactures Vigoro, a slow release chemical fertilizer, the Scotts Company
which manufactures Miracle Gro and the Shultz Company.  The Company is aware of many
companies that are focused solely on providing organic fertilizer products to the market.
However, none of these companies appears to be able to provide a fully bioconverted organic
fertilizer to the market.

**Product Pricing and Marketing**

With respect to marketing the Product, the Company's intention is to seek out one or more
distributors of fertilizer products with a view to negotiating long term buy-out agreements to buy
the entire output of each plant. This will enable the Company to focus all of its efforts on
building and managing the operations of its plants.

The following are some of the key selling points that the Company will use when
promoting its Product to distributors:

The Company's product is fully bioconverted, free of harmful pathogens, and converts
the heavy metals into a water insoluble form which makes them harmless to the environment.
The Company's product restores and maintains soil organic matter quality and quantity, improves
soil aggregation and porosity, and improves root and plant growth. Another advantage is that the
product is more environmentally friendly than conventional chemical fertilizers.

**Environmental Considerations**

Animal manures, produce growers, industrial food processors and sewage sludge
constitute serious environmental hazards. All these organic wastes can leach into soils and
ground waters causing contamination of soils and underground aquifers. The Company's BCR
System can contribute to remediating environmental pollution problems from these sources. The
Company's BCIR System is designed to extract marketable chemical commodities from sewage
sludge without harming the environment. Presently more than 65 different commodity chemicals
can be extracted using the BCIR system.

Setting up plants will likely require environmental permits from the applicable
government authorities having jurisdiction over the proposed plant locations. Given the fact that
the Company's processes will turn organic wastes (which, if untreated, can cause serious
environmental hazards) into safe organic fertilizers and will extract commodity chemicals
without harm to the environment, the Company is confident the environmental permitting
process will be facilitated wherever possible.

**RISK FACTORS**

Investment in the securities of the Company****must be considered as highly speculative and
should only be undertaken by those investors who have sufficient financial resources to enable
them to assume such risks and who have no need for immediate liquidity in their investment. The
Shares should not be purchased by persons who cannot afford the possibility of the loss of their
entire investment, and an investment in the Shares should not constitute a major portion of an
individual's portfolio. In addition to the usual risks associated with an investment in a business, a
prospective investor should carefully consider the following factors.

**Limited Capital - Need for Additional Financing**.



The Company has very limited capital. The Company will need to raise significant
additional funds through public or private equity or debt financing or from other sources for the
construction and operation of each plant. The sale of additional equity or convertible debt may
result in additional dilution to the Company's shareholders and such securities may have rights,
preferences or privileges senior to those of the common stock. To the extent that the Company
relies upon debt financing, the Company will incur the obligation to repay the funds borrowed
with interest and may become subject to covenants and restrictions that restrict operating
flexibility. No assurance can be given that additional equity or debt financing will be available or
that, if available, it can be obtained on terms favorable to the Company or its shareholders. If
sufficient funding is not secured, then the Company may not able to establish and run a viable
business.

**Start-Up Company - Limited Operating History**.

The operating Company was incorporated in January 2000, has limited assets, has a
limited operating history and is at an early stage of development. All of these factors make it
subject to the risks associated with start-up companies. The Company believes that its growth
and future success will, to a certain degree, be dependent upon receiving operating permits from
local governments over which it will have no control. The Company has had no experience in
installing or operating the plants used to process organic waste and may not be successful in
running such a business. Future operating results will depend on many factors, including local
acceptance of the Company's licensed technology, securing local government approvals for the
construction and operation of the Company's intended plants, purchasing decisions by consumers
of organic fertilizers and growing media and others, the ability to obtain adequate sources of
suitable organic waste for its plants, the level of product and price competition, market
acceptance of the Company's product, evolving industry products, general economic conditions
and other factors.

**Lack of Profitability**.

To date the Company has not had any operations. There can be no assurance that the
Company will succeed in building up a successful operating company, in generating sales, or in
running its operations on a profitable basis. The Company has had no revenues. Because the
Company is still in an emerging stage, there can be no assurance that the Company will ever
achieve profitability. The revenue and profit potential of the Company's business and the industry
is unproven, and the Company's limited operating history makes its future operating results
difficult to predict. There can be no assurance that the Company will have positive gross margins

**Dependence on Key Personnel**

The business of the Company will be dependent upon the active participation of its
officers and directors.  To the extent any of them becomes unavailable for any reason, it could
have a serious adverse impact on the Company.  Any officer or employee of the Company can
terminate his or her relationship with the Company at any time.  The Company's future success
will also depend on its ability to attract, train, retain and motivate highly qualified engineering,
marketing, sales and management personnel. Competition for such personnel is intense, and there
can be no assurance that the Company will be able to attract and retain key personnel.

**Market Acceptance**

The Company's overall economic performance is affected by two different markets: the
organic waste treatment market and the fertilizer market. There are no assurances that the
Company's service or product will be successfully marketed.

**Economic Recession/Price Competition**

The Company's business may be affected by many factors which are beyond****its control,
such as an economic recession and aggressive pricing policies of its competitors. The delivery of
a supply of waste to each plant is dependent upon the Company offering competitive tipping fees.
If these fees are not competitive, the Company may not be able to reach or sustain the capacity of
its plants.

**Strength of the Company's Intellectual Property, Proprietary Soil Science Expertise and
Technology**

The Company does not intend to seek patent protection for its processes or its technology
at this time.  There can be no assurance that the Company will be able to protect its licensed
technology from use by competitors. The Company intends to rely primarily on a combination of
copyright law, industrial design legislation and employee and third party nondisclosure
agreements to protect its intellectual property. There can be no assurance of effective protection
of the Company's intellectual property and there can be no assurance that others will not
independently develop a similar technology or obtain access to the Company's technology.

**Competition**

The Company faces competitive pressures from a variety of companies in each of the
markets it intends to enter, primarily from established companies, most of which have greater
financial, marketing and technical resources than the Company. These competitors may be better
able to withstand pressure on price or other margin pressures. There is no assurance that
companies with competitive technology and greater financial resources will not begin competing
with the Company in the future.

**Inexperience in Emerging Markets**

Purchasers of organic fertilizers may prefer to purchase such products from larger, more
established companies than the Company, as other manufacturers may be better able to supply
large volumes of products on short notice or better prices. In addition, such potential purchasers
may be reluctant to adopt a new Product that has not gained wide acceptance in the industry.
Certain competitors of the Company may establish relationships in the marketplace, further
limiting the Company's ability to sell its Products.

**Environmental Matters**

The Company will be subject to stringent standards designed to reduce air, water and soil
emissions through state and local laws and regulations relating to the protection of human health
and the environment. The issue of whether the proposed plants will meet standards imposed by
various jurisdictions has not been determined.

**Risks of Product Defects, Product Returns and Product Liability**

The Product, the Service or the operation of the plants that the Company intends to build
and operate may contain undetected problems or defects. The occurrence of such problems or
defects could result in product returns and other losses to the Company or its customers. Such
occurrence(s) could also result in the loss of or delay in market acceptance of the Product and/or
Services, which could have a material adverse effect on the Company's business, operating
results and financial condition. Further, although the Company hopes to enter into purchase
agreements with customers that will contain provisions designed to limit the Company's exposure
to potential product or service liability claims, it is possible that such provisions limiting liability
will not be effective as a result of federal, state or local laws or ordinances or unfavorable
judicial decisions. Although the Company has not experienced any product, service or liability
claims, the future sale and support of the Company's products or services, if any, entails the risk
of such claims. A successful product or service liability claim brought against the Company or its
licensees, if any, could have a material adverse effect on the Company's business, operating
results and financial condition.

**Potential Fluctuation in Quarterly Results**

The timing and delivery requirements of fertilizer customers' orders can be expected to
vary substantially on a quarterly basis. Such quarterly variations in sales may have a material
effect on the Company's financial results, as operating expenses are expected to be relatively
fixed in the short term.

**Conflicts of Interest**

Directors of the Company may serve as director of, or have significant shareholdings in,
other reporting companies. To the extent that such other companies may participate in ventures in
which the Company may participate, the directors of the Company may have a conflict of interest
in negotiating and concluding terms respecting the extent of such participation. Legally, directors
of the Company must act honestly, in good faith and in the best interests of the Company in
resolving any conflicts, which may arise, and all directors of the Company are aware of these
fiduciary responsibilities. In determining whether or not the Company will participate in a
particular venture, the directors will primarily consider the degree of risk to which the Company
may be exposed, its financial position at that time and, depending on the magnitude of the
venture and the absence of any disinterested directors, whether or not to subject any ventures in
question to the shareholders of the Company for their approval.

**No Public Market**

There is currently a limited public market for the Company's stock, and there is no
assurance that a more active or liquid market will develop in the future. There is a possibility that
even if a more active or liquid  market does develop for a period of time, it may not be
maintained.  It may also be adversely by future issuances of shares. Therefore, persons who
acquire stock in the Company may have a difficult time liquidating their investment.



**Time Value of Money**

Since there is a time-value in being able to immediately realize a return on one's
investment, investors may be better off investing in an established business company where an
immediate effect can occur as a result of their investment.

**Not a Diversified Company**

The Company does not expect to be a diversified company in the near future.

******Risks of Leverage, Debt Financing**

The Company may utilize debt or other leverage techniques in order to finance its
operations or the construction of its proposed plants. This has certain risks among which are the
risk of foreclosure or unavailability of other debt if unsuccessful.

**No Dividends**

To date, the Company has not paid any cash dividends on its capital stock and
shareholders should not expect to receive any dividends. At present the Company has no assets
from which to pay dividends. If it did, the Company most likely would use such assets for
business operations. The Company does not anticipate paying any cash dividends in the
foreseeable future.

**Control by Current Management and Shareholders**

The Company's executive officers, directors, and greater than 5% shareholders (and their
affiliates) currently beneficially own approximately 23% of the Company's outstanding Common
Stock (including performance shares held in escrow).

**Penny Stock Rules**

At present, the Company would be considered a "penny stock", which generally is a stock
trading under $5.00. Because of abuses in such stocks, the United States Securities Exchange
Commission (the "SEC") has promulgated certain rules regulating the activities of broker dealers
who wish to recommend purchase of such securities to their customers. This often has the result
of reducing trading in such stocks and making it more difficult for investors to sell their shares.

**ITEM 2.  	DESCRIPTION OF PROPERTY**

The Company currently has no investments in real estate, real estate mortgages, or real
estate securities.The Company's principal executive office is  1666 West 75th Avenue,
Vancouver, B.C., Canada V6P 6G2.  The corporate office is located at 4750 Table Mesa Drive,
Boulder, Colorado, 80305.  The Company's telephone numbers are (604) 714-1606 and 1-877-377-2974.  Agronix Europe, Ltd. maintains an office at 4 rue de Simplon, Geneva 1211,
Switzerland.  The  telephone number there is  (0)22-718-9420.  A shareholder pays the rent for
the Company's principal executive office in exchange for the issuance of 1,960 shares per month.****

**ITEM 3.  	LEGAL PROCEEDINGS**

The Company is not a party to any pending legal proceedings, and no such proceedings
are known to be contemplated.  No director, officer or affiliate of the Company, and no owner of
record or beneficial owner of more than five percent (5%) of the securities of the Company, or
any associate of any such director, officer or security holder is a party adverse to the Company or
has a material interest adverse to the Company in reference to pending litigation.

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

No matters were submitted to a vote of the security holders of the Company during the
fourth quarter of the fiscal year which ended December 31, 2001.

PART  II

**ITEM 5. 	 MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS**

The Company's common stock is currently traded under the symbol "AGNI." These
securities are quoted in the over-the-counter market.  AGNI was listed for trading in May 2002,
and began trading in June 2003. The following  table sets forth the Company's high and low
closing prices for the Company's common stock as reported on the Bulletin Board for the
periods indicated.

|Fiscal Year 2002 | High        | Low        
|---------------- | ----------- | -----------
|First Quarter    | not trading | not trading
|Second Quarter   | $0.70       | $0.15      
|Third Quarter    | $0.44       | $0.15      
|Fourth Quarter   | $0.45       | $0.23      

The closing bid price of the Company's common stock as  reported on the Over-the-
Counter Bulletin Board on March 13, 2003 was $0.4500 per share.  The prices presented are bid
prices which represent prices between broker-dealers and don't include retail mark-ups and
mark-downs or any commission to the dealer.  The  prices may not reflect actual transactions.These securities are currently held of record by a total of approximately 184 persons.

No dividends have been declared or paid on the Company's securities, and it is not
anticipated that any dividends will be declared or paid in the foreseeable future.Income  will be
retained for the development and expansion of the Company's business.  Dividend policy for the
future is subject to the discretion of the Board of Directors, and will depend upon a number of
factors, including earnings, debt service, capital requirements, business conditions and other
factors that the Board of Directors may deem relevant.

**ITEM 6.  	MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION**

The following discussion contains certain statements that may constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Any
statements that refer to expectations, projections or other characterization of future events or
circumstances, and especially those which include variations of the words "believes," "intends,"
"estimates," "anticipates," "expects," "plans," or similar words or variations thereof, are likely to
be forward-looking statements, and as such, are likely to concern matters involving risk,
uncertainty, unpredictability and other factors that could materially and adversely affect the
outcome or results indicated by or inferred from the statements themselves. Therefore, the reader
is advised that the following discussion should be considered in light of the discussion of risks
and other factors contained in this Form 10KSB and in the Company's other filings with the
Securities and Exchange Commission, and that no statements contained in the following
discussion or in this Form 10KSB should be construed as a guarantee or assurance of future
performance or future results.



**Introduction**

During the second quarter 2001, the Company held a special shareholders' meeting, which
approved a name, change from RCA Trading Co. d.b.a. American Waste Recovery, Inc. to
Agronix, Inc. This name change complements the market/industry in which the Company does
business. At that time, the number of authorized shares of common stock of the Company was
voted to be increased from 10,000,000 to 25,000,000, and 10,000,000 shares of preferred stock
were also authorized. In January 2002, in conjunction with a 2:1 forward split of its issued and
outstanding common stock, the Company increased its authorized common stock from
25,000,000 to 50,000,000 shares.

**Plan of Operations**

Agronix, Inc. is in the business of acquiring and developing technologies that convert organic
wastes (animal manure, sewage sludge, bio-solids, produce processing waste, etc.) into
agricultural products such as growth substrates, organic fertilizer, soil amendments and other
value added agri-products. The Company is also engaged in the business of developing a
technology that is used to recover chemical commodities from organic waste for a wide variety of
industries such as agriculture, food, oil & gas, paper, clothing and pharmaceuticals. The
Company's Bio-Conversion Reactor System (BCR System) is now fully engineered and ready to
enter the market. The Company has located 3 permitted locations in North America and Europe
which it is currently considering as possible locations to launch its first plant.  These locations
are in Quebec, United Kingdom, and Massachusetts.

The Company remains in the development stage and does not have an established source of
revenue sufficient to cover its operating costs. As of December 31, 2002, the Company had cash
on hand of $23,093, which is not sufficient to allow it to pay its operating expenses and carry out
its plan of operation for the next twelve months. Therefore, it is the Company's intention to seek
additional financing through private and public placements of its common stock and to seek
commercial alliances and begin production where market opportunities exist.

The Company experienced a net loss of $ 1,374,450 for the year ended December 31, 2002,
compared with a loss of $ 945,584 for the previous fiscal year.   For the year ended December 31,
2002, the loss exceeded the same period in 2001 by approximately $428,866, and is related to
R&D costs and the establishment of the Los Angeles office.

Pursuant to an agreement entered into by the Company and BIOMAX Inc., a Canadian Company
located in Quebec City (a developer of automated organic waste processing plants), the Company
and Biomax have created a subsidiary 3884171 Canada Inc. ("Newco") to further develop and
commercialize Biomax's "Robo III" technology by combining the Robo III technology with the
Agronix proprietary technology.  In exchange for its technology contribution, Biomax has an
80% interest in Newco, and for its cash contribution of $229,000 CAD, intellectual property and
proprietary soil science expertise Agronix has received exclusive licensing rights and a 20%
equity interest. Agronix has the right to purchase a further 30% equity interest over the next 3
years for $1,500,000 CAD.  The asset in Newco has been expensed as per US GAAP rules;
however, this accounting change has no material affect on the acquisition of the technology
acquired by Agronix, Inc. and the related contracts.

**Collaborative Research and Development Agreement**

The Company has consolidated its research and development activities at Carleton University in
Ottawa, Canada where pursuant to an agreement (the "Agreement") effective May 1, 2001 and as
amended July 17, 2001, the Company has committed to fund a maximum of approximately
$378,000, (plus applicable taxes), towards certain projects over the four year period ending April
30, 2005.  Under the terms of the Agreement interest accrues at 1.5% per month on Carleton's
invoices that are not paid within 30 days.

The company will own any new technologies and/or intellectual property arising out of these
research and development activities.  Carleton will have the right to (a) a royalty free
non-exclusive license for research and educational purposes; (b) a reasonable royalty on any
commercially exploitable projects; and (c) in the event the Company does not exploit the projects
within a specified time to be agreed upon, the right to commercially exploit them shall be
reassigned to Carleton University, subject to a royalty-free non-exclusive license to the
Company.  To date the Company has incurred $169,131 for research and development and
$7,018 in accrued interest on its outstanding liability to Carleton.

Agronix is actively involved in negotiations to joint venture Bio-Conversion Reactor System
(BCR) plants in the following jurisdictions:

USA - Massachusetts, New York

Europe - Geneva, Switzerland (Greater Regional District), Germany and Ireland

Canada - Alberta, British Columbia and Quebec;

Additionally, the Company is presently negotiating with a large feed and plant nutrient supplier
with operations in the US and Canada to secure take-out contracts for Agronix's BCR plant
organic fertilizers and growth substrates.

The Company has entered into discussions with the Farm Credit Corporation (FCC) of Canada to
provide 75% financing for plants to be constructed in Canada, but there is no assurance that this
funding will be available.  100% financing is available through the FCC provided the company
partners with members of the Agriculture community.

The Company has its research and development activities at Carleton University in Ottawa where
its has committed to fund research being carried out by Carleton University for a period of 5
years. The Company will own any new technologies and/or intellectual property arising out of
these research and development activities.

During the third quarter the company moved significantly forward by signing agreements with
British Columbia Bio-Ventures and Peter Drummond.  BC Bio-Ventures will provide the
company with all logistical aspects for product marketing and plant development as it relates the
BCR & BCIR Systems.  Peter Drummond has been appointed the new CEO and Chairman of the
company.  His extensive background in the waste and composting industry combined with his
international contacts will provide the company with valuable access to a wide range of
government programs.  His primary duties will include that of corporate finance, strategic
planning and technology licensing.

The past year has presented its challenges for raising funds; however, the Company has been
successful in negotiating Letters Of Intent with potential partners.  In the event the Company is
able to complete contracts with any of its potential partners, those contracts are expected to
provide immediate revenues and profits to the Company.  Furthermore it will showcase the
Company's technology while introducing new growing products for the agriculture and other
related industries.

The Company is listed for trading on the OTC Bulletin Board under the symbol "AGNI."

**ITEM 7. 	FINANCIAL STATEMENTS.**

See the following pages.

******AGRONIX, INC.******

(A Development Stage Company)

**CONSOLIDATED FINANCIAL STATEMENTS**

****

**DECEMBER 31, 200**2

**AGRONIX, INC.**

****

****(A Development Stage Company)****

**DECEMBER 31, 2002**

******CONTENTS**

|******AUDITORS' REPORT******                    | ****
|----------------------------------------------- | ----
|**CONSOLIDATED FINANCIAL STATEMENTS**           |     
|Consolidated Balance Sheets                     |     
|Consolidated Statements of Operations           |     
|Consolidated Statements of Cash Flows           |     
|Consolidated Statements of Stockholders' Equity |     
|Notes to Consolidated Financial Statements      |     

LABONTE & CO.

Chartered Accountants

610 -938 Howe Street

Vancouver, B.C. Canada

V6Z 1N9

Telephone: (604) 682-2778

Facsimile (604) 689-2778

Email info@labonteco.com

**AUDITORS' REPORT**

To the Stockholders and Board of Directors of Agronix, Inc.

We have audited the consolidated balance sheet of Agronix, Inc. (a development stage company),
as at December 31, 2002 and the consolidated statements of operations, stockholders' equity and
cash flows for the year then ended.  These consolidated financial statements are the responsibility
of the Company's management.  Our responsibility is to express an opinion on these consolidated
financial statements based on our audit.  The comparative financial statements for the fiscal year
ended December 31, 2001 were reported on by other auditors, who rendered a qualified opinion
regarding the Company's ability to continue as a going concern, in their report dated March 5,
2002.

We conducted our audit in accordance with Canadian and United States generally accepted auditing
standards.  Those standards require that we plan and perform an audit to obtain reasonable assurance
whether the financial statements are free of material misstatement.  An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial statements.  An audit also
includes assessing the accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our audit provides a reasonable
basis for our opinion.

In our opinion, these consolidated financial statements present fairly, in all material respects, the financial
position of the Company as at December 31, 2002 and the results of its operations and its cash flows and
the changes in stockholders' equity for the year ended December 31, 2002, in accordance with generally
accepted accounting principles in the United States.



"*LaBonte & Co."*

******

CHARTERED ACCOUNTANTS

Vancouver, B.C.

March 25, 2003



******COMMENTS BY AUDITORS FOR U.S. READERS ON CANADA-UNITED STATES REPORTING
DIFFERENCES**

In the United States, reporting standards for auditors would require the addition of an explanatory paragraph following the
opinion paragraph when the financial statements are affected by conditions and events that cast substantial doubt on the
Company's ability to continue as a going concern, such as those described in Note 1.  Our report to the stockholders and Board
of Directors dated March 25, 2003 is expressed in accordance with Canadian reporting standards, which do not permit a
reference to such conditions and events in the auditors' report when these are adequately disclosed in the financial statements.



"*LaBonte & Co."*

Vancouver, B.C.

March 25, 2003CHARTEREDACCOUNTANTS



**AGRONIX, INC.**

****( A Development Stage Company)****

**CONSOLIDATED BALANCE SHEETS******

**ASSETS**

|                                    | ******December 31** | **********December 31**
|----------------------------------- | ------------------- | -----------------------
|                                    | ******2002******    | **********2001**       
|**CURRENT**                         |                     |                        
|Cash                                | $23,093             | $100,610               
|Receivables                         | 22,597              | 1,071                  
|Prepaid expenses and deposits       | 15,085              | 4,087                  
|                                    | 60,775              | 105,768                
|**FIXED ASSETS**(Note 3)            | 10,326              | 9,998                  
|**INVESTMENT IN AND ADVANCES TO**   |                     |                        
|**3884171 CANADA INC.**(Note 4)**** | ********1****       | ********143,017        
|                                    | $71,102             | $258,783               

**LIABILITIES AND STOCKHOLDERS' EQUITY**

|**CURRENT LIABILITIES**                  |          |        
|---------------------------------------- | -------- | -------
|Accounts payable and accrued liabilities | $259,078 | $28,786
|Due to related parties (Note 5)          | 63,440   | 69,870 
|                                         | 322,518  | 98,656 



**STOCKHOLDERS' EQUITY (CAPITAL DEFICIENCY)**

|**CAPITAL STOCK**(Note 6) |  | 
|------------------------- |  | 
|**Authorized:**           |  | 

50,000,000 common shares with a par value of $0.001 per share

10,000,000 preferred shares with a par value of $0.001 per share

|**Issued and outstanding:**                             |                         |                    
|------------------------------------------------------- | ----------------------- | -------------------
|20,967,981 (2001: 19,328,074 after giving effect to 2:1 |                         |                    
|stock split) common shares                              | 11,247                  | 9,664              
|Additional paid in capital                              | 2,797,610               | 1,836,286          
|****                                                    | 2,808,857               | 1,845,950          
|**DEFICIT ACCUMULATED DURING THE**                      | ********                | ********           
|**DEVELOPMENT STAGE**                                   | ********(3,060,273)**** | ********(1,685,823)
|****                                                    | (251,416)               | 160,127            
|                                                        | $71,102                 | $258,783           

Continuance of operations (Note 1)

Commitments (Note 8)

See accompanying notes to the consolidated financial statements.

********



( A Development Stage Company)**CONSOLIDATED STATEMENTS OF OPERATIONS**

|************                                        | **********Cumulative** | ************     | ********        
|--------------------------------------------------- | ---------------------- | ---------------- | ----------------
|****                                                | ******From Inception** | **For the**      | **For the**     
|                                                    | ******(Jan 20, 2000)** | **Year Ended**   | **Year Ended**  
|                                                    | **to December 31**     | **December 31**  | **December 31** 
|                                                    | ******2002**           | **********2002** | **********2001**
|****                                                | ********               | ****             | ****            
|******INTEREST INCOME**                             | $2,973                 | $547             | $1,248          
|******EXPENSES**                                    |                        |                  |                 
|Consulting fees                                     | 1,472,662              | 593,848          | 415,894         
|Depreciation                                        | 16,390                 | 15,179           | 899             
|General and administrative                          | 94,382                 | 40,133           | 35,831          
|Professional fees                                   | 174,575                | 63,331           | 67,662          
|Rent                                                | 42,213                 | 21,782           | 17,941          
|Research and development                            | 770,153                | 271,470          | 334,183         
|Salaries and benefits                               | 73,566                 | 73,566           | -               
|Shareholder communications                          | 33,930                 | 26,571           | 4,846           
|Travel and promotion                                | 235,654                | 119,396          | 69,576          
|                                                    | 2,913,525              | 1,225,276        | 946,832         
|******LOSS**before the following                    | (2,910,552)            | (1,224,729)      | (945,584)       
|Loss on impairment of investment in and advances to |                        |                  |                 
|3884171 Canada Inc. (Note 4)                        | (149,721)              | (149,721)        | -               
|******NET LOSS FOR THE YEAR**                       | **$(3,060,273)**       | **$(1,374,450)** | **$(945,584)**  
|****                                                | ********               | ************     | ********        
|****Weighted average common                         | ********               | ************     | ********        
|shares outstanding                                  |                        | ****20,043,678   | ****15,879,450  
|****                                                | ********               | ********         | ****            
|Basic loss per  share                               |                        | ****$(0.07)****  | ********$(0.06) 



See accompanying notes to the consolidated financial statements.

**AGRONIX, INC.**

( A Development Stage Company)

******CONSOLIDATED STATEMENTS OF CASH FLOWS**

|********                                            | **********Cumulative** | ************         | ********        
|--------------------------------------------------- | ---------------------- | -------------------- | ----------------
|                                                    | **From Inception**     | **For the**          | **For the**     
|                                                    | **(January 20, 2000)** | **Year Ended**       | **Year Ended**  
|                                                    | **to December 31**     | **December 31**      | **December 31** 
|                                                    | ******2002******       | **********2002****** | **********2001**
|******Cash derived from (applied to):**             |                        |                      |                 
|******OPERATING ACTIVITIES**                        | ************           | ************         | ********        
|NET LOSS FOR THE YEAR                               | $(3,060,273)           | $(1,374,450)         | $(945,584)      
|Depreciation                                        | 16,390                 | 15,179               | 899             
|Non-cash research and development expenses (Note 7) | 383,856                | -                    | 233,856         
|Stock-based compensation                            | 677,900                | 200,900              | 295,750         
|Impairment of Investment in 3884171 Canada Inc.     | 149,721                | 149,721              | -               
|Wages paid through the issuance of common shares    | 4,500                  | 4,500                | -               
|Rent paid through issuance of common shares         | 23,209                 | 13,100               | 10,109          
|Consulting and legal fees paid though the           |                        |                      |                 
|issuance of common shares                           | 375,260                | 326,045              | 49,214          
|Change in non-cash working capital                  |                        |                      |                 
|Receivables                                         | (22,597)               | (21,526)             | (668)           
|Prepaid expense and deposits                        | (15,085)               | (10,998)             | (4,087)         
|Payables and accruals                               | 245,974                | 230,290              | 6,420           
|                                                    | (1,221,145)            | (467,239)            | (354,091)       
|******FINANCING ACTIVITIES**                        |                        |                      |                 
|Advances under a credit facility with a company     |                        |                      |                 
|with director in common, net of repayments          | 63,440                 | (6,430)              | 62,870          
|Advances from (to) shareholder                      | (14,267)               | -                    | (14,267)        
|Shares issued or subscribed for cash                | 1,371,501              | 418,362              | 456,140         
|                                                    | 1,420,674              | 411,932              | 504,743         
|******INVESTING ACTIVITIES**                        |                        |                      |                 
|Acquisition of fixed assets                         | (26,714)               | (15,505)             | (8,632)         
|Investment in and advances to 3884171 Canada Inc.   | (149,722)              | (6,705)              | (136,450)       
|                                                    | (176,436)              | (22,210)             | (145,082)       
|****Increase (decrease) in cash                     | 23,093                 | (77,517)             | 5,570           
|**Cash,** beginning of year                         | -                      | 100,610              | 95,040          
|**Cash,** end of year                               | $23,093                | $23,093              | $100,610        
|******Supplemental cash flow information:**         |                        |                      |                 
|Shares issued for research and development          | $383,856               | $-                   | $233,856        
|Stock based compensation                            | $677,900               | $200,900             | $295,750        
|Shares issued for rent                              | $23,209                | $13,100              | $10,109         
|Shares issued for consulting and legal services     | $375,259               | $326,045             | $49,214         
|Shares issued for wages                             | $4,500                 | $4,500               | $-              



See accompanying notes to the consolidated financial statements.

****

****

******AGRONIX, INC.**

****( A Development Stage Company)****

**CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY**

**FOR THE PERIOD FROM INCEPTION (JANUARY 20, 2000) TO DECEMBER 31, 2002**

********
************
************
************
************
**********Deficit**
************************
****
**Accumulated**
**********Common**
**Common**
**Additional**
****
**During the**
**********Shares**
**Shares**
**Paid-In**
**Shares**
**Development**
**********(Number)**
**(Amount)**
**Capital**
**Subscribed**
**Stage**
**Total**Shares issued for cash at****************$0.001 per share
5,250,000
$5,250
$-
$-
$-
$5,250Shares issued for cash at$0.30 per share
40,000
40
7,960
-
-
8,000Shares issued for cash at$0.34 per share($0.50 Cdn)
1,000,000
1,000
337,287
-
-
338,287Shares issued for cash at$0.67 per share($1.00 Cdn)
182,250
182
122,780
-
-
122,962Shares issued to acquireresearch anddevelopment (Note 7)
150,000
150
149,850
-
-
150,000Shares subscribed at $1.00cash per share
-
-
-
22,500
-
22,500Stock based compensation
-
-
181,250
-
-
181,250Net loss
-
-
-
-
(740,239)
(740,239)Balance, December 31, 2000
6,622,250
6,622
799,127
22,500
(740,239)
88,010Acquisition of AWR onMarch 26, 2001 (Note 1)
6,622,250
6,622
(33,990)
-
-
(27,368)Reverse merger adjustment
(4,939,000)
(4,939)
4,939
-
-
-Shares issued at $0.57 pershare ($1.00 Cdn)
669,357
670
404,543
(22,500)
-
382,713Shares issued for premiseslease at $0.64 per share($1.00 Cdn)
15,680
15
10,094
-
-
10,109Shares issued for cash at$0.32 per share($0.50 Cdn)
231,000
231
73,196
-
-
73,427Shares issued for consultingservices at $0.64 pershare ($1.00 Cdn)
442,500
443
282,627
-
-
283,070Stock based compensation
-
-
295,750
-
-
295,750Net loss for the year
-
-
-
-
(945,584)
(945,584)Balance, December 31, 2001
9,664,037
$9,664
$1,836,286
$-
$(1,685,823)
$160,127

See accompanying notes to the consolidated financial statements.

**AGRONIX, INC.**

( A Development Stage Company)

**CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY**

**FOR THE PERIOD FROM INCEPTION (JANUARY 20, 2000) TO DECEMBER 31, 2002**

********
************
************
************
************
**********Deficit**
************************
****
**Accumulated**
**********Common**
**Common**
**Additional**
****
**During the**
**********Shares**
**Shares**
**Paid-In**
**Shares**
**Development**
**********(Number)**
**(Amount)**
**Capital**
**Subscribed**
**Stage**
**Total**Balance, December 31, 2001
9,664,037
$9,664
$1,836,286
$-
$(1,685,823)
$160,127Shares issued for premiseslease at $0.64 per share($1.00 Cdn)
1,960
2
1,230
-
-
1,232Shares issued for consultingservices at $0.64 pershare ($1.00 Cdn)
55,000
55
35,132
-
-
35,187Pre-split subtotal
9,720,997
9,721
1,872,648
-
-
-Two-for-one stock split
9,720,997
-
-
-
-
-Shares issued for consultingservices at $0.64 pershare ($1.00 Cdn)
164,500
164
105,299
-
-
105,463Shares issued for premiseslease at $0.32 per share($0.50 Cdn)
19,720
20
6,241
-
-
6,261Shares issued for premiseslease at $0.56 per share($0.85 Cdn)
2,300
2
1,281
-
-
1,283Shares issued for cash at$0.35 per share($0.55 Cdn)
450,000
450
155,523
-
-
156,073Shares issued for cash at$0.39 per share($0.60 Cdn)
16,667
17
6,559
-
-
6,576Shares issued for cash at$0.45 per share($0.70 Cdn)
30,000
30
13,683
-
-
13,713Shares issued for cash at$0.50 per share
384,000
384
191,616
-
-
192,000Shares issued for cash at$0.75 per share
67,000
67
49,933
-
-
50,000Shares issued for consultingservices at $1.00 pershare
100,000
10
99,900
-
-
100,000Shares issued for consultingservices at $0.45 pershare
30,500
30
13,695
-
-
13,725Shares issued for consultingservices at $0.40 pershare
16,000
16
6,384
-
-
6,400Shares issued for consultingservices at $0.37 pershare
1,000
1
369
-
-
370Balance carried forward
20,723,681
$10,882
$2,523,131
$-
$(1,685,823)
$848,410****

****See accompanying notes to the consolidated financial statements.****

****

**AGRONIX, INC.**

( A Development Stage Company)****

**CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY**

**FOR THE PERIOD FROM INCEPTION (JANUARY 20, 2000) TO DECEMBER 31, 2002**



********
************
************
************
************
**********Deficit**
************************
****
**Accumulated**
**********Common**
**Common**
**Additional**
****
**During the**
**********Shares**
**Shares**
**Paid-In**
**Shares**
**Development**
**********(Number)**
**(Amount)**
**Capital**
**Subscribed**
**Stage**
**Total**Balance forward
20,723,681
$10,882
$2,523,131
$-
$(1,685,823)
$848,410Shares issued for consultingservices at $0.36 pershare
4,500
4
1,616
-
-
1,620Shares issued for consultingservices at $0.34 pershare
139,000
139
47,121
-
-
47,260Shares issued for consultingservices at $0.29 pershare
20,500
10
5,924
-
-
5,945Shares issued for consultingservices at $0.25 pershare
16,000
16
3,984
-
-
4,000Shares issued for consultingservices at $0.15 pershare
40,500
41
6,034
-
-
6,075Shares issued for premiseslease at $0.45 per share
2,300
3
1,032
-
-
1,035Shares issued for premiseslease at $0.40 per share
2,300
2
918
-
-
920Shares issued for premiseslease at $0.34 per share
2,300
2
780
-
-
782Shares issued for premiseslease at $0.29 per share
2,300
3
664
-
-
667Shares issued for premiseslease at $0.25 per share
2,300
2
573
-
-
575Shares issued for premiseslease at $0.15 per share
2,300
2
343
-
-
345Shares issued for wages at$0.45 per share
10,000
10
4,490
-
-
4,500Stock-based compensation
-
-
200,900
-
-
200,900Net loss
-
-
-
-
(1,374,450)
(1,374,450)Balance, December 31, 2002
20,967,981
$11,106
$2,591,777
$-
$(3,060,273)
$(251,416)

See accompanying notes to the consolidated financial statements.

****

****

******AGRONIX, INC.**

**( A Development Stage Company)******

**NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2002**

- **OPERATIONS AND GOING CONCERN**

********The company was incorporated under the laws of Florida, U.S.A. on May 6, 1996 as RCA
Trading Co.  The company changed its name to Agronix, Inc. on June 18, 2001.

Pursuant to a share exchange agreement entered into on October 16, 2000 and closed on March
26, 2001, between the shareholders of the Agronix and shareholders of a private Company,
American Waste Recovery, Inc. ("AWR"), the Company purchased all of the outstanding shares
of AWR.  AWR was incorporated under the laws of Nevada, U.S.A. on January 20, 2000 as
American Bio Recovery, Inc.; on January 26, 2000, its name was changed to American Waste
Recovery, Inc.  The consideration for this acquisition was the issuance by the company of
6,622,250 common shares.

As a result of this transaction, AWR has become a wholly-owned subsidiary of Agronix and the
former shareholders of AWR in turn became owners of the majority of the issued and
outstanding shares of Agronix.  Since the former shareholders of AWR have acquired control of
Agronix through this transaction, it is considered a reverse acquisition and these financial
statements are presented from the perspective of AWR (the accounting parent in this transaction).
These financial statements present the consolidated results of operations from AWR's date of
incorporation (January 20, 2000) to December 31, 2002 including the results of operations of
Agronix since March 26, 2001.****

Agronix has focused its activities on the development of its acquired technologies for
commercial use, for identifying prime international locations to build commercial plants, and
forming strategic alliances for the implementation of its global business plan.  No significant****revenues have been realized and planned principal operations have not yet commenced.  Agronix
is engaged in the acquisition and development of technologies that convert organic residues into
agricultural products such as growth substrates, organic fertilizers, soil amendments and
chemical commodities for agriculture and industry use.

These consolidated financial statements have been prepared on the basis of a going concern,
which contemplates the realization of assets and satisfaction of liabilities in the normal course of
operations.  The Company has not generated any significant revenues and has incurred losses
since inception.  At December 31, 2002 the Company had a working capital deficiency of
$261,743 and a capital deficiency of $251,416.  Accordingly, these factors raise substantial doubt
as to the Company's ability to continue as a going concern.  The Company's continued existence
is dependent upon its ability to raise additional capital and to ultimately achieve profitable
operations.  It is management's intention to pursue market acceptance for its product and identify
funding sources until such time that there is sufficient operating cash flow to fund operating
requirements.****

- **SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

****	These consolidated financial statements are presented in U.S. dollars unless otherwise stated and
have been prepared in accordance with accounting principles generally accepted in the United
States of America and include the accounts of the company and its wholly-owned subsidiary,
AWR.****

**STOCK BASED COMPENSATION**

In  December 2002, the Financial Accounting Standards Board issued Financial Accounting
Standard No. 148, "Accounting for Stock-Based Compensation - Transition and Disclosure"
("SFAS No. 148"), an amendment of Financial Accounting Standard No. 123 "Accounting for
Stock-Based Compensation" ("SFAS No. 123").  The purpose of SFAS No. 148 is to: (1) provide
alternative methods of transition for an entity that voluntarily changes to the fair value based
method of accounting for stock-based employee compensation, (2) amend the disclosure
provisions to require prominent disclosure about the effects on reported net income of an entity's
accounting policy decisions with respect to stock-based employee compensatin, and (3) to require
disclosure of those effects in interim financial information.  The disclosure provisions of SFAS
No. 148 were effective for the Company for the year ended December 31, 2002 and the required
disclosures have been made below.

The Company has elected to continue to account for stock-based employee compensation
arrangements in accordance with the provisions of Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" ("APB No. 25") and to comply with the disclosure
provisions of SFAS No. 123 as amended by SFAS No. 148 as described above.  In addition, in
accordance with SFAS No. 123 the Company applies the fair value method using the
Black-Scholes option-pricing model in accounting for options granted to consultants.  Under
APB No. 25, compensation expense is recognized immediately for past services and prorata for
future services over the option-vesting period.****

The Company accounts for equity instruments issued in exchange for the receipt of goods or
services from other than employees in accordance with SFAS No. 123 and the conclusions
reached by the Emerging Issues Task Force in Issue No. 96-18, "Accounting for Equity
Instruments That Are Issued to Other Than Employees for Acquiring or in Conjunction with
Selling Goods or Services" ("EITF 96-18").  Costs are measured at the estimated fair market
value of the consideration received or the estimated fair value of the equity instruments issued for
consideration other than employee services is determined on the earlier of a performance
commitment or completion of performance by the provider of goods or services as defined by
EITF 96-18.

The Company has also adopted the provisions of the Financial Accounting Standards Board
Interpretation No. 44, Accounting for Certain Transactions Involving Stock Compensation - An
Interpretation of APB Opinion No. 25 ("FIN 44"), which provides guidance as to certain
applications of APB 25.  FIN 44 is generally effective July 1, 2000 with the exception of certain
events occurring afer December 15, 1998.****

****The following table illustrates the pro forma effect on net income (loss) and net income (loss) per
share as if the Company had accounting for its stock-based employee compensation using the fair
value provisions of SFAS No. 123 by applying the fair value method using the Black-Scholes
option pricing model using the assumptions as described in Note 6.****

****

|************ | ************                        | **********Year Ended**            | **********Year Ended******   
|------------ | ----------------------------------- | --------------------------------- | -----------------------------
|****         |                                     | **************December 31, 2002** | **********December 31, 2001**
|             | **Net loss:**                       |                                   |                              
|             | Actual net loss                     | $(1,374,450)                      | $(945,584)                   
|             | Proforma net loss                   | $(1,624,450)                      | $(1,010,834)                 
|             | **Loss per share:**                 |                                   |                              
|             | Actual net loss per share           | $(0.07)                           | $(0.06)                      
|             | Proforma net loss per share         | $(0.08)                           | $(0.06)                      
|             |                                     |                                   |                              
|             | Weighted average shares outstanding | 20,043,678                        | 15,879,450                   
|             |                                     |                                   |                              

**FIXED ASSETS**

Fixed assets are recorded at cost less accumulated depreciation.  Depreciation is recorded on the straight-line
method at the following rates:

****

|Office equipment   | 20	% | straight line
|------------------ | ---- | -------------
|Computer equipment | 30	% | straight line
|Computer software  | 50	% | straight line

**INVESTMENTS**

****	The company uses the equity method to account for investments in companies such as 3884171
Canada Inc. and other business ventures over which it exercises significant influence.

**TECHNOLOGY**

The company capitalizes the acquisition costs of technologies when their technological feasibility
has been established; otherwise such costs are charged to operations.

**RESEARCH AND DEVELOPMENT**

The Company records all research and development costs in accordance with SFAS 2
"Accounting for Research and Development Costs".  As such, all research and development costs
are expensed as they are incurred, until such time as the research and development outcome is
proven for commercial use, at which time the costs are capitalized and amortized**.******

**LONG-LIVED ASSETS**

****The company monitors the recoverability of long-lived assets, including fixed assets and its
investments in and advances to 3884171 Canada Inc., based on estimates using factors such as
current market value, future asset utilization, and future undiscounted cash flows expected to
result from its investment or use of the related assets.  The company's policy is to record any
impairment loss in the period when it is determined that the carrying amount of the asset may not
be recoverable.  Any impairment loss is calculated as the excess of the carrying value over
estimated realizable value.****

**LOSS PER SHARE**

****The company follows SFAS No. 128 to calculate earnings (loss) per share.  Basic loss per share
is computed using the weighed effect of all common shares issued and outstanding.  Fully diluted
earnings per share has not been presented as the effect on basic earnings per share is anti-dilutive.

Basic loss per share for 2001 has been restated to reflect the two-for-one stock split which
occurred on January 9, 2002.****

**USE OF ESTIMATES**

In preparing financial statements in conformity with accounting principles accepted in the United
States of America, management is required to make estimates and assumptions that affect the
reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at
the dates of the financial statements for the reporting period.  Actual results may differ from
those estimates.****

**FOREIGN CURRENCY TRANSLATION**

****The financial statements are presented in United States dollars.  In accordance with Statement of
Financial Accounting Standards No. 52, "Foreign Currency Translation", foreign denominated
monetary assets and liabilities are translated to their United States dollar equivalents using
foreign exchange rates which prevailed at the balance sheet date.  Revenue and expenses are
translated at average rates of exchange during the period.  Related translation adjustments are
reported as a separate component of stockholders' equity, whereas gains or losses resulting from
foreign currency transactions are included in results of operations.****

**COMPARATIVE FIGURES**

Certain of the comparative figures have been restated to conform with the current year's
presentation.****

**RECENT ACCOUNTING PRONOUNCEMENTS**

**SFAS 141 & 142**

In July 2001, the Financial Accounting Standards Board ("FASB") issued Statement of Financial
Accounting Standards No. 141 ("SFAS 141"), "Business Combinations", which eliminates the
pooling method of accounting for business combinations initiated after June 30, 2001.  In
addition, SFAS 141 addresses the accounting for intangible assets and goodwill acquired in a
business combination.  This portion of SFAS 141 is effective for business combinations
completed after June 30, 2001.****

****In July 2001, the FASB issued Statement of Financial Accounting Standards No. 142 ("SFAS
142"), Goodwill and Intangible Assets", which revises the accounting for purchased goodwill and
intangible assets.  Under SFAS 142, goodwill and intangible assets with indefinite lives will no
longer be amortized and will be tested for impairment annually or whenever events or
circumstances indicate that the estimated fair value is less than the related carrying value as
determined on a reporting unit basis.  SFAS 142 is effective for fiscal years beginning after
December 15, 2001.****

**SFAS 143 & 144**

In July 2001, the FASB issued SFAS No. 143, Accounting for Asset Retirement Obligations.
This statement addresses financial accounting and reporting for obligations associated with the
retirement of tangible long-lived assets and the associated asset retirement costs.  This statement
applies to all entities.  It applies to legal obligations associated with the retirement of long-lived
assets that result from the acquisition, construction, development and (or) the normal operation
of a long-lived asset, except for certain obligations of lessees.  This statement is effective for
financial statements issued for fiscal years beginning after June 15, 2002.****

In August 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or Disposal of
Long-Lived Assets.  This statement addresses financial accounting and reporting for the
impairment or disposal of long-lived assets and supersedes FASB Statement No. 121,
Accounting for the Impairment of Long-Lived Assets to be Disposed Of.  The provisions of the
statement are effective for financial statements issued for fiscal years beginning after December
15, 2001.  ****

The adoption of SFAS 141, 142, 143 & 144 has not had a material effect on the financing
position of the Company or on the results of its operations.****

**3.	FIXED ASSETS**

|************            | ************     | ************             | **********Net**         | **********Net******    
|----------------------- | ---------------- | ------------------------ | ----------------------- | -----------------------
|************            | ************     | **********Accumulated**  | **********December 31** | **********December 31**
|********                | **********Cost** | **********Amortization** | **********2002**        | **********2001**       
|Office equipment        | $6,964           | $1,290                   | $5,674                  | $1,039                 
|Computer equipment      | 6,644            | 2,345                    | 4,299                   | 1,776                  
|Computer software       | 973              | 620                      | 353                     | 67                     
|Option to purchase land | -                | -                        | -                       | 7,116                  
|                        | $14,581          | $4,255                   | $10,326                 | $9,998                 

**4.	INVESTMENT IN AND ADVANCES TO 3884171 CANADA INC.**

Pursuant to an agreement dated March 26, 2001 entered into by the Company and Bo-Max Inc.
("Bio-Max") (a Quebec City, Canada based developer of organic waste processing plants), a
subsidiary (3884171 Canada Inc. ("Newco")) was created in which the Company owns 20% of
the issued and outstanding common shares and Bio-Max owns 80% of the issued and outstanding
common shares.  Newco has been established to further the development and commercialization

of Bio-Max's "Robo III" technology into Agronix/Bio-Max technology [Agronix Bio-Conversion
Reactor System (BCR)] using Agronix intellectual property rights and proprietary bio-conversion
formulae.

Under the terms of the agreement:

(a) Bio-Max contributed $80 Cdn and the Robo III technology as its capital contribution for an
80% interest in Newco.  The Company contributed $20 Cdn and its technical process
improvements, its intellectual property rights and proprietary bio-conversion formulae as its
capital contribution for a 20% interest in Newco with a option to purchase a further 30% of
Newco for $1,500,000 CAD.  Should the Company exercise this option, it would be a 50/50
partner with Bio-Max in Newco.

(b) The Company and Bio-Max have given each other a right of first refusal to match any offer to
purchase any shares of Newco owned by each of them.

(c) Agronix has the non-exclusive world licensing rights for Robo III from Newco with the
exception of the Francophone countries.

(d) Agronix has advanced $229,000 CAD to Newco which has completed Robo III engineering
and the Bio-Conversion Reactor System (BCR) to be licensed or sold for commercial plant
operations throughout the world.

The company's investment in and advances to Newco have been accounted for as follows:



|******** | ************                                                 | **********December 31** | **********December 31**
|-------- | ------------------------------------------------------------ | ----------------------- | -----------------------
|         |                                                              | **************2002**    | **********2001**       
|         | Investment in shares                                         | $13                     | $13                    
|         | Advances, non-interest bearing, no stated terms of repayment | 149,709                 | 143,004                
|         | Impairment of investments and advances written-off           | (149,721)               | -                      
|         |                                                              | $1                      | $143,017               

To date, 3884171 Canada Inc. has used the funds advanced from the Company to further develop
its technology and has not yet commenced commercial operations.  Management has determined
that the recoverability of these advances cannot be reasonably assured and as a result has
recorded an impairment provision in the period of $149,721.

****

**5.**	**DUE TO RELATED PARTIES**

|******** | ************                                                          | **********December 31** | **********December 31**
|-------- | --------------------------------------------------------------------- | ----------------------- | -----------------------
|         |                                                                       | **************2002**    | **********2001**       
|         | Revolving credit facility with a shareholder, unsecured, non-interest |                         |                        
|         | bearing, principal due on December 31, 2002                           | $-                      | $7,000                 
|         | Demand loan from a company controlled by a shareholder                |                         |                        
|         | - unsecured, principal in the amount of $100,000 Cdn; 12%             |                         |                        
|         | annum simple interest; interest payable monthly; repayable            |                         |                        
|         | on demand or on June 30, 2003                                         | 63,440                  | 62,870                 
|         |                                                                       | $63,440                 | $69,870                

****6.		CAPITAL STOCK

On June 11, 2001 the Company amended its Articles of Incorporation to change the authorized
number of shares from 20,000,000 common shares to 25,000,000 and the authorized number of
preferred shares from 5,000,000 to 10,000,000.

On January 9, 2002 the company amended its outstanding number of common shares to reflect a
two-for-one split.  As a result, the 9,720,997 issued and outstanding shares as of that date
changed to a total of 19,441,994 issued and outstanding shares. In addition, the company
amended its Articles of Incorporation to change the authorized number of shares from
25,000,000  to 50,000,000 common shares.  The Company has retroactively reflected this
two-for-one split in these financial statements.

**STOCK OPTIONS**

The following table summarizes information about outstanding and exercisable share options at
December 31, 2002:



|**Options Outstanding** | **Options Exercisable**
|----------------------- | -----------------------

|                |                      |                      | ************Average       | **Weighted**  | ****            | **Weighted** 
|--------------- | -------------------- | -------------------- | ------------------------- | ------------- | --------------- | -------------
|                |                      |                      | **************Remaining** | **Average**   | ****            | **Average**  
|                |                      | **********Exercise** | **Contractual**           | **Exercise**  | ****            | **Exercise** 
|**Number**      | ****                 | **Price**            | **Life**                  | **Price**     | **Number**      | **Price**    
|**Outstanding** | **Grant Date**       | **Per Share**        | **(In Years)**            | **Per Share** | **Exercisable** | **Per Share**
|****840,000**** | ********01/27/00**** | ********$0.25        | ****3.08                  | ****$0.25     | ****840,000     | ****$0.25    
|400,000         | 01/28/00             | 0.25                 | 3.08                      | 0.25          | 400,000         | 0.25         
|300,000         | 02/17/00             | 0.25                 | 3.13                      | 0.25          | 300,000         | 0.25         
|500,000         | 08/04/00             | 0.25                 | 3.59                      | 0.25          | 500,000         | 0.25         
|150,000         | 10/30/00             | 0.34                 | 3.83                      | 0.34          | 150,000         | 0.34         
|400,000         | 01/17/01             | 0.50                 | 3.05                      | 0.50          | 400,000         | 0.50         
|80,000          | 07/03/01             | 0.50                 | 4.51                      | 0.50          | 80,000          | 0.50         
|1,000,000       | 07/09/01             | 0.25                 | 3.52                      | 0.25          | 1,000,000       | 0.25         
|200,000         | 02/22/02             | 0.50                 | 0.15                      | 0.50          | 200,000         | 0.50         
|3,000,000       | 08/15/02             | 1.00                 | 4.62                      | 1.00          | 1,000,000       | 1.00         
|6,870,000       |                      |                      |                           | $0.60         | 4,870,000       | $0.44        



Summary of share option activity and information concerning options at December 31, 2002:

********
********
**********************Year Ended**
**Year Ended****************December 31, 2002**
**********December 31, 2001**Balance, beginning of period
3,670,000
2,340,000Granted
3,200,000
1,530,000Cancelled
-
(200,000)Balance, end of period
6,870,000
3,670,000

During the first quarter of 2002, the Company granted options to purchase 200,000 shares of the
Company's common stock to certain consultants at a price of $0.50 per share for a period of one
year.  Compensation expense of  $200,900 related to these options has been recorded.  The fair
value of these consultant stock options was estimated at the grant date using the Black-Scholes
option-pricing model applying the market value per share and the risk-free interest rate in effect
at the grant date, zero volatility, and an expected life of one year.  The volatility was determined
to be zero as at the grant date as there was not yet an established market for trading in shares of
the Company's common stock.

During the third quarter of 2002, the Company granted options to purchase 3,000,000 shares of
the Company's common stock to the Company's CEO at a price of $1.00 per share for a period of
five years.  One third of these options vest immediately, one third will vest upon the completion
of five years of service and one third when the Company's share capital reaches $100 million.
The Company accounts for stock options granted to directors and employees in accordance with
the provisions of APB Opinion No. 25, Accounting for Stock Options Issued to Employees. No
intrinsic value compensation expense will be recorded upon vesting of these options in
accordance with the provisions of APB No. 25 as the exercise price of the options awarded
exceeded the market price of the Company's common shares as at the date of the award.  Had
compensation cost for the granting of these options been determined in accordance with the
provisions of SFAS No. 123, Accounting for Stock-Based Compensation, based on the fair value
method using the Black-Scholes option-pricing model applying the market value per share and
the risk-free interest rate in effect at the grant date, 222% volatility, and an expected life of five
years, the Company would record $240,000 of additional compensation expense relating to the
vesting of one third of these options.

The Black-Scholes option valuation model was developed for use in estimating the fair value of
traded options and warrants which have no vesting restrictions and are fully transferable.  In
addition, option valuation models require the input of highly subjective assumptions, including
the expected stock price volatility.  Because the company's employee stock options and warrants
have characteristics significantly different from traded options, and because changes in the
subjective input assumptions can materially affect the fair value estimates, in management's
opinion, the existing models do not necessarily provide a reliable measure of the fair value of its
employee stock options.

On March 1, 2002, the Company approved a stock option plan whereby 3 million shares will be
available to compensate some of the company's key contributing consultants and allow the
company to retain and hire qualified personnel.  The 3 million options granted to the CEO as
described above were not granted in connection with this plan.

**PERFORMANCE SHARES**

On January 27, 2000, 1,000,000 post-split performance shares were issued into escrow for the
Company's President and C.E.O.  For each $0.25 of cumulative cash flow generated by the
company from its operations, two performance shares will be released from escrow.  All shares
remain in escrow at December 31, 2002 and are not included in common shares issued and
outstanding.

On September 1, 2002, the Company and its President agreed to transfer these shares to a
consultant under the same terms and conditions.

**7.		RESEARCH AND DEVELOPMENT**

During 2000, AWR acquired certain soil and organic matter expertise and intellectual property
from an unrelated organic residue consultant based in Ottawa, Canada for $150,000.  The
consideration for this acquisition was 300,000 post-split AWR common shares issued at an
estimate of their fair value of $0.50 per share. This research and development acquired has yet to
be proven commercially and its cost of acquisition was expensed.

During 2001, 220,000 post-split Agronix shares were issued at an estimate of their fair value of
$0.32 per share ($0.50 Cdn) to three separate parties with soil science and engineering expertise.
The shares were consideration for engineering activity which was required to advance the design
of the BCIR system to the point that it meets specific functional, manufacturing and economic
requirements.

A further 500,000 post-split shares were issued during 2001 at an estimate of their fair value of
$0.32 per share ($0.50 Cdn) to three separate parties with soil science and engineering expertise.
The shares were consideration for routine, on-going efforts to refine, enrich, and otherwise
improve upon the qualities of the existing BCR system, and the engineering follow-through to
commercial production.

The company has incurred research and development expenses as follows:

****
**********Cumulative**
**********For the**
**********For the****From Inception**
**Year**
**Year****(January 20, 2000)**
**Ended**
**Ended****to December 31**
**December 31**
**December 31********2002******
**********2002******
**********2001**Acquisition of organic matter expertise and intellectualproperty
$164,500
$-
$-Technical development of BCR System
328,943
95,015
233,928Technical development of BCIR System
276,710
176,455
100,255$770,153
$271,470
$334,183**8.		COMMITMENTS**

**Collaborative Research and Development Agreement**

The Company has consolidated its research and development activities at Carleton University in
Ottawa, Canada where pursuant to an agreement (the "Agreement") effective May 1, 2001 and as
amended July 17, 2001, the Company has committed to fund a maximum of approximately
$378,000, (plus applicable taxes), towards certain projects over the four year period ending April
30, 2005.  Under the terms of the Agreement interest accrues at 1.5% per month on Carleton's
invoices that are not paid within 30 days.

The company will own any new technologies and/or intellectual property arising out of these
research and development activities.  Carleton will have the right to (a) a royalty free
non-exclusive license for research and educational purposes; (b) a reasonable royalty on any
commercially exploitable projects; and (c) in the event the Company does not exploit the projects
within a specified time to be agreed upon, the right to commercially exploit them shall be
reassigned to Carleton University, subject to a royalty-free non-exclusive license to the
Company.  To date the Company has incurred $169,131 for research and development and
$7,018 in accrued interest on its outstanding liability to Carleton.

**Licensing Agreement**

The company has entered into a licensing agreement with a private German registered Company
whereby the Company has committed to provide exclusive rights to introduce the Company's
technology throughout Germany, France, Spain and Italy.   Under the agreement the Company
has received a promissory loan note, the principal amount of $10,000,000; non-interest bearing
and expiring on April 30, 2003.

This transaction has not been recorded in the financial statements, as there is uncertainty as to the
collectibility of the $10,000,000 note.

The Company had entered into a licensing agreement with a private U.K. registered Company
whereby the Company had committed to provide exclusive rights to introduce the Company's
technology throughout Europe.  Due to non-performance, the licensing agreement has been
dissolved effective September 25, 2002.

**Consulting Agreements**

On September 1, 2002, the Company entered into a consulting agreement whereby the Company
agreed to pay a minimum of $10,000 Cdn. per month for a period of 36 months.  In addition, the
Company and its President have agreed to transfer the 1,000,000 performance shares to the
consultants.

The Company has entered into certain consulting agreements whereby the Company has
committed to issue a total of 39,500 shares per month to consultants for each month of service
provided subject to monthly renewals.  In addition, the company has committed to issue 100,000
shares every six months to consultants.

The Company has entered into an agreement whereby the Company has agreed to pay a
transaction fee of 10% of the transaction value of any contracts arising from introductions to
prospective contacts.

The Company has entered into a renewable one-year premises lease whereby the Company has
committed to issue 2,300 shares per month in exchange for rental payments.****	**Executive Employment Agreement**

The Company has entered into an executive employment agreement effective August 15, 2002
whereby the Company has agreed to pay $20,000 per month to its C.E.O for a period of sixty
months.  The Company may issue up to 20,000 shares in lieu of salary any months where the
funds are not available.  The Company must pay four months salary on termination.  Under the
terms of this agreement the Company also granted stock options to the C.E.O. providing the right
to acquire 3,000,000 shares of common stock at $1.00 per share for a period of five years. (See
Note 6.)

**Option to purchase land**

The Company acquired an option to purchase a 73 acre parcel of land in the Fraser Valley region
of British Columbia, Canada, on which it intended to construct its initial pilot plant in Western
Canada.   The option expired and the previously capitalized option payments have been expensed
in 2002.

**9.		INCOME TAXES**

At December 31, 2002, the company has net operating losses carried forward of approximately
$1,900,000 that may be offset against future taxable income to 2020.  No future tax benefit has
been recorded in the financial statements, as the company believes that it is more likely than not
that the carryforwards will expire unused between the 2018 and 2022 taxation years.
Accordingly, the potential tax benefits of the loss carry-forwards are offset by a valuation
allowance of the same amount.

**10.   	RELATED PARTY TRANSACTIONS**

During the year ended December 31, 2002, the company paid $130,890 in salary and consulting
fees to its president and CEO, including cash payments of $126,390, and 10,000 common shares
valued at $4,500.  The Company also paid $420,923 to certain officers and other shareholders as
consulting fees comprised of cash payments of $114,355 and 560,000 common shares valued at
$306,568.  In addition, the Company paid 33,860 shares valued at $13,097  to a shareholder in
consideration for a premises lease.

ITEM 8.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.

None.

PART III

ITEM 9. 	DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE
ACT.

The directors and executive officers currently serving the Company are as follows:

Name
Age
Positions Held and TenurePeter Drummond
49
CEO and Chairman  since September 2002Brian Hauff
53
President, CFO and Director since March 2001Peter J. Barnett
62
Director since March 2001Dr. Henri Dinel
52
Director since March 2001

The directors named above will serve until the next annual meeting of the Company's
stockholders.  Thereafter, directors will be elected for one-year terms at the annual stockholders'
meeting.  Officers will hold their positions at the pleasure of the board of directors, absent any
employment agreement, of which none currently exists or is contemplated.  There is no
arrangement or understanding between any of the directors or officers of the Company and any
other person pursuant to which any director or officer was or is to be selected as a director or
officer.

The directors and officers will devote their time to the Company's affairs on an "as
needed" basis, which, depending on the circumstances, could amount to as little as two hours per
month, or more than forty hours per month, but more than likely will fall within the range of five
to ten hours per month.

Biographical Information

**Peter Drummond.**

Peter Drummond has an extensive background in the waste management industry.   He is
Chairman of Watercare Services Limited and Envirowaste Services Ltd., both billion dollar
corporations.  He either acts as a Director or Chairman for 11 companies, many of which
specialize in the management of waste.  His invaluable knowledge of the industry will give
Agronix, Inc. a strong international presence.  Peter Drummond resides with his family in New
Zealand.  Mr. Drummond is well known for his charitable work.

**Brian Hauff.**

Brian Hauff is the President, Chief Executive Officer and a director of the Company. Mr.
Hauff is the founder of the Company and has worked for the Company since its inception. He has
also been an investor/developer for the past 20 years.  Mr. Hauff has a combined Economics and
Commerce degree (Hons.) from Simon Fraser University and a law degree from the University of
British Columbia.  He is a resident of Vancouver, B.C. Canada.

**Peter J. Barnett**.

Peter Barnett is the Chairman and a director of the Company.  He is a co-founder of a
number of restaurant companies including Pizza Patio, Elephant and Castle, and most recently
the Canadian division of the Rainforest Café.  Mr. Barnett is well known for his involvement in
community and charitable services.  Mr. Barnett was honored by Canada with the 125th
Centennial Medal of Honor for contributions to the development of Canadian society. He was
recently honored by his appointment to the presidency of Variety Club International, a worldwide
charity that supports children in need.  Mr. Barnett is a resident of Vancouver, B.C. Canada.

**Dr. Henri Dinel.**

Dr. Henri Dinel is a director of the Company.  He has been a research scientist with the
Research Branch of Agriculture and Agri-Food Canada since 1974 and since 1990 he has been
leading a study on the impact of bio-solids on soil agro-ecological functions and the development
of value-added products from residual and naturally occurring organic matters.  Dr. Dinel
obtained a B.S. in 1981 from the University of Ottawa in plant biology and biochemistry; an
Masters in Science in 1985 from the University of Montreal in Palynology, Paleoecology and
Pedology; and a Ph.D. in 1989 from McGill University in soil sciences.  He is a resident of
Chelsea, Quebec.

**Audit Committee.**

As of the date of this Annual Report, we have not appointed members to an audit
committee and, therefore, the respective role of an audit committee has been conducted by our
Board of Directors. When established, the audit committee''s primary function will be to provide
advice with respect to our financial matters and to assist the Board of Directors in fulfilling
oversight responsibilities regarding finance, accounting, tax and legal compliance. The audit
committee''s primary duties and responsibilities will be to: (i) serve as an independent and
objective party to monitor our financial reporting process and internal control system; (ii) review
and appraise the audit efforts of our independent accountants; (iii) evaluate our quarterly
financial performance as well as compliance with laws and regulations; (iv) oversee
management''s establishment and enforcement of financial policies and business practices; and
(v) provide and open avenue of communication among the independent accountants,
management and the board of directors.

Our Board of Directors has considered whether the regulatory provision of non-audit service is
compatible with maintaining the principal independent accountant''s independence.

**Audit Fees.**

As of the date of this Annual Report, Agronix, Inc. has incurred $4,500 as fees by its
principal independent accountants for professional services rendered in connection with our
audited financial statements for the fiscal year ended December 31, 2002. For fiscal year ended
December 31, 2002, Agronix, Inc. incurred $3,8000 as fees billed by its principal independent
accountant for all other non-audit services (such as review of the Company''s quarterly financial
statements and other expert services).

**Compliance With Section 16(a) of the Exchange Act.**

The Company's officers and directors have each filed and Annual Statement of Changes
in Beneficial Ownership on Form 5.

ITEM 10. 	EXECUTIVE COMPENSATION.

During the year ended December 31, 2002, the company paid $130,890 in salary and
consulting fees to its president and CEO, including cash payments of $126,390, and 10,000
common shares valued at $4,500.  The Company also paid $420,923 to certain officers and other
shareholders as consulting fees comprised of cash payments of $114,355 and 560,000 common
shares valued at $306,568.  In addition, the Company paid 33,860 shares valued at $13,097  to a
shareholder in consideration for a premises lease.

During the third quarter of 2002, the Company granted options to purchase 3,000,000
shares of the Company's common stock to the Company's CEO at a price of $1.00 per share for a
period of five years.  One third of these options vest immediately, one third will vest upon the
completion of five years of service and one third when the Company's share capital reaches $100
million.

ITEM 11. 	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENTAND RELATED STOCKHOLDER MATTERS.

The following table sets forth the number of shares of Common Stock owned of record
and beneficially by executive officers, directors and persons who hold 5.0% or more of the
outstanding Common Stock of the Company.  Also included are the shares held by all executive
officers and directors as a group.

Name and Address
Number of Shares Owned
Beneficially
Percent of ClassBrian Hauff(1)(2)

1666 West 75th Avenue

Vancouver, B.C.,Canada V6P 6G2
1,900,000(2)
8.9 %Peter J. Barnett(1)(3)

1666 West 75th Avenue

Vancouver, B.C.,Canada V6P 6G2
956,000(3)
4.4 %Dr. Henri Dinel(1)(4)

1666 West 75th Avenue

Vancouver, B.C.,Canada V6P 6G2
900,000 (4)
4.2 %Peter Drummond(1)(5)

1666 West 75th Avenue

Vancouver, B.C.,Canada V6P 6G2
3,340,000 (5)
15.5 %Ron Behr(1)(6)

1666 West 75th Avenue

Vancouver, B.C.,Canada V6P 6G2
697,000 (6)
3.2  %Epsom Investment Services

16 Pietermaai

Curacao, Nederlands, Antilles
7,600,000
35.3 %All directors and executive officers as

a group (5 in number)
7,793,000
36.2 %(1)The person listed is an officer, a director, or both, of the Company.As of December 31, 2002, Ron Behr is no
longer an officer.

(2)Includes 1,000,000 performance shares which are currently held in escrow pursuant to an agreement dated
January 27, 2000.  Such shares shall be released from escrow based upon the Company's cumulative cash flow.  For
each $0.25 of cash flow, one share will be released. Any performance shares not released from escrow on or before
January 27, 2010, shall be cancelled. Also includes 600,000 options to purchase 600,000 shares of common stock at
a price of $0.50. The options expire on January 27, 2006.

(3)Includes 256,000 shares owned by family members, of which Mr. Barnett may be deemed to be the beneficial
owner.  Also includes 300,000 shares of common stock and 400,000 options to purchase 400,000 shares of common
stock at a price of $0.50.  The options expire on January 28, 2006.

(4)Includes 600,000 shares and 300,000 options to purchase 300,000 shares of common stock at $0.50 registered in
the name of DRD Consultants, of which Mr. Dinel may be deemed to be the beneficial owner.   The options expire
on August 4, 2006.   DRD Consultant is owned by Denise Regimbald Dinel, the spouse of Dr. Henri Dinel.

(5)Includes 40,00 shares and 300,000 options to purchase 300,000 shares of common stock at $0.50.  The options
expire on January 17, 2006.  Also includes3,000,000 options for underlying common stock of the Company, the
first 1,000,000 of which are immediately exerciseable at a price of $1.00 per option; the second 1,000,000 options
will vest and become exerciseable at the time the value of the Company reaches $100,000,000, and the third
1,000,000 options will vest and become exerciseable when Mr. Drummond has served as Chief Executive Officer of
the Company for five years.

(6)Includes 547,000 shares and 150,000 options to purchase 150,000 shares of common stock at CAD $1.00.

ITEM 12.	 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

During the third quarter of 2002, the Company granted options to purchase 3,000,000
shares of the Company's common stock to the Company's CEO at a price of $1.00 per share for a
period of five years.  One third of these options vest immediately, one third will vest upon the
completion of five years of service and one third when the Company's share capital reaches $100
million.

On March 1, 2002, the Company approved a stock option plan whereby 3 million shares
will be available to compensate some of the company's key contributing consultants and allow
the company to retain and hire qualified personnel.  The 3 million options granted to the CEO as
described above were not granted in connection with this plan.

On January 27, 2000, 1,000,000 post-split performance shares were issued into escrow
for the Company's President and C.E.O.  For each $0.25 of cumulative cash flow generated by
the company from its operations, two performance shares will be released from escrow.  All
shares remain in escrow at December 31, 2002 and are not included in common shares issued and
outstanding.

On September 1, 2002, the Company and its President agreed to transfer these shares to a
consultant under the same terms and conditions.

The Company has entered into an executive employment agreement effective August 15,
2002, whereby the Company has agreed to pay $20,000 per month to its CEO for a period of
sixty months.  The Company may issue up to 20,000 shares in lieu of salary any months where
the funds are not available.  The Company must pay four months salary on termination.  Under
the terms of this agreement, the Company also granted stock options to the CEO providing the
right to acquire 3,000,000 shares of common stock at $1.00 per share for a period of five years.

During the year ended December 31, 2002, the company paid $130,890 in salary and
consulting fees to its president and CEO, including cash payments of $126,390, and 10,000
common shares valued at $4,500.  The Company also paid $420,923 to certain officers and other
shareholders as consulting fees comprised of cash payments of $114,355 and 560,000 common
shares valued at $306,568.  In addition, the Company paid 33,860 shares valued at $13,097  to a
shareholder in consideration for a premises lease.

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K.

The Exhibits listed below are filed as part of this Annual Report.



Exhibit No.				Document



3.1		Articles of Incorporation (incorporated by reference from Registration Statement
on Form 10-SB filed with the Securities and Exchange Commission on May 17,
2000).

3.1a		Amendment to Articles of Incorporation (incorporated by reference from
Registration Statement on Form 10-SB filed with the Securities and Exchange
Commission on May 17, 2000).

3.2		Bylaws (incorporated by reference from Registration Statement on Form 10-SB
filed with the Securities and Exchange Commission on May 17, 2000 ).

Exhibits 99.1 and 99.2**,**  CERTIFICATION PURSUANT TO SECTION 302 OF THE
SARBANES-OXLEY ACT OF 2002****are filed herewith.

No reports on Form 8-K were filed by the Company during the last quarter of its fiscal
year ending December 31, 2002.ITEM 14.	CONTROLS AND PROCEDURES

The Company's Chief Executive Officer and Chief Financial Officer (or those persons
performing similar functions), after evaluating the effectiveness of the Company's disclosure
controls and procedures (as defined in Rules 13a-14(c) and 15d-14(c) under the Securities
Exchange Act of 1934, as amended) as of a date within 90 days of the filing of this annual report
(the "Evaluation Date"), have concluded that, as of the Evaluation Date, the Company's
disclosure controls and procedures were effective to ensure the timely collection, evaluation and
disclosure of information relating to the Company that would potentially be subject to disclosure
under the Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.  There were no significant changes in the Company's internal controls
or in other factors that could significantly affect the internal controls subsequent to the
Evaluation Date.



******SIGNATURES**

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

**AGRONIX, INC.**

****

By:/S/ PETER DRUMMOND

Peter Drummond, Chairman and Chief Executive Officer



By: /S/ BRIAN HAUFF

Brian Hauff, President, Chief Financial Officer and a Director



By:/S/ HENRI  DINEL

Henri Dinel, Vice President and a Director

By:/S/ PETER J. BARNETT

Peter J. Barnett, Director

Date: April 15, 2003

Exhibit 99.1
AGRONIX, INC.
CERTIFICATION PURSUANT TOSECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Peter S. Drummond, certify that:

1.  I have reviewed this annual report on Form 10-KSB of Agronix, Inc.

2.  Based on my knowledge, this annual report does not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to the period covered by this
annual report;

3.  Based on my knowledge, the financial statements, and other financial information included in this
annual report, fairly present in all material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in this annual report;

4.  The registrant's other certifying officers and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
registrant and have:

a) designed such disclosure controls and procedures to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within
90 days prior to the filing date of this annual report (the "Evaluation Date"); and

c) presented in this annual report our conclusions about the effectiveness of the disclosure controls and
procedures based on our evaluation as of the Evaluation Date;

5.  The registrant's other certifying officers and I have disclosed, based on our most recent evaluation,
to the registrant's auditors and the audit committee of registrant's board of directors (or persons
performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal controls which could adversely
affect the registrant's ability to record, process, summarize and report financial data and have identified
for the registrant's auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other employees who have a
significant role in the registrant's internal controls; and

6.  The registrant's other certifying officers and I have indicated in this annual report whether there
were significant changes in internal controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.

Date: April 15, 2003
By: /S/ PETER S. DRUMMOND

Peter S. Drummond, Chairman and Chief Executive OfficerExhibit 99.2
AGRONIX, INC.
CERTIFICATION PURSUANT TOSECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Brian Hauff, certify that:

1.  I have reviewed this annual report on Form 10-KSB of Agronix., Inc.

2.  Based on my knowledge, this annual report does not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to the period covered by this
annual report;

3.  Based on my knowledge, the financial statements, and other financial information included in this
annual report, fairly present in all material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in this annual report;

4.  The registrant's other certifying officers and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
registrant and have:

a) designed such disclosure controls and procedures to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within
90 days prior to the filing date of this annual report (the "Evaluation Date"); and

c) presented in this annual report our conclusions about the effectiveness of the disclosure controls and
procedures based on our evaluation as of the Evaluation Date;

5.  The registrant's other certifying officers and I have disclosed, based on our most recent evaluation,
to the registrant's auditors and the audit committee of registrant's board of directors (or persons
performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal controls which could adversely
affect the registrant's ability to record, process, summarize and report financial data and have identified
for the registrant's auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other employees who have a
significant role in the registrant's internal controls; and

6.  The registrant's other certifying officers and I have indicated in this annual report whether there
were significant changes in internal controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.

Date: April 15, 2003
By:/S/ BRIAN HAUFF

Brian Hauff, Chief Financial Officer and Director